HomeMy WebLinkAboutFINAL PFM Bond Resolution-LTGO Refunding Bond 2020
KITTITAS COUNTY, WASHINGTON
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2020
RESOLUTION NO. 2020-____
A RESOLUTION OF THE BOARD OF COUNTY COMMISSIONERS OF
KITTITAS COUNTY, WASHINGTON, PROVIDING FOR THE
ISSUANCE AND SALE OF A LIMITED TAX GENERAL OBLIGATION
REFUNDING BOND IN THE PRINCIPAL AMOUNT OF NOT TO
EXCEED $6,750,000 TO PROVIDE FUNDS TO REFUND CERTAIN
OUTSTANDING LIMITED TAX GENERAL OBLIGATION BONDS OF
THE COUNTY; PROVIDING THE FORM OF SAID BOND AND
APPROVING THE SALE OF SUCH BOND; DELEGATING CERTAIN
AUTHORITY TO APPROVE THE FINAL TERMS OF THE BOND TO
THE COUNTY REPRESENTATIVE IN CONNECTION WITH THE
SALE; APPOINTING AN ESCROW AGENT; AND AUTHORIZING THE
EXECUTION OF AN ESCROW AGREEMENT RELATED TO SUCH
REFUNDING.
ADOPTED ON JANUARY 21, 2020
Prepared by:
K&L GATES LLP
Seattle, Washington
502686980 v1
KITTITAS COUNTY, WASHINGTON
RESOLUTION NO. 2020-____
TABLE OF CONTENTS*
Page
Section 1. Definitions............................................................................................................... 2
Section 2. Authorization of Bond and Bond Details................................................................ 7
Section 3. Registration, Transfer and Payments ...................................................................... 8
Section 4. Prepayment ............................................................................................................. 9
Section 5. Form of Bond ........................................................................................................ 10
Section 6. Execution of Bond ................................................................................................ 12
Section 7. Refunding Plan and Procedures ............................................................................ 13
Section 8. Tax Covenants; Special Designation .................................................................... 15
Section 9. Bond Fund; Pledge of Funds and Credit ............................................................... 18
Section 10. Defeasance ............................................................................................................ 19
Section 11. Sale of the Bond .................................................................................................... 19
Section 12. No Undertaking to Provide Ongoing Disclosure .................................................. 20
Section 13. Lost, Stolen or Destroyed Bond ............................................................................ 20
Section 14. Additional Covenants............................................................................................ 21
Section 15. Resolution and Laws a Contract with the Bank .................................................... 22
Section 16. Severability ........................................................................................................... 22
Section 17. Effective Date ....................................................................................................... 23
Exhibit A Form of Escrow Deposit Agreement
Exhibit B Form of Costs of Issuance Agreement
* This Table of Contents and the cover page are not a part of this resolution; they are included
for convenience of the reader only.
RESOLUTION NO. 2020-____
A RESOLUTION OF THE BOARD OF COUNTY COMMISSIONERS OF
KITTITAS COUNTY, WASHINGTON, PROVIDING FOR THE
ISSUANCE AND SALE OF A LIMITED TAX GENERAL
OBLIGATION REFUNDING BOND IN THE PRINCIPAL AMOUNT OF
NOT TO EXCEED $6,750,000 TO PROVIDE FUNDS TO REFUND
CERTAIN OUTSTANDING LIMITED TAX GENERAL OBLIGATION
BONDS OF THE COUNTY; PROVIDING THE FORM OF SAID BOND
AND APPROVING THE SALE OF SUCH BOND; DELEGATING
CERTAIN AUTHORITY TO APPROVE THE FINAL TERMS OF THE
BOND TO THE COUNTY REPRESENTATIVE IN CONNECTION
WITH THE SALE; APPOINTING AN ESCROW AGENT; AND
AUTHORIZING THE EXECUTION OF AN ESCROW AGREEMENT
RELATED TO SUCH REFUNDING.
WHEREAS, Kittitas County, Washington (the “County”) has outstanding its Limited Tax
General Obligation and Refunding Bonds, 2010, issued on September 30, 2010, pursuant to
Resolution No. 2010-099 adopted by the Board of County Commissioners (the “Board”) on
September 22, 2010 (the “2010 Bond Resolution”), which remain outstanding as follows:
Maturity Year
(December 1)
Principal Amount
Interest Rate
2020 $ 510,000 3.000%
2021 520,000 3.000
2022 530,000 3.000
2023 555,000 3.000
2024 565,000 3.125
2025 590,000 3.250
2026 610,000 3.375
2027 625,000 3.375
2028 650,000 3.500
2029 665,000 3.625
2030 690,000 3.750
(the “2010 Bonds”); and
WHEREAS, the 2010 Bonds are subject to redemption, at the option of the County, prior
to their stated maturity, on any date on or after June 1, 2020, in whole or in part, and if in part,
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with maturities to be selected by the County at the price of par, plus accrued interest to the date
fixed for redemption; and
WHEREAS, after due consideration it appears to the Board that debt service savings may
be obtained by refunding all or a portion of the 2010 Bonds through the issuance of a limited tax
general obligation refunding bond of the County in the aggregate principal amount of not to
exceed $6,750,000 (the “Bond”); and
WHEREAS, in order to provide the funds required for such purpose, the County now
desires to authorize the issuance of the Bond; and
WHEREAS, the County has received the offer of U.S. Bank National Association (the
“Bank”), dated January 8, 2020, to purchase the Bond, and the Board wishes to accept such offer
on the terms and conditions set forth therein and herein;
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COUNTY
COMMISSIONERS OF KITTITAS COUNTY, WASHINGTON, as follows:
Section 1. Definitions. As used in this resolution, unless a different meaning clearly
appears from the context:
Acquired Obligations means the Government Obligations, if any, now or hereafter
acquired by the County under the terms of this resolution and the Escrow Agreement, if any, to
effect the defeasance and refunding of the Refunded Bonds.
Approved Bid means the offer of the Bank dated January 8, 2020.
Bank means U.S. Bank National Association, Seattle, Washington, and any business
successor thereto.
Board means the Board of County Commissioners, the general legislative body of the
County, as constituted from time to time.
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Bond means the Kittitas County, Washington Limited Tax General Obligation Refunding
Bond, 2020 issued pursuant to this resolution.
Bond Fund means the “Fund #____ – 2020 GO Bond” as described in Section 9 hereof,
which name of fund may be added to or changed prior to closing, as directed by the County
Representative.
Bond Register means the registration books maintained by the Bond Registrar showing
the name, address and tax identification number of each registered owner of the Bond,
maintained pursuant to Section 149(a) of the Code.
Bond Registrar means U.S. Bank National Association, the current fiscal agent of the
State of Washington, as designated by the Treasurer, for the purposes of registering and
authenticating the Bond, maintaining the Bond Register, effecting the transfer of ownership of
the Bond and paying interest on and principal of the Bond.
Bond Year means each one-year period that ends on the date selected by the County.
The first and last Bond Years may be short periods. If no day is selected by the County before
the earlier of the final maturity date of the Bond or the date that is five years after the date of
issuance of the Bond, Bond Years end on each anniversary of the date of issue and on t he final
maturity date of the Bond.
Call Date means June 1, 2020, with respect to the Refunded Bonds.
County Administrator means the duly qualified, appointed and acting County
Administrator of the County, or any other officer who succeeds to the duties n ow delegated to
that office.
Code means the Internal Revenue Code of 1986, as amended, and shall include all
applicable regulations and rulings relating thereto.
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Cost of Issuance Agreement means the agreement of that name, if any, to be entered into
by and between the County and the Escrow Agent, providing for the payment of certain costs of
issuance with respect to the issuance of the Bond, substantially in the form attached hereto as
Exhibit B.
County means Kittitas County, Washington, a political subdivision duly organized and
existing by virtue of the Constitution and laws of the State of Washington.
County Representative means the Treasurer or the Finance Officer of the County.
Escrow Agent, if any, means U.S. Bank National Association.
Escrow Agreement means the Escrow Deposit Agreement, if any, by and between the
County and the Escrow Agent to be dated as of the date of closing and delivery of the Bond
authorized to be executed pursuant to Section 7 of this resolution substantially in the form
attached hereto as Exhibit A.
Event of Default means, with respect to the Bond, a reasonable determination by the
Bank that (a) a Payment Default has occurred; (b) the County has failed to comply with its
obligations or perform any of its duties (other than a Payment Default) under this resolution or
the Bond (or related documentation), which failure continues, and is not cured, for a period of
more than thirty (30) days after the Bank has made a written demand on the County to cure such
failure; or (c) there has been a material misrepresentation by the County in this resolution, the
Bond (or related documentation). Additional default events, if any are specifically provided for
in accordance with the approved terms of the Approved Bid, and specific remedies therefor, may
be set forth in the Bond.
Final Maturity Date means December 1, 2030.
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Finance Officer means the duly qualified, appointed and acting Finance Officer or any
other officer who succeeds to the duties now delegated to that office.
Financial Advisor means PFM Financial Advisors LLC, Seattle, Washington.
First Interest Payment Date means June 1, 2020.
Government Obligations means obligations defined as such in Chapter 39.53 RCW as
now or hereafter amended.
Interest Rate means a rate of 1.91% per annum; provided, however, that upon the
occurrence of an Event of Default, upon notice from the Bank, the Interest Rate shall be
increased by 200 basis points (2%).
Net Proceeds, when used with reference with the Bond, mean the principal amount of the
Bond, plus accrued interest and original issue premium, if any, and less original issue discount, if
any.
Payment Default shall have occurred if the Bank determines that the County has failed to
pay principal or interest on the Bond within ten (10) days after written notice provided by the
Bank of such failure to pay.
Principal Payment Dates mean annually on December 1, commencing December 1,
2020.
Private Person means any natural person engaged in a trade or business or any trust,
estate, partnership, association, company or corporation.
Private Person Use means the use of property in a trade or business by a Private Person
if such use is other than as a member of the general public. Private Person Use includes
ownership of the property by the Private Person as well as other arrangements that transfer to the
Private Person the actual or beneficial use of the property (such as a lease, management or
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incentive payment contract or other special arrangement) in such a manner as to set the Private
Person apart from the general public. Use of property as a member of the general public includes
attendance by the Private Person at municipal meetings or business rental of property to the
Private Person on a day-to-day basis if the rental paid by such Private Person is the same as the
rental paid by any Private Person who desires to rent the property. Use of property by nonprofit
community groups or community recreational groups is not treated as Private Person Use if such
use is incidental to the governmental uses of property, the property is made available for such
use by all such community groups on an equal basis and such community groups are charged
only a de minimis fee to cover custodial expenses.
Refunded Bonds mean the 2010 Bonds selected by the County Representative for
refunding pursuant to Section 7 of this resolution.
Registered Owner means the person named as the registered owner of the Bond in the
Bond Register.
Treasurer means the treasurer of the County pursuant to RCW Ch. 36.29, as amended
from time to time.
Savings Target means a dollar amount equal to at least four percent (4.0%) of the
outstanding principal of the Refunded Bonds.
2010 Bond Resolution means Resolution No. 2010-099, passed by the Board on
September 20, 2010.
2010 Bonds mean the Limited Tax General Obligation and Refunding Bonds, 2010, of
the County issued under date of September 30, 2010, as more particularly described in the
recitals of this resolution.
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Interpretation. In this resolution, unless the context otherwise requires:
(a) The terms “hereby,” “hereof,” “hereto,” “herein,” “hereunder” and any similar
terms, as used in this resolution, refer to this resolution as a whole and not to any particular
article, section, subdivision or clause hereof, and the term “hereafter” shall mean after, and the
term “heretofore” shall mean before, the date of this resolution;
(b) Words of the masculine gender shall mean and include correlative words of the
feminine and neuter genders and words importing the singular number shall mean and include
the plural number and vice versa;
(c) Words importing persons shall include firms, associations, partnerships (including
limited partnerships), trusts, corporations and other legal entities, including public bodies, as well
as natural persons;
(d) Any headings preceding the text of the several articles and sections of this
resolution, and any table of contents or marginal notes appended to copies hereof, shall be sole ly
for convenience of reference and shall not constitute a part of this resolution, nor shall they affect
its meaning, construction or effect; and
(e) All references herein to “articles,” “sections” and other subdivisions or clauses are
to the corresponding articles, sections, subdivisions or clauses hereof.
Section 2. Authorization of Bond and Bond Details. For the purpose of refunding all
or a portion of the 2010 Bonds and thereby effecting a substantial savings to the County and its
taxpayers, the County shall issue its limited tax general obligation refunding bond in the
aggregate principal amount of not to exceed $6,750,000 (the “Bond”). The Bond shall be
designated as the “Kittitas County, Washington, Limited Tax General Obligation Refunding
Bond, 2020”; shall be dated as of the date of its issuance and delivery to the Bank, shall be fully
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registered as to both principal and interest, shall be issued as a single fully registered bond, and
shall be numbered in such manner and with any additional designation as the Bond Registrar
deems necessary for purposes of identification.
The Board hereby authorizes the County Representative to approve the final principal
amount of the Bond, not to exceed $6,750,000 and the amortization schedule in accordance with
the Approved Bid. The principal and interest amounts of the Bond shall be paid in installments
with interest payable commencing on the First Interest Payment Date and principal payable on
Principal Payment Dates, with the final payments due on the Final Maturity Date. The Bond
shall bear interest on unpaid principal from its date or the most recent date to which interest has
been paid at the Interest Rate. Interest shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months.
Section 3. Registration, Transfer and Payments.
(a) Bond Registrar/Bond Register. The Board hereby requests that the Treasurer
specify and adopt the system of registration approved by the Washington State Finance
Committee from time to time through the appointment of state fiscal agents (the “Bond
Registrar”). The Bond Registrar shall keep, or cause to be kept, at its principal corporate trust
office, sufficient records for the registration and transfer of the Bond (the “Bond Register”),
which shall be open to inspection by the County. The Bond Registrar is authorized, on behalf of
the County, to authenticate and deliver the Bond transferred or exchanged in accordance with the
provisions of such Bond and this resolution and to carry out all of the Bond Registrar’s powers
and duties under this resolution. The Bond Registrar shall be responsible for its representations
contained in the Certificate of Authentication on the Bond.
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(b) Registered Ownership. The County and the Bond Registrar may deem and treat
the Registered Owner of the Bond as the absolute owner for all purposes, and neither the County
nor the Bond Registrar shall be affected by any notice to the contrary. Payment of the Bond
shall be made only as described in Section 3 hereof, but such registration may be transferred as
herein provided. All such payments made as described in Section 3 shall be valid and shall
satisfy the liability of the County upon the Bond to the extent of the amount or amounts so paid.
(c) Transfer or Exchange of Registered Ownership. The Bond is transferable only in
whole (i) to a successor in interest (through merger, corporate reorganization or purchase of the
Bank) or (ii) to a “qualified institutional buyer” as such term is defined in Rule 144A of the
Securities Act of 1933, subject to such further limitations noted in the Bond and as referred to in
the Approved Bid and the documentation therein referred.
(d) Registration Covenant. The County covenants that, until the Bond has been
surrendered and canceled, it will maintain a system for recording the ownership of the Bond that
complies with the provisions of Section 149 of the Code.
(e) Place and Medium of Payment. Principal installments of the Bond shall be
payable in lawful money of the United States of America. Upon payment of the final installment
of principal of the Bond, the Bond shall be presented and surrendered by the Registered Owner
at the principal office of the Bond Registrar for cancellation.
Section 4. Prepayment. The Bond is not subject to prepayment prior to its scheduled
maturity.
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Section 5. Form of Bond. The Bond shall be in substantially the following form:
UNITED STATES OF AMERICA
NO. R-1 $__________
STATE OF WASHINGTON
KITTITAS COUNTY
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2020
INTEREST RATE: 1.91%
MATURITY DATE: DECEMBER 1, 2030
REGISTERED OWNER: U.S. BANK NATIONAL ASSOCIATION
____________________
____________________
TAX IDENTIFICATION #: _____________
PRINCIPAL AMOUNT: _________________________ AND NO/100 DOLLARS
KITTITAS COUNTY, WASHINGTON (the “County”), hereby acknowledges itself to
owe and for value received promises to pay to the Registered Owner identified above, or
registered assigns, the Principal Amount specified above, together with interest thereon, at the
Interest Rate, which interest shall be payable semi-annually on June 1 and December 1 of each
year until paid, commencing on June 1, 2020. Principal shall be repaid in installments as
provided on Exhibit A attached hereto. Interest shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months.
Both principal of and interest on this bond are payable in lawful money of the United
States of America. This bond shall bear interest on unpaid principal from its date or the most
recent date to which interest has been paid. The final payment of principal of and interest on this
bond shall be paid to the Registered Owner hereof upon presentation and surrender of this bond
to the fiscal agent of the state of Washington, currently U.S. Bank National Association, as,
authenticating agent and paying agent or such other agent as may be appointed by the Kittitas
County Treasurer (the “Bond Registrar”).
This bond is issued pursuant to Resolution No. 2020-____ (the “Bond Resolution”)
adopted by the Board of the County on January 21, 2020 to provide funds for the purpos e of
refunding certain outstanding general obligation bonds of the County. Capitalized terms used in
this bond and not otherwise defined shall have the meanings given them in the Bond Resolution.
This bond is not subject to prepayment.
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This bond is not a “private activity bond” as such term is defined in the Internal Revenue
Code of 1986, as amended (the “Code”). The County has designated this bond as a “qualified
tax-exempt obligation” under Section 265(b) of the Code for investment by financial institutions.
This bond is not transferable, except (i) to a successor in interest (through merger,
corporate reorganization or purchase of the Bank) or (ii) to a “qualified institutional buyer” as
such term is defined in Rule 144A of the Securities Act of 1933 [additional or alternate
conditions].
The County hereby irrevocably covenants and agrees with the owner of this bond that it
will include in its annual budget and levy taxes annually, within and as a part of the tax levy
permitted to counties without a vote of the electorate, upon all the property subject to taxation in
amounts sufficient, together with other revenues and money legally available therefor, to pay the
principal of and interest on this bond as the same shall become due. The full faith, credit and
resources of the County are hereby irrevocably pledged for the annual levy and collection of
such taxes and the prompt payment of such principal and interest.
The pledge of tax levies for payment of principal of and interest on this bond may be
discharged prior to maturity of this bond by making provision for the payment thereof on the
terms and conditions set forth in the Bond Resolution.
This bond shall not be valid or become obligatory for any purpose or be entitled to any
security or benefit under the Bond Resolution until the Certificate of Authentication hereon shall
have been manually signed by or on behalf of the Bond Registrar or its duly designated agent.
It is hereby certified that all acts, conditions and things required by the Constitution and
statutes of the State of Washington to exist, to have happened, been done and performed
precedent to and in the issuance of this bond have happened, been done and performed and that
the issuance of this bond does not violate any constitutional, statutory or other limitation upon
the amount of bonded indebtedness that the County may incur.
IN WITNESS WHEREOF, Kittitas County, Washington, has caused this bond to be
executed by the manual or facsimile signatures of the Chair and Clerk of the B oard of County
Commissioners, and the seal of the County to be impressed, imprinted, or otherwise reproduced
hereon, as of this ___ day of ___________, 2020.
[SEAL]
KITTITAS COUNTY,
WASHINGTON
Brett Wachsmith, Chair of the Board of
County Commissioners
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ATTEST:
____________________________
Clerk of the Board of
County Commissioners
The Bond Registrar’s Certificate of Authentication for the Bond shall be in substantially
the following form:
CERTIFICATE OF AUTHENTICATION
Date of Authentication: _______________
This is the Limited Tax General Obligation Refunding Bond, 2020, of Kittitas County,
Washington, as described in the within mentioned Bond Resolution and dated ___ day of
______________, 2020.
WASHINGTON STATE FISCAL AGENT,
as Bond Registrar
By
Authorized Signer
EXHIBIT A
AMORTIZATION SCHEDULE
Payment Date Principal Amount Interest Amount Total
Section 6. Execution of Bond. The Bond shall be executed on behalf of the County
with the manual or facsimile signatures of the Chair of the Board and the Clerk of the Board, and
the corporate seal of the County shall be impressed, imprinted or otherwise reproduced thereon.
The Bond shall be valid only if the Certificate of Authentication in the form hereinbefore
recited has been manually executed by or on behalf of the Bond Registrar. Such Certificate of
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Authentication shall be conclusive evidence that the Bond as authenticated has been duly
executed, authenticated and delivered hereunder and is entitled to the benefits of this resolution.
In case either of the officers who shall have executed the Bond shall cease to be an
officer or officers of the County before the Bond so signed shall have been authenticated or
delivered by the Bond Registrar, or issued by the County, such Bond may nevertheless be
authenticated, delivered and issued and upon such authentication, delivery and issuance, shall be
as binding upon the County as though those who signed the same had continued to be such
officers of the County. The Bond may also be signed and attested on behalf of the County by
such persons who at the date of the actual execution of such Bond, are the proper officers of the
County, although at the original date of such Bond any such person shall not have been such
officer of the County.
Section 7. Refunding Plan and Procedures.
(a) Designation of Refunded Bonds. As outlined in the recitals of this resolution, the
2010 Bonds may be called for redemption prior to their scheduled maturities. All or some of the
2010 Bonds may be refunded with the proceeds of the Bond authorized by this resolution. The
County Representative may select some or all of the 2010 Bonds and designate those 2010
Bonds as the “Refunded Bonds”, if and to the extent that the net present value aggregate savings
with respect to the Bond to be realized as a result of the refunding after payment of all allocable
costs of issuance is at least equal to the Savings Target.
(b) Refunding Plan. A portion of the proceeds of sale of the Bond, together with
other funds, if any, provided by the County shall be used on the date of delivery of the Bond to
the Bank or may be delivered to the Escrow Agent for the purpose of defeasing the Refunded
Bonds and paying related costs of issuance. If money is delivered to an Escrow Agent, those
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funds and other money provided by the County shall be used immediately by the Escrow Agent
upon receipt thereof in accordance with the terms of the Escrow Agreement to defease the
Refunded Bonds as authorized by the 2010 Bond Resolution, and pay costs of issuance of the
Bond. The County may defease the Refunded Bonds and discharge such obligations to purchase
certain Government Obligations (which obligations so purchased, are herein called “Acquired
Obligations”), bearing such interest and maturing as to principal and interest in such amounts
and at such times which, together with any necessary beginning cash balance, will provide for
the payment of:
(1) Interest on the Refunded Bonds as such becomes due on and prior to Call
Date; and
(2) The redemption price (100% of the principal amount) of the Refunded
Bonds payable on Call Date.
(c) Escrow Agent/Escrow Agreement. If the Finance Officer determines to utilize the
services of an Escrow Agent, the County will utilize the services of U.S. Bank National
Association to perform the duties described herein (the “Escrow Agent”). A beginning cash
balance, if any, and Acquired Obligations, if any, shall be deposited irrevocably with the Escrow
Agent in an amount sufficient to defease the Refunded Bonds. The proceeds of the Bond after
acquisition of the Acquired Obligations and provision for the necessary beginning cash balance
shall be utilized to pay expenses of the acquisition and safekeeping of the Acquired Obligations
and expenses of the issuance of the Bond.
In order to carry out the purposes of this section, the County Representative is authorized
to execute and deliver to the Escrow Agent, an Escrow Deposit Agreement and a Cost of
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Issuance Agreement, each substantially in the forms attached hereto as Exhibit A and Exhibit B,
respectively.
(d) Implementation of Refunding Plan. The County hereby irrevocably calls the
Refunded Bonds for redemption on the Call Date in accordance with the provisions of the
2010 Bond Resolution.
The Finance Officer (or the Escrow Agent if one is appointed) is hereby authorized and
directed to provide for the giving of a notice of the redemption of the Refunded Bonds in
accordance with the applicable provisions of the 2010 Bond Resolution. The County is
authorized and requested to provide whatever assistance is necessary to accomplish such
redemption and the giving of notices therefor. The costs of publication of such notices shall be
an expense of the County.
Section 8. Tax Covenants; Special Designation. The County covenants that it will
not take or permit to be taken on its behalf any action that would adversely affect the exemption
from federal income taxation of the interest on the Bond and will take or require to be taken such
acts as may reasonably be within its ability and as may from time to time be required under
applicable law to continue the exemption from federal income taxation of the interest on the
Bond.
(a) Arbitrage Covenant. Without limiting the generality of the foregoing, the County
covenants that it will not take any action or fail to take any action with respect to the proceeds of
sale of the Bond or any other funds of the County which may be deemed to be proceeds of the
Bond pursuant to Section 148 of the Code and the regulations promulgated thereunder which, if
such use had been reasonably expected on the date of delivery of the Bond to the Bank, would
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have caused the Bond to be treated as an “arbitrage bond” within the meaning of such term as
used in Section 148 of the Code.
The County represents that it has not been notified of any listing or proposed listing by
the Internal Revenue Service to the effect that it is an issuer whose arbitrage certifications may
not be relied upon. The County will comply with the requirements of Section 148 of the Code
and the applicable regulations thereunder throughout the term of the Bond.
(b) Private Person Use Limitation for Bond. The County covenants that for as long
as the Bond is outstanding, it will not permit:
(1) More than 10% of the Net Proceeds of the Bond to be allocated to any
Private Person Use; and
(2) More than 10% of the principal or interest payments on the Bond in a
Bond Year to be directly or indirectly: (A) secured by any interest in property used or to be used
for any Private Person Use or secured by payments in respect of property used or to be used for
any Private Person Use, or (B) derived from payments (whether or not made to the County) in
respect of property, or borrowed money, used or to be used for any Private Person Use.
The County further covenants that, if:
(3) More than five percent of the Net Proceeds of the Bond are allocable to
any Private Person Use; and
(4) More than five percent of the principal or interest payments on the Bond
in a Bond Year are (under the terms of this resolution or any underlying arrangement) directly or
indirectly:
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(A) secured by any interest in property used or to be used for any
Private Person Use or secured by payments in respect of property used or to be used for any
Private Person Use, or
(B) derived from payments (whether or not made to the County) in
respect of property, or borrowed money, used or to be used for any Private Person Use, then,
(i) any Private Person Use of the project being refinanced by the Bond or Private Person Use
payments described in subsection (4) hereof that is in excess of the five percent limitations
described in such subsections (3) or (4) will be for a Private Person Use that is related to the state
or local governmental use of the projects refinanced with the proceeds of the Bond (including the
Refunded Bonds), and (ii) any Private Person Use will not exceed the amount of Net Proceeds of
the Bond allocable to the state or local governmental use portion of the project(s) to which the
Private Person Use of such portion of the projects refinanced with the proceeds of the Bond
(including the 2010 Bonds) relate. The County further covenants that it will comply with any
limitations on the use of the projects refinanced with the proceeds of the Bond by other than state
and local governmental users that are necessary, in the opinion of its bond counsel, to preserve
the tax exemption of the interest on the Bond. The covenants of this section are specified solely
to assure the continued exemption from regular income taxation of the interest on the Bond.
(c) Modification of Tax Covenants. The covenants of this section are specified solely
to assure the continued exemption from regular income taxation of the interest on the Bond. To
that end, the provisions of this section may be modified or eliminated without any requirement
for formal amendment thereof upon receipt of an opinion of the County’s bond counsel that such
modification or elimination will not adversely affect the tax exemption of interest on the Bond.
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(d) Designation. The County hereby designates the Bond as a “qualified tax-exempt
obligation” for investment by financial institutions under Section 265(b)(3) of the Code. The
County does not anticipate that it will issue more than $10,000,000 in qualified tax-exempt
obligations during 2020 (excluding obligations permitted by the Code to be excluded for
purposes of the County’s qualification as a qualified small issuer).
Section 9. Bond Fund; Pledge of Funds and Credit. A special fund of the County to
be known as the “Fund #____ – 2020 GO Bond” (which name of fund may be added to or
changed prior to closing, as directed by the Designated Representative), is hereby authorized and
directed to be created in the office of the Treasurer. The taxes hereafter levied for the purpose of
paying principal of and interest on the Bond and other funds to be used to pay the Bond shall be
deposited in the Bond Fund no later than the date such funds are required for the paymen t of
principal of and interest on the Bond. The Bond Fund shall be drawn upon for the sole purpose
of paying the principal of and interest on the Bond. Money in the Bond Fund not needed to pay
the interest or principal next coming due may temporarily be deposited in such institutions or
invested in such obligations as may be lawful for the investment of County funds.
The County hereby irrevocably covenants and agrees for as long as the Bond is
outstanding and unpaid that each year it will include in its budget and levy an ad valorem tax
upon all the property within the County subject to taxation in an amount that will be sufficient,
together with all other revenues and money of the County legally available for such purposes, to
pay the principal of and interest on the Bond as the same shall become due. All of such taxes so
collected and any other money to be used for such purposes shall be paid into the Bond Fund.
The County hereby irrevocably pledges that the annual tax provided for herein to be
levied for the payment of such principal and interest shall be within and as a part of the tax levy
-19- 502686980 v1
permitted to counties without a vote of the people, and that a sufficient portion of each annual
levy to be levied and collected by the County prior to the full pa yment of the principal of and
interest on the Bond will be and is hereby irrevocably set aside, pledged and appropriated for the
payment of the principal of and interest on the Bond.
The full faith, credit and resources of the County are hereby irrevocably pledged for the
annual levy and collection of said taxes and for the prompt payment of the principal of and
interest on the Bond as the same shall become due.
Section 10. Defeasance. In the event that money and/or noncallable Government
Obligations that are direct obligations of the United States or obligations unconditionally
guaranteed by the United States, maturing at such time or times and bearing interest to be earned
thereon in amounts (together with such money, if necessary) sufficient to redeem and retire part
or all of the Bond in accordance with its terms, are set aside in a special account of the County to
effect such redemption and retirement, and such money and the principal of and interest on such
Government Obligations are irrevocably set aside and pledged for such purpose, then no further
payments need be made into the Bond Fund for the payment of the principal of and interest on
the Bond so provided for, and such Bond or portion thereof shall cease to be entitled to any lien,
benefit or security of this resolution except the right to receive the money so set aside and
pledged, and such Bond shall be deemed not to be outstanding hereunder.
Section 11. Sale of the Bond. The County hereby ratifies and confirms its acceptance
of the Approved Bid, to purchase the Bond on the terms specified therein and in this resolution.
The proper County officials are hereby authorized and directed to do everything necessary for
the prompt execution and delivery of the Bond to the Bank and for the proper application and use
of the proceeds of the Bond.
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Upon the adoption of this resolution, the proper officials of the County including the
County Representative, are authorized and directed to undertake all other actions necessary for
the prompt sale, execution and delivery of the Bond and further to execute all closing certificates
and documents, including, but not limited to a separate loan or purchase agreement with the
Bank, required to effect the closing and delivery of the Bond in accordance with the terms of the
Approved Bid. In furtherance of the foregoing, the County Representative is authorized to
approve and enter into agreements for the payment of costs of issuance, including the fees and
expenses specified in the Approved Bid, including fees and out of pocket expenses of the Bank
(not to exceed $500) and other retained services, including Bond Counsel, Financial Advisor,
and other expenses customarily incurred in connection with issuance and sale of the Bond. The
disbursement of Bond proceeds to pay certain costs of issuance also may be made by the Escrow
Agent under the terms set forth in the Costs of Issuance Agreement. If the Bank utilizes the
services of outside counsel, the fees to be paid by the County shall not exceed $2,500.
Section 12. No Undertaking to Provide Ongoing Disclosure. The Bond is not subject
to Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act
of 1934, and the County makes no undertaking regarding ongoing disclosure with respect to the
Bond.
As long as the Bond is outstanding, the County will provide to the Bank the information
specified in the Approved Bid as approved by the County Representative.
Section 13. Lost, Stolen or Destroyed Bond. In case the Bond shall be lost, stolen or
destroyed, the Bond Registrar may execute and deliver a new Bond of like date, number and
tenor to the Bank thereof upon the Bank’s paying the expenses and charges of the County and
the Bond Registrar in connection therewith and upon its filing with the County evidence
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satisfactory to the County and the Bond Registrar that such Bond was actually lost, stolen or
destroyed and of its ownership thereof, and upon furnishing the County and Bond Registrar with
indemnity satisfactory to the County.
Section 14. Additional Covenants.
(a) The County shall provide the Bank, or provide notification of such repository
where the Bank may reasonably obtain, the County’s audited financial statements promptly upon
the receipt thereof from the Office of the Washington State Auditor, anticipated to be no later
than 270 days of the end of each fiscal year.
(b) The County shall provide the Bank with a copy of the County’s final budget upon
request, which shall in no case be prior to 45 days after the end of the prior fiscal year.
(c) The County shall provide the Bank with financial or other information as may be
reasonably requested from time to time, consistent with the obligations and limitations imposed
by RCW chapter 42.56.
(d) Upon the occurrence of any material adverse event that would impair the
performance of the County’s obligations hereunder or under the Bond, the County shall promptly
notify the Bank.
(e) The County shall not register the Bond with The Depository Trust Company or
other repository. The County will not prepare or provide any offering document, official
statement or prospectus with respect to the Bond and will not apply for a CUSIP number
assignment
(f) The County shall not object to the Bank’s pledge or grant of a security interest in
the Bank’s rights under the Bond or its related obligations.
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(g) To the extent permitted by law, the County and the Bank, as applicable, hereby
waive its right to a trial by jury in any action or proceeding arising out of, or relating to, this
resolution, the Bond, or any related documents.
(h) Upon the occurrence of a Payment Default and if the bank incurs any expenses in
connection with the enforcement of the County’s obligations to the Bank, or if the County takes
collection action in connection with the Bond, the County shall pay to the Bank, on demand, the
Bank’s reasonable costs and reasonable attorneys’ fees, whether at trial, on appear or otherwise,
including allocated costs of in-house counsel, subject to a limit of $10,000.
Section 15. Resolution and Laws a Contract with the Bank. This resolution is
adopted under the authority of and in full compliance with the Constitution and laws of the State
of Washington, including Title 36 of the Revised Code of Washington, as amended and
supplemented. In consideration of the loan made by the Bank, evidenced by the Bond, the
provisions of this resolution and of said laws shall constitute a contract with the Bank, and the
obligations of the County and its Board under said laws and under this resolution shall be
enforceable by any court of competent jurisdiction; and the covenants and agreements herein and
in the Bond set forth shall be for the equal benefit of the Bank and any permitted trans feree or
assignee.
Section 16. Severability. If one or more of the covenants or agreements provided in
this resolution to be performed on the part of the County shall be declared by any court of
competent jurisdiction to be contrary to law, then such covenant or covenants, agreement or
agreements, shall be null and void and shall be deemed separable from the remaining covenants
and agreements in this resolution and shall in no way affect the validity of the oth er provisions of
this resolution or of the Bond.
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Section 17. Effective Date. This resolution shall become effective immediately upon
its passage and approval.
ADOPTED by the Board of County Commissioners of Kittitas County, Washington, at a
regular meeting thereof held this 21st day of January, 2020.
KITTITAS COUNTY TREASURER
KITTITAS COUNTY, WASHINGTON
_____________________________________
Amy Cziske, Treasurer
BOARD OF COUNTY COMMISSIONERS
KITTITAS COUNTY, WASHINGTON
_____________________________________
Brett Wachsmith, Commissioner, Chairman
_____________________________________
Laura Osiadacz, Commissioner, Vice-
Chairman
_____________________________________
Cory Wright, Commissioner
ATTEST:
Clerk of the Board
Julie Kjorsvik
Mandy Buchholz
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EXHIBIT A
E S C R O W D E P O S I T A G R E E M E N T
KITTITAS COUNTY, WASHINGTON
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2020
THIS ESCROW AGREEMENT, dated as of __________, 2020 (herein, together with
any amendments or supplements hereto, called the “Agreement”) is entered into by and between
Kittitas County, Washington (herein called the “County”), and U.S. Bank National Association,
Seattle, Washington, as Escrow Agent (herein, together with any successor in such capacity,
called the “Escrow Agent”). The notice addresses of the County and the Escrow Agent are
shown on Exhibit A attached hereto and made a part hereof.
WIT N E S S E T H :
WHEREAS, the County heretofore has issued and there presently remain outstanding the
obligations described in Exhibit B attached hereto (the “Refunded Bonds”); and
WHEREAS, pursuant to Resolution No. 2020-____ passed on January 21, 2020 (the
“Bond Resolution”), the County has determined to issue its Limited Tax General Obligation
Refunding Bond, 2020 (the “Bond”); and
WHEREAS, the proceeds of the Bond are being used for the purpose of providing funds
to pay the costs of refunding the Refunded Bonds; and
[WHEREAS, __________________, Certified Public Accountants, of ________,
__________, has prepared a verification certificate which is dated ________ __, 2020 (the
“Verification Certificate”) relating to the source and use of funds available to accomplish the
refunding of the Refunded Bonds, the investment of such funds and the adequacy of such funds
and investments to provide for the payment of the debt service due on the Refunded Bonds; and]
WHEREAS, simultaneously herewith, the County is entering into a Cost of Issuance
Agreement with the Escrow Agent to provide for the payment of costs of issuance relating to the
Bond; and
WHEREAS, pursuant to the Bond Resolution, the Refunded Bonds have been designated
for redemption prior to their scheduled maturity dates and, after provision is made for such
redemption, the Refunded Bonds will come due in such years, bear interest at such rates, and be
payable at such times and in such amounts as are set forth in Exhibit C attached hereto and made
a part hereof; and
WHEREAS, when Escrowed Securities have been deposited with the Escrow Agent for
the payment of all principal and interest of the Refunded Bonds when due, then the Refunded
Bonds shall no longer be regarded as outstanding except for the purpose of receiving payment
from the funds provided for such purpose; and
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WHEREAS, the issuance, sale, and delivery of the Bond has been duly authorized to be
issued, sold, and delivered for the purpose of obtaining the funds required to provide for the
payment of the principal of, interest on and redemption premium (if any) on the Refunded Bonds
when due as shown on Exhibit C attached hereto;
NOW, THEREFORE, in consideration of the mutual undertakings, promises and
agreements herein contained, the sufficiency of which hereby are acknowledged, and to secure
the full and timely payment of principal of and the interest on the Refunded Bonds, the County
and the Escrow Agent mutually undertake, promise and agree for themselves and their respective
representatives and successors, as follows:
Article 1. Definitions
Section 1.1. Definitions.
Unless the context clearly indicates otherwise, the following terms shall have the
meanings assigned to them below when they are used in this Agreement:
Call Date means June 1, 2020 with respect to the Refunded Bonds.
Escrowed Securities mean the noncallable Government Obligations described in
Exhibit D attached to this Agreement, or cash or other noncallable obligations substituted
therefor pursuant to Section 4.2 of this Agreement.
Government Obligations mean direct, noncallable (a) United States Treasury
Obligations, (b) United States Treasury Obligations - State and Local Government Series,
(c) non-prepayable obligations which are unconditionally guaranteed as to full and timely
payment of principal and interest by the United States of America or (d) REFCORP debt
obligations unconditionally guaranteed by the United States.
Paying Agent means the fiscal agent of the State of Washington, as the paying agent for
the Refunded Bonds.
Refunding Account means the fund created by this Agreement to be established, held
and administered by the Escrow Agent pursuant to the provisions of this Agreement.
Section 1.2. Other Definitions.
The terms “Agreement,” “County,” “Escrow Agent,” “Bond Resolution,” “Verification
Certificate,” “Refunded Bonds,” and “Bond” when they are used in this Agreement, shall have
the meanings assigned to them in the preamble to this Agreement.
Section 1.3. Interpretations.
The titles and headings of the articles and sections of this Agreement have been inserted
for convenience and reference only and are not to be considered a part hereof and shall not in an y
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way modify or restrict the terms hereof. This Agreement and all of the terms and provisions
hereof shall be liberally construed to effectuate the purposes set forth herein and to achieve the
intended purpose of providing for the refunding of the Refunded Bonds in accordance with
applicable law.
Article 2. Deposit of Funds and Escrowed Securities
Section 2.1. Deposits in the Refunding Account.
Concurrently with the sale and delivery of the Bond the County shall deposit, or cause to
be deposited, with the Escrow Agent, for deposit in the Refunding Account, the funds (from the
proceeds of the Bond [and a cash contribution by the County]) sufficient to purchase the
Escrowed Securities described in Exhibit D attached hereto, and the Escrow Agent shall, upon
the receipt thereof, acknowledge such receipt to the County in writing.
Article 3. Creation and Operation of Refunding Account
Section 3.1. Refunding Account.
The Escrow Agent has created on its books a special trust fund and irrevocable escrow to
be known as the Refunding Account (the “Refunding Account”). The Escrow Agent hereby
agrees that upon receipt thereof it will deposit to the credit of the Refunding Account the funds
and the Escrowed Securities described in Exhibit D attached hereto. Such deposit, all proceeds
therefrom, and all cash balances from time to time on deposit therein (a) shall be the property of
the Refunding Account, (b) shall be applied only in strict conformity with the terms and
conditions of this Agreement, and (c) are hereby irrevocably pledged to the payment of the
principal of and interest on the Refunded Bonds, which payment shall be made by timely
transfers of such amounts at such times as are provided for in Section 3.2 hereof. When the final
transfers have been made for the payment of such principal of and interest on the Refunded
Bonds, any balance then remaining in the Refunding Account shall be transferred to the County,
and the Escrow Agent shall thereupon be discharged from any further duties hereunder.
Section 3.2. Payment of Principal and Interest.
The Escrow Agent is hereby irrevocably instructed to transfer to the Paying Agent from
the cash balances from time to time on deposit in the Refunding Account, the amounts required
to pay the principal of the Refunded Bonds on the Call Date and interest thereon to the Call Date
in the amounts and at the times shown in Exhibit C attached hereto.
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Section 3.3. Sufficiency of Refunding Account.
The County represents that, based upon the information provided in the Verification
Certificate, the successive receipts of the principal of and interest on the Escrowed Securities
will assure that the cash balance on deposit from time to time in the Refunding Account will be
at all times sufficient to provide moneys for transfer to the Paying Agent on the Call Date for the
Refunded Bonds in the amounts required to pay the interest on the Refunded Bonds as such
interest comes due and the principal of the Refunded Bonds as the Refunded Bonds are paid on
the Call Date, all as more fully set forth in Exhibit E attached hereto. If, for any reason, at any
time, the cash balances on deposit or scheduled to be on deposit in the Refunding Account shall
be insufficient to transfer the amounts required by the Paying Agent to make the payments set
forth in Section 3.2. hereof, the County shall timely deposit in the Refunding Account, from any
funds that are lawfully available therefor, additional funds in the amounts required to make such
payments. Notice of any such insufficiency shall be given promptly as hereinafter provided, but
the Escrow Agent shall not in any manner be responsible for any insufficiency of funds in the
Refunding Account or the County’s failure to make additional deposits thereto.
Section 3.4. Trust Fund.
The Escrow Agent or its affiliate, shall hold at all times the Refunding Account, the
Escrowed Securities and all other assets of the Refunding Account, wholly segregated from all
other funds and securities on deposit with the Escrow Agent; it shall never allow the Escrowed
Securities or any other assets of the Refunding Account to be commingled with any other funds
or securities of the Escrow Agent; and it shall hold and dispose of the assets of the Refunding
Account only as set forth herein. The Escrowed Securities and other assets of the Refunding
Account shall always be maintained by the Escrow Agent as trust funds for the benefit of the
owners of the Refunded Bonds; and a special account thereof shall at all times be maintained on
the books of the Escrow Agent. The owners of the Refunded Bonds shall be entitled to the same
preferred claim and first lien upon the Escrowed Securities, the proceeds thereof, and all other
assets of the Refunding Account to which they are entitled as owners of the Refunded Bonds.
The amounts received by the Escrow Agent under this Agreement shall not be considered as a
banking deposit by the County, and the Escrow Agent shall have no right to title with respect
thereto except as a trustee and Escrow Agent under the terms of this Agreement. The amounts
received by the Escrow Agent under this Agreement shall not be subject to warrants, drafts or
checks drawn by the County or, except to the extent expressly herein provided, by the Paying
Agent.
Article 4. Limitation on Investments
Section 4.1. Investments.
Except for the initial investment in the Escrowed Securities, the Escrow Agent shall not
have any power or duty to invest or reinvest any money held hereunder, or to make substitutions
of the Escrowed Securities, or to sell, transfer, or otherwise dispose of the Escrowed Securities.
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Article 5. Application of Cash Balances
Section 5.1. In General.
Except as provided in Section 2.1 and 3.2 and 4.2 hereof, no withdrawals, transfers or
reinvestment shall be made of cash balances in the Refunding Account.
Article 6. Redemption of Refunded Bonds
Section 6.1. Call for Redemption.
The County hereby irrevocably calls the Refunded Bonds for redemption on the Call
Date, as shown on Appendix A attached hereto.
Section 6.2. Notice of Redemption/Notice of Defeasance.
The Escrow Agent agrees to give a notice of defeasance and a notice of the redemption of
the Refunded Bonds pursuant to the terms of the Refunded Bonds and in substantially the forms
attached hereto as Appendix A attached hereto and as described on said Appendix A to the
Paying Agent for distribution as described therein. The notice of defeasance shall be given
immediately following the execution of this Agreement, and the notice of redemption shall be
given in accordance with the resolution authorizing the Refunded Bonds. The Escrow Agent
hereby certifies that provision satisfactory and acceptable to the Escrow Agent has been made for
the giving of notice of redemption of the Refunded Bonds.
Article 7. Records and Reports
Section 7.1. Records.
The Escrow Agent will keep books of record and account in which complete and accurate
entries shall be made of all transactions relating to the receipts, disbursements, allocations and
application of the money and Escrowed Securities deposited to the Refunding Account and all
proceeds thereof, and such books shall be available for inspection during business hours and
after reasonable notice.
Section 7.2. Reports.
While this Agreement remains in effect, the Escrow Agent annually shall prepare and
send to the County a written report summarizing all transactions relating to the Refunding
Account during the preceding year, including, without limitation, credits to the Refunding
Account as a result of interest payments on or maturities of the Escrowed Securities and transfers
from the Refunding Account for payments on the Refunded Bonds or otherwise, together with a
detailed statement of all Escrowed Securities and the cash balance on deposit in the Refunding
Account as of the end of such period.
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Article 8. Concerning the Escrow Agent
Section 8.1. Representations.
The Escrow Agent hereby represents that it has all necessary power and authority to enter
into this Agreement and undertake the obligations and responsibilities imposed upon it herein,
and that it will carry out all of its obligations hereunder.
Section 8.2. Limitation on Liability.
The liability of the Escrow Agent to transfer funds for the payment of the principal of and
interest on the Refunded Bonds shall be limited to the proceeds of the Escrowed Securities and
the cash balances from time to time on deposit in the Refunding Account. Notwithstanding any
provision contained herein to the contrary, the Escrow Agent shall have no liability whatsoever
for the insufficiency of funds from time to time in the Refunding Account or any failure of the
obligors of the Escrowed Securities to make timely payment thereon, except for the obligation to
notify the County promptly of any such occurrence.
The recitals herein and in the proceedings authorizing the Bond shall be taken as the
statements of the County and shall not be considered as made by, or imposing any obligation or
liability upon, the Escrow Agent.
The Escrow Agent is not a party to the proceedings authorizing the Bond or the Refunded
Bonds and is not responsible for nor bound by any of the provisions thereof (except to the extent
that the Escrow Agent may be a place of payment and paying agent and/or a paying
agent/registrar therefor). In its capacity as Escrow Agent, it is agreed that the Escrow Agent
need look only to the terms and provisions of this Agreement.
The Escrow Agent makes no representations as to the value, conditions or sufficiency of
the Refunding Account, or any part thereof, or as to the title of the County thereto, or as to the
security afforded thereby or hereby, and the Escrow Agent shall not incur any liability or
responsibility in respect to any of such matters.
It is the intention of the parties hereto that the Escrow Agent shall never be required to
use or advance its own funds or otherwise incur personal financial liability in the performance of
any of its duties or the exercise of any of its rights and powers hereunder.
The Escrow Agent shall not be liable for any action taken or neglected to be taken by it in
good faith in any exercise of reasonable care and believed by it to be within the discretion or
power conferred upon it by this Agreement, nor shall the Escrow Agent be responsible for the
consequences of any error of judgment; and the Escrow Agent shall not be answerable except for
its own neglect or willful misconduct, nor for any loss unless the same shall have been through
its negligence or bad faith.
Unless it is specifically otherwise provided herein, the Escrow Agent has no duty to
determine or inquire into the happening or occurrence of any event or contingency or the
performance or failure of performance of the County with respect to arrangements or contracts
A-7 502686980 v1
with others, with the Escrow Agent’s sole duty hereunder being to safeguard the Refunding
Account, to dispose of and deliver the same in accordance with this Agreement. If, however, the
Escrow Agent is called upon by the terms of this Agreement to determine the occurrence of any
event or contingency, the Escrow Agent shall be obligated, in making su ch determination, only
to exercise reasonable care and diligence, and in event of error in making such determination the
Escrow Agent shall be liable only for its own willful misconduct or its negligence. In
determining the occurrence of any such event or contingency the Escrow Agent may request
from the County or any other person such reasonable additional evidence as the Escrow Agent in
its discretion may deem necessary to determine any fact relating to the occurrence of such event
or contingency, and in this connection may make inquiries of, and consult with, among others,
the County at any time.
Section 8.3. Successor Escrow Agents.
If at any time the Escrow Agent or its legal successor or successors should become
unable, through operation or law or otherwise, to act as Escrow Agent hereunder, or if its
property and affairs shall be taken under the control of any state or federal court or
administrative body because of insolvency or bankruptcy or for any other reason, a vacancy shall
forthwith exist in the office of Escrow Agent hereunder. In such event the County, by
appropriate action, promptly shall appoint an Escrow Agent to fill such vacancy. If no successor
Escrow Agent shall have been appointed by the County within 60 days, a successor may be
appointed by the owners of a majority in principal amount of the Refunded Bonds then
outstanding by an instrument or instruments in writing filed with the County, signed by such
owners or by their duly authorized attorneys-in-fact. If, in a proper case, no appointment of a
successor Escrow Agent shall be made pursuant to the foregoing provisions of this section within
three months after a vacancy shall have occurred, the owner of any Refunded Bond may apply to
any court of competent jurisdiction to appoint a successor Escrow Agent. Such court may
thereupon, after such notice, if any, as it may deem proper, prescribe and appoint a successor
Escrow Agent.
Any successor Escrow Agent shall be a corporation organized and doing business under
the laws of the United States or the State of Washington, authorized under such laws to exercise
corporate trust powers, having its principal office and place of business in the State of
Washington, having a combined capital and surplus of at least $100,000,000 and subject to the
supervision or examination by federal or state authority.
Any successor Escrow Agent shall execute, acknowledge and deliver to the County and
the Escrow Agent an instrument accepting such appointment hereunder, and the Escrow Agent
shall execute and deliver an instrument transferring to such successor Escrow Agent, subject to
the terms of this Agreement, all the rights, powers and trusts of the Escrow Agent hereunder.
Upon the request of any such successor Escrow Agent, the County shall execute any and all
instruments in writing for more fully and certainly vesting in and confirming to such successor
Escrow Agent all such rights, powers and duties.
The obligations assumed by the Escrow Agent pursuant to this Agreement may be
transferred by the Escrow Agent to a successor Escrow Agent if (a) the requirements of this
Section 8.3 are satisfied; (b) the successor Escrow Agent has assumed all the obligations of the
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Escrow Agent under this Agreement; and (c) all of the Escrowed Securities and money held by
the Escrow Agent pursuant to this Agreement have been duly transferred to such successor
Escrow Agent.
Article 9. Miscellaneous
Section 9.1. Notice.
Any notice, authorization, request, or demand required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given when mailed by
registered or certified mail, postage prepaid addressed to the County or the Escrow Agent at the
address shown on Exhibit A attached hereto. The United States Post Office registered or
certified mail receipt showing delivery of the aforesaid shall be conclusive evidence of the date
and fact of delivery. Any party hereto may change the address to which notices are to be
delivered by giving to the other parties not less than ten days prior notice thereof.
Section 9.2. Termination of Responsibilities.
Upon the taking of all the actions as described herein by the Escrow Agent, the Escrow
Agent shall have no further obligations or responsibilities hereunder to the County, the owners of
the Refunded Bonds or to any other person or persons in connection with this Agreement.
Section 9.3. Binding Agreement.
This Agreement shall be binding upon the County and the Escrow Agent and their
respective successors and legal representatives, and shall inure solely to the benefit of the owners
of the Refunded Bonds, the County, the Escrow Agent and their respective successors and legal
representatives.
Section 9.4. Severability.
In case any one or more of the provisions contained in this Agreement shall for any
reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Agreement, but this Agreement shall
be construed as if such invalid or illegal or unenforceable provision had never been contained
herein.
Section 9.5. Washington Law Governs.
This Agreement shall be governed exclusively by the provisions hereof and by the
applicable laws of the State of Washington.
Section 9.6. Time of the Essence.
Time shall be of the essence in the performance of obligations from time to time imposed
upon the Escrow Agent by this Agreement.
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Section 9.7. Notice to S&P.
In the event that this Agreement or any provision thereof is severed, amended or revoked,
the County shall provide written notice of such severance, amendment or revocation to S&P
Global Ratings, 55 Water Street, New York, New York 10041, Attention: Refunded Bonds
Municipal Bond Department.
Section 9.8. Amendments.
This Agreement shall not be amended except to cure any ambiguity or formal defect or
omission in this Agreement. No amendment shall be effective unless the same shall be in
writing and signed by the parties thereto. No such amendment shall adversely affect the rights of
the holders of the Refunded Bonds. No such amendment shall be made without first receiving
written confirmation from the rating agents (if any) which have rated the Refunded Bonds that
such administrative changes will not result in a withdrawal or reduction of its rating then
assigned to the Refunded Bonds. If this Agreement is amended, prior written notice and copies
of the proposed changes shall be given to the rating agents which have rated the Refunded
Bonds.
EXECUTED as of the date first written above.
KITTITAS COUNTY, WASHINGTON
County Representative
[ESCROW AGENT]
as Authorized Signer
Exhibit A — Addresses of the County and the Escrow Agent
Exhibit B — Description of the Refunded Bonds
Exhibit C — Schedule of Debt Service on Refunded Bonds
Exhibit D — Description of Beginning Cash Deposit (if any) and Escrowed Securities
Exhibit E — Refunding Account Cash Flow
Appendix A — Notice of Redemption for the 2010 Bonds
Appendix B — Notice of Defeasance for the 2010 Bonds
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EXHIBIT A
Addresses of the County and Escrow Agent
County: Kittitas County
205 W. 5th Ave., Suite 102
Ellensburg, WA 98926
Attention: Treasurer
Escrow Agent: ________________________
________________________
________________________
________________________
Attention: _______________
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EXHIBIT B
Description of the Refunded Bonds
Kittitas County, Washington
Limited Tax General Obligation and Refunding Bonds, 2010
(Dated September 30, 2010)
Maturity Year
(December 1)
Principal Amount
Interest Rate
2020 $ 510,000 3.000%
2021 520,000 3.000
2022 530,000 3.000
2023 555,000 3.000
2024 565,000 3.125
2025 590,000 3.250
2026 610,000 3.375
2027 625,000 3.375
2028 650,000 3.500
2029 665,000 3.625
2030 690,000 3.750
A-C-1 502686980 v1
EXHIBIT C
Schedule of Debt Service on the Refunded Bonds
Date Interest
Principal/
Redemption Price Total
$ $ $
Total $ $ $
A-D-1 502686980 v1
EXHIBIT D
Escrow Deposit
I. Cash $______
II. Other Obligations
Description Maturity Date
Principal
Amount Yield Total Cost
$ % $
Total $ $
A-E-1 502686980 v1
EXHIBIT E
Refunding Account Cash Flow
Date
Escrow
Requirement
Net Escrow
Receipts
Excess
Receipts
Cash
Balance
$ $ $ $
$ $ $
Page 1—Appendix A 502686980 v1
APPENDIX A
NOTICE OF REDEMPTION*
Kittitas County, Washington
Limited Tax General Obligation and Refunding Bonds, 2010
NOTICE IS HEREBY GIVEN that Kittitas County, Washington has called for
redemption on June 1, 2020, the outstanding Limited Tax General Obligation and Refunding
Bonds, 2010 (the “Bonds”) described below.
The Bonds will be redeemed at a price of one hundred percent (100%) of their principal
amount, plus interest accrued to June 1, 2020. The redemption price of the Bonds is payable on
presentation and surrender of the Bonds at the office of:
By Mail, Hand or Overnight Mail to:
U.S. Bank National Association
Global Corporate Trust Services
111 Fillmore Ave E
St. Paul, MN 55107
Interest on all Bonds or portions thereof which are redeemed shall cease to accrue on
June 1, 2020.
The following Bonds are being redeemed:
Maturity Year
(December 1)
Principal Amount
Interest Rate
CUSIP Nos.
2020 $ 510,000 3.000% 498226AZ2
2021 520,000 3.000 498226BA6
2022 530,000 3.000 498226BB4
2023 555,000 3.000 498226BC2
2024 565,000 3.125 498226BD0
2025 590,000 3.250 498226BE8
2026 610,000 3.375 498226BF5
2027 625,000 3.375 498226BG3
2028 650,000 3.500 498226BH1
2029 665,000 3.625 498226BJ7
2030 690,000 3.750 498226BK4
By Order of Kittitas County, Washington
* This notice shall be given not more than 60 nor less than 20 days prior to June 1, 2020 by first class mail to
each registered owner of the Refunded Bonds. In addition notice shall be mailed at least __ days prior to June 1,
2020 to The Depository Trust Company of New York, New York; U.S. Bank National Association, as Fiscal Agent;
Robert W. Baird & Co.; S&P Global Ratings, and to the Municipal Securities Rulemaking Board.
Page 2—Appendix A 502686980 v1
U.S. Bank National Association, as Paying Agent
Dated: .
Withholding of 28% of gross redemption proceeds of any payment made within the
United States may be required by the Jobs and Growth Tax Relief Reconciliation Act of 2003
(the “Act”) unless the Paying Agent has the correct taxpayer identification number (social
security or employer identification number) or exemption certificate of the payee. Please furnish
a properly completed Form W-9 or exemption certificate or equivalent when presenting your
Bonds.
Page 1—Appendix B 502686980 v1
APPENDIX B
Notice of Defeasance*
Kittitas County, Washington
Limited Tax General Obligation and Refunding Bonds, 2010
NOTICE IS HEREBY GIVEN to the owners of that portion of the above captioned bonds
with respect to which, pursuant to an Escrow Agreement dated ____________ __, 2020, by and
between Kittitas County, Washington (the “County”) and _______________, ______, _______
(the “Escrow Agent”), the County has deposited into an escrow account, held by the Escrow
Agent, cash or non-callable direct obligations of the United States of America, the principal of
and interest on which, when due, will provide money to pay each year, to and including the
respective maturity or redemption dates of such bonds so provided for, the principal thereof and
interest thereon (the “2010 Bonds”). Such 2010 Bonds are therefore deemed to be no longer
outstanding pursuant to Resolution No. 2010-099 of the County authorizing the 2010 Bonds, but
will be paid by application of the assets in such escrow.
The 2010 Bonds are described as follows:
Kittitas County, Washington
Limited Tax General Obligation and Refunding Bonds, 2010
(Dated September 30, 2010)
Maturity Years
(December 1)
Par Amounts
Defeased
Interest
Rates
CUSIP Nos.
Call Date
(100%)
2020 $ 510,000 3.000% 498226AZ2 06/01/2020
2021 520,000 3.000 498226BA6 06/01/2020
2022 530,000 3.000 498226BB4 06/01/2020
2023 555,000 3.000 498226BC2 06/01/2020
2024 565,000 3.125 498226BD0 06/01/2020
2025 590,000 3.250 498226BE8 06/01/2020
2026 610,000 3.375 498226BF5 06/01/2020
2027 625,000 3.375 498226BG3 06/01/2020
2028 650,000 3.500 498226BH1 06/01/2020
2029 665,000 3.625 498226BJ7 06/01/2020
2030 690,000 3.750 498226BK4 06/01/2020
* This notice shall be given immediately by first -class mail to each registered owner of the 2010 Bonds. In
addition notice shall be mailed to The Depository Trust Company of New York, New York; Robert W. Baird & Co.;
Fitch Ratings, S&P Global Ratings, and the MSRB.
EXHIBIT B
C O S T S O F I S S U A N C E A G R E E M E N T
KITTITAS COUNTY, WASHINGTON
LIMITED TAX GENERAL OBLIGATION REFUNDING BOND, 2020
THIS COSTS OF ISSUANCE AGREEMENT, dated as of _________ __, 2020 (herein,
together with any amendments or supplements hereto, called the “Agreement”), is entered into
by and between Kittitas County, Washington, (herein called the “County”) and
___________________, ____________, ____________, as Escrow Agent (herein, together with
any successor in such capacity, called the “Escrow Agent”).
WI TNES S ET H:
WHEREAS, pursuant to Resolution No. _____ passed on January 21, 2020 (the “Bond
Resolution”), the County has determined to issue its Limited Tax General Obligation Refunding
Bond, 2020 (the “Bond”); and
WHEREAS, simultaneously herewith, the County is entering into an Escrow Deposit
Agreement, dated __________ __, 2020 under which the Escrow Agent will hold invested
proceeds of the Bond in order to pay and redeem the refunded bonds under the terms set forth
therein; and
WHEREAS, certain proceeds of the Bond will be delivered to the Escrow Agent on the
date of issuance of the Bond that are required to be disbursed to pay costs of issuance of the
Bond; and
WHEREAS, the Escrow Agent has agreed, without additional compensation to disburse
the Bond proceeds received to pay costs of issuance under the terms of this Agreement;
Section 1. Deposit in the Costs of Issuance Fund.
The Escrow Agent has created on its books a special trust fund and Refunding Account to
be known as the Costs of Issuance Fund. The Escrow Agent agrees that upon receipt it will
deposit to the credit of the Costs of Issuance Fund Account the sum of $__________ to pa y those
costs of issuance set forth on Exhibit A. Such deposit, all proceeds therefrom, and all cash
balances on deposit therein shall be the property of the Costs of Issuance Fund to pay those costs
of issuance set forth on Exhibit A upon receipt of invoices. If any of the $___________ deposit
allocated for costs of issuance for the Bond remains unspent on ____________, 2020, the
Escrow Agent shall transfer such unspent amount to the County, and this Agreement shall be
deemed fully performed and terminated.
B-2 502686980 v1
Section 2. Investments.
The Escrow Agent shall not have any power or duty to invest or reinvest any money held
hereunder.
Section 3. Limitation on Liability.
The liability of the Escrow Agent to transfer funds for the payment of the costs of
issuance identified herein shall be limited to the proceeds of the Bond delivered to the Escrow
Agent.
Section 4. Compensation.
The County shall pay to the Escrow Agent fees for performing the services hereunder and
under the Escrow Agreement for the expenses incurred or to be incurred by the Escrow Agent in
the administration of this Agreement and the Escrow Agreement pursuant to the terms of the Fee
Schedule attached as Exhibit B. The Escrow Agent hereby agrees that in no event shall it ever
assert any claim or lien against funds held under the Escrow Agreement for any fees for its
services, whether regular or extraordinary, as Escrow Agent, or in any other capacity, or for
reimbursement for any of its expenses as Escrow Agent or in any other capacity.
Section 5. Notice.
Any notice, authorization, request, or demand required or permitted to be given
hereunder shall be in writing and shall be deemed to have been duly given when mailed by
registered or certified mail, postage prepaid addressed to the County or the Escrow Agent at the
address shown on Exhibit A to the Escrow Agreement.
Section 6. Washington Law Governs.
This Agreement shall be governed exclusively by the provisions hereof and by the
applicable laws of the state of Washington.
B-3 502686980 v1
EXECUTED as of the date first written above.
KITTITAS COUNTY, WASHINGTON
County Representative
[ESCROW AGENT]
Authorized Signatory
Exhibit A - Costs of Issuance Schedule
Exhibit B - Fee Schedule
B-A-1 502686980 v1
EXHIBIT A
Costs of Issuance
Bond Counsel Fee (K&L Gates LLP) ...................
Escrow Agent Fee (__________) ..........................
Financial Advisor Fee (_________) ......................
Verification Agent Fee (_________) ....................
Total: ................................................................ $
B-B-1 502686980 v1
EXHIBIT B
FEE SCHEDULE
See Attached
502686980 v1
CERTIFICATE
I, the undersigned, Clerk of the Board of County Commissioners of Kittitas County,
Washington (herein called the “Board”) and keeper of the records of the County, DO HEREBY
CERTIFY:
1. That the attached Resolution is a true and correct copy of Resolution
No. 2020-____ of the County (herein called the “Resolution”), as finally adopted at a regular
meeting of the Board held on the 21st day of January, 2020, and duly recorded in my office.
2. That said meeting was duly convened and held in all respects in accordance with
law, and to the extent required by law, due and proper notice of such meeting was given; that
quorum of the Board was present throughout the meeting and a legally sufficient number of
members of the Board voted in the proper manner for the approval of said Resolution; that all
other requirements and proceedings incident to the proper approval of said Resolution have been
duly fulfilled, carried out and otherwise observed, and that I am authorized to execute this
certificate.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of January, 2020.
Clerk of the Board