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BOND ORDINANCE OF THE CITY OF NEWARK, IN THE COUNTY OF ESSEX, NEW JERSEY, ON BEHALF OF THE STATE-OPERATED SCHOOL DISTRICT OF THE CITY OF NEWARK, PROVIDING FOR VARIOUS SCHOOL CAPITAL PROJECTS AND APPROPRIATING $30,582,031.00 THEREFOR, AND PROVIDING FOR THE ISSUANCE OF $30,582,031.00 OF SCHOOL QUALIFIED BONDS OR NOTES OF THE CITY OF NEWARK TO FINANCE THE COSTS THEREOF
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WHEREAS, the State-Operated School District of the City of Newark in the County of Essex (the “City”) is a legally constituted school district and corporate entity under the laws of the State of New Jersey (the “School District”) and currently organized pursuant to the provisions of the Public Laws of 1987, Chapter 399, N.J.S.A. 18A:7A-34 et seq. (the “State Take-Over Act”); and
WHEREAS, the State Take-Over Act requires the School District to submit its capital financing proposals to the Capital Projects Control Board to review the financing of any capital project proposed by the State District Superintendent of the School District; and
WHEREAS, the Capital Projects Control Board met several times to discuss the financing of various capital improvements to be undertaken by the School District in conjunction with the New Jersey Schools Construction Corporation, pursuant to the requirements of the Educational Facilities Construction and Financing Act, N.J.S.A. 18A:7G-1 et seq. (the “Facilities Act”); and
WHEREAS, the State Take-Over Act requires the Municipal Council of the City of Newark in the County of Essex, New Jersey (the “Council”) to issue bonds or notes pursuant to the provisions of the Local Bond Law, N.J.S.A. 40A:2-1 et seq. (the “Local Bond Law”) and the School Qualified Bond Act, N.J.S.A. 18A:24-85 et seq. (the “School Qualified Bond Act” and together with the Local Bond Law, the “Acts”) to finance the school capital projects set forth in Section 3 hereof (the “School Projects”) in an amount not to exceed $30,582,031.00; and
WHEREAS, a copy of the resolution approving the issuance of the bonds or notes by the Capital Projects Control Board has been delivered to the State District Superintendent, the Commissioner of Education, the Director of the Division of Local Government Services in the Department of Community Affairs, and the City Clerk for the Municipal Council; and
WHEREAS, it is necessary and desirable that the School Projects be undertaken and that the cost thereof be financed by the issuance of school bonds or notes of the City.
NOW, THEREFORE, BE IT ORDAINED AND ENACTED BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, IN THE COUNTY OF ESSEX, NEW JERSEY THAT:
Section 1. Pursuant to the provisions of the Acts, there is hereby appropriated the respective sums of money for the financing of the School Projects set forth in Section 3.
Section 2. In order to finance the cost of the School Projects, negotiable school bonds (“School Bonds”) of the City are hereby authorized to be issued in the aggregate principal amount of $30,582,031.00 pursuant to the Acts. In anticipation of the issuance of the School Bonds by the City, negotiable temporary notes or loan bonds (collectively, “Notes”) are hereby authorized to be issued pursuant to and within the limitations prescribed by the Acts.
Section 3. The several improvements hereby authorized and the several purposes for which the School Bonds are to be issued, the estimated cost of each improvement and the appropriation therefor, the maximum amount of School Bonds or Notes to be issued for each improvement and the period of usefulness of each improvement are as follows:
(a) Fire Suppression System Upgrades
1. Purpose: Upgrades to fire suppression system deficiencies at several schools to comply with Newark Fire Department standards at several schools including but not limited to 13th Avenue, 14th Avenue, Branch Brook, Dayton Street, Dr. Alma Flagg, Hawkins Street, Ivy Hill, J.F.K., L.M. Marin, Mount Vernon, Newark Vocational, Quitman, Roberto Clemente, South Street Academy, Technology High and West Side High.
Appropriation and Estimated Cost: $376,753.00
Maximum Amount of School Bonds or Notes: $376,753.00
Period or Average Period of Usefulness: 10 years
(b) Fire Alarm System Upgrades
1. Purpose: Replace outdated and malfunctioning fire alarm systems at several schools including 14th Avenue, Abington Avenue, Arts High, Branch Brook, Dr. Horton, E.C.C. Central, History High, Mount Vernon, Peshine Avenue and Roberto Clemente.
Appropriation and Estimated Cost: $6,931,883.00
Maximum Amount of School Bonds or Notes: $6,931,883.00
Period or Average Period of Usefulness: 10 years
(c) Battery Back-Up Emergency Lighting
1. Purpose: Replace and install battery back-up emergency lighting where generators are non-operational at several schools.
Appropriation and Estimated Cost: $107,455.00
Maximum Amount of School Bonds or Notes: $107,455.00
Period or Average Period of Usefulness: 10 years
(d) HVAC Upgrades
1. Purpose: Upgrade and replace boilers, air handlers, chillers, controls, remote sensors and thermostats at several schools including but not limited to 14th Avenue, Abington Avenue, Dr. Alma Flagg, Dr. Horton, G.W. Carver, J.F.K., Rafael Hernandez, Science Park, South 17th Street and Wilson Avenue.
Appropriation and Estimated Cost: $8,123,843.00
Maximum Amount of School Bonds or Notes: $8,123,843.00
Period or Average Period of Usefulness: 10 years
(e) Electrical Service Upgrades
1. Purpose: New generators and panel/service upgrades at Dr. Horton and J.F.K. schools.
Appropriation and Estimated Cost: $49,800.00
Maximum Amount of School Bonds or Notes: $49,800.00
Period or Average Period of Usefulness: 10 years
(f) Elevator Upgrades
1. Purpose: Modernize and upgrade elevators at J.F.K. and East Side schools.
Appropriation and Estimated Cost: $840,000.00
Maximum Amount of School Bonds or Notes: $840,000.00
Period or Average Period of Usefulness: 10 years
(g) Gymnasium Upgrades
1. Purpose: Repair and replace bleachers and gymnasium floors at History High and Harriet Tubman schools.
Appropriation and Estimated Cost: $372,000.00
Maximum Amount of School Bonds or Notes: $372,000.00
Period or Average Period of Usefulness: 10 years
(h) Plumbing Upgrades
1. Purpose: Replace and install new hot water tanks, storage tanks, pumps and associated piping at several schools including Cleveland, Hawkins Street, Hawthorne Avenue, Lafayette Street and Lincoln.
Appropriation and Estimated Cost: $836,390.00
Maximum Amount of School Bonds or Notes: $836,390.00
Period or Average Period of Usefulness: 10 years
(i) Emergency Generator Replacement
1. Purpose: Replace and install emergency generators and emergency lights district-wide at several schools including Chancellor Avenue, Dr. Horton, E.C.C. West, East Side High, G.W. Carver, Harriet Tubman, Hawthorne Avenue, Lafayette Street, Newark Vocational, Quitman Street, South 17th Street and Wilson Avenue.
Appropriation and Estimated Cost: $1,828,715.00
Maximum Amount of School Bonds or Notes: $1,828,715.00
Period or Average Period of Usefulness: 10 years
(j) Building, Lead Paint and Water Assessment and Remediation
1. Purpose: Obtain comprehensive district-wide building assessment and undertake remediation to remove lead paint and install water filtration system.
Appropriation and Estimated Cost: $2,065,000.00
Maximum Amount of School Bonds or Notes: $2,065,000.00
Period or Average Period of Usefulness: 5 years
(k) Building Envelope/Structural Renovations
1. Purpose: Roof, masonry, door, window, exterior and critical structural renovations at several schools including but not limited to Arts High, Benjamin Franklin, Cleveland, Hawkins Street, History High, J.F.K., L.M. Marin, Newton Street, South 17th Street, University High and West Side High.
Appropriation and Estimated Cost: $8,413,936.00
Maximum Amount of School Bonds or Notes: $8,413,936.00
Period or Average Period of Usefulness: 20 years
(l) Technology/Equipment
1. Purpose: Purchase and install new servers, wiring, wireless and computer infrastructure and equipment upgrades at several schools including but not limited to Abington Avenue, Dr. Horton, Lincoln, Malcolm X. Shabazz High, Ridge Street, Speedway, and Central Office.
Appropriation and Estimated Cost: $636,256.00
Maximum Amount of School Bonds or Notes: $636,256.00
Period or Average Period of Usefulness: 10 years
(m) All School Projects shall include all work, appurtenances and materials necessary therefor or incidental thereto.
(n) The maximum amount of School Bonds or Notes to be issued for the improvements or purposes set forth in Section 3 hereof is as stated in Section 2 hereof.
(o) The estimated cost of the several improvements or purposes is equal to the amount of the appropriation herein made therefor.
(p) Pursuant to the Acts, the weighted average useful life of the School Projects is 12.31 years.
Section 4. All Notes issued hereunder shall mature at such times as may be determined by the Chief Financial Officer, provided that no note shall mature later than one (1) year from its date. The Notes shall bear interest at such rate or rates and be in such form as may be determined by the Chief Financial Officer. The Chief Financial Officer shall determine all matters in connection with Notes issued pursuant to this bond ordinance, and the Chief Financial Officer's signature upon the Notes shall be conclusive evidence as to all such determinations. All Notes issued hereunder may be renewed from time to time subject to the provisions of the Acts. The Chief Financial Officer is hereby authorized and directed to sell part or all of the Notes from time to time at public or private sale and to deliver them to the purchasers thereof upon receipt of payment of the purchase price plus accrued interest from their dates to the date of delivery thereof. The Chief Financial Officer is directed to report in writing to the State District Superintendent, the School District and Governing Body at the meeting next succeeding the date when any sale or delivery of the Notes pursuant to this bond ordinance is made. Such report must include the amount, the description, the interest rate and the maturity schedule of the notes sold, the price obtained and the name of the purchaser.
Section 5. The following additional matters are hereby determined, declared, recited and stated:
(a) The several improvements or purposes described in Section 3 of this bond ordinance are not current expenses and are improvements or purposes the City may lawfully undertake as School Projects.
(b) The average period of usefulness of the School Projects authorized herein is in accordance with N.J.S.A. 18A:24-5.
(c) The Supplemental Debt Statement required by N.J.S.A. 18A:24-16 and -17 has been duly prepared and filed in the Office of the City Clerk and in the Office of the State District Superintendent, and a complete executed duplicate has been filed in the office of the Director of the Division of Local Government Services in the Department of Community Affairs of the State of New Jersey. The obligations authorized herein shall be included for purposes of calculating the net school debt of the School District pursuant to N.J.S.A. 18A:24-19, but shall be deducted from the gross debt of the City pursuant to N.J.S.A. 40A:2-44(a).
(d) It is anticipated that each of the School Bonds authorized herein will be issued as School Qualified Bonds pursuant to and entitled to the benefits of the School Qualified Bonds Act, and shall be designated as such to the extent that all approvals and conditions relating to the issuance of School Qualified Bonds have been obtained and satisfied, as the case may be. Within ten (10) days after the date of the issuance of qualified bonds, the City shall certify to the State Treasurer the name and address of the Paying Agent, the amount, the maturity schedule, interest rate and date of payment of the debt service on such qualified bonds. The bonds must be registered bonds, registered as to both principal and interest, or as consistent with any applicable law in effect as of the date of issuance. The form, date, denomination, interest rate and maturity of the bonds shall be as hereafter determined by resolution of the Municipal Council.
Section 6. The full faith and credit of the City is hereby pledged to the punctual payment of the principal of and the interest on the obligations authorized by this bond ordinance. The obligations shall be direct, unlimited obligations of the City, and the City shall be obligated to levy ad valorem taxes upon all the taxable real property within the City for the payment of the obligations and the interest thereon without limitation of rate or amount.
Section 7. The City may expend monies of the City if the School District undertakes certain of the capital projects identified herein prior to the issuance of any School Bonds or Notes hereunder. This is hereby the City’s statement of official intent to reimburse the School District or the City out of the proceeds of any School Bonds or Notes issued hereunder for such expenditures pursuant to regulations promulgated under the Internal Revenue Code of 1986, as amended (the “Code”).
Section 8. The City hereby covenants to take any action necessary or refrain from taking such action in order to preserve the tax-exempt status of the bonds and notes authorized hereunder issued as tax-exempt
Bonds or Notes as is or may be required under the Code, including compliance with the Code with regard to the use, expenditure, investment, timely reporting and rebate of investment earnings as may be required thereunder.
Section 9. This bond ordinance shall take effect 20 days after the first publication thereof after final adoption and approval by the Mayor, as provided by law.
STATEMENT
Ordinance on behalf of the State-Operated School District of the City of Newark, providing for various School Capital projects and appropriating $30,582,031.00 and providing issuance of School Qualified Bond or Notes to finance the costs thereof.