Title
Dept/ Agency: Finance
Action: ( ) Ratifying (X) Authorizing ( ) Amending
Type of Service: Preliminary/Official Statement and Disclosure Agreement for Issuance of Notes
Purpose: Approving official statement and disclosure agreement for sale
of bond anticipation notes and special emergency notes
Amount to be Financed: $32,368,000.00
Project Information:
(Description/ Project No./Amount Appropriated/Ordinance No.)
RESOLUTION OF THE CITY OF NEWARK, IN THE COUNTY OF ESSEX, STATE OF NEW JERSEY (THE “CITY”) AUTHORIZING AND APPROVING (A) THE SALE AND ISSUANCE OF GENERAL CAPITAL IMPROVEMENT BOND ANTICIPATION NOTES, SERIES 2026G (TAX-EXEMPT) OF THE CITY, (B) THE PREPARATION AND DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT AND FINAL OFFICIAL STATEMENT IN CONNECTION THEREWITH, (C) THE ENTERING INTO AND EXECUTION OF A CONTINUING DISCLOSURE CERTIFICATE IN CONNECTION THEREWITH, AND (D) CITY OFFICIALS TO UNDERTAKE OTHER ACTIONS IN CONNECTION THEREWITH
Additional Information:
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WHEREAS, the City of Newark, in the County of Essex, State of New Jersey (the "City"), has heretofore issued $33,951,000.00 General Capital Improvement Bond Anticipation Notes, Series 2025E (Tax-Exempt) (the “Prior Notes”) on September 24, 2025, which Prior Notes mature on September 23, 2026; and
WHEREAS, the Prior Notes were issued to (i) currently refund a portion of the City’s $30,674,000.00 General Capital Improvement Bond Anticipation Notes, Series 2024C (Tax-Exempt) (the “Series 2024C BAN Notes”) (a $1,583,000.00 principal portion of the Series 2024C BAN Notes was paid by the City with a 2025 budget appropriation), and (ii) temporarily finance various capital improvements in and for the City in the amount of $4,860,000.00, which Series 2024C BAN Notes were issued to currently refund a portion of the City’s $31,628,000.00 General Capital Improvement Bond Anticipation Notes, Series 2023B (the “Series 2023B BAN Notes”) (a $954,000.00 principal portion of the Series 2023B BAN Notes was paid by the City with a 2024 budget appropriation), which Series 2023B BAN Notes were issued to currently refund the City’s General Capital Improvement Bond Anticipation Notes, Series 2022D (the “Series 2022D BAN Notes”), which Series 2022D BAN Notes were issued to currently refund a portion of the City’s General Capital Improvement Bond Anticipation Notes, Series 2021E (the “Original BAN Notes”), which Original BAN Notes were issued to fund various capital improvements throughout the City and to pay costs of issuance associated therewith; and
WHEREAS, the City desires to sell and issue $32,368,000.00 General Capital Improvement Bond Anticipation Notes, Series 2026G (Tax-Exempt) (the “Notes”) to currently refund, together with a 2026 budgetary appropriation of the City in the amount of $1,583,000.00, the Prior Notes, all pursuant to the Local Bond Law, N.J.S.A. 40A:2-1 et seq, as amended and supplemented (the “Local Bond Law”), specifically N.J.S.A. 40A:2-28, the Ordinance (as defined below), and this resolution (the “Resolution”); and
WHEREAS, the City now wishes to authorize and implement the issuance of the Notes and any and all actions related thereto via the adoption of this Resolution; and
WHEREAS, pursuant to, and in accordance with, (i) the Local Bond Law and (ii) bond ordinance number 6PSF-a(s) duly adopted on June 22, 2021 by the Municipal Council of the City, approved by the Mayor, and published as required by law (the “Ordinance”), the City is seeking to authorize the sale and issuance of the Notes; and
WHEREAS, the City, in order to issue the Notes at competitive market rates, seeks to, among other things, authorize the preparation, execution and distribution of, as applicable, a Preliminary Official Statement (as hereinafter defined) and an Official Statement (as hereinafter defined); and
WHEREAS, the City, also seeks to, among other things, authorize the preparation, execution and delivery of, as applicable, the Notes, a Continuing Disclosure Certificate (as hereinafter defined), a Tax Certificate (as hereinafter defined), as and if applicable, and any other agreements or documents required for the authorization, sale, issuance, execution and delivery of the Notes.
NOW, THEREFORE, BE IT RESOLVED BY THE MUNICIPAL COUNCIL OF THE CITY OF NEWARK, IN THE COUNTY OF ESSEX, STATE OF NEW JERSEY THAT:
1. The recitals set forth above are incorporated herein as if fully set forth herein.
2. Authorization of Notes. The City is hereby authorized to sell and issue not to exceed $32,368,000.00 aggregate principal amount of Notes.
Pursuant to the provisions of the Local Bond Law, the Ordinance, and this Resolution, the Acting Director of Finance and Interim Chief Financial Officer is hereby authorized and directed to sell, issue, execute and deliver the Notes. The Notes will be dated their date of delivery and shall mature not later than one (1) year from their date as shall be determined by the Acting Director of Finance and Interim Chief Financial Officer. The Notes may be renewed from time to time in accordance with the provisions of the Local Bond Law. The Notes shall not be subject to redemption prior to maturity.
3. The Acting Director of Finance and Interim Chief Financial Officer is hereby authorized, at his or her discretion, and based upon the advice of Wilentz, Goldman & Spitzer, P.A., bond counsel to the City (“Bond Counsel”), and NW Financial Group, LLC, the municipal advisor to the City (the “Municipal Advisor”), in accordance with the Ordinance, to sell the Notes on a competitive basis and to award the Notes to the bidder based upon the submission of a conforming bid of the lowest net interest cost or true interest cost. The Acting Director of Finance and Interim Chief Financial Officer is also authorized, at his or her discretion, and based upon the advice of Bond Counsel and the Municipal Advisor, in accordance with the applicable provisions of the Ordinance, to offer and sell the Notes on a negotiated basis.
4. Authorization for Official Statement. The preparation by the City and the Municipal Advisor of a Preliminary Official Statement (the “Preliminary Official Statement”) relating to the Notes is hereby authorized. The distribution by the City of the Preliminary Official Statement, in substantially the form attached hereto as Exhibit A, to be used in connection with the marketing and sale of the Notes, is hereby authorized and approved, with such insertions, deletions and changes therein and any supplements thereto as Bond Counsel and the Municipal Advisor to the City may advise and recommend and an Authorized Officer of the City (as hereinafter defined) may approve. The Mayor, Business Administrator, and Acting Director of Finance and Interim Chief Financial Officer of the City (each an “Authorized Officer(s)”) are each hereby authorized and directed, on behalf of the City, to execute and deliver a certificate that “deems final” the Preliminary Official Statement in accordance with the Rule (as hereinafter defined).
After the sale of the Notes, the Preliminary Official Statement shall be modified to reflect the effect of the sale of the Notes and any other revisions not inconsistent with the substance thereof; and said Preliminary Official Statement, deemed “final” by an Authorized Officer in accordance with the Rule, as so modified, shall constitute the final Official Statement (the “Official Statement”). The Authorized Officers are each hereby authorized and directed on behalf of the City to execute and deliver the Official Statement.
5. Authorization for Notice of Sale. The Acting Director of Finance and Interim Chief Financial Officer is hereby delegated, authorized and directed, on behalf of the City, to sell and award the Notes to the successful bidder therefor pursuant to the terms and conditions of a Notice of Sale for the Notes (the “Notice of Sale”). The form of the Notice of Sale, in substantially the form attached hereto as Exhibit B, is hereby approved, and the execution of a Notice of Sale by the Acting Director of Finance and Interim Chief Financial Officer is hereby authorized with such changes as may be approved by Bond Counsel and/or the Municipal Advisor. The Municipal Advisor is hereby authorized to distribute the Notice of Sale in connection with the offering, marketing, and sale of the Notes.
6. Prior Actions and Execution of Notes. All actions taken to date by the Authorized Officers, employees, professionals and agents of the City, including Bond Counsel, the Municipal Advisor, and the Auditor (as hereinafter defined), with respect to the authorization, sale, issuance, execution and delivery of the Notes, including, but not limited to, submissions and applications to rating agencies and the distribution and dissemination of the Preliminary Official Statement and the Notice of Sale, are hereby approved, ratified, adopted and confirmed, and each Authorized Officer is hereby authorized and directed to execute and deliver the Notes and any such agreements, documents or submissions required for the authorization, sale, issuance, execution and delivery of the Notes, and the City Clerk or Deputy Clerk is hereby authorized and directed to attest to the signatures of the Authorized Officers and to affix, imprint or reproduce the seal of the City on such Notes and, as applicable, on any such agreements, documents or submissions related to the authorization, sale, issuance, execution and delivery of the Notes. All Notes issued pursuant to this Resolution shall be executed by the Acting Director of Finance and Interim Chief Financial Officer and the Mayor of the City, or such other Authorized Officer, under the seal of the City and the signatures of such officers shall be attested by the City Clerk or Deputy Clerk. The Authorized Officers are each hereby authorized and directed to execute and deliver all documents necessary or convenient in connection with the authorization, sale, issuance, execution and delivery of the Notes.
7. All other details or requirements of, as applicable, the Ordinance and the Local Bond Law shall be determined and approved by an Authorized Officer of the City, upon consultation with Bond Counsel, the Municipal Advisor, and Samuel Klein and Company, CPAs, Auditor to the City (the “Auditor”), and such approvals are to be conclusively evidenced by his or her execution of the Notes as provided herein or on any other document, certificate, agreement or instrument related to the authorization, sale, issuance, execution and delivery of the Notes.
8. Continuing Disclosure. The City hereby covenants and agrees to comply with the secondary market disclosure requirements of Rule 15c2-12, as amended (the “Rule”), promulgated by the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended, and agrees to covenant to such compliance, as required, in a Continuing Disclosure Certificate (the “Continuing Disclosure Certificate”), in substantially the form attached hereto as Exhibit C. In connection therewith, an Authorized Officer of the City, in consultation with Bond Counsel, the Municipal Advisor, and the Auditor to the City, is hereby authorized and directed to enter into and execute the Continuing Disclosure Certificate, evidencing the contractual undertaking of the City to comply with the requirements of the Rule, and to deliver the Continuing Disclosure Certificate in connection with the offer and sale of the Notes. Notwithstanding the foregoing, failure of the City to comply with the covenants set forth in the Continuing Disclosure Certificate shall not be considered a default on the Notes; however, any Noteholder may take such actions as may be necessary and appropriate, including seeking mandamus or specific performance, to cause the City to comply with its obligations hereunder and thereunder. The Authorized Officers, and any professionals or agents of the City acting on its behalf, are each hereby authorized and directed to execute and deliver all certificates, documents and agreements in connection therewith and, if necessary, to file budgetary, financial and operating data on an annual basis and notices of certain enumerated events as required to comply with, and in accordance with, the provisions of the Rule.
9. Rating. The Acting Director of Finance and Interim Chief Financial Officer is hereby authorized and directed, upon consultation with Bond Counsel, the Municipal Advisor, and the Auditor to the City, to, if applicable, submit information and financial data on the City to rating agencies to obtain a rating on the Notes.
10. Tax Matters. To the extent that the Notes are issued as tax exempt obligations (which determination shall be made prior to sale), the City shall covenant in a Tax and Arbitrage Certificate (the “Tax Certificate”) that it will comply with the provisions of the Internal Revenue Code of 1986, as amended (the “Code”), and that it will take no action or omit to take any action that would cause the interest on such Notes to lose its tax exemption under the Code. The Acting Director of Finance and Interim Chief Financial Officer is hereby authorized and directed to execute and deliver the Tax Certificate in connection with the issuance and closing of the Notes.
11. The Acting Director of Finance and Interim Chief Financial Officer is hereby authorized and directed to determine all matters and terms in connection with the sale and issuance of the Notes, as applicable (including adjusting the principal amount of the Notes (not in excess of the amount authorized in Section 2 hereof)), the terms set forth in the Notice of Sale, and/or any matters set forth in this Resolution that are deemed necessary and advisable to change by the Acting Director of Finance and Interim Chief Financial Officer of the City in consultation with Bond Counsel, the Municipal Advisor, and the Auditor, prior to the sale or closing of the Notes, as applicable.
12. Further Action. The sale and issuance of the Notes is hereby authorized and approved. The terms and provisions of the Notes (including, without limitation, registered or book-entry form, the aggregate principal amount, the maturity date, interest rate and redemption provisions) shall be determined by the Acting Director of Finance and Interim Chief Financial Officer of the City as authorized by the Local Bond Law, the Ordinance heretofore adopted by the Municipal Council, and this Resolution. The Authorized Officers are each authorized and directed to take all actions which are necessary or convenient to effectuate the terms of this Resolution and the issuance, sale and delivery of the Notes, including, but not limited to, the execution and delivery of the Continuing Disclosure Certificate, the Tax Certificate, and closing certificates, documents, agreements, instruments, and opinions in connection therewith, in consultation with, and upon the advice of, Bond Counsel, the Municipal Advisor, and the Auditor. The Authorized Officers are hereby authorized and directed to execute and deliver all documents necessary or convenient in connection with the issuance, sale and delivery of the Notes. All such actions heretofore or hereafter taken by the Authorized Officers and professionals of the City are hereby ratified, approved, and confirmed.
13. Pledge of the City. The full faith and credit of the City are hereby pledged to the punctual payment of the principal of and the interest on the Notes authorized by this Resolution. The Notes shall be direct, unlimited obligations of the City. The City shall have the power and shall be obligated to levy ad valorem taxes upon all taxable property within the City for the payment of such Notes and interest thereon, without limitation as to rate or amount.
14. Effective Date. This Resolution shall take effect immediately upon adoption.
STATEMENT
Resolution authorizing and approving the sale and issuance of General Capital Improvement Bond Anticipation Notes, the preparation and distribution of a Preliminary Official Statement and Final Official Statement, and entering into and execution of a Continuing Disclosure Certificate.