Chapter 3.09
LOCAL IMPROVEMENT GUARANTY FUND
Sections:
3.09.030 Payment upon default.
3.09.060 Rules and regulations for use of funds.
3.09.010 Levy – Limit.
The city council, at the time of making its annual budget and tax levy, shall provide for the levy of a sum sufficient, with the other sources of the guaranty fund, to pay warrants issued against the guaranty fund during the preceding fiscal year and to maintain a balance therein. In no event shall the levy in any one year exceed the greater of: (1) 12 percent of the outstanding obligations guaranteed by the guaranty fund; or (2) the total amount of delinquent assessments and interest accumulated on the delinquent assessments before the levy as of September 1st of that year. (Ord. 887 § 1, 1986).
3.09.020 Investment.
The money held in the guaranty fund may be invested in any lawful investment of city funds and the city finance director is authorized and directed to pay into the guaranty fund all interest received from the investment of money on deposit in the guaranty fund as well as any surplus remaining in any local improvement fund after the payment of all outstanding bonds, warrants or other short-term financing payable out of the guaranty fund. (Ord. 887 § 2, 1986).
3.09.030 Payment upon default.
A. Whenever any bond, warrant or other short-term obligation guaranteed under the provisions of the laws of the state of Washington in pursuance of which the ordinance codified in this chapter is passed shall be in default, upon the presentment and delivery of any such defaulted bond, warrant or other short-term obligation, the city finance director shall purchase the same by executing, duly issuing and delivering a warrant drawn on the guaranty fund to the person presenting the same, and the city finance director shall honor and pay a warrant on the guaranty fund in such amount as may be necessary to pay in full any such bond, warrant or other short-term obligation with any interest to be held for the benefit of the guaranty fund. If more than one bond, warrant or other short-term obligation is so presented, they shall be purchased in their order of presentment.
B. Whenever any interest payment guaranteed under the laws of the state of Washington in pursuance of which the ordinance codified in this chapter is passed shall be in default, upon the presentment and delivery of the defaulted interest coupon or, in the absence of coupons, proof of ownership of the bond and proof of default in the payment of interest thereon, the city finance director shall pay such interest in the same manner as set forth in subsection (A) of this section for payment of bonds, warrants or other short-term obligations in default. In the absence of coupons, a certificate of the bond registrar that the interest due has not been paid shall be and is presumed to be adequate proof of default. (Ord. 887 § 3, 1986).
3.09.040 Warrants – Issuance.
Warrants drawing interest at a rate not to exceed 18 percent per annum shall be issued as other warrants are issued by the city against the guaranty fund to meet any liability accruing against it. Such warrants shall at no time exceed five percent of the outstanding obligations guaranteed by the guaranty fund. (Ord. 887 § 4, 1986).
3.09.050 Transfer of funds.
Upon certification by the city finance director that the guaranty fund has sufficient funds currently on hand to meet all valid outstanding obligations of the guaranty fund and all obligations of the guaranty fund reasonably expected to be incurred in the near future, the city by ordinance may provide for the transfer of assets from the guaranty fund to the city’s general fund, except that the net cash of the guaranty fund may not be reduced by such transfer to an amount less than 10 percent of the net outstanding obligations guaranteed by such fund.
If at any time within five years of any transfer of assets from the guaranty fund to the general fund the net cash of the guaranty fund is reduced below 10 percent of the net outstanding obligations guaranteed by the guaranty fund, the city, to the extent of the amount transferred, shall pay valid claims against the guaranty fund as a general obligation of the city and shall pay all reasonable costs of collection necessarily incurred by the holders of valid claims against the guaranty fund. (Ord. 887 § 5, 1986).
3.09.060 Rules and regulations for use of funds.
The ordinance codified in this chapter constitutes the rules and regulations for the maintenance and operation of the guaranty fund. Money of the guaranty fund also may be used for and in such manner as is or may hereafter be authorized by Chapter 35.54 RCW. (Ord. 887 § 6, 1986).