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HomeMy WebLinkAboutVI(F) Discussion/ Action Re: Resolution No. 96-35, Awarding 1997 Water/ Sewer Bonds AGENDA 12-17-96 ( ( Item VI F "CENTER OF GOOD LIVING PRIDE OF WEST ORANGE" ••�•� -- �� OCOee 1 S.SCOTT VANDERGRIFT Q� COMMISSIONERS 0 RUSTY JOHNSON a CITY OF OCOEE SCOTTANDERSON O 150 N.LAKESHORE DRIVE SCOTT A.GLASS OCOEE,FLORIDA 34761-2258 JIM GLEASON 44 �� (407)656-2322 CITY MANAGER R ®f 0000 ELLIS SHAPIRO MEMORANDUM TO: The Honorable Mayor and Board of City Commissioners FROM: Wanda Horton, Finance Director DATE: December 13, 1996 RE:. Award Resolution for Series 1997 Bonds; Execution of Bond Purchase Contract The City of Ocoee adopted a bond resolution on December 3, 1996, setting forth the covenants to the bondholders and approving certain water and sewer projects. William R. Hough & Co. is now marketing the City's Series 199.7 Bonds, using the attached Preliminary Official Statement. At the meeting on December 17th, a finalized Bond Purchase Contract will be offered by Hough for approval and signature, which will include the final interest rates and terms for the negotiated underwriting. Resolution 96- 35 was prepared by City Bond Council and reviewed by the City Attorney. Adoption of the Award Resolution will approve the execution by the City of the Bond Purchase Contract, set the actual terms for the Series 1997 Bonds and appoint First Union National Bank of Florida as the Registrar and Paying Agent. RECOMMENDATION: Based upon Staff and the Financial Advisor's approval of the financial terms, it is respectfully recommended that the Honorable Mayor and City Commission approve and adopt the Award Resolution and authorize the Mayor and City Clerk to execute the necessary documents. eGt to :r RESOLUTION 96-3 5 A RESOLUTION AUTHORIZING THE NEGOTIATED SALE OF $ CITY OF OCOEE, FLORIDA, WATER AND SEWER SYSTEM IMPROVEMENT REVENUE BONDS, SERIES 1997; AWARDING THE SALE THEREOF TO WILLIAM R. HOUGH & CO., SUBJECT TO THE TERMS AND CONDITIONS OF A PURCHASE CONTRACT; AUTHORIZING THE DISTRIBUTION OF A FINAL OFFICIAL STATEMENT IN CONNECTION WITH THE DELIVERY OF THE BONDS; APPOINTING A REGISTRAR AND PAYING AGENT; PROVIDING CERTAIN OTHER MATTERS IN CONNECTION THEREWITH; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Ocoee, Florida (the "Issuer"), has by Resolution 93-02 adopted on February 2, 1993, and Resolution 96-32 adopted on December 3, 1996 (collectively, the "Resolution"), authorized the issuance of not to exceed $15,000,000 City of Ocoee, Florida, Water and Sewer System Improvement Revenue Bonds, Series 1997, to finance the Project (as defined in the Resolution); and WHEREAS, due to the present instability in the market for revenue obligations the interest on which is excluded from federal gross income, the critical importance of the timing of the sale of the Bonds, and due to the willingness of William R. Hough & Co. (the "Underwriter") to purchase the City of Ocoee, Florida, Water and Sewer System Improvement Revenue Bonds, Series 1997 (the "Series 1997 Bonds"), at interest rates favorable to the Issuer, it is hereby determined that it is in the best interest of the public and the Issuer to sell the Series 1997 Bonds at a negotiated sale; and WHEREAS, the Underwriter proposes to submit an offer to purchase $ of the Series 1997 Bonds, subject to the terms and conditions set forth in the Purchase Contract, a copy of which is attached hereto as Exhibit A (the "Purchase Contract"); and WHEREAS, the Issuer now desires to sell its Bonds pursuant to the Purchase Contract and in furtherance thereof to appoint a Registrar and Paying Agent and to approve the form of and authorize distribution of a final Official Statement in connection with the issuance of the Series 1997 Bonds; and WHEREAS, the Issuer has been provided all applicable disclosure information required by Section 218.385, Florida Statutes, a copy of which is attached to the Purchase Contract; and WHEREAS, this Resolution shall constitute a Supplemental Resolution under the terms of the Resolution and all capitalized undefined terms shall have the meaning set forth in the Resolution; NOW,THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF OCOEE, FLORIDA: SECTION 1. The negotiated sale of the Series 1997 Bonds to the Underwriter is hereby approved. The Mayor and the Clerk are hereby authorized to execute the Purchase Contract in substantially the form attached as Exhibit A, with such additional changes, insertions and omissions therein as may be approved by the said officers. of the Issuer executing the same, such execution to be conclusive evidence of such approval. SECTION 2. The Series 1997 Bonds shall be issued in the aggregate principal amount of $ , shall be dated January 1, 1997, shall be in the denomination of $5,000 or any integral multiple thereof and shall bear interest on the dates and at the rates and shall mature on the dates, in the years and amounts as shall be set forth in the Purchase Contract. The Series 1997 Bonds shall be subject to redemption prior to maturity at the time and in the manner set forth in the Purchase Contract. The remaining authorized but unissued principal amount of Series 1997 Bonds is hereby cancelled. SECTION 3. The Series 1997 Bonds shall be issued under and secured by the Resolution on parity with the Issuer's Series 1993 Bonds and shall be executed by manual or facsimile signature of the Mayor and the City Clerk of the Issuer in substantially the form set forth in the Resolution, with such additional changes and insertions therein as shall be approved by the officers of the Issuer executing the same, and such execution and delivery shall be conclusive evidence of the approval thereof by such officers. SECTION 4. The distribution by the Underwriter of the Preliminary Official Statement is hereby ratified. The Preliminary Official Statement is deemed final as of its date for purposes of Rule 15c2-12 (the "Rule) of the Securities and Exchange Commission, except for "permitted omissions," as defined in such Rule. SECTION 5. The distribution by the Underwriter of a final Official Statement of the Issuer relating to the Series 1997 Bonds is hereby approved in substantially the form of the Preliminary Official Statement, together with such changes thereto as may be authorized by the Mayor. The Official Statement will he executed by the Mayor, such execution to be conclusive evidence of approval of the Official Statement in its final form. SECTION 6. First Union National Bank of Florida, Jacksonville, Florida, is hereby appointed as Registrar and Paying Agent for the Series 1997 Bonds. 3 SECTION 7. In addition to the provisions set forth in Section 2.02 of the Resolution, the Issuer agrees that at the written request and expense of a Holder of$1,000,000 or more of Series 1997 Bonds, the interest due on a Series 1997 Bond may be paid by wire transfer or other medium acceptable to the Issuer and the Holder. SECTION 8. The Mayor, the City Manager, the City Clerk, the Finance Director, and the City Attorney of the Issuer or any other appropriate officers of the Issuer are hereby authorized and directed to execute any and all certifications or other instruments or documents required by the Resolution, the Purchase Contract, this Resolution or any other document referred to above as a prerequisite or precondition to the issuance of the Series 1997 Bonds and any such representation made therein by officers or representatives of the Issuer shall be deemed to be made on behalf of the Issuer. All action taken to date by the officers of the Issuer in furtherance of the issuance of the Series 1997 Bonds is hereby approved, confirmed and ratified. SECTION 9. All prior resolutions or other actions of the Issuer inconsistent with the provisions of this Resolution are hereby modified, supplemented and amended to conform with the provisions herein contained and except as otherwise modified, supplemented and amended hereby shall remain in full force and effect. 4 SECTION 10. This Resolution shall take effect immediately upon its passing. PASSED AND ADOPTED by the City Commission of the City of Ocoee, Florida, on this 17th day of December, 1996. A'F1'EST: APPROVED: CITY OF OCOEE, FLORIDA City Clerk Mayor FOR USE AND RELIANCE ONLY APPROVED BY THE OCOEE CITY BY THE CITY OF OCOEE, COMMISSION AT A MEETING APPROVED AS TO FORM AND HELD ON DECEMBER 17, 1996 LEGALITY, this UNDER AGENDA ITEM NO. day of December, 1996 FOLEY & LARDNER By: City Attorney J:\BONDS\4128\A W RES01 1 1 2/1 0/9 6I GED I R 5 EXHIBIT A PURCHASE CONTRACT CITY OF OCOEE, FLORIDA Water and Sewer System Improvement Revenue Bonds, Series 1997 BOND PURCHASE CONTRACT December , 1996 Mayor and Members of the City Commission City of Ocoee, Florida Dear Mayor and Commission Members: William R. Hough & Co. (the "Underwriter") offers to enter into the following agreement with the City of Ocoee, Florida (the "City") which, upon your acceptance of this offer, will be binding upon the City and upon the Underwriter. This offer is made subject to your acceptance on or before 11:59 p.m., E.S.T., on the date hereof and subject to withdrawal by the Underwriter upon notice to the City at any time prior to the acceptance hereof by you and subject to cancellation by the Underwriter pursuant to Section 8(e) hereof. All capitalized terms not otherwise defined herein shall have the meanings set forth in the Official Statement(as hereinafter defined). 1. Purchase and Sale. Upon the terms and conditions and upon the basis of the representations and agreements set forth herein, the Underwriter hereby agrees to purchase from the City for offering to the public and the City hereby agrees to sell and deliver to the Underwriter for such purpose, all (but not less than all) of the City's $ aggregate principal amount of Water and Sewer System Improvement Revenue Bonds, Series 1997 (the "Series 1997 Bonds"). The Series 1997 Bonds shall be dated as of January 1, 1997, shall be Q:1031771F.1 December 12,1996 issued in such principal amounts, bear such rates of interest and mature as set forth in Exhibit -- A attached hereto. Interest on the Series 1997 Bonds shall be payable on April 1, 1997, and on each October 1 and April 1 thereafter to maturity or earlier redemption. The aggregate purchase price of the Series 1997 Bonds shall be $ (which takes into account an original issue discount of$ and an Underwriter's discount of$ ), plus accrued interest on the Series 1997 Bonds from January 1, 1997 to the date of Closing (as hereinafter defined). The Series 1997 Bonds initially shall be offered to the public at such prices or yields (including discounts) as indicated on Exhibit A attached hereto. The Series 1997 Bonds shall be issued pursuant to and under the authority of, Chapter 166, Part II, _ _ Florida Statutes and other applicable provisions of law(collectively, the "Act"), the Charter of the City of Ocoee and under and pursuant to Resolution No. 93-02 adopted by the City Commission on February 2, 1993, as mended and supplemented (the "Resolution"). The Series 1997 Bonds will be payable solely from, and secured by, a pledge of and lien on the Pledged Funds (as defined in the Resolution). The Series 1997 Bonds are being issued to provide funds sufficient, together with other available funds of the City, to (1) finance a portion of the cost of acquiring and constructing certain additions, extensions and improvements to the System of the City, (2) acquire a surety bond for deposit into the account of the Reserve Fund established for the Series 1997 Bonds, and (3)pay certain costs and expenses relating to the issuance of the Series 1997 Bonds. 2. Good Faith Deposit. Delivered to you herewith, as a good faith deposit, is a corporate check of the Underwriter payable to the order of the City in the amount of$ as security for the performance by the Underwriter of its obligation to accept and pay for the Series 1997 Bonds at Closing (as defined herein) in accordance with the provisions hereof. In the event that you accept this offer, said check shall be held uncashed by the City as a good faith deposit. At the Closing, the check will be returned to the Underwriter. In the event you do not accept this offer, the check shall be immediately returned to the Underwriter. If the Underwriter fails (other than for a reason permitted hereunder) to accept and pay for the Series 1997 Bonds at the Closing as provided herein, the check may be cashed by you and the proceeds retained by the City as and for full liquidated damages for such failure and for any and all defaults hereunder on the part of the - Underwriter, and the retention of such amounts shall constitute a full release and discharge of all claims and damages for such failure and for any and all such defaults hereunder on the part of the Underwriter. In the event that the City fails to deliver the Series 1997 Bonds at the Closing, or if the City is unable at or prior to the date of Closing to satisfy or cause to be satisfied the conditions to the obligations of the Underwriter contained in this Bond Purchase Contract, or if the obligations of the Underwriter contained herein shall be canceled or terminated for 2 Q:\03177\F.1 December 12,1996 • any reason permitted by this Bond Purchase Contract, the City shall be obligated to immediately return the check to the Underwriter. 3. Offering. It shall be a condition of your obligation to sell and deliver the Series 1997 Bonds to the Underwriter, and the obligation of the Underwriter to purchase and accept delivery of the Series 1997 Bonds, that the entire aggregate principal amount of the Series 1997 Bonds shall be sold and delivered by you and accepted and paid for by the Underwriter at the Closing. The Underwriter agrees to make a public offering of all of the Series 1997 Bonds at the initial offering prices (or_yields) set forth in Exhibit.A attached hereto; provided, however, the Underwriter reserves the right to make concessions to dealers and to change such initial offering prices as the Underwriter shall deem necessary in connection with the marketing of the Series 1997 Bonds. • 4. Preliminary Official Statement and Official Statement. The City hereby confirms that it has heretofore made available to the Underwriter a Preliminary Official Statement of the City relating to the Series 1997 Bonds, dated November_, 1996 (which, together with the cover page and appendices contained therein, is herein called the "Preliminary Official Statement"), and authorizes and ratifies the use and distribution thereof to prospective purchasers and investors. Within seven business days of the acceptance hereof by the City (or such shorter period of time to allow the Underwriter to comply with any rules of the Municipal Securities Rulemaking Board), the City shall cause to be delivered the final Official Statement, dated the date hereof(which, together with the cover page and appendices contained therein, is.herein called the "Official Statement"), executed on behalf of the City by its Mayor in such reasonable numbers of conformed copies as the Underwriter shall request, which shall be sufficient in number to comply with paragraph (b)(3) of Rule 15c2-12 of the Securities and Exchange Commission (17 CFR §240.15c2-12) under the Securities Exchange Act of 1934 and with Rule G-32 and all other applicable rules of the Municipal Securities Rulemaking Board. The City, by its acceptance hereof, ratifies and approves the Preliminary Official Statement and the Underwriter'use thereof, and ratifies and approves and authorizes the Underwriter to use the Official Statement and all documents described therein in connection with the public offering and the sale of the Series 1997 Bonds. In accordance with Section 218.385, Florida Statutes, the Underwriter hereby discloses the information required by such Section, including a truth-in-bonding statement, as provided in Exhibit B attached hereto. 3 Q:\031771F.1 December 12,1996 5. Use of Documents. You hereby authorize the use by the Underwriter of(a) the Resolution, (b)the Preliminary Official Statement, (c)the Official Statement(including any supplements or amendments ttiereto), (d) the Consulting Engineer's Report, (e) Ordinance No. 92-19 of the City, dated August 18, 1992,regarding the establishment of rates for the System, and(f) any other documents related to the transactions contemplated in the Official Statement in connection with the public offering, sale and distribution of the Series 1997 Bonds. 6. Representations and Agreements. The City hereby represents and agrees as. follows: (a) As of the date of fie Official Statement and at the time of Closing, the statements and information contained in the Official Statement will be true, correct and complete in all material respects and the Official Statement will not omit any statement or information which should be included therein for the purposes for which the Official Statement is to be used or which is necessary to make the statements or information contained therein, in light of the circumstances under which they were made, not misleading; provided, however, that no representation is made regarding the municipal bond insurance policy or any related information. (b) Between the date of this Bond Purchase Contract and the time of Closing, the City will not execute any bonds, notes or obligations for borrowed money(other than the Series 1997 Bonds or obligations which pledge neither the full faith and credit of the City nor any portion of the Pledged Funds), without giving prior written notice thereof to the Underwriter. (c) The.City is, and will be at the date of Closing, duly organized and • validly existing as a municipal corporation of the State of Florida, with the powers and authority set forth in the Act. (d) The City has, and will have at the date of Closing full legal right, power and authority to: (i)enter into this Bond Purchase Contract,(ii) adopt the Resolution, (iii) sell, issue and deliver the Series 1997 Bonds to the Underwriter as provided herein, (iv) acquire and construct the Project, and (v) carry out and consummate the transactions contemplated by this Bond Purchase Contract, the Resolution and the Official Statement; and the City has complied, and at the Closing will be in , compliance, in all respects, with the terms of the Act and with the applicable obligations on its part in connection with the issuance of the Series 1997 Bonds contained in the Resolution, the Series 1997 Bonds and this Bond Purchase Contract. 4 Q:1o317TF.1 December 12,1996 (e) By all necessary official action, the City has duly adopted the Resolution, has duly authorized and approved the Official Statement, has duly authorized the acquisition and'construction of the Project, has duly authorized and approved the execution and delivery of, and the performance by the City of;this Bond Purchase Contract and all other obligations on its part in connection with the issuance of the Series .1997 Bonds.and the consummation by it of all other transactions contemplated by this Bond Purchase Contract in connection with the issuance of the Series 1997 Bonds; upon delivery of the Series 1997 Bonds, the Resolution will constitute a legal, valid and binding special obligation of the City, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity. (f) When delivered to and paid for by the Underwriter at the Closing in accordance with the provisions of this Bond Purchase Contract, the Series 1997 Bonds will have been duly authorized, executed, issued and delivered and will constitute valid and binding special obligations of the City in conformity with the Act and the Resolution, and shall be entitled to the benefits of the Resolution, including a prior pledge of and lien upon the Pledged Funds, all in accordance with the provisions of the Resolution, subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors'rights generally and subject, as to enforceability, to general principles of equity. (g) The adoption of the Resolution and the authorization, execution and delivery of this Bond Purchase Contract and the Series 1997 Bonds, and compliance with the provisions hereof and thereof, will not conflict with, or constitute a breach of or default under any law, administrative regulation, consent decree, ordinance, resolution or any agreement or other instrument to which the City was or is subject, as the case may be, nor will such adoption, execution, delivery, authorization or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon the Project or any of the other property or :assets of the City, or under the terms of any law, administrative regulation, ordinance, resolution or instrument, except as expressly provided by the Resolution or the Series 1997 Bonds. (h) At the time of Closing, the City will be in compliance in all respects with the applicable covenants and agreements contained in the Resolution; and no event of default and no event which, with the lapse of time or giving of notice, or 5 Q:\03177\F.1 December 12,1996 both, would constitute an event of default under the Resolution will have occurred-or be continuing. (i) Except as provided in the Official Statement, and except for certain permits relating to the Project to be obtained subsequent to the date of this Bond Purchase Contract, all approvals, consents, authorizations and orders of any governmental authority or agency having jurisdiction in any matter which would constitute a condition precedent to the performance by the City of its obligations hereunder or under the Resolution have been obtained and are in full force and effect. (j) The City is lawfully empowered to pledge and grant a lien upon the. Pledged Funds. -" (k) Except as disclosed in the Official Statement, to the best knowledge of the City, as of the date hereof, there is no action, suit, proceeding, inquiry or • investigation, at law or in equity, before or by any court, government agency, public board or body, pending or threatened against the City, affecting or seeking to prohibit, restrain or enjoin the sale, issuance or delivery of the Series 1997 Bonds or the pledge of and lien on the Pledged Funds, or contesting or affecting the validity or enforceability in any respect relating to the Series 1997 Bonds, the Resolution or this Bond Purchase Contract, or contesting the tax-exempt status of interest on the Series 1997 Bonds, or contesting the completeness or accuracy of the Official Statement or any supplement or amendment thereto, or contesting the powers of the City, the Council or any authority for the issuance of the Series 1997 Bonds, the adoption or enactment of the Resolution or the execution and delivery by the City of this Bond Purchase Contract. (1) The City will furnish such information, execute such instruments and take such other action in cooperation with the Underwriter as the Underwriter may reasonably request in order to (i) qualify the Series 1997 Bonds for offer and sale under the "blue sky" or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriter may designate,-and (ii) determine the eligibility of the Series 1997 Bonds for investment under the laws of such states and other jurisdictions, and will use its best efforts to continue such qualifications in effect so long as required for the distribution of the Series 1997 Bonds; provided, however, that the City shall not be required to execute a general or special consent to service of process or qualify to do business in connection with any such qualification or determination in any jurisdiction or expend its own funds with respect to the foregoing. 6 Q:\03177\F.1 December 12,1996 (m) The City will not take or omit to take any action, which action or omission will in any way cause the proceeds from the sale of the Series 1997 Bonds to be applied in a manner cot<trary to that provided for in the Resolution and as described in the Official Statement. (n) Except as expressly disclosed in the Official Statement, the City neither is nor has been in default any time after December 31, 1975, as to payment of principal or interest with respect to an obligation issued or guaranteed by the City. (o) The City has not been notified of any listing or proposed listing by the Internal Revenue Service to the effect that it is a bond issuer whose arbitrage certifications may not be relied"upon. - (p) As of its date, the Preliminary Official Statement is hereby deemed "final" by the City for purposes of SEC Rule 15c2-12(b)(1), except for "permitted omissions" as defmed in such Rule. (q) If, after the date of this Bond Purchase Contract and until the earlier of (i) 90 days from the end of the "underwriting period" (as defmed in SEC Rule 15c2- 12) or (ii) the time when the Official Statement is available to any person from a nationally recognized repository, but in no case less than 25 days following the end of the underwriting period, any event shall occur which might or would cause the Official Statement, as then supplemented or amended, to contain any untrue statement of a material fact or to omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the City shall notify the Underwriter thereof, and, if in the reasonable opinion of the Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, the City will at its own expense forthwith prepare and furnish to the Underwriter a sufficient number of copies of an amendment of or supplement to the Official Statement (in form and substance satisfactory to counsel to the Underwriter) which will supplement or amend the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances existing at such time, not misleading. (r). The City shall comply in all respects with the continuing disclosure requirements of Rule 15c2-12 promulgated under the Securities Exchange Act of • 1934, as set forth in the Official Statement and the Resolution. • 7 Q:\03177\F.1 December 12,1996 7. Closing. At P.M., E.S.T.,on January_, 1997, or at such time on such earlier or later date as shall be agreed upon, you will deliver to the Underwriter, at the location and place to be agreed upon by you and the Underwriter, the Series 1997 Bonds in definitive form, duly executed, together with the other documents herein mentioned; and the Underwriter will accept such delivery and pay at such location as may be agreed upon by you and the Underwriter the purchase price of the Series 1997 Bonds as set forth in Section 1 hereof, plus accrued interest on the Series 1997 Bonds from January 1, 1997, by immediately available funds, payable to the order of the City. This delivery and payment is herein called the "Closing." The Series 1997 Bonds shall be made available to the Underwriter at least one business day before the Closing for purposes of inspecting and packaging. The Series.1997 Bonds shall be prepared and delivered as fully registered Bonds. 8. Closing Conditions. The Underwriter have entered into this Bond Purchase Contract in reliance upon the representations and warranties of the City herein contained and the performance by the City of its obligations hereunder, both as of the date hereof and as of the time of Closing. The obligations of the Underwriter under this Bond Purchase Contract are and shall be subject to the following conditions: (a) The representations and agreements of the City contained herein shall be true and correct and complied with as of the date hereof and as of the date of the Closing, as if made on the date of the Closing. (b) At the time of the Closing, the Resolution shall be in full force and effect in accordance with its respective terms and shall not have been amended, modified or supplemented except as amended, modified or supplemented by a resolution or ordinance incorporating the terms of the Series 1997 Bonds and the terms and conditions contained in the municipal bond insurance commitment of the Insurer (as defined herein), and the Official Statement shall not have been supplemented or amended, except in any such case as may have been agreed to by the Underwriter. (c) -At the time- of Closing, a resolution or ordinance of the City incorporating the terms of the Series 1997 Bonds (or setting forth the parameters under which the Series 1997 Bonds may be sold to the Underwriter) and the terms and conditions contained in the municipal bond insurance commitment of the Insurer shall have been duly adopted by the City Commission. (d) At the time of the Closing, all official action of the City relating to this Bond Purchase Contract and the Series 1997 Bonds shall be in full force and effect 8 Q:\03177W.1 December 12,1996 - - in accordance with their respective terms and shall not have been amended, modified or supplemented in any material respect; except in each case as may have been agreed to by the Underwriter. (e) The Underwriter shall have the right to cancel the agreement contained herein to purchase, to accept delivery of and to pay for the Series 1997 Bonds by notifying you in writing of their intention to do so if: (i) between the date hereof and the Closing, legislation shall have been enacted by the Congress of the United States, or recommended to the Congress for passage by the President of the United States, or favorably reported for passage - to either House of Congress by,any Committee of such House, or passed by either House of Congress, or a decision shall have been rendered by a court of the United States or the United States Tax Court; or a ruling shall have been made or a regulation shall have been proposed or made by the Treasury Department of the United States or the Internal Revenue Service, with respect to the federal taxation of interest received on obligations of the general character of the Series 1997 Bonds, which, in the opinion of counsel for the Underwriter has, or will have, the effect of making such interest subject to inclusion in gross income for purposes of federal income taxation, except to the extent such interest shall be includable in gross income on the date hereof, or (ii) between the date hereof and the Closing, legislation shall be enacted or any action shall be taken by the Securities and Exchange Commission which, in the opinion of counsel for the Underwriter, has the effect of requiring the contemplated issuance or distribution of the Series 1997 Bonds to be registered under the Securities Act of 1933, as amended, or of requiring any of the Resolution to be qualified under the Trust Indenture Act.of 1939, as amended, or (iii) an event described in paragraph (q) of Section 6 hereof shall have occurred which requires an amendment or supplement to the Official Statement and which, in the reasonable opinion of the Underwriter and the financial advisor to the City, materially adversely affects the marketability of the Series 1997 Bonds or the market price thereof, or (iv) in the reasonable opinion of the Underwriter and the financial advisor to the City, payment for and delivery of the Series 1997 Bonds is rendered impracticable or inadvisable because (A) trading in securities generally shall have been suspended on the New York Stock Exchange, Inc., or (B) a general banking 9 Q:\03177\F.1 December 12, 1996 - moratorium shall have been established by Federal, New York or Florida authorities; or (C) the engagement of the United States in a war or other hostilities or the threat of war or other hostilities, or (v) an order, decree or injunction of any court of competent jurisdiction, or any order, ruling, regulation or administrative proceeding by any governmental body or board having jurisdiction of the subject matter, shall have been issued or commenced, or any legislation enacted, with the purpose or effect of prohibiting the issuance, offering or sale of the Series 1997 Bonds as contemplated hereby or by the Official Statement or prohibiting the adoption or enactment of the Resolution or the performance thereof, or (vi) between the date hereof and the Closing, the City has, without the prior written consent of the Underwriter, offered or issued any bonds, notes or. other obligations for borrowed money, or incurred any material liabilities, direct or contingent, other than as described in the Official Statement, in either case payable from the full faith and credit of the City or any portion of the Pledged Funds, or (vii) the President of the United States, the Office of Management and Budget, the Department of Treasury, the Internal Revenue Service or any other governmental body, department, agency or commission of the United States or the State of Florida having jurisdiction of the subject matter shall take or propose to take any action or implement or propose regulations, rules or legislation which, in the reasonable judgment of the Underwriter, materially adversely affects the market price of the Series 1997 Bonds or causes any material information in the Official Statement, in light of the circumstances under which it appears, to be misleading in any material respect, or (viii) any executive order shall be announced, or any legislation, ordinance,rule or regulation shall be proposed by or introduced in, or be enacted by any governmental body, department, agency or commission of the United States or the State of Florida or the State of New York, having jurisdiction over the Subject matter, or a decision by any court of competent jurisdiction within the United States or within the State of Florida or the State of New York shall be rendered which, in the reasonable judgment of the Underwriter,materially adversely affects the market price of the Series 1997 Bonds or causes any information in the Official Statement to be misleading in any material respect, or 1 O Q:\03177\F.1 December 12,1996 (ix) prior to Closing, either (A) Standard & Poor's Ratings Group, Fitch Investors Service, L.P. or Moody's Investors Service shall inform the City or the Underwriter that the Series 1997 Bonds will not be rated at least " ,"" •" and " ," respectively or (B) (the "Insurer") shall inform the Underwriter.or the City that it shall not deliver its municipal bond insurance policy (the "Policy") at the time of Closing, or (x) the rating of any class of security of the City shall have been downgraded or withdrawn by a national credit rating service. (f) At or prior to the date of the Closing, the Underwriter shall receive the following documents: (i) The Resolution certified by the City Clerk under seal as having been duly adopted or enacted by the City and as being in effect, with only such supplements, modifications or amendments as may have been agreed to by the Underwriter. (ii) Fully executed counterparts of the Official Statement and copies of conformed Official Statements sufficient to satisfy the requirements of Section 4 hereof. (iii) A final approving opinion of Bryant, Miller& Olive, P.A., Bond Counsel to the City, addressed to the City, dated the date of the Closing, in substantially the form included in the Official Statement as Appendix E. (iv) A letter of Bryant, Miller & Olive, P.A., addressed to the Underwriter, and dated the date of Closing, to the effect that their final approving opinion referred to in Section 8(f)(iii) hereof may be relied upon by the Underwriter and the Insurer to the same extent as if such opinion were addressed to the Underwriter and the Insurer. (v) A supplemental opinion of Bryant, Miller & Olive, P.A., addressed to the City and the Underwriter, and dated the date of Closing, to the effect that (A) the information set forth in the Official Statement under the headings, "INTRODUCTION," "SECURITY&SOURCES OF PAYMENT FOR THE SERIES 1997 BONDS," "THE SERIES 1997 BONDS," "TAX EXEMPTION," "CONTINUING DISCLOSURE," and in APPENDICES D, E and F (other than the fmancial, statistical and/or demographic information and information concerning the 11 Q:\03177W.1 December 12,1996 City, the Insurer and the Policy included therein as to which no opinion need be expressed), insofar as such information purports to be descriptions or summaries of the Act, the Resolution, the-Series 1997 Bonds, or the laws referred to therein, constitute accurate and fair statements or summaries of the matters set forth or the documents referred to therein, and the information under the heading "TAX EXEMPTION" and in APPENDIX E is correct; and (B) the Series 1997 Bonds are exempt from registration under the Securities Act of 1933, as amended, and the Resolution is exempt from qualification as an indenture under the Trust Indenture Act of 1939, as amended. (vi) An opinion of Foley.&Lardner, Attorneys to the City, addressed to the City, the Insurer and the Underwriter, and dated the date of the Closing, to the effect that, (A)the City is a municipal corporation, duly created and validly existing and has full legal right, power and authority to adopt the Resolution and perform its obligations thereunder, and to authorize, execute and deliver and to perform its obligations under this Bond Purchase Contract, (B) the City has duly adopted the Resolution and has duly authorized, executed and delivered this Bond Purchase Contract, and assuming the due authorization, execution and delivery of this Bond Purchase Contract by the Underwriter, such instruments constitute legal, binding and valid obligations of the City, enforceable in accordance with their respective terms; provided, however, the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity, (C) the information in the Official Statement as to legal matters relating to the City, the Pledged Funds, the Act, the Series 1997 Bonds and the Resolution is correct in all material respects and does not omit any statement, which in his opinion, should be included or referred to therein, and in addition, with respect to all of the information in the Official Statement and based upon his review of the Official Statement as City Attorney and without having undertaken to determine independently the accuracy or completeness of the contents of the Official Statement, he has no reason to believe that the Official Statement (except for the financial and statistical data contained therein, information contained under the heading "TAX EXEMPTION" and the information relating to the Insurer and the Policy, as to which no view need be expressed) contains an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading, (D) the use of the Preliminary Official Statement by the Underwriter for the purpose of offering the Series 1997 Bonds for sale has been duly authorized and ratified by the City, (E) the Official Statement has been duly authorized, executed and delivered by the City, 12 Q:103177W.1 December 12,1996 and the City has consented to the use thereof by the Underwriter, (F) to the best of his knowledge, the adoption and enactment of the Resolution, and the authorization, execution and delivery of this Bond Purchase Contract and the Series 1997 Bonds, and compliance with the provisions hereof and thereof, will not conflict with, or constitute a breach of or default under, any law, administrative regulation, consent decree, ordinance, resolution or any agreement or other instrument to which the City was or is subject, as the case may be, nor will such adoption, enactment, execution, delivery, authorization or compliance result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the City, or under the terms of any law, administrative regulation, ordinance, resolution or instrument, except as expressly provided by the Resolution, (G) to the best of lit knowledge; all approvals, consents, authorizations and orders of any governmental authority or agency having jurisdiction in any matter which would constitute a condition precedent to the performance by the City, of its obligations hereunder and under the Resolution have been obtained and are in full force and effect, (H)the City is lawfully empowered to pledge, and grant a prior lien on the Pledged Funds for payment of the principal of, redemption premium, if any, and interest on the Series 1997 Bonds as the same becomes due and payable, and (I) except as disclosed in the Official Statement, to the best of his knowledge, as of the date of such opinion, there is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, government agency, public board or body, pending or threatened against the City, affecting or seeking to prohibit, restrain or enjoin the sale, issuance or delivery of the Series 1997 Bonds, or the pledge of and lien on the Pledged Funds or contesting or affecting as to the City the validity or enforceability in any respect of the Series 1997 Bonds, the Resolution, or this Bond Purchase Contract, or contesting the tax-exempt status of interest on the Series 1997 Bonds, or contesting the completeness or accuracy of the Official Statement or any supplement or amendment thereto, or contesting the powers of the City, the Commission, or any authority for the issuance of the Series 1997 Bonds, the adoption of the Resolution or the execution and delivery by the City of this Bond Purchase Contract. (vii) A certificate, which shall be true and correct at the time of Closing, signed by the Mayor and the City Manager of the City or such other officials satisfactory to the Underwriter, and in form and substance satisfactory to the Underwriter, to the effect that, to the best of their knowledge and belief (A) the representations and covenants of the City contained herein are true and correct in all material respects and are complied with as of the time of Closing, and (B) the Official Statement did not as of its date, and does not as of the date of Closing, contain any 13 • December mber 12,1996 untrue statement of a material fact or omit to state a material fact which should be included therein for the purposes for which the Official Statement is to be used, or which is necessary in order to-make the statements contained therein, in light of the circumstances in which they were made, not misleading (provided, that no opinion need be expressed regarding the information contained therein relating to the Insurer or the Policy). (viii) An opinion of Nabors, Giblin&Nickerson, P.A., Counsel to the Underwriter, addressed to the Underwriter, and dated the date of Closing, substantially to the effect that, with respect to the information in the Official Statement and based upon said firm's participation in the.preparation of the Official Statement as counsel to the Underwriter and without having undertaken to determine independently the accuracy or completeness of the contents of the Official Statement, said firm has no reason to believe that the Official Statement(except for the financial and statistical data contained therein, the information therein relating to the Insurer or the Policy, and Appendices A, B, C, E, F and G thereto, as to which no view need be expressed) contains an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. (ix) ' A certificate of an authorized"representative of First Union National Bank of Florida, Jacksonville, Florida (the "Bank"), as Registrar, Paying Agent and Escrow Agent to the effect that (A) the Bank is a national bank duly organized, validly existing and in good standing under the laws of the United States of America and is duly authorized to exercise trust powers in the State of Florida, (B) the Bank has all requisite authority, power, licenses, permits and franchises, and has full corporate power and legal authority to execute and perform its functions under the Resolution, (C)the performance by the Bank of its functions under the Resolution will not result in any violation of the Articles of Association or Bylaws of the Bank, any court order to which the Bank is subject or any agreement, indenture or other obligation or instrument to which the Bank is a party or by which the Bank is bound, and no approval or other action by any governmental authority or agency having • supervisory authority over the Bank is required to be obtained by the Bank in order to perform its functions under the Resolution and (D) to the best of such authorized Representative's knowledge, there is no action, suit, proceeding or investigation at law or in equity before any court, public board or body pending or, to his or her knowledge, threatened against or affecting the Bank wherein an unfavorable decision, ruling or fmding on an issue raised by any party thereto is likely to materially and 14 Q:\os 17,7\F.1 December 12,1996 adversely affect the ability- of the Bank to perform its obligations under the Resolution. _.r (x) A copy of the Combined Water and Wastewater Fund Financial Statements for the Fiscal year ended September 30, 1996, together with the audit opinion of McDermit, Davis, Lauteria& Company, P.A., independent accountants. (xi) The Policy and Surety Bonds issued by the Insurer. (xii) A letter from McDermit, Davis, Lauteria& Company, P.A. to the effect that they are independent certified public accountants engaged by the City and they consent to the use of Their name and report in the Official Statement; (xiii) An opinion of general counsel to the Insurer or a certificate of an officer of the Insurer dated the date of the Closing and addressed to the Underwriter, concerning the Insurer, the Policy, and the information relating to the Insurer and the Policy contained in the Official Statement, in form and substance satisfactory to Bond Counsel, the Underwriter and counsel to the Underwriter. (xiv) A certificate of the City Manager deeming the Preliminary Official Statement "final" as of its date for purposes of Rule 15c2-12; (xv) A letter of Standard&Poor's Ratings Group to the effect that the Series 1997 Bonds have been assigned a rating no less favorable than " ," a letter of Moody's Investors Service to the effect that the Series 1997 Bonds have been assigned a rating no less favorable than " ," and a letter of Fitch Investors Service, L.P. to the effect that the Series 1997 Bonds have been assigned a rating no less favorable than " ," all of which such ratings shall be in effect as of the date of Closing; (xvi) A certificate of Professional Engineering Consultants, Inc., Orlando, Florida (the "Engineering Consultants") to the effect that: (A) the - Engineering Consultants are a firm of professional consultants, (B) the Engineering Consultants consent to the use of their name in the Official Statement and the inclusion therein of the Engineering Report as Appendix B thereto, (C) the information in the Official Statement, including Appendix B thereto, relating to the Engineering Consultants, the Engineering Report and the System is correct in all material respects and does not omit any material statement, which in their opinion, should be included or referred to therein. 15 Q:\03177'F.1 December 12,1996 (xvii) A certificate of First Union Capital Markets Corp. substantially to the effect that, (A) with respect to the information in the Official Statement and based upon their review of the-Official Statement as Financial Advisor to the City and without having undertaken to determine independently the accuracy or completeness of the contents of the Official Statement, said firm has no reason to believe that the Official Statement (except for the information therein relating to the Insurer or the Policy, and the Appendices thereto, as to which no view need be expressed) contains an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading, and [(B) the fmancial parameters set forth in the Resolution relating to the award of the Series 1997 Bonds and the execution of this Bond Purchase Contract have been satisfied in all respects.] (xviii) The statement of an independent certified public accountant required pursuant to Section 5.02 of the Resolution. (xix) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the date of the Closing, of the City's representations and warranties contained herein and of the statements and information contained in the Official Statement and the due performance or satisfaction by the City on or prior to the date of Closing of all the agreements then to be performed and conditions then to be satisfied by it. If the City shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Series 1997 Bonds contained in this Bond Purchase Contract and the Underwriter do not waive such inability in writing, or if the obligations of the Underwriter to purchase, to accept delivery of and to pay for the Series 1997 Bonds shall be terminated for any reason permitted by this Bond Purchase Contract, this Bond Purchase Contract shall terminate, the good faith deposit described in Section 2 hereof shall be returned to the Underwriter and neither the Underwriter nor the City shall be-under any further obligation hereunder, except that the respective obligations of the City and the Underwriter set forth in Section 9 hereof shall continue in full force and effect. 9. Expenses. The Underwriter shall be under no obligation to pay, and the City shall pay, any expense incident to the performance of the City's obligations hereunder including, but not limited to: (a) the cost of preparation, printing and delivery of the Resolution; (b)the cost of preparation and printing of the Series 1997 Bonds; (c) the fees and 16 Q:103177\F.I December 12,1996 disbursements of Bond Counsel; (d)the fees and disbursements of the City's certified public accountants; (e)the fees and disbursements of any experts, consultants or advisors retained by the City; (f) fees for bond ratings;('g) the fees and expenses of the Registrar, the Paying Agent, the Engineering Consultants and of their respective counsel; and (h) the costs of preparing, printing and delivering the Preliminary Official Statement and the Official Statement and any supplements or amendments thereto. The Underwriter shall pay: (a) the cost of preparing, printing and delivery of this Bond Purchase Contract; (b)the cost of all "blue sky" and legal investment memoranda and related filing fees; (c)the fees and expenses of counsel to the Underwriter; (d) all advertising expenses; and(e) all other expenses incurred by them or any of them in connection with the public offering of the Series 1997 B1bnds. In the event that either party shall have paid obligations of the other as set forth in this Section 9, adjustment shall be made at the time of the Closing. 10. Notices. Any notice or other communication to be given to you under this Bond Purchase Contract may be given by mailing the same to City of Ocoee, Florida, 150 North Lakeshore Drive, Ocoee, Florida, to the attention of the City Manager, and any such notice or other communication to be given to the Underwriter may be mailed to William R. Hough & Co., 100 Rialto Place, Suite 731, Melbourne, Florida 32901, to the attention of Mr. John White. 11. Parties in Interest. This Bond Purchase Contract is made solely for the benefit of the City and the Underwriter and no other party or person shall acquire or have any right hereunder or by virtue hereof. All your representations and agreements in this Bond Purchase Contract shall remain operative and in full force and effect and shall survive the delivery of the Series 1997 Bonds. 12. Waiver. Notwithstanding any provision herein to the contrary, the performance of any and all obligations of the City hereunder and the performance of any and all conditions contained herein for the benefit of the Underwriter may be waived by the Underwriter, in their sole discretion, and the approval of the Underwriter when required hereunder or the determination of their satisfaction as to any document referred to herein shall be in writing, signed by an appropriate officer or officers of the Underwriter and delivered to you. 13. No Liability. Neither the City Commissioner, nor any of the members thereof, nor any officer, agent or employee thereof, shall be charged personally by the Underwriter with any liability, or held liable to the Underwriter under any term or provision of this Bond 17 Q:\03177W.1 December 12,1996 Purchase Contract because of its execution or attempted execution, or because of any breach or attempted or alleged breach thereof. 14. Governing Law. This Bond Purchase Contract, and the terms and conditions herein, shall constitute the full and complete agreement between the City and the Underwriter with respect to the purchase and sale of the Series 1997 Bonds. This Bond Purchase Contract shall be governed by and construed in accordance with the laws of the State of Florida. Very truly yours, WILLIAM R. HOUGH & CO. Title: Vice President CITY By: . S. Scott Vandergrift, Mayor Executed on: , 19 Attest: Jean Grafton, City Clerk (SEAL) FOR USE AND RELIANCE ONLY APPROVED BY THE OCOEE CITY THE CITY OF OCOEE, FLORIDA COMMISSION AT A MEETING HELD APPROVED AS TO FORM AND ON , 19 LEGALITY this day of UNDER AGENDA ITEM NO. , 19 Foley& Lardner By: • City Attorney 1 g Q:\031771F.1 December 12,1996 EXHIBIT A TERMS OF SERIES 1997 BONDS MATURITY SCHEDULE Maturity Price or (_ ) Amount Interest Rate Yield [To Follow] • Optional Redemption The Series 1997 Bonds maturing on or prior to October 1, are not subject to redemption prior to their respective maturities. The Series 1997 Bonds maturing on or after October 1, are subject to redemption prior to maturity at the option of the City, in whole at any time or in part on any interest payment date in such manner as shall be - determined by the City and by lot within a maturity if less than a full maturity from any legally available moneys at a redemption price (expressed as a percentage of the principal amount) as set forth in the following table, plus accrued interest to the redemption date. A-1 December mber 12,1996 • Period During Which Redeemed Redemption (Both dates inclusive) Price October 1, through September 30, October 1, through September 30, October 1, and thereafter Mandatory Redemption The Series 1997 Bonds which mature on October 1, are subject to mandatory redemption in part prior to maturity by lot, at redemption prices equal to 100% of the principal amount thereof plus inter 'st accrued to the redemption date, beginning on October 1, , and on each October 1 thereafter, in the following principal amounts in the years specified: Principal Year Amount • $ * *Maturity The Series 1997 Bonds which mature on October 1, are subject to mandatory redemption in part prior to maturity by lot, at redemption prices equal to 100% of the principal amount thereof plus interest accrued to the redemption date, beginning on October 1, , and on each October 1 thereafter, in the following principal amounts in the years specified: Principal Year Amount * *Maturity A-2 Q:1031771F.1 December 12,1996 The Series 1997 Bonds which mature on October 1, are subject to mandatory redemption in part prior to maturity by lot, at redemption prices equal to 100% of the principal amount thereof plus interest accrued to the redemption date, beginning on October 1, , and on each October 1 thereafter, in the following principal amounts in the years specified: Principal Year Amount * *Maturity A-3 Q:\03177\F.1 December 12,1996 EXHIBIT B DISCLOSURE STATEMENT AND TRUTH-IN-BONDING STATEMENT March 1, 1996 Mayor and Members of the City Commission City of Ocoee, Florida Re: $ City of Ocoee, Florida Water and Sewer System • Improvement Revenue Bonds, Series 1997 Dear Mayor and Commission Members: In connection with the proposed issuance by the City of Ocoee, Florida (the "City") of$ in aggregate amount of its Water and Sewer System Improvement Revenue Bonds, Series 1997(the "Series 1997 Bonds"), William R. Hough & Co. (the "Underwriter") is underwriting a public offering of the Series 1997 Bonds. The purpose of the following paragraphs of this letter is to furnish, pursuant to the provisions of Section 218.385(6), Florida Statutes, certain information with respect to the arrangements contemplated for the purchase and sale of the Series 1997 Bonds, as follows: (a) The nature and estimated amount of expenses to be incurred by the Underwriter in connection with the purchase and re-offering of the Series 1997 Bonds are set forth in Schedule I attached hereto. (b) There are no "finders," as defined in Section 218.386, Florida Statutes, connected with the sale and purchase of the Series 1997 Bonds. (c) The underwriting spread, the difference between the price at which the Series 1997 Bonds will be initially offered to the public by the Underwriter and the price to be paid to the City for the Series 1997 Bonds, exclusive of accrued interest, will be $ per $1,000 of Series 1997 Bonds issued. (d) As part of the estimated underwriting spread set forth in paragraph (c) above, • the Underwriter will charge a management fee of$ per $1,000 of Series 1997 Bonds issued. Q:\03177\F.1 B-1 December 12,1996 (e) No other fee, bonus or other compensation is estimated to be paid by the Underwriter in connection with the issuance of the Series 1997 Bonds to any person not regularly employed or retained by the Underwriter (including any "finder" as defined in Section 218.386, Florida Statutes), except as specifically enumerated as expenses to be incurred by the Underwriter, as set forth in paragraph (a) above. (f) The name and address of the Underwriter are: William R. Hough& Co. 100 Rialto Place, Suite 731 Melbourne, Florida 32901 The purpose of the following paragraphs is to furnish, pursuant to the provisions of Sections 218.385(2) and (3), Florida Statutes, as amended, the truth-in-bonding statement required thereby, as follows: (a) The City is proposing to issue $ of the Series 1997 Bonds for the principal purposes of providing sufficient monies to (1) finance a portion of the cost of acquiring and constructing certain additions, extensions and improvements to the Water and Sewer Systems of the City, (2) acquire a surety bond for deposit into the account of the Reserve Fund established for the Series 1997 Bonds, and (3) pay certain costs and expenses relating to the issuance of the Series 1997 Bonds. This obligation is expected to be repaid over a period of approximately years. At the interest rates set forth on Exhibit A to the Bond Purchase Contract to which this is attached, total interest paid over the life of the obligation (including accrued interest) will be $ (b) The source of repayment or security of the Series 1997 Bonds is the Pledged Funds as defined in the Resolution. Authorizing this debt will result in an average of approximately $ of such Pledged Funds not being available to finance other services of the City each year for approximately years. The foregoing is provided for information purposes only and shall not affect or control the actual terms and conditions of the Series 1997 Bonds. Very truly yours, WILLIAM R. HOUGH & CO Title: Vice President Q:1031771F.1 B-2 December 12,1996 SCHEDULE I UNDERWRITER'S ESTIMATED EXPENSES (Per $1,000 of Series 1997 Bonds) Underwriter's Counsel $ Travel and out-of-pocket Federal Funds/Day Loari+^ Dalnet/Dalcomp, DTC/CUSIP CUSIP/MSRB Total $ Q:\03177W.1 December 12,1996 a.) ti rn PRELIMINARY OFFICIAL STATEMENT DATED DECEMBER 9,1996 E NEW ISSUE RATINGS:Moody's:"Aaa" CD 00 c Standard&Poor's:"AAA" o 2 Fitch:"AAA" $ o (AMBAC Insured) .c m (See"RATINGS"herein) a. In the opinion of Bond Counsel,assuming compliance by the City with certain covenants in the herein described Resolution,interest on the a >. Series 1997 Bonds is excluded from gross income for purposes of Federal income taxation and the Series 1997 Bonds are exempt from all present CD ccc intangible personal property taxes imposed pursuant to Chapter 199,Florida Statutes.See,however, "TAX EXEMPTION"herein for a description o n of certain Federal minimum and other special taxes that may affect the tax treatment of interest on the Series 1997 Bonds. a) i $10,500,000* R i=A CITY OF OCOEE, FLORIDA E Y . Water and Sewer System Improvement Revenue Bonds, s . Series 1997 = a, Dated:January 1,1997 Due:October 1 (as shown below) o -o o o The City of Ocoee,Florida,Water and Sewer System Improvement Revenue Bonds,Series 1997(the"Series 1997 Bonds")are being issued m c by the City of Ocoee,Florida(the"City")in fully registered form,without coupons,in denominations of$5,000 or integral multiples thereof.The co -o .� v principal and the premium,if any,on the Series 1997 Bonds will be payable upon surrender of the Series 1997 Bonds at the designated corporate y , g . office of First Union National Bank of Florida, Jacksonville, Florida, as Registrar and Paying Agent, or its successors. Interest on the Series fl .. .- 1997 Bonds is payable semi-annually beginning on April 1, 1997 and on each October 1 and April 1 thereafter by check or draft mailed by the m s) Paying Agent to the registered owners thereof at the addresses as shown on the registration books maintained by the Registrar at the close of c .2 ' business on the fifteenth day of the calendar month immediately preceding such interest payment date or,at the written request and expense of m H c a registered owner of$1,000,000 or more of Series 1997 Bonds,by wire transfer or other medium acceptable to the City and the Paying Agent. E . The Series 1997 Bonds are being issued pursuant to the Constitution and the laws of the State of Florida,particularly Chapter 166,Part II, Florida Statutes and other applicable provisions of law,the Charter of the City of Ocoee,Resolution No.93-02,adopted by the City Commission 0 0 .0 of the City on February 2, 1993,as amended and supplemented,in,particular as amended and supplemented by Resolution No.96-32, adopted m ._ by the City Commission of the City on December 3,1996 authorizing the Series 1997 Bonds(the"Resolution"). ti H rn .2 Certain of the Series 1997 Bonds are subject to optional and mandatory redemption prior to maturity as set forth in this y• d y Official Statement. ' o The Series 1997 Bonds are being issued,together with other legally available funds,to:(i)expand the capacity of and construct and acquire in m .0°'o other improvements to the City's water and sewer system (the "System"), (ii) acquire a surety bond in an amount equal to the Reserve ci cp C Requirement for the Series 1997 Bonds for deposit into the account in the Reserve Fund established for the benefit of the Series 1997 Bonds,and c (iii)pay costs of issuance of the Series 1997 Bonds,including the municipal bond insurance policy premium. •c in The Series 1997 Bonds and the interest thereon are payable solely from and secured by a prior lien on and pledge of:(i)the Net Revenues Esi (as defined herein)of the System, (ii)certain System development charges as described herein, and(iii)until applied in accordance with the c _ •�• provisions of the Resolution,certain moneys,including investments thereof,in certain of the funds and accounts established by the Resolution m d ' (collectively, the"Pledged Funds"). Such prior lien on and pledge of the Pledged Funds is on a parity with the lien and pledge granted to the cEo aa., c. holders of the City's Water and Sewer System Refunding and Improvement Revenue Bonds,Series 1993 and any Additional Bonds subsequently `o Me c issued pursuant to the Resolution. o N The Series 1997 Bonds and the interest thereon do not constitute a general indebtedness or a general obligation of the City N 'U y co ` within the meaning of any constitutional,statutory or charter provision or limitation,and the City has not pledged its full faith and n •— credit for the payment of the principal of,redemption premium,if any,and interest on the Series 1997 Bonds and/or the making of E 0 2 any reserve or other payments provided for in the Resolution.No Series 1997 Bondholder shall ever have the right to require or 0 % o compel the exercise of the ad valorem taxing power of the City or taxation in any form on any real or personal property of or in the $ c o City,or to use any other funds of the City other than the Pledged Funds,for the payment of the principal of,redemption premium, .E 'a if any,and interest on the Series 1997 Bonds or the making of any reserve or other payments in connection therewith. ▪ 5 Payment of the principal of and interest,when due,on the Series 1997 Bonds will be insured by a municipal bond insurance policy to be ci , �v 3 issued by AMBAC Indemnity Corporation simultaneously with the delivery of the Series 1997 Bonds. For a discussion of the terms and m a = provisions of such policy,including the limitations thereof,see"MUNICIPAL BOND INSURANCE"herein and Appendix G hereto. cTo y -c azt AMBAC i c„d - ai c MATURITIES,PRINCIPAL AMOUNTS,INTEREST RATES AND PRICES OR YIELDS c c• cc a3i $ _ *Serial Bonds ▪ E y Principal Interest - Price Principal Interest Price o i o Maturity Amount Rate or Yield Maturity Amount Rate or Yield c $ % % $ % % o U O O gip c ca E y •5 2 c _ $ - %Term Bonds Due -Yield % .c = y c • $ %Term Bonds Due Yield % CD o o $ - %Term Bonds Due -Yield % RR 0 (Accrued interest to be added) ,mac— H This cover page contains certain information for quick reference only.It is not a summary of the Series 1997 Bonds.Investors must read m c 5 the entire Official Statement to obtain information essential to the making of an informed investment decision regarding the Series 1997 Bonds. 4.;• d .c 3 The Series 1997 Bonds are offered when, as,and if issued and received by the Underwriter and subject to the receipt of an opinion as to the in iii c validity of the Series 1997 Bonds and certain other matters by Bryant, Miller and Olive, P.A., Tampa, Florida, Bond Counsel. Certain legal — c matters incident to the issuance and delivery of the Series 1997 Bonds will be passed upon for the City by its counsel,Foley&Lardner, Orlando, E a •c• Florida, and for the Underwriter by its counsel,Nabors, Giblin &Nickerson, P.A., Tampa, Florida. The City has retained First Union Capital e .i v Markets Corp., Orlando,Florida as its financial advisor with respect to the issuance of the Series 1997 Bonds.It is expected that the Series 1997 ZE' Bonds in definitive form will be available for delivery in New York,New York on or about January_1997. co E T William R. Hough & Co '� � . N 1 c Dated:December_,1996 c 1 00 m *Preliminary,subject to change. CITY OF OCOEE, FLORIDA 150 North Lakeshore Drive Ocoee, Florida 34761 (407) 656-2322 MAYOR S. Scott Vandergrift COMMISSIONERS Leon "Rusty" Johnson Jim Gleason Scott A. Glass Scott Anderson CITY MANAGER Ellis Shapiro CITY CLERK Jean Grafton FINANCE DIRECTOR Wanda Horton CITY ATTORNEYS Foley& Lardner Orlando, Florida INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS McDinnit, Davis, Lauteria & Company, P.A. Orlando, Florida CONSULTING ENGINEER PEC/Professional Engineering Consultants, Inc. Orlando, Florida BOND COUNSEL Bryant, Miller and Olive, P.A. Tampa, Florida FINANCIAL ADVISOR First Union Capital Markets Corp. Orlando, Florida No dealer, broker, salesman or other person has been authorized to give any information or to make any representations, other than as contained in the Official Statement, in connection with the offering of the Series 1997 Bonds described herein, and if given or made, such information or representations must not be relied upon as having been authorized by the City or the Underwriter. This Official Statement does not constitute an offer to sell nor the solicitation of an offer to buy the Series 1997 Bonds, nor shall there be any sale of the Series 1997 Bonds by any person in any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale. The information set forth herein has been furnished by the City and by other sources which are believed to be reliable, but such information is not guaranteed as to completeness and accuracy and is not to be construed as a representation or contract, by the Underwriter. The information and expressions of opinion stated herein are subject to change without notice, and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances create any implication that there has been no change in the information or opinions set forth herein after the date of this Official Statement. IN CONNECTION WITH THE OFFERING OF THE SERIES 1997 BONDS, THE UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH SERIES 1997 BONDS OFFERED HEREBY AT LEVELS ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. THIS PRELIMINARY OFFERING STATEMENT IS IN A FORM DEEMED FINAL BY THE CITY FOR THE PURPOSE OF RULE 15c2-12 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, EXCEPT FOR CERTAIN INFORMATION PERMITTED TO BE OMITTED UNDER RULE 15c2-12(b)(1). THE SERIES 1997 BONDS HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR HAS THE RESOLUTION BEEN QUALIFIED UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, IN RELIANCE UPON EXEMPTIONS CONTAINED IN SUCH ACTS. THE REGISTRATION OR QUALIFICATION OF THE SERIES 1997 BONDS IN ACCORDANCE WITH APPLICABLE PROVISIONS OF THE SECURITIES LAWS OF THE STATES, IF ANY, IN WHICH THE SERIES 1997 BONDS HAVE BEEN REGISTERED OR QUALIFIED AND THE EXEMPTION FROM REGISTRATION OR QUALIFICATION IN CERTAIN OTHER STATES CANNOT BE REGARDED AS A RECOMMENDATION THEREOF. NEITHER THESE STATES NOR ANY OF THEIR AGENCIES HAVE PASSED UPON THE MERITS OF THE SERIES 1997 BONDS OR THE ACCURACY OR COMPLETENESS OF THIS OFFICIAL STATEMENT. ANY REPRESENTATIONS TO THE CONTRARY MAY BE A CRIMINAL OFFENSE. TABLE OF CONTENTS Page Page SUMMARY STATEMENT iii SUMMARY OF CONSULTING ENGINEER'S CONCLUSIONS 34 - INTRODUCTION • 1 HISTORICAL AND PROJECTED SCHEDULE SECURITY AND SOURCES.OF PAYMENT OF NET REVENUES AND DEBT SERVICE FOR THE'SERIES 1997 BONDS " 2 COVERAGE 36 General - - 2 - • Development Charges 3 -LITIGATION 38 Rate Covenant 5 Reserve Fund 5 LEGAL MATTERS 38 Additional Bonds 6 - - Subordinated Indebtedness : -• 8 TAX EXEMPTION , - - - 38 Investments - 8 General - • 38 Other Covenants 8 Tax Treatment of Original Issue.Discount . . 40 MUNICIPAL BOND INSURANCE .9 UNDERWRITING ' , : 40 Payment Pursuant to Municipal Bond . . Insurance Policy 9 - CONTINUING DISCLOSURE 41 AMBAC Indemnity Corporation 10 - Available Information 11 RATINGS 41 Incorporation of Certain Documents by Reference - 12 - - FINANCIAL STATEMENTS - 42 THE SERIES 1997 BONDS - 12 FINANCIAL ADVISOR ' - 42 General ' - . 12 Optional Redemption- • - :14 DISCLOSURE REQUIRED BY FLORIDA BLUE Mandatory Redemption 15 SKY REGULATIONS _ 42 Notice of Redemption 16 ENFORCEABILITY OF REMEDIES 43 ESTIMATED SOURCES AND USES OF ' - FUNDS - 17 MISCELLANEOUS ' 43 SCHEDULED DEBT SERVICE FOR THE , CERTIFICATE AS TO'OFFICIAL ' - SERIES 1997 BONDS 18 STATEMENT ' 43 THE CITY 19 , . Appendices History and Organization 19 A— General Information Concerning the City of Ocoee THE SYSTEM, 19• . and Orange County -. Introduction - - 19 -Water and Sewer Territorial Agreements 21 B— Engineering Report of Professional Engineering Administration 22, Consultants;Inc. Employees 23 Water System • 23 C— Combined Water and Wastewater Fund Financial Sewer System • 26 Statements for the Fiscal Year Ended September 30, Water and Wastewater Rates • - 28 1996 _ Revenue and Maintenance Fees; Impact Fees; Other Charges and Deposits 31 D— Summary of Certain Provisions of the Resolution Collection Practices;Delinquencies - 31 Regulation - 32 E— Form of Bond Counsel's Legal Opinion THE PROJECT 33 F— Form of Continuing Disclosure Certificate Introduction 33 . , Capital Improvements to Water System . . : 33 G— Specimen Copy of Municipal Bond Insurance Policy Capital Improvements to Sewer System 34 ii - SUMMARY:STATEMENT• • This Summary Statement, being part of the Official Statement, is subject to the more complete information'.contained herein and should not be considered to be a complete statement of the facts material to making an investment decision. The offering of the City of Ocoee, Florida, Water and Sewer System Improvement Revenue Bonds, Series 1997 (the "Series 1997 Bonds"), to potential investors is made only by means of the entire Official Statement. No :person is authorized to detach this Summary Statement from the Official Statement or otherwise use it without the entire Official Statement. Capitalized terms used but not defined in this Summary Statement shall have the same meanings:as in the Resolution (as hereinafter defined), unless the context would clearly indicate otherwise. See "SUMMARY. OF CERTAIN PROVISIONS OF THE RESOLUTION", in Appendix D hereto. The City • . The City of Ocoee, Florida (the,"City"), was incorporated in-1925. It is bounded on the west by:Winter Garden, Florida, and on the south by Windermere,Florida, and has a land area of approximately 20.5 square miles, making it the second largest city in land area of the thirteen cities in Orange County. As..of April 1, 1996, the population of the City was estimated at 19,261, which ranks the City third in population of the cities in Orange County. See "GENERAL INFORMATION CONCERNING:THE CITY OF OCOEE-AND ORANGE COUNTY" in Appendix A hereto: -The Series:1997 Bonds The.Series 1997 Bonds are issuable only in fully registered form, without coupons, in denominations of$5,000 or any integral multiples thereof. Interest on the Series 1997 Bonds is,payable semi-annually.beginning on-April :1, 1997 and.on`each October 1 and April.1 thereafter until maturity or- earlier redemption as more fully described herein. First Union National Bank of Florida, Jacksonville, Florida is serving-as-Registrar and Paying Agent for the Series 1:997 Bonds.;- The System The:City operates a municipal-water production and-distribution system as well as a .municipal:wastewaters collection,, treatment_and-disposal system. The water system (the "Water System").currently consists of three water treatment sites with aicombined permitted capacity:of 3.342 million gallons:per day (".mgd") and approximately 175 miles of water mains. 111 The wastewater system (the "Sewer System") currently consists of one wastewater treatment plant, 32 pump stations, approximately 40 miles of sewage collection system piping,,.280 acres of property available for effluent disposal and has a current treatment capacity of 3.0 mgd. The existing operating permit is valid through September 20, 2001. Purpose of the Series 1997 Bonds The Series 1997 Bonds are being issued pursuant to the Constitution and laws of the State of:Florida, particularly Chapter 166, Part II, Florida Statutes and other applicable provisions of law, (the 'Act"),. the Charter of the.City of Ocoee, Resolution No. 93-02, adopted by the City Commission of the City on February 2, 1993; as amended and supplemented (collectively, the "Resolution"), in particular as amended and supplemented by Resolution No. 96-32, adopted by the City Commission of the City on December 3, 1996, to provide funds to: (i) expand the capacity of and construct and acquire other improvements to the City's water and sewer system(the "System"), (ii) acquire a surety bond in an amount equal to the Reserve Requirement for the Series 1997 Bonds for deposit into the account in the Reserve Fund established for the benefit of the Series 1997.Bonds, and (iii) pay costs of issuance of the Series 1997 Bonds, including the municipal bond insurance premium. Security and Sources of Payment for the Bonds; Parity Bonds - The Series 1997 Bonds and the interest thereon are payable solely from and secured by a prior lien upon and pledge of(i)the Net Revenues of the System; (ii) the Sewer System Development Charges, but only to the extent of the Sewer System Development Charges Bond Service Component, (iii) the Water System Development Charges, but only to the extent of the Water System Development Charges Bond Service Component, and (iv) until applied.in accordance.with the provisions of the Resolution, certain moneys including investment thereof;_in the funds and,accounts.(except the Rebate Fund) established by the Resolution (collectively; the "Pledged Funds")...Such prior lien and pledge of the Pledged Funds is on a parity:with the lien and pledge granted to the holders of theCity's Water and Sewer System Refunding °and Improvement..Revenue Bonds, Series 1993 (the "Parity Bonds"), which are currently outstanding in the aggregate principal`amount of$7,850,000, and any Additional Bonds subsequently issued pursuant to the Resolution. The Series 1997 Bonds and the interest thereon shall not be or constitute a general indebtedness or general obligation Of the City within the meaning of any'constitutional, statutory or charter provision or limitation, and the City has not:pledged its full faith and credit for the.payment of the principal of, redemption premium, if any, and interest on the Series 1997 Bonds or the making of any reserve or other payments provided for in the Resolution. No Series 1997 Bondholder shall ever have the right to require or compel the exercise of the ad valorem taxing power of the City or taxation in any form on any real or iv personal property of or in the City:for the payment of the principal of, redemption premium, if any, and interest on the Series 1997 Bonds or the making of any reserve or other payments in connection therewith. • The Series 1997 Bonds shall not constitute a lien upon the System, or any part thereof, or on any other real or personal property of or in the City, but shall constitute a lien only on the Pledged Funds all in the manner provided in the.Resolution and described herein. See "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1997 BONDS" herein. Reserve Fund The Resolution provides for the establishment and maintenance of a Reserve Fund and provides for separate accounts within the Reserve Fund for each Series of Bonds issued pursuant to the Resolution. Upon delivery of the Series 1997 Bonds, the City shall deposit a surety bond in an amount equal to the Reserve Requirement to the separate account of the Reserve Fund established for the benefit of the Series 1997 Bonds. Rate Covenant - The City covenants in the Resolution to fix, establish, revise from time to time, whenever necessary, maintain and collect always such fees, rates, rentals and other charges for the use of the products, services and facilities of the System which will always provide Revenues in each year sufficient to pay: (i) the aggregate of the amount needed to pay all Costs of Operation and Maintenance as the same shall become due in such.year, 100% of the Bond Service Requirement becoming due in such year on.the Outstanding Bonds, and 100% of all other deposits to be made pursuant to the Resolution and (ii) together with Sewer System Development Charges in an amount not greater than the Sewer System Development Charges Bond Service Component and the Water System Development Charges in an amount not greater than the Water System Development Charges Bond Service Component, the aggregate of the amount needed to pay the Cost of Operation and Maintenance as the same shall become due in such year, 110% of the Bond Service Requirement coming due in such year on the Outstanding Bonds, and 100% of all other deposits to be made pursuant to the Resolution. Such rates, fees,'rental or other charges shall not be reduced so as to render them insufficient to provide revenues for such purposes. Municipal Bond Insurance . Payment of the principal of and interest, when due, on the Series 1997 Bonds will be insured by a municipal bond insurance policy to be issued by AMBAC Indemnity Corporation simultaneously with the issuance of the Series 1997 Bonds. For a discussion - v - of the terms: and provisions of that policy, including the limitations - thereof,- see "MUNICIPAL BOND INSURANCE" herein and Appendix G hereto. - Additional Bonds Upon compliance with certain requirements set forth in the Resolution, the City may issue Additional Bonds payable on a parity with the Parity Bonds and the Series 1997 Bonds. See "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1997 BONDS — Additional Bonds" herein. • • vi • OFFICIAL STATEMENT $10,500,000* CITY OF OCOEE, FLORIDA Water and Sewer System Improvement Revenue Bonds, Series 1997 INTRODUCTION The purpose of this Official Statement, including the cover page, the Summary Statement and all appendices, is to set forth certain information in connection with the sale by the City of Ocoee, Florida (the "City") of its $10,500,000* aggregate principal amount of Water and Sewer System Improvement Revenue Bonds, Series 1997 (the "Series 1997 Bonds"). The Series 1997 Bonds are being issued pursuant to the Constitution and Laws of the State of Florida, including Chapter 166, Part II, Florida Statutes and other applicable provisions of law (the "Act"), the Charter of the City of Ocoee, Resolution No. 93-02, adopted by the City Commission of the City on February 2, 1993, as amended and supplemented, in particular as amended and supplemented by Resolution No. 96-32, adopted by the City Commission of the City on December 3, 1996 (collectively, the "Resolution"). The Series 1997 Bonds are being issued, together with other legally available funds to: (i) expand the capacity of and construct and acquire other improvements (the "Project") to the City's water and sewer system (the,"System"), (ii) acquire a surety bond in an amount equal to the Reserve Requirement for the Series 1997 Bonds for deposit into the account in the Reserve Fund established for the benefit of the Series 1997 Bonds, and (iii) pay costs of issuance of the Series 1997 Bonds, including the municipal bond insurance premium. For additional information concerning the use of the proceeds of the Series 1997 Bonds, see "ESTIMATED SOURCES AND USES OF FUNDS" herein. The Series 1997 Bonds and the interest thereon are payable solely from and secured by a prior lien upon and a pledge of: (i) the Net Revenues of the System, (ii) the Sewer System Development Charges, but only to the extent of the Sewer System Development Charges Bond Service Component, (iii) the Water System Development Charges, but only to the extent of the Water System Development Charges Bond Service Component, and (iv) until applied in accordance with the provisions of the Resolution, certain moneys, including investments thereof, in the funds and accounts (other than the Rebate Fund) established by *Preliminary, subject to change. the Resolution (collectively, the "Pledged Funds"). Such prior lien on and pledge of the Pledged Funds is on a parity with the lien on and pledge of the Pledged Funds that has been granted to the holders of the City's Water and Sewer System Refunding and.Improvement Revenue Bonds, Series 1993 (the "Parity Bonds") currently outstanding in the aggregate principal amount of$7,850,000 and which may, in the future, be granted in connection with the issuance of any Additional Bonds. For additional information concerning the security for and source of payment of the Series 1997 Bonds, see "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1997 BONDS" herein. This Official Statement speaks only as of its date and the information contained herein is subject to change. Capitalized terms used but not defined in this Official Statement have the same meanings as used in the Resolution, unless the context clearly indicates otherwise. Complete descriptions of the terms and conditions of the Series 1997 Bonds are set forth in the Resolution, a summary of certain provisions of which is attached to this Official Statement as Appendix D. The description of the Series 1997 Bonds, the documents authorizing and securing the same, and the information from various reports and statements contained herein are not comprehensive or definitive. All references herein to such documents, reports and statements are qualified by the entire, actual content of such documents, reports and statements. Copies of such documents, reports and statements referred to herein that are not included in their entirety in this Official Statement may be obtained, after payment of applicable copying and mailing costs, from the City of Ocoee, at 150 North Lakeshore Drive, Ocoee, Florida 34761, Attention: City Manager. SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1997 BONDS General The Series 1997 Bonds are payable solely from and secured by a prior lien upon and pledge of (i) the Net Revenues derived from the operation of the. System, (ii) the Sewer System Development Charges, but only to the extent of the Sewer System Development Charges Bond Service Component, (iii) the Water System Development Charges, but only to the extent of the Water System Development Charges Bond Service Component, and (iv) until applied in accordance with the provisions of the Resolution, certain moneys, including investments thereof, in the funds and accounts (other than the Rebate Fund) established by the Resolution (collectively, the "Pledged Funds"). In the Re olution, the City irrevocably pledges the Pledged Funds to the payment of the principal of, redemption premium, if any, and interest on the Series 1997 Bonds and the Parity Bonds, the reserves for the Series 1997 Bonds and the Parity Bonds and all other payments required under the Resolution. 2 The Series 1997 Bonds and the interest thereon do not constitute a general indebtedness of the City within the meaning of any constitutional, statutory or charter provision or limitation, and the City has not pledged its full faith and credit for the payment of the principal of, redemption premium, if any, and interest on the Series 1997 Bonds. No Series 1997 Bondholder shall ever have the right to require or compel the exercise of the ad valorem taxing power of the City or taxation of any real or personal property of or in the City for the payment of the principal of, redemption premium, if any, and interest on the Series 1997 Bonds or the making of any reserve or other payments provided for in the Resolution. The Series 1997 Bonds and the indebtedness evidenced thereby do not constitute a lien upon the System, or any part thereof, or on any other property of or in the City, but shall constitute a lien only on the Pledged Funds all in the manner provided in the Resolution. The Resolution establishes the Revenue Fund, the Debt Service Fund (which includes the Principal Account, the Interest Account and the Redemption Account), the Reserve Fund, the.Sewer System Development Charges Fund, the Water System Development Charges Fund and the Construction Fund. All such funds and accounts will be held by the City as trust funds, but no independent trustee has been appointed to hold the moneys in such funds for the benefit of the Holders of the Series 1997 Bonds. For information on all funds and accounts and the disposition and flow of revenues, see "APPENDIX D — SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION—Funds and Accounts; Flow of Funds." The designation and establishment of the various funds and accounts by the Resolution does not require the establishment of.any completely independent,self-balancing funds as such term is commonly defined and used in government accounting, but rather is intended solely to constitute an earmarking of certain revenues of the System for certain purposes and to establish certain priorities for application of such revenues as provided in the Resolution. Development Charges Pursuant to the Resolution, Sewer System Development Charges and Water System Development Charges are defined as the impact fees and capital charges levied upon and collected from new users of the Sewer System and Water System, respectively (or the proceeds of any security provided for the payment thereof), if any, to the extent the same are lawfully available for the acquisition and construction of Sewer Expansion Facilities and Water Expansion Facilities, respectively, and for Sewer System Development Charges Bond Service Component and for Water System Development Charges Bond Service Component, respectively. Such Development Charges do not include Connection Charges. Pursuant to the City Code and various ordinances of the City,the City imposes water capital charges and sewer capital charges that are based on equivalent residential units 3 ("ERUs"), which.are the City's estimates: of the average daily water and sewer capacity usage, in gallons per day, for a single family residential household.. The City has assigned a value of 300 gallons per day per ERU for water capacity and 27Q gallons per day per ERU for sewer capacity:, The City imposes a water.capital charge of$966 per ERU for the cost of providing water treatment facilities and extending water distribution and treatment lines to a point of reasonable availability for connection to the Water System. The City.also imposes a sewer capital charge of$2,865 per ERU for the cost of providing sewage.treatment facilities, effluent disposal facilities and pumping stations and extending sewer collection lines to a,reasonable point of availability to the Sewer System. Such.capital charges are due at the time the City issues a building,permit. Only the Sewer System Development.Charges Bond Service Component and the Water System Development Charges Bond Service Component, that.portion of the debt service op the Series 1997 Bonds and Parity Bonds for a given year determined by. multiplying the debt service on the Series 1997 Bonds and.Parity.Bonds for that given year by the percentage of the cost.of the projects fmanced from the proceeds of the Series 1997 Bonds and Parity,Bonds attributable to Sewer. Expansion-Facilities-and Water Expansion Facilities, respectively, are pledged to the.Series 1997 Bonds and-Parity Bonds. -Pursuant to the Resolution, the portion of the projects financed with proceeds of the. Series 1997 Bonds and.Panty Bonds which is attributable to Sewer Expansion Facilities and:Water ` Expansion Facilities is determined by the Qualified Independent Consultant and set forth in a Project Certificate. The.City's Consulting Engineer:will set forth in a Project Certificate at the time of delivery of the Series 1997 Bonds that 100% of the Project to be financed with the proceeds of the Series 1997 Bonds are:Expansion Facilities. . In addition, 100% of the projects fmanced with the Parity.: Bonds are Expansion Facilities: Under Florida law, impact fees may be validly imposed against new construction in order to fund capital improvements which are necessitated by such new construction or for debt service for bonds or other obligations issued for such purposes. Proceeds of the fees must be placed in separate accounts and used only for the capital improvements attributable to the new construction. .Pursuant'to the Resolution, all Sewer System Development Charges are required, upon receipt, to be deposited in:the Sewer System Development Charges Fund and all Water System Development Charges are required, upon receipt, to be deposited in, the Water System Development Charges Fund: , Impact fees have frequently been the subject of litigation in Florida.and the City's development charges have.not yet been tested in court. There can,:therefore, be no assurances that, if challenged,the City's development charges-would be found valid. Impact fee revenues fluctuate with the amount of new construction which.occurs. There can, therefore, be,no assurances that such revenues will not decrease or be eliminated 4 . altogetherin,the.event that new construction, for whatever reason, might decrease or cease altogether within the City. :Rate Covenant. , . • _ . The City covenants in the Resolution to fix, establish, revise from time to time, whenever necessary, maintain and collect always such fees, rates, rentals and other charges for the use.of the products, services and facilities.of the.System which, together with other Pledged Funds, will always provide Revenues in each year sufficient to pay (i) 100% of the aggregate of the amount needed to pay all Costs of Operation and Maintenance as the same shall become due in such year, 100%of all Bond Service Requirement becoming due in.such year on the Outstanding Bonds and 100% of all other deposits to be.made pursuant to the Resolution and(ii)together with the Sewer System Development Charges in an amount not greater than the Sewer System Development Charges Bond Service Component and the Water System Development Charges in an amount not_greater than the Water System Development Charges Bond Service Component, the aggregate of the amount needed to pay the Cost of Operation and Maintenance as the same shall-become due in such year, 110% of the Bond Service Requirement coming due in such:year on the Outstanding Bonds, and 100%of all other deposits to be made pursuant to the Resolution. Such rates, fees, rental or other charges shall not be reduced so as to render them insufficient to provide revenues for such purposes. Revenues are defined as.all income or earnings, including. Connection Charges, received by the City:or accrued to the City from the ownership; use or operation of the System and all parts thereof, including investment income, if any,'earned on any fund or account created pursuant to the Resolution,:and on any fund or account established by the City for the'System, all as calculated in accordance with generally'accepted accounting principles, but "Revenues" shall not include proceeds from the sale or other disposition of the System or any part thereof, condemnation awards or proceeds of insurance received with respect to the System. Further, "Revenues" do not include Sewer System Development ,, Charges or.Water.System.Development Charges or Contributions in Aid of Construction. Reserve Fund The iResolution provides for the establishment and maintenance of a Reserve Fund and provides for separate accounts within the Reserve Fund for each Series of Bonds,issued pursuant to the Resolution. Upon delivery of the Series 1997 Bonds, the City shall deposit a surety bond issued by AMBAC Indemnity in an amount equal to the Reserve Requirement to the separate account in the Reserve Fund established for the benefit of the Series 1997 , Bonds.. Pursuant to the Resolution, the "Reserve Requirement".is defined as the lesser of: (i) the Maximum Debt Service Requirement, (ii) one and one-quarter times.the Average 5 Annual Debt Service Requirement, or (iii)' such amount as will not adversely affect the exclusion of interest on the Series 1997 Bonds from the gross income of the holders of the Series 1997 Bonds for purposes of Federal income taxation. The City previously established a separate account in the Reserve Fund for the Parity Bonds which is funded in an amount equal to the Reserve Requirement for such Bonds. Upon delivery of the Series 1997 Bonds, a surety bond issued by AMBAC Indemnity in an amount equal to the Reserve Requirement for the Parity Bonds will be deposited into the separate account of the Reserve Fund for the Parity Bonds and the funds in such account will be used for the Project. Proceeds of the surety bonds on deposit in each account in the Reserve Fund shall be applied in accordance with the provisions of the Resolution solely for the purpose of the payment of Amortization Installments, principal of, or interest on the Outstanding Series of Bonds for which such account was established and for no other Series of Bonds. Therefore, proceeds of the surety bond on deposit in the special account established for the benefit of the Series 1997 Bonds may not be used to pay Amortization Installments, principal or interest on the Parity.Bonds and any other Series of Additional Bonds. Any withdrawals from an account in the Reserve Fund shall be subsequently restored from the first moneys available in the Revenue Fund, on-a pro rata basis as to all accounts in the Reserve .Fund, after all required current payments for Cost of Operation and Maintenance and all current applications and allocations to the Debt Service Fund, including all deficiencies for prior payments, have been made in full. Notwithstanding the foregoing, in no event shall the City be required to deposit into any=account in the Reserve Fund an amount greater than that amount necessary to ensure that the'difference between the Reserve Requirement for the Series of-Bonds for which such account was established and the amounts on deposit in such account on the date of calculation shall be restored not later than 60 months after the date of such deficiency (assuming equal monthly payments into such account for such 60 month period). . Additional Bonds - Additional Bonds having a lien on and pledge of the Pledged Funds equal to that of the Series 1997 Bonds and Parity Bonds may be issued by the City to finance the cost of acquiring, constructing or completing an Additional Project or refunding any or all outstanding Bonds or any Subordinated Indebtedness. Before issuing Additional Bonds, the City must obtain_and file in its public records a statement of an independent certified public accountant of reasonable experience and responsibility (the "CPA Certificate") which provides as follows: (a) stating that the books'and records of the City relating to the Pledged Funds have been examined by him or her; (b) setting forth the amount of Pledged Funds which have been received by the City during any 12 consecutive months designated by the City within the 24 months immediately preceding the date of delivery of such Additional 6 Bonds, including the Series 1997 Bonds, with respect to which such statement is made; (c) stating that the amount of the Net Revenues received during the aforementioned 12 month period equals at least 100% of the Maximum Annual Debt Service of all Bonds then Outstanding and such Additional Bonds with respect to which such CPA Certificate is obtained; (d) stating that the amount of the Net Revenues together with the Sewer System Development Charges in an amount not greater than the Sewer System Development Charges Bond Service Component and the Water System Development Charges in an amount not greater than the Water System Development Charges Bond Service Component received during the aforementioned 12 month period equals at least 110% of the Maximum Annual Debt Service of all Bonds then Outstanding and the Additional Bonds with respect to which such CPA Certificate is obtained; (e) stating that the Net Revenues projected for the 12 month period following the issuance of such Additional Bonds is projected by the Consulting Engineer to equal not less than 100% of the Maximum Annual Debt Service on the Bonds and any proposed Additional Bonds; and (f) stating that the Net Revenues together with the Sewer System Development Charges in an amount not greater than the Sewer System Development Charges Bond Service Component and the Water System Development Charges in an amount not greater than the Water System Development Charges Bond Service Component projected for the 12 month period following the issuance of such Additional Bonds is projected by the Consulting Engineer to equal not less than 110% of the Maximum Annual Debt Service on the Bonds and any proposed Additional Bonds. The Net Revenues contained in the CPA Certificate may be adjusted upon recommendation by the Consulting Engineers by including: (a) 100%of the additional Net Revenues which, in the opinion of the Consulting Engineers, would have been derived by the City from rate increases adopted before the Additional Bonds are issued if such rate increases had been implemented before the commencement of the period for which Pledged Funds are being certified; and (b) 100%of the additional Net Revenues which, in the opinion of the Consulting Engineers, will be derived during the first full 12-month period after the date of placing in service the Additional Project financed with the proceeds of the Additional Bonds. The above conditions shall not apply to any Additional Bonds issued for the purpose of refunding any Bonds, provided that the issuance of such Additional Bonds does not increase the aggregate amount of principal and interest on the Outstanding Bonds coming due in the current Fiscal Year and all subsequent Fiscal Years. 7 • Subordinated Indebtedness The City may also at anytime, or from time-to time, issue evidences of indebtedness :payable in whole or in part out of the Pledged Funds and which may be secured by a pledge of the Pledged Funds; provided, however, that such pledge shall be, and shall be expressed to be, subordinated in,-all respects::to the pledge of the Pledged. Funds created by the Resolution. _ . Investments The Construction:Fund, the Revenue Fund, the Debt Service-Fund;the.Reserve Fund :and all accounts and subaccounts in such funds,shall be continuously secured in:the manner by:which the deposit of public funds are authorized to be secured byahe laws of.the.State of Florida. .Moneys on deposit in the Construction.Fund, the Debt;Service Fund, the Reserve Fund.:(except the,reserve account forthe Series 11997 Bonds), the Revenue Fund, the.Sewer System Development Charges Fund, the Water. System Development Charges Fund and all : accounts and subaccounts.in such funds may be.invested:and reinvested by the City,and,as directed by=the City in Permitted Investments maturing no later than the date on which the moneys therein will be needed. Any and all income received by the City from the investment of moneys in each„fund or account created pursuant: to the Resolution,: except the Construction Fund, shall be retained in such respective fund or account until the amount required to be on deposit therein shall be on deposit in-such fund or account, and thereafter shall be transferred to the Revenue Fund.. Any and all income received from the investment of moneys in the Construction Fund shall remain on deposit in such fund until the amounts -required to complete the Project are on deposit therein; and:thereafter shall be transferred to the Revenue Fund. . Nothing contained in the Resolution shall prevent any Permitted;Investments acquired as investments of or security for funds held under the Resolution from being issued or held :in book-entry formon;the books:.of the Department of:Treasury of the United States. Other Covenants =. Pursuant to::the Resolution;,the City has additionally covenanted: (i).not to render or cause to be rendered.either free of charge or for a nominal charge to any person, firm or corporation, public;or private, the services and commodities of the System, provided the City may, on behalf of the City or on behalf of any person, firm or corporation, pay for such facilities, services and commodities with legally available funds of the City, other than Pledged Funds, (ii)to the full extent permitted bylaw, not to grant'any franchise,-license or permit for the construction or operation or any competitive water and sewer facilities in the territorial area serviced by the City which the City determines will adversely affect Revenues, and(iii) to diligently enforce and collect the rates, fees and charges for the service and facilities of the System. See "THE SYSTEM — Territorial Agreement" and "SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION" in Appendix D hereto. MUNICIPAL BOND INSURANCE The following information has been furnished by AMBAC Indemnity Corporation ("AMBAC Indemnity") for use in this Official Statement. See Appendix G hereto for a specimen of the AMBAC Indemnity's policy. Payment Pursuant to Municipal Bond Insurance Policy AMBAC Indemnity has made a commitment to issue a municipal bond insurance policy (the "Municipal Bond Insurance Policy") relating to the Series 1997 Bonds effective as of the date of issuance of the Series 1997 Bonds. Under the terms of the Municipal Bond Insurance Policy, AMBAC Indemnity will pay to the United States Trust Company of New York, New York, in New York, New York or any successor thereto (the "Insurance Trustee") that portion of the principal of and interest on the Series 1997 Bonds which shall become Due for Payment but shall be unpaid by reason of Nonpayment by the City (as such terms are defined in the Municipal Bond Insurance Policy). AMBAC Indemnity will make such payments to the Insurance Trustee on the later of the date on which such principal and interest becomes Due for Payment or within one business day following the date on which AMBAC Indemnity shall have received Notice of Nonpayment from the Paying Agent. The insurance will extend for the term of the Series 1997 Bonds and, once issued, cannot be cancelled by AMBAC Indemnity. The Municipal Bond Insurance Policy will insure payment only on stated maturity dates and mandatory sinking fund installment dates, in the case of principal, and on stated dates for payment, in the case of interest. If the Series 1997 Bonds become subject to mandatory redemption and insufficient funds are available for redemption of all outstanding Series 1997 Bonds, AMBAC Indemnity will remain obligated to pay principal of and interest on outstanding Series 1997 Bonds on the originally scheduled interest and principal payment dates including mandatory sinking fund redemption dates. In the event of any acceleration of the principal of the Series 1997 Bonds, the insured payments will be made at such times and in such amounts as would have been made had there not been an acceleration. In the event the Paying Agent has notice that any payment of principal of or interest on a Series 1997 Bond which has become Due for Payment and which is made to a Series 1997 Bondholder by or on behalf of the City.has been deemed a preferential transfer and 9 theretofore recovered from its registered owner pursuant to the United States Bankruptcy Code in accordance,with a final, nonappealable order of a court of competent jurisdiction, such registered owner will be entitled to payment from AMBAC Indemnity to the extent of such recovery if sufficient funds are not otherwise available. The Municipal Bond Insurance Policy does not insure any risk other .than Nonpayment, as defined in the Policy.. Specifically, the Municipal Bond Insurance Policy does not cover: 1. payment on acceleration, as a result of a call for redemption (other than mandatory sinking fund redemption) or as a result of any other advancement of maturity; 2. payment of any redemption, prepayment or acceleration premium; or 3. nonpayment of principal or interest caused by the insolvency or negligence of any Trustee or Paying Agent, if any. . If it becomes necessary to call upon the Municipal Bond Insurance Policy, payment of principal requires surrender of Series 1997 Bonds to the Insurance Trustee together with an appropriate instrument of assignment so as to permit ownership of such Series 1997 Bonds to be registered in the name of AMBAC Indemnity to the extent of the payment under the Municipal Bond Insurance Policy. Payment of interest pursuant to the Municipal Bond Insurance Policy requires proof of Series 1997 Bondholder entitlement to interest payments and an appropriate assignment of the Series 1997 Bondholder's right to payment to AMBAC Indemnity. . Upon payment of the insurance benefits, AMBAC Indemnity will become the owner of the Series 1997 Bond, appurtenant coupon, if any, or right to payment of principal or interest on such Series 1997 Bond and will be fully subrogated to the surrendering Series 1997 Bondholder's rights to payment. . The insurance provided by the Municipal Bond Insurance Policy is not covered by the Florida Insurance Guaranty Association. AMBAC Indemnity Corporation AMBAC Indemnity is a Wisconsin-domiciled stock insurance corporation regulated by the Office of the Commissioner of Insurance of the State of Wisconsin and licensed to do business . in 50 states, the District of Columbia, the Territory of Guam and the Commonwealth of Puerto Rico, with admitted assets of approximately $2,505,000,000 (unaudited) and statutory capital of approximately$1,384,000,000 (unaudited) as of June 30, 10 1996. Statutory capital consists of AMBAC Indemnity's policyholders' surplus and statutory contingency reserve. AMBAC Indemnity is a wholly owned subsidiary of AMBAC Inc., a 100% publicly-held.company. Standard & Poor's Rating Services, a division of The McGraw-Hill Companies, Inc. and Moody's Investors Service have each assigned a triple-A claims-paying ability rating to AMBAC Indemnity. AMBAC Indemnity has entered into pro rata reinsurance agreements under which a percentage of the insurance underwritten pursuant to certain municipal bond insurance programs of AMBAC Indemnity has been and will be assumed by a number of foreign and domestic unaffiliated reinsurers. AMBAC Indemnity has obtained a ruling from the Internal Revenue Service to the effect that the insuring of an obligation by AMBAC Indemnity will not affect the treatment for federal income tax purposes of interest on such obligation and that insurance proceeds representing maturing interest paid by AMBAC Indemnity under policy provisions substantially identical to those contained in the municipal bond insurance policy shall be treated for federal income tax purposes in the same manner as if such payments were made by the City. AMBAC Indemnity makes no representation regarding the Series 1997 Bonds or the advisability of investing in the Series 1997 Bonds and makes no representation regarding, nor has it participated in the preparation of, the Official Statement other than the information supplied by AMBAC Indemnity and presented under the heading "MUNICIPAL BOND INSURANCE." Available Information The parent company of AMBAC Indemnity, AMBAC Inc. (the "Company"), is subject to the informational requirements of the Securities Exchange Act of 1934, as amended(the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Such reports, proxy statements and other information may be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 and at the Commission's regional offices at 7 World Trade Center, New York, New York 10048 and Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained from the public reference section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. In addition, the aforementioned material may also be inspected at the offices of the New York Stock Exchange, Inc. (the "NYSE") at 20 Broad Street, New York, New York 10005.. The Company's Common Stock is listed on the NYSE. - 11 Copies of AMBAC:Indemnity's financial statements prepared in accordance with statutory accounting standards- are available from AMBAC Indemnity. The address of AMBAC-Indemnity's administrative offices and its telephone number are One State Street Plaza, 17th Floor, New York,New York.10004. and (212) 668-0340. Incorporation of Certain Documents by Reference The following documents filed by the Company with the Commission (File NO: 1- 10777)are incorporated by reference in this.Official Statement: . (1). The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995,. filed on April 1, 1996; (2) The Company's Current Report on Form 8-K dated January 31, 1996'and filed. on February 28, 1996; . (3) The Company's Current Report on Form 8-K dated March 13, 1996 and filed on March 14, 1996; (4). .The Company's Current-Report Form 8-K/A, First Amendment to.Current Report on Form'8-K dated March 13; 1996 and filed on March 15, 1996; (5) The Company's Quarterly Report on Form 10-Q for the quarterly period ended March 3.1, 1996 and filed on May 15, 1996; and (6) The Company's Quarterly Report on Form 10-Q for the-quarterly period ended June_30, 1996 and filed on August 14, .1996. . All documents subsequently filed by the Company pursuant to the requirements of the Exchange Act after the date of this Official Statement will be available for inspection-in the same manner as described above under the heading "MUNICIPAL BOND INSURANCE POLICY.- Available Information:" • THE SERIES 1997'BONDS General .:. The Series 1997 Bonds.shall be issued in-fully registered form, without coupons, in: the denomination of$5;000 each, or integral'multiples thereof, shall be dated,shall bear 12 interest computed on the basis of a 360-day year of twelve 30-day months at the rates and shall mature on the dates and in the amounts shown on the cover page hereof. The Series 1997 Bonds shall bear interest from the interest payment date next preceding the date on which it is authenticated, unless authenticated on an interest payment date, in which case it shall bear interest from such interest payment date, or unless authenticated prior to the first interest payment date, in which case it shall bear interest from its date. However, if at the time of authentication payment of any interest which is due and payable has not been made, such Series 1997 Bond shall bear interest from the date to which interest shall have been paid. The interest on the Series 1997 Bonds shall be payable by the Paying Agent, by check or draft on each interest payment date, to the registered owner thereof at the address as shown on the registration books kept by the Registrar at the close of business on the fifteenth day of the calendar month immediately preceding such interest payment date (the "Record Date"). At the written request and expense of a registered owner of$1,000,000 or more of Series 1997 Bonds, interest may be paid to such registered owner by wire transfer or other medium acceptable to the City and the Paying Agent. Payment of the principal of all Series 1997 Bonds shall be made, when due, upon the presentation and surrender of such Series 1997 Bonds at the office of the Paying Agent as the same shall become due and payable. Only Series 1997 Bonds which have endorsed thereon a certificate of authentication duly executed by the Registrar, as authenticating agent, shall be entitled to any benefit or security under the Resolution. No Series 1997 Bond shall be valid or obligatory for any purpose unless such certificate of authentication shall have been duly executed by the Registrar. The Series 1997 Bonds, upon surrender thereof at the office of the Registrar with a written instrument of transfer satisfactory to the Registrar, duly executed by the Holder thereof or such Holder's attorney duly authorized in writing, may, at the option of the Holder thereof, be exchanged for an equal aggregate principal amount of registered Bonds of the same type and maturity of the Bonds so surrendered. Series 1997 Bonds shall be transferable only upon the books of the City, at the office of the Registrar, under such reasonable regulations as the City may prescribe, by the Holder thereof in person or by such Holder's attorney duly authorized in writing upon surrender thereof together with a written instrument of transfer satisfactory to the Registrar duly executed and guaranteed by the Holder or such Holder's duly authorized attorney. The City, the Registrar and any Paying Agent or fiduciary of the City may deem and treat the person in whose name any Outstanding Bond shall be registered upon the books of the City as absolute owner of such Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal or Redemption Price, if applicable, 13 and interest on such Bond and for all other purposes, and all such payments so made to any such Holder, or upon such Holder's order, shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid and neither the City nor the Registrar nor any Paying Agent or other fiduciary of the City shall be affected by any notice to the contrary. For exchange or transfer of Series.1997 Bonds, the City or the Registrar charge'a sufficient amount to reimburse.it for any tax, fee, expense or other governmental charge required_to be paid with respect to such exchange or transfer. The City and the Registrar shall not be obligated to make any such exchange or transfer of Series 1997 Bonds during the 15 days next preceding an Interest Date on the Series 1997 Bonds, or, in the case of any proposed redemption of Series 1997 Bonds, then during the 15 days next preceding the date of the first mailing of notice of such redemption and continuing until such redemption date. In case any Series 1997 Bond shall become mutilated, or be destroyed, stolen or lost, the City may, in its discretion, issue and deliver, and the Registrar shall authenticate, a new Series 1997 Bond of like tenor as the Series 1997.Bond so mutilated, destroyed, stolen or lost, in exchange 'and substitution for such mutilated Series 1997 Bond or in lieu of and substitution for the Series 1997. Bond destroyed, stolen or lost, and upon the Holder furnishing the City and the Registrar proof of such' Holder's ownership thereof and satisfactory indemnity and complying with such other reasonable regulations and conditions as the City or the Registrar may prescribe and paying such expenses as.the City and the Registrar may incur. Optional Redemption The Series 1997 Bonds maturing on or prior to October 1, are not subject to redemption prior to their respective maturities. The Series 1997 Bonds maturing on or after October 1, are subject to redemption prior to maturity on or after October 1, at the option of the City, in whole at any time or in part on any interest payment date in such manner as shall be determined by the City and by lot within a maturity if less than a full maturity from any legally available moneys at a redemption price (expressed as a percentage of the principal amount) as set forth in the following table, plus accrued interest to the redemption date. Period During Which Redeemed Redemption (Both dates inclusive) Price October 1, : through September 30, October 1, through September 30, :. October 1, and thereafter 14 Mandatory Redemption . The Series 1997 Bonds which mature on October 1, are subject to mandatory redemption in part prior to maturity by lot, at redemption prices equal to 100% of the principal amount .thereof plus interest accrued to the redemption date, beginning on October 1, , and on each October 1 thereafter, in the following principal amounts in the years specified: Principal Year Amount *Maturity The Series 1997 Bonds which mature on October 1, . are,subject to mandatory redemption: in part prior to maturity by lot, at redemption prices equal to 100% of the principal amount thereof plus interest accrued to the redemption date, beginning on October.1, ,.and on each October 1 thereafter, in the following principal amounts in the. years specified: ... Principal . Year ' Amount . • *Maturity. The Series 1997 Bonds which mature on October 1, are subject to mandatory redemption in part prior to maturity by lot,.at redemption prices equal to 100% of the 15 principal amount thereof plus interest accrued to the redemption date, beginning on October 1, , and on each October 1 thereafter, in the following principal amounts in the years specified: Principal Year Amount *Maturity Notice of Redemption Notice of redemption of the Series 1997 Bonds must be: (i) filed with the Paying Agent; (ii) mailed, first class mail, postage prepaid, at least 30 days and not more than 60 days prior to the redemption date, to all Holders of Series 1997 Bonds to be redeemed at their addresses as they appear on the registration books.as of 15 days before the mailing date; and(iii)mailed by registered or certified mail, postage prepaid, or bytelecopy or facsimile transmission, at least 35 days before the redemption date, to the registered securities depositories and two or more nationally recognized municipal bond information services. Failure to mail such notice to one or more Holders of Series 1997 Bonds or any securities depositories or any defect therein shall not affect the validity of the proceedings for such redemption with respect to Holders of Series 1997 Bonds to which notice was duly mailed. Notice of any optional redemption of Series 1997 Bonds shall be given only upon the prior deposit into the Redemption Account of amounts sufficient to pay the principal of, interest accrued from the last interest payment date to the proposed redemption date and premium, if any, with respect to the Series 1997 Bonds to be redeemed. Upon surrender of any Series 1997 Bond for redemption in part only, the Registrar shall authenticate and deliver to the holder thereof a new Series 1997 Bond of an authorized denomination equal to the unredeemed portion of the Series 1997 Bond surrendered the cost of which shall be paid by the City. 16 ESTIMATED SOURCES AND USES OF FUNDS The proceeds to be received from the sale of the Series 1997 Bonds, including accrued interest on the Series 1997 Bonds to the date of delivery, are expected to be applied as follows: Sources of Funds Principal Amount of Series 1997 Bonds $ Less: Original Issue Discount Accrued Interest Total Sources $ Uses of Funds Deposit to Construction Fund (1) $ Costs of Issuance(2) Deposit of Accrued Interest to Interest Account Total Uses $ (1) Moneys used to fund a portion of the Project. (2) Includes underwriter's discount, costs of issuance and bond insurance and surety bond premiums. 17 SCHEDULED.:DEBT SERVICE:FOR THE SERIES 1997 BONDS Bond Year Series 1997. Bonds Ending "Aggregate Parity Bonds Total; October 1 Principal(1) Interest Debt Service Debt Service Debt Service 1997 $ 646,853.75 1998 647,716.25 1999 647,591.25 2000 646,722.50 2001. 644,962.50 2002 647,212.50 2003 648,442.50 2004 648,622.50 2005 647,722.50 2006 . 645,712.50 . 2007 ,647,562.50 . .' 2008 647,437.50 2009 646,162.50' 2010 . 648,737.50 2011. 649,875.00 2012 649,575.00 . 2013 647,837.50 2014 649,662.5.0 . 2015 644,762.50 . 2016 648,425.00: 2017 ,645,075.00 . 2018 2019 2020 ' 2021 2022 2023 2024 2025 2026 Total ' ' $13,596,671.25 . (1) Includes Amortization Installments for Term Bonds. 18 . THE CITY The City of Ocoee, Florida was incorporated in 1925. It is bounded on the west by Winter Garden, Florida, and on the south by Windermere, Florida, and has a land area of approximately 20.5 square miles, making it the second largest city in land area of the,thirteen cities in Orange County. As of April 1, 1996, the population of the City was estimated at 19,261, which ranks.the City third in population of the cities in Orange County. The City is governed by a Commission-Manager form of government. The four City Commissioners and the Mayor are elected on staggered two-year terms of office, who in turn appoint the City Manager. History and Organization The City of Ocoee, Florida, is a municipal corporation created under the laws of the State of Florida. The current Mayor and commissioners, the years in which their terms expire, and their principal occupations are as follows: Commissioner Expiration of Term ' Occupation S. Scott Vandergrift, Mayor February 1997 Real Estate Leon "Rusty" Johnson February 1997 Mail Carrier Jim Gleason . February 1998 Business Owner Scott A. Glass February 1997 Attorney Scott Anderson February 1998 Pilot For additional information concerning the City see Appendix A hereto. THE SYSTEM Introduction The Resolution defines the System as, collectively, the Water System and the Sewer System of the City. The Resolution defines the Water System as the complete water system now owned, operated and maintained by the City, together with any and all improvements, extensions and additions thereto hereafter constructed or acquired, together with all lands or interests therein, including plants, buildings, machinery, franchises, pipes, mains, fixtures, equipments and all property, real or personal, tangible or intangible, now or hereafter used in connection therewith. The Resolution defines the Sewer System as the complete sewer system now owned, operated and maintained by the City, together with any and all 19 improvements, extensions and additions thereto hereafter constructed or acquired, together with all lands or interests therein, including plants, buildings, machinery, franchises, pipes, mains, fixtures, equipment and all property, real or personal, tangible or intangible, now or hereafter used in connection therewith. The City initiated central water service in the early 1980's with construction of the Kissimmee Avenue Water Treatment Plant. The City expanded its water treatment service in 1986 by adding the Forest Oaks Water Treatment Plant. The newest water plant (South Water Treatment Plant) was added to the System in 1992 and the Kissimmee Avenue Plant was removed from service in 1994 due to age and obsolescence. The City initiated central wastewater in 1987 with.the acquisition of a private utility named Prima Vista Utilities. Initially the City provided water service to 650 ERUs. See "SECURITY AND SOURCES OF PAYMENT FOR THE SERIES 1997 BONDS -Development Charges" for a description of equivalent residential units and the values assigned by the City for an ERU of water capacity and an ERU of sewer capacity. At the present time, the City provides water and wastewater service to approximately 9,950 and 3,701 ERUs, respectively, located both within and outside the City's corporate limits. Of the water customers, approximately 7,861 ERUs are residential and approximately 2,089 ERUs are commercial. Of the wastewater customers, approximately 2,750 ERUs are residential and 951 ERUs are commercial. The following tables show the historic growth of the System's customers. The following table sets forth the total number of ERUs for the past five years: Historic Number of Water System ERUs Fiscal Year Total Water ERUs 1996 9,950 1995 9,437 1994 8,979 1993 8,505 1992 8,044 Source: City of Ocoee. 20 The following table sets forth the total number of sewer ERUs for the past five years: Historic Number of Sewer System ERUs January 1 Total Sewer ERUs 1996 3,701 1995 3,307 1994 2,917 1993 2,501 1992 2,117 • Source: City of Ocoee. Additional water and sewer customers derive principally from new developments constructed within the City's System service area. The City's municipal code requires all new developments within its System service area to connect to the wastewater system in accordance with Florida law. Pursuant to Florida law, a property owner utilizing a properly functioning septic system that can be reasonably connected to a wastewater system must connect to such system within one year of being notified by the owner of the wastewater system of the availability of the wastewater facilities. The owner of a wastewater system may, with the approval of the Florida Depailinent of Health and Rehabilitation Services, waive the mandatory connection requirement if it finds that mandatory connection is not required for public health reasons. Water and Sewer Territorial Agreements :. • The Water System provides potable water to the City's water service area and the Sewer System provides central wastewater service to the City's wastewater service area. The City's water service area and its wastewater service area comprise approximately 15 square miles and their boundaries, which include approximately 75% of the City's corporate limits and certain,unincorporated portions of Orange County, Florida (the "County"). The City's water service area is specifically described in the Water Service Territorial Agreement (Contract No. W-88-06) dated November 14, 1988 between the.City and Orange County, Florida (the_ "County"), as amended ( the "Water Territorial Agreement"). Pursuant to the Water Territorial Agreement, the City and Orange County have agreed that a designated portion of the City and unincorporated Orange County will be the exclusive water service area of the City and that the County will not provide water service within such areas. The City's designated service area may be amended from time to time based on future circumstances upon the mutual consent of both parties. The parties also agreed to permit each other to interconnect their water systems and to provide wholesale water service to the 21 connecting party at rates to be mutually agreed upon. The term of the Water Territorial Agreement began on November 14, 1988 and is effective for a period of 30 years (the "Initial Term"), with automatic renewals thereafter for one year periods. The Water Territorial Agreement may be canceled by either party after the Initial Term upon providing the other party with six months advance written notice. The City's wastewater service area is specifically described in that certain Orange County/Prima Vista Utility Company, Inc. Sewer Service Territorial Agreement (Contract No. S-87-8) dated June 8, 1987 between the Prima Vista Utility Company, Inc. (the "Utility") and the County, which was assigned by the Utility pursuant to that certain Assignment of Sewer System Territorial Agreement dated December 30, 1987 (collectively, the "Sewer Territorial Agreement"). Under the Sewer Territorial Agreement, the City and Orange County agreed that a designated portion of the City and unincorporated Orange County will be the exclusive sewer service area of the City and that the County will not provide sewer service within such areas. The City's designated sewer service area may be amended from time to time based on future circumstances upon the mutual consent of both parties. The parties also agreed to permit each other to interconnect their sewer systems and to provide wholesale sewer service to the connecting party at rates to be mutually agreed upon. The term of the Sewer Territorial Agreement beganon June 8, 1987 and is effective for a period of 30 years (the "Initial Term"), with automatic renewals thereafter for one year periods. The Water Territorial Agreement may be canceled by either party after the Initial Term upon providing the other party with six months advance written notice. Administration The System is administered by the City's Utility Director/City Engineer, who reports directly to the City Manager. The Utility Director/City Engineer is James W. Shira, who has been an employee of the City since 1989. Mr. Shira is responsible for overseeing System construction and for managing the System. Mr. Shira is assisted by the Assistant Utilities Director/Assistant City Engineer, David A. Wheeler. Both Mr. Shira and Mr. Wheeler are professional engineers, registered to practice engineering in the State of Florida. Mr. Shira is also assisted by other City departments, such as the Finance Department, the Planning Department, the Personnel Department and the Public Works Department. The City also employs a Utility Superintendent, Robert Holland. Mr. Holland has been employed by the City -since April, 1988. He possesses a Class "A" .wastewater license and a Class "C" drinking water license. Mr. Holland is responsible for the overall daily operations of the System facilities and personnel and he reports directly to Mr. Shira. Mr. David Gosnell is the Chief Water Plant Operator and has been employed by the City since October, 1983. Mr: Gosnell possesses a Class "A" drinking water license. Mr. Gosnell is in direct charge of all personnel and facilities related to production and treatment of potable water and he reports directly to Mr. Holland. Mr. Fred Ostrander is the City's Chief Wastewater Plant Operator 22 and has been employed by the City since December, 1987. He possesses a Class "B" wastewater license and a class "C" drinking water license. Mr. Ostrander is in direct charge of all personnel and facilities related to collection, transmission of wastewater, as well as distribution and disposal of treated effluent and he reports directly to Mr. Holland. Employees The System employs 37 persons, not including administrative support from other City departments. Twenty persons are employed by the City to service the Water System and 17 persons are employed by the City to service the Sewer System. The employees of the System are not represented by a union. The City considers its relationship with its - employees as amicable. The City contributes to a single employer defined benefit pension plan and trust (the "Pension Plan"). The contribution made by the City is allocated to the Water and Wastewater Fund based on covered payroll of employees whose salaries are charged to the Water and Wastewater Fund. Participation in the Pension Plan is a condition of employment. Benefits fully vest on reaching five years of service. Benefit provisions and all other requirements are established by City ordinance. Members of the Pension Plan are required to make regular contributions to the plan in the amount of 5%of their salary. The City is required to make quarterly contributions to the Pension Plan equal to the difference in each year, between the total aggregate member contributions and the total cost as shown by the most recent actuarial valuation of the Pension Plan. The City offers its employees a single employer deferred compensation plan created in accordance with Section 457 of the Internal Revenue Code (the "Deferred Compensation Plan"). The Deferred Compensation Plan is voluntary and any employee may elect to participate. The Deferred Compensation Plan permits employees to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. Water System The City receives its raw water through withdrawals from five existing City owned deep wells located at each of the City's three existing water treatment plants, which draw water from the upper Floridan Aquifer. The City currently has two additional deep wells under construction which will also draw raw water from the lower Floridan Aquifer. Raw 23 water is treated at each of the City's water treatment plants by a process that includes aeration for removal of hydrogen sulfide, disinfection by free residual chlorination and fluoridation. Treated water is routinely tested for bacteriological and chemical parameters in an outside certified laboratory to ensure compliance with applicable state and Federal regulations. Treated water is pumped to three water storage tanks located at each of the existing water treatment plants and then discharged to the System customers through the water distribution system. The City's three water treatment plants are briefly described below: 1. Jamela Plant. The Jamela Plant is located in the northern portion of the City's service area at Wurst Road and Jamela Drive. The Jamela Plant is the oldest water treatment plant in the Water System and it provides treated water to the. northern portion of the City's water service area. Raw water is supplied to the Jamela Plant from two of the City's deep wells, each of which are equipped with a vertical turbine low service pump that are rated at 550 gallons per minute ("gpm") and 2,000 gpm, respectively. Raw water is treated in a 500,000 gallon concrete ground storage tank and discharged into the water distribution system and into a 500,000 steel elevated storage tank by, three high service pumps. Two of the high service pumps are rated at 1,000 gpm and one is rated at 1,200 gpm. The Jamela plant is also equipped with a 250 kilowatt standby engine generator which is capable of operating the 2,000 gpm well and a high service pump in the event of a loss of primary power. The Jamela plant is not suitable for future expansion and upgrade. The Jamela Drive plant has its high service pumps and associated electrical panels located below grade in a concrete structure that was previously used as a water storage tank. Also, the existing elevated storage tank at this plant cannot be taken off-line for inspection or repair due to a frozen valve on the pipe which serves both to fill and empty the tank. Due to the deteriorated condition and high maintenance requirements of the Jamela plant, Professional Engineering Consultants, Inc., the Consulting Engineers to the City, has recommended that the Jamela plant be removed from service upon the completion of improvements to the Forest Oaks plant and the South plant. The City-anticipates removing the Jamela plant from service in 1998. 2. Forest Oaks Plant. The Forest Oaks plant is located in the northeast portion of the City's service area along Hackney-Prairie Road. The Forest Oaks plant has been in service for ten years and provides treated water to customers in the City's northern water service area. Raw water is supplied to the Forest Oaks plant from two of the City's deep wells, each of which are equipped with a vertical turbine low service pump that are rated at 700 gpm and 2,000 gpm, 24 respectively. A third deep well is presently under construction and will be equipped with a vertical turbine engine rated at 3,500 gpm. Raw water is treated in a 400,000 gallon concrete ground storage tank and discharged into the water distribution system by three high service pumps. Two of the high service pumps are rated at 800 gpm and one is rated at 1,500 gpm. The Forest Oaks plant is equipped with a 275 kilowatt standby engine generator which is capable of operating both deep wells, the 1,500 gpm high service pump and the 800 gpm high service pump in the event of a loss of primary power. 3. South Plant. The South Plant is located in the Southern portion of the City's service area approximately one mile south of State Road 50 and mile east of Maguire Road. The South plant was constructed in 1992 and provides treated water to customers in the City's southern water service area. Raw water is supplied to the South plant from a deep well, which is equipped with a vertical turbine low service pump that are rated at 3,500 gpm. A second deep well is currently under construction and will be equipped with a vertical low service pump rated at 3,00 gpm. Raw water is treated in a 670,000 gallon concrete ground storage tank and discharged into the water distribution system by four high service pumps. One of the high service pumps is rated at 370 gpm, two are rated at 540 gpm and the fourth one is rated at 1,350 gpm. The South plant is equipped with a 500 kilowatt standby engine generator which is capable of operating the entire South plant in the event of a loss of primary power. . The combined .maximum permitted. pumping capacity .of the three plants is approximately 5.53 million gallons per day ("mgd"). The current average monthly production is approximately 4.10 mgd. The Water System currently serves approximately 8,000 water customers, representing approximately 9,950 ERU's, with an additional 3,519 ERU's reserved through various developer agreements. These ERU's represent approximately 1.1 mgd of reserved capacity. . . The water consumptive use permits for the five City owned deep wells allow 3.342 mgd average day withdrawal and 6.684 mgd maximum day withdrawal. As shown in the table below, the average daily flow for the Water System in Fiscal Year 1996 was 3.912 mgd. The City's distribution system includes approximately 175 miles of localized piping ranging in size from 6 to 16 inches in diameter. The distribution system is divided into a northern piping network and a southern piping network, with the northern and southern isolated by a number of closed valves because of significant elevation differences between the central northern portion of the System and the remainder of the System. The City's water distribution system extends to all but the recently annexed northwestern portion of the City. 25 Historic Water Consumption Flows Fiscal Average Daily Year Flow (mgd) 1996 3.912 1995 3.680 1994 3.011 1993 3.072 1992 2.797 Source: City of Ocoee. See "APPENDIX B — ENGINEERING REPORT OF PROFESSIONAL ENGINEERING CONSULTANTS, INC." for additional information concerning the Water System. Sewer System The Sewer System currently consists of approximately 40 miles of sewage collection system piping, one wastewater treatment plant, 32 pumping stations, and 280 acres of property available for effluent disposal. Effluent disposal property consists of 40 acres of property located at the wastewater treatment plant and the City's 240 acre remote effluent disposal site, which the City has leased to Forest Lake Club, Ltd. and which has been converted into the Forest Lake Golf Course (the "Golf Course"). The City owns, operates and maintains approximately 40 miles of wastewater collection system, which utilizes a combination of gravity and force main systems to collect and transport wastewater to the wastewater treatment plant. The gravity wastewater collection system consists of PVC pipes ranging from 6 to 15 inches in diameter: The force main wastewater collection system consists of PVC and ductile iron pipes ranging from 6 to 12 inches in diameter. The City owns, operates and maintains 32 pump stations that are used for wastewater collection and discharge. The wastewater treatment plant is located at 1800 A.D. Mims Road, on a 128=acre site and was purchased from the Utility in 1988. The wastewater treatment plant is a poured in place concrete structure and utilizes a new and efficient Kruger Treatment Process (biodenitrofication) that results in substantial reduction of operation and maintenance expenses. The wastewater plant is equipped with tertiary filters, chemical feed and high- level disinfection facilities. The wastewater treatment plant has an estimated useful life of 50 years. The wastewater plant is staffed by operators with class "B" and "C" wastewater 26 licenses in accordance with state laws and DEP rules. The operation of the wastewater plant is highly automated and is computer controlled. The wastewater plant is staffed 8 hours per day, 5 days per week. Operational anomalies are detected by the automated process control system, and plant personnel are automatically notified by pager that a fault condition has occurred. This high level of control enabled DEP to issue a permit based on 8 hours per day on-site staffing rather than the standard 16 hours per day. The wastewater treatment plant is also capable of producing reclaimed water. Under normal operating conditions, all of the reclaimed water produced by the wastewater treatment plant is discharged to the Golf Course. The current designated treatment capacity at the waste water treatment plant is 3.0 mgd, with a permitted treatment capacity limited by the current permitted effluent disposal capacity of 1.5 mgd. The current average daily flow at the plant is approximately 0.9 mgd, equivalent to approximately 3,701 ERU's, generated by approximately 3,100 existing customers. There are approximately 3,840 ERU's of capacity reserved through various developer agreements. These ERU's represent approximately 1.1 mgd of reserved capacity. Treated wastewater is transported to the Golf Course through a 12 inch low pressure piping system. Effluent disposal is currently accomplished by: (1) irrigating the Golf Course with reclaimed water from the wastewater treatment plant (total capacity of 1.0 mgd); (2) discharging effluent to two on-site percolation ponds located at the site of the wastewater treatment plant (total capacity of 0.5 mgd); and (3) discharging effluent to two percolation ponds located at the Golf Course (total capacity of 1.0 mgd). The following table sets forth the historic wastewater treatment flows from the wastewater facilities: Historic Wastewater Treatment Plant Flows Fiscal Average Daily Year Flow (mgd) 1996 0.9466 1995 0.9430 1994 0.8215 1993 0.8114 1992 0.6750 Source: City of Ocoee. . 27 See "APPENDIX B — ENGINEERING REPORT OF PROFESSIONAL ENGINEERING CONSULTANTS, INC." for additional information concerning the Sewer System: Water and Wastewater Rates The System's rates structure includes a base facility charge and a volumetric consumption charge. Water and wastewater rates were adjusted on a System wide basis in 1992 following preparation of detailed cost of service rate studies. Historically, the City has adjusted water and sewer rates to meet increased revenue needs for the incurrence of new debt or to meet increased operating expenses. Because much of the System was originally designed and constructed to meet anticipated future increases in service demands. Since 1991, the monthly combined water and sewer charge for the typical residential customer who uses 10,000 gallons per month has increased from $40.56 to $41.25 per month. The following tables show the System's current rate structure: - Existing Water Rates Meter Size(Inches) Base Facility Charge 5/8 $ 7.64 1 . 19.10 1.5 38.20 2 61.12 3 122.24 4 191.00 6 382.00 8 611.00 10 878.60 12 1,642.60 . Plus: Volumetric charge of$0.51 per 1,000 gallons. Source: City of Ocoee Ordinance No. 92-19, adopted August 18, 1992. 28 Existing Wastewater Rates Meter Size (Inches) Base Facility Charge 5/8 $ 13.81 1 34.53 1.5 69.05 2 110.48 3 220.96 4 345.25 • 6 690.50 8 1,104.80 10 1,588.15 12 2,969.15 Volumetric charge of $1.47 per 1,000 gallons for residential customers with a 5/8 inch meter up to 12,000 gallons. Source: City of Ocoee Ordinance No. 92-19, adopted August 18, 1992. The City's present water and wastewater rates compare favorably with that of other municipal and county utility systems in the Central Florida area. The following chart presents comparative information for an average residential bill for the City and surrounding communities. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 29 Comparison of Monthly Water and Wastewater Billing in the City of Ocoee and Surrounding Areas' • Water Wastewater Total City of Ocoee $12.74 $28.51 $41.25 Other Similar Utilities Brevard County $19.49 $41.93 $61.42 Indian River County 32.70 43.98 76.68 Orange County 16.51 42.05 58.56 Seminole County . 11.70 30.00 41.70 City of Apopka 10.25 22.00 32.25 City of Casselberry 14.00 34.70 48.70 City of Lake Mary 19.80 35.00 54.80 City of Oviedo 11.50. 36.26 47.76 • City of Sanford 17.14 35.57 . 52.71 City of Winter Springs 11.30 3 6.3 3 47.63 City of Winter Park 7.75 23:81 31.56 City of Kissimmee 9.51 32.20 41.71 City of Orlando. 8.93 33.72 • 42.65 City of.Melboume 20.76 35.44 _ .56.20 City of Daytona Beach 23.21 33.48 56.69 City of Titusville • • 20.55 60.17 80.72 City of Cocoa 14.72 . 34.00 48.72 City of Winter Garden 11.73 26.18 37.91 Average $15.64 $35.38 • $51.02 (1) Based on average monthly water and waste water rates in effect as of September, 1996. Amounts shown are exclusive of taxes, franchise fees and outside City surcharges, if any. Based on 10,000 gallons of water usage monthly. Source: City of Ocoee. 30 Revenue and Maintenance Fees; Impact Fees; Other Charges and Deposits The City charges its customers a water and wastewater capital charge of$966 and $2,865, respectively.. These charges are derived using a marginal/incremental or standards driven methodology, which are based on the recovery of a new customer's proportionate share of the present value of capacity-related capital projects during a base period. The City imposes on customers holding water capacity an annual Revenue and Maintenance Fee of$93 per ERU or a monthly Revenue and-Maintenance Fee of$9 per ERU. The Revenue and Maintenance Fee is paid beginning on the 12-month anniversary of the date that the water capacity is acquired until a customer connects to the Water System and begins paying the rates set forth above. The City also imposes on customers holding sewer capacity an annual Revenue and Maintenance Fee of$121 per ERU or a monthly Revenue and Maintenance Fee of$13 per ERU. The Revenue and Maintenance Fee is paid beginning on the 12-month anniversary of the date a sewer capacity is acquired- until a customer connects to the City Sewer System and begins paying the rates set forth above. B.M.L. Investments, a Florida general partnership, has acquired and holds a substantial portion of such water and sewer capacity and pays approximately one half of the Revenue and Maintenance fees presently received by the City.. Collection Practices; Delinquencies All residential and commercial customer meters are read and billed monthly. The bills become delinquent 20 days after the billing date. At such time a $5.penalty is assessed. Utility service is terminated if payment of all charges and penalties is not received within 55 days from the billing date. Restoration of service requires full payment of all current utility. charges,'penalties and a restoration charge of$20. The customer may also be required to pay an additional deposit to restore service. . Accounts which remain delinquent may be forwarded to authorized collection agencies and deposits may be applied to pay such delinquencies. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] • 31 Accounts receivable and allowance for estimated uncollectible account balances for the past five fiscal years are as follows: Fiscal Accounts Allowance for Estimated Year Receivable Uncollectible Accounts 1996 $802,400 $76,000 1995- 677,327 81,000 1994 651,492 . 79,000 1993 649,308 53,100 1992 310,528 39,500 Source: City of Ocoee, Florida. Regulation The United States Environmental Protection Agency ("EPA") and the Florida Department of Environmental Protection("DEP"), promulgate various regulations governing operation of the System. Regulations deal primarily with the quality of effluent discharged from sewage treatment facilities, the disposal of sludge generated by the sewage treatment plants, the discharge of pollutants into the groundwater and the nature of waste material discharged into the collection facilities. Associated with the regulations are various monitoring and reporting.requirements. . The City's sewage treatment plant is properly permitted and does not have a history of permit violations. The City is not facing any EPA or DEP mandated schedules for elimination of discharges, or any sewage related administrative orders or consent decree decisions. The System currently is in compliance with all state and Federal regulations relating to its wastewater treatment facilities and process and the City does not anticipate that it will have any problems remaining in continued compliance with the DEP use permit.. In addition to regulation of the sewage treatment facilities, EPA and DEP regulate the quality of the System's water. The City presently is in compliance with all applicable regulations relating to water quality. The consumptive use of water is administered by the St. Johns River Water Management District (the "District") through. a consumptive use permitting system, pursuant to which water resources are divided among the permitted consumers. Pursuant to Chapter 373, Florida Statutes, the District issues consumptive use permits for the various wellfields existing within its jurisdiction, including the wellfields that supply water for the System. The provisions of Chapter 373, Florida Statutes, and the regulations promulgated thereunder provide for the issuance of a permit for new uses if the 32 proposed use of water (1) is reasonable and beneficial, (2) will not interfere with any presently existing legal uses of water, and (3) is consistent with the public interest. Presently, all applicable consumptive use permits for the water drawn for the System are in place, as well as the consumptive use permits for the two deep wells currently under construction. Such permits are valid until 2006 and provide the City with an increasing allocation of groundwater supplies. THE PROJECT Introduction In order to meet the future capacity demands on the System through the year 2016, the City has established certain long-range planning procedures. The City commissioned a Water, Sewer and Reuse Master Plan (the "Master Plan") in order to specifically determine the potential future capacity demands on the System through the year 2016. The City has also established a long-range capital improvement plan in the form of the Project pursuant to which certain improvements will be made to the System in order to meet future capacity demands through the year 2016. The Project includes improvements to both the Water System and the Sewer System. The estimated total cost of the Project is $10,813,000, of which$4,973,000 will be used for Water System improvements and $5,840,000 will be used for Sewer System improvements. The cost of the Project will be paid for or financed from the following sources: Existing funds from the City's Renewal and Replacement Account and Water and Sewer Capital Account $ Funds from the separate account in the Debt Service Reserve Fund established for the holders of the Parity Bonds Proceeds of the Series 1997 Bonds Total Sources Capital Improvements to Water System Proposed capital improvements to the Water System emphasize the construction of enhancements to the Forest Oaks and South water treatment plants and the expansion of the 33 water distribution system. The total estimated cost of such improvements is $4,973,000, as. follows: Improvements to Forest Oaks plant $ 553,000 Improvements to South plant 648,000 Enhancements to distribution system . 3,123,000 Engineering/Inspection Fee 649,000 $4,973,000 Capital Improvements to Sewer System Proposed capital improvements to the Sewer System emphasize the need to expand the capacity of the existing effluent disposal system to equal the capacity of the wastewater treatment facility. Pursuant to the Master Plan, an expanded reclaimed water system and the initiation of a reclaimed water retrofit program were identified as a cost effective means of expanding the capacity of the City's effluent disposal system. The retrofit program will provide reclaimed water to existing developments located adjacent to the major reclaimed water transmission mains. The City has also identified the expansion of the effluent disposal system at the Golf.Course as a means of expanding the effluent disposal capacity of the Sewer System. The City proposes purchasing additional undeveloped acreage near.the Golf Course in order to achieve such expansion. The capital improvements plan also identifies the need to construct a modern maintenance facility to provide a centrally located maintenance facility for the System as it is expanded. The total estimated cost of the expansion of the effluent disposal system is $5,840,000, as follows: Reclaimed Water Program $2,790,000 Retrofit Program 1,050,000 Effluent Disposal Expansion 1,500,000 Maintenance Facility 500,000. $5,840,000 SUMMARY OF CONSULTING ENGINEER'S CONCLUSIONS Professional Engineering Consultants, Inc. are the Consulting Engineers for the City with respect to the System. Based on its general familiarity with and review of the System as indicated in the Consulting Engineer's Report attached hereto as Appendix B, which Report should be read in its entirety in conjunction with the following, the Consulting Engineers have concluded that: 34 1. The System is in good condition and has been operated and maintained in accordance with standard utility industry practices, and provides good, reliable and cost-effective water and sewer service to the customers of the System. 2. The System is operated in compliance with current Federal, State and local regulatory requirements. All regulatory permits necessary for the operation of the System are current (renewal in progress) and in good standing. 3. The Project is necessary and provides water and sewer service for new growth. The average annual growth rate of 350 ERUs is reasonable and valid during the 20-year planning period. The Project is technically sound and conforms to proven and industry accepted engineering practice. The Project will provide for water and sewer system improvements and expansion which will meet Federal, State and local regulatory requirements and projected growth-related water and sewer demands for a 20-year period. 4. The proposed Project is or shall be designed in accordance with accepted engineering standards using proven conventional technology. The proposed improvements have or shall be, designed with a high level of sensitivity to concerns held by nearby residents regarding aesthetic issues such as odor control, noise, lighting and utility. 5. The City's management and professional staff are well qualified and certified to manage, operate and maintain the System. 6. It is reasonable to assume that all required regulatory permits and/or governmental approvals shall be obtained in a timely manner for regulatory compliance and will be obtained prior to construction of the proposed Project and subsequently all necessary operating permits will be obtained for the completed capital improvements. 7. No material charges have occurred in the Project which will have,a negative impact on the cost estimate for successful completion of the Project. 8. Proceeds from the Series 1997 Bonds will be sufficient for design, construction and implementation of the Project as described in the Report. 9. The useful life of the Project is in excess of the weighted life of the Series 1997 Bonds. 10. The adopted water and sewer rates are reasonable and sufficient to meet projected system operating expenses, estimate project cost recovery, debt service coverage for Series 1997 Bonds and renewal and replacement contributions. 35. 11. Based on the analysis and evaluation contained in'the Report; the capital financing of the City's proposed Project is economically feasible. HISTORICAL AND PROJECTED SCHEDULE OF NET REVENUES AND DEBT SERVICE COVERAGE The information in the following table sets forth-the historical and projected Net Revenues of the System and debt service coverage, The historical data has been developed from data contained in the audited financial statements of the City for the fiscal years ended September 30, 1994, 1995.and 1996,respectively: The projected revenues and'expenditures for the fiscal years ending September 30, 1997, 1998, 1999, 2000 and 2001, respectively, were determined and provided by the City's Consulting Engineers. • [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] • 36. WATER AND SEWER SYSTEM HISTORICAL AND PROJECTED STATEMENT OF NET REVENUES OF THE SYSTEMS • FOR YEARS ENDED SEPTEMBER 30, 1994-2001 CITY OF OCOEE, FLORIDA Actual-Audited • Projected 1994 1995 1996 1997 1998 r. 1999 2000 2001 Operating Revenues(1) • Water Charges (2) $1,283,905 $1,741,711 $1,909,585 $1,925,290 $1,968,985 $2,004,029 $2,037,395 $2,071,761 Sewer Charges 1,610 972 1,775,997 1,875 421 2,055 399 2,158,106 2,239,450 2,318,794 2,399,138 Non-Operating Revenue 68,289. . 387,437 428,158 . 40,000 40,000 •.. 40,000• .40,000 40,000 • Gross Revenue $2,963,166 $3,905,145 $4,213,164 $4,020,689 $4,167,091 $4,283,479. $4,396,189 4,510,899 Less: Operation and Maintenance Expense (Excluding Depreciation) $1,869,359 $1,914,065 $2,134,380 $2,572,880 $2,677,481 $2,784,580 $2,894,140 . $3,009,906 • Net Revenue Available for . • Debt Service $1,093,807 $1,991,080. $2,078,784 $1,447,809 $1,489,610 , $1,498,899 $1,502;049. $1,500,993 Impact Fees (3) $649,875 $649,875 • $649,875 $649,875 $649,875 $649,875 $649,875 $649,875 Annual Debt Service Series 1997 Bond's (4) $0 $0 . $0 $700,000 $700,000 $700,000 $700,000 $700,000 Parity Bonds 649,875 649,875 . 649,875 649,875. 649,875 : 649,875 • 649,875 649,875 Debt Service Coverage-Net - Revenues Only 1.68x 3.06x 3.20x 1.07x. 1.10x . 1.1 lx •. 1.1 lx . : 1.l lx Debt Service Coverage -Net Revenues and Impact Fees 2.68x • 4.06x , 4.20x 1.55x 1.59x • 1.59x • 1.59x 1.59x (1) Operating Revenues does not include any revenues from the provision of reclaimed water services. (2) Operating Revenues From Water Charges is shown net of Utility Tax. . • (3) - Constitutes Sewer-System Development Charges Bond Service Component and Water System Development Charges Bond Service Component. (4) Assumed interest rate of 5.65%. . Sources: City of Ocoee Annual Financial Report for the.years ended September 30, 1994,.1995 and 1996, respectively; September 30, 1997-2001 figures are based on projections by the City's Consulting Engineers, PEC/Professional Engineering Consultants, Inc. LITIGATION There is not now pending any litigation restraining or enjoining the issuance or delivery of the Series 1997 Bonds or the pledge of the Pledged Funds or questioning or affecting the validity of the Series 1997 Bonds or the pledge of the Pledged Funds or the proceedings,and authority under which they are to be issued and the Pledged Funds are pledged. Neither the creation, organization or existence of the City, nor the title of the present Mayor or commissioners or other officials of the City to their respective offices is being contested. The City experiences routine litigation and claims incidental to the conduct of its affairs and the operating of the System. The City carries substantial insurance for these exposures, and pending claims are defended by and; if necessary, are anticipated to be paid by the insurance carriers. There is no cause either pending or, to the best knowledge of the City, threatened against the City which may materially adversely affect the ability of the City to pay the Series 1997 Bonds or adversely affect the general financial condition of the City. LEGAL MATTERS Certain legal- matters incident to the validity of .the Series 1997 Bonds and the. issuance thereof by the City are subject to the approval.of Bryant, Miller and Olive, P.A., Tampa, Florida, Bond Counsel, whose approving opinion will be printed on the Series 1997 Bonds. Certain legal matters will be passed upon for the City by Foley & Lardner, Orlando, Florida, City Attorney. Certain legal matters will be passed upon for the Underwriter by its - counsel, Nabors, Giblin&Nickerson, P.A., Tampa, Florida. TAX EXEMPTION General The Internal Revenue Code of 1986, as amended, establishes certain requirements which must be met subsequent to the issuance and delivery of the Series 1997 Bonds in order that interest on the Series 1997 Bonds be and remain excluded from gross income for purposes of Federal income taxation. Non-compliance may cause interest on the Series 1997 'Bonds to be included in,Federal gross income retroactive to the date of issuance of the Series 1997 Bonds, regardless of the date on which such non-compliance occurs or is ascertained. These requirements include, but are not limited to, provisions which prescribe yield and other limits'within which the proceeds of the Series 1997 Bonds and the other amounts are to be invested and require that certain investment earnings on the foregoing must be rebated 38 • on a periodic basis to the Treasury Department of.the United States. . The City has covenanted in the Resolution to comply with such requirements in order to maintain_ the exclusion from Federal gross income of the interest on the.Series 1997 Bonds:. In the opinion of.Bond Counsel, assuming compliance with the aforementioned . . covenants; under existing laws, regulations, judicial decisions and rulings; interest on the Series 1997 Bonds is excluded from gross income for purposes of Federal income.taxation. Interest on the Series.1997 Bonds is not an item of tax preference for purposes of the Federal alternative minimum tax imposed on individuals or corporations; however; interest on the Series 1997 Bonds may be subject to the alternative.minimum tax when any Series 1997 Bond is held by a corporation. The alternative minimum taxable income of a corporation must be increased by 75%of the excess of such corporation's adjusted current earnings over its alternative minimum taxable income,(before this adjustment and the alternative tax net operating loss deduction). "Adjusted current earnings" will include interest on the Series 1997 Bonds. The Series 1997:Bonds are exempt from all present:intangible personal property taxes imposed pursuant to Chapter 199, Florida Statutes. - .. Except as.described above,-Bond Counsel will express no opinion regarding the Federal income tax consequences resulting-from:the ownership of, receipt or accrual.of interest on, or disposition of Series 1997 Bonds. Prospective purchasers of Series 1997 Bonds'should be aware that the ownership of Series.199.7 Bonds may result in collateral Federal.income_tax consequences,including (1) the denial of a deduction for interest on indebtedness incurred or continued to purchase or carry Series 1997 Bonds, (2) the reduction of the loss reserve• deduction for property_and:casualty insurance companies by 15% of certain items, including interest on the Seriess:1997 Bonds, (3) for taxable years beginning before January:.1, 1996, the inclusion of interest on Series 1997. Bonds in,"modified alternative minimum taxable income" for purposes of the environmental tax impose&on corporations,(4).the inclusion of interest on the Series 1997 Bonds in earnings of certain foreign corporations doing business in the United States for purposes of'a branch profits tax, (5) the inclusion.of interest on Series 1997 Bonds in passive income subject to Federal income taxation of certain Subchapter S corporations with Subchapter:C earnings and profits at the close of the taxable year,and(6) the inclusion of interest on the Series 1997 Bonds in "modified adjusted gross income" by recipients of certain Social Security and Railroad Retirement benefits for purposes of determining whether such benefits are included in gross income for Federal income tax purposes. . PURCHASE, OWNERSHIP, SALE. OR DISPOSITION OF THE SERIES 1997 BONDS AND,;THE'RECEIPT OR.ACCRUAL OF THE INTEREST :THEREON MAY HAVE-ADVERSE FEDERAL TAX CONSEQUENCES FOR CERTAIN INDIVIDUAL AND-CORPORATE BONDHOLDERS.: PROSPECTIVE BONDHOLDERS SHOULD 'CONSULT WITH THEIR TAX SPECIALISTS:FOR INFORMATION IN THAT REGARD. 39 During recent years legislative proposals have been introduced in Congress, and in some cases enacted, that altered certain Federal tax consequences resulting from the ownership of obligations that are similar to the Series 1997 Bonds. In some cases these proposals have contained provisions that altered these consequences on a retroactive basis. Such alteration of Federal tax consequences may have affected the market value of obligations similar to the Series 1997 Bonds. From time to time,.legislative proposals are pending which could have an effect on both the Federal tax consequences resulting from ownership-of Series 1997 Bonds and their market value. No assurance can be given that legislative proposals will not be introduced or enacted that would or might apply to, or have an adverse effect upon, the Series 1997 Bonds. Tax Treatment of Original Issue Discount Under the Code, the difference between the maturity amounts of the Series 1997 Bonds maturing in the years through , inclusive, and in the year 'and the initial offering price to the public, excluding bond houses, brokers or similar persons or organizations acting in the capacity of underwriters or wholesalers, at which price a substantial amount of Series 1997 Bonds of the same maturity was sold is "original issue discount." Original issue discount will accrue over the term of such Series 1997 Bonds at a constant interest rate compounded periodically. A purchaser who acquires such Series 1997 Bonds in the initial offering at a price equal to the initial offering price thereof to the public will be treated as receiving an amount of interest excludable from gross income for federal income tax purposes equal to the original issue discount accruing during the period he holds such Series 1997 Bonds, and will increase his adjusted basis in such Series 1997 Bonds by the amount of such accruing discount for purposes of determining taxable gain or loss on the sale or other disposition of such Series 1997 Bonds. The Federal income tax consequences of the purchase, ownership and sale or other disposition of Series 1997 Bonds which are not purchased in the initial offering at the initial offering price may be determined according to rules which differ from those above. Owners of such Series 1997 Bonds should consult their own tax advisors with respect to the precise determination for Federal income tax purposes of interest accrued upon sale or other disposition of Series 1997 Bonds and with respect to the state and local tax consequences of owning and disposing of Series 1997 Bonds. UNDERWRITING William R. Hough & Co. (the "Underwriter") has agreed, subject to certain conditions, to purchase the Series 1997 Bonds from the City at an aggregate discount of $ , from the initial public offering prices set forth on the cover page of this Official Statement. The initial public offering prices set forth on the cover page of this 40 • Official Statement include aggregate original issue discount of $' . The Underwriter's obligation is Subject to certain conditions precedent, and they Will be obligated to purchase all of the Series 1997 Bonds if any Series-1997 Bonds are purchased. The Series 1997 Bonds may be offered and sold to certain dealers (including dealers depositing such - Series. 1997 Bonds into investment trusts) at prices lower than the public 'offering prices stated on the Cover page hereof, and such public;offering prices may be changed from time to time by the Underwriter. CONTINUING DISCLOSURE The City has covenanted for the benefit of Series 1997 Bondholders to provide certain financial information and operating data relating to the City and the Series 1997 Bonds in each year (the "Annual Report"), and to provide notices of the occurrence of certain enumerated material events. Such.covenant shall only apply so long as the Series '1997 Bonds remain outstanding under the Resolution_ The covenant shall also cease upon the termination of the continuing disclosure requirements. of S.E.C.. Rule 15c2=12(b)(5) (the "Rule")by legislative,judicial or administration action. The Annual Report will be filed by the City with each Nationally Recognized Municipal Securities Information Repository (the • "NRMSIRs") described in the Form of the Continuing Disclosure Certificate attached hereto as Appendix F, as well as any state information depository that is subsequently established in the State of Florida(the"SID"). The notices of material events will be filed by the City with the NRMSIRs or the Municipal Securities.Rulemalcing Board, and with the SID. The ' specific nature of the information to be contained,in the Annual Report and the notices of material events are described in "APPENDIX F-FORM OF CONTINTANGDISCLOSURE CERTIFICATE," which shall be executed by the City at the time of issuance of the Series 1997. Bonds. These covenants have been made in order to assist the Underwriter in complying with the Rule. With respect to the Series 1997 Bonds, no.party other than the City is obligated to provide; nor is.expected to provide,:any continuing disclosure information with respect to the aforementioned Rule. RATINGS It is anticipated that Moody's Investors Service;Inc:, Standard&'Door's Ratings Group and Fitch Investors Service, L.P. shall assign municipal bond ratings of"Aaa," "AAA" and "AAA," respectively, to this issue of Series 1997 Bonds with the understanding that upon delivery of the Series 1997 Bonds; a policy insuring the timely payment of the principal of and interest on the Series 1997 Bonds will be issued by AMBAC Indemnity_ In addition, - 41 . Standard & Poor's Ratings Group is expected to assign an underlying rating of"A-" to the Series 1997 Bonds_ Such ratings reflect only the views of the rating agencies, and an explanation of the significance of such ratings may be obtained from the applicable rating agency. There is no assurance that such ratings will continue for any given period of time or that they will not be revised or withdrawn entirely by such rating agencies, if in their judgment, circumstances so wan-ant. Any downward revision or withdrawal of such ratings may have an adverse effect upon the market price of the Series 1997 Bonds. FINANCIAL STATEMENTS The Water and Wastewater Fund Financial Statements for the fiscal year ended September 30, 1996 of the City of Ocoee, Florida, appearing in Appendix C to this Official Statement have been audited by McDirmit, Davis, Lauteria & Company, P.A., independent accountants, as set forth in their report dated November 6, 1996, which report also appears in Appendix C hereto_ FINANCIAL ADVISOR The City has retained First Union Capital Markets Corp. ("First Union"), Orlando, Florida, as financial advisor with respect to the issuance of the Series 1997 Bonds. First Union is not obligated to undertake and has not undertaken to make an independent verification or to assume responsibility for the accuracy, completeness, or fairness of the information contained in the Official Statement. DISCLOSURE REQUIRED BY FLORIDA BLUE SKY REGULATIONS Florida law requires the City to make a full and fair disclosure of any bonds or other obligations which it has issued or guaranteed and which are or have been in default as to principal or interest at any time after December 31, 1975 (including bonds or other debt obligations far which it has served as a conduit issuer). The City is not and has not been in default as to principal and interest on nonconduit bonds or other debt obligations which it has issued or guaranteed_ The City has not served as a conduit issuer for bonds or other debt obligations. 42 ENFORCEABILITY OF REMEDIES The remedies available to the owners of the Series 1997 Bonds upon an event of default under the Resolution and any policy of insurance referred to herein are in many respects dependent upon judicial actions which are often subject to discretion and delay. Under existing constitutional and statutory law and judicial decisions, including specifically the federal bankruptcy code, the remedies specified by the Resolution, the Series 1997 Bonds and any policy of insurance referred to herein may not be readily available or may be limited. The various legal opinions to be delivered concurrently with the delivery of the Series 1997 Bonds (including Bond Counsel's approving opinion) will be qualified, as to the enforceability of the remedies provided in the various legal instruments, by limitations imposed by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors enacted before or after such delivery. MISCELLANEOUS Any statements made in this Official Statement involving matters of opinion or of estimates, whether or not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that any of the estimates will be realized. Neither this Official Statement nor any statement that may have been made verbally or in writing is to be construed as a contract with the owners of the Series 1997 Bonds. The information contained above is neither guaranteed as to accuracy or completeness nor to be construed as a representation by the City or the Underwriter. The information and expressions of opinion herein are subject to change without notice and neither the delivery of this Official Statement nor any sale made hereunder is to create, under any circumstances, any implication that there has been no change in the affairs of the City from the date hereof. This Official Statement is submitted in connection with the sale of the securities referred to herein and may not be reproduced or used, as a whole or in part, for any other purpose. Any statements in this Official Statement involving matters of opinion, whether or not expressly so stated are intended as such and not as representations of fact. This Official Statement is not to be construed as a contract or agreement between the City and the purchasers or the Holders of any of the Series 1997 Bonds. CERTIFICATE AS TO OFFICIAL STATEMENT The execution and delivery of this Official Statement has been duly authorized by the City Commission of the City. At the time of delivery of the Series 1997 Bonds to the 43 Underwriter, the City will provide to the.Underwriter a certificate (which may be included in a consolidated closing certificate of the City), signed by those City officials who signed this Official Statement, relating to the accuracy and completeness of certain materials in this Official Statement and to its being a "final official statement" in the judgment of the City Commission for the purpose of SEC Rule 15c2-12(b)(3). CITY OF OCOEE, FLORIDA By: Mayor • • 44 APPENDIX A GENERAL INFORMATION CONCERNING THE CITY OF OCOEE AND ORANGE COUNTY, FLORIDA [This page intentionally left blank] APPENDIX A GENERAL INFORMATION CONCERNING THE CITY OF OCOEE AND ORANGE COUNTY, FLORIDA THE FOLLOWING INFORMATION CONCERNING THE CITY OF OCOEE, FLORIDA, ORANGE COUNTY, FLORIDA AND THE ORLANDO METROPOLITAN STATISTICAL AREA IS INCLUDED ONLY FOR THE PURPOSE OF PROVIDING GENERAL BACKGROUND INFORMATION. THE INFORMATION HAS BEEN COMPILED ON BEHALF OF THE CITY AND SUCH COMPILATION INVOLVED ORAL AND WRITTEN COMMUNICATION WITH THE VARIOUS SOURCES INDICATED. THE INFORMATION IS SUBJECT TO CHANGE, ALTHOUGH EFFORTS HAVE BEEN MADE TO UPDATE THE INFORMATION WHERE PRACTICABLE. THE SERIES 1997 BONDS ARE NOT GENERAL OBLIGATIONS OF THE STATE OF FLORIDA OR ANY POLITICAL SUBDIVISION THEREOF, INCLUDING THE CITY OF OCOEE. General Description and Location The City of Ocoee, Florida(the "City")is a residential community in the western part of Orange County, Florida (the "County") and was incorporated in 1925. It is bounded on the west by Winter Garden, and on the south by Windermere, and has a land area of approximately 20 square miles, thus making it the second largest city in land area of the thirteen cities in Orange County. State Roads 50, 437 and 438 are major roads providing easy access to City residents. The Florida Turnpike, the East-West Expressway and State Road 50 all pass through the City limits. The planned Western Beltway will also be accessible within the City limits. As of April 1, 1996, the population of the City was estimated at 19,261. The City ranks third in population of the cities in Orange County. The average household income, as estimated by the West Orange Chamber of Commerce for West Orange County, is $47,900 and the median age of an Orange County resident is 32.5 years of age. A-1 Population The following table sets forth historical and projected population trends in the City of Ocoee, Orange County, and the State of Florida from years 1960 through 2010: City of Ocoee Orange County State of Florida Year Population Change Population Change Population Change 1995 18,578 45.4% 758,962 12.0% 14,149,317 9.4% 1990 12,778 63.8 677,491 43.9 12,938,071 32.7 1980 7,803 98.2 470,865 36.8 9,746,424 43.5 1970 3,937 57.5 344,311 30.6 6,791,418 37.2 1960 2,500 -- 263,540 -- 4,951,560 -- Projected 2010 34,835 70.2 928,562 19.9 16,761,774 15.3 2000 . 22,357 63.2 842,660 29.1 15,527,384 20.5 Source: U.S. Census Bureau; Population Studies Population Program, Bureau of Economic and Business Research, University of Florida; City of Ocoee. Government The City is governed by a Commission-Manager form of government. The four City Commissioners and the Mayor are elected on staggered two-year terms of office, who in turn appoint the City Manager. Listed below are the current Mayor and City Commissioners and their respective term expiration dates: Members Term Expires S. Scott Vandergrift, Mayor February 1997 Leon "Rusty" Johnson, Commissioner February 1997 Jim Gleason, Commissioner February 1998 Scott A. Glass, Commissioner February 1997 Scott Anderson, Commissioner February 1998 Police and Fire Protection Approximately 53 law enforcement personnel and 35 fire protection personnel provide 24-hour police and fire protection. A-2 Recreation The City has ten parks and an 18-hole public golf course. Major public recreational facilities include tennis courts, outdoor basketball courts, a football field, baseball fields and a BMX course, as well as several picnic areas, playground equipment, walking trails and boat launching facilities. A new multi-purpose recreational complex is in the planning stages to include a full-size gymnasium, soccer and baseball/softball fields, a municipal swimming pool and nature trails. The City has an active summer recreation program for children and many other organized sporting and leisure activities for all its citizenry. Budget Preparation Pursuant to Florida law, on July 1, the Property Appraiser of Orange County certifies the tax roll. On July 31, the City submits to the.Property Appraiser the proposed millage as well as the date, time, and place of the first public hearing. The first public hearing on the budget is held_ by mid-September, at which time the City Commission reviews the recommended budget, making adjustments as it deems appropriate. By September 30, the budget is adopted by ordinance, and the millage rate and other revenues are set to fund the operating budget. . .. Employee's Defined Pension Plan and Trust The City contributes to a defined benefit pension plan and trust. 'As of September 30, 1995, the plan was amended by separating the program into separate plans for general employees, police officers and firefighters. The assets were allocated as follows: General Employees $1,228,539 Police Officers and Firefighters $1,384,589 City Employees are required to contribute. 5% of salary to the plan. The normal retirement benefit is 2% of average final compensation for each year of credited services. The normal retirement age is 60. Average compensation is based on the highest five (5) years of last ten (10) years of service. Benefits fully vest on reaching five (5) years of service. The plan provides death but not disability benefits. These benefit provisions and all other requirements are established by City ordinance. A-3 ECONOMIC SUMMARY Employment Prior to 1967, the Orlando Metropolitan Statistical Area-("MSA") economy was based upon agricultural and citrus products, tourism, light manufacturing and industries relating to the space program at the Kennedy Space Center at Cape Canaveral. Since 1967, construction of Walt Disney World, EPCOT Center, Disney-MGM Studios, Sea World, Universal Studios Florida and other tourist attractions, together with increasing convention activity, have played an important part in the local economy. This has resulted in a larger percentage of total employment in the Orlando MSA consisting of trade and service jobs as compared to the national average. Orange County-Labor Force Estimates 1990-1996 ' Civilian Unemployment Rate Calendar Labor Orange State of United Year Force Employed Unemployed County Florida States 1996* 437,031 420,210 16,821 3.8 5.3 5.5 1995 443,472 422,602 ' 20,870 4.7 5.5 5.2 1994 426,155 . 401,471 24,684 5.8 6.6 6.1 1993 410,216 384,758 25,458 6.2 ., 7.0 6.8 1992 398,327:. 368,940 29,387 • 7.4 8.2 7.4 • *Preliminary figures as of June 1996. Sources: 1990-1994: Florida Statistical Abstracts; 1995-1996: Florida Department of Labor and Employment Security,Division of Labor, Employment and Training, Local Area Unemployment Statistics by County. • A-4 Largest Employers in Orlando MSA Area 1996 Name of Employer # of Employees 1. Walt Disney World Co. 36,000 2. Orange County Public Schools 23,000 3. Publix Supermarkets, Inc. 10,480 4. Florida Hospital 8,523 5. Orlando Regional Healthcare System 7,131 6. Lockheed Martin .6,277 7. AT&T Information Systems 6,000 8. Seminole County Public Schools 5,733 9. Orange County Government 5,400 10. Winn Dixie Stores 5,374 Source: Economic Development Commission of Mid-Florida, Inc. Largest Employers in the City of Ocoee, Florida 1996 Name of Employer # of Employees 1. Health Central 529 2. Sysco Foods, Inc. 500 3. Florida Auto Auction 426 4. Publix Supermarkets, Inc. 325 5. Dillard's 305 6. Gayfer's 283 7. Sears 232 8. JCPenney's 190 9. Winn Dixie Stores 180 10. Wal-Mart 170 Source: City of Ocoee, Florida. In the City there are several major employers, including the Florida Auto Auction, Wal-Mart, the Holiday Inn, Certi-Fine Fruit Company, Inc., the Colony Plaza Hotel, Amber Electric, Sysco Foods, Inc., a large food distributorship, and Whitaker Oil Company, a chemical concern. The City's industrial base is diverse, ranging from stained glass artistry to casket and burial vault production. A-5 Personal Income Per Capita • 1990-1994 Year Orange County State of Florida United States 1994 N/A $21,677 $21,809 1993 19,570 20,650. 20,800 1992 . 18,861 19,664 20,137 1991 . 18,154 19,180 19,163 1990 17,916 18;692,: . 18,696 Source: 1990-1993: 1995 Florida Statistical Abstract,.1994: City of Ocoee,.Florida. Effective Buying Income January 1, 1996 Orange County State of Florida United States Average Household EBI . $42,195 .. $39,205 $40,598 Median Household EBI 33,433 29,664 32;238. Per Capita EBI 15,910 15,495 14,965 Under 15,000 17.6% 22.6% 21.7% 15,000 - 24,999 . . 17.8 19.1 17.0 25,000 - 49,999 36.6 ' 34.0 . ' •' 33.8 50,000 - 74,999. 18.0 15.1. 17.6 75,000 and above ' ' '10.0 9.2 •. 9.9 Source: Market Statistics, 1996 Demographics USA - County Edition. Education . The Orlando area has four major institutions of higher learning:. University of Central - Florida (a four-year state university with an enrollment of more than 26,000 full and part- time students);.Rollins College (the oldest four-year institution of higher learning in Florida; an independent,coeducational, liberal arts college with an enrollment of more than.1,400 daytime students and 3,000 total students); Seminole Community College (a two-year undergraduate institution with approximately 30,000.students annually); and Valencia Community College (the fourth'largest of Florida's 28 :community :colleges,, a two-year undergraduate institution 'covering six campuses with over 60,000. full and part-time students). A-6, Public School enrollment for the 1995-1996 school year in Orange County was 270,899. Source: Economic Development Commission of Mid-Florida, Inc., 1996 Opportunity Orlando. Transportation 1 . . The Orlando MSA is primarily served by Orlando International Airport ("OIA"), which is the 18th busiest.domestic airport facility and the 27th busiest world airport facility. OIA is the eighth largest port of.entry for international visitors to the continental United States, .accommodating_more than 2.5.:million passengers on international flights from Europe, .Mexico, Canada; the Caribbean and Central and South America.; Air passengers have increased from.18.4 million in 1991 to 22-million in 1994: OIA is.the second largest airport in the country in terms of property size, ensuring room for continued expansion well into the next century. Thirty-one scheduled carriers serve OIA with 1,050 departures and arrivals daily, including direct and international flights. More than 100 U.S. and international cities are served by_direct and nonstop flights from OIA, the most of'any airport in Florida. In addition to scheduled airlines, more than 30 scheduled charter companies serve the Orlando MSA. .. .The Orlando MSA is also served, by three .general aviation airports: Orlando Executive Airport, Orlando Sanford Airport-and Kissimmee Municipal Airport. The Orlando MSA is also served by 35 common-carrier truck lines, most of which have local terminals and several parcel delivery and package express services covering Orange County and neighboring communities. Greyhound, Gray Line, Superior and Trailways Bus.Lines offer charter, express and passenger services. Both passenger and freight rail systems provide service to the area. Amtrak currently operates two trains daily between New York.and South Florida which travel through Metro Orlando. Amtrak stops at four stations in the area:Sanford, Winter Park, Orlando and Kissimmee. Rail passenger stations in the area are among the busiest in the southeast, with approximately 400 Amtrak passengers arriving and departing daily.' CSX Transportation moves freight between north and south Atlantic points and connects with all major rail lines in the United States. Three major limited-access highways bisect the area: (1) Interstate 4 runs east and west across Florida from Daytona Beach and Interstate 95 on the Atlantic coast of Florida to Tampa and Interstate 75 near the Gulf coast of Florida; (2) Florida's.Turnpike runs north and south from Interstate 75 near Ocala, Florida.to Miami; and (3),Interstate 75, which extends through Georgia and the midwestern part of the United States. Other highways • A-7'. serving the area include U.S. Highways 441; 17-92, 27 and 192, as well as numerous state roadways and toll roads. The Bee Line Expressway(State Road 528) provides direct limited access to Kennedy Space Center, Port Canaveral and the beaches along the Atlantic coast of Florida. The East-West Expressway (State Road 408) expedites traffic through the metropolitan Orlando and is connected by full interchanges with Interstate 4 and with Florida's Turnpike. To address road transportation needs, four mid-Florida county governments have combined efforts to construct a 100-mile, limited-access beltway encircling metropolitan Orlando called the Central Florida Greeneway (the "GreeneWay"). More than half of the. GreeneWay is in use. Most recently, portions were completed to Aloma Avenue and U.S. Highway 17-92 and from the Bee Line just east of Orlando International Airport to near State Road 536 in Osceola County's busy Disney area. The GreeneWay extension to I-4 west of U.S. Highway 192 is under construction and is slated for completion by the end of 1996. Other portions of the GreeneWay, including those in the western section of the region, are being planned. Public transportation is provided by 204 Lynx buses, run by the nationally recognized transportation system serving Orange, Seminole and Osceola Counties. Included in its regularly served 47 routes are stops at shopping centers, government complexes, schools, financial institutions, industrial and commercial centers and tourist.attractions. The FreeBee, a no-cost bus service for those getting around in downtown Orlando, is also available. Another transit route circulating downtown begins construction this year. Source: Economic Development Commission of Mid-Florida, Inc., 1996 Opportunity Orlando and the City of Ocoee, Florida. Levy of Taxes Each year the County Property Appraiser Is required to certify to each taxing authority; the aggregate taxable value of all property within the jurisdiction of the taxing authority, as well as the prior year's tax revenues,.for use in connection with determination of the forthcoming budget and millage levy. In connection with such determination, the taxing authority must hold a public hearing in connection with the adoption of a tentative budget and millage levy and another hearing relating to adoption of the final budget and millage levy. A-8 :City.of Ocoee, Florida Property Tax:Rates and Tax Levies Direct and Overlapping Governments 1993-1997 Millage Rates (per $1,000 of taxable value) Fiscal City of Orange School Year : ' ' Ocoee . County Board :• - -Total 1997 4.00 5.2889. 9.177 18.4650 1996 4.00 . 5.2889 " 9.375 18.6630 1995 4.00 5.2889. .. 9.324 18.6129 1994 : 4.00 5.2889 .. 8.930 : 18.2189 1993 4.00 5.2889 . 8.930 " 18.2189 Taxes Levied and Collected : City.of Ocoee, Florida 1993-1997 Taxable- Total % of Total Fiscal Assessed Tax Total Tax. Collections Year Valuation _ Levy Collections Delinquent to Levy 1997 546,637;911. 2,326,642 N/A N/A 1996 . 505,656,888 ' 2,022;628 2,173,162 : 2,247 1995 . 469,310,003 1;877;240- 1,803,405 -- 96.07 1994 424,437,664 1;697,751: 1,647,742 1,753 . 97.05 1993 375,807,867 1,503,231 1,455;968 4,941 96.86 Source: 1993-1995: Comprehensive Annual Financial Report of the City of Ocoee, -Florida for the Fiscal Year Ended September 30, 1995; 1996-1997: City of Ocoee, Florida. A-9 City of..Ocoee-,:Florida :Schedule of.Ten:-Largest Taxpayers September>30, 1996 :: ... Taxpayer r Type of Business Valuation Percentage • 1.. GGP/Homart Inc:' West Oaks Mall $15,489,250 . 3.0% 2. Oak Forest Partners, Ltd; Developer • $:9,600,006 ' 1.9 3.. Manhein Remarketing,:L.P : Developer : :.9;405,293 1.8 4. Good Homes Plaza Shopping Center 9,302;171 1.8 - 5 Towne Square Associates , Shopping:Center 6,585,168- 1.3 6. West Orange Health Care - Districts Health Care 6,383;453 1.2 : . 7. West Lake Partners, Ltd: Developer 6;151,569 1:2 8. Lake.Olympia Square r,Shopping Center - 5;306,914 1.0 Partnership 9: Sysco Corporation Food Distribution 5,051,752 . 1.0 10: Teachers Insurance & Annuity :Investments: :.:: 4:375.720 0.9 Total Taxable Assessed Value of 10 Largest Taxpayers 77,651,296 15.1 Total.-Taxable Assessed Value:of ): Other Taxpayers;;: .' 429,854;454 : 84.9 Total Taxable Value of All Taxpayers $507;505;750 100.0% Note: The West Oaks Mall, .which'on October 2; 1996, has an expected'taxable r. valuation at build-outof approximately $138.million: Source: , Comprehensive Annual Financial Report of the City of Ocoee, Florida for the Fiscal Year Ended September 30; 1995. A-10 City of Ocoee, Florida Construction Property Value and Bank Deposits 1992-1996 Residential Construction(') Bank Deposits(2) Number of Units (in thousands) Single- Multi- Property Savings Year Family Family Value Banks & Loans 1996 366 0 33,871,752 6,937,918 859,921 1995 331 0 28,836,036 6,147,414 828,351 1994 402 0 35,211,374 5,874,598 1,078,501 1993 411 0 36,188,257 5,743,997 1,133,135 1992 438 0 36,622,069 5,614,174 2,936,546 (1) Source: City of Ocoee Building Department (2) Source: Florida Bankers Association. 1992-1995 figures represent deposits for Orange County as of September 30 of such year; 1996 figures represent deposits as of June 30, 1996. A-11 City of Ocoee; Florida Debt Statement September 30; 1996 General_ . . _. .N.on;Self_ Self- Obligation :Supporting Supporting Direct City Debt Debt • . Debt Debt Capital Improvement Revenue Bonds, Series. 1991 due 10/1/2011. $2,205,000 Transportation Refunding"and: " Improvement Revenue Bonds, Series 1990 due 10/1/2015. 6,215,000 Stormwater Utility Bonds, Series 1996:.. _$`2;200,000 Water.and Sewer System.Refunding _ - and Improvement Bonds, Series_ 1993 due 10/1/2017 :7,850,000 Total Direct Debt :$ - -0 $8,420,000 $10,050,000 Overlapping Debt- Orange County Library District Library Refunding :Bonds, Series 1993 $10,045,000 Total Overlapping Debt $10;045,000 % City's Share of Overlapping Debt 1.43% E - City's Share of Overlapping Debt $ 143,643 Total Direct and Overlapping Debt $ 143,643 $8,420,000 $10,050,000 Note: The City is in the process of securing a$4.4 million (15-year)loan secured by non-ad valorem revenues. Sources: City of Ocoee and Orange County,-Florida. A-12 City of Ocoee, Florida Comparative Ratios of Bonded Debt September 30, 1996 1. 1996 Population 19,261 2. 1996 Total Assessed Valuation $581,660,537 3. 1996 Taxable Assessed Valuation $546,637,911 4. Direct and Overlapping General Obligation Debt Per Capita $7.46 5. Direct and Overlapping General Obligation Debt and Self-Supporting Debt Per capita $529.24 As a percent of total assessed valuation 1.75% As a percent of taxable assessed valuation 1.86% 6. Direct and Overlapping General Obligation Debt and Non-Self Supporting Revenue Debt Per capita $444.61 As a percent of total assessed valuation 1.47% As a percent of taxable assessed valuation 1.57% Source: City of Ocoee, Florida. A-13 APPENDIX B ENGINEERING REPORT OF PROFESSIONAL ENGINEERING CONSULTANTS, INC. 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I , . • UTILITY SYSTEMS MAP ---,-:— • : , • LEGEND _,j . •., - - •• 1=-_--,_ -.L_.__.-__ _.-..i:_-__•47i ._ _. • ' .• .NAM,la.W1S • FORCE WARS .• SANITARY SEWERS I. -- , . . .. MUIR NO WASTEWATER ---- -.SERA MCA . k . . UTILITY SYSTEM MAP FIGURE 1 .1 PEC . . • • , • • • • • . . . . . . . • ,. . . TABLE OF CONTENTS SECTION TITLE PAGE NO. 1 INTRODUCTION 1 1.1 Purpose and Scope 1 1.2 Background 1 1.3 Authorization 2 2 DESCRIPTION OF EXISTING WATER AND SEWER SYSTEM 3 2.1 Service Area 3 2.2 Existing Water System 3 2.2.1 Jamela Water Treatment Plant 6 2.2.2 Forest Oaks Water Treatment Plant 6 2.2.3 South Water Treatment Plant 7 2.3 Potable Water Distribution System 7 2.4 Existing Wastewater Facilities 12 2.5 Existing Wastewater Transmission Facilities 14 2.6 Existing Reclaimed Water Facilities and Transmission System 16 2.7 Wastewater System Growth Restrictions 16 2.8 Capital Improvement Program (CIP) 16 3 WATER AND SEWER FLOW PROJECTIONS 18 3.1 Overview 18 3.2 Future Potable Water System and Transmission Facilities 19 3.3 Future Wastewater Facilities 22 _ 3.4 Future Wastewater Expansions and Upgrades 23 3.5 Future Wastewater Transmission Facilities 23 3.6 Future Reclaimed Water System and Transmission Facilities 23 4 RATES AND CHARGES 4.1 Overview 25 4.2 Connection Fee Basis 25 4.3 Water System Charges 25 4.4 Sewer System Charges 25 4.5 Comparison of Water and Sewer Service Charges with Other Communities 27 4.6 Summary of System Charge Schedules 28 TOC-1 TABLE OF CONTENTS (CONT'D) SECTION TITLE PAGE NO. 5 FINANCIAL PROJECTIONS 29 5.1 - Overview 29 5.2 Revenues 29 5.3 Operating and Maintenance Expenses 31 6 ORGANIZATIONAL STRUCTURE AND REGULATORY COMPLIANCE 32 6.1 Organizational Structure 32 6.2 Regulatory Agency Compliance 33 7 CAPITAL IMPROVEMENT PROGRAM 34 7.1 Background 34 7.2 Water Capital Improvements 34 7.3 Wastewater Capital Improvements 34 7.4 Maintenance Facility 35 7.5 Total Capital Improvement Program (The Project) 35 7.5.1 Water Treatment Plant Improvements - Cost 36 7.5.2 Water Distribution Facility Improvements - Cost 36 7.5.3 Cost Summary of Potable Water System Improvements 36 7.5.4 Reclaimed Water System Improvements - Cost 37 7.5.5 Available Funding 38 8 CONCLUSIONS 39 8.1 Findings of Fact 39 TOC-2 LIST OF TABLES TABLE NO. TITLE PAGE NO. 2-1 Monthly Water Production 5 2-2 Wastewater Treatment Plant No. 2 Flow Data in MGD 14 3-1 Future Water Flow Projections 19 3-2 Required Water Plant.Improvements. 20 3-3 Distribution System Improvements 20 3-4 Future Wastewater Flow Projections 22 4-1 Existing Rate Structure 26 4-2 Comparative Water and Sewer Service Charges of 10,000 Gallons 27 5-1 : Water and Sewer System Historical and Projected Revenues and Expenses and Debt Service Coverage 30 7=1 Water Treatment Plant Improvements 36 7-2 Summary of Water System Costs • • 37 7-3 Reuse System Improvements 37 LIST OF FIGURES FIGURE NO. . TITLE PAGE NO. 1-1 Utility System Map 2-1 . Water and Wastewater Treatment Plant Location-Map 4 2-2(A-D). Existing and Proposed Water System • • 8 2-3(A-B) Wastewater System Map 15 2-4 : . Existing Reclaimed Water System 17 3-1 Future Reclaimed Water System Map - 24 TOC-3 [This page intentionally left blank] SECTION 1 INTRODUCTION 11 Purpose and Scope The purpose of this Consulting Engineer's Report is to provide pertinent information concerning the issuance of Water and Sewer System Improvement Revenue Bonds, Series 1997 by the City of Ocoee .Series 1997 Bonds. This Engineer's Report is also intended to provide a description of the City's existing water and sewer system, provide a financial review of the water and sewer system revenues and expenses, describe future water and sewer capital infrastructure needs and describe proposed capital water and sewer improvements to ensure dependable water and sewer service for future years. The Series 1997 Bonds are being issued to finance the construction of water system:capital improvements as defined in the "City of Ocoee Water Master Plan(April.1996)", and Reclaimed Water System Improvements as defined in the "City of Ocoee Reuse Feasibility Study (August • 1996)". The Series 1997 Bonds are also being issued to finance the expansion of.City's wastewater effluent disposal system. The water and sewer capital projects to be financed from the Series.1997 Bonds.are described in Section 7.5 and hereinafter referred to:as the."Project". The proposed water and.wastewater capital improvements are necessary to provide dependable and cost effective water and sewer-service for future,years: 1,2 Background The City of Ocoee, Florida, is a municipal corporation created under the laws of Florida. The City of Ocoee is located in western Orange County,.Florida, and is approximately 10 miles west of the City of Orlando. The City of Ocoee was, incorporated in 1925. and is located in the Metropolitan Orlando urban area;. .The City of Ocoee operates under the City Manager-City Commission form of government. The City of.Ocoee is the second largest City in land:area in Orange County and is the fastest growing city (4.7 percent annual population increase) of the 13 cities in Orange County. The City of Ocoee has a land area of approximately 20.5. square miles and a population of 19,261 as of April 1996. The average annual household income as estimated by the West Orange Chamber of Commerce is $36,000, and the median age of an Ocoee resident is 37.2 years old. The.City of Ocoee is experiencing a.tremendous growth rate and continues to receive a mixture of new residential and commercial development. As Phase I of a large Development of Regional Impact (DRI), a new "West Oaks" regional shopping mall (1.2 million square feet) will open October 2, 1996 and will facilitate additional commercial growth in the southeastern section of the City. The City is located in a unique growth area due to the transportation system alignment for this region of Central Florida. State Roads 50, 437, and 438 are the major roads with direct and easy access to the City of Ocoee. The City is also ideally located at the junction of the -1- East-West Expressway. and the proposed Western Beltway. The East-West Expressway is currently operational and the Western Beltway is estimated to be completed by 2002. Other factors influencing the City of Ocoee's growth rate is its proximity to the Orlando Metropolitan area, Walt Disney World, MGM Studios and Universal Studios. The City's unique transportation location brings Ocoee within fifteen minutes of downtown Orlando and the Disney area. The City of Ocoee presently owns and operates a water supply, treatment and distribution system which provides potable water service to the City's water service area. The City's water service area is approximately 15 square miles and currently serves 7,861 residential units and 2,089 commercial equivalent resident units (ERUs) for a total of 9,950 water ERUs. The City's current average daily water demand is 3.0 million gallons per day (MGD). The City of Ocoee presently owns and operates a wastewater treatment, collection and effluent disposal system which provides central wastewater service to the City's wastewater service area. The City's wastewater service area, being identical to the water service area, is approximately 15 square miles and currently services 3,701 ERUs. The City owns and operates one wastewater treatment facility located on A.D. Mims Road. The wastewater treatment facility has a capacity of 3.0 MGD and currently receives an average daily flow of 0.9 MGD. The City of Ocoee initiated wastewater service to the City residents by the acquisition of a private utility titled Prima Vista Utility Company, Inc. in June.1987. The City of Ocoee and Orange County adopted the existing Water and Wastewater Territorial Agreement as part of a City/County Joint Planning Area (JPA) Agreement dated January 1994. The City of Ocoee owns approximately 240 acres of land for effluent disposal and has leased the property to Forest Lake Golf Course, Inc. for joint use as a public golf course. The golf course was completed in December 1994 and normally all of the City's effluent disposal is accomplished at the Forest Lakes Golf Course. 1.3 Authorization In August 1996, Professional Engineering Consultants, Inc. (PEC) received authorization from the City Manager under the Continuing Engineering Contract dated August 1984 to prepare this Engineering. Report in support of the issuance of the Series 1997 Bonds. -2- SECTION 2. DESCRIPTION OF EXISTING WATER AND SEWER SYSTEM 2.1 . Service Area The City's water--and sewer service area is approximately 15 square miles. The City's service area is generally bounded on the west by the City of Winter Garden and Lake Apopka, Ocoee- Apopka Road .to the north, Apopka-Vineland Road to the east and. Old Winter Garden Road/Roberson Road to the south. The City's service area has been contractually defined by the Orange County/City of Ocoee Water and Sewer Territorial Agreements dated November 14, 1988 and amended January 25, 1994. The Water and Sewer Territorial Agreement was adopted by, the City of Ocoee and Orange County to avoid the duplication of water and sewer infrastructure improvements. The Territorial Agreement also provides the City and County with a long-range plan for providing water and sewer service. With the service areas defined, the City and County can plan for service :area build-out. The Territorial Agreement has been adopted as, part of the City's and County's Comprehensive Plans and have been found to be in compliance with the Growth Management Act. No competing water or:sewer service is available within the City's service area.. The City's.water and sewer.area boundaries as well as the treatment plant locations are depicted in Figure 2-1. The City's existing land uses within the water and sewer service area are approximately 22 percent residential, 10 percent commercial, 3 percent public facilities, 11 percent conservation (including water bodies). Approximately 54 percent of the area within the water and sewer service area is undeveloped but designated as future residential and commercial land use. Projected future land usage based on the City's adopted Comprehensive Plan, indicates heavy commercial and:industrial growth in the southern service area along S.R. 50.. The 1.2 million square foot West Oaks Regional Shopping Mall will-open'on October 2,. 1996. Commercial growth is, also expected along S.R. 438 (Silver Star Road).. Based on the adopted Comprehensive Plan, the City's water and sewer service area has growth potential to add approximately.9,000 new'ERUs over the 20-year planning period. Based on a review of 1995 aerials it is estimated that only 46 percent of the City's water and sewer service area is developed. The City's water and sewer service connections have grown at an average rate of approximately 400 new connections per year since 1992. This annual growth rate has been the fastest growth .rate of any similar-sized municipality in the high-growth Central Florida" area. 2.2 Existing Water System The City owns and operates three (3) water treatment facilities within its service area as shown in Figure 2-1. A brief description of the existing water treatment plants are as follows: • 1. The Jamela Plant, located at Wurst Road in the north portion.of the service area, is the City's oldest water treatment plant in service and provides water service to the northern portion of the City's service area. _3- • '�L 1--i If ��� 1 E L_>_-111 • 1 Hr-i —±— -- Li i rl r- 1 —_ j I r r I1f . 1 /t — �- �,.-ice I yet- ' �• , sLr- yf r , . T1 ° �i • �-1._J - - �J - 1j ,-'- — z ' • 3u-P FOR _ 'I�r ,I ( - E CAN�� »® -'" I- i . i �,i � F t,,;' � 5 ti� \NASTEWA�ER 1 .-(-. - ,F I H ,L;�--=� -� E3E,MBe�;iER JAifv(EL ?cPLANT Nb: ( ,4 I �-`-== �'l-%.7 _ . o _____H � KIT,. _ -r, ❑ ('j ^� 11I Yam, _, L-- --� --� �. ' �.`,- 1,I q-- - n� ! i � ' �'I- • i II� L F H rr� �/,j+-,/.I I iT r� /' ' - -°P, -, _g _ ^ t _- 1 `- � - -1,i (± . ? , __ .�..-at-= r t -----__f_.,:AEI .J 1r, I �,L`i.-0.a��a}�;, i., Li L,___ 4 �iIic «,_T._-_.:� I ' `n r C B IB I 'v_'. / ✓Lu '-._.- I t-1 it ''-' D✓ 47T—rr"--.ir i -r: I ,,'*•... - - - - �=_ �►�...—�. ��:�?�:-_p,�,•--„-,-.,.TJ�T I,t_jA--•- � ' ;Viz: I.. ,rL;'`-' _�- ..� - . F: ly. � ,'I: - 1. I I e_ d,..,-- ,-r , - _ram-, _- _.,_ _:t -` =1 J^u�� Z 1 fir. n q h m " (z, l 'n� :r. �r{ 'r:> __ .'1` •-1 `y�':;' .0 S-•saJr og :�. .�-. .�~.�•-_ •L. J r^j._ �`J.:i,Ero>=•5:�.....-_=.L:y� i 1��-:��LI --v..:.-d�r:i; :-5'.5�'��}' ,J �y",-i 'J,'-i:iT �j- ..ram fu�A.�Yo-�. : t .L T ^• g'r•.•.,., 1=, _ bul--2,vT�'-' /_ -yam-•---._.:W� ,,-i-rt .'2"..vTrc. ;I _•;jam - J t7'-= .. • L 1---, d-jL - .�� � _ ;; ;;aye -u.. IL f ,E4f • F, fir. ��-.c_ li I' .. i' =.ter--7�LLII �-`E -F-i- ---- -- -��= - • =r['- - _ J:=� - • I :,_ -' �. '��.� I .i I 4, o'er (' I L'_,4: ' . 1 -L,1 r L h 1— IIF j .% !. .: L_ L 1 _ r3_� I i' ., - • _-L=_ '' el '5 I_. SOUTH•, 'I_�'�::-;.-�-- ...;_;.-. _�_.-.i.��� .---,`I}'- 4 �' �p __ WATER I . .. -- -- , :-Pti PLANT I,1 I'_---471__J 1 !i:14, .::; i_ _( 1 _ �•--:I: i I _. r-� ._.Ifs r_J y1..: �: __ - •sir?---..--- ' � i•--1'- '-�• _. '�-[-_ '..- ":-.E3� :��. - - n e J � r # 11 r '.;.-;zm 4 /� � �- t___,_: - CITY OF O COE /�1 I • WATER AND WASTEWATER — — ..----Hril r"--- -1-- TREATMENT PLANTS LOCATION MAP • • is .. _� • 1. • LEGEND 111111 . L - I. r . WATER I. . 111111PP 71. - -' --- - i T --__.._..-..-SERVICE AREA T - ER i - -.c ,�: ---- -'-------- ANDWASTEWATER N -- ....--•-i-`' - ... -- L.== --, ;_ 1I►� [.1-- PROFE3316NAL CONSULTANTS, INC.i-7 _ _-_ PECI -m• EHOIHEERIXO CONSUL rrs- (FI • ,2_..�i _ pn..w ..sYvs �.1,,- ~'~ r-•� - :'I"L__—:/ "i_L j/ MO Es...Cow.. a.r.n...n.1w...o.w.riw.utet ..r.ax-OW FIGURE 2.1 • - • 2: 'The Forest Oaks` Plant, located along. Hackney-Prairie Road in-""the• northeast portion of the service area, has been in service for approximately ten (10). years and also provides water service to the City's.northern service area. - - - •3:'-:. ` The South Plant,--lo'cated east of Maguire Road and south of-the Florida Turnpike " ' in the southern portion of the City' service area, is the City's newest and largest • . • • water plant.` The plant provides water service,to the commercial area along S.R. 50 and the southern service area. • " • ' • The City obtains raw water from:a series of.deep wells located at the three (3) water treatment plants. The potable water wells draw from the.upper Floridan Aquifer. The City's water supply originates from five (5) existing deep wells.andthe City has two (2) deep wells.currently under _ • . construction. 'Table 2-.1 presents historical water flow data from 1991 through 1995. The City's ...three (3) water treatment plants meet regulatory .agency requirements for average daily flow, 2 . • - • maximum daily flow and peak hourly flow: • • - • TABLE 2=1 ' . MONTHLY WATER PRODUCTION al ns n..G a. .. . ........... .:::::::.::::.:.;:;.:.:.:: :Water.F...... ....:::.Plan...::.::::: :.:::.:.::::.::::::::::::::::::::::.::.::::::::::::::::::::::::::::::::: ter> .;lant: : Tot' ..::..::.:.;::W >`:Floe>`< October 1994 31 22,414. 19,671 44,18T. • , 86;272 November 1994 .30 ' 22,153 • -18,734 . . 43,225- . - .84,112 December 1994. 31 19,615. • 20,137 . 40,818 . 80,570 • January 1995 . 31 , . 18,680 ' ' : 22,858 40,196 81,734 • February 1995. ' 28 •. 20,678. 20,201 44,525 85,404 • - March 1995 : . I : 31" _27,043 _-24,892 • 53,559 105,494 April 19,95 30-- . ;36,687" : •21,166 59,661 • 117,514- . May 1995__ .• "31.. .48,157; 29,058 . 80,332 , - 157,547 • .June 1995 . . 30- . • 31;703 • • 30,000 -• 72,7-85' 134,488 .July 1995 ."-"':31 30,967, 27,170: 67,527 125,664_ . August 1995 ' ' 31 23,766 3.0,898 66,631': • • '121;295 . September 1995 • .: 30• 26,049 26,891 . 56,893 -. • .109,833; - . Average_=" . _ . 27,326 24,306 55,862 107,494 -5_ The following sections provide brief descriptions of the City-owned water treatment plants. 2.2.1 Jamela Water Treatment.Plant Raw water,is supplied to the Jamela Plant from two (2) deep wells which penetrate the upper Floridan Aquifer. Well No. 1 has a 12-inch diameter casing, a casing depth of 125 feet, a total depth of.622 feet and is equipped with a U.S. Pumps vertical turbine low service pump rated at 550 gpm. Well No. 2 has a 16-inch diameter casing, a casing depth of 136.feet, a total depth of 650 feet and is equipped with a Worthington vertical turbine low service pump rated at 2,000 gpm• Raw water pumped from the wells is discharged to a 2,500 gpm.cascade tray type aerator located on:top of the ground storage tank. The aeration partially oxidizes hydrogen sulfide in the raw water.. The.raw water is disinfected by adding chlorine and is discharged into a 500,000 gallon concrete ground storage tank. Hydrofluosilicic acid is also. added to the raw water to provide fluoridation. Treated: water is pumped from the ground storage tank by three high service pumps and discharged'to the distribution system. Two high service pumps are rated at 1,000 gpm and the third high service pump is,rated at 1,200 gpm. A 500,000 gallon elevated steel storage tank is connected to the distribution system downstream of the'high service pumps. The tank is connected to the distribution system, stores water for emergency fire flows, and maintains static head-(pressure) in the distribution system when the high service pumps are not operating.. A 250 kilowatt;standby engine generator provides emergency power, and is capable of operating the 2,000 gpm well and a related high service pump. Due to the deteriorated condition and high maintenance requirements of the Jamela plant, PEC has recommended this plant;be removed from service when-the recommended-Forest Oaks and South water plant and water distribution system improvements are completed. : The City anticipates the removal of the Jamela-WTP from service by. 1998. 2.2.2 Forest Oaks Water.Treatment Plant The, Forest Oaks Plant was,built by developers, and sold to the City as part of a Developers Agreement in 1986. ;Raw water is supplied by two deep wells, which penetrate the Floridan Aquifer.'-Well'No. 1 has a_7-incli diameter casing, a casing depth of 609 feet,a total depth of 1,168,feet, withdraws water from the lower. Floridan Aquifer and is equipped with a 40 horsepower.vertical turbine low:service pump rated at 700 gpm. Well No. 2 has a 16-inch diameter casing, a casing depth of-142 feet, a total depth of 366 feet,withdraws water from the upper.Floridan Aquifer and is equipped with a 75 horsepower vertical turbine low service pump rated at 1,300 gpm. -Presently,a third potable well is being constructed and is proposed to deliver 3,500.. gpm from. the -lower Floridan Aquifer. The third well is scheduled to be operational in early 1997. Raw water is pumped from the wells and discharged into a 3,500 gpm cascade type aerator located on top of a.400,000 gallon concrete.ground storage tank. The aeration process partially oxidizes hydrogen sulfide, thereby reducing the hydrogen sulfide concentration in the raw water: -6- • The water is discharged into the ground storage tank and is disinfected by adding chlorine. Chlorine is provided by two (2) one-ton chlorine cylinders (one is a standby cylinder) and a chlorine metering station. Hydrofluosilicic acid is also added to the raw water to provide fluoridation. Treated water is pumped from the ground storage tank by three high service pumps and discharged to the distribution system. Two high service pumps are variable speed and rated at 800 gpm and the third high service pump is constant speed and rated at 1,500 gpm. A 12- inch diameter propeller meter measures the treated water flow and has a maximum capacity of 3,500 gpm. A 275 kilowatt standby engine generator provides emergency power, and is capable of operating both wells, a 1,500 gpm high service pump and one 800 gpm high service pump. The standby generator is driven by a diesel engine and is automatically started upon loss of primary power. 2.2.3 South Water Treatment Plant The South Plant was constructed in 1992 and is the City's newest water treatment facility. Raw water is supplied by one deep well, which penetrates the lower Floridan Aquifer. Well No. 1 has a 24-inch diameter casing, a casing depth of 800 feet, a total depth of 1,450 feet and is equipped with a 125 horsepower vertical turbine low service pump rated at 3,500 gpm. A second well has been designed and the construction is underway. The new well is proposed to deliver 3,000 gpm of raw water from the lower Floridan Aquifer and is scheduled for completion by early 1997. Hydrofluosilicic acid is added to the raw water in the well pump discharge line to provide fluoridation. Raw water is pumped from the well and discharged to a 3,000 gpm cascade type aerator located on top of the ground storage tank. The aeration process partially oxidizes hydrogen sulfide, thereby reducing the hydrogen sulfide concentration in the raw water. The aerator discharges the raw water to the 670,000 gallon concrete ground storage tank where chlorine is added for disinfection. Chlorine is supplied by two (2) one-ton cylinders (one is a standby cylinder) and a chlorine metering station. Treated water is pumped from the ground storage tank by four constant speed high service pumps and discharged to the distribution system. One high service pump is rated at 370 gpm, two pumps are rated at 540 gpm and the fourth pump is rated at 1,350 gpm. A 16-inch diameter propeller meter measures the treated water flow and has a maximum capacity of 6,000 gpm._ A 500 kilowatt standby engine generator provides emergency power and is capable of operating the entire South water treatment plant. The standby engine generator is driven by a diesel engine and is automatically started upon loss of primary power. 2.3 Potable Water Distribution System The Ocoee water main distribution system is a network of service lines that presently extend to all but the recently annexed northwestern portions of the City's water service area. The northwestern area was .recently annexed (1993) into the City and will require new water distribution mains to provide water service to the proposed developments. Figures 2-2 (A-D) present the water distribution system. -7- . : . . i lir-- / • -. • / . . ,,,- •. . r •. . • li ,. ', . : ....._ . • • . 1 i• I // ,..\, : ...., :i . . I, . . . . .. i . 'HI , . . • i i " . ; // i/ i i I 1 . . • 7fri-7-7r7-- GRAPHIC SCALE :!-I Irle!I . _L . , .. , , 1//1 '-.---- 0 500' 1000' 2000 ' - ,... • , ...1 . i • ' ... ----..-- 5 & C.1) ,...._. •/ ._-_-.:••• - . • . . ...• . . • - FUTURE 12 - 7 • I.- 2 . . • . FOREST LAKE '-:_. M < 7._- . . P • ...., • 1 r it . ' - - 14 FUTURE 12 ' ii Z 0 .,-_,............H,-.,,..,, 0 IA i...1 E 1,-=‘,....cr<7.1--,- .=If. E.) I; 1 ...- - . R17" ','. FUTUE__ /./.. ,.% FUTURU2L.,,._ „,,,,L______ ... ,__ ,,„ .3 . , C•J 1.,- ; L cff 4" 07 ll 1 VIGHEM ASI 1-e-, . ._!.1 " p66"•6.., 6,. I no .• . • 1-" , • . . i.,..% 1 1.7... . • ; • 6 I- - . . _— _-._ 2"__.-=-L'..1:--'=' ,:.e.ca17.::::•-:: =:':___•_ . . 1. . , c f--' :c, 1--Li - -- : . .-=_=-.7.2.1•12,-: '4. •8K:., I- .. . 'i. ,:_sx•Er ,- .1,-, r.z.,.,„,.., 1..., FULLEL12" _I'..,,, ,i__-:11-T__Q SFUTURE_j: Th- .. . • , 311 :5— 4 a . . , , ......., • , 4, 1 / • , , CO 1 . I'air •—`7,1'n'—'z. . . . . . • D • — ..,'.1-• • • • • . . . . El • _.); ., 1 . . . . . . . .,, • . ----11 ..1 , .:;±5=1.....1112..-. .6 . . i . —WM/Lai . OTT !II i " 6 - , I • • , a ;,.....: i VALVE 177 . . • -' • i 6 - SHUT 6i. , 1...4L-11 li . -.. nrr 7,° - " 'P- !I - ' . /1 ,6 7. 17 at,s, :; ....-.. .,: i- ,,._, sriv, . . ID '' 7" IL , - - ,.._ ....„ -1 ',;,• ,, •011) :•1,q.''' ',,,• I , c,- _, ..-._.-., . 6, I 11X , I 0_ .i ''' • ...i-i I .. • .. •, , A• . . . . • ,(.• , — .7.1.7... ' --.7 0---./ ' U vnivi' ... - • • , : , a : 11 nirtiliEL6._._.--a , - ' ! . ,=C ' ..:: 1, (I 1".' • . ••• 1 ' . • . 12 I 6. .6 /; . woj x: ' --4- ' • 6- . 1 n • •-L-__--'!"--6Y----,.. :-fri ',--\ . i1 k.../ ' '1 V;: •— ., .. :.--6-7--'- • MATCH LINE SEE FIGURE 2C FOR CONTINUATION . . , , .1111/Ail 1 iim:lir i.Ait wk.,. ,i• :•,,,,, EXISTING AND PROPOSED FIGURE 2.2A poi II , ii,",,!:.; 4e,:ply WATER SYSTEM • i • II 'II • Ij '1 1; II • _. It i� -_—__—P07LORD116 iD__-- ____--__ .__ Q • • T i�•-I i - �,,/ — °...„ . 3 i - 1_.: _ _ °.tp" <;---- -.-_Dail JC—__ —•— _ �1 6� '• j 'mom%'—j/`Iiwa-.' ( .. _ �' J/ POSSIBLE ��EYERGENCY I OCPUD �[�C 1`.--J �' 3 INTERCONNECT dp.,;_�!�""-•r----1 I _.- FUTURE 8" 6 , • p ...ram-iL-.�-II Ii - - I A'_- a 0 I L. " u Q ?:n;.. a l'+Karr ;I _ Z .« ' r- - — _1 I FOREST OAKS I FUTURE 12" WATER PLANT • Z L _II _ mac �.... --_-_.. I r.-'1��,�= it J -- Ce . , 0.. . „ 0 i , s. .. e _1 ; 6 °6n � � FUTU 12' _ 1 - § I c a',I4- . . _. .. . ..„ L.L.— _.-�` —6,a.I. © i..— a- o _ JAIJELA cu, -6....- im.,c'J •• `I ° _ an �1 !,..1 :1 FS I I wlWATER PLANT I POSSIBLE - • artw MX ___. --u EYCRCEN C, PUD B_ • FUT - '""" 1UT U a, 16- 16- FUTURE 16; INTERCONNECT VKVE Rov. BO6TER R• VYVC 5 " I D Q 6 sic. j �,1 10 001 on 0 f2 1 I II ° - uK.c • C _I 9 M- 6. �Jyj l` ...rJB.... q • i N p, I =—_PROPOSED b" .�� �I a6 CDUNtt. wY L J—'LJL_L- ,,,9,,--.-ram 0 '; tr ® I =ew,00m a—F— . MATCH LINE SEE FIGURE. 2D FOR CONTINUATION y'R1 `. . /r�' '.. EXISTING AND PROPOSED t((3`.I I,' WATER SYSTEM FIGURE 2.2B MATCH LINE SEE FIGURE 2A FOR CONTINUATION II MIL !. /I N1x. 6{I .t_ _am 1 -- C a.. .; �r _-�i�� ' 10,- •- —,L:4 a mr;, «ors x- 1 'saaa 2 ._1 : _ __ r • tz pp l0- KISSIMMEE t2 6- 6 - tr 12 N_ AVENUE --Jmv..- _ - IL 1i - WATER PLANT i 1 6-- P16' • rnr• cr— (OFF-LINE) - -a_- q 12- I; 6- DOER nrgq 13. ! - ___ ID J LL_ J • c !: IL _'I -__.- �__I_mar 2' fit-=_-- .. till . - - TIRE 12. . - -Ie i i ; /Q24.1.- II a- 12- •E17 •• i 61 I I - • 6 e yy EI:.1'UTURE 8' Q" E[.:.[1 12 1 l I--�2L1 JTURE 10'l2 I. a; =F • 6910 �• H r 0 Q . ,2 2 . ----__ z -ROMA I - R�. — 12- 1i ''- N • I ® Iw • . _ • 12 . 'I _ SOUTH - C� i; L,.,. -a- I FUTURE 12" WATER ' 6 � T PLANT; `°� _ ;1 z• if '. -.. .. B._ :+r J 1 a 1' e . 1 ,i • • I . "4;44 iI1111 r �11�1�� yln EXISTING -AND PROPOSED .';'i' if ',i1 IiPi,' WATER SYSTEM FIGURE 2.2C • MATCH LINE SEE FIGURE 2B FOR CONTINUATION • .- • 11 1, .0..3..1 . • --: -- --11 :i •• II -.., • ..Q •,,!-Z,,. 8 : 74 i I I °4aii.\..?:tt::--.•r,-P1.—i1.',.•A.1'_.9"•1_I11t-6'-.-.,6.- 1 1' — • -,- (._.---__'-_-'__1*,1•,7...ii_:m_.-.._.._•.=/-I I L_.,i_.,l•-*r,•--.•-- 11 i _-1 •_---_ . 4 12 .S1 6 • • 1 P ,; 1— L i = — 14„II,iI i i _II_ _II „._____ -_,• 2- INTERCONNECT , I•""a'i IA i ' .-3 ,, ,, .11 11 ,,, -ahem WiT= 1 I -TIIr'ill Et . --iJ ___ I IL9-.-'..) ... )4---...7.1.. ---)f, )_ H--,--'1-----—1- ..----- I L____ 6 OwagT-G", -1 ,:i. 2 -‘2 . ''''• .11--D'1. i i! --,-. i I 71r ,. L 1 ----,---11- • i.„,ik , . .,, ,) i -- ,Li....4 1 !!,=._I! . ii ..._ .:_, .___,, FUTURE 12'11 d 11,4;1 WIIW . •• .• • . 0 . , "•.__ .=.•,,,_,.,____,,, "= i ) CV 1 • •I •1 z 2 2 I..1 1: < 12- • , ,L 7..,... / ..j i,L__II iL___, . D Z ,.... ‘.1..,.,...:1•.= i li . / .•._. 17z0(.—.) — 12. 1,...,44-...„„,-..r•L_—.....„.'_-,-,--,.--,--It-,-,,\L_,g,., \ a 2 1 g!i,r.i, -l1i,i• iqlL ( / I.F— ._.1,. Ii 1_______..--,--7-x -- _--------- .. .. . CC 1 •.r:...,,;1 i, L- -:--,..,,- !. 1--....j .' : - '' ____ - • . Al—------ I t.‘,r • . .. if 1 1 ...._.... - *--- ...1____..=__Ii c„ 3-7. ..c. li====.,L-? E....,, 1 . - !...__, r ID I - t_ w I. .--,, T 11 n -- 1! •, ,._lkii,,,n4I.,ip-7. . 1. - 1=-' II 1 1— • I 1 li '-• -, ) Jlii---))—, .-,,r---- , ' ,./1.II—:, ,,,,' ,1!.. I L.L.1 •rtaa.P .' I ELI OCO ! CO / CITY OF o A .. 1 . EXISTING AND PROPOSED WATER SYSTEM. o < m LEGEND . . 16" WATER LINE 8" WATER LINE 14" WATER LINE 6" WATER LINE . • 12" WATER LINE 4" WATER LINE 10" WATER LINE 2" WATER LINE _ .:: VALVE 0 WATER WELL COLOR CODE .. , EXISTING DISTRIBUTION SYSTEM ol'' •• .•:4 . • ro' - I- -•- IMPROVEMENTS REQUIRED FOR A TWO PLANT SYSTEM THROUGH YEAR 1998 IMPROVEMENTS REQUIRED FOR A TWO PLANT SYSTEM THROUGH YEAR 2014 DEVELOPMENT DRIVEN IMPROVEMENTS . . .. . ..—.••.— •• WASTEWATER/WATER SERVICE AREA BOUNDARY • . . • • . Ord'MIA li T f '1.11/ EXISTING AND PROPOSED FIGURE 2.2D P-",;:,, WATER SYSTEM . , The existing water main distribution system consists of a series of 16-inch, 12-inch, and to a lesser extent, 8-inch_and 6-inch pipes, that are comprised of either ductile iron, cast iron, or PVC pipe. A cost-effective distribution network has been planned utilizing 12-inch diameter mains as the maximum size for future mains within the primary distribution system from both a cost and a hydraulics consideration. The water distribution system is divided into two separate piping networks, with north and south portions of the system isolated by a number of closed valves. The north and south regions have been isolated and are operated as two separate water main distributions systems due to the significant elevation differences between the central northern area and the remaining system. U.S. Geological Survey Topographic maps for this area show • that the topography within the vicinity of Vignetti Park, in the northwest, is at an elevation of 170 feet National Geodetic Vertical Datum 1929 (NGVD29) while areas in the northeast and southern portions of the City have elevations as low as 90 to 100 feet NGVD29. These significant elevation differences within the service area require separation within the piping network system and pressure adjustments at the treatment,plants. Without this system of isolation, pressure from the Jamela plant(highest elevation) would overwhelm both the Forest Oaks plant in the northeast, and portions of the southern network served by the South Water Treatment Plant. The higher elevation in the northern service area requires higher system pressure to be provided by the Forest Oaks Plant to pump the treated water uphill to the north.. central area to supplement the Jamela Plant from the Forest Oaks Plant. - 2.4 Existing Wastewater Facilities The City of Ocoee currently operates one wastewater treatment facility, Wastewater Treatment Plant No. 2, located north of A. D. Mims Road and shown in Figure 2-1. (WWTP No. 1 was taken out of service in 1992). The City of Ocoee acquired Wastewater Treatment Plant No. 2 from Prima Vista Utilities in 1987. The facility is located on a 128-acre site north of A.D. Mims Road. This facility utilized the biological contact stabilization treatment process and had a design treatment capacity of 1.0 MGD. The permitted treatment capacity was 1.0 MGD. The treatment facilities consisted of a "ring steel" package plant with bar screen, aeration, clarification, chlorine contact, aerobic digestion and sludge drying beds. At the time of acquisition, disposal of the treated effluent was via two percolation ponds on the plant site. The total area of the two on-site ponds are 8.57 acres and 5.7 acres: The City also acquired 240 acres of land for effluent disposal. Sludge generated from the biological treatment process was disposed by land spreading on-site but this practice was discontinued in February of 1995. In 1991, the ring-steel treatment plant was expanded to a 2.0 MGD. facility. The expanded treatment facility utilized the existing ring-steel structure for the required tankage of an anoxic/aerobic treatment process and sludge digestion along with two new concrete poured-in- place clarifiers, a new chlorine contact tank and modifications to the existing chlorine storage facility for clarification and disinfection. The overall treatment process was considered to be -12- • secondary treatment. Effluent disposal consisted of two (2) percolation ponds at the plant site and two(2)Rapid Infiltration Basins (RIBs) located at what is now'the Forest Lake Golf Course (referred to as Site No. 8 in FDEP operating permit #D048-202981). A master effluent pump station located at.the treatment plant was used to pump the effluent to the Forest Lake Golf Course. Also in:1991, the City accepted ownership of the privately-owned M&M Utilities and its 0.10 MGD package wastewater treatment plant ori the west side of the City. The City removed the existing package plant and connected the existing collection system to the City's WWTP No. 2. The M&M Utilities plant contributed an_estimated flow of 0.10 MGD to WWTP No.'2. In 1993 and 1994 the City utilized proceeds, from the Series 1992 Water and Sewer Bonds and WWTP No. 2 was expanded to,a permitted capacity of 3.0 MGD, with the addition of tertiary filters,chemical feed, and high-level disinfection facilities to achieve the public-access treatment level and monitoring required by FDEP for reuse quality effluent. This facility is a poured-in- place concrete structure and is estimated to last approximately 50 years. The City's expanded _ WWTP utilizes a new and efficient Kruger Treatment Process (biodenitrofication) that results • • :in substantial reduction of operation and-maintenance expenses. • In conjunction with the WWTP No. 2 expansion,_the 240-acre remote effluent disposal site was converted to the public Forest Lake Golf Course. The City leased the 240-acre effluent disposal site to Forest Lake Golf Course Limited Partners. Private funding of approximately $3.0 million - was used to develop the Forest Lakes-Golf Course.-.Two (2) percolation ponds are located on the golf course site and are rated at 1.0'MGD: Effluent disposal currently is accomplished by either; (1) irrigating the golf course with reclaimed water from the treatment plant (1.0 MGD), (2) discharging to the.two (2) on-site percolation ponds (with a total capacity of 0.5' MGD), (3) discharging to the two (2) remote percolation ponds located at the Forest Lake Golf Course for wet weather disposal (with a total capacity of one (1) MGD). The combined permitted reuse capacity of the percolation ponds and golf course.is 1.5.MGD. Table 2-2 provides historical wastewater flow data for October 1994 through September of 1995. During this period the City has averaged over 400 new wastewater ERUs per'year. • -13- • • TABLE 2-2 WASTEWATER TREATMENT PLANT NO. 2 • FLOW DATA IN MGD .......Flo. ;>::>::;.::»>;:.:.. :::..... ... .. • F Max Da Mm Da ............... ....... . ....... ............ .. ....... .. 99.. October 0.813 0.910 0.609 1.119 0.749 November 0.821 0.969 0.642 1.180 0.782 December • 0.890 • 1.0.59 :0.671 1.190 0.754 January 0.877 1.242 . 0.806 1.416 . 0.919 • February 0:848 0.978 0.661 1.153 0.779 March 0.869 1.047 0.728 1.205 0.838 April 0.863 • 0.965 0.695 1.118 • 0.805 May 0.856 1.003 • 0.708 • 1.172 0.827 - June . 0:904 . 1.139 . 0.807 1.260 • 0.893 - July 1.057 1.607 • 0.847 .1.520 0.801 August 1.189 1.4 1..06 1.177 0.892 • September . 0.983 1.16 0.849 . . 1.180 0.864 Average. • .0.914 1.123 •0.757 - 1.224 • 0.825 • 2.5 Existing Wastewater Transmission Facilities The City's wastewater collection system serves 3,701 Equivalent Residential Units.(ERUs) and is shown in Figure 2-3. 'The City owns, operates, and maintains approximately 40 miles of wastewater collection system. The City utilizes a combination of gravity and force main systems to collect and transport wastewater to WWTP No. 2. The gravity system is comprised of PVC pipe ranging from 6 to 15 inches in diameter. The force main system is constructed of PVC and ductile iron pipe and varies in size from 6 to 12 inches in diameter. The City owns and operates 32 pump stations throughout the collection and transmission system. Additionally, two (2)pump stations pump to the system, however the City does not own these facilities and only assists with the maintenance as required. The owners of the facilities are responsible for cost incurred.for maintenance. The City's wastewater facilities are relatively new, improved regularly, and generally well maintained. -14- • lit • 1 f • 1 I • N.T.S. — — - - ;i -- I- -- -' i` 4;.� , i.i1111- 'l'' ,"4) i I i.... .., '' i . . ,•-, l„1., T T F'HiiIt,l i[ , /�/ -__-.- i -.__-_ �_. --�_-,-_ -.,Y;� te • - _- .. .Itl-•'�,miu _- `+i .- .,a}:,-;,.- .:'. ._u.-{_ • `"y jt - "- FOREST!_JAT '�•.u. i`-�L_i I\ _-_-i��.L-I II��_�. _1_7'-".i •�-11'-lkS�,'(.i'.TTf,`-.�._� .- ______ _ /•,— ---='a I-- �- r- I I:OLF CLI;II ]_..._-:1= ! 7�'llW1.7 -'y iLi'-1-3 I II 'fir z f-_ a �._,=a�._. 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I I I �[_� ; 1I1 +r111 , lSll Lr J! �ftl.°::.I I/A ,.,, ...,.. .!'. tiiuil .•'y aIf111$T:!�,.5 ` rsr � - ..J- ,,. ; _ _----• .,IT:;, (�_ ,Y tt -rLL f —snnnin trll[�,hu. 'c O r=rr; . _J F '., �a4-2 �-, LIIt r tti fi1'' 'J,iFr: .-, ,1 :Lu$ --__ , .til i+k4,-.! Li CITY OF 0 c0EF' Z L: -t1„ii 144fH1_: I--'- Iy .i',- uti� •I c..FLLErj'a-H IIj-t-4:11'-1 'Lri '_° — „tt -IF • ' • WASTEWATER SYSTEMS MAP LYY --- 1 '-- y �I I! —I Fr, _ _ L - -iL_ j , ,, I'' LEGEND-- II ^• •"' . i t '° ss 15 SANITARY SEWER ii/_ __—- —- - —__ if —_-__ _-_ LIFT STATION I 5° II !' II i. 1r r 12' EFFLUENT FORCE MAIN i I° MASTER REPUMP STATION n__.:' _ '2-' 12' FORCE MAIN MANHOLE -- WASTEWATER SERVICE 0- i , II '. 1°•ss 12 SANITARY SEWER I; I AREA BOUNDARY _- 1 :_J .. Ij II II II 1 I 10 r" 10' EFFLUENT FORCE MAIN I, II I UNINCORPORATED AREAS rT� II Ii__--i_T j- ;' • a ry 8' FORCE MAIN N I� I it f it II 'i V' B• SANITARY SEWER Il •,III I' II °•^' 6' FORCE MAIN - _, e•ss 6' SANITARY SEWER .....,•�,.�•..,,.w o r,.,4:„m 2.6 Existing Reclaimed Water Facilities and Transmission System. The City of Ocoee currently provides reclaimed water to the Forest Lake Golf Course for on-site investigation. Under normal conditions, the golf course receives 100 percent of the 914,000 GPD of reclaimed water produced by WWTP No. 2. A 12-inch diameter, low pressure piping system transports the effluent from WWTP No. 2 to holding ponds on the golf course site. Figure 2-4 depicts the existing reclaimed water system. 2.7 Wastewater System Growth Restrictions Currently, constraints on the wastewater treatment system relate to the lack of available area for the disposal of wastewater effluent. Expanding the existing reclaimed water system will relieve these restrictions. 2.8 Capital Improvement Program (CIP) The City. of Ocoee is experiencing significant growth throughout the City's water and sewer service area: To provide long-term and cost-effective water and sewer service a Capital Improvement Program (CIP) has been developed and is defined in Section 7. The Capital Improvement Program (The Project) for the twenty (20) year planning period is as follows: Water Treatment and Distribution Improvements $4,973,000 Reclaimed Water Program : $2,790,000 Reclaimed Water Program (Retrofit) .: : $1,050,000 Effluent Disposal Expansion $1,500,000 Maintenance Facility $500,000 TOTAL V $10,813,000 • -16- • j'. I iL- -- ` 1 I I - - I--- 1 19'd.13/fl-_--_ -, .1, T n EFFLUEN' i` ,..� �'' a 1 i DISPOSAL ' _ _ I �. - ., lM // —i—SITE # --- -- Ir j `�f 1.^ _-� i ,I - 1_-- 1 •, •tMl `1111 =niit d ,.,----.1.---- — ^ __ gyp] I 17 I ���� I � „L____— \L ill J C ®`Ll1i `>, � /I..,I �� RANSM sSS,10 j �a�l n----., I- _l�_• r ' AIN i-rr�lll,a — `;'r,iL: yu44 I� I 11---- MI il r”1-E r, CITY OF OCOE I u,t I ',•;-�it/f� Y�\ —�^ mMlilln WWTP 2 r=-I---- -}-- :// �/ '\\�� � I� # III r — il rii --11 MAST R EFFLUENT • -.,LLT,It____ -- �P • • PUMP TATION ,�='__� I • I1 I 1;-[-L--Itsal vIgrP41..,r/Yr ..rt�,'d .F k .,. .. TI of L. 1r-- ----I 't' i s -' : ry�E .- ' � .. I. = !ice i 4 �'a` . � /I{ - / '`'' J!I:Ihk _f r _ --1 Imo- - ,' 4 .iT ri---7:-77-:-4-7,-;:;:. ti .,z-,:-.,-*_,.., L___1 ::-.4_,--,-Li __________Ea_zt-tp, agip 2....-0-ii,f,;:,".. ,- - I ' ''''' l'7.;'''- r�I �I is (,, 0'�� r�I pw - L===_:-1_Ili: iI 1.,-, - � LL// 11�11JFY„9 1- i r. 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IT..;..:'-.: : � -7C'i • �, .:ham. _- -- :ii ..��� ir.;'',_... � tr p 7T J � i*l::;f1�T�rTI�� i 3LJ I�i _ f j1 i- G e:... -11- - r. L -_ -1_ i--, ,,H4 17 ZLr➢Wr Ill! . • �'T II jr•,.,({ j fir. , • _,--' , Iliii CITY OF OCOEE • --1--- ;;,...iii EXISTING RECLAIMED WATER SYSTE • M `='' _- IIIIIIII : .',..,....fl.V. ...,—iiiiii, f..t.11. .F.----A • • C — I °1iEIL� �■p�� VI Mn."' m j-- ( . r n • :;! I' r_-i ' '- - -' C PROFESSIONAL ENGINEERING CONSULTANTS, INC. engineers iig W 1!Y CY•r•rY C•n.n LW C••.1Wm iNel.Or*.no-.WM M]/Hr-!ar FIGURE 2.4 SECTION 3 WATER AND SEWER FLOW PROJECTIONS 3.1 Overview Water and sewer future flow projections have been developed to produce the City's Water Master Plan, Wastewater'Master Plan and the'Reuse Master. Plan. Water and sewer flow projections were developed using a methodology which employs such factors as historical growth rates, land use designations,_ reserved water and sewer capacity, vested development projects, dwelling unit densities, traffic projections .and modelling, socio-economic data and local population projections.. PEC has been.the City's continuing consulting engineer since 1987 and has assisted the City in development of the following long-range planriing:documents: City's Comprehensive Plan and All Amendments (adopted 1991) :. Master Water Plan (1996) Master Sewer Plan (1988) Master Reuse Plan (1996) Water and Sewer Rates (1992) Water and Sewer Impact Fees,(1992) Traffic Impact Fees (1995) . Traffic Modelling (1994/1995) Consumptive Use Regulations. :. Our involvement in the City's long-range planning process has assisted PEC in developing accurate 20-year projections for the water and sewer systems. The general process used for projecting future.water and sewer demand consists of the following steps: 1. :Review socio-economic data that was used for impact fee and traffic analysis. 2. Establish a grid or zone system to subdivide the City's water and sewer service area into discrete land units. Traffic area zones (TAZ) were used to provide consistent model parameters in all master planning projects. • 3. Project future land uses-based on the current and approved (by Florida Department of Community-Affairs, DCA) land;.Use designations: .. 4. Estimate build-out period for the City's water and sewer service area. -18- • 5. Review approved vested-development projects, zoning applications, and the City's concurrency management program. .. 6. Review pre-purchased water and sewer capacity and the Revenue- and Maintenance Fees. 7. Apply average consumption factors per dwelling unit to develop annual • flow-Projections. • ' . . The City's current'population is estimated to'be•19,261 and the population estimate for 2014 is 42,000 people. • The increase in population is estimated to be 22,700 people over an 18 year period. The socio-economic analysis for the City of Ocoee indicates an average of 2.8 people per:dwelling unit. Based on existing trends per household, the City is expected to add approximately 451 ERUs-per year through 2014. The financial projections of our Engineer's Report (Section 5) are based ona conservative annual growth of 350 new ERUs. 3.2 Future Potable Water System and Transmission Facilities Table 3-1 presents future potable water flow projections based on the described methodology. TABLE 3-1. ' ` FUTURE WATER FLOW PROJECTIONS >::::>:::::>:::::>;;>::>:<: ........................:.........:.....:::. .::::.:::.::... CONNECTIONS .............. .................... C ALLONS ...................... 1996 • 9,727 , . • 2,936,100 • '1997 10,077 3,023,100 • 1998 10,427 3,128,100 1999 . 10,777 3,233,100 2000 11,127 3,338,100 . • _ 2001:. • 11,477 • . • ' 3,443,100 Required expansions to allow for the continued growth of the City are required at two (2) water treatment plant sites -= Forest Oaks and• South Plants - and to the potable water distribution system. The following table, Table 3-2, lists the required installations and'improvements to the • water treatment plants in order to allow for continued City growth. • -19- , • ' ,.•• _ . : '..-'.. . . '. - ._'. . . •. . •. . , •., . . . . . . . . . . • . . . . .. • . . . . . • . • . . • - • : . . • . . . . . . • . . . . : . . .. . .. . - . • • - • • . •• • - . . .. . • • . „ . _ . . . . „. . . . . . . • • . ..... .. . • . • ••-• •. : . , . . . . . . . . • ' ,-.".,1:,.. -•'.•.TABLE 3-2- :•". .. . • " • . . .*• .-: REQUIRED WATER PLANT IMPROVEMENTS • . • • • • . • !iiiiiiiienEiiim:FoRtsp.OAks;i:,W,tpainamimi;iimiiii.imi :::;:,::]aiNimi•i::;i:i::;iiEsoulritiiwrip,:,::,,-,migi::: iiiii:::::::::iiiiiiiiii]]:]ii:::::ii- .,,,,,,.?,•:•?:•:.:.i.:.:•:•:•:•:•ii•:••::i::::...:::::.................,...:.::::::::•.:.:::::::::.:.:::::.„,.:.:.:.:.:.:.:.:.:.:„.:.:.:„.:.:...:.:.:.:.:.::::::::•:mmi::i:i:::x:i::*:-:::.:: ;:i::::_K:::::::i*i:::i:i:i:,•:.:•:.:•:::.:.:.:.:.:.:.:.:.:::„.,:.:.:.:........:::::::.:::.:::::::::.„:„:.:::::•:::•:::-:•i:::::::iii:i::: .:,:::::•:::::],iiim:iii: : . . High.Service Pumps (3) , ,... ." . •. - 'High Service Pumps (5), . • Building Improvements - • • --- - flow Meter .• .. ... .. .. ... s . • . . ._ Yard Piping Improvements - • .• . • , .Water Well and Pump • . . • Control System Upgrade • : . . . ' - ... -' • - ' -• - .• •• -' : • -- Flow Meter . . . ... . . . _. • --. . . Generator Upgrade " • • - .. • . -, : . . . . . . • . .. . . . .. Figure 2-2 (A-D) depicts the necessary piping•to allow,for City growth.. Expansions relate to - . installing piping in..areas of.future development and providing, additional piping in currently developed''areas to provide-for greater'flows and an increased reliability. The following Table 3-3 lists the projected distribution piping improvements and correspond to the numbering '• identified in Figure 2-2...-- • . • . • • . .. , • . . . . • •. . • • - • - - DISTRIBUTION SYSTEM IMPROVEMENTS- • . . • -- ••• . . -• I: 8-inch. . ,East/west from Clarke Road/Hackney Prairie Road to Sawmill:(3,450 feet) . • • 2. ,. . 12-inch • • - East/west along Hackney Prairie Road.to Roth Road (3,400 feet) • . . . . . . . • ,3. -12-inch . East/west along Ocoee-Clarcona Road to Carpet'Street (1,500 feet) • • 4. 12-inch ' gortli/south.aking Ocbee-Claicona-R6ad from 15th Street north (4,500 -• • feet) ... . - - ' •. -'• . . . - • • :-• ,• 5. • 12-inch -. • East/west along Fullers Cross' Road from Ocoee-Apopka Road to Adair • • .. - - i_ .- . .. Street (6,000 feet) .. - ' .. .. • - . • .. .. ... . - ....,.. . .. . • . .. .. .- ._ - 6. .. 12-inch • • • '. East/west from Occiee--Apopka Road to Ocoee-Clarcona Road at Wurst . . . , . ._.. ,.• .,.. ..-.'" , - Road (2,600.feet); .. . :, . :. .. -... .•.• ... •• .. .• . . .. : • s , . . . . ..„. .. .. .• - • - • 7'. - 12-inch - - North/south along Ocoee-Apopka Road from Palm Drive to West Road • - -.. .• .... .-: .(10,000 feet). - ,.-, . .- - , • . . . : . --- i ... :: - .:••.' . ..- • • . . , . . . . . . . ... • s_. _ . . . ... . . . -.,. .' . . . .,.. .... . .. ..._- . . ,.._ ,.. .. ... ... , . . . . . , s . . . .. .. . ,. ., .... .. . . .,. . .. .. . . . ... . , . . . ., • , . . . • . .. . . .. „ . . . • . , • . . .- • . • . . . • • . . . . . . .. - • - •- • . , . . .. . . . • • . . . . . ••• • • - . . . . . . , . . . , . -: - • . , . .. . . .. .. . . . . . . . . . . . . . . , . . . . . . • "• • , - - •- ' ' . .,.. • . . .:... • . . .. . . . . .. . . . . .. . - • -- . , . . . . . . . . . - • .. . . ., •. - ' • . ... s. . - • • . • TABLE 3-3 (CONT'D) . DISTRIBUTION:SYSTEM.IMPROVEMENTS 8. 12-inch _ East/west along West Road from Ocoee-Apopka.Road to Ocoee-Clarcona Road (3,000 feet) 9... 12-inch North/south from Ocoee-Clarcona.Road to West.Road (1,500 feet) 10. 12-inch ... East/west from`Nicole Boulevard to Clarke Road (south of Hackney Prairie Road) (3,000 feet) • 11. 12-inch East/west along Wurst Road from Ocoee-Clarcona Road to Little Spring Hill Road (1,800 feet) 12. . 12-inch . .. : East/west along Wurst Road from Little Spring Hill Road to Jamela WTP Connection (3,200.feet) • 13. 6-inch North/south from Franklin Street to Palm Drive (1,900 feet) 14. 6-inch East/west along Franklin Street from Western City limits to Silver Star Road (2,700) 15._ 8-inch East/west along Silver Star Road from Silver Bend Boulevard to Ashville Street (1,700 feet)= 16. 12-inch East/west from Blue Spruce Road to Clarke Road (2,000 feet) 17. 12-inch ' North/south from Clarke Road to S.R. 50 (between West Oaks Mall and Lake.Lotta Center) (3,400 feet) 18. 12-inch East/west from Marshall Farms Road to Maine Street (1,300,feet) 19. 12-inch East/west along Maine Street from Bluford Avenue to California Avenue. (4,000 feet) • •20. 12-inch North/south along Blackwood Boulevard from Old Winter Garden Road to Maine Street (2,600 feet) 21. 12-inch . East/west along Maine Street from California Avenue to B.C. Terry Road (2,00Q feet) 22. 8-inch East/west along S.R. 50 west of Richmond (350 feet) 23. 10-inch East/west along S.R. 50 at Old Winter Garden Road (200 feet) -21- _ • • . • TABLE 3-3•(CONT'D): DISTRIBUTION SYSTEM IMPROVEMENTS . - 24. 12-inch. North/south along Marshall Farms Road from Tomyn Road to S.R. :50 :(2,700 feet) - 25. 12-inch East/west along.Torun Road from Marshall Farms Road to Maguire Road . • - (2,800 feet) 26. 12-inch East/west from Maguire Road to South WTP (1,600 feet) . 3.3 Future-Wastewater.Facilities -. .Wastewater flow is-anticipated to increase at an average rate of:approximately 400 additional • ERUs per year.for the next 20 years. ;.At 270 gallons per day (gpd) per,ERU, these 400 ERUs • - .. . • •will produce an additional•108;000:gpd per,year., This•increase in wastewater flow results in • . . •.• an equivalent.increase in:available reclaimeed..water capacity. Table 3-4 shows the wastewater 'flow projections to 2001; It should be noted that the 400 ERUs per year anticipated growth is • an• estimate, and actual annual growth may, vary. In.consideration of this, a.conservative - - estimate-of 350 ERUs per year is.used for.financial.projections: The availability of reclaimed water to customers is also dependent-on the timely planning, development and construction of. - the respective reuse,transmission.and distribution system:. , • TABLE 3-4 •. FUTURE WASTEWATER FLOW PROJECTIONS. :::E.:...::.:...::::::::::::YEAR:IN:.::.;:.::...:::::.:::.: .f::::::::. CONNE....:.:......:.:. )::::.:::,:.::::::::::::.::::::::(.:::.:::::::.::.::::::::.::::::):::::::::::::::::._::: • 1996 , 3,735 • 1;008,500 ... 1997 ; . 4,08 4103,000 1998 4,435 • .1,197,500 1999. .... . .. .. • 4,785 :. . . - .', :1,292,000 2000 5,135 .1,386,500 • 2001• • , . 5,485 . • 1,481,000 ' • -22- 3.4 Future Wastewater Expansions and Upgrades WWTP No. 2 currently has a capacity of 3.0 MGD. This capacity is expected to:be sufficient until the year 2018 with an average increase of 350 ERUs per year. Provisions in the design of this facility allow the capacity to be expanded to 4.0 MGD which will meet wastewater demands well beyond the year 2018. Other planned system expansions are to increase effluent disposal capacity, by supplying reclaimed water to the City. 3.5 Future Wastewater Transmission Facilities Although new development within the sewer service area provides for an approximate increase of 400.ERUs per year and wastewater transmission facilities are installed within,the new developments by the developers, the City has needed to install only between two to three miles of sanitary sewer and forcemain each year for the past several years. This has been accomplished in conjunction with the City's roadway improvement program. New gravity and force mains have been installed in advance of development in potential high growth areas. Since no major wastewater transmission facility construction is planned for 1997, the City anticipates the normal two to three miles of wastewater transmission system installation within the coming year. 3.6 Future Reclaimed Water System and Transmission Facilities The City intends to expand its existing reclaimed water system in 1997. The Forest Lake Golf Course has reached its reclaimed water disposal capacity'(1 MGD). Therefore, the City is pursuing the expansion of its reclaimed water system to accommodate future increasing wastewater effluent flows. . The potential reuse .sites associated with development projects''along the newly. constructed Clarke Road and sites surrounding the .existing reclaimed water site, the Forest Lake Golf Course, are expected to be the earliest sites to develop. The West Oaks Mall (Site No. 24) is currently under construction and will be completed in October of 1996. This development is expected to accelerate other commercial development along Clarke Road and high density multi- family development in the adjacent area. The development of much of the vacant property along Clarke Road is already vested through plans filed with the City Planning Department. Future, land use along the Clarke Road-corridor includes residential and commercial uses. Figure 3-1 depicts the proposed reclaimed water system and reclaimed water service area. -23- ! ------3-- 'I - - I I : - I 1 • LAT —1 1-- :,_-7,.___•••= ._4,,LL:-.ff_-.1.;a-, _ ':-.!-----;, 41 gaelF.- ,..,,t I I L.j 1 _{,. -) J .. . ..,„-___-_-_,-,------- -----.71-- -I- ,_1 -r. i!""'- Lj . flscriaria.n.u.r.frialarai.s1.17.11.17./1,1 g I 1---I L_. . • -- /.._, .----'r-=- .=-_ -_=-____, • _ 1 0 .g __: . . --Ii2(7-11 B eL ' - ----- t______, I---.T.--1 l -IMF. ; L_ ,e ,,-,, 1 1 ...: , I REUSE I: GOLF OUR SE AND 1 „ I '1--:/ , CEMET RY IRRIGATION-----1-1,i ,,•-• -- : 1:;.; : ,e , 1 I -IF-----i_ . 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',;---;,-4-t -,1 •,..:„.7--,.± . //, ; i1..,!irtpq, ,,. ._,.. . . ... , 1 i if 4. - -,-{i-• . . . - -' ------- t 4,1- d • --- - • ' • .. --- _I_--•.1 • ' 0_ .------,_=:„J______,, •- ,-• - •-----1 1:_-__-=-::' - •;°--;-,' °° - - ---- - ,-ii - /; '_i• ,,,_r_.,,,,, I, CITY OF OCOEE J___,_.__-____,__ _r__,,,,-& -_ •_—_,.,---_-.- -,--,--- ----„,„--..--7-- 7_-i.---_-_,T=-",--t- --- -, --- •.i-- --, • ----..,:‘, r,, • ,:.- ,,-1. 1 ,4-•&7,'4]r-,. FUTURE RECLAIMED -' TT- ' . , 1 ":-fi. 1 L ._:. • .w--mrr r:r ..t WATER SYSTEM MAP . T',',..10- i , IM;•- . . 1 ,;',-----..--; LEGEND: ---,. i '---,----:' EXISTING 1011 •. , ::-:- iLT.....:,:‘,L.:: ..%.',ri.II,'.• .: :,,..T_TrITTI-1.11IE I:•••••••-, ' ' ' -,'.......=--1:11 II:1"-:: -1-- i' I : --T-i - PHASE I , - .• .-----.7. — . :'' - j ''' . 11 '-' L-i' litIgH''''jp-Pzzr'Er914,Et-...• ---. . =-•: ----,__,_,...,.. ...., I 0 •PHASE III . - ---.: ,0_____,----, .:i----:-..,--.. . . _! . • ! • : -7---- i-- ..:____.y. • , c ... A PHASE IV : .. r1.1-1.--.:7--:f1'.::*:::::',-,-7-:".:2-1-411-_I--I - -7 .. 11 1 . • ' ':...•.;:771 :-•= I- , • , - • • • . , 1 , 73 ,. ..-rimrntli•-,' •---- ,.. 'I =71 •- ----• --..:::-:: .----- --• ,--.. .--....---.---, . _•.,.._ !-A PECIPROPIESSIONAL agarsorma CONSULTANTS. WC. •••;......, ....-....-• 1 jil.'.)--it',':: '.- • r-r 1-._..4_,'-2;_____ _, - • : :.I 11-1! FIGURE 3.1 • • SECTION 4 RATES AND CHARGES 4.1 Overview The City of Ocoee is a political subdivision of the State of Florida. The City's water and sewer systems are operated and maintained by the Ocoee City Commission through its City Manager, Utility Director and Water and.Sewer Department. The Ocoee City Commission has specific legal authority for acquisition, construction and operation of City-owned water and sewer facilities. The authority is derived from home rule powers granted by the Article VIII of the Florida Constitution, the City Charter, Chapters 163 and 166 of Florida Statutes and other provisions of law. Chapter 22 of the City of Ocoee's Code of Ordinances provides for the modification of City Ordinances related to the water and sewer system. 4.2 Connection Fee Basis For the purpose of this Engineer's Report, the existing water and sewer connection fee schedule was assumed to remain unchanged during the FY96-2001 period with the exception of possible automatic adjustments (authorized by Ordinance 92-19) as a result of capital construction cost index changes as identified in the periodical Engineering News Record (ENR). The current connection fees are based on ERUs. The City has assigned a value of 300 gallons per day per ERU. for water capacity and 270 gallons per day per ERU for sewer capacity.' The existing connection fees were derived using the marginal/incremental or "standards-driven" methodology. This method is based on the recovery of a new customer's proportionate share of the present value of capacity-related capital projects during a base period. The existing connection fee per ERU of incremental water capacity is $966. The connection fee per ERU of incremental sewer capacity is $2,865. The current connection fees for water and sewer were adopted by the City Commission (Ordinance 92-19) and became effective August 18, 1992.` 4.3 Water System Charges The current rate structure is shown in Table 4-1. For purposes of this Engineer's Report, the existing water system charges were assumed to remain unchanged during the FY96-2001-period. The city has the authority to make automatic rate adjustment due to annual increases in the cost of power and chemicals as authorized by Ordinance 92-19. 4.4 . Sewer System Charges The current rate structure is shown in Table 4-1. For the purpose of this Engineer's Report, the existing sewer system charges were assumed to remain unchanged during FY96-2001 period. The City has the authority to make automatic rate adjustment due to annual increases in the cost of power and chemicals as authorized by Ordinance 92-19. -25- • TABLE 4-1 CITY OF OCOEE . EXISTING RATE STRUCTURE WATER Base Facility Charge $ 5/8 inch meter $7.64. 1. inch meter $19:10 1-1/2 inch meter $38.20. 2 inch meter $61.12 3 inch meter $122.24 4 inch meter $191.00, 6 inch meter $382.00 8 inch meter . $611.00 Plus: Volumetric (gallons); charge of $0.51 per 1,000 gallons SEWER Base Facility Charge $ 5/8 inch meter $13.81 1 inch meter. $34.53 1-1/2 inch meter $69.05 2 inch meter $110.48 3 inch meter $220.96. 4 inch meter . $345.25 6 inch meter $690.50 8 inch meter $1,104.80 10.inch.meter $1,588.15 12 inch meter $2,969.15 Plus: Volumetric charge of$1.47 per 1,000 gallons for residential customers with a 5/8 inch-meter up to 12,000 gallons . -26- 4.5 Comparison of Water and Sewer Service Charges with Other Communities The average monthly water and sewer service bill for customers using 10,000 gallons of water per month are $12.74 and $28.51 respectively, for a total cost of $41.25. A comparison is presented in Table 4-2, showing that the City of Ocoee's charges are reasonable when compared to rates from comparably-sized water and sewer utility systems of other publicly-owned entities in Florida. TABLE 4-2 COMPARATIVE WATER AND SEWER SERVICE CHARGES OF 10,000 GALLONS* Titusville 20.55 60.17 80.72 Indian River County 32.70 . 43.98 76.68 Brevard County 19.49 41.93 61.42 Orange County 16.51 42.05 58.56 Daytona Beach 23.21 33.48 56.69 Melbourne 20.76 35.44 56.20 Lake Mary 19.80 35.00 54.80 Sanford 17.14.. . . 35.57 52.71 Cocoa 14.72 34.00 48.72 Casselberry 14.00 34.70 48.70 Oviedo 11.50 36.26 47.76 Kissimmee . 9.51 32.20 41.71 Winter Springs 11.30 36.33 47.63 Orlando 8.93 33.72 42.65 Seminole County 11.70 30.00 41.70 Winter Garden 11.73 26.18 37.91 Apopka 10.25 ' 22.00 ' 32:25 Winter Park 7.75 23.81 31.56. * Water and Sewer rates compared in September 1996. -27- 4.6 Summary of System Charge Schedules The existing water and sewer service charges and other water and sewer revenue sources (connection fees, revenue. and maintenance fees) will provide sufficient funds to meet all operation and maintenance expenses,- existing and proposed debt service coverage requirements on the Series 1992 and 1997 Bonds, renewal and replacement fund deposits, required reserve funds, and reimbursement of administrative expenses for the system to the City of Ocoee's General Fund. The Water and Sewer Capital Connection fees, along with the net proceeds of the Series 1997 Water and Sewer Revenue Bonds, will provide sufficient funding for the expansion of the water and sewer systems to meet the 20-year growth projections. • • -28- • SECTION 5 FINANCIAL PROJECTIONS 5.1 Overview The procedures required to prepare a fiscal evaluation of the City of Ocoee's water and sewer system include a review of: Annual Financial Reports (Audits) Historical Water and Sewer Accounts Historical Operating Expenses Adopted 1996/1997 Budget Projected Growth Rates Projected Operating Expenses Projected Capital Improvements The City of Ocoee collects traditional water and sewer monthly service charges based on water consumption. The City also collects water and sewer capital fees (impact fees) for capital improvements related to expansion of the water and sewer system. The City also collects a monthly revenue and maintenance fee. This fee is paid by developers that have reserved water and sewer capacity and have not used the reserved capacity within one year of reserving capacity. The City has reserved water and sewer capacity for 3,519 ERUs and 3,840 ERUs, respectively. The developers holding reserved water and sewer capacity will pay a total of $780,121 in revenue and maintenance fees in 1997. Developers retaining reserved water and sewer capacity have paid revenue and maintenance fees since 1989. Starting in 1987 the City presold or reserved water and sewer capacity to finance the acquisition of the City's water and wastewater system and provide funds for system expansion. During this period, the City had limited amounts of water and sewer capacity and the development pressure was high in western Orange County. Since the City has expanded the water and sewer system, the need to pre-sell capacity is no longer valid and the City has opted to use conventional financing methods for future expansion of the water and sewer system. Since the presale of capacity is no longer planned, the number of customers paying revenue and maintenance fees is expected to decline as the customers connect to the City's water and sewer system. 5.2 Revenues Historical and projected revenues, expenses and debt service requirements are shown in Table 5-1. In projecting revenues for both water and sewer service, an annual conservative growth rate of 350 new water and sewer ERU's was used. The City has averaged approximately 400 new connections per year since 1992 and expect the number of annual connections to.increase. The City has allocated (pre-sold) 3,519 ERUs of water capacity and 3,840 ERUs of sewer capacity. -29- TABLE 5-1 :>:s:s:i>:»:::>:;<:;g>:iU>:>::<::<::;;;>:a:>:s:i :>>. <M>ib:dE:a:>::a»:>g:>:>:>:<::::s»::::igas:<:MgCYTY la. . TP;'•,SEWE .§).(STEM> M i «ii:Mii > >:i>><>>» > > >; ><:;> is i ; i i.: ' >> ................ ::: �. �� ��'' : liT: ERV.ICE'. �V.ERAGE�:�:�>:<�:�>:�:�>Ez�i>�>?'�>�>i:i>���`:<>>;>:�«'��#:,:� i >��������'�'3::i::_:< :::. ;:• .::.:.; :•._:::::.:: :::.::::::. ::.::::: : : :::::::::.;:HISTORICAL:AND•.PAOYEC:�'ED.REVENUES.AND.EXPENSES.:.AND.DE.:.:5....::....:C�::::,.....;... -:: .:.:......,..::._:::. ... FY 1995 FY 1996 FY 1997 FY 1998 FY 1999 FY 2000 FY 2001 Operating Revenue (Audited) (Estimated) (Projected) (Projected) (Projected) (Projected) (Projected) Water User Fees0t $1,412,636 $1,520,300 $1,609,247 $1,671,942 $1,722,986 $1,774,352 $1,825,718 Water Maint.Fees 0) $329,075 $331,043 $316,043 $297,043 $281,043 $263,043 $246,043 Sewer User Fees0" $1,296,460 $1,377,000 $1,612,314 $1,734,021 $1,831,365 $1,928,709 $2,026,053 Sewer Maint.Fees(I) $479,537 $458,085 $443,085 $424,085 $408,085 $390,085 $373,085 Interest and Misc.Income t't $119,394 $145,000 $40,000 $40,000 $40,000 $40,000 $40,000 Total Operating Revenues $3,637,102 $3,831,428 $4,020,689 $4,167,091 $4,283,479 $4,396,189 $4,510,899 Operating Expense' Water System $1,035,963 S1,190,864 $1,343,515 $1,398,941 $1,454,899 $1,511,272 $1,571,723 Sewer System $878,102 $987,359 $1,229,365 $1,278,540 $1,329,681 $1,382,868 $1,438,183 Total Operating Expenses $1,914,065 $2,178,223 $2,572,880 S2,677,481 $2,784,580 $2,894,140 $3,009,906 Net Revenues $1,723,037 $1,653,205 $1,447,809 $1,489,610 $1,498,899 $1,502,049 $1,500,993 Impact Fees(4) $649,875 $649,875 $649,875 $649,875 $649,875 $649,875 $649,875 Pledged Revenues $2,372,912 $2,303,080 $2,097,684 $2,139,485 $2,148,774 $2,151,924 $2,150,868 Max.Annual Debt Service Series 1993 Bonds $649,875 $649,875 $649,875 $649,875 $649,875 $649,875 ' $649,875 • Series 1997 Bonds0) $0.00 $0 $700,000 $700,000 $700,000 $700,000 $700.000 Total Debt Service $649,875 $649,875 $1,349,875 $1,349,875 $1,349,875 $1,349,875 $1,349,875 Revenues Available for' Admin,R&R and Surplus 1,723,037 1,653,205 747,809 789,610 798,899 802,049 800,993 . Administrative Expense ($406,521) ($400,000) ($400,000) ($400,000) ($400,000) ($400,000) ($400,000) • Funds Available for R&R and Surplus 1,316,516 1,253,205 347,809 389,610 398,899 402,049 400,993 Coverage Net Revs Only 2.65 2.54 1.07 1.10 1.11 1.11 - 1.11 • Coverage w/Impact Fees 3.65 3.54 1.55 1.59 1.59 1.59 1.59 •Projected expenditures are based on 3%annual increase. (')User fees are increased by 350 ERUs/year. Rt Revenue and maintenance fees are reduced by 175 ERUs/year/as a result of pre-sold capacity (3)Interest earned on existing construction fund and investments. (4)Impact fees are increased by 175 new ERUs/year that are above reserve capacity connections. (5)Debt service estimate to be defined at time of bond sale. • (6)No reclaimed fees arc included in the revenue projections. -30- • • The City charges a monthly maintenance fee for the reserved allocation of water and sewer. capacity. The City will bill $328,831 for reserved water capacity and $451,260 for reserved sewer capacity. in 1997 as charges for monthly maintenance fees. Based only on the_reserved water and sewer capacity, the City has pre-sold and reserved ERUs which equals over ten (10) years of projected growth... 5.3 Operating and Maintenance Expenses. The proposed 1996/1997 budget and 1995/.1996'.actual expenditures were used.for projecting future operating and maintenance (0 & M) expenses. To project 0 &:M expenses, an average of three (3)percent annual increase was applied to all expense categories. This annual increase rate is consistent with historical expenses and anticipated personnel expenses. The three (3). percent value is considered sufficient to provide for increases.in both fixed and variable 0 & M expenses. _31- SECTION 6 ORGANIZATIONAL STRUCTURE AND REGULATORY COMPLIANCE 6.1 Organizational Structure The City of Ocoee owns and operates one (1). wastewater treatment plant and three (3) water treatment plants which provide utility service to 9,950 water ERUs and 3701 wastewater ERUs as of September 30, 1996. Under the approved organizational structure, the Utilities Director/City Engineer reports directly to the City Manager. The Utilities Director/City Engineer and the Assistant Utilities Director/Assistant City Engineer are professional engineers registered to practice engineering in the State of Florida. Mr. James W. Shira, P.E. is the Utilities Director/City Engineer and has been with the City of Ocoee since 1989. Mr. David A. Wheeler, P.E. is the Assistant Utilities.Director/Assistant City. Engineer and has been with the City since August 1996. The Assistant Utilities Director is a new position for the City of Ocoee. Mr. Shira will be responsible for both the overseeing of the construction program and management of the water and sewer system. Mr. Shira is supported by other City departments such as the Finance Department, Planning Department, Personnel Department and Public Works. Mr. Robert Holland is the City's Utility Superintendent and has been employed by the City since April 1988. He possesses a Class "A" wastewater license and a Class "C" drinking water license. Mr. David Gosnell is the Chief Water Plant Operator and has been employed by the City since October 1983. He possesses a Class "A" drinking water license. Mr. Fred Ostrander is the City's Chief wastewater plant operator and has been employed by the City since December 1987. He possesses a Class "B" wastewater license and a Class "C" water license. The City has 29 employees in the utility department. Based on our inspection, we are of the opinion that the City's water and sewer system is in good operating condition and is well maintained. PEC representatives inspected the City's water and sewer system in August 1996. The City's wastewater treatment facility is relatively new (constructed in 1994) and much of the wastewater collection system is relatively new due to recent development within the City. The City's water treatment plants are relatively new (South Plant built in 1992) or currently undergoing major expansion (Forest Oak Water Plant). The water distribution system provides adequate service pressure to meet peak flow and fire flow needs. The City has formal preventative maintenance procedures for the water and sewer system. The staffing for the City-owned treatment facilities is in compliance with the Florida Department of Environmental Protection (FDEP) rules and regulations. As the City's water and. sewer system grows, regulatory requirements change, and as the proposed capital improvements are completed, the number of staff positions may increase or be modified to obtain additional personnel with the required technical training and experience. The City's administration has shown a strong awareness of the need to provide continuing personnel growth. It is the opinion • -32- of PEC that the organizational structure and-experience of the City Water and Sewer Department is of sufficient size and quality to adequately serve the City's current and future water and sewer customers. 6.2 Regulatory.Agency Compliance Regulatory requirements for the protection of.public water supplies are mandate d by the Safe Drinking Water Act (SDWA) and the,Florida Administrative Code (FA C). .The City of Ocoee samples its water supply and potable water at required intervals for all permitted parameters under federal and state guidelines. " The.City of Ocoee is currently in full compliance with all federal and state water quality regulations and has had no recent historical problems meeting those regulations:_ Coordination of the use of:water resources in Florida has been performed by five water management districts since :1972. This .function of:water resource. protection includes. the issuance of Consumptive Use Permits (CUPS). The City of Ocoee,falls within the jurisdiction of the St Johns River Water Management District(SJRWMD). The City has recently completed - the renewal,process of its consumptive_use permits for all active..public supply wells and the addition of two new wells, one each at the Forest Oaks and South Water:Treatment Plants. The new consumptive use permits are valid until the year 2006. `General conditions of the CUP include water conservation guidelines and the City is encouraged to maximize the use of reclaimed water in lieu of groundwater supplies. The City's renewed CUP has an increasing allocation adjustment of potable water source based on population projections through the year 2010. No problems are anticipated for continuing the,CUP allocation:in future years as water capacity requirements are.increased. The quality and quantity of wastewater facility effluent discharge is controlled by:the facility operating permits issued by the Florida Department of Environmental Protection .(FDEP). Discharges must meet the restrictions imposed by the Federal.Clean Water Act, Clean Water. Act Amendments and FAC. Wastewater effluent standards are determined by the type of wastewater treatment and type of effluent disposal.method (percolation ponds, reclaimed water irrigation). :The City's wastewater treatment plant,is an advanced secondary treatment facility producing public-access level of effluent for the reclaimed water system. FDEP recently has notified the City of its intent to issue renewal of its wastewater operating permit. This permit is valid through September 20, 2001. The City's facility is in full compliance of current federal and state regulatory requirements. No problems are anticipated for continuing compliance with the operating permit conditions as future customers are added to the system. -33 SECTION 7 • CAPITAL IMPROVEMENT PROGRAM (CIP) 7.1 Background The City of Ocoee is experiencing significant growth throughout the City's water and sewer service area. The City has annexed over two thousand acres of land since 1993 for future residential and commercial development. The 1.2-million-square-foot West Oaks regional shopping mall along Clarke Road will cause significant development of commercial and high density residential growth throughout the City's eastern and southern service area. Due to existing growth and anticipated future growth,. the City's water and sewer facilities must be expanded to meet water and sewer service demands. _In anticipation of the rapid growth, the City has provided long-range planning procedures for expansion of its water and sewer system. Master planning of the City's water, sewer and reuse system has been completed and the City has established a long-range Capital Improvement Plan (CIP) to meet future capacity demands. To ensure future compliance with the City's concurrency management plan, the City has also provided long-range planning analysis of other important services such as transportation, police, fire and recreational facilities. The City.has taken a pro-active planning position to properly prepare for its ongoing growth. 7.2 Water Capital Improvements The City's Water CIP emphasizes the construction of water treatment plant enhancements and expansion of the water distribution system. The water system enhancements are necessary to provide water service to the new growth areas of the City. The water treatment plant construction projects are depicted in Table 3-2. The water distribution system improvements are listed in Table 3-3 and shown in Figure 2-2 (A-D). Section 7.5 contains a summary of the cost estimates for expansion of the City's water treatment and distribution system. These improvements have been identified as necessary to provide water service through the year 2016. The total estimated cost is $4,973,000. 7.3 Wastewater Capital Improvements The total projected wastewater demand for the year 2015 is 2,804,000 MGD. The City's recent expansion of the wastewater treatment facility is expected to provide sufficient wastewater treatment capacity for the twenty (20)year growth period. The City needs to expand its effluent disposal system to match the treatment capacity of the wastewater plant To determine the cost- effective options for expansion of the City effluent disposal system, the City authorized PEC to complete a Reuse Master Plan for the 20-year growth period. -34- The Reuse Master Plan identified an expanded reclaimed water system as cost-effective for effluent disposal. The City requires new developments submitted after August 1995 to install. reclaimed distribution lines within the development in anticipation of the City's expanded reclaimed distribution system. Also described in the Reuse.Master Plan is the initiation of a reclaimed water retrofit program. The purpose of the retrofit program is to provide reclaimed water to existing developments that are adjacent to the major reclaimed water transmission mains. The initial retrofit program will provide reclaimed water to 1,500 existing water and sewer customers along the Clarke Road corridor.- The future reclaimed:water transmission system is depicted in Figure 2-5.` The City.has,also identified the expansion of the existing effluent disposal system at the Forest Lake Golf Course as beneficial: . The City intends to purchase additional undeveloped'acreage :and modify the existing lease with Forest Lake Golf Course to allow private funding to expand the existing 18-hole golf course to a 27-hole golf:course: This proposal allows the City.to provide the property for effluent disposal expansion and the golf course to provide private funding for development of a joint-use effluent facility. The expansion of, the golf course 'effluent system is anticipated to cost $1.,500,000: . The total cost for expansion of the effluent disposal system to provide sufficient disposal capacity for the twenty (20) year growth period is as follows: Reclaimed Water Transmission System $2,790,000 Reclaimed Water Retrofit Program . . . . . . . . . $1,050,000 Effluent Expansion at Golf Course $1.500.000 TOTAL.EFFLUENT DISPOSAL . . . .,.. . . . . .: $5,340,000 - 7.4 Maintenance Facility As the City's water and sewer system is expanded, the need to provide a modern maintenance facility is enhanced. The City has designated a site on the existing wastewater treatment facility _location to provide a centrally located-maintenance facility: The estimated cost of the maintenance facility 7.5 Total Capital Improvement Program (The Project). _ The Project to provide water and sewer service for. the 20-year planning period is as follows: Water Treatment and Distribution Improvements . : . . :$ 4,973,000 Reclaimed Water Program . .. . .. . . . . . . . . . . . . . $ 2,790,000 Reclaimed Water Program (Retrofit) .. . ._. . . . . . $ 1,050,000 Effluent Disposal Expansion : . . . . . . . . $ 1,500,000 Maintenance Facility . . . . . . $ 500,000 TOTAL $10,813,000 -35- . • • 7.5.1 Water Treatment Plant Improvements - Cost Section.3.2 describes the necessary water treatment plant improvements required at the Forest • Oaks and South Water Treatment Plants to allow for continued growth in the City. The costs • associated with these improvements are presented in Table 7-1. TABLE 7-1 WATER TREATMENT PLANT IMPROVEMENTS >:...... T:.OAKS IMPROVEMENTS >><: < SOUT_ :. ..... ...... .. :. . ::::::. ::::. . :::::. ..::::::::::: High Service Pumps $114,000 High Service Pumps $180,000 (3) (5) • Building . 40,000 Flow.Meter • 60,000 Improvements Yard Piping 50,000 Well and Pump 260,000 Control 30,000 Contractor .90,000 • Mobilization Flow Meter ' 10,000 Contingency 108,000 Generator/Power 140,000 Contractor - 77,000 Mobilization Contingency 92,000 TOTAL $553,000 TOTAL • $648,000 • 7.5.2 Water Distribution Facility Improvements - Cost • • Section 3-2 describes the distribution piping improvements to provide for continued growth in the City. The projected cost corresponding to the construction of these improvements is $3,123;000. • 7.5.3 Cost Summary of Potable Water System Improvements Table 7-2 summarizes the Water Treatment Plant and water distribution facility improvements required to expand'with the City's growth population. • • • -36- TABLE 7-2 SUMMARY OF WATER SYSTEM COSTS .FOREST OAKS. • • $ 553,000 SOUTH PLANT 648,000 DISTRIBUTION SYSTEM 3,123,000 ENG/INSP (15%) • 649,000 • TOTAL $4,973,000 7.5.4 Reclaimed Water System Improvements - Cost Table 7-3 presents the Reclaimed Water System improvements and associated costs required to expand the City's system to allow for sufficient wastewater effluent disposal. TABLE 7-3 REUSE SYSTEM IMPROVEMENTS - • STORAGE TANK $800,000 .- PUMP STATION (REUSE) $300,000 LOW LIFT STATION (EFFLUENT) $150,000 DISTRIBUTION SYSTEM $350,000 DESIGN, PERMIT,-INSP $220,000 SUBTOTAL . $1,820,000 DISTRIBUTION SYSTEM $800,000 PUMPS $50,000 DESIGN, PERMIT, INSP $120,000 SUBTOTAL $970,000 . OFIT 1000=:ERU : .1$.:::>:::::.:::: »GOLECOtJRSEEFFLUENT<DISP.OSAL >:> :> ><>' ><`> » >'>::>'><>>:>:»:>>:>'>:>«>><` ......$ . ....... ................... ' 000 �((jEt -37- 7.5.5 Available Funding The City will use existing reserves from the Renewal and Replacement Account and the Water and Sewer Capital (Impact Fees) Account to fund any deficit in available revenues from sale of the Series 1997 Bonds to complete the Project. The City has a fund balance of $1,250,000 in the Renewal and Replacement Account and $1,968,000 in the Capital Account. • -38- SECTION 8 CONCLUSIONS 8.1 Findings of Fact Based on PEC's review of the City of Ocoee's water and sewer system, reviews of master plans and studies performed by PEC, review of the City's Comprehensive Plan, review of the City's financial information concerning the water and sewer system and our recent site visits to the major water and sewer facilities, to the best of our belief, PEC concludes the following: 1. The City's water and sewer system is in good condition and has been operated and maintained in accordance with standard utility industry practices, and provides good, reliable and cost-effective water and sewer service to the customers of the water and sewer system. 2. The City's water and sewer system is operated in compliance with current • Federal, State and local regulatory requirements. All regulatory permits necessary for the operation of the water and sewer system are current (renewal in progress) and in good standing. 3. The Project is necessary and provides water and sewer service for new growth. The average annual growth rate of 350 ERUs is reasonable and valid during the 20-year planning period. The Project is technically sound and conforms to proven and industry accepted engineering practice. The Project will provide for water and sewer system improvements and expansion which will meet Federal, State and local .regulatory requirements and projected growth related water and sewer demands for a twenty (20) year period. 4. The proposed Project is or shall be designed in accordance with accepted engineering standards using proven conventional technology. The proposed improvements have or shall be designed with a high level of sensitivity to concerns held by nearby residents regarding aesthetic issues such as odor control, noise, lighting and utility. 5. The City's management and professional staff are well qualified and certified to manage, operate and maintain the City's water and sewer system. 6. It is reasonable to assume that all required regulatory permits and/or governmental approvals shall be obtained in a timely manner for regulatory compliance and will be obtained prior to construction of the -39- • proposed Project and subsequently all necessary operating permits will be obtained for the completed Capital Improvements. 7. No material charges have occurred in the Project which will have a negative impact on the cost estimate for successful completion of the Project. 8. Proceeds from the Series 1997 Bonds will be sufficient for design, construction and implementation of the Project as described in Section 7. 9. The useful life of the Project is in excess of the weighted life of the Series 1997 Water and Sewer Revenue Bonds. 10. The adopted water and sewer rates are reasonable and sufficient to meet projected system operating expenses, estimate project cost recovery, debt service coverage for Series 1997 bonds and renewal and replacement (R & R) contributions. 11. Based on the analysis and evaluation contained in this report, the capital financing of the City of Ocoee's proposed Project is economically feasible. -40- EXPANSION PERCENTAGE CERTIFICATE I, Kenneth R. Hooper, of Professional Engineering Consultants, Inc. (PEC), DO HEREBY CERTIFY as of the date hereof in connection with the $ City of Ocoee, Florida, Water.and Sewer Revenue Bonds, Series 1997 (the "Bonds") and in connection with the construction of improvements, extensions and additions to the water and sewer systems of the City, as more fully described in the Engineer's Report contained in the Official Statement of the City of Ocoee dated as follows: 1. All capitalized undefined terms used herein shall have the meaning set forth in Resolution No of the City of Ocoee adopted , as amended and supplemental (collectively, the "Resolution"). 2. . We are familiar with the proposed construction by the City of Ocoee of improvements, extensions and additions to the water and sewer systems financed by the proceeds of the Series 1997 Bonds (the "Project"). The Expansion. Percentage of the total PROJECT is %. 3. The estimated total cost of the PROJECT is 4. The estimated cost of the Sewer Expansion Facilities portion of the PROJECT is $ . 5. The Sewer Expansion Percentage is %. 6. The estimated cost of the Water Expansion Facilities portion of the PROJECT is $ . 7. The Water Expansion Percentage is %. Executed this day of 1996. PROFESSIONAL ENGINEERING CONSULTANTS, INC. By: Kenneth R. Hooper • Vice President APPENDIX C COMBINED WATER AND WASTEWATER FUND FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1996 [This page intentionally left blank] FINANCIAL STATEMENTS OF THE WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA FOR THE YEAR ENDED SEPTEMBER 30, 1996 WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA FOR THE YEAR ENDED SEPTEMBER 30, 1996 TABLE OF CONTENTS PAGE NO. INDEPENDENT AUDITOR'S REPORT 1 BALANCE SHEET 2-3 STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS 4 STATEMENT OF CASH FLOWS 5-6 NOTES TO FINANCIAL STATEMENTS 7-18 CDIRMIT AVIS AUTERIA 8z COMPANY, P.A. :: _ CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITOR'S REPORT Honorable Mayor and City Commissioners City of:Ocoee, Florida We have audited the accompanying financial statements of the Water and Wastewater Fund of the City of Ocoee, Florida as of and forthe year ended September 30, 1996 as listed in the table:-of. contents. Theses financial statements are the responsibility of City of Ocoee, Florida management. Our. responsibility. is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates .made :by management,- :as well. as evaluating :the :overall financial .statement presentation. _ We-believe that our,audit provides..a reasonable basis for our opinion. As discussed in Note 1,the financial statements present only the Water and Wastewater Fund . . and are,;not intended to present fairly the financial position of the City of Ocoee, Florida, and the results of its operations and the cash flows of its proprietary fund types and nonexpendable trust funds in.conformity with generally accepted accounting principles. In_our;;opinion, the financial statements referred to in the first paragraph` present.fairly; in all. material respects, the financial .position_ of. the Water and Wastewater.Fund of the City of Ocoee, Florida as of September 30, 1996, and the results of its operations and its cash flows for the year then ended in conformity with.generally accepted accounting:principles. • tut, Doaiw, AtuitwidLa77 �Ply. McDIRMIT, DAVIS, LAUTERIA & COMPANY,_P.A. :. November 6, 1996 612 E.COLONIAL DRIVE•SUITE 350.ORLANDO,FLORIDA 32803-4603•(407)648-0713•FAX(407)839-3975 PRIVATE COMPANIES PRACTICE SECTION•AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS•FLORIDA INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS -1- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA BALANCE SHEET SEPTEMBER 30, 1996. ASSETS Current Assets Cash and Cash Equivalents $ 787,849 Investments 2,505,957 Receivables (Net of Allowance for Uncollectibles). 665,179 Inventory - Materials 22,152 Total Current Assets 3,981,137 Restricted Assets Cash and Cash Equivalents 1,056,487 Cash with Paying Agent 425,027 Investments 2,726,777 Total Restricted Assets • 4,208,291 Fixed Assets Property, Plant and Equipment 33,847,489 Less: Accumulated Depreciation. (7,883,374) Construction in Progress 1,658,990 Total Fixed Assets Net 27,623,105 Other Assets Assessments Receivable- 312,293 Unamortized Bond Issuance Costs r 306,684 Total Other Assets 618.977 TOTAL ASSETS $ 36,431,510 The accompanying notes are an integral part of the financial statements. . -2- • LIABILITIES AND FUND EQUITY Current Liabilities (Payable from Current Assets) Accounts Payable $ 31,834 Accrued Expenses 112,786 Due to Other Funds 1,515 Deferred Revenue 45,726 Obligations under Capital Leases 7,532 Total Current Liabilities (Payable from Current Assets) 199,393 Current Liabilities (Payable from Restricted Assets) Customer Deposits 337,322 Retainage Payable 91,580 • Accrued Interest Payable • 220,027 . Current Portion of Revenue Bonds Payable 205,000 Total Current Liabilities (Payable from Restricted Assets) 853,929 Long-Term Liabilities Revenue Bonds Payable 7,747,373 Obligations Under Capital Lease 29,457 Total Long-Term Liabilities 7,776,830 Total Liabilities 8,830,152 Fund Equity Contributed Capital 23,957,113 Retained Earnings: Reserved for Renewal and Replacement • 1,280,937 Reserved for Debt Service 649,875 Unreserved 1,713,433 Total Retained Earnings 3,644,245 Total Fund Equity 27,601,358 TOTAL LIABILITIES AND FUND EQUITY $ 36,431,510 -3- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS FOR THE YEAR ENDED.SEPTEMBER 30, 1996 Operating Revenues User Charges $ 3,873,669 Operating Expenses Personal Services 1,217,946 Materials and Supplies - 272,318 Heat, Light and Power 298,622 Depreciation and Amortization 1,212,081 Other Expenses 345,494 Total Operating Expenses 3,346,461 Operating Income 527,208 Nonoperating Revenues (Expenses) Interest Revenue 428,158 Interest Expense (391,722) Total Nonoperating Revenues 36,436 Income Before Operating Transfers 563,644 Operating Transfers Operating Transfers In 42,348 Operating Transfers Out (962,339) Net Operating Transfers (919,991 ) Net Income (Loss) $ (356,347) Disposition of Net Income (Loss) Net Income (Loss) $ (356,347) Depreciation on Contributed Assets 350.576 Net Decrease in Retained Earnings :: (5,771 ) Retained Earnings - Beginning of Year :._ 3,650,01.6 Retained Earnings - End of Year $.3,644,245 The accompanying notes are an integral part of the financial statements. -4- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA STATEMENT OF CASH FLOWS FOR THE YEAR ENDED SEPTEMBER30, 1996 Increase (Decrease) in Cash and Cash Equivalents: Cash Flows from Operating Activities: . Receipts from Customers - $ 3,890,524 Payments to Suppliers (818,088) Payments to Employees (1,198,622) Net Cash Provided by Operating Activities 1,873,814 Cash Flows from Noncapital Financing Activities: Net Operating Transfers In (Out) (919,991 ) Decrease In Due From Other Funds 29,610 Increase In Due to Other Funds 1,455 Net Cash Used In Noncapital Financing Activities (888,926) Cash Flows from Capital and Related Financing Activities: Purchase of Property, Plant and Equipment (1,163,161 ) Additions to Construction in Progress (1,197,766) Principal-Paid on Capital Leases (10,506) Interest Paid on Bonds and Leases (452,024) Capital Contributions from Developers and Customers 704,961 Cash Received on Assessments Receivable 53,804 Principal Paid on Bonds " V (200,000) Net Cash Used In Capital and Related Financing Activities V (2,264,692) Cash Flows from Investing Activities: Sale,of Investments 80,230 Interest on Investments 428,158 Net Cash Provided by Investing Activities 508,388 Net Decrease in Cash and Cash Equivalents . (771,416) Cash and Cash Equivalents at Beginning of Year 3,040,779 Cash and Cash Equivalents at End of Year $ 2,269,363, Classified As: Current Assets $ 787,849 Restricted Assets 1,481,514 Total . " ' ' $ 2,269,363, The accompanying notes are an integral part of the financial statements. -5- Reconciliation of Operating Income to Net Cash Provided by Operating Activities:; Operating Income $ 527,208 Adjustments Not Affecting Cash: Depreciation -. 1,197,477 Amortization : 14,604 Provision for Uncollectible Accounts 9,000 Change in Assets and Liabilities: Increase in Accounts Receivable (852) Decrease in Prepaid Costs 3,122 Increase in Accounts Payable 20,702 Increase in Accrued. Expenses- 19,324 Increase in Retainage Payable 65,522 Decrease in Deferred Revenue;-. - .�._ -_: .: :-- . : . :, :. ;.; (23,413) Increase in Customer Deposits 41,120 Total Adjustments 1,346,606 Net Cash Provided by Operating Activities $ 1,873,814. Noncash Investing, Capital, and Financing Activities: Contributed Property, Plant and Equipment $ : 1,097,771 -6- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS . SEPTEMBER 30, 1996 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies of the Water and Wastewater Fund of the City of.Ocoee: Florida, conform to generally accepted accounting principles as applicable tc proprietary funds. The following is a summary of the more significant policies: Reporting Entity The accompanying financial statements include only the Water and Wastewater ,Fund and are not intended to present fairly the financial position of the City o Ocoee, Florida, and the results of its operations and the cash flows of it: proprietary"and: similar trust fund:types in conformity with generally acceptec accounting principles. The Water and Wastewater Fund is an enterprise fund which is a proprietary fund type. Basis of Accounting and Measurement Focus The proprietary fund type measurement focus is upon, determination of capita maintenance (net income, financial position, and changes in financial position) These funds are maintained on l the accrual basis of accounting. Under this method, revenues are recorded when earned and expenses are recorded at thE time liabilities are incurred. The City adopted GASB Statement No: 20-and chosE not to apply all:FASB pronouncements issued after November 30, 1989. Budget An operating budget for the Water. and Wastewater Fund is.legally adopted on ar annual basis in accordance with the bond. indentures. and submitted to thE 'bondholders. Tap and Impact Fees The City of Ocoee collects water and wastewater tap fees which are recorded a: operating revenue only. to the extent that the amount equals the cost of physica connection to the system. Amounts that substantially exceed the cost to connect are recorded as an addition to contributed capital. . Deposits received which reserve capacity.in the City's water and wastewater facilities are recorded as contributed capital.. Other deposits received frorr customers are recorded as liability until all legal requirements, as stipulated by the City's water and wastewater ordinances, are fulfilled. -7- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Cash and Cash Equivalents Cash and cash equivalents include.cash on hand, demand deposits, cash with paying agent, and all highly liquid investments (including restricted assets) with E maturity of ninety days or less when purchased. The Water and Wastewatei Fund's equity in the City of Ocoee's pooled cash (checking) account is includec in cash and cash equivalents. Investments Investments are stated at cost or amortized cost. Income from investments helc by. the Water. and Wastewater Fund is allocated based upon its share of tota investment. Inventories Inventories are stated at cost, using the FIFO. method. Amortization of Bond Discount and Issuance Costs Bond discount and issuance costs are amortized on a straight-line basis, whicl' approximates the interest method, over the life of the bonds. Amortization of bonc issuance costs amounted.to$14,604 for the 1996 fiscal year..Amortization of bonc discount, included in_interest expense, amounted to.$4,887 for the 1996 fiscal year Restricted Assets The use of certain assets of the Water and Wastewater Fund is restricted by _. specific provisions: of bond. resolutions and agreements with 'various parties Assets so designated are identified as restricted assets on the balance sheet. Property, Plant and Equipment Property, plant, and equipment owned by the Water and Wastewater Fund is stated at historical cost-or-estimated historical cost. Additions, improvements, anc other capital outlays that significantly extend the useful life of an. asset arE • capitalized. Other costs incurred for repairs and maintenance are expensed a: incurred. Depreciation of _plant and equipment is provided on the straight linE basis over the following estimated useful lives: Buildings, 10-30 years Improvements, 20-40 years . Equipment, 5-10 years -8- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL.STATEMENTS - CONTINUED SEPTEMBER 30, 1996 .: NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED Property, Plant:and Equipment - Continued Contributions of property, plant, and equipment are recorded at cost provided by the developer which approximates fair market value at the date of, contribution Depredation on contributed property, plant, and equipment is recorded as a re- duction of contributed capital. Postretirement Benefits The Water and_Wastewater Fund does not provide any postretirement health care and life insurance benefits for employees. Capitalization of Interest Net interest cost relating to construction is capitalized. Compensated Absences The Water and Wastewater Fund accrues accumulated unpaid vacation and sick leave when earned by the employee. This liability for compensated absences is reported as a current liability. Fund Equity Contributed capital consists of funds from developers, federal and state (capital; grants and a portion of connection fees charged to customers as previously dis- cussed. Grants received for operating assistance are recorded as non-operating revenue. Reservations of retained earnings are created by increases in assets restricted for debt service, renewal and replacement and other contractual obligations. ThesE increases result from earnings on restricted assets and other intrafund transfer: to (from) restricted accounts. Earnings on 'restricted assets are included in net income of the Water and Wastewater Fund. Reserves are not established for boric proceeds deposited into construction.accounts. • NOTE 2 - STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY. The City has no material violations of finance-related legal and contractual provisions.. • WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 3 CASH AND INVESTMENTS Following_ are the components of the Water and Wastewater Fund's cash anc • investments at September 30, 1996: Unrestricted. Restricted .Total Cash and Cash Equivalents $ . 787,849 $ 1,056,487 $ 1,844,336 Cash with Paying Agent --- 425,027 425,027. Investments . ' . 2,505,957 2,726,777 5,232,734 $ 3,293,806 $ 4,208,291 $ 7,502,097 Deposits In accordance with GASB Statement No. 3, the Water and Wastewater Func deposits are categorized to -give an indication of the level of custodial credit risk assumed at year end.. Category. 1 includes deposits which are insured or collateralized pursuant to the Public Depository Security Act of the State of Florida Category 3 deposits..are uncollateralized, and represent amounts wired to the City's paying agents around September 30 for bond principal and interest payments due on October 1. Bank Balances:. Category 1 • , $ 211,360 Category 3 425,027 Total Bank Balances ' - . $-636,387, Carrying Amount $ 391,900 Investments The City's investment policies are governed by State statutes and City ordinances City ordinance allows investments in any financial institution that is a qualifiec public depository of the State of Florida as identified by the State Treasurer, it accordance with Chapter 280 of the Florida Statutes. Authorized investments are: 1) The State Board of Administration Local Government Surplus Fund Trust Fund: -10- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS = CONTINUED SEPTEMBER 30, 1996 NOTE 3 - CASH AND INVESTMENTS - CONTINUED Investments - Continued 2) U.S. Treasury bills, notes and bonds with maturity dates of 5 years or less; 3) Insured or fully collateralized Certificates of Deposit with maturity date of 3 year: or less with financial institutions qualifying as public depositories; 4) Federal agencies and instrumentalities with maturity date of 5 years or less; 5) Money market funds placed with financial institutions qualifying as public depositories; 6) Securities of any open-end or closed-end management type investment company or investment trust registered under the Investment Company Act o 1940, provided the portfolio of such investment company is limited to U.S Government obligations and to repurchase agreements fully collateralized by such U.S. Government obligations: or 7) Repurchase agreements collateralized by U.S. Treasury Securities or U.S Government Agency securities. The Water and Wastewater Fund's investments are categorized to give ar indication of the level of risk assumed by the City at September 30, 1996: Category 1 includes investments that are insured or registered for which the securities are held by the City or its agent in the City's name. Category 2 includes uninsured and unregistered investments for which thE securities are held by a counterparty's trust department or agent in the City': name. Category 3 includes uninsured and unregistered investments for which the securities are held by the broker or dealer, or by a trust department or agent, but not in the City's name. . . Investments in mutual funds are not required to be categorized since thE investments are not evidenced by securities that exist in physical or book entry form. -11- WATER AND WASTEWATER FUND OF • THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 3'- CASH AND INVESTMENTS - CONTINUED Investments Continued Following is a summary of risk levels'assumed by the City at September 30, 1996: Category Carrying Market 1 2 3 . ' Amount Value Repurchase Agreements $ ---- $ ` --- $1,877,462 .' $1,877,462 $1,877,462 U.S. Government Obligations 1,830,733 --= . --- 1,830,733 1,830,733 $1,830,733 . $ -- - $1,877,462 Mutual Funds Investing In U.S. :3,402,002 3,240,578 Government-.Securities • I$7,110,197 $6,948,773 NOTE 4 -ACCOUNTS RECEIVABLE. . The following is an analysis of Accounts Receivable at September 30, 1996: Water and Wastewater Fees.Receivable . ' .. . . . $ 362,540 Assessments Receivable Current Portion : . ' 60,000 Maintenance Fees (Formerly Guaranteed Revenue) ' 318,639 Total 741,179 Less: Allowance for Uncollectible Accounts (76,000) $ 665,179 Wastewater Assessments Receivable . ,During 1992, the City acquired a wastewater treatment facility serving approximately 250 customers.. In accordance with the acquisition settlement, the City made certair .:wastewater improvements, connected.:the customers ..to its present system anc imposed a connection.charge through.a special assessment. This special assess- ment is due from the customers annually over ten years plus interest at 8%. At Sep- tember 30, 1996, the current and noncurrent assessments receivable are $60,00C and $312,293, respectively. -12- WATER.AND WASTEWATER.FUND OF THE:CITY OF OCOEE FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED , SEPTEMBER 30, 1996 NOTE 5 PROPERTY, PLANT AND EQUIPMENT The.components of property, :plant and equipment at September 30, 1996, are aE .follows: Land $ .4,772,072 Buildings 379,339 Improvements 27;343,689 Equipment 1,402;389 33,847,489 Less: Accumulated Depreciation " (7,883;374) • $25,964,115 Construction in progress'at September 30, 1996, consisted primarily of improvements to water treatment plants, water supply wells and storage tanks. - During the year, the Water and Wastewater Fund capitalized.interest expense or construction in progress in the following amounts: Total Interest Expense Incurred $ 453,312 Interest Associated with Construction Projects: 118,734 Interest,Earned in Construction Accounts • - 57,144 • Net Interest Capitalized 61,590 Interest Expense $ 391,722 NOTE 6 - RETIREMENT PLAN - Defined Benefit Pension Plan and Trust - The City of Ocoee contributes to a single employer defined benefit pension plar and trust. The contribution made by the City of Ocoee is allocated to the Water and Wastewater Fund based on covered payroll of employees whose salaries arE charged to the Water-and:Wastewater Fund: .The Water and Wastewater Fund': payroll for employees covered by the plan for the year ended September 30, 199E was approximately $906,000: The Water and Wastewater Fund's total payroll foi the year ended September 30, 1996 was $906;202.. -13- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 6.-..RETIREMENT PLAN - CONTINUED. All general employees shall become members of this plan as a condition of employment; however., certain employees may_elect not,to be a member of the plan. Benefits fully vest on reaching five years of service. The plan provides death, but not disability benefits. These benefit provisions and all, other require- ments are established by City ordinance. Members of the plan are required,to make regular contributions to the plan in the amount of five percent (5%). of their salary. The City is required to make quarterly contributions to the plan equal to the difference in each year, between the total aggregate member contributions and the total cost as shown by the most recent actuarial valuation of the plan. . 'Information regarding plan asset matters, funding status and progress and contri- butions required and made for the year ended September 30, 1996 by the City of - . - • Ocoee is presented in the Comprehensive Annual. Financial,.Report of the City of Ocoee, Florida for the year ended'September 30, 1996. Deferred Compensation Plan .. The City offers its employees a single employer deferred compensation plan created in accordance with Internal.Revenue Code Section 457. The plan is volun- tary and any.employee may elect to participate. The plan permits.them to defer a portion'of their salary until future years. The deferred compensation is not avail- able to employees until termination,-retirement, death, or an unforeseeable emer- gency: - • .. . Information"regarding the deferred compensation plan for the year ending Sep- tember30, 199.6 is presented in the Comprehensive Annual Financial Report of the City of.Ocoee, Florida. . -14- WATER AND WASTEWATER FUND OF . THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 7 - BONDS PAYABLE Summarized below are the Water and Wastewater Fund's bonds payable outstanding at September 30, 1996: Water'and Sewer System Refunding and Improvement Revenue" Bonds, Series '1996. - payable in annual installments of $105,000 to $610,000 through 2017, plus semi-annual interest at 2.60% to`5.75%. $ 8,055,000 Less: Current Maturities • (205,000) Unamortized Discounts . _ • (102,627) $ 7,747,373 Water and Sewer System Refunding and Improvement Revenue Bonds, Series 1993 In February' 1993,' the City issued Water and Sewer"System Refunding and Improvement Revenue Bonds, Series 1993 to finance the refunding of prior out- standing bonds and improvements to the City's water and wastewater systems. These bonds are secured by the Water and Wastewater Fund operating revenues, interest earnings, impact fees and 'a first priority-pledge, of cash payments due from developers. The major provisions of the ordinances authorizing the revenue bonds are as follows: 1) The City shall make monthly deposits in a sinking fund of 1/12 and 1/6 of the next maturing principal and interest payment, respectively: 2) Each month, provisions shall be made of the gross revenues-sufficient to pay, in order of preference, cost t of operation and maintenance of the.systems, then debt service/sinking fund requirements. 3) The City shall establish rates which will provide for necessary operating expenses and 110%.of the bond service requirement due that year. 4) The City shall establish a Reserve Fund and maintain the Reserve Fund require- ment of $649,875: -15- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 7 - BONDS PAYABLE - CONTINUED During the fiscal year ended September 30, 1996, the City was in compliance with the above provisions. Following is a maturity schedule of outstanding bonds payable: Year Ended Sept. 30: Principal Interest Total 1997 $ 205,000 $ 440,054 $ 645,054 1998 215,000 431,854 646,854 1999 225,000 422,716 647,716 2000 235,000 412,591 647,591 2001 245,000 401,723 646,723 2002-2006 1,425,000 1,811,962 3,236,962 2007-2011 1,855,000 1,380,613 3,235,613 2012-2016. '2,460,000 781,712 3,241,712 2017-2018 1,190,000 103,500 1,293,500 $ 8,055,000 $ 6,186,725 $ 14,241,725 NOTE 8 - CAPITAL LEASE OBLIGATION The Water and Wastewater Fund has entered into a lease agreement as lessee for financing the acquisition of equipment. This lease agreement qualifies as a capital lease for accounting purposes and, therefore, has been recorded at the present value of the future minimum lease payments as of the date of inception. The following is an analysis of equipment leased under capital leases as of September 30, 1996: Equipment $ 43,526 Less Accumulated Amortization (12,332) Net Book Value $ 31,194 Amortization of equipment leased under capital leases is included in depreciation expense. -13- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 8 - CAPITAL LEASE OBLIGATION - CONTINUED The following is a schedule by years of future minimum lease payments under the above capital lease, together with the present value of the net minimum lease pay- ments as of September 30: Year Ending September 30, 1997 $ 11,387 1998 11,387 1999 11,387 2000 11,387 2001 948 Total Minimum Lease Payments 46,496 Less Amount Representing Interest (9,507) Present Value of Net Minimum Lease Payments $ 36,989 The current and long-term obligation under this capital lease is $7,532 and $29,457, respectively. NOTE 9 - DUE TO OTHER FUNDS The amount of$1,515 due to other funds at September 31, 1996 is due to the General Fund. NOTE 10 - CONTRIBUTED CAPITAL The following is a summary of changes in contributed capital during the year ended September 30, 1996: Contributed Capital - Beginning of Year . $ 22,467,044 Additions (Reductions) Connection Fees 742,874 Assets Contributed by Developers . . 1,097,771 Depreciation on Contributed Assets (350,576) Contributed Capital - End of Year $ 23,957,113 -17- WATER AND WASTEWATER FUND OF THE CITY OF OCOEE, FLORIDA NOTES TO FINANCIAL STATEMENTS - CONTINUED SEPTEMBER 30, 1996 NOTE 11 - SUMMARY DISCLOSURE OF SIGNIFICANT CONTINGENCIES Litigation During the ordinary course of its operations, the City of Ocoee is a party to various claims, legal actions, and complaints. In the opinion of the City's management and legal counsel, these matters are not anticipated to have a material financial impact on the Water and Wastewater Fund of the City of Ocoee. Commitments Construction Contracts -At September 30, 1996, the Water and Wastewater Fund had outstanding construction contracts for various projects totaling approximately $802,000. -18- [This page intentionally left blank] APPENDIX D SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION [This page intentionally left blank] - 1 APPENDIX D = SUMMARY OF CERTAIN PROVISIONS OF THE RESOLUTION F This Summary of Certain Provisions of the Resolution is subject in all respects to the .more. complete information:and definitions contained in .Resolution_No. 93-02 adopted. February 2 1993 and Resolution 96-32 adopted: December 3, 1996, as amended and supplemented, and'should not be; considered to be a. complete statement.of the facts material to.making:any investment decision::_. Definitions The following terms shall. have the following meanings, unless the context clearly otherwise requires: Words importing singular number shall include the plural number in each case and vice versa, words importing the masculine gender include every other gender and wordsimporting persons shall include firms and corporations. _ "Act" shall mean Chapter 166, Part II, Florida Statutes, and other applicable provisions of law: "Additional Bonds".shall mean the obligations issued at any time,under the provisions of the Resolution on a..parity with the Series 1993 Bonds, the. Series 1997 Bonds and any other Additional Bonds previously issued. "Additional Project" shall mean the acquisition,.construction or reconstruction of. capital improvements ;to the:System .and .shall -include all property rights, easements, franchises and equipment relating thereto:and deemed necessary or convenient for the con- struction or acquisition or.the operation thereof which are financed in whole or in part with the proceeds of Additional Bonds:, . "AMBAC Indemnity" shall mean the bond insurer for the Series 1997 Bonds. "Amortization Installment"shall mean an amount designated as such by Supplemental Resolution:of the:Issuer-and established with respect to any:Term Bonds. "Authorized Issuer Officer" shall.mean initially the.City Manager and the Director of.Administrative Services as well as any person authorized by resolution of the Issuer to perform such act or sign such document. : "Average Annual Bond Service:;Requirement", means, as of each date of:calculation, the total amount of Bond Service Requirement which is to become: due on all Bonds deemed to.be.Outstanding immediately after such date of calculation divided by the total D-1 .. number of years for which Bonds are deemed to be Outstanding, except that with respect to any Bonds for which Amortization Installments have been established, the amount of principal coming due on the final maturity date with respect to such Bonds shall be reduced by the aggregate principal amount or Compounded Amounts of such Bonds that are to be redeemed from Amortization Installments to be made in prior Bond Years. "Bond Counsel" shall mean a firm of nationally .recognized attorneys at law acceptable to the Issuer and experienced in the issuance of bonds or other debt obligations by governmental units such as the Issuer. - "Bondholder" or "Holder of Bonds" or "holder" or any similar term shall mean any person who shall be the registered owner of any Outstanding Bond. "Bond Service Requirement" shall mean for .a given year the remainder after subtracting any accrued and funded interest for that year that has been deposited into the Debt Service Fund for that purpose from the sum of: (1) The amount required to pay the interest coming due on Bonds during that year; (2) The amount required to pay the principal or Compounded Amounts of Serial Bonds in that year, and the principal or Compounded Amounts of Term Bonds maturing in that year that are not included in the Amortization Installments for such Term Bonds; and (3) The Amortization Installments for all series of Term Bonds for that year. "Bonds" shall mean the Series 1993 Bonds and the Series 1997 Bonds, authorized in the Resolution to be issued and any Additional Bonds issued hereafter. "Business Day" shall mean any day other than a Saturday, Sunday or a day on which banking institutions located in the State of Florida are required or authorized to remain closed. "Capital Appreciation Bonds" shall mean the aggregate principal amount of the Bonds that bear interest payable solely at maturity or upon redemption prior to maturity in the amounts determined by reference to the Compounded Amounts, all as shall be determined by subsequent resolution of the Issuer. "City Engineer" shall mean the City Engineer of the Issuer. "Clerk" shall mean the City Clerk of the Issuer, or such other person as may be duly authorized by the Issuer to act on his or her behalf. - D-2 "Code" shall mean the Internal Revenue Code of 1986, as amended, and the regulations and rules thereunder in effect or proposed: "Compounded Amounts".shall mean, as of the date of computation with respect to any Capital Appreciation Bonds, an amount equal to the principal amount of such Bonds (the principal amount at the date of issuance) plus the interest accrued on such Bonds from the date of original issuance of such Bonds to the interest payment date next preceding the date of computation or the date of computation if an interest payment date, such interest to accrue at an approximate rate per annum of the Capital Appreciation Bonds, as set forth in the Series Resolution or the resolution awarding the sale of such Bonds, compounded on the interest payment dates of each year,plus, with respect to matters related to the payment upon redemption of such Bonds, if such date of computation shall not be an interest payment date, a portion of the difference between the Compounded Amount as of the immediately preceding interest payment date (or the date of original issuance if the date of computation is prior to the first interest payment date succeeding the date of original issuance) and the Compounded Amount as of the immediately succeeding interest payment date, calculated based on the assumption that the Compounded Amount accrued during any period in equal daily amounts on the basis of a year of twelve 30=day months. A table of Compounded Amounts for the Capital Appreciation Bonds shall be incorporated in the resolution awarding the sale of any Capital Appreciation Bonds. "Connection Charges" shall mean the charges imposed on those connecting to the System for the actual cost of physically connecting to the System. "Construction Fund" shall mean the City of Ocoee Water and Sewer System Refunding and Improvement Revenue Bonds Construction Fund-created and established pursuant to the Resolution. "Consulting Engineers" . shall mean one or more independent, qualified and recognized consulting engineer or firm of consulting engineers having favorable repute, skill and experience with respect to the planning and operation of the System who shall be retained from time to time by the Issuer. - "Contributions in Aid of Construction" shall mean any amount or item of money, services, or property received by the Issuer, which represents an addition or transfer to the capital of the Sewer System or the Water System, and which is utilized to offset the acquisition, improvement or construction costs of the Sewer System or the Water System, as applicable. "Cost" when used in connection with a Project, shall mean, to the extent permitted by law, the Issuer's cost of physical construction; (2) costs of acquisition by or for the Issuer of such Project; (3) costs of land and interests therein and the cost of the Issuer incidental to such acquisition; (4) the cost of any indemnity and -surety bonds and premiums for insurance during construction; (5) all interest due to be paid on the Bonds during the D-3 construction period of such Project;and for a reasonable period thereafter;.(6) engineering, legal and other consultant fees and expenses; (7) costs of machinery or.equipment:required by the Issuer for the commencement of operation of.such Project; or (8) any other costs properly attributable..to such construction=.or: acquisition, as determined by :generally accepted accounting:principles and shall include reimbursement to the Issuer.for'any:such items of Cost theretofore paid`:by;the Issuer.in anticipation of the issuance of the Bonds. Any:Supplemental Resolution.of the Issuer:may provide for additional items to be included in the aforesaid Costs., "Cost of Operation and Maintenance" -of the System shall mean the-then current expenses, paid or accrued, in the.operation, maintenance and :repair of the System, as calculated in accordance with generally accepted accounting principles; but shall not include expenses not annually recurring, such as any; reserve: for renewals and replacements, extraordinary repairs or any allowance for depreciation, any:Bond Service Requirement or anypayments in lieu of,taxes._ PY "Current Interest Bonds"shall mean the aggregate principal amount of the.Bonds that bear interest payable -periodically ;on such dates as-shall' be determined by subsequent 'resolution of the Issuer. The Current Interest Bonds include the aggregate principal amount of Serial Current Interest Bonds; and such aggregate principal amount of Term:Current Interest Bonds, as shall be determined by subsequent resolution of the :Issuer.. • "Debt Service Fund" shall mean .the City of. Ocoee Water. -and Sewer System Refunding and Improvement Revenue Bonds Debt Service Fund.created pursuant to the Resolution. "Federal Securities" shall.mean: (A) U.S. Treasury 'Certificates, Notes and Bonds (including State and Local - Government Series -- "SLGS"), (B) Direct obligations of the Treasury which have been_stripped: by the Treasury itself, "CATS," "TIGRS" and similar securities, (C) Interest: on `:obligations of the .Resolution Funding Corporation _ (REF(ORP),_. . (D) Prerefunded municipal bonds rated "Aaa" by Moody's or "AAA" by S&P. If the issue is only rated by S&P (i.e., there is :•rio Moody's. rating), then the prerefunded bonds: must have been prerefunded with cash,: direct U.S. or U.S. guaranteed _obligations, or AAA-rated prerefunded ;municipals. that satisfy- this ' condition, and (E) obligations issued by the following agencies which are backed by the full faith and credit of the U.S.: 1. U.S. Export-Import Bank (Eximbank): Direct obligations or fully guaranteed certificates of beneficial ownership 2. Farmers Home Administration (FmHA): Certificates of beneficial ownership 3. Federal Financing Bank 4. General Services Administration: Participation certificates 5. U.S. Maritime Administration: Guaranteed Title XI financing 6. U.S. Department of Housing and Urban Development (HUD): Project Notes; Local Authority Bonds; New Communities Debentures - U.S. government guaranteed debentures; U.S. Public Housing Notes and Bonds - U.S. government guaranteed public housing notes and bonds "Fiscal Year" shall mean the period commencing on October 1 of each year and continuing through the next succeeding September 30, or such other period designated by the Issuer as its Fiscal Year. "Gross Revenues" or "Revenues" shall mean all income or earnings, including Connection Charges, received by the Issuer or accrued to the Issuer from the ownership,use or operation of the System and all parts thereof, including investment income, if any, earned on any fund or account created pursuant to the Resolution, and on any fund or account established by the Issuer for the System, all as calculated in accordance with generally accepted accounting principles, but "Gross Revenues" or "Revenues" shall not include proceeds from the sale or other disposition of the System or any part thereof, condemnation awards or proceeds of insurance received with respect to the System. Furthermore, "Gross Revenues" or "Revenues" shall not include Sewer System Development Charges or Water System Development charges or Contributions in Aid of Construction. "Initial Project" shall mean the acquisition, construction and erection of certain capital improvements to the System, all as more specifically set forth in the Resolution, including, without limitation, all property rights, appurtenances, easements, franchises and equipment relating thereto and deemed necessary or convenient for the acquisition, construction or erection thereof, in accordance with certain plans on file or to be on file with the Clerk, with such changes, deletions, additions or modifications to the enumerated improvements, equipment and facilities, or such other improvements as approved by the City Commission of the Issuer in accordance with the Act. "Interest Account" shall mean the separate account in the Debt Service Fund established pursuant to the Resolution. "Interest Date" shall be such date or dates for the payment of interest on a Series of Bonds as shall be provided by Supplemental Resolution of the Issuer. D-5 "Issuer" or "City" shall mean the City of Ocoee, Florida. "Maximum Bond Service Requirement" shall mean, as of any particular date of calculation, the greatest amount of aggregate Bond Service Requirement for the then current or any future Bond Year, except.that with respect to any Bonds for which Amortization Installments have been established, the amount of principal coming due on the final maturity date with respect to such Bonds shall be reduced by the aggregate principal amount or Compounded Amounts of such Bonds that are to be redeemed from Amortization Installments, in each case to be made in prior Bond Years. "Maximum Interest Rate" shall mean,.with respect to any particular Variable Rate Bonds, a numerical rate of interest, which shall be set forth in the Supplemental Resolution of the-Issuer delineating the details of such Bonds, that shall be the maximum rate of interest such Bonds may at any time bear in the future in accordance with the terms of such Supplemental Resolution. If no such Maximum Interest Rate is set forth in such Supplemental Resolution, the Maximum Interest Rate with respect to such Variable Rate Bonds shall be deemed to be the maximum rate permitted by law. "Mayor" shall mean the Mayor of the Issuer, or such other person as may be duly authorized by the Issuer to act on his or her behalf. "MBIA" shall mean Municipal Bond Investors Assurance Corporation, insurer of the Series 1993 Bonds. "Net Revenues" of the System shall mean the Gross Revenues, after deduction of the Cost of Operation and Maintenance. "Outstanding" or "Bonds Outstanding" shall mean all Bonds which have been issued pursuant to the Resolution, except: (1) Bonds canceled after purchase in the open market or because of payment at or redemption prior to maturity; (2) Bonds for the payment or redemption of which cash funds or Federal Securities or any combination thereof shall have been theretofore irrevocably set aside in a special account with an escrow agent (whether upon or prior to the maturity or redemption date of any such Bonds) in an amount which, together with earnings on such Federal Securities will be sufficient to pay the principal of and interest on such Bonds at maturity or upon their earlier redemption; provided that, if such Bonds are to be redeemed before the maturity thereof, notice of such redemption shall have been given according to the requirements of the Resolution or irrevocable instructions directing the timely publication of such notice and directing the payment of the principal of and interest on all Bonds at such redemption dates shall have been given to the escrow agent; and D-6 (3) Bonds which are deemed paid pursuant to the Resolution or in lieu of which other Bonds have been issued under the Resolution. "Paying Agent"shall mean any authorized depository designated by the Issuer to serve as a Paying Agent for the Bonds that shall have agreed to arrange for the timely payment of the principal of, interest on and redemption premium, if any, with respect to the Bonds to the owners thereof, from funds made available therefor by the Issuer and any successors designated by subsequent resolution of the Issuer. Nothing in the Resolution shall be deemed to prohibit the Issuer from serving as Paying Agent thereunder or from appointing one or more Paying Agents to serve under the Resolution. "Permitted Investments" shall mean the following, if and to the extent authorized pursuant to the laws of the. State of Florida: A. Direct obligations of the United States of America (including obligations issued or held in book-entry form on the books of,the Department of the Treasury and CATS and TGRS)) or obligations the principal of and interest on which are unconditionally guaranteed by the United States of America. B. Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following federal agencies and provided such obligations are backed by the full faith and credit of the.United States (stripped securities are only permitted if they have been stripped by the agency itself): 1. U.S. Export-Import Bank: Direct obligations or fully guaranteed certificates of beneficial ownership 2. Farmers Home Administration: Certificates of beneficial ownership 3. Federal Financing Bank 4. Federal Housing Administration Debentures 5. General Services Administration: Participation certificates 6. Government National Mortgage Association ("GNMA"): GNMA- guaranteed mortgage-backed bonds; GNMA - guaranteed pass-through obligations 7. U.S. Maritime Administration: Guaranteed Title IX financing 8. U.S. Department of Housing and Urban Development: Project Notes; Local Authority Bonds; New Communities Debentures - U.S. D-7 government guaranteed debentures; U.S. Public Housing Notes and Bonds - U.S. government guaranteed public housing notes and bonds C. Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any of the following U.S. government agencies (non-full faith and credit agencies) (stripped securities are only permitted if they have been stripped by the agency itself): 1. 'Federal Home Loan Bank System: Senior debt obligations 2. Federal Home Loan Mortgage Corporation (FHLMC): Partic- ipation Certificates; Senior debt obligations 3. Federal National Mortgage Association: Mortgage-backed securities and senior debt obligations 4. Student Loan Marketing Association: Senior debt obligations 5. Resolution Funding Corp. (REFCORP) obligations 6. Farm Credit System: Consolidated systemwide bonds and notes D. Money market funds registered under the Federal Investment Company Act of 1940, whose shares are registered under the Federal Securities Act of 1933, and having a rating by S&P of AAAm-G;_AAAm; or AAm. E. Certificates of deposit secured at all times by collateral described in A and/or B above. Such certificates must be issued by commercial banks, savings and loan associations or mutual savings banks. The collateral must be held by a third party and the bondholders must have a perfected first security interest in the collateral. F. Certificates of-deposit, savings accounts, deposit accounts or money market deposits which are fully insured by Federal Deposit Insurance Corporation or Federal Savings and Loan Insurance Corporation. . G. Investment Agreements,- including guaranteed investment contracts, acceptable to MBIA. H. Commercial paper rated,.at the time of purchase, "Prime - 1" by Moody's or-"A-1" or better by S&P. D-8 I. Bonds or notes issued by any state or municipality which are rated by Moody's and S&P in one of the two highest rating categories assigned by such agencies. J. Federal funds or bankers' acceptances with a maximum term of one year of any bank which has an unsecured, uninsured and unguaranteed obligation rating of "Prime - 1" or "A3" or better by Moody's and "A-1" or "A" or better by S&P. K. Repurchase agreements that provide for the transfer of securities from a dealer bank or securities firm(seller/borrower) to a municipal entity(buyer/lender), and the transfer of cash from a municipal entity to the dealer bank or securities firm with an agreement that the dealer bank or securities firm will repay the cash plus a yield to the municipal entity in exchange for the securities at a specified date. Repurchase Agreements must satisfy the following criteria or be approved by MBIA: 1. Repurchase agreements must be between the municipal entity and a dealer bank or securities firm a. Primary dealers on the Federal Reserve reporting dealer list, or b. Banks rated "A" or above by S&P and Moody's. 2. The written repurchase agreement must include the following: a. Securities which are acceptable for transfer are: (i) Direct U.S. governments, or (ii) Federal agencies backed by the full faith and credit of the U.S. government b. The term of the repurchase agreement may be up to 30 days c. The collateral must be delivered to the municipal entity, trustee (if trustee is not supplying the collateral) or third party acting as agent for the trustee (if the trustee is supplying the collateral) before/simultaneous with payment (perfection by possession of certificated securities). D-9 d. Valuation of Collateral (i) The securities must be valued weekly, marked-to-market at current market price plus accrued interest (A) The value of collateral must be equal to 104% of the amount of cash transferred by the municipal entity to the dealer bank or security firm under the repurchase agreement plus accrued interest. If the value of securities held as collateral slips below 104% of the value of the cash transferred by municipality, then additional cash and/or acceptable securi- ties must be transferred. If, however, the securities used as collateral are FNMA or FHLMC, then the value of the collateral must equal 105%. Securities on deposit in each subaccount in the Reserve Account shall be valued as determined by the resolution of the Issuer authorizing the series of Bonds for which such subaccount was established. 3. A legal opinion must be delivered to the municipal entity to the effect that the repurchase agreement meets guidelines under state law for legal investment of public funds. L. Units of participation in the Local Government Surplus Funds Trust Fund established pursuant to Chapter 218, Part IV, Florida Statutes, or any similar common trust fund which is established pursuant to the laws of the State of Florida as a legal depository of public moneys and for which the Florida State Board of Administration acts as custodian; and M. Any other investment permitted under applicable Florida and United States law and acceptable to MBIA, for so long as the Series 1993 Bonds shall be Outstanding and such firm shall not be in default under its policy of municipal bond insurance securing such Series 1993 Bonds. "Person" shall mean an individual, a corporation, a partnership, an association, a joint stock company, a trust, any unincorporated organization or governmental entity. "Pledged Funds" shall mean (1) the Net Revenues of the System, (2) the Sewer System Development Charges but only to the extent of the Sewer System Development Charges Bond Service Component, (3) the Water System Development Charges but only to the extent of the Water System Development Charges Bond Service Component, and (4) until applied in accordance with the provisions of the Resolution, all moneys, including ' investments thereof, in the funds and accounts established thereunder (except the Rebate Fund and except to the extent otherwise provided in Sections 4.06 and 4.07 thereof). D-10 "Policy" shall mean the municipal bond insurance policy issued by MBIA insuring the Series 1993 Bonds, and the municipal bond insurance policy issued by AMBAC Indemnity with respect to the Series 1997 Bonds. "Project" shall mean, as applicable, the Initial Project and any Additional Project. "Project Certificate" shall mean that certificate of the Qualified Independent Consultant filed with the Issuer at or prior to the delivery of any Series of Bonds setting forth (i) the estimated total cost of the Project or Projects, if any, (ii) the estimated cost of the Sewer Expansion Facilities portion of the Project or Projects, if any, and (iii) the estimated cost of the Water Expansion Facilities Portion of the Project or Projects, if any. "Prudent Utility Practice" shall mean, in respect of any particular utility industry, any of the practices, methods and acts which, in the exercise of reasonable judgment, in the light of the facts, including but not limited to the practices, methods and acts engaged in or approved by a significant portion of such utility industry prior thereto, known at the time such decision was made, would have been expected to accomplish the desired result at the lowest reasonable cost consistent with reliability, safety and expedition. It is recognized that Prudent Utility Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather is a spectrum of possible practices, methods or acts which could have been expected to accomplish the desired result at the lowest reasonable cost consistent with reliability, safety and expedition. "Qualified Independent Consultant" shall mean one or more qualified and recognized independent consultants, having favorable repute, skill and experience with respect to the duties of the Qualified Independent Consultant to be provided to the Issuer, as shall from time to time be retained by the Issuer to perform the acts and carry out the duties provided in the Resolution for such consultants. "Rebate Fund" shall mean the City of Ocoee Water and Sewer System Refunding and Improvement Revenue Bonds Rebate Fund established pursuant to the Resolution. "Record Date" shall have the same meanings as set forth in the Resolution. "Redemption Account" shall mean the special account of the same name created within the Debt Service Fund. "Redemption Price" shall mean with respect to any Bond or portion thereof, the principal amount or portion thereof, plus the applicable premium, if any, payable upon redemption thereof pursuant to such Bond or the Resolution. "Registrar" shall mean a trust company or bank with trust powers appointed by subsequent resolution of the Issuer to serve as Registrar pursuant to the Resolution and any successors designated by subsequent resolution of the Issuer. Nothing in the Resolution D-11 • shall be deemed to prohibit the Issuer from serving as .Registrar thereunder or from appointing one or more Registrars to serve under the Resolution. "Reserve Fund" shall mean the Reserve Fund created in the Resolution and all accounts therein. "Reserve Requirement" with respect to each Series of Bonds, if any, shall be determined by subsequent resolution of the Issuer adopted prior to the issuance of each such Series of Bonds, but shall not exceed the lesser of(i) Maximum Debt Service Require- ment, (ii) one and one-quarter times the Average Annual Debt Service Requirement or (iii) except with respect.to Taxable Bonds, such amount as will not adversely affect the exclusion of interest on the Bonds from the gross income of the holders of the Bonds for purposes of federal income taxation. The Reserve Requirement for the Series 1993 Bonds shall be the lesser of(i) the Maximum Debt Service Requirement on the Series 1993 Bonds, (ii) one and one-quarter times the Average Annual Debt Service Requirement on the Series 1993 Bonds or (iii) such amount as will not adversely affect the exclusion of interest on the Series 1993 Bonds from the gross income of the holders of the Series 1993 Bonds for purposes of federal income taxation. "Resolution" shall mean Resolution No. 93-02 adopted February 2, 1993 and Resolution No. 96-32 adopted December 3, 1996, as the same may from time to time be amended, modified or supplemented by Supplemental Resolution. "Revenue Fund" shall mean the City of Ocoee Water and Sewer System Refunding and Improvement Revenue Bonds Revenue Fund established pursuant to the Resolution. "Serial Bonds" shall mean all of the Bonds other than Term Bonds. "Serial Current Interest Bonds"shall mean the aggregate principal amount of Current Interest Bonds maturing on such dates and in such amounts as shall be determined by subsequent resolution of the Issuer and for which Amortization Installments have not been designated. "Series" shall mean all the Bonds delivered on original issuance in a simultaneous transaction and identified pursuant to the Resolution or a Supplemental Resolution autho- rizing the issuance by the Issuer of such Bonds as a separate Series, regardless of variations in maturity, interest rate, Amortization Installments or other provisions. "Series 1993 Bonds" shall mean the City of Ocoee, Florida, Water and Sewer System Refunding and Improvement Revenue Bonds, Series 1993, initially issued under the Resolution, which may be issued in one or more Series. D-12 "Series 1997 Bonds" shall mean the City of Ocoee, Florida, Water and Sewer System Improvement Revenue Bonds, Series 1997, initially issued under the Resolution, which may be issued in one or more Series. "Sewer Expansion Facilities" shall mean improvements, extensions and additions to the Sewer System, together with all lands or interest therein, including plants, buildings, machinery, franchises, pipes, mains, fixtures, equipment and all property real or personal, tangible or intangible, heretofore or hereafter constructed or acquired in order to meet the increased demand upon the Sewer System, whether actual or anticipated, created by new users connecting to the Sewer System. "Sewer Expansion Percentage" shall mean that number, expressed as a percentage, which represents that portion of the total cost of any Project or Projects financed from the proceeds of a particular Series of Bonds which is attributable to Sewer Expansion Facilities, if any, as shall be determined by the Qualified Independent Consultant and set forth in the Project Certificate. "Sewer System" shall mean the complete sewer system now owned, operated and maintained by the Issuer, together with any and all improvements, extensions and additions thereto hereafter constructed or acquired, together with all lands or interests therein, including plants, buildings, machinery, franchises, pipes, mains, fixtures, equipment and all property, real or personal, tangible or intangible, now or hereafter. used in connection therewith. "Sewer System Development Charges"shall mean the impact fees and capital charges levied upon and collected from new users of the Sewer System (or the proceeds of any security provided for the payment thereof), if any, to the extent the same are lawfully available for the acquisition and construction of Sewer Expansion Facilities and for Sewer System Development Charges Bond Service Component. Sewer System Development Charges do not include Connection Charges. "Sewer System Development Charges Bond Service Component" shall mean with respect to any Series of Bonds as of any particular date of calculation, the Sewer Expansion Percentage, if any, multiplied by the Bond Service Requirement for said Series of Bonds. "Sewer System Development Charges Fund" shall mean the "City of Ocoee Sewer System Development Charges Fund" created pursuant to the Resolution. "Subordinated Indebtedness" shall mean that indebtedness of the Issuer, subordinate and junior to the Bonds, issued in accordance with the provisions of the Resolution. "Supplemental Resolution" shall mean any Resolution of the Issuer amending or supplementing the Resolution adopted and becoming effective in accordance with the terms of the Resolution. D-13 "System" shall mean collectively the Water System.and the Sewer System. "Taxable Bond" shall mean any Bond which states in the. body thereof that the interest income thereon is includable in the gross income of the holder thereof for federal income tax purposes or that such interest is subject to federal income taxation. "Term Bonds shall mean Term Current Interest Bonds and Term Capital Appreciation Bonds. "Term Capital Appreciation Bonds" shall mean the aggregate principal amount of Capital Appreciation Bonds maturing on such dates and in such amounts as shall be determined by subsequent resolution of the Issuer and for which Amortization Installments have been.designated. "Term Current Interest Bonds"shall mean the aggregate principal amount of Current Interest Bonds maturing on such dates and in such amounts as shall be determined by subsequent resolution of the Issuer and for which Amortization Installments have been designated. . "Variable Rate Bonds" , shall mean Bonds issued with a variable, adjustable, convertible or other similar rate which is not fixed in percentage for the entire term thereof at the date of issue. "Water Expansion Facilities" shall mean improvements, extensions and additions to the Water System, together with all lands or interest therein, including plants, buildings, machinery, franchises, pipes, mains, fixtures, equipment and all property real or personal, tangible or intangible, heretofore or hereafter constructed or acquired in order to meet the increased demand upon the Water System, whether actual or anticipated,_created by new users connecting to the Water System. , . . "Water Expansion Percentage" shall mean that number, expressed as a percentage, which represents that portion of the total cost of any Project or Projects financed with the proceeds of any particular Series of Bonds which is attributable to Water Expansion Facilities, if any, as. shall be determined by the Qualified Independent Consultant and set forth in the Project Certificate. "Water System" shall mean the complete water system now owned, operated and maintained by the Issuer, together with any and all improvements, extensions and additions thereto hereafter constructed or acquired, together with all lands or interests therein, including plants, buildings, machinery, franchises, pipes, mains, fixtures, equipments and all property, real or personal, tangible or intangible, now or hereafter used in connection . therewith. . . D-14 "Water System Development Charges" shall mean the impact fees and capital charges levied upon and collected from new users of the Water System (or the proceeds of any security provided for the payment thereof), if any, to the extent the same are lawfully available for the acquisition and construction of Water Expansion Facilities and for Water System Development Charges Bond Service Component. Water System Development Charges do not include Connection Charges. "Water System Development Charges Bond Service Component" shall mean with respect to any Series of Bonds as of any particular date of calculation, the Water Expansion Percentage, if any, multiplied by the Bond Service Requirement for said Series of Bonds. "Water System Development Charges Fund" shall mean the "City of Ocoee Water System Development Charges Fund" created pursuant to the Resolution. Resolution to Constitute Contract In consideration of the purchase and acceptance of any or all of the Bonds by those who shall hold the same from time to time, the provisions of the Resolution shall be a part of the contract of the Issuer with the Holders of the Bonds and shall be deemed to be and shall constitute a contract between the Issuer and the Holders from time to time of the Bonds. The pledge made in the Resolution and the provisions, covenants and agreements therein set forth to be performed by or on behalf of the Issuer shall be for the equal benefit, protection and security of the Holders of any and all of said Bonds. All of the Bonds, regardless of the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof except as expressly provided in or pursuant to the Resolution. Authorization of Project and Refunding of Refunded Bonds Pursuant to the Resolution, the Issuer authorized the acquisition, construction and erection of the Initial Project and the refunding of the Refunded Bonds. Application of Series 1997 Bond Proceeds The proceeds derived from the sale of the Series 1997 Bonds, including accrued interest and premium, if any, shall, simultaneously with the delivery of the Series 1997 Bonds to the purchaser or purchasers thereof, be applied by the Issuer as follows: (A) Accrued interest, if any, shall be deposited in the Interest Account and shall be used only for the purpose of paying the interest which shall thereafter become due on the Series 1997 Bonds. D-15 (B) A sufficient amount of the Series 1993 Bond proceeds shall be applied to the payment of reasonable and necessary costs and expenses relating to delivery of the Series 1997 Bonds. (C) An amount for the construction of the Project to the.Construction Fund. (D) Unless otherwise provided in a Supplemental Resolution of the Issuer, the purchase of municipal surety bond policy for sum equal to the Reserve Requirement for the Series 1997 Bonds shall be deposited in an account in the Reserve Fund for the benefit of the Series 1997 Bonds. . The proceeds of, any other Series of Bonds shall .be applied as provided by Supplemental Resolution of the Issuer. Execution of Bonds . The Series 1997 Bonds shall be signed by, or bear the facsimile signature of, the Mayor and shall be signed by, or bear the facsimile signature of, the Clerk and a facsimile of the official seal of the Issuer shall be imprinted on the Bonds. In case any officer whose signature or a facsimile of whose signature shall appear on any Series 1997 Bond shall cease to be such officer before the delivery of such Series 1997 Bond, such signature or such facsimile shall nevertheless be valid and sufficient for all purposes the same as if he has remained in office until such delivery. Any Series 1997 Bond may bear the facsimile signature of or may be signed by such persons who, at the actual time of the execution of such Series 1997 Bond, shall be the proper officers to sign. such Series 1997 Bond although at the date of such Series 1997 Bond such persons may not have been such officers. Authentication Only such of the Series 1997 Bonds as shall have endorsed thereon a certificate of authentication substantially in the form set forth.in the Resolution, duly executed by the Registrar, as authenticating agent, shall be entitled to any benefit or security under the Resolution. No Series 1997 Bond shall be valid or obligatory for any purpose unless and until such certificate.of authentication shall.have been duly executed by the Registrar, and such certificate of the Registrar upon any such Series 1997 Bond shall be conclusive evidence that such Series 1997 Bond has been duly authenticated and delivered under the Resolution. The Registrar's certificate of authentication on any Series 1997 Bond shall be deemed to have been duly executed if signed by an authorized officer of the Registrar, but it shall not be necessary that the same officer sign the certificate of authentication of all of the Series 1997 Bonds that may be issued under the Resolution at any one time. D-16 Temporary Bonds Until the definitive Bonds of any Series are prepared, the Issuer may execute, in the same manner as is provided in the Resolution, and deliver, upon authentication by the Registrar pursuant to the Resolution, in lieu of definitive Bonds, but subject to the same provisions,limitations and conditions as the definitive Bonds, except as to the denominations thereof, one or more temporary Bonds substantially of the tenor of the definitive Bonds in lieu of which such temporary Bond or Bonds are issued, in denominations authorized by the Issuer by subsequent Resolution, and with such omissions, insertions and variations as may be appropriate to temporary Bonds. The Issuer, at its own expense, shall prepare and execute definitive Bonds,which shall be authenticated by the Registrar. Upon the surrender of such temporary Bonds for exchange, the Registrar, without charge to the Holder thereof, shall deliver in exchange therefor definitive Bonds, of the same aggregate principal amount and Series and maturity as the temporary Bonds surrendered. Until so exchanged, the temporary Bonds shall in all respects be entitled to the same benefits and security as definitive Bonds issued pursuant to the Resolution. All temporary Bonds surrendered in exchange for another temporary Bond or Bonds or for a definitive Bond or Bonds shall be forthwith canceled by the Registrar. Bonds Mutilated, Destroyed, Stolen or Lost In case any Bond shall become mutilated, or be destroyed, stolen or lost, the Issuer may, in its discretion, issue and deliver, and the Registrar shall authenticate, a new Bond of like tenor as the Bond so mutilated, destroyed, stolen or lost, in exchange and substitution for such mutilated Bond upon surrender and cancellation of such mutilated Bond or in lieu of and substitution for the Bond destroyed, stolen or lost, and upon the Holder furnishing the Issuer and the Registrar proof of such Holder's ownership thereof and satisfactory indemnity and complying with such other reasonable regulations and conditions as the Issuer or the Registrar may prescribe and paying such expenses as the Issuer and the Registrar may incur. All Bonds so surrendered or otherwise substituted shall be canceled by the Registrar. If any of the Bonds shall have matured or be about to mature, instead of issuing a substitute Bond, the Issuer may pay the same or cause the Bond to be paid, upon being indemnified as aforesaid, and if such Bonds be lost, stolen or destroyed, without surrender thereof. Any such duplicate Bonds issued pursuant to the Resolution shall constitute original, additional contractual obligations on the part of the Issuer whether or not the lost, stolen or destroyed Bond be at any time found by anyone, and such duplicate Bond shall be entitled to equal and proportionate benefits and rights as to lien on the Pledged Funds to the same extent as all other Bonds issued thereunder. Transfer Bonds,upon surrender thereof at the office of the Registrar with a written instrument of transfer satisfactory to the Registrar, duly executed by the Holder thereof or such D-17 Holder's attorney duly authorized in writing, may, at the option of the Holder thereof, be exchanged for an equal aggregate principal amount of registered Bonds of the same type and maturity of the Bonds so surrendered. The Bonds issued under the Resolution shall be and have .all the qualities and incidents of negotiable instruments under the law merchant and the Uniform Commercial Code of the State of Florida, subject to the provisions for registration and transfer contained in the Resolution and in the Bonds. So long as any of the Bonds shall remain Outstanding, the Issuer shall maintain and keep, at the office of the Registrar, books for the.registration and transfer of the Bonds. Each Bond shall be transferable only upon the books of the Issuer, at the office of the Registrar, under such reasonable regulations,as the Issuer may prescribe,,by the Holder thereof in person or by such Holder's. attorney duly authorized in writing upon surrender thereof together with a written instrument of transfer satisfactory,,.to the Registrar duly executed and guaranteed by the Holder or such Holder's duly authorized attorney. Upon the transfer of any such Bond, the Issuer shall issue, and cause to be authenticated, in the name of the transferee a new Bond or Bonds of the same aggregate principal amount and Series and maturity as the surrendered Bond. The Issuer, the Registrar and any Paying Agent or fiduciary of the Issuer may deem and treat the Person in whose name any Outstanding Bond shall be registered upon the books of the Issuer as the absolute owner of.such.Bond, whether such Bond shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal or Redemption Price, if applicable, and interest on such Bond and,for all other purposes, and all such payments so made to any such Holder or upon such Holder's order shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid and neither,the Issuer nor the Registrar nor any Paying Agent or other fiduciary of the Issuer shall be affected by any notice to the contrary. The Registrar, in,any case where it is not also the Paying Agent in respect to any Series of Bonds, forthwith (A) following the fifteenth day prior to an interest payment date for such Series; (B) following the fifteenth day next preceding the date of first mailing of notice of redemption of any Bonds of such Series; and (C) at any other time as reasonably requested by the Paying Agent of such Series, shall certify and furnish to such Paying Agent the names, addresses and holdings of Bondholders and any other relevant information reflected in the registration books. Any Paying Agent of any fully registered Bond shall effect payment of interest on such Bonds by mailing a check or draft to the Holder entitled thereto or may, in lieu thereof, upon the request and at the expense of_such Holder, transmit such payment by bank wire transfer for the account of such Holder. In all cases in which the privilege of exchanging Bonds or transferring Bonds is exercised, the Issuer shall execute and the Registrar shall authenticate and deliver such Bonds in accordance with the provisions of the Resolution. Execution of Bonds by the Mayor and the Clerk for purposes of exchanging, replacing or transferring Bonds may occur D-18 at the time of the original delivery of the Series of which such Bonds are a part. All Bonds surrendered in any such exchanges or transfers shall be held by the Registrar in safekeeping until directed by the Issuer to be canceled by the Registrar. For every such exchange or transfer of Bonds, the Issuer or the Registrar may make a charge sufficient to reimburse it for any tax, fee, expense or other governmental charge required to be paid with respect to such exchange or transfer. The Issuer and the Registrar shall not be obligated to make any such exchange or transfer of Bonds of any Series during the fifteen (15) days next preceding an Interest Date on the Bonds of such Series, or, in the case of any proposed redemption of Bonds of such Series, then during the fifteen (15) days next preceding the date of the first mailing of notice of such redemption and continuing until such redemption date. Coupon Bonds The Issuer, at its discretion, may by Supplemental Resolution authorize the issuance of coupon Bonds, registrable as to principal only or as to both principal and interest. Such Supplemental Resolution shall provide for the negotiability, transfer, interchangeability, denominations and form of such Bonds and coupons appertaining thereto. Coupon Bonds (other than Taxable Bonds) shall only be issued if an opinion of Bond Counsel is received to the effect that issuance of such coupon Bonds will not adversely affect the exclusion from gross income of interest earned on such Bonds for federal income tax purposes. Notice of Redemption All notices of redemption shall specify the Bond or Bonds (or portions thereof) to be redeemed, and the date and place for redemption, shall be given by the Registrar on behalf of the Issuer, and (i) shall be filed with the Paying Agent for such Bonds, (ii) shall be mailed by first class mail, postage prepaid, at least thirty days and not more than sixty days before the proposed redemption date to all Holders of Bonds to be redeemed at their addresses as they appear on the registration books kept by the Registrar as of fifteen days before the mailing date, and (iii) shall be mailed by registered or certified mail, postage prepaid, or by telecopy or facsimile transmission at least thirty-five days before the redemption date to the registered securities depositaries and two or more nationally recognized municipal bond information services. Failure to mail notice to the Holders of Bonds to be redeemed; or any securities depositaries or any defect therein, shall not affect the validity of the proceedings of redemption of such Bonds as to which no such failure or defect has occurred. Notice of any optional redemption of Bonds shall be given only upon the prior deposit into the Redemption Account of amounts sufficient to pay the principal or Compounded Amount of, interest accrued from the last interest payment date to the pro- posed redemption date on Current Interest Bonds, and premium, if any, with respect to the Bonds to be redeemed. Each redemption notice shall state: (i) the CUSIP numbers of all Bonds being redeemed, (ii) the original issue date of such Bonds, (iii) the maturity date and rate of interest borne by each Bond being redeemed, (iv) the redemption price, (v) the date on D-19 which such notice is mailed, (vi) if less than all Outstanding Bonds are to be redeemed, the certificate number (and, in the case of a partial redemption of any Bond, the principal amount or Compounded Amount of each Bond to be redeemed; (vii) that on the redemption date there shall become due and payable upon each Bonds to be redeemed the redemption price thereof, or the redemption price of the specified portions of the principal amount or Compounded Amount thereof in the case of Bonds to be redeemed in part only, together with interest accrued on Current Interest Bonds to the redemption date, and that from and after such date interest thereon shall cease to accrue or value shall cease to accrete and be payable; (viii) that the Bonds to be redeemed, whether as a whole or in part, are to be surrendered for payment of the redemption price and accrued interest, if any, at the principal office of the Registrar at an address specified; and (ix) the name and telephone number of a person designated by the Registrar to be responsible for such redemption. When notice of redemption is given, Bonds called for redemption will become due and payable on the redemption date at the redemption price stated in such notice. When a notice of redemption is given and funds sufficient for redemption are deposited with the Registrar, interest on the Bonds to be redeemed will cease to accrue on the date fixed for redemption, such Bonds shall cease to be entitled to any lien, benefit or security under the Resolution and the Holders of such Bonds will have no right in respect thereof except to receive payment of the redemption price plus interest accrued to the redemption date. Upon surrender of any Bond for redemption in part only, 'the Registrar shall authenticate and deliver to the Bondholder thereof, the cost of which shall be paid by the Issuer, a new Bond of an authorized denomination equal to the unredeemed portion of the Bond surrendered. Bonds not to be Indebtedness of Issuer The Bonds shall not be or constitute general obligations or indebtedness of the Issuer as."bonds" within the meaning of any constitutional or statutory provision, but shall be special obligations of the Issuer, payable solely from and secured by a lien upon and pledge of the Pledged Funds. No Holder of any Bond shall ever have the right to compel the exercise of any ad valorem taxing power to pay such Bond, or be entitled to payment of such Bond from any moneys of the Issuer except from the Pledged Funds in the manner provided in the Resolution. The Pledged Funds shall be trust funds held by the Finance Director or such other person as shall be designated by the City Commission and shall immediately be subject to the lien of this pledge without.any physical delivery thereof or further act, and the lien of this pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the Issuer. D-20 Security for Bonds The payment of the principal of or Redemption Price, if applicable, and interest on the Bonds shall be secured forthwith equally and ratably, except to the extent provided in the Resolution, by a pledge of and lien upon the Pledged Funds. Under the Resolution, the Issuer irrevocably pledges the Pledged Funds to the payment of the principal of or Redemption Price,if applicable, and interest on the Bonds in accordance with the provisions of the Resolution. Construction Fund The Issuer covenants and agrees to establish a separate fund to be known as the "City of Ocoee Water and Sewer System Refunding and Improvement Revenue Bonds Construc- tion Fund," which shall be used only for payment of the Cost of the Project. Within such Construction Fund there shall be established separate accounts for each Series of Bonds. • Moneys in the Construction Fund, until applied in payment of any item of the Cost of a Project, in the manner provided in the Resolution, shall be held in trust and shall be subject to a lien and charge in favor of the Holders of the Bonds and for the further security of such Holders. Funds and Accounts The Issuer covenants and agrees to establish with a bank or trust company in the State of Florida, which is eligible under the laws of such State to receive funds of the Issuer, separate funds to be known as the "City of Ocoee Water and Sewer System Refunding and Improvement Revenue Bonds Revenue Fund," the "City of Ocoee Water and Sewer System Refunding and Improvement Revenue Bonds Debt Service Fund," the "City of Ocoee Sewer System Development Charges Fund," the "City of Ocoee Water System Development Charges Fund," and the "City of Ocoee, Water and Sewer System Refunding and Improvement Revenue Bonds Reserve Fund." The Issuer shall maintain in the Debt Service Fund three accounts: the Interest Account," the "Principal Account" and the "Redemption Account." Within the Reserve Fund the Issuer shall maintain separate accounts for each Series of Bonds. Moneys in the aforementioned funds and accounts, until applied in accordance with the provisions of the Resolution, shall be held in trust and, except as provided in the Resolution, be subject to a lien and charge in favor of the Holders and for further security of the Holders. Flow of Funds (A) Except as otherwise provided in the Resolution, the Issuer shall deposit the Gross Revenues into the Revenue Fund promptly upon receipt thereof. Moneys in the Revenue Fund shall first be used for payments of Cost of Operation and Maintenance of the System. The moneys remaining in the Revenue Fund shall be deposited or credited on or before the twentieth (20th) day of each month, commencing with the month following D-21 delivery of the Bonds to the purchaser or purchasers thereof, or such later date as provided. in the Resolution, in the following manner and in the following order of priority: (1) Interest Account. To the extent not substituted or supplemented by other Pledged Funds, the Issuer shall deposit into or credit to the Interest Account in the Debt Service.Fund the sum which, together with the balance in said account, shall equal the interest on all Outstanding Bonds accrued and unpaid and to accrue to the end of the then current calendar month. Moneys in the Interest Account shall be used to pay interest on the Bonds as and when the same become due, whether by redemption or.otherwise, .and for no other purpose. The Issuer shall adjust the amount of the deposit into the Interest Account not later than the month immediately preceding any Interest Date so as to provide sufficient moneys in the Interest Account to pay the interest on the Bonds coming due on such Interest Date. (2) Principal Account. Next, to the extent not substituted or supplemented by other Pledged Funds, the Issuer shall deposit into or credit to the Principal Account in the Debt Service Fund, the sum which, together with the balance in said account, shall equal the principal amounts on all Outstanding Bonds due and unpaid and that portion of the principal next due which would have accrued on said Bonds during the then current calendar month if such principal amounts were deemed to accrue monthly (assuming that a year consists of twelve (12) equivalent calendar months of thirty (30) days each) in equal amounts from the next preceding principal payment due date, or, if there is no such preceding principal payment due date, from a date one year preceding the due date of such principal amount. Moneys in the Principal Account shall be-used to pay the principal of the Bonds as and when the same shall mature, and for no other purpose. The Issuer shall adjust the amount of deposit to the Principal Account not later than the month immediately preceding any principal payment date sous to provide sufficient moneys in the Principal Account to pay the principal on Bonds becoming due on such principal payment date. (3) Redemption Account. Commencing in the month which is one year prior to any Amortization Installment due date, the Issuer shall, to the extent not substituted or supplemented by other Pledged Funds, deposit into or credit to the Redemption Account in the Debt Service Fund, the sum which, together with the balance in said account, shall equal.the Amortization Installments .on all Bonds Outstanding due and unpaid and that portion of the Amortization Installments of all Bonds Outstanding next due which would have accrued on such Bonds during the then current calendar month if such Amortization Installments were deemed to accrue monthly (assuming that a year consists of twelve (12) equivalent calendar months having thirty.(30) days each) in equal amounts from the next preceding Amortization Installment due date, or, if there is no such preceding Amortization Installment due date, from a date one year preceding the due date of such Amortization Installment. Moneys in the Bond Amortization Account shall be used to purchase or redeem Term Bonds in the manner provided in the Resolution, and D-22 for no other purpose. The Issuer shall adjust the amount of the deposit into the Bond Amortization Account not later than the month immediately preceding any date for payment of an Amortization Installment so as to provide sufficient moneys in the Bond Amortization Account to pay the Amortization Installments on the Bonds coming due on such date. Payments to the Bond Amortization Account shall be on a parity with payments to the Principal Account. Amounts accumulated in the Bond Amortization Account with respect to any Amortization Installment (together with amounts accumulated in the Interest Account with respect to interest, if any, on the Term Bonds for which such Amortization Installment was established) may be applied by the Issuer, on or prior to the sixtieth (60th) day preceding the due date of such Amortization Installment (a) to the purchase of Term Bonds of the Series and maturity for which such Amortization Installment was established, at a price not greater than the Redemption Price at which such Term Bonds may be redeemed on the first date thereafter on which such Term Bonds shall be subject to redemption, or (b) to the redemption at the applicable. Redemption Price of such Term Bonds, if then redeemable by their terms. The applicable Redemption Price (or principal amount of maturing Term Bonds) of any Term Bonds so purchased or redeemed shall be deemed to constitute a part of the Bond Amortization Account until such Amortization Installment date, for the purposes of calculating the amount of such Account. As soon as practicable after the sixtieth (60th) day preceding the due date of any such Amortization Installment, the Issuer shall proceed to call for redemption on such due date, by causing notice to be given as provided in the Resolution, Term Bonds of the Series and maturity for which such Amortization Installment was established (except in the case of Term Bonds maturing on an Amortization Installment date) in such amount as shall be necessary to complete the retirement of the unsatisfied balance of such Amortization Installment. The Issuer shall pay out of the Bond Amortization Account and the Interest Account to the appropriate Paying Agents, on or before the day preceding such redemption date (or maturity date), the amount required for the redemption (or for the payment of such Term Bonds then maturing), and such amount shall be applied by such Paying Agents to such redemption (or payment). All expenses in connection with the purchase or redemption of Term Bonds shall be paid by the Issuer from the Revenue Fund. (4) Reserve Fund. The Issuer shall next deposit from moneys remaining in the Revenue Fund an amount required by each Series Resolution into each account within.the Reserve Fund. Any withdrawals froth any account in the Reserve Fund shall be subsequently restored from the first moneys available in the Revenue Fund, on a pro rata basis as to all accounts in the Reserve Fund, after all required current payments for Cost of Operation and Maintenance and all current applications and allocations to the Debt Service Fund, including all deficiencies for prior payments have been made in full. Notwithstanding the foregoing, in no event shall the Issuer be required to deposit into any account in the Reserve Fund an amount greater than D-23 that amount necessary to ensure that the difference: between the Reserve Requirement for the Series of Bonds for which such account was established and the amounts on deposit in such account on the date of calculation shall be restored not later than sixty (60) months after the date of such deficiency (assuming equal monthly payments into such account for such sixty (60) month period. To the extent the Issuer determines pursuant to a Supplemental Resolution to fund an account within the Reserve Fund for a respective Series of Bonds,the Issuer may provide that the difference between the amounts on deposit in such account and the Reserve Requirement for such Series of Bonds shall be an amount covered by obtaining bond insurance or a surety bond issued by a reputable and recognized municipal bond insurer, by a letter of credit rated in one of the two highest categories by one of two nationally recognized rating agencies, or any combination thereof. Notwithstanding the foregoing, the Issuer may not deposit bond insurance, a surety bond or a letter of credit in the account in the Reserve Fund established for the benefit of the Series 1993 Bonds without the consent of MBIA. Moneys in the Reserve Fund shall be used only for the purpose of the payment of Amortization Installments, principal of, or interest on the Outstanding Bonds when the other moneys allocated to the Debt Service Fund are insufficient therefor,and for no other purpose. Moneys in each account in the Reserve Fund shall be valued as determined by a resolution of the Issuer adopted at or prior to the issuance. Notwithstanding any provision of the Resolution to the contrary, moneys on deposit in each respective account in the Reserve Fund shall only be applied for payment of Amortization Installments, principal of or interest on the Outstanding Series of Bonds for which such account was established and for no other Series of Bonds and for no other purpose. In the event of the refunding of any Series of Bonds, the Issuer may withdraw from the account within the Reserve Fund for such Series of Bonds, all or any portion of the amounts accumulated therein with respect to the Bonds being"refunded and deposit such amounts as required by the resolution authorizing the refunding of such Series of Bonds; provided that such withdrawal shall not be made unless (a) immediately thereafter the Bonds being refunded shall be deemed to have been paid pursuant to the provisions of the Resolution and (b) the amount remaining in such account after giving effect to the issuance of such refunding obligations and the disposition of the proceeds thereof shall not be less than the Reserve Requirement for any Bonds of such Series then Outstanding. The balance of any moneys after the deposits required by the Resolution may be transferred, at the -discretion of the Issuer, to any other fund or account of the Issuer, including funds and accounts not established pursuant to the Resolution, and be used for any lawful purpose. (B) The Issuer, in its discretion, may use moneys in the Principal Account and the Interest Account to purchase or redeem Bonds coming due on the next principal payment date, provided such purchase or redemption does not adversely affect the Issuer's ability to D-24 pay the principal or interest coming due on such principal payment date on the Bonds not so purchased or redeemed. (C) At least one (1) business day prior to the date established for payment of any principal of or Redemption Price, if applicable, or interest on the Bonds, the Issuer shall withdraw sufficient moneys from the Debt . Service Fund to pay such principal or Redemption Price, if applicable, or interest and deposit such moneys with the Paying Agent for the Bonds to be paid. Sewer System Development Charges Fund All Sewer System Development Charges shall, upon receipt thereof, be deposited in the Sewer System Development Charges Fund. All moneys remaining on deposit in said fund shall be utilized on or before the 21st day of each month, as follows: (1) Such moneys shall, in the case of a deficiency in the Debt Service Fund, first be applied and allocated to the Debt Service Fund to supplement Revenues to be deposited therein or may be applied and allocated to the Debt Service Fund in substitution of Revenues to be deposited therein. (2) Thereafter, all moneys in the Sewer System Development Charges Fund may be applied by the Issuer for any use allowed by law. Notwithstanding the foregoing, the aggregate amount of Sewer System Development Charges applied and allocated in a Fiscal Year to the Bond Service Requirement for any Series of Bonds shall never exceed said Sewer System Development Charges Bond Service Component for such Series of Bonds in such Fiscal Year. Water System Development Charges Fund All Water System Development Charges shall, upon receipt thereof, be deposited in the Water System Development Charges -Fund. All moneys remaining on deposit in said fund shall be utilized on or before the 21st day of,each month, as follows: (1) Such moneys shall, in the case of a deficiency in the Debt Service Fund, first be applied and allocated to the Debt Service Fund to supplement Revenues to be deposited therein or may be applied.and allocated to the Debt Service Fund in substitution of Revenues to be deposited therein. (2) Thereafter, all moneys in the Water System Development Charges Fund may be applied by the. Issuer for any use allowed by law. Notwithstanding the foregoing, the aggregate amount of Water System Development Charges applied and allocated in a Fiscal Year to the Bond Service Requirement for any D-25 Series of Bonds shall never exceed said Water System Development Charges Bond Service Component for such Series of Bonds in such Fiscal Year. Investments The Construction Fund, the Revenue Fund, the Debt Service Fund, the Reserve Fund and all- accounts and subaccounts in such funds shall be continuously secured in the manner by which the deposit of public funds are authorized to be secured by the laws of the State of Florida. Moneys on deposit in the Construction Fund, the Debt Service Fund, the Reserve Fund, the Revenue Fund, the Sewer System Development Charges Fund, the Water System Development Charges Fund and all accounts and subaccounts in such funds may be invested and reinvested by the Issuer and as directed by the Issuer in Permitted Investments maturing no later than the date on which the moneys therein will be needed. Any and all income received by the Issuer from the investment of-moneys in each fund or account created pursuant to the Resolution, except the Construction Fund, shall be retained in such respective fund or account until the amount required to be on deposit therein shall be on deposit in such fund or account, and thereafter shall be transferred to the Revenue Fund. Any and all income received from the investment of moneys in the Construction Fund shall remain on deposit in such fund until the amounts required to complete the Project are on deposit therein, and thereafter shall be transferred to the Revenue Fund. Nothing contained in the Resolution shall prevent any Permitted Investments acquired as investments of or security for funds held under the Resolution from being issued . or held in book-entry form on the books of the Department of the Treasury of the United States. Separate Accounts The moneys required to be accounted for in each of the foregoing funds, accounts and subaccounts established in the Resolution may be deposited in a single bank account, and funds allocated to the various funds, accounts and subaccounts established therein may be invested in a common investment pool, provided-that adequate accounting records are maintained to reflect and control the restricted allocation of the moneys on deposit therein and such investments for the various purposes of such funds, accounts and subaccounts as provided in the Resolution. The designation and establishment of the various funds, accounts, and subaccounts in and by the Resolution shall not be construed to require the establishment of any completely independent, self-balancing funds as such term is commonly defined and used in governmental accounting, but rather is intended solely to constitute an earmarking of certain revenues for certain purposes and to establish certain priorities for application of such revenues as provided in the Resolution. D-26 Subordinated Indebtedness Except under the conditions and in the manner provided in the Resolution, the Issuer will not issue any other obligations (i) payable from the Pledged Funds or (ii) voluntarily create or cause to be created any debt, lien, pledge, assignment, encumbrance or other charge having priority to or being on a parity with the lien thereon and pledge thereof in favor of the Bonds and the interest thereon. The Issuer may at any time or from time to time issue evidences of indebtedness payable in whole or in part out of the Pledged Funds and which may be secured by a pledge of the Pledged Funds; provided, however, that such pledge shall be, and shall be expressed to be, subordinated in all respects to the pledge of the Pledged Funds created by the Resolution. The Issuer shall have the right to covenant with the holders from time to time of any Subordinated Indebtedness to add to the conditions, limitations and restrictions under which any Additional Bonds may be issued pursuant to the Resolution. The Issuer agrees to pay promptly any Subordinated Indebtedness as the same shall become due. Issuance of Additional Bonds No Additional Bonds, payable on a parity with the Bonds then Outstanding pursuant to the Resolution, shall be issued except upon the conditions and in the manner provided in the Resolution. The Issuer may issue one or more Series of Additional' Bonds for any one or more of the following purposes: financing the Cost of an Additional Project, or the completion thereof or of the Initial Project, or refunding any or 'all Outstanding Bonds or of any Subordinated Indebtedness of the Issuer. No such Additional Bonds shall be issued unless the following conditions are complied with: (A) Except as otherwise provided in the Resolution, there shall have been obtained and filed with the Issuer a statement of-an independent certified public accountant of reasonable experience and responsibility: (1) stating that the books and records of the Issuer relating to the Pledged Funds have been examined by him or her; (2) setting forth the amount of the Pledged Funds which have been received by the Issuer during any twelve (12) consecutive months designated by the Issuer within the twenty-four (24)'months immediately preceding the date of delivery of such Additional Bonds with respect to which such statement is made; (3) stating that the amount of the Net Revenues received during the aforementioned 12 month period equals at least one hundred percentum(100%) of the Maximum Annual Debt Service of all Bonds then Outstanding and such Additional Bonds with respect to which such statement is made; and (4) stating that the amount of the Net Revenues together with the Sewer System Development Charges in an amount not greater than the 'Sewer System Development Charges Bond Service Component and the Water System Development Charges in an amount not greater than' the Water System Development Charges Bond Service Component received during the aforementioned twelve- month period equals at least one hundred ten percentum (110%) of the Maximum Annual D-27 Debt Service of all Bonds then Outstanding and such Additional Bonds with respect to which such statement is made; (5) stating that the Net Revenues projected for the twelve- month period following the issuance of such Additional Bonds is projected by the Consulting Engineer to equal not less than one hundred percentum (100%) of the Maximum Annual Debt Service on the Bonds and any proposed Additional Bonds; and (6) stating that the Net Revenues together with the Sewer System Development Charges in an amount not greater than the Sewer System Development Charges Bond Service Component and the Water System Development Charges in an amount not greater than the Water System Development Charges Bond Service Component projected for the twelve-month period following the issuance of such Additional Bonds is projected by the Consulting Engineer to equal not less than one hundred ten percentum (110%) of the Maximum Annual Debt Service on the Bonds and any proposed Additional Bonds. (B) Upon recommendation of the Consulting Engineers, the Pledged Funds certified in (A) above may be adjusted by including (i) 100% of the additional Net Revenues which in the opinion of the Consulting Engineer would have been derived from rate increases adopted before the Additional Bonds are issued, if such rate increases had been implemented before the commencement of the period for which such Pledged Funds are being certified, and (ii) 100% of the additional Net Revenues estimated by the Consulting Engineer to be derived during the first full twelve month period after the date of placing in service the Additional Project financed with the proceeds of the Additional Bonds. (C) Additional Bonds shall be deemed to have been issued pursuant to the Resolution the same as the Outstanding Bonds, and, except as provided in the Resolution, all of the other covenants and other provisions of the Resolution (except as to details of such Additional Bonds inconsistent therewith) shall be for the equal benefit, protection and security of the Holders of all Bonds issued pursuant to the Resolution. Except as provided in the Resolution, all Bonds, regardless of the time or times of their issuance, shall rank equally with respect to their lien on the Pledged Funds and their sources and security for payment therefrom without preference of any Bond over any other. (D) In the event any Additional Bonds are issued for the purpose of refunding any Bonds.then Outstanding, the conditions of the Resolution shall not apply, provided that the issuance of such Additional Bonds shall not result in an increase in the aggregate amount of principal of and interest on the Outstanding Bonds becoming due in the current Fiscal Year and all subsequent Fiscal Years. The conditions of the Resolution shall apply to Additional Bonds issued to refund Subordinated Indebtedness and to Additional Bonds issued for refunding purposes which cannot meet the conditions of this paragraph. (E) For purposes of determining the Maximum Annual Debt Service with respect to Variable-Rate Bonds, if any, the interest rate on such Variable. Rate Bonds shall be assumed to be the highest variable rate borne over the preceding 12 months by Variable Rate Bonds issued under the Resolution and containing the same interest rate index as the Variable Rate Bonds proposed to be issued or, if no such Variable Rate Bonds are at the D-28 time Outstanding under the Resolution, by variable rate debt for which the interest rate is computed by reference to an index comparable to that to be utilized in determining the interest rate for the debt then proposed to be issued. Bond Anticipation Notes The Issuer may issue notes in anticipation of the issuance of Bonds which shall have such terms and details and be secured in such manner, not inconsistent with the Resolution, as shall be provided by Resolution of the Issuer. Books and Records • The Issuer will keep books and records of the receipt of the Pledged Funds in accordance with generally accepted accounting principles, and any Holder or Holders of Bonds shall have the right at all reasonable times to inspect the records, accounts and data of the Issuer relating.thereto. Annual Audit The Issuer shall after the close of each Fiscal Year, cause the financial statements of the Issuer to be properly audited by a recognized independent certified public accountant or recognized independent firm of certified public accountants, and shall require such accountants to complete their report on the annual financial statements in accordance with applicable law. Such annual financial statements shall contain, but not be limited to, a balance sheet, a statement of revenues, expenditures and changes in fund balance, and any other statements as required by law or accounting convention, and a report by such accountants disclosing any material default on the part'of the Issuer of any covenant or agreement in the Resolution which is disclosed by the audit of the financial statements. The annual financial statements shall be prepared in conformity with generally accepted accounting principles. A copy of the audited financial statements for each Fiscal Year shall be furnished to any Holder of a Bond who shall have furnished such Holder's address to the Clerk and requested in writing that the same be furnished to such Holder. The Issuer shall be permitted to make a reasonable charge for furnishing such audited financial statements. No Impairment While any of the Bonds are Outstanding, the pledging of the Pledged Funds in the manner provided in the Resolution shall not be subject to repeal, modification or impairment by any subsequent ordinance, resolution or other proceedings of the City Commission. D-29 Rate Covenant Beginning with a Fiscal Year in which the Bonds are issued, the Issuer will fix, establish, revise from time to time whenever necessary, maintain and collect always such fees, rates, rentals and other charges for the use of the products, services and facilities of the System which will always provide Revenues in each year sufficient to pay (a) the aggregate of the amount needed to pay all Cost of Operation and Maintenance as the same shall.become due in .such year, one hundred percentum (100%) of the Bond Service Requirement becoming due in such year on the Outstanding Bonds, and one hundred (100%) of all other deposits to be made pursuant to the Resolution and (b) together with the Sewer System Development charges in an amount not greater than the Sewer System Development Charges Bond Service Component and the Water System Development Charges in an amount not greater than the Water System Development Charges Bond Service Component, the aggregate:of the amount needed to pay the Cost of Operation and Maintenance as the same shall. become due in such year, one hundred ten percentum (110%) of the Bond Service Requirement coming due in such year on the Outstanding Bonds, and one hundred percentum (100%) of all other deposits to be made pursuant to the Resolution. Such rates, fees, rentals or other charges shall not be reduced so as to render them insufficient to provide revenues for such purposes. For purposes:of the Resolution, the interest rate on Variable Rate Bonds shall be assumed to be the average variable rate borne over the preceding twelve months (or such shorter period of time as such Variable Bonds shall be Outstanding) by Variable Rate Bonds issued under the Resolution. Disposition of System The Issuer shall not sell, lease, encumber or in any manner dispose of the System as a whole until all of the Bonds shall have been paid in full as to both principal and interest. The City may sell or dispose of, for fair market value, any properties or parts of the System which the Consulting Engineer shall certify in writing are not necessary for the continuing operation of the System, and that the sale or disposal of which will not adversely affect the Revenues to such an extent that the Issuer might fail to comply with the covenants of the Resolution. To the extent the amount to be received therefor is not in excess of one- half (l ) of one per centum (1.0%) of the value of the gross plant investment in the System, the finding set forth above and required to be made by the Consulting Engineer may be made by an authorized representative of the Issuer. The proceeds derived from any sale or disposal of any properties or parts of the System as provided for in the above paragraph, shall be used exclusively for the purpose of paying the cost of extensions, enlargements or additions to, or the replacement of capital assets of the System and for any unusual or extraordinary repairs, or for the construction or acquisition of additions, extensions and improvements to the System. However, if the D-30 Consulting Engineer certifies that it is neither necessary nor desirable to use all or any portion of the proceeds for such purposes, the Issuer may use such certified portion of the proceeds for the purchase or redemption of the Bonds. Insurance The Issuer shall provide protection for the System in accordance with Prudent Utility Practice. Said protection may consist of insurance, self insurance and indemnities. The Issuer will keep, or cause to be kept, the works, plants and facilities comprising the properties of the System insured, and will carry such other insurance against fire and other risks, accidents or casualties at least to the extent and of the kinds that insurance is usually carried by utilities operating like properties. Any insurance shall be in the form of policies or contracts for insurance with insurers of good standing, shall be payable to the Issuer and may provide for such deductibles, exclusions, limitations, restrictions, and restrictive endorsements customary in policies for similar coverage issued to entities operating properties similar to the properties of the System. Any self insurance shall be in the amounts, manner and of the type provided by entities operating properties similar to the properties of the System. In the event of any loss or damage to the System covered by insurance, the Issuer will, with respect to each such loss, promptly repair, reconstruct or replace the parts of the System affected by such loss or damage to the extent necessary to the proper conduct of the operation of the business of the System in accordance with Prudent Utility Practices, shall cause the proceeds of such insurance to be applied for that purpose to the 'extent required therefor, and pending such application shall hold the proceeds of any insurance policy covering such damage or loss in trust to be applied for that purpose to the extent required therefor. Any excess insurance proceeds received by the Issuer shall be used to purchase or redeem Bonds. No Free Services So long as any Bonds are outstanding, the Issuer shall not furnish or supply the facilities, services and commodities of the System either free of charge or for a nominal charge to any person, firm or corporation, public or private. The Issuer shall promptly enforce the payment of any and all accounts owing to the Issuer and delinquent, by discontinuing service or by filing suits, actions or proceedings, or by both discontinuance of service and filing suit. Notwithstanding the foregoing, nothing in the Resolution shall prohibit the Issuer from paying (on behalf of the Issuer or on behalf of any person, firm or corporation) for such facilities, services and commodities with legally available funds of the Issuer, other than Pledged Funds. Failure to Pay Upon failure of any user to pay for services rendered by the System within forty-five (45) days, the Issuer shall, to the full extent permitted by law, shut off the connection of such user and shall not furnish him or permit him to receive from the System further service D-31 until all obligations owed by,him to the Issuer on account of services shall have been paid in full. This covenant shall not, however, prevent the, Issuer:from:causing the System connection to be shut off sooner, to:the extent permitted by law. Enforcement of Collections In accordance with the provisions of the Resolution, the Issuer will diligently enforce and collect the rates, fees and other_charges for the services and facilities:of the System and will take all steps, actions and proceedings for the enforcement. and collection of such rates, charges.and fees as shall become delinquent to the full extent permitted or authorized by law and required by the Resolution; and will maintain accurate records with respect thereof. All such fees, rates, charges and revenues shall, as collected, be held:in trust to be applied as provided in the Resolution. Operating Budget The Issuer shall annually,prior to commencement of each of its Fiscal Years,prepare and adopt a; detailed budget ,Of the estimated expenditures for the operation and - maintenance-of the System during such next succeeding Fiscal Year., The Issuer shall mail copies of such annual budgets (including any amendments thereto) to any Holder or Holders of.Bonds who shall file,his address.with the Issuer and request in writing that copies of all such budgets be furnished him and shall make available such budgets of the System at all reasonable times to,any-Holder or Holders of Bonds or to anyone acting for and on behalf of such Holder or Holders. Bondholders shall pay-reasonable actual cost of printing and mailing of such copies„ Supervisory Personnel The Issuer iri operating the System will employ or designate as manager one or more of its qualified employees who have demonstrated ability and experience in operating similar facilities, and will require all employees who may have possession of money derived from the operation of the System to be covered by a fidelity bond; written by a responsible indemnity company in.amounts fully adequate to protect the Issuer from loss. Payment of Taxes,.Assessments and other Claims The Issuer shall from time to time duly pay:and,discharge-, or:cause to be paid and discharged, all taxes, assessments and other governmental: charges, ,or payments in lieu - • thereof, lawfully imposed upon the properties constituting the System or the Pledged Funds when the same shall become due, as well as all lawful claims for labor and materials and supplies which, if not paid, might become a lien or charge upon such properties or any part thereof, or upon the Pledged Funds or which might in any way impair the security of the Bonds, except taxes, assessments, :,charges or claims which the Issuer shall in good faith contest by proper legal proceedings, D-32. No.,Competing System To the full:extent permitted by law; the Issuer will not grant, or cause, consent to, or allow the granting of any franchise or allow any-person, firm, corporation or body, or agency or instrumentality whatsoever, to furnish water or sewer services in the territorial area served by the Issuer'as of the date of issuance of the Series 1993 Bonds which the Issuer determines will materially adversely affect Revenues. Federal Income Tax Covenants; Taxable Bonds - (A)The Issuer covenants with the Holders of the Bonds (other than Taxable Bonds), that it shall not use 'the proceeds ,of:such Bonds in any manner which would cause the interest" on such Bonds to, be or become includable in the gross income.of:the Holder thereof for federal income tax purposes. (B) The Issuer covenants'with the Holders of the Bonds (other than Taxable Bonds) that neither the Issuer nor any Person under its control or direction will make any use of the proceeds of the Bonds (or amounts deemed to be proceeds under the Code) in any manner which would cause the Bonds to be "arbitrage bonds"within the meaning'of Section 148 of the Code and neither the Issuer nor any other Person shall do any act fail to do any act which would" cause the interest on the Bonds to become includable in the gross income of the Holder thereof for federal income tax purposes. (C) The Issuer covenants with the Holders of the Bonds (other than Taxable Bonds)that it will comply with all provisions of.the Code necessary to maintain the exclusion of interest on the Bonds from the gross income of,the Holder thereof'for federal income tax purposes, including,_in,particular, the payment`of any amount required to be rebated to the U.S. Treasury'pursuant to'the Code: (D) The Issuer may, if it so elects,issue one or more Series of Taxable Bonds the interest on which is (or"may be) includable in the gross income of the Holder thereof for ' federal income tax purposes, so long as each Bond of such Series states in the body thereof that interest payable thereon is_(or may be) subject to federal income taxation and provided that the issuance thereof will not cause the:interest on any other Bonds theretofore issued Under the Resolution'to be or become includable in the gross income of the Holder thereof for federal income tax purposes. The covenants set forth in paragraphs (A), (B) and (C) above shall not apply to any Taxable Bonds. (E) In order to ensure compliance with the rebate provisions of Section 148(f) of the . Code with respect to any Series of Bonds for which'the Issuer intends on the date of issuance thereof to be excluded from gross'income for purposes of Federal income taxation, the Issuer creates the "City of.Ocoee Water-and.Sewer System Refunding and Improvement Revenue Bonds Rebate Fund" to be held by the Issuer. Within such fund there shall be maintained for each:'Series of Bonds a subaccouiit: °'The Rebate Fund- need not be D-33 maintained so long as the Issuer timely satisfies its obligation to pay any rebatable earnings to the United States Treasury; however, the Issuer may, as an administrative convenience, maintain and deposit funds in the Rebate Fund from time to time. Any moneys held in the Rebate Fund shall not be considered Pledged Funds and shall not be pledged in any manner for the.benefit of the Holders of.the Bonds. Moneys in the.Rebate Fund (including earnings and deposits therein) shall be held for future payment to the United States Government as required by the Code and as set forth in instructions of Bond Counsel delivered to the Issuer upon the issuance of such Bonds. Notwithstanding any provision of the Resolution to the contrary, to the extent the Issuer is required or elects to make deposits to the Rebate Fund, such amounts may be taken from any. fund or account created thereunder. Events of Default The following events shall each constitute an "Event of Default": (A) Default shall be made in the payment of the principal of, Amortization Installment, redemption premium or interest on any Bond when due. (B) There shall occur the dissolution or liquidation of the Issuer, or the filing by the Issuer of a voluntary petition in bankruptcy, or the commission by the Issuer of any act of bankruptcy, or adjudication of the Issuer as a bankrupt, or assignment by the Issuer for the benefit of its creditors, or appointment of a receiver for the.Issuer, or the entry by the Issuer into an agreement of composition with its creditors, or the approval by a court of competent jurisdiction of a petition applicable to the Issuer in any proceeding for its reorganization instituted under the provisions of the Federal Bankruptcy. Act, as amended, or under any similar act in any jurisdiction which may now be in effect or hereafter enacted. (C) The Issuer shall default in the due and punctual performance of any other of the covenants, conditions, agreements and provisions contained in the Bonds or in the Resolution on the part of the Issuer to be performed, and such default shall continue for a period of thirty (30) days after written notice of such default shall have been received from the Holders of not less than twenty-five percent (25%) of the aggregate principal amount of Bonds Outstanding. Notwithstanding the foregoing, the, Issuer shall not be deemed in default under the Resolution if such default can be cured within a reasonable period of time and if the Issuer in good faith institutes curative action and diligently pursues such action until the default has been corrected.. Remedies. Any Holder of Bonds issued under the provisions of the Resolution or any trustee or receiver acting for such Bondholders may either at law or in equity, by suit, action, mandamus or other proceedings in any court of competent jurisdiction, protect and enforce D-34 any and all rights under the laws of the State of Florida, or granted and contained in the Resolution, and may enforce and compel the performance of all duties required by the Resolution or by any applicable statutes to be performed by the Issuer or by any officer thereof. The Holder or Holders of Bonds in an aggregate principal amount of not less than twenty-five percent (25%) of the Bonds then.Outstanding may by a duly executed certificate in writing appoint a trustee for Holders of Bonds issued pursuant to the Resolution with authority to represent such Bondholders in any legal proceedings for the enforcement and protection of the rights of such Bondholders and such certificate shall be executed by such Bondholders or their duly authorized attorneys or representatives, and shall be filed in the office of.the Clerk. Notice of such appointment, together with evidence of the requisite signatures of the Holders of not less than twenty-five percent (25%) in aggregate principal amount of Bonds Outstanding and the trust instrument under which the trustee shall have agreed to serve shall be filed with the Issuer and the trustee and notice of appointment shall be given to all Holders of Bonds in the same manner as notices of redemption are given under the Resolution. After the appointment of the first trustee under the Resolution, no further trustees may be appointed; however, the Holders of a majority in aggregate principal amount of all the Bonds then Outstanding may remove the trustee initially appointed and appoint a successor and subsequent successors at any time. As long as any Bonds are Outstanding, the consent of MBIA must be obtained before the Bondholders, or any trustee appointed to represent the Bondholders, may pursue the remedies set forth in this Section. MBIA shall have the same right to pursue any such remedies as the Bondholders. . Directions to Trustee as to Remedial Proceedings The Holders of a majority in principal amount of the Bonds then Outstanding have the right, by an instrument or concurrent instruments in writing executed and delivered to the trustee, to direct the method and place of conducting all remedial proceedings to be taken by the trustee under the Resolution, provided that such direction shall not be otherwise than in accordance with law or the provisions of the Resolution, and that the trustee shall have the right to decline to follow any such direction which in the opinion of the trustee would be unjustly prejudicial to Holders of Bonds not parties to such direction. Remedies Cumulative No remedy conferred upon or reserved to the.Bondholders in the Resolution is intended to be exclusive of any other remedy or remedies, and each and every such remedy shall be cumulative, and shall be in addition to every other remedy given thereunder or now or hereafter existing at law or inequity or by statute. D-35 Waiver of Default I : No delay.oromission of any Bondholder to exercise any right or power accruing upon: any default shall impair any such right or power Or shall be construed to be a waiver of any such default, or an acquiescence therein; and every power and remedy given by. the Resolution to the Bondholders maybe exercised from time to time; and as often as:may be deemed expedient. Application of Moneys After Default If an Event of Default shall happen and shall not have been remedied, the Issuer. or a trustee or receiver appointed for the purpose shall apply all Pledged Funds as follows and: in the following:order: (A) To the payment of the reasonable and proper charges, expenses and liabilities of the trustee or receiver, Registrar and Paying Agent under. the Resolution; and _ (B) To the payment of the interest and principal or Redemption Price, if applicable, then due on the Bonds; as follows: (1) Unless-the principal of all the Bonds shall have become due and'payable,`. . all such moneys shall be applied: , FIRST: ;to;the payment to the Persons entitled thereto of all installments of interest then due, in the order of the maturity of such installments, and, if the amount available shall not be sufficient to pay in full any particular installment, then • to the payment ratably, according to the.amounts due on such installment;',to the Persons entitled thereto, without any discrimination or preference; SECOND to the payment:,to the Persons entitled:thereto of the:.unpaid principal: of any of the Bonds which shall have-become due at maturity or -upon. :mandatory redemption prior. to:Maturity (other than Bonds called for redemption for the payment of which.moneys are held;pursuant tb the provisions of the Resolution), in the order of their due dates, with interest upon such Bonds froth the respective dates upon which they- became .due, and, if the.amount available shall.not be: sufficient to pay in full.Bonds due on any particular-date, together with such interest, then to the payment first:of such interest; ratably according to-the amount:of such. interest due on such date, and then to the payment of such principal, ratably • according to the amount of such principal due on such date,'to :the Persons entitled:.. thereto without any discrimination or:preference; and THIRD; . to the payment of the Redemption Price of any=Bonds:called for optional redemption pursuant to the provisions of the Resolution. D-36; (2) If the principal of all the Bonds shall have become due and payable, all such moneys shall be applied to the payment of the principal and interest then due and unpaid upon the Bonds, with interest thereon as aforesaid, without preference or priority of principal over interest or of interest over principal, or of any installment of interest over any other installment of interest, or of any Bond over any other Bond, ratably, according to the amounts due respectively for principal and interest, to the Persons entitled thereto without any discrimination or preference. (C) To the payment of Cost of Operation and Maintenance of the System. Supplemental Resolution Without Bondholders' Consent The Issuer, from time to time and at any time, may adopt such Resolution or Supplemental Resolutions, without the consent of the Bondholders (which Resolution or Supplemental Resolution shall thereafter form a part of the Resolution) for any of the following purposes: (A) To cure any ambiguity or formal defect or omission or to correct any inconsistent provisions in the Resolution or to clarify any matters or questions arising thereunder. (B) To grant to or confer upon the Bondholders any additional rights, remedies, powers, authority or security that may lawfully be granted to or conferred upon the Bondholders. (C) To add to the conditions, limitations and restrictions on the issuance of Bonds under the 'provisions of the Resolution other conditions, limitations and restrictions thereafter to be observed. (D) To add to the covenants and agreements of the Issuer in the Resolution other covenants and agreements thereafter to be observed by the Issuer or to surrender any right or power therein reserved to or conferred upon the Issuer. (E) To specify and determine the matters and things referred to in the Resolution, and also any other matters and things relative to such Bonds which are not contrary to or inconsistent with the Resolution as theretofore in effect, or to amend, modify or rescind any such authorization, specification or determination at any time prior to the first delivery of such Bonds. (F) To authorize Additional Projects or to change or modify the description of the Initial Project or any Additional Project. (G) To specify and determine matters necessary or desirable for the issuance of Variable Rate Bonds. D-37 (H) To authorize the issuance of Additional Bonds. For so long as the Bonds shall be Outstanding, notice-of the adoption of any such amendment shall be given to MBIA, and as to the Series 1997 Bonds, notice to AMBAC Indemnity. Supplemental Resolution with Bondholders' Consent Subject to the terms and provisions contained in the Resolution, the Holder or Holders of not less than a majority in aggregate principal amount of the Bonds then Outstanding shall have the right, from time to time, anything contained in the Resolution to the contrary notwithstanding, to consent to and approve the adoption of such Supplemental Resolution or Resolutions as shall be deemed necessary or desirable by the Issuer for the purpose of. supplementing, modifying, altering, amending, adding to or rescinding, in any particular, any of the terms or provisions contained in the Resolution; provided, however, that if such modification or amendment will, by its terms, not take effect so long as any Bonds of any specified Series or maturity remain Outstanding, the consent of the Holders of such Bonds shall not be required and such Bonds shall not be deemed to be Outstanding for the purpose of any calculation of Outstanding Bonds under the Resolution. No Supplemental Resolution may be approved or adopted which shall permit or require (A) an extension of the maturity of the principal of or the payment of the interest on any.Bond issued..under the Resolution, (B) reduction in the principal amount of any Bond or the Redemption Price or the rate of interest thereon, (C) the creation of a lien upon or a pledge of other than the lien and pledge created by the Resolution which adversely affects any Bondholders, (D) a preference or priority of any Bond or Bonds over any other Bond or Bonds, or (E) a reduction in the aggregate principal amount of the Bonds required for consent to such Supplemental Resolution. Nothing therein contained, however, shall be construed as making necessary the approval by Bondholders of the adoption of any Supplemental Resolution as authorized in the Resolution. If at any time the Issuer shall determine that it is necessary or desirable to adopt any Supplemental Resolution pursuant to the Resolution the Clerk shall cause the Registrar to give notice of the proposed action and to cause the form of consent to such adoption to be mailed,.postage prepaid, to all Bondholders at their addresses: as they appear on the registration books and to MBIA and AMBAC Indemnity (for so long as the Bonds or the Series 1997 Bonds, respectively, shall be Outstanding. Such notice shall briefly set forth the nature of the proposed Supplemental Resolution and shall state that copies thereof are on file at the offices of the Clerk and the Registrar for inspection by all Bondholders. The Issuer shall.not, however, be subject to any liability to any Bondholder by reason of its failure to cause the notice required by the Resolution to be mailed and any such failure. shall not affect the validity of such Supplemental Resolution when consented to and approved as provided in the Resolution. . . D-38 Whenever the Issuer shall deliver to the Clerk an instrument or instruments in writing purporting to be executed by the Holders of not less than a majority in aggregate principal amount of the Bonds then Outstanding and by MBIA and AMBAC Indemnity if the Bonds or the Series 1997 Bonds, respectively, shall then be Outstanding, which instrument or instruments shall refer to the proposed Supplemental Resolution described in such notice and shall specifically consent to and approve the adoption thereof in substantially the form of the copy thereof referred to in such notice, thereupon, but not otherwise, the Issuer may adopt such Supplemental Resolution in substantially such form, without liability or responsibility to any Holder of any Bond, whether or not such Holder shall have consented thereto. If the Holders of not less than a majority in aggregate principal amount of the Bonds Outstanding at the time of the adoption of such Supplemental Resolution shall have consented to and approved the adoption thereof as provided in the Resolution, no Holder of any Bond shall have any right to object to the adoption of such Supplemental Resolution, or to object to any of the terms and provisions contained therein or the operation thereof, or in any manner to question the propriety of the adoption thereof, or to enjoin or restrain the Issuer from adopting the same or from taking any action pursuant to the provisions thereof. Upon the adoption of any Supplemental Resolution pursuant to the provisions of the Resolution, the Resolution shall be deemed to be modified and amended in accordance therewith, and the respective rights, duties and obligations under the Resolution of the Issuer and all Holders of Bonds then Outstanding shall thereafter be determined, exercised and enforced in all respects under the e provisions of the Resolution as so modified and amended. A copy of any Supplemental Resolution adopted pursuant to this Section shall be sent to Standard & Poor's Corporation. Defeasance If the Issuer shall pay or cause to be paid or there shall otherwise be paid to the Holders of all Bonds the principal or Redemption Price, if applicable, and interest due or to become due thereon, at the times and in the manner stipulated therein and in the Resolution, then the pledge of the Pledged Funds, and all covenants, agreements and other obligations of the Issuer to the Bondholders, shall thereupon cease, terminate and become void and be discharged and satisfied. In such event, the Paying Agents shall pay over or deliver to the Issuer all money or securities held by them pursuant to the Resolution which are not required for the payment or redemption of Bonds not theretofore surrendered for such payment or redemption. Any Bonds or interest installments appertaining thereto, whether at or prior to the maturity or redemption date of such Bonds, shall be deemed to have been paid within the D-39 meaning of the Resolution, if (A) in case any such Bonds are to be redeemed prior to the maturity thereof, there shall have been taken all action necessary to call such Bonds for redemption and notice of such redemption shall have been duly given or provision shall have been made for the giving of such notice, and (B) there shall have been deposited in irrevocable trust with a banking institution or trust company by or on behalf of the Issuer either moneys in an amount which shall be sufficient, or Federal Securities the principal of and the interest on which when due will provide moneys which, together with the moneys, if any, deposited with such bank or trust company at the same time shall be sufficient, to pay the principal of or Redemption Price, if applicable, and interest due and to become due on said Bonds on and prior to the redemption date or maturity date thereof, as the case may be. Except as hereafter provided, neither the Federal Securities nor any moneys so deposited with such bank or trust company nor any moneys received by such bank or trust company on account of principal of or Redemption Price, if applicable, or interest on said Federal Securities shall be withdrawn or used for any purpose other than, and all such moneys shall be held in trust for and be applied to, the payment, when due, of the principal of or Redemption Price, if applicable, of the Bonds for the payment or redemption of which they were deposited and the interest accruing thereon to the date of maturity or redemption; provided, however, the Issuer may substitute new Refunded Securities and moneys for the deposited Federal Securities and moneys if the new Federal Securities and moneys are sufficient to pay the principal of or Redemption Price, if applicable, and interest on the refunded Bonds. For purposes of determining whether Variable Rate Bonds shall be deemed to have been paid prior to the maturity or redemption date thereof, as the case may be, by the deposit of moneys, or specified Federal Securities and moneys, if any, in accordance with the Resolution, the interest to come due on such Variable Rate Bonds on or prior to the maturity or redemption date thereof, as the case may be, shall be calculated at the Maximum Interest Rate; provided, however, that if on any date, as a result of such Variable Rate Bonds having borne interest at less than the Maximum Interest Rate for any period, the total amount of moneys and specified Federal Securities on deposit for the payment of interest on such Variable Rate Bonds is in excess of the total amount which would have been required to be deposited on such date in respect of such Variable Rate Bonds in order to satisfy the Resolution, such excess shall be paid to the Issuer free and clear of any trust, lien, pledge or assignment securing the Bonds or otherwise existing under the Resolution. In the event the Bonds for which moneys are to be deposited for the payment thereof in accordance with the Resolution are not by their terms subject to redemption within the next succeeding sixty (60) days, the Issuer shall cause the Registrar to mail a notice to the Holders of such Bonds that the deposit required by the Resolution of moneys or Federal Securities has been made and said Bonds are deemed to be paid in accordance with the provisions of the Resolution and stating such maturity or redemption date upon which moneys are to be available for the payment of the principal of or Redemption Price, if applicable, and interest on said Bonds. D-40 Nothing in the Resolution shall be deemed to require the Issuer to call any of the Outstanding Bonds for redemption prior to maturity pursuant to any applicable optional redemption provisions, or to impair the discretion of the Issuer in determining whether to exercise any such option for early redemption. Sale of Bonds The Bonds shall be issued and sold at public or private sale at one time or in installments from time to.time and at such price or prices as shall be consistent with the provisions of the Act, the requirements of the Resolution and other applicable provisions of law and as shall be approved by subsequent resolution of the Issuer. Bond Insurance Matters Regarding Series 1997 Bonds The Issuer is authorized and directed under the Resolution to purchase a surety bond from the Bond Insurer (the "Reserve Fund Policy") relating to the Series 1997 Bonds to be deposited in the Reserve Fund, and payment for such Reserve Fund Policy to the Bond Insurer is hereby authorized from Series 1997 Bond proceeds. The Issuer hereby authorizes the execution of the Reserve Fund Guaranty Agreement with the Bond Insurer (the "Agreement") in the form attached to the Resolution relating to the issuance of the Surety Bond for the Reserve Fund in conjunction with the issuance of the Series 1997 Bonds and to deliver said Agreement to the Bond Insurer, and does hereby direct the execution and delivery of said Agreement. All of the provisions of said Agreement, when executed and delivered by the Issuer as authorized and when duly authorized, executed and delivered by the Bond Insurer, shall be deemed to be a part of the Resolution as fully and to the same extent as if incorporated verbatim in the appropriate sections. The Issuer covenants, represents, and expressly agrees to the following terms and provisions as such are necessary and desirable in order to obtain the Municipal Bond Insurance Policy: A. Consent of the Bond Insurer. Any provision of the Resolution expressly recognizing or granting rights in or to the Bond Insurer may not be amended in any manner which affects the rights of the Bond Insurer hereunder without the prior written consent of the Bond Insurer. B. Consent of the Bond Insurer in Addition to Bondholder Consent. Unless otherwise provided in this Section, the Bond Insurer's consent shall be required in addition to Bondholder consent,when required, for the following purposes: (i) execution and delivery of any supplemental resolution or any amendment, supplement or change to or modification thereto, (ii) removal of the Paying,Agent and selection and appointment of any successor paying agent for the Series 1997 Bonds; and (iii) initiation or approval of any action not described in (i) or (ii) above which requires Bondholder consent. D-41 C.' Consent of the Bond Insurer in the Event of Insolvency. Any reorganization or liquidation plan with respect to the Issuer must be acceptable to the Bond Insurer. In the event of any reorganization or liquidation,'the Bond Insurer shall have the right to vote on behalf of all Series 1997 Bondholders who hold the Series 1997 Bond Insurer-insured Bonds absent a default by the Bond Insurer under the applicable Municipal Bond Insurance Policy insuring such Series 1997 Bonds. D. Consent of the Bond Insurer upon Default. Anything in the Resolution to the contrary notwithstanding, upon the occurrence and continuance of an event of default, the Bond Insurer shall be entitled to control and .direct the enforcement of all'rights and remedies granted to the Series 1997 Bondholders for the benefit of the Series 1997 Bondholders under the Resolution. E. Notification and Documents to be Furnished. While the Municipal Bond Insurance Policy is in effect,the Issuer shall furnish to the Bond Insurer (to the attention of the Surveillance Department,unless otherwise indicated)various,information as specified in the Resolution: D-42 APPENDIX E FORM OF BOND COUNSEL'S LEGAL OPINION [This page intentionally left blank] • APPENDIX E [FORM OF BOND COUNSEL OPINION] January , 1997 City Commission City of.Ocoee Ocoee, Florida CITY OF OCOEE, FLORIDA WATER AND SEWER SYSTEM IMPROVEMENT REVENUE BONDS SERIES 1997 Ladies and Gentlemen: We have acted as bond counsel in connection with the issuance by the City of Ocoee, Florida (the "Issuer"), of its$ Water and Sewer System Improvement Revenue Bonds, Series 1997 (the"Series 1997 Bonds"), pursuant to the Constitution and laws of the State of Florida, Chapter 166, Part II, Florida Statutes, and other applicable provisions of law and Resolution Nos. 93-02 and 96-32, adopted by the City Commission of the Issuer on February 2, 1993 and December 3, 1996, respectively, as amended and supplemented (collectively, the "Resolution"). Any capitalized undefined terms used herein shall have the meaning set forth in the Resolution. As to questions of fact material to our opinion, we have relied upon representations of the Issuer contained in the Resolution and in the certified proceedings and other certifications of public officials furnished to us, without undertaking to verify the same by independent investigation. We have not undertaken an independent audit, examination, investigation or inspection of such matters and have relied solely on the facts, estimates and circumstances described in such proceedings and certifications. We have assumed the genuineness of signatures on all documents and instruments, the authenticity of documents submitted as originals and the conformity to originals of documents submitted as copies. We have not been engaged or undertaken to review (other than as stated in our supplemental opinion of even date to the underwriters) the accuracy, completeness or sufficiency of any offering material relating to the Series 1997 Bonds. This opinion should not be construed as offering material, an offering circular, prospectus or official statement and is not intended in any way to be a disclosure statement used in connection with the sale or delivery of the Series 1997 Bonds. Furthermore, we are not passing on the accuracy or sufficiency of any CUSIP numbers appearing on the Series 1997 Bonds. In addition, we have not been engaged to and, therefore, express no opinion as to compliance by the Issuer or the underwriter with any federal or state statute, regulation or ruling with respect to the sale and distribution of the Series 1997 Bonds. In rendering this opinion, we have examined and relied upon the opinion of even date herewith of Foley & Lardner, Counsel to the Issuer, as to the due creation and valid existence of the Issuer, the due E-1 January 1997 Page 2 adoption of the Resolution, the due authorization, execution and delivery of the Series 1997 Bonds and the compliance by the Issuer with all conditions contained in the City Charter and ordinances of the Issuer precedent to the issuance of the Series 1997 Bonds. Pursuant to the terms, conditions and limitations contained in the Resolution,the Issuer has reserved the right to issue obligations in the future which shall have a lien on the Pledged Funds equal to that of the Series 1997 Bonds. The lien on the Pledged Funds of the Series 1997 Bonds is on parity with the lien of the Issuer's Water and Sewer System Improvement Revenue Bonds, Series 1993. The Series 1997 Bonds do not constitute a general obligation or indebtedness of the Issuer within the meaning of any constitutional, statutory or other'limitation.of indebtedness and the holders thereof shall never have the right to compel the exercise of any ad valorem taxing power of the Issuer or taxation in any form of any real or personal property for the payment of the_principal of or interest on the Series 1997 Bonds. The opinions set forth below are expressly limited to, and we opine only with respect to, the laws of the State of Florida and the federal income tax laws of the United States of America. Based on our examination, we are of the opinion, as of the date of delivery of and payment for the Series 1997 Bonds, as follows: . 1. The Resolution has been duly adopted by the Issuer and constitutes a valid and binding obligation of the Issuer enforceable upon the Issuer in accordance with its terms. 2. The Series 1997 Bonds have been duly authorized, executed and delivered by the Issuer and are valid and binding special obligations of the Issuer issued on parity with the Issuer's Series 1993 Bonds, enforceable in accordance with their terms, payable solely from the sources provided therefor in the Resolution. 3. The Internal Revenue Code of 1986, as amended (the "Code"), establishes certain requirements which must be met subsequent to the issuance and delivery of the Series 1997 Bonds in order that interest on the Series 1997 Bonds be and remain excluded from gross income for purposes of federal income taxation. Non-compliance may cause interest on the Series .1997 Bonds to be included in federal gross income retroactive to the date of issuance of the Series 1997 Bonds, regardless of the date on which such non-compliance occurs or is ascertained. The Issuer has covenanted in the Resolution to comply with such requirements in order to maintain the exclusion from federal gross income of the interest on the Series 1997 Bonds. . Subject to compliance by the Issuer with the aforementioned covenants, (a) interest on the Series 1997 Bonds is excluded from gross income for purposes of federal income taxation, and (b) interest on the Series 1997 Bonds is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; however, with respect to corporations (as defined for federal income tax purposes), such interest is taken into account in determining adjusted current earnings for the purpose of computing the alternative minimum tax imposed on such corporations. We express no opinion regarding other federal tax consequences arising with respect to the Series 1997 Bonds. E-2 January_, 1997 Page 3 4. The Series 1997 Bonds are exempt from intangible taxes imposed pursuant to Chapter 199, Florida Statutes. It is to be understood that the rights of the owners of the Series 1997 Bonds and the enforceability thereof may be subject to the exercise of judicial discretion in accordance with general principles of equity, to the valid exercise of the sovereign police powers of the State of Florida and of the constitutional powers of the United States of America and to bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights heretofore or hereafter enacted. Our opinions expressed herein are predicated upon present law, facts and circumstances, and we assume no affirmative obligation to update the opinions expressed herein if such laws, facts or circumstances change after the date hereof. Very truly yours, BRYANT, MILLER AND OLIVE, P.A. J:\BONDS\4128\BCOPI N2I 12/6/96I GED I R E-3 [This page intentionally left blank] APPENDIX F FORM OF CONTINUING DISCLOSURE CERTIFICATE [This page intentionally left blank] EXHIBIT F CONTINUING DISCLOSURE CERTIFICATE This Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and delivered by the City of Ocoee, Florida (the "Issuer") in connection with the issuance of $ Water and Sewer System Improvement Revenue Bonds, Series 1997 (the "Bonds"). The Bonds are being issued pursuant to Resolution Nos. 93-02 and 96-32, adopted by the governing board of the Issuer on February 2, 1993 and December 3, 1996, respectively, as amended and supplemented (the "Resolution"). The Issuer covenants and agrees as follows: SECTION 1. PURPOSE OF THE DISCLOSURE CERTIFICATE. This Disclosure Certificate is being executed and delivered by theIssuer for the benefit of the Holders and Beneficial Owners of the Bonds and in order to assist the Participating Underwriter in complying .with the continuing disclosure requirements of Securities , and Exchange Commission Rule 15c2-12. SECTION 2. DEFINITIONS. In addition to the definitions set forth in the Resolution which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the following capitalized terms shall have the following meanings: "Annual Report" shall mean any Annual Report provided by the Issuer pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. "Beneficial Owner" shall mean any person which (a) has the power, directly or indirectly, to vote or consent with respect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees, depositories or other intermediaries), or (b) is treated as the owner of any Bonds for federal income tax purposes. "Dissemination Agent" shall mean the Issuer, or any successor Dissemination Agent designated in writing by the Issuer and which has filed with the Issuer a written acceptance of such designation. "Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate. "National Repository" shall mean any Nationally Recognized Municipal Securities Information Repository.for purposes of the Rule. The National Repositories currently approved by the Securities and Exchange Commission are set forth in Exhibit B. "Participating Underwriter"shall mean the original underwriter of the Bonds required to comply with the Rule in connection with offering of the Bonds. F-1 "Repository" shall mean each National Repository and each State Repository. "Rule" shall mean the continuing disclosure requirements of Rule 15c2-12 adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time. "State" shall mean the State of Florida. "State Repository" shall mean any public or private repository or entity designated by the State as a state information depository for the purpose of the Rule and recognized as such by the Securities and Exchange Commission. As of the date of this Certificate, there is no State Repository. SECTION 3. PROVISION OF ANNUAL REPORTS. (a) The Issuer shall, or shall cause the Dissemination Agent to, not later than 180 days after the end of the Issuer's fiscal year (presently ends September 30), commencing with the report for the 1996 Fiscal Year, provide to each Repository an Annual Report which is consistent with the requirements of Section 4 of this Disclosure Certificate. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may cross-reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the Issuer may be submitted separately from the balance of the Annual Report and later than the date required above for the filing of the Annual Report if they are not available by that date. If the Issuer's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(c). (b) Not later than fifteen (15) Business Days prior to said date, the Issuer shall provide the Annual Report to the Dissemination Agent (if other than the Issuer). If the Issuer is unable to provide to the Repositories an Annual Report by the date required in subsection (a), the Issuer shall send a notice to (i) each National Repository or the Municipal Securities Rulemaking Board, and (ii) the State Repository in substantially the form attached as Exhibit A. (c) The Dissemination Agent shall: (i) determine each year prior to the date for providing the Annual Report the name and address of each National Repository and the State Repository, if any; and (ii) if the Dissemination Agent is other than the Issuer, file a report with the Issuer certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, stating the date it was provided and listing all the Repositories to which it was provided. F-2 SECTION 4. CONTENT OF ANNUAL REPORTS. The Issuer's Annual Report shall contain or include by reference the following: (a) the audited financial statements of the Issuer for the prior Fiscal Year, prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board. If the Issuer's audited financial statements are not available by the time the Annual Report is required to be filed pursuant to Section 3(a), the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. (b) an update of the following financial information and operating data from the Official Statement which are in tabular form: (i) Historic Number of Water System ERUs; (ii) Historic Number of Sewer System ERUs; (iii) Existing Water and Wastewater Rates; and (iv) . Accounts Receivable Information. The information provided under Section 4(b) may be included by specific reference to other documents, including official statements of debt issues of the Issuer or related public entities, which have been submitted to each of the Repositories or the Securities and. Exchange Commission. If the document included by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The Issuer shall clearly identify each such other document so included by reference. (c) a description of any material litigation which would have been disclosed in the Official Statement if such litigation had occurred and been ongoing at the time that the Official Statement is dated. . SECTION 5. REPORTING OF SIGNIFICANT EVENTS. (a) Pursuant to the provisions of this Section 5, the Issuer shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds, if material: 1. delinquencies in the payment of principal and interest on the Bonds; 2. non-payment related defaults; F-3 3. unscheduled draws on the debt service reserves reflecting financial difficulties; 4. .unscheduled draws .-on credit enhancements reflecting financial difficulties; ... 5. substitution of credit or liquidity providers, or their failure to perform; 6. adverse tax opinions to or events affecting the tax-exempt status of the Bonds; 7. modifications to rights of the Holders of the Bonds; 8. any call of the Bonds (other than scheduled mandatory redemption) or any acceleration of the maturity thereof; 9. defeasance in whole or in part of the Bonds; 10. release, substitution, or sale of property securing repayment of the Bonds; and 11. any change in the rating assigned to the Bonds or other obligations of the Issuer. (b) Whenever.the Issuer obtains knowledge of the occurrence of a Listed Event, the Issuer shall as soon as possible, determine if such event would be material under applicable federal securities laws. (c) If the Issuer determines that knowledge of the occurrence of a Listed Event would be material under applicable federal securities laws, the Issuer shall promptly file a notice of such occurrence with (i) each National Repository or the Municipal Securities Rulemaking Board, and (ii) the State Repository. Notwithstanding the foregoing, notice of Listed Events described in Sections 5(a)(8) and (9) need not be given under this Section 5 any earlier than the notice (if any) of the underlying event is given to Holders of affected Bonds pursuant to the Resolution. SECTION 6. TERMINATION OF REPORTING OBLIGATION. The Issuer's obligations under,this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the Bonds. If such termination occurs prior to the final maturity of the Bonds, the Issuer shall give notice of such termination in the same manner as for a Listed Event under Section 5(c). SECTION 7. DISSEMINATION AGENT. The Issuer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this F-4 Disclosure Certificate, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by the Issuer pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be the Issuer. SECTION 8. AMENDMENT; WAIVER. Notwithstanding any other provision of this Disclosure Certificate, the Issuer may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied: (a) If the amendment or waiver relates to the provisions of Sections 3(a), 4, or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature or status of the Issuer, or the type of business conducted; (b) The undertaking, as amended or taking into account such waiver, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the original issuance of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) The amendment or waiver either (i) is approved by the Holders of the Bonds in the same manner as provided in the Resolution for amendments to the Resolution with the consent of Holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the Holders or Beneficial Owners of the Bonds. In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Issuer shall describe such amendment in the next Annual Report, and shall include, as applicable, a narrative explanation of the reason for the amendment or waiver and its impact on the type (or in the case of a change of accounting principles, on the presentation) of financial information or operating data being presented by the Issuer. In addition, if the amendment relates to the accounting principles to be followed in preparing financial statements, (i) notice of such change shall be given in the same manner as for a Listed Event under Section 5(c), and (ii) the Annual Report for the year in which the change is made should present a comparison (in narrative form and also, if feasible, in quantitative form) between the financial statements as prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. SECTION 9. ADDITIONAL INFORMATION. Nothing in this Disclosure Certificate shall be deemed to prevent the Issuer from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure F-5 Certificate. If:the Issuer chooses to include any information in any Annual Report or notice of occurrence of a Listed Event,in addition to that which is specifically required by this Disclosure Certificate, the Issuer shall have no obligation under this Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event. SECTION 10. DEFAULT. In the event of a failure of the Issuer to comply with any provision of this Disclosure Certificate, any Holder or Beneficial Owner of the Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Issuer to comply with its obligations under this Disclosure Certificate; provided, however, the sole remedy under this Disclosure Certificate in the event of any failure of the Issuer to comply with the provisions of this Disclosure Certificate shall be an action to compel performance. A default underthis Disclosure Certificate shall not be deemed an Event of Default under the Resolution. SECTION 11. DUTIES,IMMUNITIES AND LIABILITIES OF DISSEMINATION AGENT. The Disseminations Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the Issuer agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against loss, expense and liabilities which it may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding.liabilities due to the Dissemination Agent's negligence or wilful misconduct. The obligations of.the Issuer under this Section shall survive resignation or removal of the Dissemination Agent and payment of the Bonds. SECTION 12. BENEFICIARIES. This Disclosure Certificate shall inure solely to the benefit of the Issuer, the Dissemination Agent, the Participating Underwriter and Holders and Beneficial Owners from time to time of the Bonds, and shall create no rights in any other person or entity. . Date: January. ; 1997 CITY OF OCOEE, FLORIDA , (SEAL) Mayor . ATTEST: City.Clerk F-6 EXHIBIT A NOTICE OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: City of Ocoee, Florida Name of Bond Issue: Water and Sewer System Improvement Revenue Bonds, Series 1997 (the "Bonds") Date of Issuance: , 199_ NOTICE IS HEREBY GIVEN that the.Issuer has not provided an Annual Report with respect to the above-named Bonds-as required by Section of Resolution No. 96-32 duly adopted by the Issuer on December 3, 1996, as s amended and supplemented, authorizing the issuance of the Bonds, and Sections 3 and 4(b) of the Continuing Disclosure Statement dated 199 The Issuer anticipates that the Annual Report will be filed by Dated: CITY OF OCOEE, FLORIDA . By . Name: Title: A-1 - . EXHIBIT B Nationally Recognized Municipal Securities Information Repositories approved by the Securities and Exchange Commission: Bloomberg Municipal Repositories Kenny Information Services, Inc. P.O. Box 840 Attn: Kenny Repository Service Princeton, NJ 08542-0840 65 Broadway, 16th Floor (609) 279-3200 New York, NY 10006 FAX (609) 279-5962 (212) 770-4595 FAX (212) 797-7994 Thomson.NRMSIR Attn: Municipal Disclosure Moody's NRMSIR 395 Hudson Street, 3rd Floor Public Finance Information Center New York, NY 10014 99 Church Street (212) 807-5001 New York, NY 10007 FAX (212) 989-2078 (800) 339-6306 FAX (212) 553-1460 Disclosure, Inc. Attn: Document Acquisitions/ Donnelly Financial Municipal.Securities Municipal Securities Disclosure Archive 5161 River Road 559 Main Street Bethesda, MD 20816 Hudson, MA 01749 (301) 951-1450 (800) 580-3670 FAX (301) 718-2329 According to a.Securities and Exchange Commission press release dated June 26, 1995, a list of names and addresses of all.designated Nationally Recognized Municipal Securities Information Repositories as of any point in time is available by calling the SEC's FAX On Demand Service at (202) 942-8088 from a telecopier machine and requesting document number 0206. . B-1 APPENDIX G SPECIMEN COPY OF MUNICIPAL BOND INSURANCE POLICY • • [This page intentionally left blank] • AMBAC Indemnity Corporation • Municipal Bond Insurance Policy44 CT Corporation Madison, Y A4 East Mifflin Sr., �tiladison,Wisconsin 53703 Administrative Office: • - • One Stare Street Plaza, New York, NY 10004 • • Telephone: (212) 668-0340 Issuer: Policy Number: Bonds: Premium: AMBAC Indemnity Corporation (AMBAC) A Wisconsin Stock Insurance Company in consideration of the payment of the premium and subject co the terms of this Policy, hereby agrees to pay r. h• United Stares Trust Company of New York, as trustee, or-its successor (the "Insurance Trustee"), for the benefit of Bon.•older• c :r portion of the prin- cipal of and interest on the above-described debt obligations(the"Bonds") which shall become Due f. 'ay b t ••all be unpaid by reason of Nonpayment by the Issuer. AMBAC will make such payments co the Insurance Trustee within one (1) business day • 1.• ng n..'fi••cio A - :AC of Nonpay- ment. Upon a Bondholder's presentation and surrender co the Insurance Trustee of suc u 'aid ', ds ..purten.nt coupons. un- canceled and in bearer form and free'of any adverse claim, the Insurance Trustee • o bu . c e B.•a elder the face amount of principal and interest which is then Due for Payment but.is unpaid. Upon suc •isb-rse •en AM: • s - I become the owner of the surrendered Bonds and coupons and shall be fully subrogaced ro all of r Bon• . •er ri• •rs • .av• `nc. In cases where the Bonds are issuable only in a form whereby princi p ..b ,: e: to . '.ndholders or their assigns, the Insurance Trustee shall disburse principal co a Bondholder as af.• -•d .o .r .e at -n and surrender ro the Insurance Trustee of the unpaid Bond, uncanceled and free of any adverse claim, •_e er •i . ins u t of assignment, in form satisfactory to the Insurance Trustee, duly executed by the Bondholder or >I . 's I a o••ed representative, so as co permit ownership of such Bond to be registered in the name of AMBAC or it o •-e n ••ses h. e ..e :onds are issuable only in a form whereby interest is payable to registered Bondholders or their assi•ns, rh lnsu ance at s' disburse interest to a Bondholder as aforesaid only upon presentation to the Insurance Trustee of p • •a. ch- laima the • .on entitled to the payment of interest on the Bond and delivery to the Insurance Trustee of an in - t of •ssi •menr i for satisfactory to the Insurance Trustee, duly executed by the claimant Bondholder or such Bondholder dul our -- ze•.rep - ca e, transferring to AMBAC all rights under such Bond to receive the interest in respect of which the -• u ce • .eme ade. AMBAC shall be subrogated to all the Bondholders' rights to payment on registered Bonds col, e ext •t of t- ins •- ce disbursements so made. In the event the trustee or .yi r •r ..e ..n. as notice char any payment of principal of or interest on a Bond which has become Due for Paym-• lc -e co a :o• older by or on behalf of the Issuer of the Bonds has been deemed a preferential transfer and therec• .re e•ever-• fr.- its registered owner pursuant co the United Stares Bankruptcy Code in accordance with a final, nonappealable or. r a co .f •m.-tent jurisdiction, such registered owner will be entitled to payment from AMBAC to the extent of such recovery s ienc fu • are of otherwise available. As used herein, the :on h.der means any person other than the Issuer who, at-the rime of Nonpayment, is the owner of a Bond or of a coupon appertai.. : • . -iond. As used herein, "Due for Payment". when referring ro-the principal of Bonds, is when the stated maturity dace or a ma - . - edempcion dace for the application of a required sinking fund installment has been reached and does not refer co any earlier dare on which,payment is due by reason of call for redemption (other than by application of required sinking fund installments), acceleration or other advancement-of Maturity; and, when referring co interest on the Bonds, is when the stated date for payment of interest has been reached..As used herein, "Nonpayment" means the failure of the Issuer to have provided sufficient funds to the paying agent for payment in full of all principal of and interest on the Bonds which are Due for Payment. This Policy is noncancelable. The premium on this Policy is not refundable for any reason, including payment of the Bonds prior co maturity. This Policy does nor insure against loss of any prepayment-or ocher acceleration payment which at any time may become due in respect of any Bond, ocher than at the sole option of AMBAC, nor against any risk ocher than Nonpayment. . In witness whereof, AMBAC has caused this Policy to be affixed with a facsimile of its corporate seal and to be signed by its duly authorized officers in facsimile co become effective as its original seal and signatures and binding upon AMBAC by virtue of the counter- signature of its duly authorized representative. 40. Amity co ok O'?'• V Cl�Cl_• 0 T :s1 SEAL President �� f Secretary • 114 Effective Dace: Authorized Representative UNITED STATES TRUST COMPANY OF NEW YORK acknowledges that it has agreed to perform the duties of Insurance Trustee under this Policy. Form.S66-0003(8/92) Authorized Officer AMBAC Indemnity Corporation c/o CT Corporation Systems . •44 East Mifflin Street Madison,Wisconsin 53703 Administrative Office: One State Street Plaza • Endorsement New York,New York 10004 Policy issued to: Attached to and forming part of Effective Date of Endorsement:. • • • • • • •The insurance provided.by this policy is not covered by the Florida Insu u ty s •ciation. . • • Nothing herein contained shall be hel. . . a er, • aive. e to nv of the terms,conditions,provisions,agreements or limitations of the above mentioned '. ► oth- t ,n. -b.,e• .ted. • In Witness,' ' reo ri he co 'has ca -d it's Corporate Seal to be hereto affixed.and thesepresents to be signed by its rp g duly authoriz d . face . . si le to become effective as its original seal-and signatures.and binding on the Company by virtue of cou ter !nature : .s. ly authorized agent. AMBAC Indemnity Corporation • ♦vAniry c\ • �?COFPOR,.Tf*�f 14. :1; SEAL 0 P 1::'•. .4 r:resident • Secretary, . _ Authorized Representative •Form#S2B-0004(3/90) Statute'.Chapter ess.ati.Ronda a - ,ek1 r eerei i exceei to angnee m pus"- a:Sections 14;rid 23,Tow iant3 Car€ rr 30,Section 33-1207:on prop- Pianneei L'arm,ptwzna PO and. Corp trig register werti en Dof s et ( ) et.- Corporations. Department of State, 'ness m•t(Xl4Bfuelaac Oak Drive:Dew 22. Range 28: Orange CrtoYunty, arty generate,located on Arafeye Trad Notice of Proposed Change a the publirstlon of this heticaState or Ronda upon receipt atf talio-the Developmerreof - Party interested in said bust- scno on proot of de.Ronda.11tba. Florida. is onThe file the office of 4) miles�soutthh and ta ke Underher ill Regional tImmpact(Dana on prper- tee name.Meet: ness enterprise are as Meows: the Comooaler Clerk of the Board Road:-District 4:-Sections 1 and 2. • ty generally located on.the north-.'A CAADSERVICEiNTER.NE7• LAURIE ANN MALIABEAG of County Commissioners.201 S. Township 23 South.Rarps 31 East Or- west.corner of Southland Boute- taiorfrwntan Iexport to engage in Duai- Dated at Oviedo. Seminole County. Rosalind Avenue.Fourth Fioor,Or- ange County,Florida.(The legal prop- vard and Sand Lake Road:District Hess at 1950 eadectt Perk Drive.Surta. Rance Novemoer•12.1996. lands,Floods 407.838-7300,1 arty description is on file in the caeca of et Seaton 27.Townstupp 23,Range es at 1950 FL 32810. • S1S1251088 • NOV.24.1996 All interested parties are invited to at- the Comptroller Clerk of the Boara of 29:Orange County,Flonda.(The.- That the party interested in said but- NOTICE UNDER FICTITIOUS tend and be heard. If you have any County Commissioners.201 S.Rosiu- legal property description is on•file ness enterprise is as tolows NAME STATUTE questions regarding the public Mar- and Avenue,Fourth Floor;Orlando,For- in the office of the.Comptroller CARDSERVICE INTERNATIONAL TO WHOM IT MAY CONCERN ' _•Inc,contact the Orange County Plan- ids:407-838-7300.) Clerk of the Board of County Con- INC. Notice is horsey given that the under- ping Department.407-838-561& All interested parties are invited to at- missioners,201 S.Rosalind Ave- Dated'ar Orlando, Orange•County, signed pursuant to the'Sr:thous Name Any person wsrung to appeal any dad- tend ana be heard_-If you have any ' nue.Fourth Floor,Orlando,Florida:.- Florae Novemoer 14.1996. • Statute',Chapter 865.09.Flonda Slat- Sian made by the Board of County questions regarding the public heanng. 407.836-7300.) •,' • - ' OLS1251131 NOV.24,1996 rites,will register with the Division of Commissioners at this meeting will contact the Orange County Planning • NOTICE UNDER FlCTTiTOl1S Corporations, Department of Slate, need a record of the proceedings-For Department.407-836-5600.- All interested parties are invited to•at� NAMEUNDER F1CT• State of Florida upon receipt of proof of that purpose.such person may need to Any person wishing to appeal are'Om- tend and be heard. If you have anyi TO WHOM IT MAY SCTATUTE • the publication of this notice.thence- ensure that a verbatim record of the sion made by the Board of County questions regarding the public hear- TO Noea is hereby given that tie order ners nine,to-yet proceedings is made,which record in. Commissioners at this meeting will Ing,contact the Orange County Plan- signed R rep to ivethedue v1SIBLE KEEPSAKES dudes the testimony and evidence up- need a record of the proceedings.For rang Department,tree lefeee00..'• q Statute', sham t the lactates.Florida NameSCE- under wean I expect to engage m Wet- on which the appeal is to be based, that purpose.such person may need to Any person wishing to appeal any dect- Statu e', register with the Division of ness at P.O.Box 520668,Longwood, In accordance with the Amencaris watt ensure that a verbatim record of the sion made by the Board of County Corpornti regins, erD with the o State, ee 327ueern' Disabdites Act(ADA-If person with proceedings is made-wfxor record u* Commissioners at this meeting wet Stateo of Flonda upon rodent of proof of That the party interested in said brae a disability as defined by the ADA dudes the testimony and evidence up- need a record of the proceedings.Fat the publication of this Wane,the tkch- -Hess Ise&e as felovise needs special accommodation to par- on which the appeal is to be based. that purpose,such person may need to Sousheubme to-wit nof 'MARY DEANS tidpate in this proceeding,then riot tat- In accordance with the Mnencam with ensure that a•verbatim record'of the name. HOSPITAL EAST ' Dated at Casselberty,Semmes Coon- er than two(2)business days pnor to -OisaplNes Act(ADA),A person wan 'proceedings Is made,which record iai FLORer wiles I expect m envier ORLANDOR in use Fiords November 19.1996. the proceeding,that person should vast a dieafaity as defined by the ADA dudes the testimony end evidence up. 'ness at les I Lake to Underhill Drive,Or- • S1251102 NOV.24,1996 'the General Services Department,Sec. needs special accommodation to par- on which me appeal is to be based. ' a 7727 Lake+. NOTICE UNDER FICTITIOUS' and Floor.Orange County Administra- ticipate in lets proceedrg,then not at. In accordance with the Americans with That theR i822. din said btsi- • NAME STATUTE Lion Center,201 South Rosalind Ave- er than two(2)business days error to Disabilities Act(ADA).if anyperson wait• Parry TO'WHOM IT MAY CONCERN • nue;Orlando.Florida,or telephone that the proceeding,that person should wart a disability-as defined-by•the ADA ness enterprise is es follows: department at 407-836-5500 or 836- the General Services Department.Sec- • needs special accommodation to par- ADVENTIST HEALTH SYSTEWSUN- Notice is hereby given that the under- 7372. and Floor.Orange County Adm,nistra- aapate in this proceeding,then not lat- BELT.INC. Signed pursuant to the'Fictitious Name Manna O.Haynie.County Comptroller lion Canter.201 South Rosalind Ave- er than two(2)business daysprior to Dated at Orlando, Orange County, Statute'.Chaoter 865.09.Flonda Stet- As Clerk of the Board of CountyCorn- nue.Orlando.Flonda or telephone thatp Florida November 13,1996. utes.will register with the Division of missioners department at 407-836-5500 or S36- the General Services,mat pDe..On meat.visit OLS1251391 NOV.24.1996 Corporations. Department of State, rraarngg the Floor, rnge County Administra- StateSec- of Florida upon receipt of proof of OLS7232492 Florida NOV.24.1996 Martha 0.Hand Floor,Orange NOTICE UNDER FICTITIOUS Haynie.CountyComptroller lion Center.201 South Rosalind Ave- the publication of this notice,the lice- AS Clerk of ilia Boars of CountyCom- NAMI STATUTE toes name.to-wit NOTICE OF PUBUC HEARING nue,Orlando.Florida,or telephone that TO WHOM IT MAY CONCERN GROVEN.EW VILLAS APARTMENTS The Orange County Board of County ssioners Ora ge C department at 407-836-5500 or 836- Notice is neretry given that the under- 9e County,Florida 7372 under wnith we are engage°in bust- Commissioners will conduct a puplic OLS1232576 NOV.24,1996 signed Pursuant to me'Fimtious Name Hess at 13411 Grovewew Way,Sanford, hearing on December 10, 1996, at 2 - Marta O.Haynie,County Comptroller' Statute'.Chapter 865.09.Florida Stat- FL 32773, p.m.,or as soon thereafter as possible, NOTICE OF PUBLIC HEARING As Clerk of the utesComo l register witht the hetDivision State. That the party interested in said bust- in the County Commissioners'Chain- The Orange County Board of County O roe Co Crtunt.yt honda- rs CSlare of tFlons. upon tmen prSte. ness•enterprse is as follows: bees.Frst Floor.County Atlminstration Commissioners will conduct a public OI.Sg1233751 NOV.24,1996 the Puf Gorda u of this notice,receiptof tpr fit al . GROVEVIEW UMITED 'Center,201 South Rosaluhd Avenue.Or- hearing on December 10,1996,at 3:30m thous name.to•wit • 1637 East Vine St.Suite E lando,Florida,to consider: p.m.,o as soon thereafter as possible, NOTICE OF PUBUC HEARING GUi to COLLISION CENTER' Kissimmee.Florida 34744. A permit application renewal by in the County Commissioners'Chem- • CITY OF OCOEE under which t is Od In NTries - Dated at Sanford.Seminole County, Project ABC,Whlspenvood to ell • bars-Frst Roo,Cou ty Atlmmtstravon Notice is hereby �r�ant to the at• erhickSafe Star Road.d ndo ness Fonda'November 15.1996 and dredge portions of two exist- Center.201 South Rosabrd Avenue,Or- Charter of the C df Ocoee,Florida, 2733 OLS1251111 NOV24.1996 Ing borrow pit lakes under the lando.Flanda lo.eonsder. that the Board of ity commissioners at dThat the Party interested in SZDid Lakeshore Protection Ordinance The Wate tord Lakes Maimed De- - a session to be herd December3,1996, ness enterprise s to according to Orange County Code. veropmont Tract Nit Preliminary at 7:30 p.m„will hold a Public Hearing CAA-0rpAN,INC.,a Fondaw= corpora- ' f I. PUBLIC HEARING • Chapter 15.Article Vi.on property Subdivision Plan,suomittea in ac- at the Ocoee City Hall.150 North Laue- ndri. - NOTICES adjacent to Whlaperwood take cordance with Chapter 65-2015. snore-Onve.Ocoee,Florida m oiler to Gated at Orlando. Cdunry, and an unnamed pond,generally Laws of Florida.and Article VI of consider the issuance of a not to exa Ponca. at an 13 1r Orange located ar'the southwest comer of the Orange County Subdivision coed S12.000.000 Water and Sewer Pon . tlo 3 NOV.24,1996 Notice of Intent to use the Uniform John Young Parkway and Central - Regulations:on property generate, System Revenue Bonds.Genes 1997 to Method for Collection of Non-ad vino- Florida Parkway: District 1; Sec- located south of S.A.50 and east finance the construction and certain im- NOTICE UNDER FICTITIOUS rem assessments: On December non 9.Towner°24 South.Range of Alataya Trail:District 4:Seaton provements to the combined water and NAME LAW 21996,@ 2 p.m..or as soon thereafter 29 East:.Orange County,-Fonda 26. Townsnip 22 Range 31; Or- sewer systems. NOTICE IS HEREBY GIVEN.Under as the matter may be heard.tie City (The legal property description is ange County, Flonda (The legal Interested parties may appear at trite th Chapter SO-267-that the undersigned. Council of the City of Orlando.Flonda on file in e odce of the Comotrot- property description ison filein the meeting and be heard with respect to deswing to engage in cuteness under wet hold a-public hearing in Council ler Clerk of the Board of County•• office of the Corl ttnailer Clerk of the proposed action.A copyof the prd- the Fictitious Name of POINTE VISTA Chambers:City Hall.and Fir.,400 S. Commissioners.;201.S. Rosalind the Board of County Commission- posed anion may be examined at City APARTMENTS Located at 5455 0 Ave.,to consider the adoption Avenue. Fourth Floor, Orlando. ere, 201 S. Rosalind Avenue, Hail. 150 N.Lakesnore'Ome.Ocoee, POINTE VISTA CIRCLE in the City of ofrsa Resolution of intent to use the um- Florida:407-836-7300.) Fourth Floor,Orlando.Ronda:407- Florida,between the hours of 8:00 am. ORLANDO.ORANGE County,Florida, form method for collection'of non-ad All interested parties are invited to at- 836-7300.1 and 5;00 p.m.,Monday through Friday' intends to register the said name with valorem assessments as authanzed by tend and be heard. If you have any All interested parties are invited to at- You are advised that it's person are- na Division of Corporations of the De- Section 197.3632.Ronda Statutes.This questions regarding the public hear- tend and be nears. If you have any ales to appeal any decision made with seem'of State. non-ad valO een seen assessment will Ing,contact the Orange County Envl- questions regarding the public hear- respect to any matter considered at Oaten at Tatlanassee. Flonda this be levied for the first time.Suc n Resolu- ronmental Protection Department. Ing,contact the Orange County Pub- sucn hearing,he or she will need a me- the 19TH day of NOVEMBER,199& lion viol state the need for the levy& 407-836-7400. Iic Works DMsion,407-836-7856. • acord of proceedings.and for such put- OWNERS: - reel.in the tom of an exhibit cornam a Any person whsleig to appeal any deal- Any person vesting to appeal any des- pose may need to ensure that a vera} POINTE VISTA LTD. • legal desahption of the boundaries of sion made ey the Board of County sion made by the Board.at County aim record of the proceeding is made. OLS1251419 NOV.24.1993 real prboerry subject to the levy.All in- Commissioners at this meeting will Commissioners at this meeting will 'mach record inaudes Me tesamony-and NOTICE UNDER FlCITTIOUS 'terested persons may appear & be need a record at tee proceedings For •need a record at the proceedings.For evidence upon wnici the appeal is NAME LAW herd regard' the use of the uniform that purpose.srcn person may need to that purpose,such person may need to based.Persons with disabilities need- NOTICE IS HEREBY GIVEN.Under method for col ection of such non-ad ensure that a•vet-oaten record of the ensure that a verbatim record of the ing assistance to participate in any of ChChapter 90.267.that the undersigned, valorem assessments.The City Council peoceedutgs.is made,wniat record in- proceedings is made-•whidn record in- these proceeeirigs should contact the apter to engage5 .thin buisness under does hereby provide Notice,pursuant dudes the to ienoty and evidence up- dudes the testimony ana evidence uo- City Cleric's office 48 hours in advance tee rinFit:g to of B r to Sec ton 197.3532(3)(a),Flonda Stat• on witch the appeal is to be neeert, on wrecm the appeal is to be Dated. of the meeting at(407)656-232,'..;le ERS LocatedsName at o RUBIN uses.of its'intent to use the untfonm In accordance with the Americans with In accordance with the Americans with Jean Grafton,City Clerit ERS in the City 4 24 SEABOARD ���on of nonad vakxem Disanilities Act(ADA),if any person with Disabilities Act IADA),if any person with November 24,1996 ROAD County.Florida. OR- i ORLANDO.to rags- assessments for the cost of design, a disability as defined by the ADA a disability as defined by the ADA aOLS1248778. NOV.24 1 ANGE the said name,rwith the Division s- on&other capital odlea ex- needs special accommodation to par- needs special accommodation to par- NOTICE OF PUBLIC HEARING terpelves 3 toss associated with tie is- ticOate in this proceeding,then not lax- tiapate in this Proceeding,then not lat- of Coroorapons of the Department ofCITY OF en= I State nuance of debt obaigaterc as all such er than two 12)business days anon Ti er than two(2)g business days prior to Notice is hereby coven pursuant to the Dated at Tallahasee. Florida this costs rebate to a road hnterdtange m the the prbcaetlaag,that person snand vent •tea Proceeding,that person should visa Charter of the City of Ocoee.Florida, • tunarm a Iriteratate Highway 4&Con- the General Services Department Sec- the General Services Department Sec- he I9TH day a NOVEMBEfT,1996 row Road_The benefit area potentially and Floor.Orange CountyAdminrstra- and Floor.Orange Co Administra- that the Board at OWNERS: I a session to be held December 3,1996, subect to the special assessment con- non Center.201 South Rosalind Ave- Lion Center.201 South Rosalind Ave-. at 7:3p m.,will hold a Public Hearing RUBINOLS12 BROTHERS,INC. P• nrJ OLS7251422 NOV.24.7996 stsrs generally of panics within the City nue.Orlando.Rohde.or telephone that Hue.Orlando.Flop°a-or teledhone that at the Ocoee City Hall,150 North Lake- UmrLs in the vicinity of the road inter- department at 407-836-5500 or 836- department at 407-836-5500 or 836- snore Drive.Ocoee.Flonda in order to NOTICE UNDER FICTITIOUS mange,as such area is more oartior- 7372 7372 - consider a resolution authorfzmg•the NAME STATUTE - laity identified in the legal descnpbon Manila O.Haynie.County Comptroller • Manna O.Haynie.Comity Comptroller execution and delivery of a loan agree- TO WHOM IT MAY CONCERN attached to the Resolution of intent. As Cleric of the Board of County Corn- As Clerk of the Board of County Corn- mere and atoms'sory note and the tor- Notice is nereoy given that the under- .Persons wishing ro appeal arty decision nr vaePois • •mssioners rowing of$4',840,000 to finance the cast signed pursuant to the'Fictitious Name made by the Cihraeaunal with respect Orange County,Florida • Orange County,Fonda Statute'.Chapter 865.09.Florida Stet- to any matter re(a'"ng to the consider- OLS1232533 .NOV24.1996 OLcl233011 NOV.24.1996 of certain apical improvements Band !lactates and ✓ - - .. .certain non ad construcaontvabre n revenues of hthhe - ' ' • City to secure payment of the promos- say note Interested parties may appear at the • meeting and be heard with respect to . . . • the proposed eaten.A copy of the pro- . eased action may be examined at Cite/. - - - -- - Hale. 150 N.Lakeshore Onve,Ocoee, . Flonda,between the hours of 8:00 a.m- and 5:00 p.m..Monday through Friday. You are advised that it a person de- odes to appeal any decision made with respect to any matter considered at such hearing.he or she will need a re- cord of proceedings and for such our- ' pose may need to ensue that a verba- tim record of the proceeding ha made. Mhirh record inardos the testimony and evidence upon wnirh the appeal is based.Persons with disabilities need- ing assistance to pamapate.in any of these prpceeakgs should contact the City Plates artier 48 Houra m advance cattle msetng at(407)656-2322 Jaen Grafton.City ark losdmber 24.1996 ilk., O1S1248801 NOV.24,1996 e