SEPTEMBER 19, 1989
'WORLD'S LARGEST RESORT CITY'
CITY COUNCIL
MAYOR MEYERA E. O.EMWW. A@
V7CE MAWR ROBERT E. PEN7,ffM. V,,gi.@ &@h @h
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AU.-Y V. A@@. JR., Cil, CITY COUNCIL AGENDA VIRGINIA BEACH, VIRGINIA 23456-9002
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S P E C I A L S E S S I 0 N
SEP=ER 19, 1989
ITEM I. SPECIAL R-ORMAL SESSION - Council Chamber 12:30 PM
A. CALL TO ORDER - Mayor Meyera E. Oberndorf
B. READING OF MAYOR'S CALL TO SPECIAL SESSION
C. ELECTRONIC ROU CALL OF CITY COUNCIL
D. LOW BID: $40,210,000 General Obligation Public Improvement Bonds,
Series of 1989A
E. RATE OF INTERE-ST: $2,000,000 General Obligation Public Improvement
Bonds, Series of 1989B (Capital Appreciation
Minibonds).
F. CITY MANAGER'S RECOMMENDATION
G. AWARDING LOW BID:
$40,210,000 General Obligation Public Improvement Bonds,
Series of 1989A
H. ESTABLISHING TIIE- RATE- OF INTEREST:
$2,000,000 General Obligation Public Improvement Bonds,
Series of 1989B (Capital Appreciation Minibonds).
I. ADJOURNMENT
M I N U T E S
VIRGINIA BEACII CITY COUNCIL
Virglnia Beacli, Vlrginia
September 19, 1989
The SPECIAL SESSION of the VIRGINIA BEACH CITY COUNCIL was called to order by
Mayor Meyera E. Oberndorf in the Council Conference Room, City Fall Building,
on Tuesday, September 19, 1989, at 12:30 P.M.
Council Members Present:
Albert W. Balko, John A. Baum, Vice Mayor Robert E.
Fentress, Harold Heischober, Barbara M. Henley, Mayor
Meyera E. Oberndorf, Reba S. McClanan, Nancy K. Parker
and John L. Perry
Council Members Absent and Excused:
John D. Moss and William D. Sessoms, Jr.
- 2 -
Item I.B. ITFII # 31840
The MAYOR read her LETTER stating the purpose of the SPECIAL SESSION:
"In accordance with the City Charter, Section 3.06,
the City Code, Section 2-21, and by the authority
vested in me as Mayor of the City, I hereby call a
SPECIAL SESSION of the VIRGINIA BEACH CITY COUNCIL
in the Council Chamber, City Hall Building, on
Tuesday, September 19, 1989, at 12:30 P.M., for the
purpose of AWARDING a Low Bid on $40,210,000
General Obligation Public Improvement Bonds, Series
of 1989A; and, ESTABLISHING the rate of interest
for the $2,000,000 General Obligation Public
Improvement Bonds, Series of 1989B, Capital
Appreciation Minibonds.
S/Meyera E. Oberndorf
Mayor
MEYERA E. OBERNDORF MUNICIPAL CENTER
MAYOR September 11, 1989 VIRGINIA BEACH, VIRGINIA 23456-9002
(804) 427-4581
HONORABLE MEMBERS OF CITY COUNCIL
In accordance with the City Charter, Section 3.06, the City
Code, Section 2-21, and by the authority vested in me as Mayor of
the City, I hereby call a SPECIAL SESSION of the VIRGINIA BEACH
CITY COUNCIL in the Council Chamber, City Hall Building, on
Tuesday, September 19, 1989, at 12:30 P.M. for the purpose of
AWARDING a Low Bid on $40,210,000 General Obligation Public
Improvement Bonds, Series of 1989A; and, ESTABLISHING the rate of
interest for the $2,000,000 General Obligation Public Improvement
Bonds, Series of 1989B, Capital Appreciation Minibonds.
Respectfully,
@e
Meyera E. Oberndorf
Mayor
MEO/bh
cc: Aubrey V. Watts, Jr., City Manager
Kevin Cosgrove, Acting City Attorney
Ruth Hodges Smith, CMC/AAE, City Clerk
Pam Lingle, Director of Public Information
Virginia Beach City Council Received Notice
Councilman Albert W. Balko
Councilman John A. Baum
Councilman Robert E. Fentress
Councilman Harold Heischober
Councilwoman Barbara M. Henley
Councilwoman Reba S. McClanan
Councilman John D. Moss
Councilwoman Nancy K. Parker
Councilman John L. Perry
Councilman W. D. Sessoms
- 3 -
Item I.D. ITEM # 31841
LOW BID
Giles Dodd, Assistant City Manager for Administration, advised the City of
Virginia Beach has received six separate bids on its $40,210,000 General
Obligation Public Improvement Bonds, Series of 1989A.
The true interest cost to the City of each of the bids is as follows:
Syndicate Headed By % True Interest Cost
Merrill Lynch Capital Markets 6.95286
Harris Trust and Savings Bank 6.9715
Manufacturers lianover 6.998158
Prudential - Securities 7.0292
BT Securities Corp. 7.0301
First Boston Corp. 7.0423
Tile City's financial advisors, Government Finance Associates, Inc. and the
Government Finance Research Center recommended the City accept the low bid of
Merrill Lynch Capital Markets.
- 4 -
Item I.E. ITE14 # 31842
RATE OF INTEREST
Giles Dodd, Assistant City Manager for Administration advised for the purposes
of selling the City's $2,000,000 General Obligation Public Improvement Bonds,
Series of 1989B (Capital Appreciation Minibonds), the City must set the
interest rates and the accreted values of the bonds on the three maturity
dates.
Based on the interest rates received on the City's $40,210,000 General
Obligation Bonds (Capital Appreciation Minibonds), the following interest rates
and the accreted values of the Minibonds were recommended to be established:
Interest Rates and Accreted Value Schedule
Accreted Value at
Redemption Date Interest Rate maturity per $500
October 12, 1992 6.2% 600.51
October 12, 1993 6.3% 640.80
October 12, 1994 6.4% 685.12
- 5 -
Item I.G/H. TTEM # 31843
AWARDING THE LOW BID
ESTABLISHING THE RATE OF INTEREST
Upon motion by Vice Mayor Fentress, seconded by Councilwoman Parker, City
Council ADOPTED:
Resolution awarding $40,210,000 General Obligation
Public Improvement Bonds, Series of 1989A and
setting interest rate on $2,000,000 General
Obligation Public Improvement Bonds, Series of
1989B (Capital Appreciation Minibonds)
AWARDED Low Bid on the $40,210,000 General
Obligation Public Improvement Bonds, Series of
1989A to Merrill Lynch Capital Markets with a
True Interest Cost of 6.95286%
The interest rates on the $2,000,000 General
Obligation Public Improvement Bonds, Series of
1989B (Capital Appreciation Minibonds) are
Established as follows:
1992 6.2%
1993 6.3%
1994 6.4%
Voting: 9-0
Council Members Voting Aye:
Albert W. Balko, John A. Baum, Vice Mayor Robert E.
Fentress, Harold Heischober, Barbara M. Henley, Reba
S. McClanan, Mayor Meyera E. Oberndorf, Nancy K.
Parker and John L. Perry
Council Members Voting Nay:
None
Council Members Absent:
John D. Moss and William D. Sessoms, Jr.
Councilwoman McClanan DISCLOSED, although it does not affect her ability to
vote, her children have cash management accounts with Merrill Lynch.
Councilwoman Parker DISCLOSED, although it does not affect her ability to vote,
she also has cash management accounts with Merrill Lynch.
1 RESOLUTION AWARDING $40,210,000 GENERAL OBLIGATION
2 PUBLIC IMPROVEMENT BONDS, SERIES OF 1989A AND
3 SETTING INTEREST RATE ON $2,000,000
4 GENERAL OBLIGATION PUBLIC IMPROVEMENT BONDS,
5 SERIES OF 1989B (CAPITAL APPRECIATION MINIBONDS)
6
7
8 WHEREAS, the Council of the City of Virginia Beach, Virginia
9 (the City), by resolution adopted on September 11, 1989 (the Series
10 of 1989A Resolution), authorized the sale of $40,210,000 General
11 Obligation Public Bonds, Series of 1989A (the series of 1989A
12 Bonds); and
13 WHEREAS, pursuant to sale procedures set forth in the City's
14 Notice of Sale, sealed bids for the Series of 1989A Bonds are
15 received in the office of the City Manager at 11:00 a.m., local
16 time, on this date. Each of the bids of f ered to pay par, a premium
17 as indicated and accrued interest on the Series of 1989A Bonds from
18 the date of the Series of 1989A Bonds to the date of delivery:
19 1. Bid of Merrill Lynch Capital Markets, offering to pay a
20 premium of $ -0- for the Series of 1989A Bonds bearing interest
21 at the rates set forth in Column 1 on Exhibit A attached.
22 2. Bid of Harris Trust and Savings Bank, offering to pay a
23 premium of $ 5,480.30 for the Series of 1989A Bonds bearing
24 interest at the rates set forth in Column 2 on Exhibit A attached.
'@ 5 3. Bid of Manufacturers Hanover Securities, off ering to pay
26 a premiurn of $ 5,028.70 for the Series of 1989A Bonds bearing
27 interest at the rates set forth in Column 3 on Exhibit A attached.
28 4. Bid of Prudential Bache Securities, offering to pay a
29 premium of $ 2,708.60 for the Series of 1989A Bonds bearing
30 interest at the rates set forth in Column 4 on Exhibit A attached.
31 5. Bid of B. T. Securities Corp., offering to pay a premiwn
32 of $ 197.70 for the Series of 1989A Bonds bearing interest at the
33 rates set forth in Column 5 on Exhibit A attached.
34 6. Bid of First Boston Corp., offering to pay a premium of
35 $ 1,852.50 for the Series of 1989A Bonds bearing interest at the
36 rates set forth in Column 6 on Exhibit A attached.
37 WHEREAS, representatives of the Government Finance
38 Associates, Inc. and Government Finance Research Center, the City's
39 financial advisors reported that the bid of, Merrill Lynch Capital
40 Markets, a copy of which bid is attached hereto, of f ered to
41 purchase the Series of 1989A Bonds at the lowest cost to the City,
42 determined in accordance with the Notice of Sale, and recommended
43 acceptance of the bid; and
44 WHEREAS, the Council of the City of Virginia Beach, Virginia
45 by resolution adopted September 11, 1989 (the Series of 1989B
46 Resolution), authorize the sale of $2,000,000 General Obligation
47 Public Improvement Bonds, Series of 1989B (Capital Appreciation
48 Minibonds) (the Series of 1989B Bonds); and
49 WHEREAS, the Series of 1989B Resolution provided that the
50 interest rate on the Series of 1989B Bonds be determined at the
51 time of the sale of the Series of 1989A Bonds;
52 NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF
53 VIRGINIA BEACH, VIRGINIA THAT:
54 1. The Series of 1989A Bonds, the form and details of which
55 have heretofore been prescribed by the Series of 1989A Resolution
56 are hereby awarded to Merrill Lynch Capital Markets in accordance
57 with the terms of their bid and shall bear interest as set out in
58 such bid.
59 2. The interest rates on the Series of 1989B Bonds are as
60 follows:
61 YEAR INTEREST RATE
62
63 1992 6.2%
64 1993 6.3%
65 1994 6.4%
66
67 Adopted this 19th day of September, 1989, by the Council of
68 the City of Virginia Beach, Virginia.
69 APPROVED:
70
71
72
73
74 MAYOR
75 09/19/89
76 noncode/res/bondawar
39 financial advisors reported that the bid of, Merrill Lynch Capital
40 Markets, a copy of which bid is attached hereto, of f ered to
41 purchase the Series of 1989A Bonds at the lowest cost to the City,
42 determined in accordance with the Notice of Sale, and recommended
43 acceptance of the bid; and
44 WHEREAS, the Council of -,he City of Virginia Beach, Virginia
45 by resolution adopted September 11, 1989 'the Series of 1989B
46 Resolution), authorize the sale of $2,000,000 General Obligation
47 Public Improvement Bonds, Series of 1989B (Capital Appreciation
48 Minibonds) (the Series of 1989B Bonds); and
49 WHEREAS, the Series of 1989B Resolution provided that the
50 interest rate on the Series of 1989B Bonds be determined at the
51 time of the sale of the Series of 1989A Bonds;
52 NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF
53 VIRGINIA BEACH, VIRGINIA THAT:
54 1. The Series of 1989A Bonds, the form and details of which
55 have heretofore been prescribed by the Series of 1989A Resolution
56 are hereby awarded to Merrill Lynch Capital Markets in accordance
57 with the terms of their bid and shall bear interest as set out in
58 such bid.
59 2. The interest rates on the Series of 1989B Bonds are as
60 follows:
61 YEAR INTEREST RATE
62
63 1992
64 1993
65 1994
66
67 Adopted this 19th day of September, 1989, by the Council of
68 the City of Virginia Beach, Virginia.
69 APPROVED:
70
71
72
73
74 MAYOR
75 09/19/89
76 noncode/res/bondawar
S@ed bids must bc submitted by 11:00 am
OFFICIAL BID FORM
Scptember 19, 1989
City Council
Ciii of Vir@ Bcach
c/6 Office of thc City Managcr
Virginia Beach Municipal Center
Citi HaU Building
VirgWa Brach, Virginia 23456
Dear Sir:
On behalf of the group listcd below and pursuant to the terms and conditions of sale listed in thc Citys Noticr
of Salc, we offcr to purchase the $40,210,000 General Obfigation PubEc Improvcment Bonds, Scries of 1989A of thc City
of Virginia Bcach, Virginia, dated Octobcr 1, 1989. This offer is madc f6r aH of said Bonds and for not Icss than aH,
maturing on October I in thc years shown below.
The schedule of maturitics and intcrest ratcs upon which this bid is bascd arc as fohows:
Interest
-Mat.l!rity Ainount Maturity Amount Z=
10 I 2,015,000 10/1/2000 $2,010,000 6 I
10 1 $2,015,000 10/1/2001 2,010,000 u
10@l@9912 $2,010,000 el 0 10/1 2 2,010,000 -i-,
10/1/93 2,010,000 go 10/1@2000032 $2.010,000
10/1/94 $2,010,000 10/1/2004 $2,010,000
10/1/95 $2,010,000 10/1@2005 $2,010.000
10/1/96 $2,010,000 10/1/2006 $2,010@,000
10/1/97 $2,010,000 6 -42 10/1/2007 $2,010,000 -7- 0 0
1 @l//Qg $2,010,000 10/1/2008 @oio.ooo 7,
0
10 1/99 $2,010,000 10/1/2009 $2,010,000 7.;o
We wifl pay $40,210,000 plus a prem ium of $ - 0 - and accrued intcrcst from the date of the Bonds to the.
date of dclivcry and wifl acce dchvcry of the Bon s y mcans of a book-entry system at The Depository Trust
Company, New7York, Ncw Yor
We enclose a certiricd or cashices check for $804,200 drawn ui>on an incorporatcd bank or trust company and
payablc unconditionally to thc order of thc City of Virginia Bcach, Viiginia, which is to be applied in accordancc with
ihe Notice of Bond Saic to sc-curc thc City against any loss resulting from the failure of the succcssful biddcr to comply
with the terms of this proposal. The chcck of the successful biddcr wiR be dcpositcd and credited on the purchasc price,
and no interest will be credited thereon. The proceeds of the check wiU bc rctained by the City as Equidated damagcs in
case thc successful biddcr fails to accept dcfivcry of and pay for thc Bonds. Checks of unsu@ful bidders wifl bc
returned promptly upon award of the Bonds.
RespectfuUy,submittrd,..,
MERRILL LYNCH CAPITAL MARKETS
and Associates
Managige Dir6ctor
The above good faith chcck has been rcturncd
and receipt thercof is duly acknowlcdged.
NO ADDITION OR ALTERATION, EXCEPT AS PROVIDED
ABOVE, SHOULD BE MADE TO THIS BID
TE 7r, following is stated for information only and is not a part of this bid: The Truc Intercst Cost of bid is
and the total amount of interest payablc on thc Bonds (net of accrued intcrest) is s
3,?Sl 2 2 S-, 0 0
6
Item I-I.
ADJOURNMFIff ITEM 31844
Upon motion by Vice @layor Fentress, seconded by Councilman Baum, BY CONSENSUS,
City Council ADJOURNED the Meeting at 12:45 P.M.
a@ 0 @@
Beverly 0- Hooks
Chief Deputy City Clerk
Uth Hodg@s Smith, CMC M.@y.@. Obern
City Clerk Mayor
City of Virginia Beach
Virginia