640 TOWN OF TAGS
ORDI NANCES �
YEAR, 19 '76
NUMBER:
dy �� was
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STATE OF NEW MEXICO )
COUNTY OF TAOS ) SS.
)
TOWN OF TAOS )
The Board of Trustees of the Town of Taos in
the County of Taos and State of New Mexico, met in public
regular session, in full conformity with law and the or-
dinances and rules of said Board at the Town Hall (i .p. ,
the Town ' s Municipal Offices) on Armory Street, in the
Town of Taos, being the regular meeting place of said
Board at the hour of 7:30 p .m. , on Thursday _ , the loth
day of June, 1976 , and upon roll call the following were
found to be present, constituting a quorum:
Present:
Mayor: Phillip Cantu, Jr.
Trustees : Lawrence Santistevan
Fernando Valdez
Joe A. Sanchez
Absent•: Eloy Jeantete
constituting all the members thereof.
There were also present:
Clerk-Treasurer: Josephine Gonzales
Town Attorney: James M. Brandenburg
City Manager: Ernest Romero
Thereupon, the following proceedings, among
others, were had and taken, to wit:
Trustee Fernando Valdez introduced the fol-
lowing ordinance which is as follows :
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ORDINANCE NO. 64o
AN ORDINANCE PROVIDING FOR THE EXTENSION, EN-
LARGEMENT, BETTERMENT AND OTHER IMPROVEMENT OF
THE MUNICIPAL JOINT WATER AND SEWER SYSTEM OF
THE TOWN OF TAOS, NEW MEXICO; DECLARING THE
NECESSITY FOR MAKING AND ISSUING THE TOWN 'S
JOINT WATER AND SEWER EXTENSION REVENUE BONDS,
PAYABLE SOLELY OUT OF THE NET INCOME TO BE
DERIVED FROM THE OPERATION OF SUCH JOINT SYS-
TEM; AUTHORIZING THE ISSUANCE AND SALE OF SUCH
REVENUE BONDS IN THE AGGREGATE PRINCIPAL AMOUNT
OF $500, 000; PROVIDING FOR THE DISPOSITION OF
THE INCOME TO BE DERIVED FROM THE OPERATION OF
SAID JOINT SYSTEM; ADOPTING BY REFERENCE CER-
TAIN PROVISIONS OF ORDINANCE NO. 528 , ADOPTED
AND APPROVED ON JULY 1, 1963 ; PRESCRIBING OTHER I
DETAILS CONCERNING SAID REVENUE BONDS, INCLUD-
ING BUT NOT LIMITED TO COVENANTS AND AGREEMENTS
IN CONNECTION THEREWITH; RATIFYING ACTION PRE-
VIOUSLY TAKEN CONCERNING SAID JOINT SYSTEM AND
SAID BONDS; REPEALING ALL ORDINANCES IN CON-
FLICT HEREWITH; AND DECLARING AN EMERGENCY. ' f
WHEREAS, the Town of Taos (herein "Town") , Taos
County, New Mexico, now owns, operates and maintains a
joint public utility constituting a joint water and sewer
system (herein sometimes designated as the "system" , the
"joint system" or the "joint utility" ) ; and
WHEREAS, the Town pursuant to Ordinance No. 528 ,
duly adopted and approved on July 1, 1963 , has heretofore
issued and delivered all bonds of the issue designated
"Town of Taos Joint Water and Sewer Refunding Revenue
Bonds, Series July 1, 1963" (herein the "1963 Bonds") , in
the aggregate principal amount of $405 , 000, dated July 1 ,
1963 , consisting of 45 bonds in the denomination of $1, 000
and $5, 000 each, of which issue there are outstanding and
unpaid bonds in the aggregate principal amount of
$215 , 000; and
WHEREAS, all of the bonds refunded by the 1963
Bonds now have been paid in full and redeemed, e.g. , prin-
cipal, interest and any prior redemption premium; and
WHEREAS, pursuant to Ordinance No. 621, duly
adopted and approved on the first day of May, 1973 , the
Town has issued its "Town of Taos Joint Water and Sewer
Extension Revenue Bonds, Series May 1, 1973" (herein the
"1973 Bonds") , in the aggregate principal amount of $200 , 000,
consisting of 40 bonds in the denomination of $5 , 000 each,
of which issue $195 , 000 of the bonds remain outstanding;
and
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WHEREAS, except as aforesaid, the Town has
never pledged nor in any way hypothecated revenues de-
rived and to be derived from the operation of the system,
or any part thereof, to the payment of any bonds or for
any other purpose (excluding proceedings authorizing the
issuance of bonds which have heretofore been redeemed in
full, both principal and interest) with the result that
the revenues to be derived from the system may now be
pledged lawfully and irrevocably for the redemption of
additional bonds payable from revenues derived from the
operation of the system; and
WHEREAS , Section 19 of such Ordinance No. 528
(herein "Ord. No. 528") and Section 20 of such Ordinance
No. 621 (herein "Ord. No. 621") specify limitations upon
issuance of parity obligations, but such limitations
presently may not be met and also may not be met at the
time of the delivery of the bonds; and
WHEREAS, the present water facilities and sewer
facilities of the Town are insufficient, and the present
joint system is inadequate to meet the needs of the Town
and the inhabitants thereof; and
WHEREAS, the Board of Trustees of the Town
(herein sometimes designated as the "Board" or the "Gov-
erning Body" ) has determined, and does hereby determine
that it is necessary and for the best interest of the
Town and the inhabitants thereof that its joint system
be extended, enlarged, bettered and otherwise improved;
and
WHEREAS , the gross income anticipated to be de-
rived from the system is in excess of requirements for
operation and maintenance of the system and the payment
of the outstanding 1963 Bonds and 1973 Bonds and pursu-
ant to the statutes of the State of New Mexico such excess
income may lawfully be pledged to secure the redemption
of the 1976 Bonds herein authorized to be issued (provided
that such 1976 Bonds shall have a lien on the net revenues
of the system which is junior and subject to the liens
thereon of the 1963 Bonds and the 1973 Bonds) ; and
WHEREAS, the United States of America, acting
by and through the Farmers Home Administration (herein
"FmHA" ) , United States Department of Agriculture, has
agreed to purchase the bonds herein authorized at par and
an interest rate of 5% per annum.
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NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING
BODY (I. . , THE BOARD OF TRUSTEES) OF THE TOWN OF TAOS,
NEW MEXICO:
Section 1. Definitions.
A. Adoption of Certain Definitions. The
following designated terms , namely: Independent Account-
ant, Insured Bank, net revenues, net income, operation
and maintenance expenses, revenues, gross revenues, income
and gross income, being defined for all purposes of this
ordinance and of any ordinance amendatory hereof or supple-
mental hereto, or relating hereto, and of any instrument
or document appertaining hereto, except where the context
by clear implication otherwise requires, shall have the
meanings set forth in Section 1 of Ord. No. 528 , which
meanings are hereby adopted by reference thereto as if set
forth verbatim in full in this ordinance; provided, however,
that all references in said Section 1 of Ord. No. 528 to
"this ordinance" shall be construed as referring to the or-
dinance herein set forth and not to Ord. No. 528 .
B. Other Definitions :
(1) "Bonds" or "1976 Bonds" means the
"Town of Taos Joint Water and Sewer Extension Revenue Bonds ,
Series 1976" , authorized by this ordinance (including any
single bond as provided herein) .
(2) "1973 Bonds" means the "Town of
Taos Joint Water and Sewer Extension Revenue Bonds, Series
May 1, 1973" , authorized by Ord. No. 621.
(3) "1963 Bonds" means the "Town of
Taos Joint Water and Sewer Refunding Revenue Bonds, Series
July 1, 1963" , authorized by Ord. No. 528.
(4) "Ord. No. 528" means Ordinance
No. 528 of the Town which was adopted and approved by the
Board on July 1, 1963.
(5) "Ord. No. 621" means Ordinance
No. 621 of the Town which was adopted and approved by the
Board on May 1, 1973.
(6) "Board" or "Governing Body" means
the Board of Trustees of the Town or any succeeding legis-
lative body of the Town, as such body from time to time
may be constituted.
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z
(7) "Consulting Engineer" means any
registered or licensed professional engineer or firm of
such engineers having a wide and favorable repute for
skill and experience in the field of designing, preparing
plans and specifications for, and supervising construction
of water systems and facilities, and sewer systems and
sewer facilities, entitled to practice and practicing as
such under the laws of the State of New Mexico, retained
and compensated by the Town, but not in the regular em-
ploy of the Town; but, as to any construction drawings
and specifications prepared for the Project by Town em-
ployees working on force account or otherwise under the
supervision of the Town Engineer, this term may include
the Town Engineer.
(8) "Fiscal Year" means the twelve-
month period which the Town or other appropriate authority
heretofore has established or hereafter may establish as
the fiscal year for the system.
(9) "FmHA" means the United States
of America, Farmers Home Administration, Department of
Agriculture.
(10) "Income Fund" means the "Town
of Taos Joint Water and Sewer System Gross Income Fund" ,
originally created in Ord. No. 528 , which is authorized
to be continued in Section 14 hereof.
(11) "Joint Water and Sewer System" ,
"Joint System" , "joint system" , joint ut "System" ,
"system" or "Utility" means the municipally owned public
utility designated as the Town' s water system and sewer
system (constituting a joint system) , consisting of all
properties, real, personal, mixed or otherwise, now owned
or hereafter acquired by the Town through purchase, con-
struction or otherwise, and used in connection with said
water system and sewer system of the Town and in anywise
appertaining thereto, whether situated within or without
�! the limits of the Town.
(12) "Operation and Maintenance Fund"
means the "Town of Taos Joint Water and Sewer Operation
and Maintenance Fund" which was originally created by said
Ord. No. 528, which is authorized to be continued by Sec-
tion 15 hereof.
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(13) "Paying Agent" means the office
of the Town Treasurer, Taos, New Mexico, or as to any
1976 Bonds owned or insured by the FmHA at the Finance
Office of the FmHA located at 1520 Market Street, St.
Louis, Missouri 63103 , or such other place as the FmRA
may designate in writing.
(14) "Project" means extending, en-
larging, bettering and otherwise improving the joint
system.
C. Construction. Definitions include
both singular and plural. Pronouns include both singular
and plural and cover all genders .
Section 2 . Ratification. All action heretofore
taken (not inconsistent with the provisions of this ordi-
nance) by the Board and the officers of the Town directed
toward the Project and toward the issuance of the Town' s
1976 Bonds for that purpose, including the sale thereof
to the FmHA be, and the same hereby is ratified, approved
and confirmed.
Section 3. Joint System. The water and sewer
.facilities of the Town shall continue to constitute a
single joint public utility designated as the Town of Taos
joint water and sewer system and shall hereafter be oper-
ated and maintained as such for so long as the 1976 Bonds
are outstanding.
Section 4 . Authorization of Project. The
Project shall be acquired at a total estimated cost of not
exceeding $500, 000 , excluding any such cost defrayed or to
be defrayed by any source other than proceeds from the
1976 Bonds.
Section 5 . 1976 Bonds.
A. Authorization of the 1976 Bonds. For
the purpose of defraying a part of the cost of the Project,
pursuant to Sections 14-30-1 through 14-30-11, New Mexico
Statutes Annotated, 1953 Compilation, as amended, the Town
shall issue the "Town of Taos Joint Water and Sewer Exten-
sion Revenue Bonds, Series 1976", in the aggregate princi-
pal amount of $500, 000 .
B. 1976 Bond Details. The 1976 Bonds, ex-
cept as otherwise herein provided, shall be dated as of
delivery, shall consist of 500 bonds in the denomination
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of $1, 000, numbered consecutively from 1 to 500, inclu-
sive, shall bear interest from the date of such bonds to
their respective maturities at the rate of 5% per annum
evidenced by one set of interest coupons payable to
bearer (unless registered as to payment of principal and
interest as herein provided) , such interest being payable
semiannually on May 1 and November 1 in each year, commenc-
ing November 1, 1976 , and shall mature serially in regular
numerical order on November 1, as follows:
Bond Numbers Amounts Years
(All Inclusive) Maturing Maturing
1 - 5 $ 5 , 000 1978
6 - 10 5 , 000 1979
11 - 15 5 , 000 1980
16 - 20 5 , 000 1981
21 - 25 5 , 000 1982
26 - 30 51000 1983
31 - 35 5 , 000 1984
36 - 40 5 , 000 1985
41 - 50 10, 000 1986
51 - 60 10, 000 1987
61 - 70 10, 000 1988
71 - 100 30, 000 1989
101 - 130 30 , 000 1990
131 - 160 30 , 000 1991
161 - 190 30, 000 1992
191 - 220 30, 000 1993
221 - 260 40 , 000 1994
261 - 300 40, 000 1995
301 - 340 40, 000 1996
341 - 380 40, 000 1997
381 - 420 40 , 000 1998
421 - 460 40, 000 1999
461 - 500 40, 000 2000
Bo'-h principal and interest are payable in lawful money
of the United States of America, without deduction for
exchange or collection charges at the Paying Agent. If
any 1976 Bond shall not be paid at maturity upon presen-
tation and surrender, it shall continue to bear interest
at the rate of 5% per annum until paid in full. Any reg-
istered single 1976 Bond issued as hereafter provided
shall mature in installments in the amounts and on the
dates set forth above.
C. Prior Redemption. 1976 Bonds maturing
on and after November 1, 1986 shall be subject to redemp-
tion prior to their respective maturities, in whole or in
part in inverse numerical order on November 1, 1985, or
on any interest payment date thereafter for their princi-
pal amount and accrued interest to the redemption date.
Additionally, any 1976 Bonds owned or insured by the FmHA
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are subject to redemption prior to their respective
maturities, in inverse numerical order, on any interest
payment date for the principal am�junt thereof and in-
terest accrued to the redemption date. The Town also
reserves the right, at its option, to redeem on any in-
terest payment date for the principal amount thereof and
accrued interest to the redemption date any 1976 Bonds
in inverse numerical order in the event there are pro-
ceeds from the 1976 Bonds unused and unencumbered at the
time the Project is complete'. In the case of a regis-
tered single 1976 Bond, installments of principal shall
be subject to prepayment as if evidenced by the above-
designated bonds in the denomination of $1 ,000 each.
Notice of prior redemption shall be given
by the Town Treasurer in the name of the Town by one pub-
lication, at least thirty days prior to the redemption
date in a newspaper printed in the English language of
general circulation in the Town. A copy of the notice
shall be mailed at least thirty days prior to the redemp-
tion date to the Paying Agent and any holder whose name
and address appears on the registration books. So long
as any 1976 Bond is owned or insured by the FmHA, notice
shall also be mailed to the FmHA at least thirty days
prior to the redemption date at such address as the FmHA
may designate. If on any redemption date, the FmHA owns
all outstanding 1976 Bonds and coupons, if any, it may
waive any requirement of published notice. The notice
shall identify the 1976 Bonds (or in the case of a regis-
tered single bond, the installments of principal thereof)
to be redeemed, specify the redemption date, and state
that on such date the principal amount thereof and ac-
crued interest to the redemption date will become due
and payable and thereafter interest will cease to accrue.
After such notice and presentation of the 1976 Bonds , to-
gether with any coupons maturing subsequent to the redemp-
tion date, the 1976 Bonds called for redemption will be
paid.
D. Negotiability. Each 1976 Bond shall
be negotiable and payable to bearer or, if registered, to
the registered holder. The 1976 Bonds and coupons shall
have all the qualities of negotiable paper and each hold-
er shall possess all rights enjoyed by holders of negoti-
able instruments under the Uniform Commercial Code - In-
vestment Securities.
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t
E. Registration.
(1) Any 1976 Bond ma,,, be registered
for payment only as to both principal and interest. The
Town Treasurer is appointed registrar (the "Registrar")
and shall maintain books for the registration, transfer
and conversion of 1976 Bonds. The Registrar shall regis-
ter or permit to be transferred or discharged from regis-
tration any 1976 Bond presented for such purpose subject
to such reasonable regulations as the Registrar may pre-
scribe and upon reimbursing the Town for any tax or gov-
ernmental charge payable in connection therewith.
(2) Upon presentation of any 1976
Bond to the Registrar, accompanied by all unmatured cou-
pons, the Registrar shall note such registration on the
books and on the registration panel on the back of the
1976 Bond and shall detach and cancel the unmatured cou-
pons. Any registered 1976 Bond may be transferred only
upon a duly executed assignment by the registered owner
or his legal representative in form satisfactory to the
Registrar. Such transfer shall be noted on said books
and on the 1976 Bond. The principal and interest of any
registered 1976 Bond shall be payable only to, or upon
the order of, the registered owner or his legal represen-
tative. Any registered 1976 Bond may be converted into a
coupon 1976 Bond of the same series payable to bearer upon
presentation to the Registrar accompanied by an authoriza-
tion in form satisfactory to thn Registrar. The Registrar
shall attach new coupons representing interest to become
due thereafter and shall note on the 1976 Bond that it is
payable to bearer . Upon conversion of 1976 Bonds, the
Registrar shall require the payment of all expenses incur-
red by the Town in preparing new coupons.
(3) The Town and the Registrar may
treat the bearer of any unregistered 1976 Bond or 1976
Bond registered to bearer or coupons appurtenant thereto
as the absolute owner thereof, whether or not such 1976
Bond or coupon shall be overdue. The Town and its offi-
cers may treat the person in whose name any 1976 Bond is
registered as the absolute owner, whether or not such
1976 Bond shall be overdue. All payments made as provided
in this ordinance shall be valid and effectual to dis-
charge the liability upon any 1976 Bonds to the extent of
the amount so paid.
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F
Section 6. Execution of 1976 Bonds .
A. Execution. The 1976 Bonds shall be
authenticated with the facsimile signature of the Mayor,
shall be executed and authenticated with the manual sig-
nature of the Town Treasurer, shall be attested with the
facsimile signature of the Town Clerk and shall be impress-
ed with a facsimile of the corporate seal of the Town.
The interest accruing to maturity on the 1976 Bonds (othe,
than any registered single 1976 Bond) shall be evidenced
by interest coupons thereto attached authenticated by the
facsimile signature of the Town Treasurer, which officer
by the authentication of the 1976 Bonds shall adopt as
and for his or her signature the facsimile thereof appear-
ing on the coupons. The 1976 Bonds and coupons bearing
the signatures of the officers in office at the time of
the signing thereof shall be the valid and binding obliga-
tions of the Town, notwithstanding that before the delivery
thereof and payment therefor, any or all of the persons
whose signatures appear thereon shall have ceased to fill
their respective offices. The Mayor, the Town Treasurer
and the Town Clerk, at the time of the execution of the
1976 Bonds and of a signature certificate by each of them,
each may adopt as and for his or her own facsimile signa-
ture the facsimile signature of his or her predecessor in
office in the event that such facsimile signature appears
upon any of the 1976 Bonds or coupons appertaining thereto.
B. Filing of Signatures. Prior to the
execution of any 1976 Bond, pursuant to Sections 5-9-1 to
5-9-6, inclusive, New Mexico Statutes Annotated, 1953 Com-
pilation, as amended, the Mayor, Town Clerk and Town
Treasurer shall each file with the Secretary of State of
the State of New Mexico his or her manual signature cer-
tified by him or her under oath; provided that such filing
shall not be necessary (1) for any officer where any pre-
vious such filing may have legal application to the 1976
Bonds or (2) if no 1976 Bond is signed :h a facsimile
signature nor sealed with a facsimile seal of the Town.
Section 7 . Special Obligations. All of the
1976 Bonds, together with the interest accruing thereon,
shall be payable and collectible solely out of the net in-
come to be derived from the operation of the System, the
net income of which is so pledged. The holder or holders
thereof may not look to any general or other fund for the
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payment of principal and interest on such obligations
except the designated special funds pledged therefor.
The 1976 Bonds shall not constitute an indebtedness or
a debt within the meaning of any constitutional or stat-
utory provision or limitation, and shall icot be consid-
ered general obligations of the Town.
Section 8. 1976 Bond and Coupon ,' arms. The
1976 Bonds, the coupons and registration grid shall be in
substantially the following form:
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(Form of Bond)
UNITED STATES OF AMERICA
STATE OF NEW MEXICO COUNTY OF TAOS
TOWN OF TAOS
JOINT WATER AND SEWER EXTENSION REVENUE BOND
SERIES 1976
No. $1,000
The Town of Taos (the "Town") , Taos County,
New Mexico, for value received, hereby promises to pay,
upon presentation and surrender of this bond, to the
bearer hereof, or if this bond is registered, to the
registered owner hereof, solely from the special funds
provided therefor, on November 1, , the principal
sum of
ONE THOUSAND DOLLARS
and to pay solely from said special funds interest here-
on from the date hereof at the rate of five percent (5% )
per annum, evidenced until maturity by the set of coupons
appertaining hereto, being payable semiannually on May 1
and November 1 in each year commencing November 1 , 1976 ,
upon presentation and surrender of the annexed coupons as
they severally become due, or if this bond is registered ,
to the registered owner hereof. If upon presentation at
maturity, payment of this bond is not made as herein pro-
vided, interest shall continue at the above rate until
the principal hereof is paid in full. Both principal and
interest are payable in lawful money of the United States
of America, without deduction for exchange or collection
charges, at the Office of the Town Treasurer, in Taos,
New Mexico, or as to any bond or coupon owned or insured
by the Farmers Home Administration (the "FmHA") of the
United States Department of Agriculture, at the Finance
Office of the FmHA located at 1520 Market Street, St.
Louis, Missouri 63103 , or at such other place as the
FmHA may designate in writing.
This bond is one of a series of 500 bonds (the
"1976 Bonds") of like tenor and amount, except as to num-
ber, maturity and prior redemption option , authorized for
the purpose of paying the costs of extending, enlarging ,
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bettering and otherwise improving the municipal joint
water and sewer system (the "System") .
1976 Bonds maturing on and after November 1,
1986, are subject to prior redemption in inverse numeri-
cal order at the option of the Town on November 1, 1985 ,
or on any interest payment date thereafter, at a price
equal to the principal amount thereof and accrued inter-
est thereon to the redemption date. Additionally, any
1976 Bonds then owned or insured by the FmHA are subject
to redemption prior to their respective maturities in
inverse numerical order on any interest payment date
for the principal amount thereof and accrued interest to
the redemption date. The Town also reserves the right,
Y
at its option, to redeem on any interest payment date
01 for the principal amount thereof and accrued interest to
the redemption date, any or all of the 1976 Bonds in
inverse numerical order in the event there are 1976 Bond
' proceeds unused and unencumbered at the time construction
of the project being financed by the 1976 Bonds is com-
pleted. Redemption shall be made upon not less than
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k thirty days ' prior notice in the manner and upon the con-
ditions provided in Ordinance No. 640 , adopted and ap-
p.ro7r-d on June 10 , 1976 (the "Ordinance" ) which
authorizes the issuance of the 1976 Bonds .
This bond does not constitute an indebtedness
of the Town within the meaning of any constitutional or
statutory provision or limitation, shall not be consid-
ered or held to be a general obligation of the Town, and
is payable and collectible solely from the pledged net
income derived from the operation of the System. The
holder hereof may not look to the general fund or any
other municipal fund for the payment of the principal of
and interest on this bond, except the special funds
pledged therefor.
Payment of the 1976 Bonds and the interest
thereon shall be made solely from, and as security for
such payment there are pledged, pursuant to the Ordinance,
two special funds identified as the "Town of Taos Joint
Water and Sewer Extension Revenue Bonds, Series 11: %6 In-
terest and Bond Retirement Fund" , and as the "Town of
Taos Joint Water and Sewer Extension Revenue Bonds, Series
1976 Reserve Fund" , into which the Town covenants to pay,
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respectively, from the revenues derived from the opera-
tion of the System, after provision only for all neces-
sary and reasonable expenses of the operation and
maintenance of the System, and after and subject to the
payments required for the payment of principal of and
interest on the outstanding Town of Taos Joint Water
and Sewer Refunding Revenue Bonds , Series July 1, 1963
(the "1963 Bonds" ) and the outstanding Town of Taos Joint
Water and Sewer Extension Revenue Bonds , Series May 1,
1973 (the "1973 Bonds") , including specified reserves
therefor as required by Ordinances Nos. 528 and 621 ,
adopted and approved on July 1, 1963 and May 1, 1973 , re-
spectively, sums sufficient to pay when due the principal
of and the interest on the 1976 Bonds and to create and
maintain a reasonable and specified reserve for such pur-
pose. For a description of said funds and the nature and
extent of the security afforded thereby for the payment
of the principal of and interest on the 1976 Bonds , refer-
ence is made to the Ordinance. The 1976 Bonds are equally
and ratably secured by a lien on the net revenues of the
System; and the 1976 bonds constitute an irrevocable and
first lien (but not necessarily an exclusively first lien)
upon said net revenues subject and junior to the prior and
superior liens thereon of the 1963 Bonds and 1973 Bonds.
Bonds in addition to the 1976 Bonds, subject to desig-
nated conditions , may be issued and made payable from
the net revenues of the System and having a lien thereon
inferior and junior to the lien, or having a lien there-
on on a parity with the lien, of the 1976 Bonds in ac-
cordance with the provisions of the Ordinance.
The Town covenants and agrees with the holder
of this bond and with each and every person who may be-
come the holder hereof that it will keep and perform all
of the covenants of the Ordinance, including, without
limiting the generality of the foregoing , its covenant
against the sale or mortgage of the System or any part
thereof unless provision shall be made for the payment
of the principal of and the interest on the 1976 Bonds
and its covenant that it will fix, maintain and collect
rates for services rendered by the System sufficient to
pay the annual operation and maintenance expenses and
one hundred twenty percent (120%) of both the principal
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of and interest on the 1976 Bonds and any other obliga-
tions, including, without limitation, the outstanding
1963 Bonds and the outstanding 1973 Bonds , payable an-
nually from the revenues of the System (excluding the
reserves therefor) .
This bond may be registered in the name of the
holder subject to the terms and conditions set forth in
the Ordinance and, unless so registered, this bond shall
be transferable by delivery. This bond may be register-
ed only as to both principal and interest. If this bond
is registered, it may be converted into a coupon bond
payable to bearer as provided in the Ordinance.
Subject to the provisions for registration,
this bond is subject to the conditions, and every holder
hereof by accepting the same agrees with the Town and
every subsequent holder hereof, that (a) delivery of this
bond to any transferee shall vest title in this bond and
in the interest coupons attached hereto in such trans-
feree to the same extent for all purposes as would the
delivery under like circumstances of any negotiable in-
strument payable to bearer; (b) the Town and any agent
of the Town may treat the bearer of this bond as the ab-
solute owner hereof for all purposes, and shall not be
affected by any notice to the contrary; (c) the principal
of and the interest on this bond shall be paid , and this
bond and each of the coupons appertaining hereto are
transferable, free from and without regard to any equities
between the Town and the original or any intermediate
holder hereof, or any setoffs or cross-claims; and (d)
the surrender to the Town or any agent of the Town of this
bond and of each of the coupons shall be a good discharge
to the Town for the same .
It is certified, recited and warranted that all
the requirements of law have been fully complied with by
the proper Town officers in the issuance of this bond;
and that it is issued pursuant to and in strict conformity
with the Constitution and laws of the State of New Mexico,
and particularly under the terms and provisions of Sec-
tions 14-30-1 to 14-30-11, inclusive, New Mexico Statutes
Ar.rio,:ated, 1953 Compilation, as amended, and all laws
thereunto enabling and supplemental thereto.
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IN WITNESS WHEREOF, the Town has caused this
bond to be signed and authenticated in its name by the
facsimile signature of its Mayor and to be manually sign-
ed by its Treasurer; has caused the facsimile of the cor-
porate seal of the Town to be affixed hereon and to be
attested by the facsimile signature of its Clerk; and
has caused the coupons hereto annexed to be authenticated
with the facsimile signature of its Treasurer, all as of
the date of delivery hereof which is _, 197_.
TOWN OF TA OS
By (Facsimile Signature)
Mayor
By (Manual Signature)
Town Treasurer
(FACSIMILE SEAL)
Attest:
(Facsimile Signature)
Town Clerk
(End of Form of Bond)
i
-16-
(Form of Registration Panel on Back of Bond)
PROVISION FOR REGISTRATION AND CONVERSION
a
This bond may be registered only as to both
principal and interest on the books of the Town, kept
by the Town Treasurer as Registrar. Upon presentation
hereof, the Registrar shall detach and cancel all unma-
tured coupons and shall note such registration on such
books and in the registration blank below. After regis-
tration, this bond may be transferred by the registered
owner or his legal representative only upon a duly exe-
cuted assignment in form satisfactory to the Registrar,
such transfer to be made on said books and endorsed here-
on. The principal of and interest on this bond, if regis-
tered, shall be payable only to, or upon the order of,
the registered owner or his legal representative.
This bond, if registered, may be converted into
a coupon bond, upon presentation to the Registrar, accom-
panied by an instrument duly executed by the registered
owners, or his legal representative, in form satisfactory
to the Registrar. In such case, the Registrar shall at-
tach new coupons representing the interest to become due
thereafter and shall note below that this bond is payable
to bearer. Such coupon bond may again be registered as
provided above.
Every privilege of registration, transfer, dis-
charge from registration or conversion shall be exercised
only in accordance with the authorizing ordinance and such
reasonably: rules and regulations as the Registrar may
prescribe.
The registration books shall be closed for fif-
teen days prior to any interest payment date.
`— Date of Name of Signature of
Registration Registered Owner Registrar
(End of Form of Registration Panel on Back of Bond)
-17-
I
(Form of Coupon)
Coupon
No. $
May
On November 1, , the Town of Taos , Taos
County, New Mexico, unless the bond to which this coupon
is attached, if callable, has been called for redemption
on a date which is prior to the maturity of this coupon,
upon surrender of this coupon will pay to bearer in law-
ful money of the United States of America, at the Office
of the Town Treasurer in Taos, New Mexico, or, if this
coupon is then owned or insured by the United States of
America, Farmers Home Administration (the "FmHA") , at the
FmHA' s Finance Office located at 1520 Market Street, St.
Louis, Missouri 63103 , or at such other place as the
FmHA may designate in writing, the amount herein desig-
nated solely from and secured by a pledge of special
funds, such amount being interest on its Town of Taos
Joint Water and Sewer Extension Revenue Bond, Series 1976
and bearing
Bond
No.
(Facsimile Signature)
Treasurer
(End of Form of Coupon)
-18�
1
Section 9. Use of 1976 Single Bond. Notwith-
standing the foregoing provisions hereof, an aggregate
amount of money not exceeding $500, 000 borrowed from
the FmHA may be evidenced by a non-negotiable 1976 sin-
gle Bond in the principal amount and denomination of
$500, 000 (or such lesser amounts -loaned to the Town by
the FmHA) , numbered R-1, which single Bond shall be exe-
cuted in the name of and on behalf of the Town by the
signature of its Mayor, authenticated by the Treasuer,
with the seal of the Town affixed thereto and attested
by the Town Clerk. The 1976 single Bond shall not bear
interest coupons and shall be payable in lawful money of
the United States of America, without deduction for ex-
change or collection charges, during the time the FmHA
is the registered owner or insurer of such Bond, at the
Finance Office of the FmHA located at 1520 Market Street,
St. Louis, Missouri 63103, or at such other address as
the FmHA may designate in writing and so payable during
the time as any registered assign is the registered owner
of such Bond at the address shown on the registration
book of the Town. The 1976 single Bond shall mature in
installments of principal , bear interest and be subject
to prepayments of installments of principal , substantially
as provided in Section 5 hereof. The 1976 single Bond
may be registered by any holder and may be assigned in
the manner and with the effect set forth in the provisions
for registration contained in the form thereof hereinafter
set forth and as herein further provided. Upon issuance
to the FmHA, the 1976 single Bond shall be registered in
the name of the "United States of America, Farmers Home
Administration" . Upon request of the holder of the 1976
single Bond, the Town shall issue, at the holder ' s expense
and within ninety days from the date of such request, ne-
gotiable, bearer, coupon 1976 Bonds or serial registered
1976 Bond without coupons, in the denomination of $1 , 000
each, to the extent practicable, as requested by the hold-
er, in an aggregate principal amount equal to the amount
of the unpaid principal of the outstanding 1976 single
Bond of like tenor and date, in the form prescribed by,
and subject to, the provisions of this ordinance.
Section 10 . Form of the 1976 Single Bond. The
1976 single Bond, the form of assignment therefor and the
advance and payment records to be attached thereto, shall
be in substantially the following form:
-19-
•
(Form of Single Bond)
UNITED STATES OF AMERICA
STATE OF NEW MEXICO COUNTY OF TAOS
TOWN OF TAOS
SINGLE REGISTERED JOINT WATER AND SEWER
EXTENSION REVENUE BOND
SERIES 1976
No. R-1 $500,000
The Town of Taos (the "Town") , Taos County,
New Mexico, for value received hereby promises to pay
to the registered owner hereof, solely from the special
funds provided therefor, the principal sum above stated
or such lesser sum as shall represent the aggregate ad-
vances made to the Town by the Farmers Home Administra-
tion (the "FmHA" ) of the United States Department of
Agriculture as set forth in the schedule on the reverse
side hereof, on November 1, in the years and installments
as follows:
Amounts Years
Maturing Maturing
$ 51000 1978
5 ,000 1979
5, 000 1980
5, 000 1981
5, 000 1982
5, 000 1983
t, 51000 1984
5, 000 1985
10, 000 1986
10,000 1987
10, 000 1988
30, 000 1989
30, 000 1990
30, 000 1991
30,000 1992
30, 000 1993
40, 000 1994
40, 000 1995
40, 000 1996
a 40, 000 1997
} 40, 000 1998
40, 000 1999
40, 000 2000
with interest on the unpaid principal advanced to the
Town from the date of each such advance at the rate of
5% per annum payable semiannually on May 1 and November 1 of
each year until said sum is paid, commencing on November 1,
-20-
0 •
0
1976 . If upon presentation at maturity, payment of this
bond is not made as her.An provided, interest shall con-
tinue at the above rate until the principal hereof is
paid in full. Principal and interest are payable in law-
ful money of the United States of America, without deduc-
tion for exchange or collection charges, during the
period the FmHA is the registered owner or insurer of this
1.976 single Bond, at the Finance Office of the FmHA lo-
cated at 1520 Market Street, St. Louis , Missouri 63103 ,
or at such other place as the FmHA may designate in writ-
ing and are so payable during any period the FmHA is not
the registered owner or insurer hereof at the address
shown on the registration book of the Town. The final in-
stallment of principal and interest due on this 1976 sin-
gle Bond is payable only upon the Bond ' s surrender to the
Town.
This bond is authorized for the purpose of pay-
ing the costs of extending, enlarging, bettering and other-
wise improving the municipal joint water and sewer system.
Installments of principal becoming due on and
before November 1, 1985 are not payable prior to their
stated due dates unless the FmHA is the registered owner
hereof. If the FmHA is the registered owner hereof , all
installments are subject to unlimited prepayment on any
interest payment date prior to their stated due dates if
redeemed in the amount of $1, 000 or multiples thereof,
and, in inverse order of maturity, by the payment of such
principal amount and accrued interest to the prepayment
date. Installments becoming due on and after November 1 ,
1986 , are subject to prepayment prior to their stated due
dates in the amount of $1, 000 or multiples thereof , at
the option of the Town, in inverse order of maturity, on
November 1 , 1985 or on any interest payment date there-
after, by the payment of the principal amount and accrued
interest to the prepayment date. The Town also reserves
the right, at its option, to prepay installments of prin-
cipal on any interest payment date in inverse order of
maturity in the amount of $1, 000 or multiples thereof and
accrued interest to the prepayment date from excess bond
proceeds. Prepayment shall be made upon notice given as
provided in Ordinance No. 640 adopted and approved on
June 10, 1976 , authorizing the issuance of this
Bond (the "Ordinance") .
-21-
s
Payment of this 1976 single Bond and interest
thereon shall be made solely from, and as security for
such payment there are pledged, pursuant to the Ordi-
nance, two special funds identified as the "Town of Taos
Joint Water and Sewer Extension Revenue Bonds, Series
1976 Interest and Bond Retirement Fund" and the "Town of
Taos Joint Water and Sewer Extension Revenue Bonds,
Series 1976 Reserve Fund" into which the Town covenants
to pay, respectively, from the revenues of its joint
water and sewer system (the "System") , after provision
only for all necessary and reasonable operation and main-
tenance expenses and after and subject to the payments
required for the payment of principal of and interest on
the outstanding Town of Taos Joint Water and Sewer Re-
funding Revenue Bonds , Series July 1, 1963 (the "1963
Bonds" ) and the outstanding Town of Taos Joint Water and
Sewer Extension Revenue Bcads, Series May 1 , 1973 (the
"1973 Bonds") , including specified reserves therefor, as
required by Ordinances Nos . 528 and 621 , adopted and ap-
proved on July 1, 1963 and May 1 , 1973 , respectively,
sums sufficient to pay the principal and the interest on
this bond and to create and maintain a reasonable and
specified reserve for such purpose. For a description
of said funds and the nature and extent of the security
afforded thereby, reference is made to the Ordinance.
This 1976 single Bond is secured by and constitutes an
irrevocable and first lien (but not necessarily an ex-
clusively first lien) upon the net re,.•enues of the System
subject and junior to the prior and superior liens there-
on of the 1963 Bonds and 1973 Bonds. Subject to desig-
nated conditions, additional bonds may be issued payable
from said net revenues and having a lien thereon inferior
and junior to the lien, or having a lien thereon on a
parity with the lien of this 2976 single Bond in accord-
ance with the provisions of the Ordinance.
The Town covenants and agrees with the holder
hereof that it will keep and perform all the covenants of
the Ordinance, including, without limiting the generality
of the foregoing, its covenant against the sale or mort-
gage of the System or any part thereof unless provision
has been made for the payment of the principal of and in-
terest on this 1976 single Bond and its covenant that it
will fix, maintain and collect rates for services rendered
-22-
•
by the System sufficient to pay the annual operation and
maintenance expenses and one hundred twenty percent (120%)
of both the principal of and the interest on this 1976
single Bond and any other obligations, including without
limitation the outstanding 1963 Bonds and the outstanding
1973 Bonds, payable annually from the revenues of the
System (excluding the reserves therefor) .
This Bond does not constitute an indebtedness
or a debt of the Town within the meaning of any constitu-
tional or statutory provision or limitation, shall not be
considered or held to be a general obligation of the Town
and is payable and collectible solely from the pledged
net income derived from the operation of the System. The
holder hereof may not look to the general fund or any
other municipal fund for the payment of the principal of
and interest on this Bond, except the special funds
pledged therefor.
This Bond is transferable only upon books kept
by the Treasurer of the Town as bond registrar by the
registered owner hereof in person or by his duly author-
ized attorney, and similarly noted hereon, or it may be
surrendered in exchange for new bonds of the same series ,
same aggregate principal amount, in coupon form or in
serial registered form, in the denomination of $1 ,000
each, to the extent practicable and consistent with the
maturity schedule provided in, and subject to, the condi-
tions set forth in the Ordinance.
This 1976 single Bond is issued against payment
for the bond purchase price of par, but said purchase
s price may be paid to the Town in one or more advances in
accordance with the schedule on the reverse side hereof .
The principal amount of this Bond shall not exceed the
actual advances paid to the Town and interest shall ac-
crue on the amount of each advance only from the date
each advance is paid. In the event the entire principal
amount of this 1976 single Bond is not advanced , the
principal installments set forth above shall be reduced
in inverse order of maturity accordingly.
It is certified, recited and warranted that all
the requirements of law have been fully complied with by
the proper Town officers in the issuance of this Bond;
and that it is issued pursuant to and in strict conformity
-23-
i
with the Constitution and laws of the State of New
Mexico and particularly under the terms and provisions
of Sections 14-30-1 to 14-30-11, inclusive, New Mexico
Statutes Annotated, 1953 Compilation, as amended, and
all laws thereunto enabling and supplemental thereto.
IN WITNESS WHEREOF, the Town has caused this
Bond to be signed and executed in its name by the Mayor
of the Town, to be signed by the Town Treasurer, has
caused the seal of the Town to be affixed hereto, and
to be attested by the Town Clerk, all as of the date of
the delivery hereof which is August _U, 197,6•
TOWN OF TAOS
t
By (Manual Signature)
Mayor
By (Manual Signature)
Town Treasurer
(SEAL)
Attest:
(Manual Signature)
Town Clerk
(End of Form of Single Bond)
i
-24-
(Form of Installment Loan Panel on Back of Single Bond)
INSTALLMENT LOAN ADVANCES BY GOVERNMENT
The FmHA on behalf of the United States of
America loaned to the Town the respective amounts of
principal on the respective dates hereinafter designated,
the sum of which amounts constitutes the aggregate princi-
pal amount of the within 1976 single Bond, as follows :
Date of Amount of Signature of
Loan Loan Town ' s Treasurer
Aug. 20 , 76 $500 , 000 . 00 S/Jose Nine Gonzlaes
(End of Form of Installment Loan Panel)
(Form of Registration Panel on Back of Single Bond)
MANDATORY REGISTRATION FOR PAYMENT AS TO
PRINCIPAL AND INTEREST
The within 1976 single Bond is registered in
the Office of the Treasurer of the Town of Taos, Taos
County, New Mexico, as Registrar, in the name of the last
owner listed below; and the principal amount of the Bond
and interest thereon shall be payable only to such owner ,
all in accordance with the ordinance authorizing the
Bond 's issuance.
Date of Address of Signature of
Registration Name of Owner Owner Registrar
United States of Finance Office
America, Farmers 1520 Market St.
Home Administra— St. Louis, MO
Aug. 20 , 76 tion 63103 S/Jose Nine G nzales
(End of Form of Registration Panel)
-25-
(Form of Assignment Panel on Back of Single Bond)
ASSIGNMENT PROVISION
For Value Received,
hereby assign and transfer unto
the within bond, together with accrued interest thereon,
hereby irrevocably constituting and appointing
attorney to transfer this
bond on the books of the Town of Taos at the Office of
the Treasurer of the Town with full power of substitution
in the premises.
Dated:
(End of Form of Assignment Panel)
-26-
e •
e •
Section 11. Period of Project' s Usefulness.
The period of usefulness of the facilities to be ac-
quired with the proceeds of the 1976 Bonds is not less
than twenty•-five years from the date of the 1976 Bonds.
Section 12. Disposition of 1976 Bond Proceeds.
A. 1976 Construction Fund. The proceeds
derived from the sale of 1976 Bonds shall be deposited
promptly upon the receipt thereof in a "supervised bank
account" in an Insured Bank selected by the FmHA, which
account shall be known as the "Town of Taos Joint Water
and Sewcr Extension Revenue Bonds, Series 1976 Construc-
tion Fund" (the "1976 Construction Fund") . Amounts in
the account exceeding the applicable federal deposit in-
surance coverage shall be secured by such bank in advance
in accordance with U.S. Treasury rules and regulations
governing the deposit of government moneys. Moneys in
the account shall be used solely for the Project and
shall be withdrawn and signed by the Mayor and the Treas-
urer, and countersigned by the County Supervisor or other
FmHA official. Warrants or checks payable to the con-
tractor shall not be issued until the Board has received
approval of the Consulting Engineer that such sum is due
and owing. The Town' s share of any liquidated damages
and other moneys paid by defaulting contractors or their
sureties shall be deposited in the 1976 Construction Fund
to insure completion of the Project. After the Consult-
ing Engineer has certified that work is completed and
that all expenses have been paid, the bank shall transfer
all remaining money to the 1976 Bond Fund to be used to
the extent possible for redeeming 1976 Bonds or install-
ments of principal in accordance with this Ordinance.
B. Purchasers Not Responsible. The pur-
chasers of the 1976 Bonds shall not be responsible for
the application or disposal of the funds derived from the
sale of the 1976 Bonds.
Section 13 . Fiscal Year. For the purposes of
this Ordinance, the System shall be operated upon a fis-
cal year which the Board or other appropriate authority
heretofore has established or hereafter may establish as
the fiscal year for the System.
Section 14 . Income Fund. So long as any of
the 1976 Bonds shall be outstanding, either as to principal
-27-
or interest, or both, the entire gross income and reve-
nues of the System shall continue to be deposited into
the "Town of Taos Joint Water and Sewer System Gross In-
come Fund" , created by Section 14 of Ordinance No. 528
(the "Income Furd") .
Section 15. Administration of Income Fund.
So long as any of the 1976 Bonds shall be outstanding,
either as to principal or interest, or both, the follow-
ing payments shall be made from the Income Fund:
A. Operation and Maintenance Expenses.
Firstly, as a first charge thereon, there shall continue
to be set aside from time to time as the "Town of Taos
Joint Water and Sewer Operation and Maintenance Fund"
established by Section 15A of Ordinance No. 528 (the
"Operation and Maintenance Fund" ) , moneys in the Income
Fund sufficient to pay operation and maintenance ex-
penses as they become due and payable, and thereupon
they shall be promptly paid. Any surplus remaininq at
the end of the fiscal year and not needed for operation
and maintenance purposes shall be transferred to the In-
come Fund and be used for the purpose thereof , as herein
provided.
B. Bond and Reserve Funds for 1963 Bonds.
Secondly, and subject to the aforesaid provisions , from
any moneys remaining in the Income Fund, i.e . , from the
net income of the System, there shall continue to be
credited to the Bond and Reserve Funds for the 1963
Bonds the monthly payments required by paragraphs B and
C of Section 15 of Ord. No. 528 (relating to the Bond
and Reserve Funds for the 1963 Bonds) as qualified and
supplemented by the remainder of said Section 15 .
C. Bczd and Reserve Funds for 1973 Bonds.
Thirdly, and subject to the aforesaid provisions , from
any moneys remaining in the Income Fund, i.e. , from the
net income of the System, there shall continue to be
credited to the Bond and Reserve Funds for the 1973
Bonds the monthly payments required by paragraph C of
Section 16 of Ord. No. 621 (relating to the Bond and
Reserve Funds for the 1973 Bonds) as qualified and supple-
mented by the remainder of said Section 16 .
-28-
li
I
D. Bond and Reserve Funds for 1976 Bonds.
(1) 1976 Bond Fund. Fourthly, but
subje-:t and junior to the foregoing monthly payments,
there shall be credited to an account hereby created and
to be known a- the "Town of Taos Joint Water and Sewer
Extension Revenue Bonds, Series 1976 , Interest and Bond
Retirement Fund" (herein sometimes referred to as the
"1976 Bond Fund" or as the "Bond Fund") , the following:
(a) Monthly, commencing on the
first day of the month immediately succeeding the deliv-
ery of any of the 1976. Bonds an amount in equal monthly
installments necessary, together with any moneys therein
and available therefor, to pay the first maturing install-
ment of interest on the 1976 Bonds then outstanding, and
monthly thereafter commencing on said interest payment
date one-sixth of the amount necessary to pay the next
maturing installment of interest on the outstanding 1976
Bonds.
(b) Monthly, commencing on the
first day of November, 1977, an amount in equal monthly
installments necessary, together with any moneys therein
and available therefor, to pay the first maturing install-
ment of principal of the outstanding 1976 Bonds , and
monthly thereafter commencing on said principal payment
date one-twelfth of the amount necessary to pay the next
maturing installment of principal on the 1976 Bonds.
(2) 1976 Reserve Fund. Fifthly, con-
currently with the monthly payments heretofore required
by this paragraph D and subject and junior to the monthly
payments required to be paid by paragraphs A, B and C of
this section, and except as provided in paragraphs E and
F of this section, from any moneys remaining in the Income
Fund there shall be set aside and credited monthly at
least $333. 33 per month into a fund hereby created and to
be known as the "Town of Taos Joint Water and Sewer Exten-
sion Bonds, Series 1976 Reserve Fund" (herein sometimes
designated as the "1976 Reserve Fund" or "Reserve Fund")
u A a reserve has been accumulated in an amount. equal to
nw _ less than $40 , 000 (herein sometimes designated as the
"Minimum 1976 Reserve" or "Minimum Reserve") . Such payments
shall commence on the first day of the month succeeding the
delivery of any of the 1976 Bonds . After accumulation of
-29-
the Minimum Reserve, there shall be deposited monthly
from any moneys remaining in the Income Fund, into the
1976 Reserve Fund such amount or amounts as are neces-
sary to maintain the 1976 Reserve Fund as a continuing
reserve in an amount not less than the then Minimum
1976 Reserve to meet possible deficiencies in the 1976
Bond Fund. No payment need be made into the 1976 Reserve
Fund so long as the moneys therein shall equal less
than the Minimum Reserve. The moneys in the 1976 Reserve
Fund shall be accumulated and maintained as a continuing
reserve to be used, except as hereinafter provided in
paragraphs E and F of this section, only to prevent de-
ficiencies in the payment of the principal of and inter-
est on the bonds hereby authorized resulting from the
failure to deposit into the Bond Fund sufficient funds
to pay said principal and interest as the same accrue.
E. Termination Upon Deposits to Maturity.
No payment need be made into the 1976 Bond Fund, the 1976
Reserve Fund, or both, if the amount in the 1976 Bond Fund
and the amount in the 1976 Reserve Fund total a sum at
least equal to the entire amount of the outstanding bonds
herein authorized, both as to principal and interest to
their respective maturities, and both accrued and not ac-
crued, in which case moneys in said two funds in an amount
at least equal to such principal and interest requirements
shall be used solely to pay such as the same accrue, and
any moneys in excess thereof in said two funds and any
other moneys derived from the operation of the system may
be used in any lawful manner determined by the Governing
Body.
F. Defraying Delinquencies in 1976 Bond
and Reserve Funds. If, in any month, the Town shall , for
any reason, fail to pay into the 1976 Bond Fund the full
amount above stipulated from the net income of the System,
then an amount shall be paid into said Bond Fund in such
month from the 1976 Reserve Fund equal to the difference
between that paid from said net income and the full amount
so stipulated. The money so used shall be replaced in
the Reserve Fund from the first revenues thereafter re-
ceived from the operation of the System not required to
be otherwise applied. If, in any month, the Town shall,
for any reason, fail to pay into the 1976 Reserve Fund
the full amount above stipulated from the net income of
-30-
said System, the difference between the amount paid and
the amount so stipulated shall in a like manner be paid
therein from the first revenues thereafter received from
the operation of the System not required to be otherwise
applied. The moneys in the 1976 Bond Fund and the 1976
Reserve Fund shall be used solely and only for the pur-
poses of paying the principal of and the interest on the
1976 Bonds; provided, however, that any moneys at the
time in excess of the Minimum Reserve in the 1976 Reserve
Fund may be withdrawn therefrom and used as herein pro-
vided for the redemption of bonds hereby authorized as
they become due or on any redemption date; and provided
that any moneys in the 1976 Bond Fund and the 1976 Re-
serve Fund in excess of accrued and unaccrued principal
and interest requirements to the respective maturities
of the outstanding bonds may be used as hereinabove pro-
vided in paragraph E of this section.
G. Payment for Additional Obligations .
Sixly, from any balance remaining in the Income Fund af-
ter making the payments hereinabove provided, there shall
be paid the interest on and the principal of additional
bonds or other obligations, if any, hereafter authorized
to be issued and payable from the revenues of the System,
including reasonable reserves therefor, as the same accrue;
provided, that the lien of such additional bonds and other
obligations on the net income and revenues of the System
and the pledge thereof for the payment of such additional
obligations shall be on a parity with, or subordinate to,
the lien and pledge of the bonds herein authorized, as
hereinafter provided. In the event such additional bonds
or other obligations be on a parity with the bonds herein
authorized, the payment of interest on, principal of and
reserve for such additional bonds or other obligations
shall be made concurrently with the payments required by
paragraph D of this section.
H. Use of Surplus Revenues. After making
the payments hereinabove required to be made by paragraphs
A to G, both inclusive, of this section, the remaining in-
come and revenues derived from the operation of the System,
if any, may be applied to any other purpose or purposes
authorized by the Constitution and the laws of. the State,
as the Governing Body may direct.
-31-
Section 16. General Administration of Funds.
The funds and accounts created in Sections 12 and 15
hereof shall be administered as follows:
A. Places and Times of Deposits. Each
of the above accounts and funds shall be separately main-
tained and kept separate from all other funds and accounts
as a trust fund for the purposes established and shall be
deposited in one or more bank accounts in an Insured Bank
or Banks. Each account shall be continuously secured to
the extent required by law and shall be irrevocable and
not withdrawable by anyone for any other purpose. The
1976 Construction Fund and Reserve Fund must be estab-
lished and maintained as bank accounts separate from all
others. Payments shall be made into the proper account
on the first day of the month, except when the first day
shall be a Sunday or legal holiday, in which case payment
shall be made on the next succeeding secular day. At
least five days prior to any interest payment date , moneys
sufficient to pay interest and principal then due shall be
credited at the Paying Agent.
B. 1976 Bonds Not Arbitrage Bonds . The
Town hereby covenants for the benefit of each holder of the
1976 Bonds that the Town will make no use of the proceeds
of the 1976 Bonds which will cause the 1976 Bonds to be
arbitrage bonds as defined by Section 103 (d) of the Internal
Revenue Code of 1954 , as amended, or which would result in
the loss of tax exemption from federal income taxation of the
interest on the 1976 Bonds.
C. Investment of Money. Any moneys in any
fund created hereby may be invested in any legal investment
permitted by law. The obligations purchased as an invest-
ment of moneys in such fund shall be deemed at all times to
be part of such fund, and the interest accruing thereon and
any profit realized therefrom shall be credited to the .cunt: ,
and any loss resulting from such investment shall be charged
to the fund. The Town Treasurer shall present for redemp-
tion or sale on the prevailing market any obligations pur-
chased as an investment of moneys in the fund whenever it
shall be necessary to do so in order to provide moneys to
meet any payment or transfer from such fund.
-32-
Section 17. First Lien Bonds. The 1976 Bonds
constitute an irrevocable and first lien (but not neces-
sarily an exclusively first lien) upon the gross revenues
derived from the operation of the System subject to the
payment of all necessary and reasonable operation and
maintenance expenses of the System and subject and junior
to the prior and superior liens thereon of the 1963 Bonds
and the 1973 Bonds.
Section 18 . Equality of 1976 Bonds. The 1976
Bonds shall not be entitled to any priority one over the
other in the application of the net revenues, regardless
of the time or times of their issuance.
Section 19 . Additional Bonds.
A. Earnings Test. Nothing in this ordi-
nance contained shall be construed to prevent the issuance
by the Town of additional bonds or other obligations pay-
able from the .income or revenues derived from the opera-
tion of the System and constituting a lien upon said reve-
nues on a parity with, but not prior or superior to the
lien of the 1976 Bonds, nor to prevent the issuance of
bonds cr other obligations refunding all or a part of the
1976 Bonds, provided, however, that before any such addi-
tional parity bonds or other parity obligations are au-
thorized or actually issued, including the 1976 Bonds,
and also including any parity refunding obligations (other
than those refunding subordinate bonds or other subordinate
obligations as permi-Aed in Section 20 hereof) :
(1) The Town is not, and has not been
in default as to making any payments required by Section
15 hereof during the twelve months immediately preceding
the issuance of such additional bonds or other obligations,
or if none of the 1976 Bonds have been issued and outstand-
ing for a period of at least twelve months , then for the
longest period of time any of such Bonds have been issued
and outstanding; and
(2) The net revenues derived from the
operation of the System for the fiscal year immediately
preceding the date of issuance of such additional parity
obligations shall have been sufficient to pay an amount
representing one hundred twenty percent (120%) of the com-
bined average annual principal and interest requirements
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of the outstanding revenue bonds and other obligations
of the Town payable from and constituting a lien upon the
revenues of the System and the bonds or other obligations
proposed to be issued (excluding any reserves therefor) .
As used in this section, "combined average annual princi-
pal and interest requirements" shall be the total princi-
pal and interest coming due on the then outstanding and
proposed parity lien obligations during the period extend-
ing from the date of the proposed parity lien obligations
to the final principal payment date of the then outstand-
ing 1976 Bonds divided by the number of years (including
any fraction thereof) computed from the date of the pro-
posed parity lien obligations to the last principal pay-
ment date of the then outstanding 1976 Bonds.
The foregoing limitations on the issuance
of parity bonds shall not apply in the case of the issu-
ance of additional parity bonds necessary to complete the
Project in accordance with the original plans and specifi-
cations therefor.
B. Certification or Opinion of Earnings .
A written certification or opinion by an Independent
Accountant that said revenues for the fiscal year immedi-
ately preceding the date of issuance of the new obliga-
tions are sufficient to pay said amounts when adjusted as
hereinafter provided , shall be conclusively presumed to
be accurate in determining the right of the Town to au-
thorize, issue, sell and deliver said additional bonds or
other obligations on a parity with the 1976 Bonds.
C. Consideration of Additional Expenses .
In determining whether or not additional parity bonds or
other parity obligations may be issued as aforesaid, con-
sideration shall be given to any probable increase (but
not reduction) in operation and maintenance expenses that
will result from the expenditure of funds proposed to be
derived from the issuance and sale of the said bonds or
other obligations.
D. Junior Obligations Permitted. Nothing
herein contained shall be construed to prevent the Town
from issuing bonds or other obligations payable from the
revenues of the System and having a lien thereon subordi-
nate, inferior and junior to the lien of the 1976 Bonds .
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E. Superior Obligations Prohibited.
Nothing herein contained shall be construed to permit
the Town to issue bonds or other obligations payable
from the revenues of the System and having a lien there-
on prior and superior to the lien of the 1976 Bonds .
Section 20. Refunding Bonds. The provisions
of Section 19 hereof are subject the following
exceptions :
A. Privilege of Issuing Refunding
Obligations. If at any time after the 1976 Bonds or any
part thereof shall have been issued and remain outstand-
ing, the Board shall find it desirable to refund any
outstanding bonds or other outstanding obligations pay-
able from any revenues of the System, said bonds or other
obligations, or any part thereof, may be refunded (but
only with the consent of the holder or holders thereof,
unless the bonds or other obligations, at the time of
their required surrender for payment, shall then mature,
or shall then be callable for prior redemption at the
Town ' s option) , regardless of whether the priority of the
lien for the payment of the refunding obligations on the
revenues of the System is changed (except as provided in
paragraph E of Section 19 hereof and in paragraphs B and
C of this Section 20) .
B. Limitations Upon Issuance of Parity
Refunding Obligations. No refunding bonds or other re-
funding obligations payable from any revenues of the
System shall be issued on a parity with the 1976 Bonds,
unless:
(1) The lien on any revenues of the
System of the outstanding obligations refunded is on a
parity with the lien thereon of the 1976 Bonds; or
(2) The refunding bonds or other
refunding obligations are issued in compliance with para-
graph A of Section 19 hereof.
C. Refunding Part of an Issue. The re-
funding bonds or other obligations issued shall enjoy
complete equality of lien with the portion of any bonds
or other obligations of the same issue which is not re-
funded, if any; and the holder or holders of such refund-
ing bonds or such other refunding obligations shall be
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subrogated to all of the rights and privileges enjoyed
by the holder or holders of the bonds or other obliga-
tions of the same issue refunded thereby.
D. Limitations upon Issuance of any Re-
funding Obligations. Any refunding bonds or other refund-
ing obligations payable from any revenues of the System
shall be issued with such details as the Board may by
ordinance provide, subject to the inclusion of any such
rights and privileges designated in paragraph C of this
Section 20 , but without any impairment of any contractual
obligation imposed upon the Town by any proceedings au-
thorizing the issuance of any unrefunded portion of such
outstanding obligations of any one or more issues (in-
cluding, but not necessarily limited to the 1976 Bonds) .
If only a part of the outstanding bonds and any other
outstanding obligations of any issue or issues payable
from the revenues of the System is refunded, then such
obligations may not be refunded without the consent of
the holder or holders of the unrefunded portion of such
obligations , unless :
(1) The refunding bonds or other re-
funding obligations do not increase any aggregate annual
principal and interest requirements evidenced by such re-
funding obligations and by the outstanding obligations
not refunded on and prior to the last maturity date of
such unrefunded obligations, or
(2) The lien on revenues of the
System for the payment of the refunding obligations is
subordinate to each such lien for the payment of any ob-
ligations not refunded, or
(3) The refunding bonds or other
refunding obligations are issued in compliance with para-
graph A of Section 19 hereof.
Section 21. Protective Covenants. The Town
hereby covenants and agrees with each and every holder of
the 1976 Bonds:
A. Use of Bond Proceeds. The Town will
proceed, without delay, to acquire the Project, as herein
provided.
B. Payment of 1976 Bonds. The Town will
promptly pay the principal of and the interest on every
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1976 Bond at the place, on the dates and in the manner
specified herein and in the 1976 Bonds and in the cou-
pons (if any) thereto appertaining according to the true
intent and meaning hereof.
C. Use Charges. While any of the 1976
Bon_do remain outstanding and unpaid, the rates for all
services rendered by the System shall be reasonable and
just, taking into account the cost and value of the Sys-
tem, proper and necessary allowances for the deprecia-
tion thereof and the amounts necessary for the retirement
of all bonds and other obligations payable from the
revenues of the System, the accruing interest thereon and
reserves therefor. There shall be charged against all
users of service such rates and amounts as shall be ade-
quate to meet the requirements of this and the preceding
sections hereof, and which shall be sufficient to produce
revenues annually to pay the annual operation and main-
tenance expenses, and one hundred twenty percent (120%)
of both the principal of and interest on 1976 Bonds and
any other obligations payable annually from the revenues
thereof, excluding the reserves therefor, all of which
reserves shall be subject to distribution for the payment
of the costs of operating- and maintaining the System and
the payment of principal of and interest on all obliga-
tions payable from the revenues of the System, including
reasonable reserves therefor. No free service , facili-
ties or commodities shall be furnished by the System.
All the income so derived from the Town shall be deemed
to be income derived from the operation of the System, to
be used and accounted for in the same manner as any other
income derived from the operation of the System.
D. Levy of Charges. The Town will fix ,
establish and levy the rates and charges which are re-
quired by paragraph C of this Section 21. No reduction
in any initial or existing rate schedule for the System
may be made unless :
(1) The Town has fully complied with
the provisions of Sections 14 and 15 hereof for at least
the full fiscal year immediately preceding such reduction;
and
(2) The audit required by the In-
dependent Accountant by paragraph H of this section for
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the full fiscal year immediately preceding such reduction
discloses that the estimated revenues resulting from the
proposed rate schedule will be sufficient to meet the re-
quirements of paragraph C of this section; and
(3) If any of the bonds are then
owned by the FmHA, the State Director of the FmHA ap-
proves in writing the proposed reduction provided that
he shall have first been furnished with a written request
signed by the Mayor of the Town requesting and justifying
such reduction; provided further, however, that no such
approval shall be required if the refusal of the State
Director of the FmHA to give such approval would violate
the Town' s covenants under Ordinances Nos . 528 or 621.
E. Efficient Operation. The Town will
operate the System so long as any of the 1976 Bonds are
outstanding, will maintain the System in efficient operat-
ing condition and will make such improvements , extensions ,
enlargements, repairs and betterments thereto as may be
necessary or advisable to insure its economical and ef-
ficient operation.
F. Records. Separate records will be kept
showing complete and correct entries of all transactions
relating to the System. Such records shall include month-
ly entries showing:
(1) The number of customers ;
(2) The revenues received from
charges to customers.
(3) A detailed statement of expenses;
and
(4) Such other items specified by any
form furnished by the FmHA.
Before teach fiscal year, the Board will
cause an operating budget to be prepared.
G. Right to Inspect. The FmHA, any holder
or their duly authorized agents shall have the right at
all reasonable times to inspect the System and all records,
accounts and data relating thereto.
H. Audits. Within twenty days following
the close of each fiscal year, the Town will furnish an
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audit of such books and accounts made by an Independent
Accountant showing the receipts and disbursements for
the account of the System to the FmHA. Each such audit,
in addition to whatever matters may be thought proper by
the accountant, shall include:
(1) A balance sheet as of the end
of such fiscal year, including all funds created by the
various proceedings authorizing the issuance of outstand-
ing obligations payable from the revenues of the System.
(2) A statement for the fiscal year
just closed of the income and expenditures of the System,
including gross revenues, net revenues, the amount of
any capital expenditures and profit or loss.
(3) The accountant' s comment regard-
ing the manner in which the Town has carried out the re-
quirements of this ordinance and any other proceedings
authorizing the issuance of outstanding obligations pay-
able from the revenues of the System and the accountant ' s
recommendation for any change or improvement in the opera-
tion of the System.
(4) A list of the insurance policies
in force setting out as to each policy the amount of the
policy, the risks covered, the name of the insurer and
the expiration date.
(5) A recapitulation of each fund or
account created by the various proceedings authorizing
the issuance of outstanding obligations payable from the
revenues of the System, showing the balance in such fund
at the beginning of the fiscal year, the deposits and
withdrawals during said year, and the balance at the end
of said year.
(6) The number of metered water con-
nections and unmetered water connections at the beginning
and at the end of the fiscal year.
(7) The number of customers per class
of customers and revenues per class of customers, includ-
ing but not necessarily limited to classification by
water facilities and sewer facilities , and the total
water consumption in detail, including but not limited to
domestic consumption, water used for fires and flushing
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mains, and water consumed or lost and unaccounted for,
and total sewage treatment by classes of customers.
Along with the audit, the Town will fur-
nish the following:
(1) An operating budget showing the
planned budget for the ensuing year.
(2) A copy of the minutes of the
meeting of the Board at which such budget was approved.
(3) A written instrument containing
the name, address and term of office for the Mayor, Town
Clerk and each member of the Board and the number of resi-
dential users and the number of commercial users of the
System.
(4) Quarterly reports of income and
expenses on forms furnished by the FmHA.
(5) A financial statement on a form
furnished by the FmHA.
The Town will furnish a copy of each audit,
budget, minutes, written instrument, quarterly report and
financial statement to any holder at his request and with-
out request to the FmHA. Any holder shall have the right
to discuss the contents with any person making the audit .
The Town shall publish a summary of each annual audit at
least once within three months after expiration of the
fiscal year in a newspaper published in the English lan-
guage and of general circulation in the Town.
All expenses incurred in preparing the au-
dits and other documents by this section shall be consid-
ered and paid as an operation and maintenance expense.
I . Billing Procedures. All bills for
water and water service or facilities and sewer service
or facilities furnished or served by or through the Sys-
tem shall be sent to customers on a regularly established
day of each and every month either monthly in advance or
in the month next succeeding the month in which the ser-
vice was rendered and shall be due within twenty days from
the date sent. In the event the bills are not paid within
forty days after the date when sent, water and water ser-
vice shall be discontinued, and the rates and charges due
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shall be collected in a lawful manner, including but not
limited to the cost of disconnection and reconnection.
Water charges and sewer charges may be billed jointly
with each other or separately, and each such joint bill
shall show separately water and sewer charges.
J. use of 1976 Bond Fund and 1976 Reserve
Fund. The 1976 Bond Fund and the 1976 Reserve Fund shall
be used solely and only, and said funds are hereby pledged
for the purposes set forth in this ordinance .
K. Charges and Liens upon System. From
the revenues of the System the Town will pay all taxes
and assessments or other municipal or governmental charges
lawfully levied, assessed upon or in respect to the System,
or any part thereof, when due. It will duly observe and
comply with all valid requirements of any municipal or
governmental authority relative to any part of the System.
The Town will not create or suffer to be created any lien
or charge upon the System or upon the revenues therefrom
except as permitted by this ordinance, or it will make
adequate provision to satisfy and discharge within sixty
days after the same shall accrue, all lawful claims and
demands for labor, materials, s:ipplies or other objects ,
which, if unpaid, might become a lien upon the System or
upon the revenues therefrom; provAed, however, that
nothing herein shall require the Town to pay or cause to
be discharged any such tax, assessment, lien or charge be-
fore the payment shall be due or so long as the validity
thereof shall be contested in good faith by appropriate
legal proceedings.
L. Insurance. The Town will carry fire
and extended coverage insurance on all above ground
structures in an amount at least equal to the depreciable
replacement value of such structures. The proceeds of
such insurance shall be used to restore the property lost
or damaged and any remainder shall be distributed as net
income. The Town will also maintain as provided by law a
self-insurance fund to cover workmen' s compensation in-
surance and public liability insurance in such amounts
and to such extent as is normally carried by private cor-
porations operating public utilities of the same type.
M. Competing System. The Town shall not
grant any franchise or license to a competing system, or
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permit any person, association, firm or corporation to
sell water, water service or facilities, or sewer service
or facilities, within the Town.
N. Alienating System. The Town will not
sell, lease, mortgage, pledge, alienate or otherwise en-
cumber, the System or any part thereof, until the 1976
Bonds shall have been paid in full, both principal and
interest, or unless provision has been made therefor , ex-
cept any portion which shall have been replaced by other
property of at least equa value, or which shall cease to
be necessary for the efficient operation of the System.
The proceeds of any such sale shall be distributed as net
income .
O. Extended Interest Payments. The Town
will not extend or assent to the extension of the time
for the payment of any coupon or claim for interest on
any of the 1976 Bonds. In case the time for payment of
any such coupons or claims shall be extended, such coupon
or installment or installments of interest shall not be
entitled in case of default hereunder to the benefit or
security of this ordinance except subject to the prior
payment in full of the principal of all the 1976 Bonds,
and of matured interest on the 1976 Bonds the payment of
which has not been extended.
P. Surety Bonds. The Town Treasurer shall
be bonded in the amount of at least $10, 000 . FmHA Form
440-24 shall be used for such purpose and such bond shall
name the United States of America as co-obligee.
Q. Town' s Existence. The Town will main-
tain its corporate identity and existence so long as any
of the 1976 Bonds remain outstanding, unless another po-
litical subdivision by operation of law succeeds to the
liabilities and rights of the Town, without adversely af-
fecting to any substantial degree the privileges and
rights of any Bondholder.
R. Performing Duties. The Town will faith-
fully and punctually perform all duties with respect to
the System required by the Constitution and laws of the
State of New Mexico and the ordinances and resolutions of
the Town, including but not limited to making and collect-
ing reasonable and sufficient rates and charges for
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services rendered or furnished by the System and proper
segregation of the revenues of the System and their ap-
plication in the manner provided in this ordinance.
S. Other Liens. Other than as set forth
in this ordinance, there are no liens or encumbrances of
any nature whatsoever, on or against the System or the
revenues derived or to be derived from the operation of
the same.
Section 22, Events of Default. It is an "event
of default" if:
A. Nonpayment of Principal. Payment of
the principal of any 1976 Bond is not made when due at ma-
turity or ��pon prior redemption.
B. Nonpayment of Interest. Payment of in-
terest Is not made when due.
C. Incapable to Perform. The Town is not
capable of fulfilling its obligations hereunder .
D. Default of any Provision. The Town de-
faults in the punctual performance of its covenants here-
under for sixty days after written notice shall have been
given by the holders of at least twenty-five percent (25%)
in principal amount of the outstanding 1976 Bonds.
Section 23 . Remedies of Default. Upon the oc-
currence and continuance of any event of default, the
holder or holders of not less than twenty-five per cent
(25%) in principal amount of the outstanding 1976 Bonds
or a trustee therefor may protect and enforce the rights
of any Bondholder by proper legal or equitable performance
of any covenant, the appointment of a receiver (the con-
sent to such appointment being hereby granted) , injunctive
relief, or requiring the Board to act as if it were the
trustee of an express trust, or any combination of such
remedies . All proceedings shall be maintained for the
equal benefit of all holders. Any receiver appointed to
protect the rights of Bondholders may take possession
and operate and maintain the System in the same manner as
the Town itself might do. The failure of any holder to
proceed does not relieve the Town or any person of any
liability for failure to perform any duty hereunder. The
foregoing rights are in addition to any other right and
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the exercise of any right by any Bondholder shall not be
deemed a waiver of any other right.
Section 24. Duties upon Default. Upon the
happening of any event of default, the Town will perform
all proper acts to protect and preserve the security
created for the prompt payment of the principal of and
interest on the 1976 Bonds. In the event the Town fails
or refuses to proceed as in this section provided, the
holder or holders of not less than twenty-five percent
(25%) in principal amount of the outstanding 1976 Bonds ,
after written demand, may proceed to protect and enforce
the rights provided in this section. All proceeds de-
rived therefrom shall be distributed as net income.
Section 25. Prior Charge upon Lower Rates.
If any body, commission or authority lawfully prescribes
a lower schedule of rates than that contemplated by this
ordinance, then the payment of principal and interest on
the 1976 Bonds and parity bonds shall constitute a =irst
and prior charge on net revenues.
Section 26 . Defeasance. When the 1976 Bonds
have been paid, the pledge and lien and all obligations
hereunder shall be discharged and the 1976 Bonds shall
no longer be deemed to be outstanding. Payment shall be
deemed made when the Board has placed in escrow with a
commercial bank exercising trust powers, an amount suf-
ficient (including the known minimum yield from Federal
Securities) to meet all requirements of principal, inter-
est and prior redemption premium, if any, as the same be-
come due to their final maturities or upon designated
prior redemption dates. Any Federal Securities shall be-
come due when needed in accordance with a schedule agreed
upon between the Board and such bank: at the time of the
creation of the escrow or shall be subject to redemption
at the option of the holder thereof to assure the avail-
ability thereof when needed to meet such schedule. Fed-
eral Securities within the meaning of this section shall
include only direct obligations of, or obligations which
are unconditionally guaranteed by, the United States of
America.
Section 27. Delegated Powers . The officers of
the Town be, and they hereby are authorized and directed
to take all action necessary or appropriate to effectuate
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the provisions of this ordinance, including the printing
of the 1976 Bonds (including the opinion of counsel if
so agreed to) , the preparation of and execution by the
Town officials of any certificates reasonably required
by the FmHA and the execution and delivery of the 1976
Bonds.
r
Section 28. Amendment of Ordinance. This or-
dinance may be amended, without receipt by the Town of
any additional consideration, but with the written con-
sent of the holders of seventy-five percent (75%) in
principal amount of the 1976 Bonds the}i outstanding; but
no ordinance adopted without the written consent of the
holders of all outstanding 1976 Bonds shall have the
effect of permitting:
A. An extension of the maturity of any
1976 Bond; or
B. A reduction in the principal amount
or interest rate of any 1976 Bond; or
C. The creation of a lien upon revenues
A ranking prior to the lien or pledge created by this or-
dinance; or
D. A reduction of the principal amount of
1976 Bonds required for consent to such amendatory ordi-
nance; or
E. The establishment of priorities as be-
tween 1976 Bonds issued and outstanding under the provi-
sions of this ordinance; or
F. The modification of or otherwise af-
fecting the rights of the holders of less than all of the
outstanding 1976 Bonds.
The provisions of this section shall not apply
to any amendment of this ordinance which will not adverse-
ly affect the 1976 Bonds it such amendment is effective
prior to the issuance of any of the 1976 Bonds.
Section 29 . Ordinance Irrepealable . After any
of the 1976 Bonds are issued, this ordinance shall be and
remain irrepealable until the 1976 Bonds and the interest
thereon shall be fully paid, canceled and discharged, as
herein provided.
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a
Section 30. Severability Clause. If any sec-
tion, paragraph, clause or provision of this ordinance
shall for any reason be held to be invalid or unenforce-
able, the invalidity or unenforceability of such section,
paragraph, clause or provision shall not affect any of
the remaining provisions of this ordinance.
Section 31. Repealer Clause. All bylaws,
orders, resolutions and ordinances, or parts thereof, ex-
cept Ordinances Nos. 528 and 621, inconsistent herewith
are hereby repealed to the extent only of such inconsist-
ency. This repealer shall not be construed to revive any
bylaw, order, resolution or ordinance, or part thereof,
heretofore repealed.
Section 32 . Emergency Clause and Effective
Date. This ordinance is necessary for the preservation of
the public health, peace and safety of the inhabitants of
the Town and because the Town is in great need of the
Project, this ordinance is hereby declared to be an emer-
gency measure on the ground of urgent public need. Imme-
diately upon the adoption of this ordinance by at least
three-fourths of all of the fully authorized members of
the entire Board and upon its final passage, the ordinance
shall be recorded in the book of ordinances of the Town
kept for that purpose, authenticated by the signatures of
the Mayor and Town Clerk, and the title and general sum-
mary of the subject matter contained in this ordinance
(set out in Section 33 below) shall be published in the
Taos News, a newspaper which maintains an office in and is
of general circulation in the Town, in accordance with law,
and this ordinance shall be in full force and effect five
days after such publication.
Section 33. General Summary for Publication.
Pursuant to Section 14-16-4 , New Mexico Statutes Annotated,
1953 Compilation, as amended, the title of , and a general
summary of the subject matter contained in this ordinance
shall be published in substantially the following form:
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i
(Form of Summary of Ordinance for Publication)
TOWN OF TAOS
NOTICE OF ADOPTION OF ORDINANCE NO. 640
NOTICE IS HEREBY GIVEN of the title and of a
general summary of the subject matter contained in Ordi-
nance No. 640 duly adopted and approved by the Board
of Trustees of the Town of Taos , New Mexico, on June loth
1976. A complete copy of Ordinance No. 640 is avail-
able for public inspection during the normal and regular
business hours of the Town Clerk in the office of the
Taos Clerk, Town Hall (i.e. , Municipal Offices) on Armory
Street in the Town of Taos , New Mexico.
The title of Ordinance No. 640 is:
AN ORDINANCE PROVIDING FOR THE EXTENSION, EN-
LARGEMENT, BETTERMENT AND OTHER IMPROVEMENT OF
THE MUNICIPAL JOINT WATER AND SEWER SYSTEM OF
THE TOWN OF TAOS, NEW MEXICO; DECLARING THE
NECESSITY FOR MAKING AND ISSUING THE TOWN 'S
JOINT WATER AND SEWER EXTENSION REVENUE BONDS,
PAYABLE SOLELY OUT OF THE NET INCOME TO BE
DERIVED FROM THE OPERATION OF SUCH JOINT SYS-
TEM; AUTHORIZING THE ISSUANCE AND SALE OF SUCH
REVENUE BONDS IN THE AGGREGATE PRINCIPAL AMOUNT
OF $500 , 000; PROVIDING FOR THE DISPOSITION OF
THE INCOME TO BE DERIVED FROM THE OPERATION OF
SAID JOINT SYSTEM; ADOPTING BY REFERENCE CER-
TAIN PROVISIONS OF ORDINANCE NO. 528 , ADOPTED
AND APPROVED ON JULY 1 , 1963 ; PRESCRIBING OTHER
DETAILS CONCERNING SAID REVENUE BONDS, INCLUD-
ING BUT NOT LIMITED TO COVENANTS AND AGREEMENTS
IN CONNECTION THEREWITH; RATIFYING ACTION PRE-
VIOUSLY TAKEN CONCERNING SAID JOINT SYSTEM AND
SAID BONDS; REPEALING ALL ORDINANCES IN CON-
FLICT HEREWITH; AND DECLARING AN EMERGENCY.
The following is a general summary of the sub-
ject matter contained- in Ordinance No. 640
Preambles recite such matters as : Town ' s exist-
ence and ownership of the municipal water and sewar system
(the "System" ) . its only present outstanding oU igations
payable from revenues of the System being the issue of
Joint Water and Sewer Refunding Revenue Bonds , Series
July 1, 1963 ("1963 Bonds" ) and the issue of Joint Water
and Sewer Extension Revenue Bonds, Series July 1 , 1973
("1973 Bonds" ) , the need to extend, enlarge, better and
otherwise improve the System, the ordinances authorizing
the 1963 Bonds and the 1973 Bonds providing for the issu-
ance of bonds having a lien on the System on a parity
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with the lien of the 1963 Bonds or the 1973 Bonds upon
compliance with certain conditions, but that such limi-
tations may not be met, the sufficiency of anticipated
revenues to pay outstanding and the proposed bonds, the
receipt of a commitment from the United States of America,
Farmers Home Administration ("FmHA") for the purchase of
the Town' s Joint Water and Sewer Extension Revenue Bonds,
Series 1976 ("1976 Bonds") to be authorized for par and
an interest rate of 5% per annum; and the determination
of the Board of Trustees of the Town to authorize the
issuance of the 1976 Bonds and of the Town ' s Joint Water
and Sewer Extension Revenue Bonds, Series 1976 ( "1976
Bonds") .
Sections 1 through 4 define terms (incorporat-
ing by reference some of the provisions of Ordinance No .
528) , ratify action by officers of the Town in connection
with the Projec-`. (i.e. , extending, enlarging, bettering
and otherwise improving the System) and the 1976 Bonds,
establish that the water and sewer facilities shall con-
tinue to be a single joint system and authorize the ac-
quisition of the Project.
Section 5 authorizes the 1976 Bonds and gives
details thereof, including but not limited to : the issu-
ance in the aggregate principal amount of $500, 000 , dating
the 1976 Bonds as of the date of delivery, specifying 500
bonds in the denomination of $1, 000 each, providing that
the 1976 Bonds shall bear one set of interest coupons, un-
less registered, such interest being payable May 1 and No-
vember 1 of each year, commencing November 1 , 1976 , and
bearing interest at a rate of 5% per annum, providing for
the place and manner of payment of principal of and inter-
est on the 1976 Bonds, providing that the 1976 Bonds mature
serially or in installments in varying amounts on November 1
in the years 1978 to 2000, providing for prior redemption
under certain conditions, and for negotiability and registra-
tion as to payment.
Sections 6 through 10 provide for the form and
method of execution of the 1976 Bonds and coupons and regis-
tration panel, that the 1976 Bonds are special obligations
payable from the net revenues of the System, provide the
form of the 1976 coupon Bonds, coupons and registration
grid, and the form and use of a single bond in the aggre-
gate principal amount of $500,000 without coupons.
-48-
EAt
RM
t'
Sections 11 through 18 determine the period of
usefulness of the Project, provide for the disposition
of the proceeds of the 1976 Bonds into a construction
fund, that the purchasers are not responsible for appli-
cation of the bond proceeds, establish the fiscal year
for the System, provide for continued deposit into the
Income Fund previously established and provide for the
Bond Fund and Reserve Fund for the 1976 Bonds and other
details concerning said funds and net revenues of the
System, for the administration of all funds and accounts
created or continued by the ordinance, for the investment
of moneys in the funds, the places and times of deposit
of money in the funds, that the 1976 Bonds shall not be
i
arbitrage bonds, that the 1976 Bonds constitute a first
(but not an exclusively first) lien on the net revenues
of the System, subject and junior to the prior and supe-
rior lien for the 1963 Bonds and 1973 Bonds, and for
equality among the 1976 Bonds in the application of the
net revenues .
Sections 19 through 21 set forth the terms and
conditions under which parity lien bonds may be issued,
permit the issuance of bonds having a subordinate lien,
prohibit the issuance of bonds having a superior lien,
set out the terms and conditions relative to refunding
bonds and provide for protective covenants whereby the
Town covenants with each bondholder for the protection
of each bondholder covering such matters as: use of bond
proceeds; payment of the 1976 Bonds; charges for the use
of the System; levy of charges; efficient operation of
the System; records; right to inspect the System; audits
and budgets concerning the System, billing procedures and
discontinuance of service; use of 1976 Bond Fund and Re-
serve Fund; charges and liens upon the System; :insurance;
prohibition against competing system; alienating System;
extending interest payments; sarety bonds , faithful per-
formance of duties by Town; other liens; and Town' s
existence.
Sections 22 through 33 concern events of default
and remedies for and duties upon default, provide for
prior charges upon lower rates, defeasance, delegate cer-
tain powers to Town officials, provide a procedure for
amendment of the ordinance, state the ordinance is irre-
pealable, provide for severability and repealer clauses,
-49-
declare an emergency and provide for the effective date
of the ordinance and a form for publication.
There is also a statement by the Mayor that.
this ordinance is an emergency.
i
WITNESS my hand and the seal of the Town of
Taos, New Mexico, this 10th day of June, 1976.
4
/s/ Josephine Gonzales
Town Clerk
(SEAL)
r
(End of Form of Summary of ordinance for Publication)
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-50-
:a
PASSED, ADOPTED, SIGNED AND APPROVED this
10tb day of June, 1976.
Ma or
(SEAL)
i
Attest:
Town Glerk
I, the Mayor of the Town of Taos, New Mexico,
do hereby declare that an emergency exists with respect
to the foregoing ordinance because of the urgent need
for the Project which is for the public health, safety
and welfare of the Town and that any publication of such
ordinance prior to its adoption hereby is declared to be
unnecessary.
WITNESS my hand this loth day of June, 1976 .
V LL
ayor
-51-
Thereupon, the Mayor, pursuant to Section
14-16-2.1, NMSA 1953 declared that such ordinance is
an emergency, such declaration being set forth in the
statement attached to the ordinance.
It was then moved by Trustee Fernando Valdez
and seconded by Trustee Lawrence Santistevibbat any and all
rules of the Board of Trustees which *might prevent, un-
less suspended, the final passage and adoption of this
ordinance at this meeting be, and the same hereby are j
suspended for the purpose of permitting the final pas-
sage and adoption of this ordinance at this meeting.
The question being upon the adoption of said
motion and the suspension of the rules, the roll was
called with the following result:
Those Voting Aye :. Lawrence Santistevan
Fernando Valdez
Joe A Sanchez
i
Those Voting Nay: None
Those Absent: FI=liplAantete
Three members of the Board of Trustees
having voted in favor of said motion, the presiding of-
ficer declared said motion carried and the rules
suspended.
Trustee Fernando Valdez then moved that said or-
dinance be passed and adopted as read. Trustee Lawrence Santisk.evan
seconded the motion. The question being upon the passage
and adoption of said ordinance, the roll was called with
the following result:
Those Voting Aye: Lawrence Santistevan
Fernando Valdez
Joe A. Sanchez
Those Voting Nay: None
Those Absent: Eloy Jeantete
The Mayor thereupon declared said motion car-
ried by the affirmative vote of at least three-fourths of
the members of the entire Board of Trustees and the said
ordinance duly passed and adopted.
-52-
Upon motion duly adopted, it was ordered that
said ordinance, after due authentication by the Mayor of
the Town of Taos and the Town Clerk, be recorded accord-
ing to law.
Thereupon, the Board of Trustees considered
other business not concerning the Town's bonds.
Thereafter, there being no further business
to come before the meeting, the same was, on motion
made, seconded and unanimously adopted, duly adjourned.
(2p,
M or
(SEAL)
est:
Towh;Clerk
-53-
STATE OF NEW MEXICO )
)
COUNTY OF TAOS ) SS.
)
TOWN OF TAOS )
I, Josephine Gonzales , Town Clerk of the Town
of Taos, New Mexico (the "Town") , do hereby certify :
1. The foregoing pages numbered from 1 to 53 ,
inclusive, constitute a full, true and correct copy of
the record of the proceedings taken by the Board of
Trustees of the Town at a lawful public regular- meeting f•�'`
thereof , held at 7:30 p.m. on June 10, 1976 , at the Town
Hall (i.e. , the Town ' s Municipal Offices) on Armory Street,
in Taos , New Mexico , insofar as said proceedings relate
to an ordinance , a copy of which is therein set forth, and
said copy of said ordinance as contained in said proceed-
ings is a full, true and correct copy of the original of
said ordinance as passed by the Board of Trustees at said
meeting.
2. Said original ordinance has been duly authen-
ticated by the signatures of the Mayor of the Town and my-
self as Town Clerk , sealed with the corporate seal of the
Town, signed and approved by th6 Mayor thereof, and recorded
in the boob of ordinances-of the Town kept for that purpose
in my office , which record has been duly signed by said
officers and sealed with the seal of the Town.
3 . Attached hereto as Exhibit A is a correct copy
of the affidavit of publication of the Notice of Meeting And
Proposed Ordinance for the meeting at which said ordinance
was adopted. Said notice was published at least two weeks
prior to the date of said meeting , in full conformity with
Sections 14-16-2.1 and 5-6-23 , New Mexico Statutes Annotated,
rri
1953 Compilation, as amended, and with a resolution adopted
by the Board of Trustees on March 24 , 1976 , which �?" -
established reasonable notice for actions by the Board of
Trustees pursuant to Section 5-6-23 , New Mexico Statutes
Annotated, 1953 Compilation, as amended.
4 . Said ordinance was on June 17 , 1976 ,
published by title and summary in the Taos News , being the
official newspaper and newspaper which maintains an
office in and is of general circulation within the Town,
a copy of the affidavit of publication therefor being at-
cached as Exhibit B.
-54-
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5. The Mayor and three other members of the
Board of Trustees were present at said meeting, and the
members of the Board of Trustees voted on the passage of
said ordinance as in said minutes set forth.
6. All members of the Board of Trustees were
1
given due notice of said meeting.
IN WITNESS WHEREOF, I have hereunto set-my ,
hand and the seal of the Town this day of
1976.
.
Town Clerk
(SEAL) t
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s
f
EXHIBIT A
(Attach Affidavit of Publication
of Notice of Meeting)
-!AL ADVERTISEMENT LEGAL ADVERTISEMENT
TOWN OFTAOS, the administration of all funds and ac• Affidavit of Publication
NEWMEXICO counts created or continued by the or.
NOTICEOFMEETING dinance,for the Investment of moneys in
AND PROPOSED ORDINANCE the funds,the places and times of deposit 11CO3
The Board of Trustees of the Town of of money in the funds,that the 1976 Bonds
Taos therein the"Town"), New Mexico, shall not be arbitrage bonds,that the 191
hereby gives notice of Its intention to hold Bonds constitute a first (but not an ex•
a regular public meeting at 7:30 p.m.,on elusively first)Ilan on the net revenues of
Thursday,June 10,1976,at Ina Town Hall the System,subject and junior tO the prior , Johnny M. Garcia
(i.e., the Town'% Municipal Offices on and superior lien for the 1963 Bonds and ...---»._...._............. __ .» ..�... ..» .... .__..»..__..............
Armory Street) in Taos,New Mexico.At 1973 Bonds, and for equality among the
such meeting,the Board will adopt an or. 1976 Bonds in tha application of the net nyorn, declare and say that I am the (Business Manager) (Editor) of the
dinance relating to Its proposed Joint revenues.
Water and Sewer Extension Revenue Sections 19 through 11 set forth the terms T a o S New S
Bonds, Series 1976 and will consider and and conditions under which parity lion _ ,,,,•-•,,., , , ,,•,,,•••,•,,,„....................„_......•..... a weekly newspaper,
bonds may be Issued,permit the Issuance »...._...».�.».. ..„
take any other necessary businactioess
whit tng to of bonds having a subordinate lie, English Lan 8 e, and having a general circulation in the City and County
' such bonds end other business which may $� � $ $ $ Y
come before the Board. The tine and prohibit the Issuance of bonds having + New Mexico, and been anewspaper dui ualitied to publish legal notices
subject matter of such propose!ordinance superior lien,set out the terms and can. $ y 9 P $
Is as follows: ditions relative to refunding bonds and its under the provisions of Chapter 167 of the Session Laws of 1937: that the
AN ORDINANCE PROVIDING FOR he Townovide oco entantsve covenants with each bondhereby
older of which is hereto attached, was published in said paper once each week
THE EXTENSION, ENLARGEMENT, for Ilse protection of each bondholder �y P P P
BETTERMENT AND OTHER IM•
PROVEMENT Or- THE MUNICIPAL covering such matters as: use of bon
JOINT WATER A0O SEWER SYSTEM proceeds; payment of the 1976 Bonds; ,,,,,,,,,,,,,,Consecutive weeks, and on the some day of each week in the regular
OF THE TOWN OF TAOS, NEW charges for the use of the System;levy of
M E X I C O; DECLARING THE charges; efficient operation of 'he -r during the time of publication, and that the notice was published in the
NECESSITY FOR MAKING AND Sysl.,n; records; right to Inspect the
t ISSUING THE TOWN'S JOINT WATER System;
1em; au,ftb and ill np budgets
concerning
esr ling
AND SEWER EXTENSION REVENUE
BONDS. PAYABLE SOLELY OUT OF discontinuance ol service;use of1976Bortp r, and not in any supplement, once each week for............1.............................weeks
THE NET INCOME TO BE DERIVED Fund and Reserve Fund; charges and
FROM THE OPERATION OFIN SUCH liens prohibition the o nst5 competing mpetingsuranc sys system; •first publication being on the..........................day of....,May...............................
JOINT SYSTEM: AUTHORIZING THE
!SSUANCE AND SALE OF SUCH alienating System; extending interest
REVENUE BONDS IN THE payments; surety bonds, faithful per-
AGGREGATE PRINCIPAL AMOUNT OF formance of duties by Town;other liens; 9st publication on the........Z7...........day of...........MAY..................................1 19...7.6;
$500.000; PROVIDING FOR THE and Town's existence.
DISPOSITION OF THE INCOME TO BE Sections 22 through 33 concern events of said advertisement has been (duly made) or (assessed as court costs); that
DERIVED FROM THE OPERATION OF default and remedies for and duties upon Tas personal knowledge of the matters and thin set forth in this affidavit.
SAID JOINT SYSTEM; ADOPTING BY default, provide for prior charges upon P $ 85
REFERENCE CERTAIN PROVISIONS lower rates,defessance,delegate certain
OF ORDINANCE NO. 520, ADOPTED powers to Town officials, provide a i
AND APPROVED ON JULY 1, 1963; orocedure for amendment of the or.
PRESCRIBING OTHER DETAILS dinance, stale the ordinance is (� /f'ii•t G L4i' „ C tif✓�
CONCERNING SAID REVENUE BONDS, Irrepealable,provide for severability and
INCLUDING BUT NOT LIMITED TO repealer clauses, declare an emergency Editor-Manager
COVENANTS AND AGREEMENTS IN and provide for the'elfective data of the
CONNECTION THEREWITH; ordinance and a form for publication.
RATIFYING ACTION PREVIOUSLY •There is also a statement by the Mayor Subscribed and sworn to before me this...... .....................................
TAKEN CONCERNING SAiD JOINT that this ordinance is an emergency. _, .-r
SYSTEM AND SAID BONDS; COMPLETE COPIES OF THIS day o£...._.».»........... ...
REPEALING ALL ORDINANCES IN PROPOSED ORDINANCE ARE ON FILE ( 'C A.D. 19.`..„,',
.. _. �,...I,»..._...................................,
CONFLICT HEREWITH;and declearinp IN THE OFFICE OF THE TOWN CLERK, /
an emergency. MUNICIPAL OFFICES (ON ARMORY -
The following is a general summary of STREET)IN TAOS.NEW MEXICO,AND
the subject matter contained In Ordinance ARE AVAILABLE DURING NORMAL lam) ,�,�>,.
NESS HOURS OF ..._.._.» �:. ,. . _..... e............. ..........» .._.'i......._
No.Laa. THE TOWN AND LCLERK AR IUPON REQUEST NotaryPublicl
Preambles recite such matters the AND PAYMFMT OF A REASONABLE -
Town's existence and ownership of 1M CHARGE. '
municipal water and sewer system (the CWITNESS In
"System"). Its only present outstanding y hani and the seal of the My commission expires
obligations payable from revenues of the Town of Taos,New Mexico.this dayof
System being the issue of Joint Water and i1976.
Sewer Refunding Revenue Bonds,Series .••,•_• „,„„ ,•»,. »
July 1,19671"1963 Bonds")and the Issue of
Town Clerk . .».................». ». ».... .._ ........................................
Joint Water and Sewer Extension Revenue ' (Legal No.3229;Pub.May,27.1976)
Bonds,Series July 1.1973 1"1973 Bonds"),J
the need to extend, enlarge, better and
otherwise improve the System, the or.
dinances authorizing the 1963 Bondi and
the 1973 Bonds providing for the issuance
of bonds having a lien on the System on a
parity with the lien of the 1963 Bonds or the
1913 Bonds upon compliance with certain
conditions,but that such limitations may
not be met,the sufficiency of anticipated
revenues to pay outstanding and the
Proposed bonds, 1M receipt of a com-
mitment Irom the Unit(d States'01
America, Farmers Home Administration
1"FmHA")for the purchase of the Town's
Joint Water and Sewer Extension Revenue,
Bonds, Series 1976 ("1976 Bonds") to be
authorized for par and an Interest rate of
S%per annum; and the determination of
the Board of Trustees of the Town to
authorize the Issuance of the 1976 Bons
and of the Town's Joint Water and Sewer
Extension Revenue Bonds, Series 1976
1"1976 Bonds").
leetlons 1 throiph 1 define terms (in•
corporatin9 by reference same of the•
provlslons of Ordinance No.528) ,ratify
ac%n by officers of the Town in'can-
nection with the Project 04.,extending,
enlarging, bettering and otherwise im•
proving the System) and the 1976 Bonds,
establish that the water and sewer
facilities shall continue to be a single joint —5 6-
syttem and authorize the acquisition of the
Project.
Section S authorizes the 1976 Bons and
91ves details thereof, including but not
limited to:the lu on—,;a m..__.._...
•
EXHIBIT B
f
(Attach Affidavit of Publication of the
Ordinance Subsequent to Adoption) i
t
esfghlish The fiscal year for the •%Joseph me Gonzales
System, the for continued deposit Town Cier6
Into the Income Fund previously (SEAL)
established and provide for the Bond (Legal No.32":Hub.June 17.t976
Fund and Reserve Fund for the 1976
Bonds and other details concermnc
said funds and net revenues of iM .
System,for the administration of all
funds and accounts created or con
tinued by the ordinance, for the 'n
vestment of moneys in the funds,the
place%and limes of deposit of mono.
In the funds,that the 1976 Bonds snap
not be arbitrage bonds,that the 1976
`Bonds constitute a first (but"Of an
treve.exclusively first) to subject the net Affidavit of Publication
(revenutt of the System,wblect and
tfor'or to the prior and the 1%3 Bonds d�rloides
sand for *quality a...at the 1976 Now Mexico, 1
"was th the ippitcallon of/he no, } M.
avenues, if Taos J1
Ssdiam 19"WKVh M Mt forth the
erms and conditions under which
arity lien bonds may be issued. Johnny M. Garcia
ormit the Issuance of bonds having a -»—»• -
ubordinate lien, prohibit the -r
/ ►suance of bonds having a superior St duly sworn, declare and say that I am the (Business Manager) (Editor) of the
Ion.set out the terms and conditions
c slative to refunding bonds and T d O S News
irovide for protective covenants «.««
' whereby the Town covenant$ with `" " " " «"' •••'•. ` —` ' ' ` «- ••- a weekly newspaper,
' 'ach bondholder for the protection of in the English Language, and having a general circulation in the City and County
-ach bondholder covering such ,
c natters as: use of bond proceeds; Mate of New Mexico, and being a newspaper duly qualified to publish legal notices
t of the
of the the Systeondsim
charge$ 'tisements under the provisions of Chapter 167 of the Session Laws of 1937: that the
' or the use of the System IeVy 01 p P
harge%: efficient operation of the ii, a copy of which is hereto attached, wpa t.bl:sned in said paper once each week
iystem;records;tight 10Inspect the 1' p Pe
t iysten„ audits and budgets con* {
trocedurtt and dl$sonlinusnce of ,""'•"""'-•"-.........erning the System, billing consecutive weeks, and on the same day of each week in the regular
troced
service; ute of 1976 bond Fund and �e r during the time of publication, p
i ieserve Fund; charges and Ilene PBPe 8 p ication, an(1 that the notice was published in the
ipon the System; Insurance;
itlon against competing
system;
r, and not in an supplement, once each week for...........I. ...weeks
fystem; alienating sy$t*m; ex• Pry Y uPP .........................
lending Interest payments( wrety
rat publication being on Pte..._.2........._.day of....._...J u n.e..._...._............_.....
t publication on the.......1..7............day of..........._...Jun.e.......................... 19.....ZEz;
►id advertisement has been (duly made) or (assessed as court costs); that
s personal know( !the matters and things set in this affidavit.
Editor-Manager i
Subscribed and sworn to before me this...__ _ L ....._ .�._ .
day of..___.____...__ _...., _!�f>,.::...._.___ .« _.A.D., 19 jL .
Notary Public)
My commission expires
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x
0
CONSENT TO NOTICE OF SPECIAL
MEETING HELD ON JUNE 101 1976
TO THE BOARD OF TRUSTEES
OF THE TOWN OF TAOS
COUNTY OF TAOS
STATE OF NEW MEXICO:
The special meeting of the Board of Trustees
of the Town of Taos, which was held at the Town's Munici-
pal offices on Armory Street, in the Town of Taos, County
of Taos and State of New Mexico at 7 :30 p.m. , on Thursday,
the loth day of June, 1976, for the purpose of consider-
ing action relating to the Town'-s joint water and sewer
system and for the transaction of such other business
incidental to the foregoing as may come before said meet-
ing, was duly called by the undersigned Mayor more than
twenty-four hours prior to the start of such meeting.
ayor
Town C k
We, the undersigned members of the Board of
Trustees of the Town of Taos, do hereby acknowledge
receipt of written notice of such special meeting of
June 10, 1976. We were given nol--1-ce of such meeting (in-
cluding the time, place and the matters to be acted upon,
i.e. , Ordinance No. 640) by Taos News
at least
twenty-four hours prior to such meeting. We hereby waive
any and all irregularities, if any, in such nc tice and in
the manner of service thereof upon us, and consent and
agree to the holding of such special meeting at the time
and place specified in said notice, and to the transaction
of any and all business which came before such meeting.
BOARD OF TRUSTEES
-58-
STATE OF NEW MEXICO )
GENERAL AND
COUNTY OF TAOS ) SS.
NO-LITIGATION CERTIFICATE
TOWN OF TAOS )
IT IS HEREBY CERTIFIED by the undersigned, the
duly chosen, qualified and acting Mayor, Town Clerk-
Treasurer and Town Attorney of the Town of Taos (herein
the "Town") , in the County of Taos and State of New Mexico :
1. As determined by the federal census of 1970,
the population of the Town was 2 ,475, and the present es-
timated population is 2950
2 . The Town was incorporated pursuant to and is
now operating under the general laws of the State of New
Mexico as a Town; the Town was incorporated as a Town on
ti
the 7th day of May, 1934; and the validity of such incor-
poration and organization has never been questioned.
3. The Town as originally incorporated has nev-
er bean consolidated with or annexed to any other munici-
pality, and no territory has been disconnected from the
Town as originally incorporated.
4. From at least the first day of March, 1916
up to and including the date of this certificate, the fol-
lowing have been and now are the duly chosen , qualified
and acting officers of said Town:
Mayor: Phillip Cantu, Jr.
Trustees : Lawrence Santistevan
Fernando Valdez
Joe A. Sanchez
Eloy Jeantete
Town Manager: Ernest Romero
Town Clerk-Treasurer: Josephine Gonzales
Town Attorney: James M. Brandenburg
5. There is no reason within our knowledge why
the Town may not deliver its "Town of Taos Joint Water
and Sewer Extension Revenue Bonds, Series 1976" in the ag-
gregate principal amount of $500 , 000 (herein the "Bonds"
or "1976 Bonds" ) , which are being delivered originally as
a single bond in the denomination of $500, 000.
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6. Subsequent to the authorization to issue the
1976 Bonds, the Town has not pledged or otherwise encum-
bered any of the revenues derived from the operation of
its joint water and sewer system (as defined in Ordinances
Nos. 528 , 621 and 640 and herein the "System" ) or any part
thereof; and there are no liens or encumbrances of any
kind or description against such revenues of the System
except the liens or encumbrances designated in Ordinance
No. 528, adopted and approved on July 1 , 1963 , authorizing
the Town of Taos Joint Water and Sewer Refunding Revenue
Bonds, Series July 1, 1963 , in Ordinance No. 621, adopted
and approved on May 1 , 1973 , authorizing the issuance of
the Town of Taos Joint Water and Sewer Extension Revenue
Bonds, Series May 1 , 1973, and in Ordinance No . 640 ,
adopted and approved on June 10 , 1976 , authorizing the is-
suance of the 1976 Bonds.
7. No litigation, of any nature is now pending
or insofar as is known to the undersigned, threatened (ei-
ther in state or federal courts) restraining or enjoining
the issuance, sale , execution or delivery of the 1976
Bonds, the extending, enlarging, bettering and other im-
proving of the System (herein the "Project") , or the levy,
fixing, charging, collection or application of adequate
revenues, rates and charges to pay the cost of operation
and maintenance of the System and the payment of the prin-
cipal of and interest on the 1976 Bonds or the pledge
thereof or otherwise carrying out the terms and provisions
of the ordinances and resolutions authorizing the issuance
of said 1976 Bonds or otherwise concerning them . and the
covenants and agreements therein, or in any manner ques-
tioning or otherwise affecting the validity thereof;
neither the corporate existence or boundaries of the Town
nor the title of its present officers to their respective
offices is being contested; and no proceedings or author-
ity for the issuance, sale, execution or delivery of said
1976 Bonds have, or has been repealed, rescinded, revoked,
modified, changed or altered in any manner.
8. The regular meetings of the Board of
Trustees are scheduled to be held at the Town ' s Municipal
Offices, on Armory Street, within the Town at the hour of
7 : 30 p.m. , on the second Wednesday of each month.
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9. No referendum petition concerning any of
the ordinances, resolutions, or other proceedings concern-
ing the Project, any of the revenues of the System, and
rates and revenues of the 1976 Bonds to be issued, has
been filed; and to the best of our knowledge, none is be-
ing circulated or planned for circulation.
10. The population of the Town is not less than
seventy-five percent English speaking , and is less than
twenty-five percent Spanish speaking.
11. To the best of our knowledge, neither the
Mayor, any member of the Board of Trustees, nor any other
officer, employee , or any other agent of the Town is in-
terested (except in the performance of his official rights,
privileges, powers and duties) , directly or indirectly, in
the profits of any contract, or job of work, or services
to be performed , appertaining to the issuance of the Bonds
or to the effecting of the Project .
i
12. The Town has no written bylaws or rules of
procedure.
13. The Taos News is a legal newspaper which
maintains an office in and is of general circulation in
Taos, New Mexico.
14 . The Town owns its own source of water supply
and does not purchase water for distribution.
15 . The Town has not adopted the New Mexico Pub-
lic Service Commission regulatory and supervisory provisions
of Chapter 84 , Laws of New Mexico, 1941, pursuant to the
.local option provisions of ;section 17A of said Chapter 84 ,
also cited as Section 68-5-5, New Mexico Statutes Annotated,
1953 Compilation, or otherwise.
16. The 1976 Bonds are not obligations (A) which
are issued as part of an issue all or a major portion of
the proceeds of which are to be used directly or indirectly
in any trade or business carried on by any person who is
not an exempt person within the meaning of paragraph (3) of
Section 103 (c) , United States Internal Revenue Code of 1954 ,
as amended (herein the "Tax Code" ) , and (B) the payment of
the principal or interest on which (under the terms of such
obligations or any underlying arrangement) is, in whole or
-61-
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in major part (i) secured by any interest in property used
a or to be used in a trade or business or in payments in
respect of such property, or (ii) to be derived from pay-
ments in respect of property, or borrowed money, used or
to be used in a trade or business. Thus the 1976 Bonds are
not "industrial development bonds" within the meaning of
Section 103 (c) , Tax Code, and the applicable regulations
thereunder promulgated by the Internal Revenue Service.
17 . Federal grants or loans for the Project be-
ing financed by the 1976 Bonds have been or will be re-
ceived from the U.S. Economic Development Administration;
and to the best of our knowledge, the necessary proceed-
ings relating to required federal environmental impact
statements have been taken. Except as aforesaid , such
Project will not be supported in whole or in part through
any other contracts entered into by or grants, subsidies,
loans or other forms of funding assistance made by any
agency of the United States Government, and such Project
does not and will not involve a lease entered into by or
a permit, license, certificate or other entitlement for
use issued by any agency of the United States Government .
18 . The Board of Trustees gave two weeks' notice
by publication of the meeting at which Ordinance No. 640
was adopted , in conformity with Section 5-6-23 , NMSA, 1953
Compilation, as amended, and with Resolution No. 76-3 ,
adopted by the Board of Trustees on March 24 , 1976 (super-
seding Resolution No. 741 , which previously established
standards as to what constitutes reasonable notice of Board
meetings) and Section 14-16-2 . 1, NMSA 1953 . No meetings of
a quorum of the Board of Trustees discussing the 1976 Bonds
or the Project to be financed by the 1976 Bonds occurred
subsequent to October 16, 1974 without compliance with
Section 5-6-23, NMSA, 1953 Compilation, as amended , and
either Resolution No. 741 or Resolution No. 76-3 , whichever
was then applicable.
19. This certificate is for the benefit of
each holder of any of the 1976 Bonds from time to time.
IN WITNESS WHEREOF, we have hereunto set our
hands and affixed the seal of the Town of Taos, in the
-62-
County of Taos and State of New Mexico, this 20th day of
August , 1976.
CC
ayo
/ T.60n Cler easurer
(SEAL)
Town Attorney
-63-
STATE OF NEW MEXICO )
)
COUNTY OF TAOS ) SS. SIGNATURE CERTIFICATE
)
TOWN OF TAOS }
We, the undersigned, the duly qualified and act-
ing Mayor, Clerk and Treasurer of the Town of Taos (the
"Town") , Taos County, New Mexico, do hereby certify:
1. The undersigned at the date of the signing
hereinafter stated, and on the date hereof , are the duly
chosen, qualified and acting officers authorized to execute
the non-negotiable single bond hereinafter described and
hold the offices indicated by the official titles set oppo-
site our respective names.
2. On AiigiLQt 2Q, 1976 , the undersigned Mayor,
Town Clerk and Town Treasurer officially signed, manually
subscribed, executed and attested the non-negotiable single
bond numbered R-1 described as the "Town of Taos Joint
Water and Sewer Extension Revenue Bond, Series 1976" (the
"Bond" ) in the aggregate principal amount of $500, 000, or
such lesser sum as shall represent the aggregate advances
made to the Town by the Farmers Home Administration of the
United States Department of Agriculture, authorized by Or-
dinance No. 640, passed, adopted, signed and approved on
June 10, 1976.
3 . The seal. of the Town which has been impressed
on the bond is the legally adopted, proper and only official
corporate seal of the Town.
WITNESS our hands and the seal of the Town this
20th day of August , 1976.
TERM OF OFFICE
SIGNATURE OFFICIAL TITLE EXPIRES
C Mayor March 7 8"
Town Clerk N/A
Town Treasurer N/A
EA4f/
The signatures above guaranteed as those of the
officers designated above.
First State Bank of Taos BANK
(BANK SEAL) By /s � �.,._.✓
-64- /
STATE OF NEW MEXICO )
DELIVERY CERTIFICATE
COUNTY OF TAOS ) SS.
AND RECEIPT
TOWN OF TAOS )
We, the undersigned, the duly qualified and act-
ing Mayor, Clerk and Treasurer of the Town of Taos, Taos
County, New Mexico, do hereby certify:
1. On A„g„st 2.0_, 1976, the undersigned
Treasurer delivered to the United States of America, Farmers
Home Administration, Department of Agriculture ("FmHA") the
non-negotiable single bond numbered R-1 in the aggregate
principal amount of $500 ,000, designated as the Town of
Taos Single Registered Joint Water and Sewer Extension
Revenue Bond, Series 1976 ("Bond" ) , and received from the
FmHA in payment therefor, the sum of $500,000.
2. On such date, we dated such Bond numbered R-1
with such date of delivery.
3. At the time of said delivery, no coupons were
attached to the Bond because the Bond was registered as to
both principal and interest as provided in paragraph 4
hereof.
4. Simultaneously with the delivery of the Bond,
the Clerk entered the name "United States of America, Farm-
ers Home Administration" in the registration book estab-
lished for that purpose as the initial owner of the Bond .
WITNESS our hands and the seal of the Town this
20th day of August , 1976.
May
T w -1 k
Town Tr a su r e r
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STATE OF NEW MEXICO )
BOND PROCEEDS
COUNTY OF TAOS ) SS.
j INVESTMENT CERTIFICATE
TOWN OF TAOS )
I, the undersigned, the duly qualified and act-
ing Town Manager of the Town of Taos ("Town") , Taos County,
New Mexico, do hereby certify that I have, either alone or
with others, the responsibility for the issuance by the
Town on the date hereof of its "Town of Taos Joint Water
and Sewer Extension Revenue Bond, Series 1976" ("Bond") in
the aggregate principal amount of $500, 000, which is being
issued to finance the extension, enlargement, betterment
and other improvement of the Town's municipal joint water
and sewer system ("Project") and that I reasonably expect
that:
1. The total cost of the Project will be
$ 500 ,000 . 00
2. Construction work on the Project commenced
on n . _ _mh _r �, 1975 and completion of the
B�
Project will occur no later than August 2Q,, 197 7
3. The Town has heretofore entered into binding
contracts in connection with the Project with a firm of
consulting engineers pursuant to which the Town will expend
more than $12 , 500 (2-1/2% of the principal amount of such
Bond) of the proceeds of the Bond on the Project.
4 . The "original proceeds" of the Bond are
$500, 000 (i.e. , the principal amount of $500, 000 plus $-0-
received by the Town as accrued interest) .
5. The amount of "original proceeds" to be
expended on the Project during the three-year period begin-
ning on the date the Bond is delivered ("temporary period")
iE. $500, 000.
6. All of the investment proceeds to be received
during the temporary period will be expended for payment of
a Project costs during the temporary period.
7 . The Town will not sell or otherwise dispose
of the Project in whole or in part prior to the maturity of
the Bond.
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8. The Town has not yet expended any money for
the Project and foes not reasonably expect to use the
proceeds of the Bond to fund or refinance any Town obliga-
tions (including any governmental obligations issued for
temporary financing) .
9. The Town has never issued bonds or other
obligations to finance the specific Project being financed
with the proceeds of the Bond. Consequently, the Bond does
not constitute a replacement issue of obligations.
10. Based upon the foregoing:
(a) At least 85% of the "original pro-
ceeds" will be lawfully expended on the Project
during the temporary period,
a
(b) The Town has heretofore incurred a
substantial binding obligation to commence the
Proj ect,
(c) Work on the Project will proceed
with due diligence to completion, and
(d) The "original proceeds" of the
Bond will not exceed by more than 5% the amount
necessary to finance the Project .
On the basis of all the facts, estimates and cir-
cumstances now in existence, it is not now expected that
the proceeds of the Bond will be used in a manner that
would cause the Bond to be an "arbitrage bond" within the
meaning of Section 103 (d) of the Internal Revenue Code of
1954 , as amended, and the regulations prescribed under that
section. To the best of my knowledge and belief, there are
no other facts, estimates or circumstances that would mate-
rially change the foregoing conclusion. The Town has not
been notified of any listing or any proposed listing of it
by the Internal Revenue Service as an issuer whose arbitrage
certificates may not be relied upon.
t
WITNESS my hand and the seal of the Town this
' 20th day of August , 1976.
t
Town Manager
i
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TOWN OF TAOS
ORDINANCE
YEAR:
NUMBER: L Ll0
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STATE OF NEW MEXICO )
COUNTY OF TAOS ) SS.
)
TOWN OF TAOS )
The Board of Trustees of the Town of Taos in
the County of Taos and State of New Mexico, met in public
regular session, in full conformity with law and the or-
dinances and rules of said Board at the Town Hall U .P. ,
the Town ' s Municipal Offices) on Armory Street, in the
Town of Taos , being the regular meeting place of said
Board at the hour of 7:30 p.m. , on Thursday , the loth
day of June, 1976 , and upon roll call the following were
found to be present, constituting a quorum:
Present:
Mayor: Phillip Cantu, Jr.
Trustees : Lawrence Santistevan
Fernando Valdez
Joe A. Sanchez
Absent•: Eloy Jeantete
constituting all the members thereof.
There were also present:
Clerk-Treasurer: Josephine Gonzales
Town Attorney: James M. Brandenburg
City Manager: Ernest Romero
Thereupon, the following proceedings, among
others, were had and taken , to wit:
Trustee Fernando Valdez introduced the fol-
lowing ordinance which is as follows :
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I
ORDINANCE NO. 640
AN ORDINANCE PROVIDING FOR THE EXTENSION, EN-
LARGEMENT, BETTERMENT AND OTHER IMPROVEMENT OF .
THE MUNICIPAL JOINT WATER AND SEWER SYSTEM OF
THE TOWN OF TAOS, NEW MEXICO; DECLARING THE
NECESSITY FOR MAKING AND ISSUING THE TOWN ' S
JOINT WATER AND SEWER EXTENSION REVENUE BONDS,
PAYABLE SOLELY OUT OF THE NET INCOME TO BE
DERIVED FROM THE OPERATION OF SUCH JOINT SYS-
TEM; AUTHORIZING THE ISSUANCE AND SALE OF SUCH
REVENUE BONDS IN THE AGGREGATE PRINCIPAL AMOUNT
OF $500 , 000; PROVIDING FOR THE DISPOSITION OF
THE INCOME TO BE DERIVED FROM THE OPERATION OF
SAID JOINT SYSTEM; ADOPTING BY REFERENCE CER-
TAIN PROVISIONS OF ORDINANCE NO. 528 , ADOPTED
AND APPROVED ON JULY 1, 1963 ; PRESCRIBING OTHER
DETAILS CONCERNING SAID REVFNUE BONDS, INCLUD-
ING BUT NOT LIMITED TO COVENANTS AND AGREEMENTS
IN CONNECTION THEREWITH; RATIFYING ACTION PRE-
VIOUSLY TAKEN CONCERNING SAID JOINT SYSTEM AND
SAID BONDS; REPEALING ALL ORDINANCES IN CON-
FLICT HEREWITH; AND DECLARING AN EMERGENCY.
WHEREAS , the Town of Taos (herein "Town" ) , Taos
County, New Mexico, now owns, operates and maintains a
joint public utility constituting a joint water and sewer
system (herein sometimes designated as the "system" , the
"joint system" or the "joint utility") ; and
WHEREAS, the Town pursuant to Ordinance No . 528 ,
duly adopted and approved on July 1, 1963 , has heretofore
issued and delivered all bonds of the issue designated
"Town of Taos Joint Water and Sewer Refunding Revenue
Bonds, Series July 1, 1963" (herein the "1963 Bonds" ) , in
the aggregate principal amount of $405 , 000, dated July 1 ,
1963 , consisting of 45 bonds in the denomination of $1 , 000
and $5, 000 each, of which issue there are outstanding and
unpaid bonds in the aggregate principal amount of
$215 , 000 ; and
WHEREAS, all of the bonds refunded by the 1963
Bonds now have been paid in full and redeemed, e .g. , prin-
cipal, interest and any prior redemption premium; and
WHEREAS, pursuant to Ordinance No. 622 , duly
adopted and approved on the first day of May, 1973 , the
Town has issued its "Town of Taos Joint Water and Sewer
Extension Revenue Bonds, Series May 1, 1973" (herein the
"1973 Bonds" ) , in the aggregate principal amount of $200 , 000,
consisting of 40 bonds in the denomination of $5, 000 each,
of which issue $195 , 000 of the bonds remain outstanding;
and
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WHEREAS, except as aforesaid, the Town has
never pledged nor in any way hypothecated revenues de-
rived and to be derived from the operation of the system,
or any part thereof, to the payment of any bonds or for
any other purpose (excluding proceedings authorizing the
issuance of bonds which have heretofore been redeemed in
full, both principal and interest) with the result that
the revenues to be derived from the system may now be
pledged lawfully and irrevocably for the redemption of
additional bonds payable from revenues derived from the
operation of the system; and
WHEREAS, Section 19 of such Ordinance No. 528
(herein "Ord. No. 528" ) and Section 20 of such Ordinance
No. 621 (herein "Ord. No. 622 *') specify limitations upon
issuance of parity obligations, but such .limitations
presently may not be met and also may not be met at the
time of the delivery of the bonds; and
WHEREAS, the present water facilities and sewer
facilities of the Town are insufficient, and the present
joint system is inadequate to meet the needs of the Town
and the inhabitants thereof ; and
WHEREAS, the Board of Trustees of the Town
(herein sometimes designated as the "Board" or the "Gov-
erning Body") has determined, and does hereby determine
that it is necessary and for the best interest of the
Town and the inhabitants thereof that its joint system
be extended, enlarged, bettered and otherwise improved ;
and
WHEREAS , the gross income anticipated to be de-
rived from the system is in excess of requirements for
operation and maintenance of the system and the payment
of the outstanding 1963 Bonds and 1973 Bonds and pursu-
ant to the statutes of the State of New Mexico such excess
income may lawfully be pledged to secure the redemption
of the 1976 ronds herein authorized to be issued (provided
that such 1976 Bonds shall have a lien on the net revenues
of the system which is junior and subject to the liens
thereon of the 1963 Bonds and the 1973 Bonds) ; and
WHEREAS, the United States of America, acting
by and through the Farmers Home Administration (herein
"FmHA" ) , United States Department of Agriculture, has
agreed to purchase the bonds herein authorized at par and
an interest rate of 5% per annum.
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NOW, THEREFORE, BE IT ORDAINED BY THE GOVERNING
BODY (I .E. , THE BOARD OF TRUSTEES) OF THE TOWN OF TAOS,
NEW MEXICO:
Section 1. Definitions.
A. Adoption of Certain Definitions. The
following designated terms, namely: Independent Account-
ant, Insured Bank, net revenues, net income, operation
and maintenance expenses, revenues, gross revenues, income
and gross income, being defined for all purposes of this
ordinance and of any ordinance amendatory hereof or supple-
mental hereto, or relating hereto, and of any instrument
or document appertaining hereto, except where the context
by clear implication otherwise requires , shall have the
meanings set forth in Section 1 of Ord. No. 528 , which
meanings are hereby adopted by reference thereto as if set
forth verbatim in full in this ordinance; provided , however,
that all references in said Section 1 of Ord. No. 528 to
"this ordinance" shall be construed as referring to the or-
dinance herein set forth and not to Ord . No. 528 .
B. Other Definitions :
(1) "Bonds" or ".1976 Bonds" means the
"Town of Taos Joint Water and Sewer Extension Revenue Bonds ,
Series 1976" , authorized by this ordinance (including any
single bond as provided herein) .
(2) "1973 Bonds" means the "Town of
Taos Joint Water and Sewer Extension Revenue Bonds , Sc=ies
May 1, 1973" , authorized by Ord. No. 622 .
(3) "1963 Bonds" means the "Town of
Taos Joint Water and Sewer Refunding Revenue Bonds, Series
July 1, 1963" , authorized by Ord. No. 528.
(4) "Ord . No. 528" means Ordinance
No. 528 of the Town which was adopted and approved by the
Board on July 1, 1963 .
(5) "Ord. No. 622 " means Ordinance
No. 621 of the Town which was adopted and approved by the
Board on May 1 , 1973 .
(6) "Board" or "Governing Body" means
the Board of Tr,..+tees of the Town or any succeeding legis-
lative body of the Town, as such body from time to time
may be constituted.
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(7) "Consulting Engineer" means any
registered or licensed professional engineer or firm of
such engineers having a wide and favorable repute for
skill and experience in the field of designing, preparing
plans and specifications for, and supervising construction
of water systems and facilities , and sewer systems and
sewer facilities , entitled to practice and practicing as
such under the laws of the State of New Mexico, retained
and compensated by the Town, but not in the regular em-
ploy of the Town; but, as to any construction drawings
and specifications prepared for the Project by Town em-
ployees working on force account or otherwise under the
supervision of the Town Engineer, this term may include
the Town Engineer.
(8) "Fiscal Year" means the twelve-
month period which the Town or other appropriate authority
heretofore has established or hereafter may establish as
the fiscal year for the system.
(9) "FmHA" means the United States
of America, Farmers Home Administration, Department of
Agriculture.
(10) "Income Fund" means the "Town
of Taos Joint Water and Sewer System Gross Income Fund" ,
originally created in Ord. No. 528 , which is authorized
to be continued in Section 14 hereof.
(11) "Joint Water and Sewer System" ,
"Joint System" , ",joint system" , joint utility" , "System" ,
"system" or "Utility" means the municipally owned public
utility designated as the Town' s water system and sewer
system (constituting a joint system) , consisting of all
properties, real, personal, mixed or otherwise , now owned
or hereafter acquired by the Town through purchase, con-
struction or otherwise, and used in connection with said
water system and sewer system of the Town and in anywise
appertaining thereto, whether situated within or without
the limits of the Town.
(12) "Operation and Maintenance Fund"
means the "Town of Taos Joint Water and Sewer Operation
and Maintenance Fund" which was originally created by said
Ord. No. 528 , which is authorized to be continued by Sec-
tion 15 hereof.
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(13) "Paying Agent" means the office
of the Town Treasurer, Taos, New Mexico, or as to any
1976 Bonds owned or insured by the FmHA at the Finance
Office of the FmHA located at 1520 Market Street, St.
Louis, Missouri 63103, or such other place as the FmHA
may designate in writing.
(14) "Project" means extending, en-
larging, bettering and otherwise improving the joint
system.
C. Construction. Definitions include
both singular and plural. Pronouns include both singular
and plural and cover all genders .
Section 2 . Ratification. All action heretofore
taken (not inconsistent with the provisions of this ordi-
nance) by the Board and the officers of the Town directed
toward the Project and toward the issuance of the Town' s
1976 Bonds for that purpose, including the sale thereof
to the FmHA be, and the same hereby is ratified, approved
and confirmed.
Section 3 . Joint System. The water and sewer
facilities of the Town shall continue to constitute a
single joint public utility designated as the Town of Taos
joint water and sewer system and shall hereafter be oper-
ated and maintained as such for so long as the 1976 Bonds
are outstanding.
Section 4 . Authorization of Project. The
Project shall be acquired at a total estimated cost of not
exceeding $500, 000 , excluding any such cost defrayed or to
be defrayed by any source other than proceeds from the
1976 Bonds .
Section 5 . 1976 Bonds.
A. Authorization of the 1976 Bonds. For
the purpose of defraying a part of the cost of the Project,
pursuant to Sections 14-30-1 through 14-30-11, New Mexico
Statutes Annotated, 1953 Compilation, as amended , the Town
shall issue the "Town of Taos Joint Water and Sewer Exten-
sion Revenue Bonds, Series 1976", in the aggregate princi-
pal amount of $500, 000 .
B. 1976 Bond Details. The 1976 Bonds , ex-
cept as otherwise herein provided, shall be dated as of
delivery , shall consist of 500 bonds in the denomination
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of $1, 000, numbered consecutively from 1 to 500 , inclu-
sive, shall bear interest from the date of such bonds to
their respective maturities at the rate of 5% per annum
evidenced by one set of interest coupons payable to
bearer (unless registered as to payment of principal and
interest as herein provided) , such interest being payable
semiannually on May 1 and November 1 in each year , commenc-
ing November 1, 1976, and shall mature serially in regular
numerical order on November 1, as follows:
Bond Numbers Amounts Years
(All Inclusive) Maturing Maturing
1 - 5 $ 5 , 000 1978
6 - 10 5 , 000 1979
11 - 15 5 , 000 1980
16 - 20 5 , 000 1981
21 - 25 5 , 000 1982
26 - 30 5 , 000 1983
31 - 35 5 , 000 1984
36 - 40 5 , 000 1985
41 - 50 10 , 000 1986
51 - 60 10 , 000 1987
61 - 70 10 , 000 1988
71 - 100 30 , 000 1989
101 - 130 30 , 000 1990
131 - 160 30 , 000 1991
161 - 190 30 , 000 1992
191 - 220 30 , 000 1993
221 - 260 40 , 000 1994
261 - 300 40, 000 1995
301 - 340 40 , 000 1996
341 - 380 40 , 000 1997
381 - 420 40 , 000 1998
421 - 460 40 , 000 1999
461 - 500 40 , 000 2000
Both principal and interest are payable in lawful money
of the United States of America, without deduction for
exchange or collection charges at the Paying Agent. If
any 1976 Bond shall not be paid at maturity upon presen-
tation and surrender, it shall continue to bear interest
at the rate of 5% per annum until paid in full. Any reg-
istered single 1976 Bond issued as hereafter provided
shall mature in installments in the amounts and on the
dates set forth above.
C. Prior Redemption . 1976 Bonds maturing
on and after November 1, 1986 shall be subject to redemp-
tion prior to their respective maturities , in whole or in
part in inverse numerical order on November 1, 1985, or
on any interest payment date thereafter for their princi-
pal amount and accrued interest to the redemption date.
Additionally, any 1976 Bonds owned or insured by the FmHA
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are subject to redemption prior to their respective
maturities, in inverse numerical order, on any interest
payment date for the principal amount thereof and in-
terest accrued to the redemption date. The Town also
reserves the right, at its option, to redeem on any in-
terest payment date for the principal amount thereof and
accrued interest to the redemption date any 1976 Bonds
in inverse numerical order in the event there are pro-
ceeds from the 1976 Bonds unused and unencumbered at the
time the Project is completed. In the case of a regis-
tered single 1976 Bond, installments of principal shall
be subject to prepayment as if evidenced by the above-
designated bonds in the denomination of $1, 000 each.
Notice of prior redemption shall be given
by the Town Treasurer in the name of the Town by one pub-
lication, at least thirty days prior to the redemption
date in a newspaper printed in the English language of
general circulation in the Town. A copy of the notice
shall be mailed at least thirty days prior to the redemp-
tion date to the Paying Agent and any holder whose name
and address appears on the registration books . So long
as any 1976 Bond is owned or insured by the FmHA, notice
shall also be mailed to the FmHA at least thirty days
prior to the redemption date at such address as the FmHA
may designate. If on any redemption date, the FmHA owns
all outstanding 1976 Bonds and coupons, if any, it may
waive any requirement of published notice. The notice
shall identify the 1976 Bonds (or in the case of a regis-
tered single bond, the installments of principal thereof)
to be redeemed, specify the redemption date, and state
that on such date the principal amount thereof and ac-
crued interest to the redemption date will become due
and payable and thereafter interest will cease to accrue .
After such notice and presentation of the 1976 Bonds , to-
gether with any coupons maturing subsequent to the redemp-
tion date, the 1976 Bonds called for redemption will be
paid.
D. Negotiability. Each 1976 Bond shall
be negotiable and payable to bearer or , if registered, to
the registered holder. The 1976 Bonds and coupons shall
have all the qualities of negotiable paper and each hold-
er shall possess all rights enjoyed by holders of negoti-
able instruments under the Uniform Commercial Code - In-
vestment Securities.
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E. Registration.
(1) Any 1976 Bond may be registered
for payment only a�i to both principal and interest. The
Town Treasurer is appointed registrar (the "Registrar" )
and shall maintain books for the registration, transfer
and conversion of 1976 Bonds. The Registrar shall regis-
ter or permit to be transferred or discharged from regis-
tration any 1976 Bond presented for such purpose subject
to such reasonable regulations as the Registrar may pre-
scribe and upon reimbursing the Town for any tax or gov-
ernmental charge payable in connection. therewith.
(2) Upon presentation of any 1976
Bond to the Registrar, accompanied by all unmatured cou-
pons, the Registrar shall note such registration on the
books and on the registration panel on the back of the
1976 Bond and shall detach and cancel the unmatured cou-
pons. Any registered 1976 Bond may be transferred only
upon a duly executed assignment by the registered owner
or his legal representative in form satisfactory to the
Registrar. Such transfer shall be noted on said books
and on the 1976 Bond. The principal and interest of any
registered 1976 Bond shall be payable only to, or upon
the order of, the registered owner or his legal represen-
tative. Any registered 1976 Bond may be converted into a
coupon 1976 Bond of the same series payable to bearer upon
presentation to the Registrar accompanied by an authoriza-
tion in form satisfactory to the Registrar . The Registrar
shall attach new coupons representing interest to become
due thereafter and shall note on the 1976 Bond that it is
payable to bearer. Upon conversion of 1976 Bonds, the
Registrar shall require the payment of all expenses incur-
red by the Town in preparing new coupons.
(3) The Town and the Registrar may
treat the bearer of any unregistered 1976 Bond or 1976
Bond registered to bearer or coupons appurtenant thereto
as the absolute owner thereof, whether or not such 1976
Bond or coupon shall be overdue. The Town and its offi-
cers may treat the person in whose name any 1976 Bond is
registered as the absolute owner, whether or not such
1976 Bond shall be overdue. All payments made as provided
in this ordinance shall be valid and effectual to dis-
charge the liability upon any 1976 Bonds to the extent of
the amount so paid.
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Section 6 . Execution of 1976 Bonds .
A. Execution. The 1976 Bonds shall be
authenticated with the facsimile signature of the Mayor,
shall be executed and authenticated with the manual sig-
nature of the Town Treasurer, shall be attested with the
facsimile signature of the Town Clerk and shall be impress-
ed with a facsimile of the corporate seal of the Town.
The interest accruing to maturity on the 1976 Bonds (other
than any registered single 1976 Bond) shall be evidenced
by interest coupons thereto attached authenticated by the
facsimile signature of the Town Treasurer, which officer
by the authentication of the 1976 Bonds shall adopt as
and for his or her signature the facsimile thereof appear-
ing on the coupons. The 1976 Bonds and coupons bearing
the signatures of the officers in office at the time of
the signing thereof shall be the valid and binding obliga-
tions of the Town, notwithstanding that before the delivery
thereof and payment therefor, any or all of the persons
whose signatures appear thereon shall have ceased to fill
their respective offices. The Mayor, the Town Treasurer
and the Town Clerk, at the time of the execution of the
1976 Bonds and of a signature certificate by each of them,
each may adopt as and for his or her own facsimile signa-
ture the facsimile signature of his or her predecessor in
office in the event that such facsimile signature appears
upon any of the 1976 Bonds or coupons appertaining thereto.
B. Filing of Signatures. Prior to the
execution of any 1976 Bond, pursuant to Sections 5-9-1 to
5-9-6 , inclusive, New Mexico Statutes Annotated, 1953 Com-
pilation, as amended, the Mayor, Town Clerk and Town
Treasurer shall each file with the Secretary of State of
the State of New Mexico his or her manual signature cer-
tified by him or her under oath; provided that such filing
shall not be necessary (1) for any officer where any pre-
vious such filing may have legal application to the 1976
Bonds or (2) if no 1976 Bond is signed with a facsimile
signature nor sealed with a facsimile seal of the Town.
Section 7 . Special Obligations. All of the
1976 Bonds, together with the interest accruing thereon,
shall be payable and collectible solely out of the net in-
come to be derived from the operation of the System, the
net income of which is so pledged. The holder or holders
thereof may not look to any general or other fund for the
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payment of principal and interest on such obligations
except the designated special funds pledged therefor.
The 1976 Bonds shall not constitute an indebtedness or
a debt within the meaning of any constitutional or stat-
utory provision or limitation, and shall not be consid-
ered general obligations of the Town.
Section 8. 1976 Bond and Coupon Forms. The
1976 Bonds, the coupons and registration grid shall be in
substantially the following form:
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(Form of Bond)
UNITED STATES OF AMERICA
STATE OF NEW MEXICO COUNTY OF TAOS
TOWN OF TAOS
JOINT WATER AND SEWER EXTENSION REVENUE BOND
SERIES 1976
No. $1,000
The Town of Taos (the "Town") , Taos County,
New Mexico, for value received, hereby promises to pay,
upon presentation and surrender of this bond, to the
bearer hereof, or if this bond is registered, to the f
registered owner hereof, solely from the special funds
provided therefor, on November 1, the principal
sum of
ONE THOUSAND DOLLARS
and to pay solely from said special funds interest here-
on from the date hereof at the rate of five percent (5%)
per annum, evidenced until maturity by the set of coupons
appertaining hereto, being payable semiannually on May 1
and November 1 in each year commencing November 1 , 1976 ,
upon presentation and surrender of the annexed coupons as
they severally become due, or if this bond is registered ,
to the registered owner hereof. If upon presentation at
maturity, payment of this bond is not made as herein pro-
vided, interest shall continue at the above rate until
the principal hereof is paid in full . Both principal and
interest are payable in lawful money of the United States
of America, without deduction for exchange or collection
charges, at the Office of the Town Treasurer, in Taos ,
New Mexico, or as to any bond or coupon owned or insured
by the Farmers Home Administration (the "FmHA") of the
United States Department of Agriculture, at the Finance
Office of the FmHA located at 1520 Market Street, St.
Louis, Missouri 63103 , or at such other place as the
FmHA may designate in writing .
This bond is one of a series of 500 bonds e
"1976 Bonds") of like tenor and amount, except as to num-
ber, maturity and prior redemption option, authorized for
the purpose of paying the costs of extending, enlarging ,
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bettering and otherwise improving the municipal joint
water and sewer system (the "System") .
1976 Bonds maturing on and after November 1,
1986, are subject to prior redemption in inverse numeri-
cal order at the option of the Town on November 1, 1985 ,
or on any interest payment date thereafter, at a price
equal to the principal amount thereof and accrued inter-
est thereon to the redemption date. Additionally, any
1976 Bonds then owned or insured by the FmHA are subject:
to redemption prior to their respective maturities in
inverse numerical order on any interest payment date
for the principal amount thereof and accrued interest to
the redemption date. The Town also reserves the right,
at its option, to redeem on any interest payment date
for the principal amount thereof and accrued interest to
the redemption date, any or all of the 1976 Bonds in
inverse numerical order in the event there are 1976 Bond
proceeds unused and unencumbered at the time construction
of the project being financed by the 1976 Bonds is com-
pleted. Redemption shall be made upon not less than
thirty days' prior notice in the manner and upon the con-
ditions provided in Ordinance No. 640 , adopted and ap-
proved on June 10 , 1976 (the "Ordinance") which
authorizes the issuance of the 1976 Bonds.
This bond does not constitute an indebtedness
of the Town within the meaning of any constitutional or
statutory provision or limitation , shall not be consid-
ered or held to be a general obligation of the Town, and
is payable and collectible solely from the pledged net
income derived from the operation of the System. The
holder hereof may not look to the general fund or any
other municipal fund for the payment of the principal of
and interest on this bond, except the special funds
pledged therefor.
Payment of the 1976 Bonds and the interest
thereon shall be made solely from, and as security for
such payment there are pledged, pursuant to the Ordinance ,
two special funds identified as the "Town of Taos Joint
Water and Sewer Extension Revenue Bonds, Series 1976 In-
terest and Bond Retirement Fund" , and as the "Town of
Taos Joint Water and Sewer Extension Revenue Bonds, Series
1976 Reserve Fund" , into which the Town covenants to pay ,
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respectively, from the revenues derived from the opera-
tion of the System, after provision only for all neces-
sary and reasonable expenses of the operation and
maintenance of the System, and after and subject to the
payments required for the payment of principal of and
interest on the outstanding Town of Taos Joint Water
and Sewer Refunding Revenue Bonds, Series July 1, 1963
(the "1963 Bonds") and the outstanding Town of Taos Joint
Water and Sewer Extension Revenue Bonds , Series May 1,
1973 (the "1973 Bonds") , including specified reserves
therefor as required by Ordinances Nos. 528 and 621 ,
adopted and approved on July 1 , 1963 and May 1, 1973 , re-
spectively, sums sufficient to pay when due the principal
of and the interest on the 1976 Bonds and to create and
maintain a reasonable and specified reserve for such pur-
pose . For a description of said funds and the nature and
extent of the security afforded thereby for the payment
of the principal of and interest on the 1976 Bonds , refer-
ence is made to the Ordinance. The 1976 Bonds are equally
and ratably secured by a lien on the net revenues of the
System; and the 1976 Bonds constitute an irrevocable and
first lien (but not necessarily an exclusively first lien)
upon said net revenues subject and junior to the prior and
superior liens thereon of the 1963 Bonds and 1973 Bonds .
Bonds in addition to the 1976 Bonds, subject to desig-
nated conditions, may be issued and made payable from
the net revenues of the System and having a lien thereon
inferior and junior to the lien, or having a lien there-
on on a parity with the lie. , of the 1976 Bonds in ac-
cordance with the provisions of the Ordinance.
The Town covenants and agrees with the holder
of this bond and with each and every person who may be-
come the holder hereof that it will keep and perform all
of the covenants of the Ordinance, including, without
limiting the generality of the foregoing, its covenant
against the sale or mortgage of the System or any part
thereof unless provision shall be made for the payment
of the principal of and the interest on the 1976 Bonds
and its covenant that it will fix, maintain and collect
rates for services rendered by the System sufficient to
pay the annual operation and maintenance expenses and
one hundred twenty percent (120%) of both the principal
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of and interest on the 1976 Bonds and any other obliga-
tions, including, without limitation, the outstanding
1963 Bonds and the outstanding 1973 Bonds , payable an-
nually from the revenues of the System (excluding the
reserves therefor) .
This bond may be registered in the name of the
holder subject to the terms and conditions set forth in
the Ordinance and, unless so registered, this bond shall
be transferable by delivery. This bond may be register-
ed only as to both principal and interest. If this bond
is registered, it may be converted into a coupon bond
payable to bearer as provided in the Ordinance.
Subject to the provisions for registration,
this bond is subject to the conditions, and every holder
hereof by accepting the same agrees with the Town and
every subsequent holder hereof, that (a) delivery of this
bond to any transferee shall vest title in this bond and
in the interest coupons attached hereto in such trans-
feree to the same extent for all purposes as would the
delivery under like circumstances of any negotiable in-
strument payable to bearer ; (b) the Town and any agent
of the Town may treat the bearer of this bond as the ab-
solute owner hereof for all purposes, and shall not be
affected by any notice to the contrary; (c) the principal
of and thc_ interest on this bond shall be paid, and this
bond and each of the coupons appertaining hereto are
transferable, free from and without regard to any equities
between the Town and the original or any intermediate
holder hereof, or any setoffs or cross-claims ; and (d)
the surrender to the Town or any agent of the Town of this
bond and of each of the coupons shall be a good discharge
to the Town for the same .
It is certified , recited and warranted that all
the requirements of law have been fully complied with by
the proper Town officers in the issuance of this bond;
and that it is issued pursuant to and in strict conformity
with the Constitution and laws of the State of New Mexico,
and particularly under the terms and provisions of Sec-
tions 14-30-1 to 14-30-11 , inclusive, New Mexico Statutes
Annotated, 1953 Compilation, as amended, and all laws
thereunto enabling and supplemental thereto .
-15-
IN WITNESS WHEREOF, the Town has caused this
bond to be signed and authenticated in its name by the
facsimile signature of its Mayor and to be manually sign-
ed by its Treasurer; has caused the facsimile of the cor-
porate seal of the Town to be affixed hereon and to be
attested by the facsimile signature of its Clerk; and
has caused the coupons hereto annexed to be authenticated
with the facsimile signature of its Treasurer, all as of
the date of delivery hereof which is _, 197_.
TOWN OF T OS
By (Facsimile Signature)
Mayor
By (Manual Signature)
Town Treasurer
(FACSIMILE SEAL)
Attest:
(Facsimile Signature)
Town Clerk
(End of Form of Bond)
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J
(Form of Registration Panel on Back of Bond)
PROVISION FOR REGISTRATION AND CONVERSION
This bond may be registered only as to both
principal and interest on the books of the Town, kept
by the Town Treasurer as Registrar. Upon presentation
hereof, the Registrar shall detach and cancel all unma-
tured coupons and shall note such registration on such
books and in the registration blank below. After regis-
tration, this bond may be transferred by the registered
owner or his legal representative only upon a duly exe-
cuted assignment in form satisfactory to the Registrar,
such transfer to be made on said books and endorsed here-
on. The principal of and interest on this bond, if regis-
tered, shall be payable only to, or upon the order of ,
the registered owner or his legal representative.
This bond, if registered, may be converted into
a coupon bond, upon presentation to the Registrar , accom-
panied by an instrument duly executed by the registered
owners, or his legal representative, in form satisfactory
to the Registrar. In such case, the Registrar shall at-
tach new coupons representing the interest to become due
thereafter and shall note below that this bond is payable
to bearer. Such coupon bond may again be registered as
provided above.
Every privilege of registration , transfer, dis-
charge from registration or conversion shall be exercised
only in accordance with the authorizing ordinance and such
reasonable rules and regulations as the Registrar may
prescribe.
The registration books shall be closed for fif-
teen days prior to any interest payment date.
Tate of Name of Signature of
Registration Registered Owner Registrar
(End of Form of Registration Panel on Back of Bond)
-17-
(Form of Coupon)
Coupon
No. $
May
On November 1, , the Town of Taos , Taos
County, New Mexico, unless the bond to which this coupon
is attached, if callable, has been called for redemption
on a date which is prior to the maturity of this coupon,
upon surrender of this coupon will pay to bearer in law-
ful money of the United States of America, at the Office
of the Town Treasurer in Taos, New Mexico, or, if this
coupon is then owned or insured by the United States of
America, Farmers Home Administration (the "FmHA") , at the
FmHA's Finance Office located at 1520 Market Street, St.
Louis, Missouri 63103 , or at such other place as the
FmHA may designate in writing, the amount herein desig-
nated solely from and secured by a pledge of special
funds, such amount being interest on its Town of Taos
Joint Water and Sewer Extension Revenue Bond, Series 1976
and bearing
Bond
No.
(Facsimile Signature)
Treasurer
(End of Form of Coupon)
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Section 9. Use of 1976 Single Bond. Notwith-
standing the foregoing provisions hereof, an aggregate
amount of money not exceeding $500,000 borrowed from
the F;nHA may be evidenced by a non-negotiable 1976 sin-
gle Bond in the principal amount and denomination of:
$500, 000 (or such lesser amounts loaned to the Town by
the FmHA) , numbered R-1 , which single Bond shall be exe-
cuted in the name of and on behalf of the Town by the
signature of its Mayor, authenticated by the TreasuE:r,
with the seal of the Town affixed thereto and attested
by the Town Clerk. The 1976 single Bond shall not bear
interest coupons and shall be payable in lawful money of
the United ,States of America , without deduction for ex-
change or collection charges , during the time the FmHA
is the registered owner or insurer of such Bond, at the
Finance Office of the FmHA located at 1520 Market Street,
St. Louis, Missouri 63103 , or at such her address as
the FmHA may designate in writing and so payable during
the time as any registered assign is the registered owner
of such Bond at the address shown on the registration
book of the Town. The 1976 single Bond shall mature in
installments of principal , bear interest and be subject
to prepayments of installments of principal , substantially
as provides: in Section 5 hereof. The 1976 single Bond
may be registered by any hold,-r and may be assigned in
the manner and with the effect set forth in the provisions
for registration contained in the form thereof hereinafter
set forth and as herein further provided. Upon issuance
to the FmHA, the 1976 single Bond shall be registered in
the name of the "United States of America, Farmers Home
Administration" . Upon request of the holder of the 1976
single Bond, the Town shall issue, at the holder ' s expense
and within ninety days from the date of such request, ne-
gotiable, bearer, coupon 1976 Bonds or serial registered
1976 Bond without coupons , in the denomination of $1 , 000
each, to the extent practicable, as requested by the hold-
er, in an aggregate principal amount equal to the amount
of the unpaid principal of the outstanding 1976 single
Bond of like tenor and date , in the form prescribes( by,
and subject to, the provisions of this ordinance.
Section 10. Form of the 1976 Single Bond. The
1976 single Bond, the form of assignment therefor and the
advance and payment records to be attached thereto, shall
be in substantially the following form:
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(Form of Single Bond)
UNITED STATES OF AMERICA
STATE OF NEW MEXICO COUNTY OF TAOS
TOWN OF TAOS
SINGLE REGISTERED JOINT WATER AND SEWER
EXTENSION REVENUE BOND
SERIES 1976
i
No. R-1 $500 , 000
t
The Town of Taos (the "Town" ) , Taos County,
New Mexico, for value received hereby promises to pay
to the registered owner hereof, solely from the special
funds provided therefor, the principal sum above stated
or such lesser sum as shall represent the aggregate ad-
vances made to the Town by the Farmers Home Administra-
tion (the "FmHA" ) of the United States Department of
Agriculture as set forth in the schedule on the reverse
side hereof, on November 1 , in the years and installments
as follows:
Amounts Years
Maturing Maturing
$ 51000 1978
5 , 000 1979
5 , 000 1980
5 , 000 1981
5 , 000 1982
5, 000 1983
5 , 000 1984
5 ,, 000 1985
10 , 000 1986
10,000 1987
10, 000 1988
30, 000 1989
30 , 000 1990
30, 000 1991
30 , 000 1992
30, 000 1993
40, 000 1994
40,000 1995
40,000 1996
40,000 1997
40 , 000 1998
40 , 000 1999
40, 000 2000
with interest on the unpaid principal advanced to the
Town from the date of each such advance at the rate of
5% per annum payable semiannually on May 1 and November 1 of
each year until said sum is paid, commencing on November 1 ,
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1976. If upon presentation at maturity, payment of this
bond is not made as herein provided, interest shall con-
tinue at the above rate until the principal hereof is
paid in full. Principal and interest are payable in law-
ful money of the United States of America, without deduc-
tion for exchange or collection charges, during the
period the FmHA is the registered owner or insurer of this
1976 single Bond, at the Finance Office of the FmHA. lo-
cated at 1520 Market Street, St. Louis , Missouri 63103 ,
or at such other place as the FmHA may designate in writ-
ing and are so payable during any period the FmHA is not
the registered owner or insurer hereof at the address
shown on the registration book of the Town. The final in-
stallment of principal and interest due on this 1976 sin-
gle Bond is payable only upon the Bond ' s surrender to the
Town.
This bond is authorized for the purpose of pay-
ing the costs of extending, enlarging, bettering and other-
wise improving the municipal joint water and sewer system.
Installments of principal becoming due on and
before November 1, 1985 are not payable prior to their:
stated due dates unless the FmHA is the registered owner
hereof. If the FmHA is the registered owner hereof , all
installments are subject to unlimited prepayment on any
interest payment date prior to their stated due dates if
redeemed in the amount of $1 , 000 or multiples thereof ,
and, in inverse order of maturity, by the payment of such
principal amount and accrued interest to the prepayment
date. Installments becoming due on and after November 1,
1986, are subject to prepayment prior to their stated due
dates in the amount of $1, 000 or multiples thereof , at
the option of the Town, in inverse order of maturity, on
November 1 , 1985 or on any interest payment date there-
after, by the payment of the principal amount and accrued
interest to the prepayment date. The Town also reserves
the right, at its option, to prepay installments of prin-
cipal on any interest payment date in inverse order of
maturity in the amount of $1 , 000 or multiples thereof and
accrued interest to the prepayment date from excess bond
proceeds. Prepayment shall be made upon notice given as
provided in Ordinance No. adopted and approved on
, 1976, authorizing the issuance of this
Bond (the "Ordinance") .
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R
Payment of this 1976 single Bond and interest
thereon shall be made solely from, and as security for
such payment there are pledged, pursuant to the Ordi-
nance, two special funds identified as the "Town of Taos
Joint Water and Sewer Extension Revenue Bonds, Series
1976 Interest and Bond Retirement Fund" and the "Town of
Taos Joint Water and Sewer Extension Revenue Bonds,
Series 1976 Reserve Fund" into which the Town covenants
to pay, respectively, from the revenues of its joint
water and sewer system (the "System") , after provision
only for all necessary and reasonable operation and main-
tenance expenses and after and subject to the payments
required for the payment of principal of and interest on
the outstanding Town of Taos Joint Water and Sewer Re-
funding Revenue Bonds, Series July 1 , 1963 (the "1963
Bonds" ) and the outstanding Town of Taos Joint Water and
Sewer Extension Revenue Bonds, Series May 1 , 1973 (the
"1973 Bonds" ) , including specified reserves therefor, as
required by Ordinances Nos . 528 and 621 , adopted and ap-
proved on July 1 , 1963 and May 1 , 1973 , respectively,
sums sufficient to pay the principal and the interest on
this bond and to create and maintain a reasonable and
specified reserve for such purpose. For a description
of said funds and the nature and extent of the security
afforded thereby , reference is made to the Ordinance.
This 1976 single Bond is secured by and constitutes an
irrevocable and first lien (but not necessarily an ex-
clusively first lien) upon the net revenues of the System
subject and junior to the prior and superior liens there-
on of the 1963 Bonds and 1973 Bonds . Subject to desig-
nated conditions, additional. bonds may be issued payable
from said net revenues and having a lien thereon inferior
and junior to the lien, or having a lien thereon on a
parity with the lien of this 1976 single Bond in accord-
ance with the provisions of the Ordinance.
The Town covenants and agrees with the holder
hereof that it will keep and perform all the covenants of
the Ordinance, including, without limiting the generality
of the foregoing, its covenant against the sale or mort-
gage of the System or any part thereof unless provision
has been made for the payment of the principal of and in-
terest on this 1976 single Bond and its covenant that it
will fix, maintain and collect rates for services rendered
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by the System sufficient to pay the annual operation and
maintenance expenses and one hundred twenty percent (120%)
of both the principal of and the interest on this 1976
single Bond and any other obligations , including without
limitation the outstanding 1963 Bonds and the outstanding
1973 Bonds, payable annually from the revenues of the
System (excluding the reserves therefor) .
This Bond does not constitute an indebtedness
or a debt of the Town within the meaning of any constitu-
tional or statutory provision or limitation, shall not be
considered or held to be a general obligation of the Town
and is payable and collectible solely from the pledged
net income derived from the operation of the System. The
holder hereof may not look to the general fund or any
other municipal fund for the payment of the principal of
and interest on this Bond, except the special funds
pledged therefor.
This Bond is transferable only upon books kept
by the Treasurer of the Town as bond registrar by the
registered owner hereof in person or by his duly author-
ized attorney , and similarly noted hereon, or it may be
surrendered in exchange for new bonds of the same series,
same aggregate principal amount, in coupon form or in
serial registered form, in the denomination of $1 ,000
each, to the extent practicable and consistent with the
maturity schedule provided in, and subject to, the condi-
tions set forth in the Ordinance.
This 1976 single Bond is issued against payment
for the bond purchase price of par, but said purchase
price may be paid to the Town in one or more advances in
accordance with the schedule on the reverse side hereof.
The principal amount of this Bond shall not exceed the
actual advances paid to the Town and interest shall ac-
crue on the amount of each advance only from the date
each advance is paid . In the event the entire principal
amount of this 1976 single Bond is not advanced , the
principal installments set forth above shall be reduced
in inverse order of maturity accordingly.
it is certified, recited and warranted that all
the requirements of law have been fully complied with by
the proper Town officers in the issuance of this Bond;
and that it is issued pursuant to and in strict conformity
-23-
with the Constitution and laws of the State of New
Mexico and particularly under the terms and provisions
of Sections 14-30-1 to 14-30-11, inclusive, New Mexico
Statutes Annotated, 1953 Compilation, as amended, and
all laws thereunto enabling and supplemental thereto.
IN WITNESS WHEREOF, the Town has caused this
Bond to be signed and executed in its name by the Mayor
of the Town, to be signed by the Town Treasurer, has
caused the seal of the Town to be affixed hereto, and
to be attested by the Town Clerk, all as of the date of
the delivery hereof which is 197 .
TOWN OF T OS
By (Manual Signature)
Mayor {
S
By (Manual Signature)
Town Treasurer
(SEAL)
s
Attest:
(Manual Signature)
Town Clerk
(End of Form of Single Bond)
5
i
{
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(Form of Installment Loan Panel on Back of Single Bond)
INSTALLMENT LOAN ADVANCES BY GOVERNMENT
The FmHA on behalf of the United States of
America loaned to the Towli the respective amounts of
principal on the respective dates hereinafter designated,
the sum of which amounts constitutes the aggregate princi-
pal amount of the within 1976 single Bond, as follows :
Date of Amount of Signature of
Loan Loan Town' s Treasurer
(End of Form of Installment Loan Panel)
(Form of Registration Panel on Back of Single Bond)
MANDATORY REGISTRATION FOR PAYMENT AS TO
PRINCIPAL AND INTEREST
The within 1976 single Bond is registered in
the Office of the Treasurer of the Town of Taos, Taos
County, New Mexico, as Registrar, in the name of the last
owner listed below; and the principal amount of the Bond
and interest thereon shall be payable only to such owner ,
all in accordance with the ordinance authorizing the
Bond' s issuance.
Date of Address of Signature of
Registration Name of Owner Owner Registrar
United States of Finance Office
America, Farmers 1520 Market St.
Home Administra- St. Louis, MO
tion 63103
(End of Form of Registration Panel)
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(Form of Assignment Panel on Back of Single Bond)
ASSIGNMENT PROVISION
For Valu.! Received,
hereby assign and transfer unto
the within bond, together with accrued interest thereon,
hereby irrevocably constituting and appointing
attorney to transfer this
bond on the books of the Town of Taos at the Office of
the Treasurer of the Town with full power of substitution
in the premises.
Dated:
(End of Form of Assignment Panel)
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Section 11. Period of Project' s Usefulness .
The period of usefulness of the facilities to be ac-
quired with the proceeds of the 1976 Bonds is not less
than twenty-five years from the date of the 1976 Bonds .
Section 12. Disposition of 1976 Bond Proceeds.
A. 1976 Construction Fund. The proceeds
derived from the sale of 1976 Bonds shall be deposited
promptly upon the receipt thereof in a "supervised bank
account" in an Insured Bank selected by the FmHA, which
account shall be known as the "Town of Taos Joint Water
and Sewer Extension Revenue Bonds, Series 1976 Construc-
tion Fund" (the "1976 Construction Fund") . Amounts in
the account exceeding the applicable federal deposit in-
surance coverage shall be secured by such bank in advance
in accordance with U. S. Treasury rules and regulations
governing the deposit of government moneys. Moneys in
the account shall be used solely for the Project and
shall be withdrawn and signed by the Mayor and the Treas-
urer, and countersigned by the County Supervisor or other
FmHA official. Warrants or checks payable to the con-
tractor shall not be issued until the Board has received
approval of the Consulting Engineer that such sum is due
and owing. The Town ' s share of any liquidated damages
and other moneys paid by defaulting contractors or their
sureties shall be deposited in the 1976 Construction Fund
to insure completion of the Project. After the Consult-
ing Engineer has certified that work is completed and
that all expenses have been paid , the bank shall transfer
all remaining money to the 1976 Bond Fund to be used to
the extent possible for redeeming 1976 Bonds or install-
ments of principal in accordance with this Ordinance.
B. Purchasers Not Responsible. The pur-
chasers of the 1976 Bonds shall not be responsible for
the application or disposLtl of the funds derived from the
sale of the 1976 Bonds.
Section 13 . Fiscal Year. For the purposes of
this Ordinance, the System shall be operated upon a fis-
cal year which the Board or other appropriate authority
heretofore has established or hereafter may establish as
the fiscal year for the System.
Section 14 . Income Fund. So long as any of
the 1976 Bonds shall be outstanding, either as to principal
-27-
or interest, or both, the entire gross income and reve-
nues of the System shall continue to be deposited into
the "Tr,wn of Taos Joint Water and Sewer System Gross In-
come Fu - T' , created by Section 14 of Ordinance No. 528
(the "Income Fund") .
Section 15. Administration of Income Fund .
So long as any of the 1976 Bonds shall be outstanding,
either as to principal or interest, or both, the follow-
ing payments shall be made from the Income Fund:
A. 9 eration and Maintenance Expenses.
Firstly, as a first charge thereon, there shall continue
1;o be set aside from time to time as the "Town of Taos
Joint Water and Sewer Operation and Maintenance Fund"
established by Section 15A of Ordinance No. 528 (the
"Operation and Maintenance Fund") , moneys in the Income
Fund sufficient to pay operation and maintenance ex-
penses as they become due and payable, and thereupon
they shall be promptly paid. Any surplus remaining at
the end of the fiscal year and not needed for operation
and maintenance purposes shall be transferred to the In-
come Fund and be used for the purpose thereof , as herein
provided.
B. Bond and Reserve Funds .for 1963 Bonds.
Secondly, and subject to the aforesaid provisions , from
any moneys remaining in the Income Fund, i . e . , from the
net income of the System, there shall continue to be
credited to the Bond and Reserve Funds for the 1963
Bonds the monthly payments required by paragraphs B and
C of Section 15 of Ord. No. 528 (relating to the Bond
and Reserve Funds for the 1963 Bonds) as qualified and
supplemented by the remainder of said Section 15 .
C. Bond and Reserve Funds for 1973 Bonds.
Thirdly, and subject to the aforesaid provisions, from
any moneys remaining in the Income Fund, i. e. , from the
net income of the System, there shall continue to be
credited to the Bond and Reserve Funds for the 1973
Bonds the monthly payments required by paragraph C of
Section 16 of Ord. No. 622 (relating to the Bond and
Reserve Funds for the 1973 Bonds) as qualified and supple-
mented by the remainder of said Section 16 .
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D. Bond and Reserve Funds for 1976 Bonds.
(1) 1976 Bond Fund. Fourthly, but
subject and junior to the foregoing monthly payments,
there shall be credited to an account hereby created and
to be known as the "Town of Taos Joint Water and Sewer
Extension Revenue Bonds, Series 1976 , Interest and Bond
Retirement Fund" (herein sometimes referred to as the
"1976 Bond Fund" or as the "Bond Fund") , the following:
(a) Monthly, commencing on the
first day of the month immediately succeeding the deliv-
ery of any of the 1976. Bonds an amount in equal monthly
installments necessary, together with any moneys therein
and available therefor, to pay the first maturing install-
ment of interest on the 1976 Bonds then outstanding, and
monthly thereafter commencing on said interest payment
date one-sixth of the amount necessary to pay the next
maturing installment of interest on the outstanding 1976
Bonds.
(b) Monthly, commencing on the
first day of November, 1977, an amount in equal monthly
installments necessary, together with any moneys therein
and available therefor, to pay the first maturing install-
ment of principal of the outstanding 1976 Bonds, and
monthly thereafter commencing on said principal payment
date one-twelfth of the amount necessary to pay the next
maturing installment of principal on the 1976 Bonds.
(2) 1976 Reserve Fund. Fifthly, con-
currently with the monthly payments heretofore required
by this paragraph D and subject and junior to the monthly
payments required to be paid by paragraphs A, B and C of
this section, and except as provided in paragraphs E and
F of this section, from any moneys remaining in the Income
Fund there shall be set aside and credited monthly at
least $333 . 33 per month into a fund hereby created and to
be known as the "Town of Taos Joint Water and Sewer Exten-
sion Bonds, Series 1976 Reserve Fund" (herein sometimes
designated as the "1976 Reserve Fund" or "Reserve Fund" )
until a reserve has been accumulated in an amount equal to
not less than $40 , 000 (herein sometimes designated as the
"Minimum 1976 Reserve" or "Minimum Reserve" ) . Such payments
shall commence on the first day of the month succeeding the
delivery of any of the 1976 Bonds. After accumulation of
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the Minimum Reserve, there shall be deposited monthly
from any moneys remaining in the Income Fund, into the
1976 Reserve Fund such amount or amounts as are neces-
sary to maintain the 1976 Reserve Fund as a continuing
reserve in an amount not less than the then Minimum
1976 Reserve to meet possible deficiencies in the 1976
Bond Fund. No payment need be made into the 1976 Reserve
Fund so long as the moneys therein shall equal not less
than the Minimum Reserve. The moneys in the 1976 Reserve
Fund shall be accumulated and maintained as a continuing
reserve to be used, except as hereinafter provided in
paragraphs E and F of this section, only to prevent de-
ficiencies in the payment of the principal of and inter-
est on the bonds hereby authorized resulting from the
failure to deposit into the Bond Fund sufficient funds
to pay said principal and interest as the same accrue.
E. Termination Upon Deposits to Maturity.
No payment need be made into the 1976 Bond Fund, the 1976
Reserve Fund, or both, if the amount in the 1976 Dond Fund
and the amount in the 1976 Reserve Fund to,--al a sum at
least equal to the entire amount of the outstanding bonds
herein authorized, ' - to principal and interest to
their respective maturities, and both accrued and not ac-
crued, in which case moneys in said two funds in an amount
at least equal to such principal and interest requirements
shall be used solely to pay such as the same accrue, and
any moneys in excess thereof in said two funds and any
other moneys derived from the operation of the system may
be used in any lawful manner determined by the Governing
Body.
F. Defraying Delinquencies in 1976 Bond
an,,, Reserve Funds. If, in any month, the Town shall , for
any reason, fail to pay into the 1976 Bonu Fund the full
amount above stipulated from the net income of the System,
then an amount shall be paid into said Bond Fund in such
month from the 1976 Reserve Fund equal to the difference
between that paid from said net income and the full amount
so stipulated. The money so used shall be replaced in
the Reserve Fund from the first revenues thereafter re-
ceived from the operation of the System not required to
be otherwise applied . If, in any month, the Town shall,
for any reason, fail to pay into the 1976 Reserve Fund
the full --mount above stipulated from the net income of
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said System, the difference between the amount paid and
the amount so stipulated shall in a like manner be paid
therein from the first revenues thereafter received from
the operation of the System not required to be otherwise
applied. The moneys in the 1976 Bond Fund and the 1976
Reserve Fund shall be used solely and only for the pur-
poses of paying the principal of and the interest on the
1976 Bonds; provided, however, that any moneys at the
time in excess of the Minimum Reserve in the 1976 Reserve
Fund may be withdrawn therefrom and used as herein pro-
vided for the redemption of bonds hereby authorized as
they become due or on any redemption date; and provided
that any moneys in the 1976 Bond Fund and the 1976 Re-
serve Fund in excess of accrued and unaccrued principal
and interest requirements to the respective maturities
of the outstanding bonds may be used as hereinabove pro-
vided in paragraph E of this section.
G. Payment for Additional Obligations .
Sixly, from any balance remaining in the Income Fund af-
ter making the payments hereinabove provided, there shall
be paid the interest on and the principal of additional
bonds or other obligations, if any, hereafter authorized
to be issued and payable from the revenues of the System,
including reasonable reserves therefor, as the same accrue;
provided, that the lien of such additional bonds and other
obligations on the net income and revenues of the System
and the pledge thereof for the payment of such additional
obligations shall be on a parity with, or subordinate to,
the .lien and pledge of the bonds herein authorized , as
hereinafter provided. In the event such additional bonds
or other obligations be on a parity with the bonds herein
authorized, the payment of interest on, principal of and
reserve for such additional bonds or other obligations
shall be made concurrently with the payments required by
paragraph D of this section.
H. Use of Surplus Revenues. After making
the payments hereinabove required to be made by paragraphs
A to , Both inclusive, of this section, the remaining in-
come aro revenues derived from the operation of the System,
if any, may be applied to any other purpose or purposes
authorized by the Constitution and the laws of the State,
as the Governing Body may direct.
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Section 16. General Administration of Funds.
The funds and accounts created in Sections 12 and 15
hereof shall be administered as follows :
A. Places and Times of Deposits. Each
of the above accounts and funds shall be separately main-
tained and kept separate from all other funds and accounts
as a trust fund for the purposes established and shall be
deposited in one or more bank accounts in an Insured Balik
or Banks. Each account shall be continuously secured to
the extent required by law and shall be irrevocable and
not withdrawable by anyone for any other purpose. The
1976 Construction Fund and Reserve Fund must be estab-
lished and maintained as bank accounts separate from all
others. Payments shall be made into the proper account
on the first day of the month, except when the first day
shall be a Sunday or legal holiday, in which case payment
shall be made on the next succeeding secular day. At
least five days prior to any interest payment date, moneys
sufficient to pay interest and principal then due shall be
credited at the Paying Agent.
B. 1976 Bonds Not Arbitrage Bonds. The
Town hereby covenants for the benefit of each holder of the
1976 Bonds that the Town will make no use of the proceeds
of the 1976 Bonds which will cause the 1976 Bonds to be
arbitrage bonds as defined by Section 103 (d) of the Internal
Revenue Code of 1954 , as amended, or which would result in
the loss of tax exemption from federal income taxation of the
interest on the 1976 Bonds .
C. Investment of Money. Any moneys in any
fund created hereby may be invested in any legal investment
permitted by law. The obligations purchased as an invest-
ment of moneys in such fund shall be deemed at all times to
be part of such fund, and the interest accruing thereon and
any profit realized therefrom shall be credited to the fund,
and any loss resulting from such investment shall be charged
to the fund. The Town Treasurer shall present for redemp-
tion or sale on the prevailing market any obligations pur-
chased as an investment of moneys in the fund whenever it
shall be necessary to do so in order to provide moneys to
meet any payment or transfer from such fund.
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Section 17. First Lien Bonds. The 1976 Bonds
constitute an irrevocable and first lien (but not neces-
sarily an exclusively first lien) upon the gross revenues
derived from the operation of the System subject to the
payment of all necessary and reasonable operation and
:maintenance expenses of the System and subject and junior
to the prior and superior liens thereon of the 1963 Bonds
and the 1973 Bonds.
Section 18 . Equality of 1976 Bonds. The 1976
Bonds shall not be entitled to any priority one over the
other in the application of the net revenues, regardless
of the time or times of their issuance.
Section 19 . Additional Bonds.
A. Earnings Test. Nothing in this ordi-
nance contained shall be construed to prevent the issuance
by the Town of additional bonds or other obligations pay-
able from the income or revenues derived from the opera-
tion of the System and constituting a lien upon said reve-
nues on a parity with, but not prior or superior to the
lien of the 1976 Bonds , nor to prevent the issuance of
bonds or other obligations refunding all or a part of the
1976 Bonds , provided, however, that before any such addi-
tional parity bonds or other parity obligations are au-
thorized or actually issued, including the 1976 Bonds ,
and also including any parity refunding obligations (other
than those refunding subordinate bonds or other subordinate
obligations as permitted in Section 20 hereof) :
(1) The Town is not, and has not been
in default as to making any payments re-7uired by Section
15 hereof during the twelve months immediately preceding
the issuance of such additional bonds or other obligations,
or if none of the 1976 Bonds have been issued and outstand-
ing for a period of at least twelve months, then for the
longest period of time any of such Bonds have been issued
and outstanding; and
(2) The net revenues derived from the
operation of the System for the fiscal year immediately
preceding the date of issuance of such additional parity
obligations shall have been sufficient to pay an amount
representing one hundred twenty percent (120%) of the com-
bined average annual principal and interest requirements
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of the outstanding revenue bonds and other obligations
of the Town payable from and constituting a lien upon the
revenues of the System and the bonds or other obligations
proposed to be issued (excluding any reserves therefor) .
As used in this section, "combined average annual princi-
pal and interest requirements" shall be the total princi-
pal and interest coming due on the then outstanding and
proposed parity lien obligations during the period extend-
ing from the date of the proposed parity lien obligations
to the final principal payment date of the then outstand-
ing 1976 Bonds divided by the number of years (including
any fraction thereof) computed from the date of the pro-
posed parity lien obligations to the last principal pay-
ment date of the then outstanding 1976 Bonds.
The foregoing limitations on the issuance
of parity bonds shall not apply in the case of the issu-
ance of additional parity bonds necessary to complete the
Project in a-cordance with the original plans and specifi-
cations therefor.
B. Certification or Opinion of Earnings .
A written certification or opinion by an Independent
Accountant that said revenues for the fiscal year immedi-
ately preceding the date of issuance of the new obliga-
tions are sufficient to pay said amounts when adjusted as
hereinafter provided, shall be conclusively presumed to
be accurate in determining the right of the Town to au-
thorize, issue, sell and deliver said additional bonds or
other obligations on a parity with the 1976 Bonds.
C. Consideration of Additional Expenses .
In determining whether or not additional parity bonds or
other parity obligations may be issued as aforesaid , con-
sideration shall be given to any probable increase (but
not reduction) in operation and maintenance expenses that
will result from the expenditure of funds proposed to be
derived from the issuance and sale of the said bonds or
other obligations.
D. Junior Obligations Permitted. Nothing
herein contained shall be construed to prevent the Town
from issuing bonds or other obligations payable from the
revenues of the System and having a lien thereon subordi-
nate, inferior and junior to the lien of the 1976 Bonds .
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E. Superior Obligations Prohibited.
Nothing herein contained shall be construed to permit
the Town to issue bonds or other obligations payable
from the revenues of the System and having a lien there-
on prior and superior to the lien of the 1976 Bonds .
Section 20 . Refunding Bonds. The provisions
of Section 19 hereof are subject the following
exceptions:
A. Privilege of Issuing Refunding
Obligations. If at any time after the 1976 Bonds or any
part thereof shall have been issued and remain outstand-
ing, the Board shall find it desirable to refund any
outstanding bonds or other outstanding obligations pay-
able from any revenues of the System, said bonds or other
obligations, or any part thereof, may be refunded (but
only with the consent of the holder or holders thereof,
unless the bonds or other obligations, at the time of
their required surrender for payment, shall then mature,
or shall then be callable for prior redemption at the
Town Isoption) , regardless of whether the priority of the
lien for the payment of the refunding obligations on the
revenues of the System is changed (except as provided in
paragraph E of Section 19 hereof and in paragraphs B and
C of this Section 20) .
B. Limitations Upon Issuance of Parity
Refunding Obligations. No refunding bonds or other re-
funding obligations payable from any revenues of the
System shall be issued on a parity with the 1976 Bonds,
unless:
(1) The lien on any revenues of the
System of the outstanding obligations refunded is on a
parity with the lien thereon of the 1976 Bonds; or
(2) The refunding bonds or other
refunding obligations are issued in compliance with para-
graph A of Section 19 hereof.
C. Refunding Part of an Issue. The re-
funding bonds or other obligations issued shall enjoy
complete equality of lien with the portion of any bonds
or other obligations of the same issue which is not re-
funded, if any; and the holder or holders of such refund-
ing bonds or such other refunding obligations shall be
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subrogated to all of the rights and privileges enjoyed
by the holder or holders of the bonds or other obliga-
tions of the same issue refunded thereby.
D. Limitations upon Issuance of any Re-
funding Obligations. Any refunding bonds or other refund-
ing obligations payable from any revenues of the System
shall be issued with such details as the Board may by
ordinance provide, subject to the inclusion of any such
rights and privileges designated in paragraph C of this
Section 20, but without any impairment of any contractual
obligation imposed upon the Town by any proceedings au-
thorizing the issuance of any unrefunded portion of such
outstanding obligations of any one or more issues (in-
cluding, but not necessarily limited to the 1976 Bonds) .
If only a part of the outstanding bonds and any other
outstanding obligations of any issue or issues payable
from the revenues of the System is refunded, then such
obligations may not be refunded without the consent of
the holder or holders of the unrefunded portion of such
obligations, unless:
(1) The refunding bonds or other re-
funding obligations do not increase any aggregate annual
principal and interest requirements evidenced by such re-
funding obligations and by the outstanding obligations
not refunded on and prior to the last maturity date of
such unrefunded obligations, or
(2) The lien on revenues of the
System for the payment of the refunding obligations is
subordinate to each such lien for the payment of any ob-
ligations not refunded, or
(3) The refunding bonds or other
refunding obligations are issued in compliance with para-
graph A of Section 19 hereof.
Section 21. Protective Covenants. The Town
hereby covenants and agrees with each and every holder of
the 1976 Bonds:
A. Use of Bond Proceeds. The Town will
proceed, without delay, to acquire the Project, as herein
provided.
B. Payment of 1976 Bonds. The Town will
promptly pay the principal of and the interest on every
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1976 Bond at the place, on the dates and in the manner
specified herein and in the 1976 Bonds and in the cou-
pons (if any) thereto appertaining according to the true
intent and meaning hereof.
C. Use Charges. While any of the 1976
Bonds remain outstanding and unpaid, the rates for all
services rendered by the System shall be reasonable and
just, taking into account the cost and value of the Sys-
tem, proper and necessary allowances for the deprecia-
tion thereof and the amounts necessary for the retirement
of all bonds and other obligations payable from the
revenues of the System, the accruing interest thereon and
reserves therefor. There shall be charged against all
users of service such rates and amounts as shall be ade-
quate to meet the requirements of this and the preceding
sections hereof , and which shall be sufficient to produce
revenues annually to pay the annual operation and main-
tenance expenses, and one hundred twenty percent (120%)
of both the principal of and interest on 1976 Bonds and
any other obligations payable annually from the revenues
thereof, excluding the reserves therefor, all of which
reserves shall be subject to distribution for the payment
of the costs of operating and maintaining the System and
the payment of principal of and interest on all obliga-
tions payable from the revenues of the System, including
reasonable reserves therefor. No free service , facili-
ties or commodities shall be furnished by the System.
All the income so derived from the Town shall be deemed
to be income derived from the operation of the System, to
be uFed and accounted for in the same manner as any other
income derived from the operation of the System.
D. Levy of Charges. The Town will fix ,
establish and levy the rates and charges which are re-
quired by paragraph C of this Section 21. No reduction
in any initial or existing rate schedule for the System
may be made unless:
(1) The Town has fully complied with
the provisions of Sections 14 and 15 hereof for at least
the full fiscal year immediately preceding such reduction;
and
(2) The audit required by the In-
dependent Accountant by paragraph H of this section for
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the full fiscal year immediately preceding such reduction
discloses that the estimated revenues resulting from the
proposed rate schedule will be sufficient to meet the re-
quirements of paragraph C of this section; and
(3) If any of the bonds are then
owned by the FmHA, the State Director of the FmHA ap-
proves in writing the proposed reduction pro--lded that
he shall have first been furnished with a written request
signed by the Mayor of the Town requesting and justifying
such reduction; provided further, however, that no such
approval shall be required if the refusal of the State
Director of the FmHA to give such approval would violate
the Town' - covenants under Ordinances Nos. 528 or 621.
E. Efficient Operation. The Town will
operate the System so long as any of the 1976 Bonds are
outstanding, will maintain the System in efficient operat-
ing condition and will make such improvements, extensions ,
enlargements, repairs and betterments thereto as may be
necessary or advisable to insure its economical and ef-
ficient operation.
F. Records. Separate records will be kept
showing complete and correct entries of all transactions
relating to the System. Such records shall include month-
ly entries showing:
(1) The number of customers;
(2) The revenues received from
charges to customers.
(3) A detailed statement of expenses ;
and
(4) Such other items specified by any
form furnished by the FmHA.
Before each fiscal year, the Board will
cause an operating budgcst to be prepared.
G. Right to Inspect . The FmHA, any holder
or their duly authorized agents shall have the right at
all reasonable times to inspect the System and all records,
accounts and data relating thereto.
H. Audits. Within twenty days following
the close of each fiscal year, the Town will furnish an
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audit of such books and accounts made by an Independent
Accountant showing the receipts and disbursements for
the account of the System to the FmHA. Each such audit,
in addition to whatever matters may be thought proper by
the accountant, shall include:
(1) A balance sheet as of the end
of such fiscal year, including all funds created by the
various proceedi:gs authorizing the issuance of outstand-
ing obligations payable from the revenues of the System.
(2) A statement for the fiscal year
just closed of the income and expenditures of the System,
including gross revenues , net revenues, the amount of
any capital expenditures and profit or loss.
(3) The accountant' s comment regard-
ing the manner in which the Town has carried out the re-
quirements of this ordinance and any other proceedings
authorizing the issuance of outstanding obligations pay-
able from the revenues of the System and the accountant ' s
recommendation for any change or improvement in the opera-
tion of the System.
(4) A list of the insurance policies
in force setting out as to each policy the amount of the
policy, the risks covered , the name of the insurer and
the expiration date.
(5) A re.:apitulation of each fund or
account created by the various proceedings authorizing
the issuance of outstanding obligations payable from the
revenues of the System, showing the balance in such fund
at the beginning of the fiscal year, the deposits and
withdrawals during said year, and the balance at the end
of said year.
(6) The number of metered water con-
nections and unmetered water connections at the beginning
and at the end of the fiscal year.
(7) The number of customers per class
of customers and revenues per class of customers , includ-
ing but not necessarily limited to classification by
water farA*.lities and sewer facilities , and the total
water consumption in detail, including but not limited to
domestic consumption, water used for fires and flushing
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mains, and water consumed or lost and unaccounted for,
and total sewage treatment by classes of customers.
Along with the audit, the Town will fur-
nish the following:
(1) An operating budget showing the
planned budget for the ensuing year.
(2) A copy of the minutes of the
meeting of the Board at which such budget was approved.
(3) A written instrument containing
the name, address and term of office for the Mayor, Town
Clerk and each member of the Board and the number of resi-
dential users and the number of commercial users of the
System.
(4) Quarterly reports of income and
expenses on forms furnished by the FmHA.
(5) A financial statement on a form
furnished by the FmHA.
The Town will furnish a copy of each audit ,
budget, minutes, written instrument, quarterly report and
financial statement to any holder at his request and with-
out request to the FmHA. Any holder shall have the right
to discuss the contents with any person making the audit.
The Town shall publish a summary of each annual audit at
least once within three months after expiration of the
fiscal year in a newspaper published in the English lan-
guage and of general circulation in the Town.
All expenses incurred in preparing the au-
dits and other documents by this section shall be consid-
ered and paid as an operation and maintenance expense.
I . Billing Procedures . All bills for
water and water service or facilities and sewer service
or facilities furnished or served by or through the Sys-
tem shall be sent to customers on a regularly established
day of each and every month either monthly in advance or
in the month next succeed-Lng the month in which the ser-
vice was rendered and shall be due within twenty days from
the date sent. In the event the bills are not paid within
forty days after the date when sent, water and water ser-
vice shall be dis:ontinued, and the rates and charges due
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shall be collected in a lawful manner, including but not
limited to the cost of disconnection and reconnection.
Water charges and sewer charges may be billed jointly
with each other or separately, and each such joint bill
shall show separately water and sewer charges.
J. Use of 1976 Bond Fund and 1976 Reserve
Fund. The 1976 Bond Fund and the 1976 Reserve Fund shall
be used solely and only, and said funds are hereby pledged
for the purposes set forth in this ordinance.
K. Charges and Liens upon System. From
the revenues of the System the Town will pay all taxes
and assessments or other municipal or governmental charges
lawfully levied, assessed upon or in respect to the System,
or any part thereof , when due. It will duly observe and
comply with all valid requirements of any municipal or
governmental authority relative to any part of the System.
The Town will not create or suffer to be created any lien
or charge upon the System or upon the revenues therefrom
except as permitted by this ordinance, or it will make
adequate provision to satisfy and discharge within sixty
days after the same shall accrue, all lawful claims and
demands for labor, materials, supplies or other objects ,
which, if unpaid, might become a lien upon the System or
upon the revenues therefrom; provided, however, that
nothing herein shall require the Town to pay or cause to
be discharged any such tax, assessment, lien or charge be-
fore the payment shall be due or so long as the validity
thereof shall be contested in good faith by appropriate
legal proceedings.
L. Insurance. The Town will carry fire
and extended coverage insurance on all above ground
structures in an amount at least equal to the depreciable
replacement value of such structures. The proceeds of
such insurance shall be used to restore the property lost
or damaged and any remainder shall be distributed as net
income. The Town will also maintain as provided by law a
self-insurance fund to cover workmen' s compensation in-
surance and public liability insurance in such amounts
and to such extent as is normally carried by private cor-
porations operating public utilities of the same type.
M. Competing System. The Town shall not
grant any franchise or license to a competing system, or
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permit any person, association, firm or corporation to
sell water, water service or facilities , or sewer service
or facilities, within the Town.
N. Alienating System. The Town will not
sell, lease, mortgage, pledge, alienate or otherwise en-
cumber, the System or any part thereof, until the 1976
Bonds shall have been paid in full, both principal and
interest, or unless provision has been made therefor, ex-
cept any portion which shall have been replaced by other
property of at least equal value, or which shall cease to
be necessary for the efficient operation of the System.
The proceeds of any such sale shall be distributed as net
income .
0. Extended Interest Payments. The Town
will not extend or assent to the extension of the time
for the payment of any coupon or claim for interest on
any of the 1976 Bonds. In case the time for payment of
any such coupons or claims shall be extended , such coupon
or installment or installments of interest shall not be
entitled in case of default hereunder to the benefit or
security of this ordinance except subject to the prior
payment in full of the principal of all the 1976 Bonds,
and of matured interest on the 1976 Bonds the payment of
which has not been extended .
P. Surety Bonds. The Town Treasurer shall
be bonded in the amount of at least $10, 000. FmHA Form
440-24 shall be used for such purpose and such bond shall
name the United States of America as co-obligee.
Q. Town' s Existence. The Town will main-
tain its corporate identity and existence so long as any
of the 1976 Bonds remain outstanding, unless another po-
litical subdivision by operation of law succeeds to the
liabilities and rights of the Town, without adversely af-
fecting to any substantial degree the privileges and
rights of any Bondholder.
R. Performing Duties. The Town will faith-
fully and punctually perform all duties with respect to
the System required by the Constitution and laws of the
State of New Mexico and the ordinances and resolutions of
the Town, including but not limited to making and collect-
ing reasonable and sufficient rates and charges for
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services rendered or furnished by the System and proper
segregation of the revenues of the System and their ap-
plication in the manner provided in this ordinance.
S. Other Liens. Other than as set forth
in this ordinance, there are no liens or encumbrances of
any nature whatsoever, on or against the System or the
revenues derived or to be derived from the operation of
the same.
Section 22 . Events of Default. It is an "event
of default" if:
A. Nonpayment of Principal. Payment of
the principal of any 1976 Bond is not made when due at ma-
turity or upon prior redemption.
B. Nonpayment of Interest. Payment of in-
terest is not made when due.
C. Incapable to Perform. The Town is not
capable of fulfilling its obligations hereunder.
D. Default of any Provision. The Town de-
faults in the punctual performance of its covenants here-
under for sixty days after written notice shall have been
given by the holders of at least twenty-five percent (25%)
in principal amount of the outstanding 1976 Bonds .
Section 23 . Remedies of Default. Upon the oc-
currence and continuance of any event of default , the
holder or holders of not less than twenty-five per cent
(25%) in principal amount of the outstanding 1976 Bonds
or a trustee therefor may protect and enforce the rights
of any Bondholder by proper legal or equitable performance
of any covenant, the appointment of a receiver (the con-
sent to such appointment being hereby granted) , injunctive
relief, or requiring the Board to act as if it were the
trustee of an express trust, or any combination of such
remedies . All proceedings shall be maintained for the
equal benefit of all holders. Any receiver appointed to
protect the rights of Bondholders may take possession
and operate and maintain the System in the same manner as
the Town itself might do. The failure of any holder to
proceed does not relieve the Town or any person of any
liability for failure to perform any duty hereunder. The
foregoing rights are in addition to any other right and
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the exercise of any right by any Bondholder shall not be
deemed a waiver of any other right.
Section 24 . Duties upon Default. Upon the
happening of any event of default, the Town will perform
all proper acts to protect and preserve the security
created for the prompt payment of the principal of and
interest on the 1976 Bonds. In the event the Town fails
or refuses to proceed as in this section provided, the
holder or holders of not less than twenty-five percent
(25%) in principal amount of the outstanding 1976 Bonds,
after written demand, may proceed to protect and enforce
�+ the rights provided in this section. All proceeds de-
rived therefrom shall be distributed as net income.
Section 25 . Prior Charge upon Lower Rates.
If any body, commission or authority lawfully prescribes
a lower schedule of rates than that contemplated by this
ordinance, then the payment of principal and interest on
the 1976 Bonds and parity ponds shall constitute a first
and prior charge on net revenues.
Section 26 . Defeasance. When the 1976 Bonds
have been paid, the pledge and 'Lien and all obligations
hereunder shall be discharged and the 1976 Bonds shall
no longer be deemed to be outstanding. Payment shall be
deemed made when the Board has placed in escrow with a
commercial bank exercising trust powers, an amount suf-
ficient (including the known minimum yield from Federal
Securities) to meet all requirements of principal , inter-
est and prior redemption premium, if any, as the same be-
come due to their final maturities or upon designated
prior redemption dates. Any Federal Securities shall be-
come due when needed in accordance with a schedule agreed
upon between the Board and such bank at the time of the
creation of the escrow or shall be subject to redemption
at the option of the holder thereof to assure the avail-
ability thereof when needed to meet such schedule. Fed-
eral Securities within the meaning of this section shall
include only direct obligations of, or obligations which
are unconditionally guaranteed by, the United States of
America.
Section 27. Delegated Powers. The officers of
the Town be, and they hereby are authorized and directed
to take all action necessary or appropriate to effectuate
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the provisions of this ordinance, including the printing
of the 1976 Bonds (including the opinion of counsel if
so agreed to) , the preparation of and execution by the
Town officials of any certificates reasonably required
by the FmHA and the execution and delivery of the 1976
Bonds.
Section 28. Amendment of Ordinance. This or-
dinance may be amended, without receipt by the Town of
any additional consideratior, but with the written con-
sent of the holders of seventy--five percent (75%) in
principal amount of the 1976 Bonds then outstanding ; but
no ordinance adopted without the written consent of the
holders of all outstanding 1976 Bonds shall have the
effect of permitting:
A. An extension of the maturity of any
1976 Fend; or
B. A reduction in the principal amount
or interest rate of any 1976 Bond; or
C. The creation of a lien upon revenues
ranking prior to the lien or pledge created by this or-
dinance; or
D. A reduction of the principal amount of
1976 Bonds required for consent to such amendatory ordi-
nance; or
E. The establishment of priorities as be-
tween 1976 Bonds issued and outstanding under the provi-
sions of this ordinance; or
F. The modification of or otherwise af-
fecting the rights of the holders of less than all of the
outstanding 1976 Bonds .
The provisions of this section shall not apply
to any amendment of this ordinance which will not adverse-
ly affect the 1976 Bonds if such amendment is effective
prior to the issuance of any of the 1976 Bonds.
Section 29 . Ordinance Irrepealable . After any
of the 1976 Bonds are issued, this ordinance shall be and
remain ir.r_epealable until the 1976 Bonds and the interest
thereon shall be fully paid, canceled and discharged, as
herein provided.
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Section 30 . Severability Clause. If any sec-
tion, paragraph, clause or provision of this ordinance
shall for any reason be held to be invalid or unenforce-
able, the invalidity or unenforceability of such section,
paragraph, clause or provision shall not affect any of
the remaining provisions of this ordinance.
Section 31. Repealer Clause. All bylaws,
orders, resolutions and ordinances, or parts thereof, ex-
cept Ordinances Nos. 528 and622 inconsistent herewith
are hereby repealed to the extent only of such inconsist-
ency. This repealer shall not be construed to revive any
bylaw, order, resolution or ordinance, or part thereof,
heretofore repealed.
Section 32 . Emergency Clause and Effective
Date. This ordinance is necessary for the preservation of
the public health, peace and safety of the inhabitants of
the Town and because the Town is in great need of the
Project, this ordinance is hereby declared to be i emer-
gency measure on the ground of urgent public need. Imme-
diately upon the adoption of this ordinance by at least
three-fourths of all of the fully authorized members of
the entire Board and upon its final passage, the ordinance
shall be recorded in the book of ordinances of the Town
kept for that purpose, authenticated by the signatures of
the Mayor and Town Clerk, and the title and general sum-
mary of the subject matter contained in this ordinance
(set out in Section 33 below) shall be published in the
Taos News, a newspaper which maintains an office in and is
of general circulation in the Town, in accordance with law,
and this ordinance shall be in full force and effect five
days after such publication.
Section 33 . General Summary for Publication.
Pursuant to Section 14-16-4 , New Mexico Statutes Annotated,
1953 Compilation, as amended, the title of, and a general
summary of the subject matter contained in this ordinance
shall be published in substantially the following form:
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(Form of Summary of Ordinance for Publication)
TOWN OF TAOS
NOTICE OF ADOPTION OF ORDINANCE NO. 64o
NOTICE IS HEREBY GIVEN of the title and of a
general summary of the subject matter contained in Ordi--
nance No. 640 duly adopted and approved by the Board
of Trustees of the Town of Taos, New Mexico, on June 10th
1976. A complete copy of Ordinance No. 64o is avail-
able for public inspection during the normal and regular
business hours of the Town Clerk in the office of the
Taos Clerk, Town Hall (i.e . , Municipal Offices) on Armory
Street in the Town of Taos , New Mexico.
The title of Ordinance No. 640 is :
AN ORDINANCE PROVIDING FOR THE EXTENSION , EN-
LARGEMENT, BETTERMENT AND OTHER IMPROVEMENT OF
THE MUNICIPAL JOINT WATER AND SEWER SYSTEM OF
THE TOWN OF TAOS , NEW MEXICO; DECLARING THE
NECESSITY FOR MAKE; AND ISSUING THE TOWN 'S
JOINT WATER AND SE.NER EXTENSION REVENUE BONDS,
PAYABLE SOLELY OUT OF THE NET INCOME TO BE
DERIVED FROM THE OPERATION OF SUCH JOINT SYS-
TEM; AUTHORIZING THE ISSUANCE AND SALE OF SUCH
REVENUE BONDS IN THE AGGREGATE PRINCIPAL AMOUNT
OF $500, 000; PROVIDING FOR THE DISPOSITION OF
THE INCOME TO BE DERIVED FROM THE OPERATION OF
SAID JOINT SYSTEM; ADOPTING BY REFERENCE CER-
TAIN PROVISIONS OF ORDINANCE NO. 528 ,, ADOPTED
AND APPROVED ON JULY 1 , 1963 ; PRESCRIBING OTHER
DETAILS CONCERNING SAID REVENUE BONDS, INCLUD-
ING BUT NOT LIMITED TO COVENANTS AND AGREEMENTS
IN CONNECTION THEREWITH; RATIFYING .ACTION PRE-
VIOUSLY TAKEN CONCERNING SAID JOINT SYSTEM AND
SAID BONDS; REPEALING ALL ORDINANCES IN CON-
FLICT HEREWITH; AND DECLARING AN EMERGENCY.
The following is a general summary of the sub-
ject matter contained in Ordinance No. 640
Preambles rec t` such matters as: Town ' s exist-
ence and ownership of the municipal water and sewer system
(the "System" ) , its only present outstanding obligations
payable from revenues of the System being the issue of
Joint Water and Sewer Refunding Revenue Bonds , Series
July 1 , 1963 ( "1963 Bonds" ) and the issue of. Joint Water
and Sewer Extension Revenue Bonds, Series July 1 , 1973
( "1973 Bonds" ) , the need to extend, enlarge, better and
otherwise improve the System, the ordinances authorizing
the 1963 Bonds and the 1973 Bonds providing for the issu-
ance of bonds having a lien on the System on a parity
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with the lien of the 1963 Bonds or the 1973 Bonds upon
compliance with certain conditions, but that such limi-
tations may not be met, the sufficiency of anticipated
revenues to pay outstanding and the proposed bonds, the
receipt of a commitment from the United States of America,
Farmers Home Administration ("FmHA") for the purchase of
the Town ' s Joint Water and Sewer Extension Revenue Bonds ,
Series 1976 ("1976 Bonds" ) to be authorized for par and
an interest rate of 5% per annum; and the determination
of the Board of Trustees of the Town to authorize the
issuance of the 1976 Bonds and of the Town ' s Joint Water
and Sewer Extension Revenue Bonds , Series 1976 ( "1976
Bonds" ) .
Sections 1 through 4 define terms (incorporat-
ing by reference some of the provisions of Ordinance No .
528) , ratify action by officers of the Town in connection
with the Project (i.e. , extending, enlarging, bettering
and otherwise improving the System) and the 1976 Bonds ,
establish that the water and sewer facilities shall con-
tinue to be a single joint system and authorize the ac-
quisition of the Project.
Section 5 authorizes the 1976 Bonds and gives
details thereof, including but not limited to : the issu-
ance in the aggregate principal amount of $500 , 000, dating
the 1976 Bonds as of the date of delivery, specifying 500
bonds in the denomination of $1, 000 each, providing that
the 1976 Bonds shall bear one set of interest coupons, un-
less registered , such interest being payable May 1 and No-
vember 1 of each year, commencing November 1 , 1976 , and
bearing interest at a rate of 5% per annum, providing for
the place and manner of payment of principal of and inter-
est on the 1976 Bonds, providing that the 1976 Bonds mature
serially or in installments in varying amounts on November 1
in the years 1978 to 2000 , providing for prior redemption
under certain conditions , and for negotiability and registra-
tion as to payment.
Sections 6 through 10 provide for the form and
method of execution of the 1976 Bonds and coupons and regis-
tration panel, that the 1976 Bonds are special obligations
payable from the net revenues of the System, provide the
form of the 1976 coupon Bonds, coupons and registration
grid, and the form and use of a single bond in the aggre-
gate principal amount of $500 , 000 without coupons .
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Sections 11 through 18 determine the period of
usefulness of the Project, provide for the disposition
of the proceeds of the 1976 Bonds into a construction
fund, that the purchasers are not responsible for appli-
cation of the bond proceeds, establish the fiscal year
for the System, provide for continued deposit into the
Income Fund previously established and provide for the
Bond Fund and Reserve Fund for the 1976 Bonds and other
details concerning said funds and net revenues of the
System, for the administration of all funds and accounts
created or continued by the ordinance, for the investment
of moneys in the funds , the places and times of deposit
of money in the funds, that the 1976 Bonds shall not be
arbitrage bonds, that the 1976 Bonds constitute a first
(but not an exclusively first) lien on the net revenues
of the System, subject and junior to the prior and supe-
rior lien for the 1963 Bonds and 1973 Bonds , and for
equality among the 1976 Bonds in the application of the
net revenues.
Sections 19 through 21 set forth the terms and
conditions under which parity lien bonds may be issued,
permit the issuance of bonds having a subordinate lien,
prohibit the issuance of bonds having a superior lien,
set out the terms and conditions relative to refunding
bonds and provide for protective covenants whereby the
Town covenants with each bondholder for the protection
of each bondholder covering such matters as : use of bond
proceeds; payment of the 1976 Bonds; charges for the use
of the System; levy of charges; efficient operation of
the System; records; right to inspect the System; audits
and budgets concerning the System, billing procedures and
discontinuance of service; use of 1976 Bond Fund and Re-
serve Fund; charges and liens upon the System; insurance ;
prohibition against competing system; alienating System;
extending interest payments; surety bonds , faithful per-
formance of duties by Town; other liens ; and Tot n ' s
existence .
Sections 22 through 33 concern events of default
and remedies for and duties upon default, provide for
prior charges upon lower rates, defeasance , delegate cer-
tain powers to Town officials , provide a procedure for
amendment of the ordinance, state the ordinance is irre-
pealable, provide for severability and repealer clauses,
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declare an emergency and provide for the effective date
of the ordinance and a form for publication.
There is also a statement by the Mayor that.
this ordinance is an emergency.
WITNESS my hand and the seal of the Town of
Taos, New Mexico, this loth day of June, 1976.
/s/ Josephine Gonzales
Town Clerk
(SEAL)
(End of Form of Summary of ordinance for Publication)
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PASSED, ADOPTED, SIGNED AND APPROVED this
1Otb day o`: June, 1976.
f
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,c Llb 0-",
Ma or
(SEAL)
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Attest:
Town Clerk
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I, the Mayor of the Town of Taos, New Mexico,
do hereby declare that an emergency exists with respect i
to the foregoing ordinance because of the urgent need
for the Project which is for the public health, safety
and welfare of the Town and that any publication of such
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ordinance prior to its adoption hereby is declared to be '
unnecessary. i
WITNESS my hand this loth day of June, 1976 .
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Thereupon, the Mayor, pursuant to Section
14-16-2 . 1, NMSA 1953 declared that such ordinance is
an emergency, such declaration being set forth in the
statement attached to the ordinance.
It was then moved by Trustee Fernando Valdez
and seconded by Trustee Lawrence Santistevdabat any and all
rules of the Board of Trustees which might prevent, un-
less suspended, the final passage and adoption of this
ordinance at this meeting be, and the same hereby are
suspended for the purpose of permitting the final pas-
sage and adoption of this ordinance at this meeting.
The question being upon the adoption of said
motion and the suspension of the rules, the roll was
called with the following result:
Those Voting Aye : Lawrence Santistevan
Fernando Valdez
Joe A Sanchez
Those Voting Nay: None
Those Absent: Fioy .1eantete
Three members of the Board of Trustees
having voted in favor of said motion, the presiding of-
ficer declared said motion carried and the rules
suspended.
Trustee Fernando Valdez then moved that said or-
dinance be passed and adopted as read. Trustee Lawrence Santistevan
seconded the motion. The question being upon the passage
and adoption of said ordinance, the roll was called with
the following result:
Those Voting Aye: Lawrence Santistevan
Fernando Valdez
Joe A. Sanchez
Those Voting Nay: None
Those Absent: Eloy Jeantete
The Mayor thereupon declared said motion car-
ried by the affirmative vote of at least three-fourths of
the members of the entire Board of Trustees and the said
ordinance duly passed and adopted.
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Upon motion duly adopted, it was ordered that
said ordinance, after due authentication by the Mayor of
the Town of Taos and the Town Clerk, be recorded accord-
ing to law.
Thereupon, the Board of Trustees considered
other business not concerning the Town's bonds .
Thereafter, there being no further business
to come before the meeting, the same was, on motion
made, seconded and unanimously adopted, duly adjourned.
1.
ayor
(SEAL)
Attest: /
!� �/Town Clerk
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STATE OF NEW MEXICO )
COUNTY OF TAOS ) Ss .
TOWN OF TAOS )
I , Josephine Gonzales , Town Clerk of the Town
of Taos , New Mexico (the "Town") , do hereby certify:
1. The f oregoing pages numbered from 1 to 53 ,
inclusive, constitute a full, true and correct copy of
the record of the proceedings taken by the Board of
Trustees of the Town at a lawful publicregular. meeting 7h '
thereof , held at 7:30 p.m. on June 10, 1976 , at the Town
Hall (i.e. , the Town 's Municipal Offices) on Armory Street,
in Taos , New Mexico , insofar as said proceedings relate
to an ordinance , a copy of which is therein set forth , and
said copy of said ordinance as contained in said proceed-
ings is a full, true and correct copy of the original of
said ordinance as passed by the Board of Trustees at said
meeting.
2. Said original ordinance has been duly authen-
ticated by the signatures of the Mayor of the Town and my-
self as Town Clerk , sealed with the corporate seal of the
Town, signed and approved by the Mayor thereof, and recorded
in the book of ordinances-of the Town kept for that purpose
in my office , which record has been duly signed by said
officers and sealed with the seal of the Town.
3 . Attached hereto as Exhibit A is a correct copy
of the affidavit of publication of the Notice of Meeting And
Proposed Ordinance for the meeting at which said ordinance
was adopted. Said notice was published at least two weeks
prior to the date of said meeting , in full conformity with
Sections 14-16-2. 1 and 5-6-23 , New Mexico Statutes Annotated,
1953 Compilation, as amended, and with a resolution adopted
by the Board of Trustees on March 24 , 1976 , which 4" -
established reasonable notice for actions by the Board of
Trustees pursuant to Section 5-6-23 , New Mexico Statutes
Annotated, 1953 Compilation, as amended.
4 . Said ordinance was on June 17 1976 ,
published by title and summary in the Taos News , being the
official newspaper and a newspaper which maintains an
office in and is of general circulation within the Town,
a copy of the affidavit of publication therefor being at-
tached as Exhibit B.
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5. The Mayer and three other members of the
Board of Trustees wer:, present at said meeting, and the
members of the Board of Trustees voted on the passage of
said ordinance as in said minutes set forth.
6. All members of the Board of Trustees were
given due notice of said meeting.
i
IN WITNESS WHEREOF, I have hereunto sea my
hand and the seal of the Town this 'I' day of ,
1976.
%'Town Clerk
(SEAL)
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EXHIBIT A
(Attach Affidavit of lublication
of Notice of Meeting)
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EXHIBIT B
(Attach Affidavit of Publication of the
Ordinance Subsequent to Adoption)
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CONSENT TO NOTICE OF SPECIAL
MEETING HELD ON JUNE 10, 1976
TO THE BOARD OF TRUSTEES
OF THE TOWN OF TAOS
COUNTY OF TAOS
STATE OF NEW MEXICO:
The special meeting of the Board of Trustees
of the Town of Taos, which was held at the Town Is Munici-
pal Offices on Armory Street, in the Town of Taos, County
of Taos and State of New Mexico at 7 :30 p.m. , on Thursday,
the 10tr day of June, 1976, for the purpose of consider-
ing action relating to the Town's joint water and sewer
system and for the transaction of such other business
incidental to the foregoing as may come before said meet-
ing, was duly called by the undersigned Mayor more than
twenty-four hours prior to the start of such meeting.
(2
ayor
Town V
k
We, the undersigned members of the Board of
Trustees of the Town of Taos, do hereby acknowledge
receipt of written notice of such special meeting of
June 10, 1976. We were given notice of such meeting (in-
cluding the time, place and the matters to be acted upon,
i.e. , Ordinance No. 640) by Taos News
at least
twenty-four hours prior to such meeting. We hereby waive
any and all irregularitie3, if any, in such notice and in
the manner of service thereof upon us, and consent and
agree to the holding of such special meeting at the time
and place specified in said notice, and to the transaction
of any and all business which came before such meeting.
BOARD OF TRUSTEES
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Z.Z//Z4")
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STATE OF NEW MEXICO )
GENERAL AND
COUNTY OF TAOS ) SS.
NO-LITIGATION CERTIFICATE
TOWN OF TAOS )
IT IS HEREBY CERTIFIED by the undersigned, the
duly chosen, qualified and acting Mayor, Town Clerk-
Treasurer and Town Attorney of the Town of Taos (herein
the "Town") , in the County of Taos and State of New Mexico :
1. As determined by the federal census of 1970 ,
the population of the Town was 2 ,475, and the present es-
timated population is 2950
2 . The Town was incorporated pursuant to and is
now operating under the general laws of the State of New
Mexico as a Town; the Town was incorporated as a Town on
the 7th day of May, 1934; and the validity of such incor-
poration and organization has never been questioned.
3. The Town as originally incorporated has nev-
er been consolidated with or annexed to any other munici-
pality, and no territory has been disconnected from the
Town as originally incorporated.
4. From at least the first day of March, 1976
up to and including the date of this certificate, the fol-
lowing have been and now are the duly chosen , qualified
and acting officers of said Town:
Mayor: Phillip Cantu, Jr.
Trustees : Lawrence Santistevan
Fernando Valdez
Joe A. Sanchez
Eloy Jeantete
Town Manager: Ernest Romero
Town Clerk-Treasurer: Josephine Gonzales
Town Attorney: James M. Brandenburg
5. There is no reason within our knowledge why
the Town may not deliver its "Town of Taos Joint Water
and Sewer Extension Revenue Bonds, Series 1976" in the ag-
gregate principal amount of $500, 000 (herein the "Bonds"
or "1976 Bonds" ) , which are being delivered originally as
a single bond in the denomination of $500,000 .
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6 . Subsequent to the authorization to issue the
1976 Bonds, the Town has not pledged or otherwise encum-
bered any of the revenues derived from the operation of
its joint water and sewer system (as def?ned in Ordinances
Nos. 528, 621 and 640 and herein the "System") or any part
thereof; and there are no liens or encumbrances of any
kind or description against such revenues of the System
except the liens or encumbrances designated in Ordinance
No. 528, adopted and approved on July 1, 1963 , authorizing
the Town of Taos Joint Water and Sewer Refunding Revenue
Bonds, Series July 1, 1963 , in Ordinance No. 621 , adopted
and approved on May 1 , 1973 , authorizing the issuance of
•the Town of Taos Joint Water and Sewer Extension Revenue
Bonds, Series May 1, 1973 , and in Ordinance No . 640,
adopted and approved on June 10 , 1976 , authorizing the is-
suance of the 1976 Bonds.
7 . No litigation of any nature is now pending
or insofar as is known to the undersigned , threatened (ei-
ther in state or federal courts) restraining or enjoining
the issuance, sale, execution or delivery of the 1976
Bonds, the extending, enlarging, bettering and other im-
proving of the System (herein the "Project" ) , or the levy,
fixing, charging, collection or application of adequate
revenues , rates and charges to pay the cost of operation
and maintenance of the System and ti.,F! payment of the prin-
cipal of and interest on the 1976 Bonds or the pledge
thereof or otherwise carrying out the terms and provisions
of the ordinances and resolutions authorizing the issuance
of said 1976 Bonds or otherwise concerning them, and the
covenants and agreements therein, or in any manner ques-
tioning or otherwise affecting the validity thereof;
neither the corporate existence or boundaries of the Town
nor the title of its present officers to their respective
offices is being contested; and no proceedings or author-
ity for the issuance , sale, execution or delivery of said
1976 Bonds have , or has been repealed, rescinded , revoked,
modified, changed or altered in any manner.
8. The regular meetings of the Board of
Trustees are scheduled to be held at the Town ' s Municipal
Offices, on Armory Street, within the Town at the hour of
7 : 30 p.m. , on the second Wednesday of each month.
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9. No referendum petition concerning any of
the ordinances, resolutions, or other proceedings concern-
ing the Project, any of the revenues of the System, and
rates and revenues of the 1976 Bonds to be issued , has
been filed; and to the best of our knowledge, none is be-
ing circulated or planned for circulation.
10. The population of the Town is not less than
seventy-five percent English speaking , and is less than
twenty-five percent Spanish speaking.
11. To the best of our knowledge, neither the
Mayor, any member of the Board of Trustees, nor any other
officer, employee, or any other agent of the Town is in-
terested (except in the performance of his official rights,
privileges, powers and duties) , directly or indirectly, in
the profits of any contract, or job of work, or services
to be performed, appertaining to the issuance of the Bonds
or to the effecting of the Project.
12. The Town has no written bylaws or rules of
procedure.
13. The Taos News is a legal newspaper which
maintains an office in and is of general circulation in
Taos, New Mexico.
14 . The Town owns its own source of water supply
and does not purchase water for distribution.
15. The Town has not adopted the New Mexico Pub-
lic Service Commission regulatory and supervisory provisions
of Chapter 84 , Laws of New Mexico, 1941, pursuant to the
local option provisions of Section 17A of said Chapter 84 ,
also cited as Section 68-5-5 , New Mexico Statutes Annotated,
1953 Compilation, or otherwise.
16. The 1976 Bonds are not obligations (A) which
are issued as part of an issue all or a major portion of
the proceeds of which are to be used directly or indirectly
in any trade or business carried on by any person who is
not an exempt person within the meaning of paragraph (3) of
Section 103 (c) , United States Internal Revenue Code of 1954 ,
as amended (herein the "Tax Code") , and (B) the payment of
the principal or interest on which (under the terms of such
obligations or any underlying arrangement) is, in whole or
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in major part (i) secured by any interest in property used
or to be used in a trade or business or in payments in
respect of such property, or (ii) to be derived from pay-
ments in respect of property, or borrowed money, used or
to be used in a trade or business. Thus the 1976 Bonds are
not "industrial development bonds" within the meaning of
Section 103 (c) , Tax Code, and the applicable regulations
thereunder promulgated by the Internal Revenue Service,
17. Federal grants or loans for the Project be-
ing financed by the 1976 Bonds have been or will be re-
ceived from the U. S . Economic Development Administration;
and to the best of our knowledge, the necessary proceed-
ings relating to required federal environmental impact
statements have been taken. Except as aforesaid, such
Project will not be supported in whole or in part through
any other contracts entered into by or grants, subsidies,
loans or other forms of funding assistance made by any
agency of the United States Government, and such Project
does not and will not involve a lease entered into by or
a permit, license, certificate or other entitlement for
use issued by any agency of the United States Government.
18. The Board of Trustees gave two weeks' notice
by publication of the meeting at which Ordinance No. 640
was adopted, in conformity with Section 5-6-23 , NMSA, 1953
Compilation , as amended, and with Resolution No. 76-3 ,
adopted by the Board of Trustees on March 24 , 1976 (super-
seding Resolution No. 741, which previously established
standards as to what constitutes reasonable notice of Board
meetings) and Section 14-16-2. 1 , NMSA 1953 . No meetings of
a quorum of the Board of Trustees discussing the 1976 Bonds
or the Project to be financed by the 1976 Bonds occurred
subsequent to October 16 , 1974 without compliance with
Section 5-6-23, NMSA, 1953 Compilation, as amended , and
either Resolution No. 741 or Resolution No. 76-3 , whichever
was then applicable.
19. This certificate is for the benefit of
each holder of any of the 1976 Bonds from time to time.
IN WITNESS WHEREOF, we have hereunto set our
hands and affixed the seal of the Town of Taos, in the
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County of Taos and State of New Mexico, this 20th day of
August , 1976.
i
M I'
M yor'
fT - Clerk easurer
(SEAL) 1 own Attorney
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STATE OF NEW MEXICO )
COUNTY OF TAOS ) SS . SIGNATURE CERTIFICATE
TOWN OF TAOS )
We, the undersigned, the duly qualified and act-
ing Mayor, Clerk and Treasurer of the Town of Taos (the
"Town" ) , Taos County, New Mexico, do hereby certify:
1. The undersigned at the -date of the signing
hereinafter stated, and on the date hereof , are the duly
chosen, qualified and acting officers authorized to execute
the non-negotiable single bond hereinafter described and
hold the offices indicated by the off icial titles stet oppo-
site our respective names.
2. On August 20 ► 1976 , the undersigned Mayor,
Town Clerk and Town Treasurer officially signed , manually
subscribed, executed and .attested the non-negotiable single
bond numbered R-1 described as the "Town of Taos Joint
Water and Sewer Extension Revenue Bond, Series 1976" (the
"Bond" ) in the aggregate principal amount of $500, 000, or
such lesser sum as shall represent the aggregate advances
made to the Town by the Farmers Home Administration of the
United States Department of Agriculture, authorized by Or-
dinance No. 640 , passed, adopted, signed and approved on
June 10, 1976.
3. The seal of the Town which has been impressed
on the bond is the legally adopted, proper and only official
corporate seal of the Town.
WITNESS our hands and the seal of the Town this
day of , 1976.
TERM OF OFFICE
SIGNATURE OFFICIAL TITLE EXPIRES
Mayor
Town Clerk
�,' c ✓ Town Treasurer
The signatures above guaranteed as those of the
officers designated above.
Fir-,t RtatA P;;Dk of TansBANK
c�
(BANK SEAL) By
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ARE THE BEST AVAILABLE COPIES.
STATE OF NEW MEXICO )
DELIVERY CERTIFICATE
COUNTY OF TAOS ) SS.
AND RECEIPT
TOWN OF TAOS )
We, the undersigned, the duly qualified and act-
ing Mayor, Clerk and Treasurer of the Town of Taos, Taos
County, New Mexico, do hereby certify:
1. On August 21, 1976, the undersigned
Treasurer delivered to the United States of America, Farmers
Home Administration, Department of Agriculture ("FmHA") the
non-negotiable single bond numbered R-1 in the aggregate
principal amount of $500 ,000, designated as the Town of
Taos Single Registered Joint Water and Sewer Extension
Revenue Bond, Series 1976 ("Bond" ) , and received from the
FmHA in payment therefor, the sum of $500,000.
2. On such date, we dated such Bond numbered R-1
with such date of delivery.
3. At the time of said delivery, no coupons were
attached to the Bond because the Bond was registered as to
both principal and interest as provided in paragraph 4
hereof.
4. Simultaneously with the delivery of the Bond,
the Clerk entered the name "United States of America, Farm-
ers Home Administration" in the registration book estab-
lished for that purpose as the initial owner of the Bond ,
WITNESS our hands and the seal of the Town this
2 Oth day of _ August , 1976.
r
i
�1
` miyor
CZ
Town Cltark
:cs c• ,_
Town T a urer
i
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STATE OF NEW MEXICO )
BOND PROCEEDS
COUNTY OF TAOS ) SS.
INVESTMENT CERTIFICATE
TOWN OF TAOS )
I , the undersigned, the duly qualified and act-
ing Town Manager of the Town of Taos ("Town.') , Taos County,
New Mexico , do hereby certify that I have, either alone or
with others , the responsibility for the issuance by the
Town on the date hereof of its "Town of Taos Joint Water
and Sewer Extension Revenue Bond, Series 1976" ("Bond") in
the aggregate principal amount of $500, 000, which is being
issued to finance the extension, enlargement, betterment
and other improvement of the Town ' s municipal joint water
and sewer system ("Project" ) and that I reasonably expect
that :
1 . The total cost of the Project will be
$ 500, 000 , 00
2 . Construction work on the Project shall com-
mence on December 15, 197 6 and completion of the
Project will occur no later than August _2Q, 197_7
3 . The Town has heretofore entered into binding
contracts in connection with the Project with a firm of
consulting engineers pursuant to which the Town will expend
more than $12 ,500 (2-1/2% of the principal amount of such
Bond) of the proceeds of the Bond on the Project.
4 . The "original proceeds" of the Bond are
$500 , 000 (i .e. , the principal amount of $500 , 000 plus $-0-
received by the town as accrued interest) .
5. The amount of "original proceeds" to be
expended on the Project during the three-year period begin-
ning on the date the Bond is delivered ("temporary period")
is $500, 000 .
6. All of the investment proceeds to be received
during the temporary period will be expended for payment of
Project costs during the temporary period.
7 . The Town will not sell or otherwise dispose
of the Project in whole or in part prior to the maturity of
the Bond.
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FILMED DOCUMENTS
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8 . The Town has not yet expended any money for
the Project and does not reasonably expect to use the
proceeds of the Bond to fund or refinance any Town obliga-
tions (including any governmental obligations issued for
temporary financin") .
9. The Town has never issued bonds or other
obligations to finance the specific Project being financed
with the proceeds of the Bond. Consequently, the Bond does
not constitute a replacement issue of obligations.
10. Based upon the foregoing:
(a) At least 85% of the "original pro-
ceeds" will be lawfully expended on the Project
during the temporary period,
(b) The Town has heretofore incurred a
substantial binding obligation to commence the
Project,
(c) Work on the Project will proceed
with due diligence to completion, and
(d) The "original proceeds" of the
Bond will not exceed by more than 5% the amount
necessary to finance the Project.
On the basis of all the f acts, estimates and cir-
cumstances now in existence, it is not now expected that
the proceeds of the Bond will be used in a manner that
would cause the Bond to be an "arbitrage bond" within the
meaning of Section 103 (d) of the Internal Revenue Code of
1954 , as amended, and the regulations prescribed under that
section. To the best of my knowledge and belief, there are
no other facts, estimates or circumstances that would mate-
rially change the foregoing conclusion. The Town has not
been notified of any listing or any proposed listing of it
by the Internal Revenue Service as an issuer whose arbitrage
certificates may not be relied upon.
WITNESS my hand and the seal of the Town this
20th day of August 1976 .
Town Manager
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