RES 84176 - Laserfiche WebLink

BONDOWNERS' RISKS General In order to pay debt service on the Bonds, it is necessary that unpaid installments of assessments on land within the District are paid in a timely manner. Should the installments not be paid on time, the City has established a Reserve Fund in the amount of six percent (6%) of the principal amount of the Bond issue to cover delinquencies and, pursuant to the Bond Law, will use available surplus funds of the City to pay such delinquent installments. The assessments are secured by a lien on the parcels of land and the City can institute foreclosure proceedings to sell land with delinquent installments for the amount of such delinquent installments in order to obtain funds to pay debt service on the Bonds. Failure by owners of the parcels to pay installments of assessments when due, depletion of the Reserve Fund, lack of available surplus funds of the City, or the inability of the City to sell parcels which have been subject to foreclosure proceedsings for amounts sufficient to cover the delinquent installments of assessments levied against such parcels may result in the inability of the City to make full or punctual payments of debt service on the Bonds and Bondowners would therefore be adversely affected. Unpaid assessments do not constitute a personal indebtedness of the owners of the lots and parcels within the District. There is no assurance the owners will be able to pay the assessment installments or that they will pay such installments even though financially able to do so. Bonds are Subordinate Lien Bonds In May 1983, the City of Pleasanton issued $45,775,000 principal amount of 1915 Act Improvement Bonds to finance the acquisition of various street and utility improvements to the land comprising Phase I of Hacienda Business Park. The boundaries of this assessment district (Assessment District No. 1983-2 (Hacienda Business Park)) are coterminous with the boundaries of Assessment District No. 1984-1, Hopyard Road, securing repayment of the Bonds described herein. Accordingly, the bonds which were issued to finance Assessment District No. 1983-2 are secured by prior assessment lien against the land in the District and, therefore, have priority over the Bonds described herein being issued to finance Assessment District No. 1984-1, Hopyard Road. In the event that the respective assessment liens shall both be delinquent on both such assessment liens the proceeds of sale of the delinquent property upon concurrent foreclosure will first be applied to payment in full of principal and interest of the Assessment District No. 1983-2 bonds. Any proceeds remaining after payment of the Assessment District No. 1983-2 bonds in full will be applied to the payment of the Bonds described herein. -35-