Council Meeting Minutes - 2011-12-13

PROCEEDINGS OF THE COUNCIL OF THE CITY OF ALEXANDRIA, LOUISIANA, STATE OF LOUISIANA, TAKEN AT A REGULAR MEETING HELD DECEMBER 13, 2011.

The Council of the City of Alexandria, Louisiana, met in a regular meeting session at its regular meeting place, on Tuesday, December 13, 2011 at 5:00 P.M.  There were present the Honorable Roosevelt L. Johnson, Ed Larvadain, III,  Harry B. Silver, James “Jim” Villard, Mitzi Gibson and Chuck Fowler.  Also present were members of the Council staff and members of the Legal Division.  (Chuck Johnson and Trey Gist)   Also present were Mayor Jacques Roy, Ms. Kay Michiels and other members of the Administrative Staff. 

The Council of the City of Alexandria, State of Louisiana, was duly convened as the governing authority of said City by the Honorable Roosevelt L. Johnson, who stated that the Council was ready for the transaction of business. The Invocation was pronounced by Reverend Darrell Freeman and the Pledge of Allegiance was led by Councilman Harry B. Silver.

APPOINTMENT

                         The President first spoke concerning the resignation of Jonathan D. Goins as Councilman for District 3.  He confirmed that the Secretary of State’s Office had received his resignation and that the Council needed to appoint a replacement by December 16, 2011, as per the Secretary of State. 

                         The President asked the Clerk to read the item which was to consider adoption of a resolution for the appointment to fill the vacancy in the Office of City Council District 3 and other matters related thereto.  Ms. Gibson made a motion for discussion and to open up the nominations which was seconded by Mr. Silver.

                         Mr. Villard nominated Mr. Jerry Jones, which was seconded by Mr. Silver.

                         Mr. Larvadain nominated Ms. Vonn Jennings which was seconded by Ms. Gibson.

                         A motion was made by Mr. Villard and seconded by Mr. Silver to close the nominations and a roll call vote was called for and resulted as follows:

YEAS:                Villard, Silver, Johnson, Larvadain, Fowler, Gibson.

NAYS:                None.

ABSENT:           None.

                         Mr. President called on the speakers that had signed up to speak on this item which were as follows: Jerry Jones, Vonn Jennings, Lou Howard, Joe Page, Michael Zielger, LaShaun Brown, Jay Johnson, Reverend Clarence
Dupar, Jr., and Ms. Sandra Bright.    Each person was given three minutes to speak.    Ms. Gibson next read a letter from Jonathan Goins supporting Vonn Jennings for the position and also presented a petition supporting Ms. Jennings for this position and which was made a part of the record.   

                         The question was called with a motion made by Mr. Villard and seconded by Mr. Silver. 

                         Mr. President called on a vote for Ms. Vonn Jennings to be appointed to the position and the vote resulted as follows:

YEAS:                Gibson, Johnson, Larvadain.

NAYS:                Villard, Silver, Fowler, Mayor Roy.

ABSENT:           None.

ABSTAIN:          None.

The vote was 3 yeas, 3 nays and it was tied, therefore Mayor Roy announced his No vote, which resulted in a failed resolution.

                         Mr. President called on a vote for Mr. Jerry Jones to be appointed to the position and the vote resulted as follows:

YEAS:                Silver, Fowler, Villard, Mayor Roy.

NAYS:                Johnson, Larvadain, Gibson.

ABSENT:           None.

ABSTAIN:          None.

The vote was 3 yeas, 3 nays and it was tied, therefore Mayor Roy announced his Yes vote, which resulted in 4 yeas, 3 nays and the resolution was adopted.

(Note of Interest:  There was history made at this meeting tonight.  This was the first time since our form of government was formed that the Mayor had to break a tie vote for an appointment to be made to the City Council)

                         The following resolution was adopted.

Mr. Villard moved for the adoption of the following resolution which was seconded by Mr. Silver, to wit:

                             RESOLUTION NO.   9001-2011

A RESOLUTION APPOINTING MR. JERRY W.

JONES, JR. TO SERVE THE REMAINING

TERM OF COUNCIL DISTRICT 3 FOR THE

CITY OF ALEXANDRIA.

The President called for any discussion.  There being no further discussion, a vote was called for and resulted as follows:

YEAS:                Silver, Fowler, Villard, Mayor Roy.

NAYS:                Johnson, Larvadain, Gibson.

ABSENT:           None.

ABSTAIN:          None.

The resolution was thereupon declared adopted on this the 13^th day of December, 2011.

                         At this time, the Clerk announced that the office prepared an Oath of Office for the new Councilman to be sworn in.  City Judge Richard Starling, Jr., was present at the meeting and administered the Oath of Office to Mr. Jerry W. Jones, Jr., as Councilman for District 3 for the City of Alexandria.   After being sworn in, Mr. Jones spoke a few words.

ELECTIONS

PRESIDENT

                         Mr. President turned over the election process to Mr. Trey Gist, Assistant City Attorney to conduct.

                         Mr. Gist called for nominations to elect a President of the Alexandria City Council.  Mr. Fowler nominated Harry Silver which was seconded by Mr. Villard.  Ms. Gibson nominated Ed Larvadain which was seconded by Mr. Johnson.  It was moved and seconded that the nominations for President be closed.  Mr. Gist stated that the last nomination made would be voted on first.  A roll call vote was called on the nomination of Ed Larvadain as President which resulted as follows:

YEAS:                Johnson, Larvadain, Gibson.

NAYS:                Villard, Jones, Silver, Fowler.

ABSENT:           None.

There were 3 yeas, 4 nays and the motion fails.

Mr. Fowler moved for the adoption of the following resolution which was seconded by Mr. Villard, to wit:

                             RESOLUTION NO.   9002-2011

A RESOLUTION ELECTING HARRY B. SILVER

TO SERVE AS PRESIDENT OF THE

ALEXANDRIA CITY COUNCIL.

The President called for any further discussion.  There being no further discussion, a roll call vote was called on the nomination of Harry Silver as President which resulted as follows:

YEAS:                Villard, Jones, Silver, Fowler.

NAYS:                Johnson, Larvadain, Gibson.

ABSENT:           None.

There were 4 yeas, 3 nays and the resolution was therefore adopted on this the 13^th day of December, 2011.

VICE-PRESIDENT

                         Mr. Gist called for nominations for Vice-President of the City Council.  Mr. Larvadain nominated Mitzi Gibson which was seconded by Mr. Johnson.  Mr. Villard nominated Chuck Fowler which was seconded by Mr. Silver.  It was moved and seconded that the nominations for Vice-President be closed.  Mr. Gist stated that the last nomination made would be voted on first.  A roll call vote was called on the nomination of Chuck Fowler as Vice-President and the vote resulted as follows:

YEAS:                Silver, Villard.

NAYS:                Jones, Johnson, Larvadain, Fowler, Gibson.

ABSENT:           None.

There were 2 yeas, 5 nays and the motion fails.

Mr. Larvadain moved for the adoption of the following resolution which was seconded by Mr. Johnson, to wit:

                             RESOLUTION NO.   9003-2011

A RESOLUTION ELECTING MITZI GIBSON

TO SERVE AS VICE PRESIDENT OF THE

ALEXANDRIA CITY COUNCIL.

The President called for any further discussion.  There being no further discussion, a roll call vote was called on the nomination of Mitzi Gibson as Vice President which resulted as follows:

YEAS:                Fowler, Gibson, Villard, Jones, Silver, Johnson, Larvadain.

NAYS:                None.

ABSENT:           None.

There were 7 yeas, 0 nays and the resolution was therefore adopted on this the 13^th day of December, 2011.

CONSENT CALENDAR                                                                                               

The Council next read all items found under the heading Consent Calendar and assigned them to committees.

Mr. Silver moved for the adoption or introduction of all items appearing under the heading of Consent Calendar.

                         Mr.  Silver moved that the Clerk be instructed to set each consent item out in the minutes separately to reflect the proper movers and votes.

Mr.  Villard seconded the motion.  It was unanimously carried by the Council.

                         On motion of Mr. Silver, seconded by Mr. Villard, the minutes taken from a regular meeting which was held November 29, 2011 were unanimously approved by the Council.

                         Bids were received for janitorial supplies for a twelve month period.

Name of Bidders                

Matlock Supply

Pyramid

Calico

All American Poly

Sam Tell & Son

Interboro Corporation

Central Poly Corporation

Sayes Office Supply

Long’s Preferred Products

                         The above bids were referred to the Mayor and appropriate committee for tabulation and recommendation.  The following ordinance was introduced by Mr. Silver, seconded by Mr. Villard, to wit:

AN ORDINANCE AUTHORIZING THE MAYOR TO

ACCEPT THE LOW BID SUBMITTED FOR

JANITORIAL SUPPLIES FOR A TWELVE MONTH

PERIOD, AS REFLECTED BY BIDS

RECEIVED AND TO ENTER INTO CONTRACT

FOR SAID SUPPLIES AND OTHER MATTERS

WITH RESPECT THERETO.

On motion of Mr. Silver and seconded by Mr. Villard, the following ordinance was introduced:

                         AN ORDINANCE AUTHORIZING CHANGE

                         ORDER #1 FOR BOILER TUBE REPAIRS

                         FOR UNIT #3 WEST AND EAST WALL FOR

                         D.G. HUNTER GENERATING STATION AND

                         OTHER MATTERS WITH RESPECT THERETO.

On motion of Mr. Silver and seconded by Mr. Villard, the following ordinance was introduced:

                         AN ORDINANCE AUTHORIZING THE MAYOR

                         TO ACCEPT THE LOWEST QUOTES RECEIVED

                         FOR HARDWARE & SAFETY FOR A TWELVE

                         MONTH ERIOD AND OTHER MATTERS

                         WITH RESPECT THERETO.

On motion of Mr. Silver and seconded by Mr. Villard, the following ordinance was introduced:

                         AN ORDINANCE AUTHORIZING THE MAYOR TO

                         ACCEPT THE LOW BID SUBMITTED FOR 2011

                         MODEL YEAR, FORD CROWN VICTORIA

                         POLICE INTERCEPTOR VEHICLES FOR

                         ALEXANDRIA POLICE DEPARTMENT, AS

                         REFLECTED BY BIDS RECEIVED DECEMBER

                         20, 2011 AND TO ENTER INTO CONTRACT

                         FOR SAID VEHICLES AND OTHER MATTERS

                         WITH RESPECT THERETO.

Mr. Silver moved for the adoption of the following resolution which was seconded by Mr. Villard, to wit:

                             RESOLUTION NO.   9004-2011

A RESOLUTION CANCELING THE REGULAR

COUNCIL MEETING SCHEDULED FOR

DECEMBER 27, 2011.

The President called for any discussion.  There being no further discussion, a vote was called for and resulted as follows:

YEAS:                Silver, Johnson, Larvadain, Fowler, Gibson, Villard, Jones.

NAYS:                None.

ABSENT:           None.

The resolution was thereupon declared adopted on this the 13^th day of December, 2011.

Mr. Silver moved for the adoption of the following resolution which was seconded by Mr. Villard, to wit:

                             RESOLUTION NO.   9005-2011

A RESOLUTION AUTHORIZING ADVERTISEMENT

FOR BIDS FOR CONSTRUCTION OF SCADA

SYSTEM ADDITIONS AND UPGRADES FOR THE

WASTEWATER DEPARTMENT.  BIDS TO BE

OPENED JANUARY 24, 2012.

The President called for any discussion.  There being no further discussion, a vote was called for and resulted as follows:

YEAS:                Silver, Johnson, Larvadain, Fowler, Gibson, Villard, Jones.

NAYS:                None.

ABSENT:           None.

The resolution was thereupon declared adopted on this the 13^th day of December, 2011.

ORDINANCES FOR FINAL ADOPTION

SUBJECT TO PUBLIC HEARING

The following ordinance which was previously introduced and laid over for publication of notice and no objection having been filed there to was brought up for final adoption on motion of Mr. Fowler and seconded by Ms. Gibson, to wit:

                                       ORDINANCE NO.    186-2011

                         AN ORDINANCE AUTHORIZING THE MAYOR

                         TO ACCEPT THE LOW BID SUBMITTED FOR

                         SUGARHOUSE ROAD PACKAGE 1, OUTFALL

                         IMPROVEMENT PROJECT, AS REFLECTED

                         BY BIDS RECEIVED AND TO ENTER INTO

                         CONTRACT FOR SAID PROJECT AND

                         OTHER MATTERS WITH RESPECT THERETO.

                         The President called for any discussion.  There being no other discussion, a vote was called and the following recorded:

YEAS:                Fowler, Gibson, Villard, Jones, Silver, Johnson, Larvadain.

NAYS:                None.

ABSENT:           None.

The ordinance was thereupon declared adopted on this the 13^th day of December, 2011.

The following ordinance which was previously introduced and laid over for publication of notice and no objection having been filed there to was brought up for final adoption on motion of Mr. Fowler and seconded by Mr. Larvadain, to wit:

                                       ORDINANCE NO.    187-2011

                         AN ORDINANCE AUTHORIZING THE MAYOR TO

                         ACCEPT THE LOW BID SUBMITTED FOR ONE

                         REAR LOADING REFUSE TRUCK FOR USE BY

                         THE SANITATION DEPARTMENT, AS REFLECTED

                         BY BIDS RECEIVED AND TO ENTER INTO

                         CONTRACT FOR SAID TRUCK AND OTHER

                         MATTERS WITH RESPECT THERETO.

                         The President called for any discussion.  There being no other discussion, a vote was called and the following recorded:

YEAS:                Fowler, Gibson, Villard, Jones, Silver, Johnson, Larvadain.

NAYS:                None.

ABSENT:           None.

The ordinance was thereupon declared adopted on this the 13^th day of December, 2011.

The following ordinance which was previously introduced and laid over for publication of notice and no objection having been filed there to was brought up for final adoption on motion of Ms. Gibson and seconded by Mr. Larvadain, to wit:

                                       ORDINANCE NO.    188-2011

                         AN ORDINANCE AUTHORIZING THE MAYOR

                         TO ACCEPT THE LOW BID SUBMITTED FOR

                         THREE 20” ECCENTRIC PLUG VALVES WITH

                         GEARED ACTUATORS FOR THE WASTE-

                         WATER DEPARTMENT, AS REFLECTED BY

                         BIDS RECEIVED AND TO ENTER INTO

                         CONTRACT FOR SAID ACTUATORS AND

                         OTHER MATTERS WITH RESPECT THERETO.

                         The President called for any discussion.  There being no other discussion, a vote was called and the following recorded:

YEAS:                Gibson, Villard, Jones, Silver, Johnson, Larvadain, Fowler.

NAYS:                None.

ABSENT:           None.

The ordinance was thereupon declared adopted on this the 13^th day of December, 2011.

The following ordinance which was previously introduced and laid over for publication of notice and no objection having been filed there to was brought up for final adoption on motion of Mr. Fowler and seconded by Ms. Gibson, to wit:

                                       ORDINANCE NO.    189-2011

                         AN ORDINANCE AUTHORIZING THE MAYOR

                         TO ACCEPT THE LOW BID SUBMITTED FOR

                         OPERATING CHEMICALS FOR THE WASTE-

                         WATER DEPARTMENT, AS REFLECTED BY

                         BIDS RECEIVED AND TO ENTER INTO

                         CONTRACT FOR SAID CHEMICALS AND

                         OTHER MATTERS WITH RESPECT THERETO.

                         The President called for any discussion.  There being no other discussion, a vote was called and the following recorded:

YEAS:                Fowler, Gibson, Villard, Jones, Silver, Johnson, Larvadain.

NAYS:                None.

ABSENT:           None.

The ordinance was thereupon declared adopted on this the 13^th day of December, 2011.

The following ordinance which was previously introduced and laid over for publication of notice and no objection having been filed there to was brought up for final adoption on motion of Mr. Fowler and seconded by Ms. Gibson, to wit:

                                       ORDINANCE NO.    190-2011

                         AN ORDINANCE AUTHORIZING THE MAYOR

                         TO ENTER INTO A PROFESSIONAL SERVICE

                         AGREEMENT WITH DPS-FINANCIAL

                         RESOURCES & SOLUTIONS FOR BOOK-

                         KEEPING AND TAX SERVICES FOR THE

                         ALEXANDRIA FESTIVAL ASSOCIATION AND

                         OTHER MATTERS WITH RESPECT THERETO.

                         The President called for any discussion.  There being no other discussion, a vote was called and the following recorded:

YEAS:                Fowler, Gibson, Villard, Jones, Silver, Johnson, Larvadain.

NAYS:                None.

ABSENT:           None.

The ordinance was thereupon declared adopted on this the 13^th day of December, 2011.

The following ordinance which was previously introduced and laid over for publication of notice and no objection having been filed there to was brought up for final adoption on motion of Ms. Gibson and seconded by Mr. Villard, to wit:

                                       ORDINANCE NO.    191-2011

                         AN ORDINANCE AUTHORIZING SUPPLEMENTAL

                         AGREEMENT NO. 2 FOR ENGINEERING AND

                         LAND SURVEYING SERVICES FOR REVITALIZA-

                         TION OF MASONIC DRIVE CORRIDOR, PHASE

                         3 AND OTHER MATTERS WITH RESPECT

                         THERETO.

                         The President called for any discussion.  There being no other discussion, a vote was called and the following recorded:

YEAS:                Gibson, Villard, Jones, Silver, Johnson, Larvadain.

NAYS:                None.

ABSENT:           None.

ABSTAIN:  Fowler.

The ordinance was thereupon declared adopted on this the 13^th day of December, 2011.

PUBLIC WORKS/ZONING COMMITTEE

The following ordinance which was previously introduced and laid over for publication of notice and no objection having been filed there to was brought up for final adoption on motion of Mr. Fowler and seconded by Mr. Villard, to wit:

                                       ORDINANCE NO.    192-2011

                         AN ORDINANCE AUTHORIZING THE DE-

                         ANNEXATION OF 7.97 ACRES OF LAND

                         LOCATED NORTH OF AIRBASE ROAD

                         INTERCHANGE ON OLD BOYCE ROAD

                         AND OTHER MATTERS WITH RESPECT

                         THERETO.

                         The President called for any discussion.  The Public Works/Zoning committee recommended approval of this item.  There being no other discussion, a vote was called and the following recorded:

YEAS:                Fowler, Gibson, Villard, Jones, Silver, Johnson, Larvadain.

NAYS:                None.

ABSENT:           None.

The ordinance was thereupon declared adopted on this the 13^th day of December, 2011.

FINANCE COMMITTEE

The following ordinance which was previously introduced at a regular meeting of the Council of the City of Alexandria, State of Louisiana on November 29, 2011, and laid over for publication of notice, was brought up for final passage on motion made by Mr. Chuck Fowler and seconded by Ms. Mitzi Gibson:

                                                  BOND ORDINANCE NO.   193-2011

An ordinance authorizing the issuance of Four Million Five Hundred Fifty Thousand Dollars ($4,550,000) of Utilities Revenue Bonds (DEQ), Series 2012, in one or more series, prescribing the form, terms and conditions of said Bonds; designating the date, denomination and place of payment of said Bonds; providing for the payment thereof in principal and interest; awarding said Bonds to the purchaser thereof; authorizing the execution of a Loan and Pledge Agreement and other loan documents with the Louisiana Department of Environmental Quality (the “Department”); providing for the sale and delivery of the Bonds to the Department; and providing for other matters in connection therewith.

                        WHEREAS, the United States of America, pursuant to the Clean Water Act of 1972, as amended by the Water Quality Act of 1987, specifically Subchapter VI, Chapter 26 of Title 33 of the United States Code (the “Clean Water Federal Act”), is authorized to make capitalization grants to states to be used for the purpose of establishing a water pollution control revolving fund for providing assistance (i) for construction of treatment works (as defined in Section 1292 of the Federal Act) which are publicly owned, (ii) for implementing a management program under Section 1329 of the Clean Water Federal Act and (iii) for developing and implementing a conservation and management plan under Section 1330 of the Clean Water Federal Act; and

            WHEREAS, in order to be eligible to receive such capitalization grants, a state must establish a water pollution control revolving loan fund to be administered by an instrumentality of the state with such powers and limitations as may be required to operate such fund in accordance with the requirements and objectives of the Clean Water Federal Act; and

            WHEREAS, the State of Louisiana (the “State”), pursuant to Chapter 14 of Title 30 of the Louisiana Revised Statues of 1950, as amended, specifically La. R.S. 30:2301, et seq. (the “State Revolving Fund State Act”), has established a Clean Water State Revolving Fund in the custody of the Louisiana Department of Environmental Quality (the “State Revolving Fund”) to be used for the purpose of providing financial assistance for the improvement of wastewater treatment facilities in the State, as more fully described in Section 2302 of the State Revolving Fund State Act, and has authorized said Department (the “Department”) to administer the State Revolving Fund in accordance with applicable federal and state law; and

                        WHEREAS, the City of Alexandria, State of Louisiana (the “Issuer”)  now owns and operates a combined electric power and light plant system, waterworks plant system, natural gas system and sewer system (collectively, the “System”) as a revenue producing work of public improvement, and desires to construct and acquire additions, extensions and improvements to the sewer portion of the System(the “Project”), and to finance the cost thereof through the issuance of Utilities Revenue Bonds of the Issuer, payable solely from the Net Revenues of the System as set forth herein; and

                        WHEREAS, pursuant to Part XIII, Chapter 4, Title 39 of the Louisiana Revised Statutes of 1950, as amended (the “Act”), it is now the desire of the Issuer to authorize the issuance of not exceeding Four Million Five Hundred Fifty Thousand Dollars ($4,550,000) of Utilities Revenue Bonds, Series 2012, in one or more series, of the Issuer (the “Bonds”), the Bonds to be secured by and payable in principal and interest, if any, from an irrevocable pledge and dedication of the income and revenues derived or to be derived by the Issuer from the operation of the System, after paying the reasonable and necessary expenses of administration, operation and maintenance of the System.  The Bonds shall not be a charge on the other income and revenues of the City as prohibited under the provisions of Article VI, Section 37 of the Louisiana Constitution of 1974, nor shall they constitute an indebtedness or pledge of the general credit of the City; and

                        WHEREAS,  in accordance with Section 1383(g) of the Federal Act, the Department has established a priority list under Section 1296 of the Federal Act, and the Project is on such list; and the Department has approved the Issuer's application for a loan from the State Revolving Fund to finance the Project; and

WHEREAS, the Issuer now has outstanding the following described bonds payable from a pledge and dedication of the income and revenues of the System:

                        $1,010,000 Utilities Revenue Refunding Bonds, Series 2003, maturing on May 1^st of the years 2012 to 2013, inclusive (the “Outstanding Prior Lien Bonds”);

                        $27,710,000 Utilities Revenue Bonds, Series 2004, maturing on May 1^st of the years 2012 to 2033, inclusive (the “2004 Bonds”);

                        $3,256,000 Utilities Revenue Bonds, Series 2010B, maturing on May 1^st of the years 2012 to 2030, inclusive (the “2010B Bonds”);

                        $5,610,000 Utilities Revenue Bonds, Series 2011, maturing on May 1^st of the years 2013 to 2032, inclusive (the “2011 Bonds,” and together with the 2004 Bonds, the 2010B Bonds and any other bonds that may be issued by the City prior to the delivery of the Bonds and payable from a pledge and dedication of the income and revenues of the System, the “Outstanding Parity Bonds”); and

WHEREAS, pursuant to the authority of the Act, and other constitutional and statutory authority, the Issuer gave notice of its intention to issue Utilities Revenue Bonds in an amount not exceeding $18,000,000 without the necessity of the holding of an election thereon, held a public hearing thereon on September 22, 2009, and no objections were made to the issuance of such bonds and no petitions were filed requesting an election thereon; and

WHEREAS, the Bonds are to be secured by and payable in principal and interest together with the Outstanding Prior Lien Bonds and Outstanding Parity Bonds, solely from the net revenues derived or to be derived from the operation of the System, pursuant to the provisions of the Act, as hereinafter provided, and the Issuer has made application to the Department for a loan from the State Revolving Fund to finance a portion of the costs of the Project; and

WHEREAS, to represent the loans from the State Revolving Fund in an aggregate principal amount of Four Million Five Hundred Fifty Thousand Dollars ($4,550,000), it is now the desire of this Governing Authority to fix the details necessary with respect to the issuance of all or a portion of the Bonds and provide for the authorization and issuance thereof;

NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Alexandria, State of Louisiana, acting as the governing authority thereof, that:

                                                                      ARTICLE I

                                                                   DEFINITIONS

Section 1.1. Definitions.  The following terms as used in this Authorizing Ordinance shall have the following respective meanings, such definitions to be equally applicable to both the singular and plural sense of any of such terms:

“Act” means Part XIII, Chapter 4, Title 39 of the Louisiana Revised Statutes of 1950, as amended, and other constitutional and statutory authority, including Chapter 14 of Title 30 of the Louisiana Revised Statutes of 1950, as amended, specifically R.S. 30:2301 et seq.

“Additional Parity Bonds” means any additional pari passu bonds which may hereafter be issued pursuant to Section 6.1 hereof on a parity with the Bonds.

“Additional Parity Bond Ordinance” means any ordinance adopted by the governing authority of the Issuer authorizing the issuance of the Additional Parity Bonds.

“Administrative Fee” means the annual fee equal to one-half of one percent (0.50%) per annum of the outstanding principal amount of the Bonds, or such lesser amount as the Department may approve from time to time, which shall be payable each year in two equal semi-annual installments on each Interest Payment Date.

“Bonds” means the Utilities Revenue Bonds (DEQ), Series 2012, of the City of Alexandria, State of Louisiana, authorized to be issued in one or more series by this Authorizing Ordinance in the total aggregate principal amount of Four Million Five Hundred Fifty Thousand Dollars ($4,550,000), whether initially delivered or issued in exchange for, upon transfer of, or in lieu of any previously issued Bond.

“Bond Register” means the registration books of the Paying Agent (initially the Clerk of the Issuer), in which registration of the ownership of the Bonds and the transfers of the Bonds shall be made as provided herein.

“Bond Year” means the one-year period ending on each Principal Payment Date.

“Code” means the Internal Revenue Code of 1986, as the same may be amended and supplemented from time to time, including any regulations promulgated thereunder or any administrative or judicial interpretations thereof.

“Completion Date” means the earlier of (i) the date of the final disbursement of the purchase price of a series of Bonds to the Issuer, or (ii) the date the operation of the Project is initiated or capable of being initiated, as certified by an Authorized Officer in accordance with the Loan Agreement.

“Consulting Engineer” or “Engineer” means a nationally known consulting utility engineer or firm of consulting utility engineers with skill and experience in the construction and operation of publicly- owned utilities properties.

“Costs of the Project” means, with reference to the Project, all capital costs incurred or to be incurred for the Project, including but not limited to (a) engineering, financing, legal and other fees and expenses related to the issuance of the Bonds, (b) acquisition and construction costs of the Project, (c) interest on the Bonds during construction, if specifically approved by the Department, and (d) a reasonable allowance for contingencies, all to the extent permitted by the Federal Act, the State Act and any rules or regulations promulgated thereunder.

“Defeasance Obligations” means cash and/or Government Securities.

“Delivery Date” means, for each series of Bonds, the date on which such Bonds are delivered to the Department, and the first installment of the purchase price therefor is paid by the Department to the Issuer.

“Department” means the Louisiana Department of Environmental Quality, an executive department and agency of the State of Louisiana, and any successor to the duties and functions thereof.

“Depreciation and Contingencies Fund” or “Capital Additions and Contingencies Fund” means the bond or account described in Section 5.2 hereof.

“Executive Officers” means collectively, the Mayor and the Clerk of the Issuer.

                        “Federal Act” or  “Clean Water Federal Act” means the Clean Water Act of 1972, as amended by the Water Quality Act of 1987, specifically Subchapter VI, Chapter 26 of Title 33 of the United States Code, and other statutory and regulatory authority amendatory or supplemental thereto.

“Fiscal Year” means the one year period beginning on May 1 and ending on April 30 of the following year, or such other one-year period as may be selected by the Issuer.

“Governing Authority” means the City Council of the Issuer, or its predecessor or successor in function.

“Government Securities” means and includes non-callable direct general obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United State of America, which may be United States Treasury Obligations such as the State and Local Government Series and may be in book-entry form.

“Interest Payment Date” means May 1 and November 1 on each year in which interest on the Bonds is payable, the first of which shall occur after the delivery of the Bonds to the Department and which shall occur semi-annually thereafter until the Bonds are paid in full.

“Issuer” means the City of Alexandria, State of Louisiana.

“Loan Agreement” means the Loan and Pledge Agreement to be entered into by and between the Department and the Issuer prior to the delivery of each series of Bonds which will contain certain additional agreements relating to such series of Bonds and the Project, which Loan Agreement shall be in substantially the form attached as Exhibit B to this Ordinance, as it may be supplemented or amended from time to time in accordance with the provisions thereof.

“Net Revenues” means the income and revenues to be derived from the operation of the System, after provision has been made for payment therefrom of the reasonable and necessary expenses of administration, operation and maintenance of the System.

“Ordinance” means this Ordinance authorizing the issuance of the Bonds, as hereafter amended or supplemented.

“Outstanding” when used with respect to Bonds, as of the date of determination, means all bonds theretofore issued and delivered under the Ordinance except:

(a)        Bonds that have been cancelled or delivered to the Registrar for cancellation;

(b)        Bonds that have been defeased in accordance with Section 11.1 hereof;

(c)        Bonds in exchange for or in lieu of which other Bonds have been registered and delivered pursuant to the Ordinance; or

(d)        Bonds alleged to have been mutilated, destroyed, lost or stolen which have been paid as provided in the Ordinance or by law.

“Outstanding Parity Bonds” means, collectively, the Issuer=s outstanding Utilities Revenue Bonds, Series 2004, Utilities Revenue Bonds, Series 2010B, and Utilities Revenue Bonds, Series 2011, as more fully described in the preamble hereto, and any other bonds that may be issued by the City prior to the delivery of the Bonds and payable from a pledge of the income and revenues of the System.

“Outstanding Parity Bond Ordinance” means, collectively, the ordinances adopted by the governing authority of the Issuer on December 9, 2003, January 12, 2010, June 14, 2011, and November 11, 2011, authorizing the issuance of the Outstanding Parity Bonds.

“Outstanding Prior Lien Bonds” means the Issuer=s outstanding Utilities Revenue Refunding Bonds, Series 2003, as more fully described in the preamble hereto.

“Outstanding Prior Lien Bond Ordinance” means the ordinance adopted by the governing authority of the Issuer on March 5, 2003, authorizing the issuance of the Outstanding Prior Lien Bonds.

“Owner” or “Owners” when used with respect to any Bond, means the Person in whose name such Bond is registered in the Bond Register.

“Parity Obligations” means any additional pari passu indebtedness hereafter issued by the Issuer and payable from the Net Revenues on a parity with the Outstanding Parity Bonds and the Bonds.

“Person” means any individual, corporation, partnership, joint venture, association, joint‑stock company, trust, unincorporated organization, or government or any agency or political subdivision thereof.

“Principal Payment Date” means each annual payment date of principal of the Bond (May 1), with the first payment date to be not later than one year after the completion of the Project and the final payment date to fall not exceeding nineteen years from the first principal payment date thereafter for a total of twenty (20) consecutive annual payment dates, providing that in no event shall the final maturity of the Bonds be more than twenty-two (22) years from the Delivery Date.

“Project” means the acquisition and construction of additions, extensions and replacements to the sewer portion of the System, including appurtenant equipment, accessories and properties, both personal and real, being financed by the sale of the Bonds to the Department.

“Registrar” means the person designated in this Ordinance, unless and until a successor Registrar shall have assumed such responsibilities pursuant to this Ordinance, and thereafter “Registrar” shall mean such successor Registrar.

“Reserve Fund Requirement” means, as of any date of calculation, the lesser of (i) an amount equal to 10% of the proceeds of the Bonds, the Outstanding Parity Bonds and any issue of Additional Parity Bonds, (ii) an amount equal to the highest combined principal and interest requirements for any succeeding Fiscal Year on the Bonds, the Outstanding Parity Bonds and any issue of Additional Parity Bonds or (iii) 125% of the average aggregate amount of principal installments and interest becoming due in any Fiscal Year on the Bonds, the Outstanding Parity Bonds and any Additional Parity Bonds. 

“Scheduled Completion Date” is the date designated as such in accordance with the provisions of the Loan Agreement, regardless of whether or not such date precedes or follows the Completion Date.

“State” means the State of Louisiana.

“State Revolving Fund” has the meaning given in the preamble to this Ordinance.

“System” or “Utilities System” means the combined electric power and light plant and system, waterworks plant and system, natural gas system and sewer system, as said plants and systems now exist and as they may be hereafter improved, extended or supplemented while any of the Bonds remain outstanding, including specifically all properties of every nature owned, leased or operated by the Issuer and used or useful in the operation of said plants and systems, and including real estate, personal and intangible properties, contracts, franchises, leases and choses in action, whether lying within or without the boundaries of the Issuer.

“User Fees” means charges or fees levied on users of the System for the cost of operation, maintenance and replacement of the System, for the repayment of debt incurred with respect to the System and for such other purposes as may be determined by the Governing Authority from time to time.

“Utilities System Fund” means the fund of such name established pursuant to the Outstanding Parity Bond Ordinance.

Section 1.2.     Interpretation.  In this Ordinance, unless the context otherwise requires, (a) words importing the singular include the plural and vice versa, (b) words of the masculine gender shall be deemed and construed to include correla­tive words of the feminine and neuter genders and (c) the title of the offices used in this Ordinance shall be deemed to include any other title by which such office shall be known under any subse­quently adopted charter.

                                                                      ARTICLE II

                                                                    THE BONDS

Section 2.1.     Authorization of Bonds.  This Ordinance creates one or more series of Bonds of the Issuer to be designated “Utilities Revenue Bonds (DEQ), Series 2012, of the City of Alexandria, State of Louisiana,” (provided that if the Bonds are delivered in a calendar year other than 2012, the series designation shall change accordingly) and provides for the full and final payment of the principal or prepayment price of and interest thereon.  The Bonds shall be issued for the purpose of paying the cost of constructing, acquiring, extending and/or improving the sewer portion of the System.

Section 2.2.     Ordinance to Constitute Contract.  In consideration of the purchase and acceptance of the Bonds by those who shall own the same from time to time, the provisions of this Ordinance shall be a part of the contract of the Issuer with the Owners and shall be deemed to be and shall constitute a contract between the Issuer and the Owners from time to time of the Bonds.

Section 2.3.     Obligation of Bonds.  The Bonds, equally with the Outstanding Parity Bonds, shall be payable as to both principal and interest solely from the Net Revenues to be derived from the operation of the System, pursuant to the Constitution and laws of the State of Louisiana, after provision has been made for payment therefrom of the reasonable and necessary expenses of administration, operation and maintenance of the System and after provision has been made for the payments required by the Outstanding Prior Lien Bonds.  The Net Revenues are hereby irrevocably and irrepealably pledged and dedicated in an amount sufficient for the payment of the Bonds, the Outstanding Parity Bonds and the Outstanding Prior Lien Bonds, in principal, and interest as they shall respectively become due and payable, and for the other purposes hereinafter set forth in this Ordinance.  All of the Net Revenues shall be set aside in a separate fund, as hereinafter provided, and shall be and remain pledged for the security and payment of the Bonds, the Outstanding Parity Bonds and the Outstanding Prior Lien Bonds and any Parity Obligations, in principal, and interest and for all other payments provided for in this Ordinance until such bonds shall have been fully paid and discharged.

Section 2.4.     Authorization of Bonds; Maturities.  In compliance with and under the authority of the Act, and other constitutional and statutory authority, including the State Act, there is hereby authorized the incurring of an indebtedness of Four Million Five Hundred Fifty Thousand Dollars ($4,550,000) for, on behalf of and in the name of the Issuer, for the purposes set forth above, and to represent the indebtedness, this Governing Authority does hereby authorize the issuance of Four Million Five Hundred Fifty Thousand Dollars ($4,550,000) of Utilities Revenue Bonds (DEQ), Series 2012, of the Issuer in one or more series. The Bonds shall be initially issued in the form of a single fully registered Bond numbered R-1 (or if in series as hereinafter provided, a single fully registered bond for each series, appropriately designated), shall be dated the date of delivery thereof and shall be in substantially the form attached hereto as Exhibit A.

The Bonds shall mature in twenty (20) installments of principal, payable annually on the Principal Payment Dates in compliance with the requirements of the Federal Act and the State Act that the first repayment of principal be not more than one year after the Completion Date.  In no event shall the final maturity of the Bonds be more than twenty-two (22) years from their Delivery Date. 

The amount and dates of the principal installments of the Bonds shall be determined as of their Delivery Date by the Executive Officers, in integral multiples of One Thousand Dollars ($1,000), so that the combined annual principal, interest and Administrative Fee on each series of the Bonds from and after the Scheduled Completion Date for such series shall be approximately equal.  In the event that less than the authorized principal amount of a series of Bonds is purchased, then upon the payment of the final installment of the purchase price of such Bonds the schedule of principal payments shall be recalculated so that the actual amount of principal, interest and Administrative Fee due in each Bond Year are approximately equal and, to the extent feasible, the principal installments are in integral multiples of One Thousand Dollars ($1,000).

The unpaid principal of the Bonds shall bear interest from the date thereof, or the most recent Interest Payment Date to which interest has been paid or duly provided for, at the rate of forty-five hundredths percent (0.45%) per annum, said interest to be calculated on the basis of a 360-day year consisting of twelve thirty-day months and payable on each Interest Payment Date.  Interest on the Bonds on any Interest Payment Date shall be payable only on the aggregate amount of the purchase price which shall have been paid theretofore to the Issuer and is outstanding and shall accrue with respect to each purchase price installment only from the date of payment of such installment.

In addition to interest at the rate set forth above, at any time that the Department owns the Bonds the Issuer will pay the Administrative Fee to the Department on each Interest Payment Date.  In the event (i) the Department owns any Bonds or the Department has pledged or assigned any Bonds in connection with its State Revolving Fund and (ii) the Administrative Fee payable by the Issuer to the Department under the terms of the Loan Agreement is declared illegal or unenforceable by a court or an administrative body of competent jurisdiction, the interest rate borne by the Bonds shall be increased by one-half of one percent (0.50%) per annum, effective as of the date declared to be the date from which the Administrative Fee is no longer owed because of such illegality or unenforceability.

Section 2.5.     Issuance of Bonds on a Parity with the Outstanding Parity Bonds.  The Bonds are hereby issued on a parity with the Outstanding Parity Bonds, and the Bonds shall rank equally with and shall enjoy complete parity of lien with the Outstanding Parity Bonds on the Net Revenues and the funds established and maintained in connection with the Bonds and the Outstanding Parity Bonds.  This Governing Authority does hereby find, determine and declare that the Issuer has complied, or will comply prior to the delivery of the Bonds, with all of the terms and conditions (or such terms and conditions shall have been waived by the owner of the Outstanding Parity Bonds) set forth in the Outstanding Parity Bond Ordinance with respect to authorizing the issuance of the Bonds on a parity with the Outstanding Parity Bonds.

Section 2.6.     Manner of Payment.  The principal and interest on the Bonds will be payable by check mailed to the Owner (determined as of the Interest Payment Date) at the address shown on the registration books kept by the Registrar for such purpose, provided that payment of the final installment of principal on the Bonds shall be made only upon presentation and surrender of the Bonds to the Registrar.

Section 2.7.     Registration.  The Issuer shall cause the Bond Register to be kept at the principal office of the Registrar (initially the Clerk of the Issuer) in which registration of the Bonds and transfers of the Bonds shall be made as provided herein.  The Bonds may be transferred, registered and assigned only on the Bond Register of the Registrar, and such registration shall be at the expense of the Issuer.  The Bonds may be assigned by the execution of an assignment form on the Bonds or by other instruments of transfer and assignment acceptable to the Registrar.  A new Bond will be delivered by the Registrar to the last assignee (the new Owner) in exchange for such transferred and assigned Bond after receipt of the Bond to be transferred in proper form.

Section 2.8.     Regularity of Proceedings. The Issuer, having investigated the regularity of the proceedings had in connection with the issuance of the Bonds, and having determined the same to be regular, each of the Bonds shall contain the following recital, to‑wit: 

“It is certified that this bond is authorized by and is issued in confor­mity with the requirements of the Constitution and statutes of this State.”

Section 2.9.     Execution of Bonds and Documents.  The Executive Officers are hereby empowered, authorized and directed to do any and all things necessary and incidental to carry out all of the provisions of this Ordinance, to execute and deliver the Loan Agreement, to cause the necessary Bonds to be printed, to issue, execute and seal the Bonds and to effect delivery thereof as hereinafter provided.  If facsimile signatures are used on the Bonds, then such signatures shall be registered with the Louisiana Secretary of State in the manner required by La. R.S. 39:244.

In connection with the issuance and sale of the Bonds, the Executive Officers are each authorized, empowered and directed to execute on behalf of the Issuer such additional documents, certificates and instruments as they may deem necessary, upon the advice of bond counsel, to effect the transactions contemplated by this Ordinance, the signatures of said persons on such documents, certificates and instruments to be conclusive evidence of the due exercise of the authority granted hereunder.

Section 2.10.   Sale and Delivery of Bonds.  The Bonds are hereby awarded to and sold to the Department at a price of par plus accrued interest, if any, under the terms and conditions set forth in the Loan Agreement, and after their execution and authentication by the Registrar, the Bonds shall be delivered to the Department or its agents or assigns, upon receipt by the Issuer of the agreed first advance of the purchase price of the Bonds.  It is understood that the purchase price of the Bonds will be paid by the Department to the Issuer in installments, in the manner and under the terms and conditions set forth in the Loan Agreement.

Section 2.11.   Bonds Mutilated, Destroyed, Stolen or Lost.  In case any Bond shall become mutilated or be improperly cancelled, or be destroyed, stolen or lost, the Issuer may in its discretion adopt a resolution or ordinance and thereby authorize the issuance and delivery of a new Bond in exchange for and substitution for such mutilated or improperly cancelled Bond, or in lieu of and substitution for the Bond destroyed, stolen or lost, upon the Owner (i) furnishing the Issuer and the Paying Agent proof of his ownership thereof and proof of such mutilation, improper cancellation, destruction, theft or loss satisfactory to the Issuer and the Paying Agent, (ii) giving to the Issuer and the Paying Agent an indemnity bond in favor of the Issuer and the Paying Agent in such amount as the Issuer may require, (iii) complying with such other reasonable regulations and conditions as the Issuer may prescribe and (iv) paying such expenses as the Issuer and the Paying Agent may incur.  All Bonds so surrendered shall be delivered to the Paying Agent for cancellation pursuant to Section 2.13 hereof.  If any Bond shall have matured or be about to mature, instead of issuing a substitute Bond, the Issuer may pay the same, upon being indemnified as aforesaid, and if such Bond be lost, stolen or destroyed, without surrender thereof.

Any such duplicate Bond issued pursuant to this Section shall constitute an original, additional, contractual obligation on the part of the Issuer, whether or not the lost, stolen or destroyed Bond be at any time found by anyone.  Such duplicate Bond shall be in all respects identical with those replaced except that it shall bear on its face the following additional clause:

“This bond is issued to replace a lost, cancelled or destroyed bond under the

authority of R.S. 39:971 through 39:974.”

Such duplicate bond may be signed by the facsimile signatures of the same officers who signed the original Bonds, provided, however, that in the event the officers who executed the original Bonds are no longer in office, then the new Bonds may be signed by the officers then in office.  Such duplicate Bonds shall be entitled to equal and proportionate benefits and rights as to lien and source and security for payment as provided herein with respect to all other Bonds hereunder, the obligations of the Issuer upon the duplicate Bonds being identical to its obligations upon the original Bonds and the rights of the Owner of the duplicate Bonds being the same as those conferred by the original Bonds.

Section 2.12.   Preparation of Definitive Bonds; Temporary Bonds.  Until the definitive Bonds are prepared, the Issuer may execute, in the same manner as is provided in Section 2.13, and deliver, in lieu of definitive Bonds, but subject to the same provisions, limitations and conditions as the definitive Bonds except as to the denominations, one or more temporary typewritten Bonds substantially of the tenor of the definitive Bonds in lieu of which such temporary Bond or Bonds are issued, in authorized denominations, and with such omissions, insertions and variations as may be appropriate to temporary Bonds.

Section 2.13.   Cancellation of Bonds.   All Bonds paid or redeemed either at or before maturity, together with all bonds purchased by the Issuer, shall thereupon be promptly cancelled by the Paying Agent.  The Paying Agent shall thereupon promptly furnish to the City Clerk of the Issuer an appropriate certificate of cancellation.

                                                                     ARTICLE III

                                                         PREPAYMENT OF BONDS

                        Section 3.1.     Optional Prepayment of Bonds.  The principal installments of the Bonds are subject to prepayment by the Issuer at any time, in whole or in part, in the inverse order of maturity, at a prepayment price of par plus accrued interest and accrued Administrative Fee, if any, to the prepayment date.

Section 3.2.     Notice of Prepayment.  Official notice of such call of any of the Bonds for prepayment shall be given by means of first class mail, postage prepaid by notice deposited in the United States Mail not less than thirty (30) days prior to the prepayment date addressed to the Owner of each Bond to be prepaid at his address as shown on the registration records of the Registrar.  In the event a portion of the Bonds is to be prepaid, such Bonds shall be surrendered to the Registrar, who shall note the date and amount of such prepayment in the space provided therefor on the Bonds.

                                                                     ARTICLE IV

                                                 APPLICATION OF BOND PROCEEDS

Section 4.1.     Issuance of Bonds; Application of Proceeds.  All of the proceeds derived from the sale of the Bonds, which shall be paid in installments by the Department in the manner set forth in the Loan Agreement, shall be deposited by the Issuer in a Construction Fund    (the “Construction Fund”).  The funds in the Construction Fund shall be used solely for the purpose of paying Costs of the Project, in the manner set forth in the Loan Agreement.

Section 4.2.     Investment of Construction Fund.  Moneys in the Construction Fund may be temporarily invested in the manner provided by Louisiana law.   Said moneys shall be sacred funds and the Owners shall have a lien thereon until said funds are paid out as provided in the Loan Agreement and this Ordinance. Any investment earnings on moneys in the Construction Fund may be retained in the Construction Fund and applied for the purposes described in this Section, or may be transferred to the Sinking Fund described in Section 5.2(b) hereof and applied to the payment of interest accruing on the Bonds during the period of construction of Project.

All moneys in the Construction Fund shall at all times be secured to the full extent thereof by the banks or trust companies holding such funds by direct obligations of the United States of America or the State of Louisiana having a market value not less than the amount of moneys then on deposit in said funds.

                                                                      ARTICLE V

                                             PAYMENT OF BONDS; FLOW OF FUNDS

Section 5.1.     Outstanding Prior Lien Bonds.  The Issuer recognizes that the Owners of the Outstanding Prior Lien Bonds have certain contractual rights with respect to the Net Revenues of the System by virtue of the provisions of the Outstanding Prior Lien Bond Ordinance.  Nothing in this Ordinance shall be construed in such a manner as to impair any rights vested in the Owners of the Outstanding Prior Lien Bonds, and if at any time it shall be established that any of the provisions of this Ordinance are in conflict with the provisions of the Outstanding Prior Lien Bond Ordinance authorizing the Outstanding Prior Lien Bonds in such manner as to impair any contractual rights vested in the Owners thereof, the provisions of the Outstanding Prior Lien Bond Ordinance shall be controlling as to such conflicts as long as the Outstanding Prior Lien Bonds are outstanding.

Section 5.2.     Funds and Accounts.  All of the income and revenues earned or derived from the operation of the System shall continue to be deposited daily as the same may be collected in the Utilities System Fund heretofore established with the regularly designated fiscal agent of the Issuer.  The Utilities System Fund shall be maintained and administered in the following order of priority and for the following express purposes:

(a)   The payment of all reasonable expenses of administration, operation and maintenance of the System, and after provision has been made for the payments required by the Outstanding Prior Lien Bonds as required by the Outstanding Prior Lien Bond Ordinance, and more specifically into the Sinking Fund, the Reserve Fund and the Capital Additions and Contingencies Fund established and maintained pursuant to said Outstanding Prior Lien Bond Ordinance.

(b)    The maintenance of the “Sinking Fund - 2004” (the “Sinking Fund”) heretofore established, sufficient in amount to pay promptly and fully the principal of and the interest on the Bonds, the Outstanding Parity Bonds and any Additional Parity Bonds issued hereafter in the manner provided by this Ordinance, as they severally become due and payable (whether at maturity or upon mandatory redemption), by transferring from the Utilities System Fund to the Sinking Fund, monthly in advance on or before the 20th day of each month of each year, a sum equal to 1/6th of the interest and Administrative Fee, if any,  falling due on the next Interest Payment Date, and a sum equal to 1/12th of the principal falling due on the next principal payment date, together with such additional proportionate sum as may be required to pay said principal and interest as the same respectively become due; provided, however, that upon the issuance of the Bonds, the amount to be so credited each month until the first Interest Payment Date and first principal payment date of said Bonds shall be adjusted to reflect the actual interval to such first Interest Payment Date and the interval to such first principal payment date, and provided further, that when making the computations for any of the purposes of this subparagraph (b), allowance should be made for accrued interest on the Bonds credited to the Sinking Fund upon the delivery of the Bonds.  The depository for the Sinking Fund shall transfer from said Sinking Fund to the paying agent bank or banks for all Bonds payable from said Fund at least one (1) day in advance of each Interest Payment Date funds fully sufficient to pay promptly the principal and interest so falling due on such date.

                        (c)    The maintenance of the “Reserve Fund - 2004” (the “Reserve Fund”) heretofore established.  On and after the Delivery Date, the Issuer shall transfer from the Utilities System Fund to the Reserve Fund, on each payment date of a portion of the purchase price of the Bonds by the Department, an amount which will increase the amount on deposit in the Reserve Fund to the Reserve Fund Requirement as of such date (taking into account the prior funding of the Reserve Fund Requirement with respect to the Outstanding Parity Bonds).  Moneys in the Reserve Fund shall be used solely for transfer to the Sinking Fund in amounts required to prevent any default in the payment of the principal of and interest on the Bonds and the Outstanding Parity Bonds and, at the option of the Issuer, for payment of the final principal and interest requirements of the Bonds and the Outstanding Parity Bonds.

Whenever the amount in the Reserve Fund, together with the amount in the Sinking Fund, is sufficient to pay in full all outstanding Bonds and Outstanding Parity Bonds and Additional Bonds in accordance with their terms (including principal and interest thereon), the funds on deposit in the Reserve Fund shall be transferred to the Sinking Fund and shall be available to pay all outstanding Bonds and Outstanding Parity Bonds and Additional Bonds in accordance with their terms (including principal and interest thereon).  Prior to said transfer, all investments held in the Reserve Fund shall be liquidated to the extent necessary in order to provide for the timely payment of principal and interest on the Bonds and Outstanding Parity Bonds and Additional Bonds.

With the prior written consent of the Department, in lieu of the required transfers to the Reserve Fund or to provide for the removal of all or a portion of the amounts on deposit in the Reserve Fund, the Issuer may cause to be deposited into the Reserve Fund a surety bond or an insurance policy for the benefit of the holders of the Bonds or a letter of credit in an amount equal to (i) the difference between the Reserve Fund Requireme­nt and the sums then on deposit in the Reserve Fund, if any or (ii) the Reserve Fund  Requirement.  The surety bond, insurance policy or letter of credit shall be payable (upon the giving of notice as required thereunder) on any due date on which moneys will be required to be withdrawn from the Reserve Fund and applied to the payment of principal of or interest on any Bonds when such withdrawal cannot be met by amounts on deposit in the Sinking Fund or the Reserve Fund or provided from any other fund or account under this Ordinance.

In the event of the refunding of any bonds, the Issuer may withdraw from the Reserve Fund all, or any portion of, the amounts accumulated therein with respect to the Bonds being refunded and deposit such amounts to be held for the payment of the principal or redemption premium, if applicable and interest on the bonds being refunded; provided that such withdrawal shall not be made unless (i) immediately thereafter the bonds being refunded shall be deemed to have been paid pursuant to Section 11.1 and (ii) the amount remaining in the Reserve Fund, after giving effect to the issuance of the Refunding Bonds and the disposition of the proceeds thereof, shall not be less than the Reserve Fund Requirement.

In the event that Additional Parity Bonds are issued hereafter in the manner provided by this Ordinance, there shall be immediately transferred from the proceeds of such Additional Parity Bonds and/or from the Utilities System Fund into the Reserve Fund such amount (as may be designated in the ordinance authorizing the issuance of such Additional Parity Bonds) as will increase the total amount on deposit in the Reserve Fund to a sum equal to the Reserve Fund Requirement for all outstanding bonds payable from the Sinking Fund and any such Additional Parity Bonds; provided, however, that in the event of the issuance of Additional Parity Bonds, the Reserve Fund Requirement may be satisfied by cash or additional funding instrument, or any combination thereof.

If at any time it shall be necessary to use moneys in the Reserve Fund for the purpose of paying principal or interest on bonds payable from the Sinking Fund as to which there would otherwise be default, then the moneys so used or drawn upon shall be replaced or reimbursed from the Net Revenues of the System first thereafter received, not hereinabove required for payments into the Sinking Fund, it being the intention hereof that there shall as nearly as possible be at all times in the Reserve Fund the Reserve Fund Requirement.

(d)    Upon retirement in full of the Outstanding Prior Lien Bonds, the continued  maintenance of the Capital Additions and Contingencies Fund previously established with respect to the Outstanding Prior Lien Bonds, to care for extensions, additions, improvements, renewals and replacements necessary to properly operate the System by transferring from said Utilities System Fund to the Capital Additions and Contingencies Fund, monthly on or before the 20th day of each month of each year, a sum equal to nine percent (9%) of the gross revenues of the System for the preceding month, provided that such sum is available after provision is made for the payments required under paragraphs (a), (b), and (c) above.  Such payments into the Capital Additions and Contingencies Fund shall continue until such time as there has been accumulated therein the sum of One Million Dollars ($1,000,000), whereupon such payments may cease and need be resumed thereafter only if the total amount of money on deposit therein is reduced below the sum of One Million Dollars ($1,000,000), in which event such payments shall be resumed and continue until said maximum of One Million Dollars ($1,000,000) is again accumulated.  In addition to caring for extensions, additions, improvements, renewals and replacements necessary to properly operate the System, the money in the Capital Additions and Contingencies Fund may also be used to pay the principal of and the interest on the Bonds and the Outstanding Parity Bonds,  including any Additional Parity Bonds, for the payment of which there is not sufficient money in the Sinking Fund and Reserve Fund described in paragraphs (b) and (c) above, but the money in said Capital Additions and Contingencies Fund shall never be used for the making of improvements and extensions to the System or for payment of principal or interest on bonds if the use of said money will leave in said Capital Additions and Contingencies Fund for the making of emergency repairs or replacements less than the sum of Twenty-Five Thousand Dollars ($25,000).

Any moneys remaining in said Utilities System Fund after making the above-required payments may be used by the Issuer for the purpose of calling and/or purchasing and paying any bonds payable from the revenues of the System, or for such other lawful corporate purposes as the Governing Authority may determine, whether such purposes are or are not in relation to the System.

If at any time it shall be necessary to use moneys in the Reserve Fund or the Capital Additions and Contingencies Fund above provided for the purpose of paying principal of or interest on Bonds payable from the aforesaid Sinking Fund as to which there would otherwise be default, then the moneys so used shall be replaced from the revenues first thereafter received, not hereinabove required to be used for administration, operation and maintenance of the System or for current principal, interest and reserve requirements.  If at any time there are sufficient moneys on deposit in the Reserve Fund and Capital Additions and Contingencies Fund to retire all outstanding bonds payable from the Sinking Fund by exercising the redemption option provided by such bonds or by purchase on the open market, the Issuer may utilize such funds for such purpose.

All or any part of the moneys in the Reserve Fund and the Capital Additions and Contingencies Fund shall, at the written request of the Issuer, be invested in one or both of the following if and to the extent that the same are legal for the investment of funds of the Issuer:  (a) direct obligations of the United States of America, or (b) negotiable or non-negotiable certificates of deposit issued by any bank, trust company or national banking association provided (i) such certificates of deposit are continuously and at all times secured by direct general obligations of the United States of America having a market value (exclusive of accrued interest) at all times at least equal to the principal amount of such certificates of deposit, and (ii) interest is paid thereon to the extent of one hundred percent (100%).  All income derived from such investments shall be added to the money in said respective funds or to the Utilities System Fund, and such investments shall, to the extent at any time necessary, be liquidated and the proceeds thereof applied to the purpose for which the respective funds are created.

                                                                     ARTICLE VI

                                                      ADDITIONAL PARITY BONDS

Section 6.1.     Issuance of Additional Parity Bonds. All of the Bonds shall enjoy complete parity of lien on the revenues of the Utilities System despite the fact that any of the Bonds may be delivered at an earlier date than any other of the Bonds.   The Issuer covenants that it will issue no other bonds or obligations of any kind or nature payable from or enjoying a lien on the revenues of the Utilities System having priority over or parity with the Outstanding Prior Lien Bonds.  The Issuer further covenants that it will issue no other bonds or obligations of any kind or nature payable from or enjoying a lien on the revenues of the Utilities System having priority over or parity with the Bonds herein authorized or enter into any take or pay contracts or guaranteed contracts payable from revenues of the Utilities System and with a term in excess of five (5) years (“Contracts”); provided, however, that Additional Parity Bonds may hereafter be issued or Contracts may be entered into under the following conditions (provided no variable rate indebtedness may be issued on a parity with the Bonds without the consent of the insurer for the Outstanding Parity Bonds):

1.       The Bonds or any part thereof may be refunded with the consent of the Owners thereof (except that as to Bonds which are then subject to redemption and have been properly called for redemption, such consent shall not be necessary) and the refunding Bonds so issued shall enjoy complete equality of lien with the portion of the Bonds which is not refunded, if there be any, and the refunding Bonds shall continue to enjoy whatever priority of lien over subsequent issues as may have been enjoyed by the Bonds refunded, provided, however, that if only a portion of the Bonds outstanding is so refunded and if the refunding Bonds require total principal and interest payments during any Bond Year in excess of the principal and interest which would have been required in such Bond Year to pay the Bonds refunded thereby, then such Bonds may not be refunded without the consent of the Owners of the unrefunded portion of the Bonds.

2.       Additional Parity Bonds may also be issued if all of the following conditions are met:

(a)    The average annual Net Revenues for the two (2) completed Fiscal Years immediately preceding the issuance of the Additional Parity Bonds must have been not less than one and three-tenths (1.3) times the highest combined principal and interest requirements for any succeeding Fiscal Year period on all Bonds then outstanding, including any pari passu additional Bonds theretofore issued and then outstanding and any other bonds or obligations whatsoever then outstanding which are payable from the Net Revenues of the Utilities System (but not including bonds which have been refunded or provisions otherwise made for their full and complete payment and redemption), and the bonds so proposed to be issued.  In making the calculation required by this subparagraph (2)(a), if the Issuer has adopted higher rates for services rendered by the System on or before the date of issuance of the Additional Parity Bonds, the calculation of average Net Revenues for the previous two completed Fiscal Years may be made assuming such rates had been in effect during such period.

(b)    The payments required to be made into the various funds provided in this Ordinance must have been made in full.

(c)    The existence of the facts required by paragraphs (a) and (b) above must be determined and certified by the Director of Finance of the Issuer or by the independent certified public accountants who have previously audited the books of the Issuer as hereinbe­fore required, or by such successors thereof who may have been employed for that purpose.

(d)    The additional bonds must be payable as to principal on May 1st of each year in which the principal falls due and payable as to interest on May 1st and November 1st of each year.

(e)    The proceeds of the additional bonds must be used solely for the making of improvements, extensions, renewals, replacements or repairs to the Utilities System.

(f)    No Event of Default (as defined in Article X hereof) shall have occurred and be continuing.

3.       The Issuer may enter into Contracts, as defined above, provided that there shall have been delivered to the Issuer a certificate from the Consulting Engineer to the effect that, assuming that the Contract had been in effect during the most recently completed Fiscal Year, the Net Revenues for such Fiscal Year (adjusted to account for the payments to be made under such Contract and any savings which are estimated to be derived as a result of the Contract) would have been not less than 1.3 times the highest combined principal and interest requirements for any succeeding Fiscal Year period on all Bonds then outstanding, including any Additional Parity Bonds theretofore issued and then outstanding and any other bonds or obligations whatsoever then outstanding which are payable from the income and revenues of the Utilities System (but not including bonds which have been refunded or provisions otherwise made for their full and complete payment and redemption), and the payments required pursuant to the proposed Contract.

                                                                     ARTICLE VII

RATES AND CHARGES; COVENANTS AS TO THE MAINTENANCE

AND OPERATION OF THE SYSTEM

Section 7.1.     Operation of the System. The Issuer will maintain the System in good repair and operating condition and will cooperate with the Department in the observance and performance of the respective duties, covenants, obligations and agreements of the Issuer and the Department under the Loan Agreement.

Section 7.2.     Obligation to Fix Rates. The Issuer, through the Governing Authority, hereby covenants to fix, establish, maintain and collect such rates, fees, rents or other charges for the services and facilities of the System, and all parts thereof, and to revise the same from time to time whenever necessary, as will always provide revenues in each year sufficient to pay the necessary expenses of administering, operating and maintaining the System in each year, one hundred twenty percent (120%) of the principal maturing and interest and Administrative Fee, if any, due on the Bonds, the Outstanding Parity Bonds, the Outstanding Prior Lien Bonds and any Additional Parity Bonds in each year, all reserves or sinking funds or other payments required for such year by this Ordinance, the Outstanding Prior Lien Bond Ordinance, the Outstanding Parity Bond Ordinance and any Additional Parity Bond Ordinance, and all other obligations or indebtedness payable out of the revenues of the System for such year, and that such rates, fees, rents or other charges shall not at any time be reduced so as to be insufficient to provide adequate revenues for such purposes.

Section 7.3  Schedule of Rates and Charges.  Except as provided herein, nothing in this Ordinance or in the Bonds shall be construed to prevent the Issuer from altering, amending or repealing from time to time as may be necessary any resolution or ordinances setting up and establishing a schedule or schedules of rates and charges for the services and facilities to be rendered by the System, said alterations, amendments or repeals to be conditioned upon the continued preservation of the rights of the Owners with respect to the income and revenues of the System, not alone for the payment of the principal of and interest on the Bonds, but to give assurance and insure that the income and revenues of the System shall be sufficient at all times to meet and fulfill the other provisions stated and specified in Section 5.2 of this Ordinance.  It is understood and agreed, however, that the Issuer shall fix and maintain and collect rates and charges for the services and facilities to be rendered by the System, irrespective of the user thereof, that no free service shall be furnished to any person, association of persons or corporation, public or private, or even to the Issuer itself and that all water, gas and electricity shall be metered; provided, however, that the Issuer shall not be required to meter electricity used by the Issuer for street lighting purposes, nor shall the Issuer be required to meter water used for fire fighting purposes through its fire hydrants, but the Issuer pays from its general revenues a minimum annual rental of Twenty-Five Dollars ($25.00) per year for each fire hydrant connected to the System and available for fire fighting and also a minimum of two and one-half cents (224) per KWH of electricity used for street lighting, such consumption of electricity to be computed by multiplying the wattage of the street lights by 4,000 hours per year, the estimated average operating time of such lights.  It is further understood and agreed that the schedule of rates, fees, rents or other charges being charged as of the date of the adoption of this Ordinance for services and facilities rendered by the System shall remain in effect until changed in compliance with other provisions of this Ordinance.

All charges owed by any individual, partnership or corporation for electric, water, gas and sewer services rendered by the System shall be billed and collected as a unit.  Failure of any individual, partnership or corporation to pay said combined charge within fifteen (15) days of the date on which it is due shall cause such charge to become delinquent; if such delinquent charge is not paid within ten (10) days from the date on which it became delinquent, the Issuer will shut off water, gas and electric services to the affected premises; the Issuer and the Governing Authority and its officials, agents and employees will do all things necessary and will take advantage of all remedies afforded by law to collect and enforce the prompt payment of all charges made for electricity, water, gas and sewer services rendered by the System.

All delinquent charges for utilities services shall on the date of delinquency have added thereto a penalty established by the Issuer as a percentage of the amount of the charge and the amount so due, including the penalty charge, shall, after thirty (30) days from the date of delinquency, bear interest at a rate  specified by the Issuer.   If services shall be discontinued as above provided, the customer shall, in addition to paying the delinquent charges, penalties and interest, pay as a condition precedent to the resumption of service, a  reconnection charge designated by the Issuer.

Section 7.4  Pledge of Revenues.  In providing for the issuance of the Bonds herein authorized, the Issuer does hereby covenant and warrant that it is lawfully seized and possessed of the System, that it has a legal right to pledge the income and revenues therefrom as herein provided, that the Bonds will have a lien and privilege on said income and revenues subject only to the prior payment of all reasonable expenses of administration, operation and maintenance of the System, and after provision has been made for the payments required by the Outstanding Prior Lien Bonds and that the Issuer will at all times maintain the System in first class repair and working order and condition.

Section 7.5  Insurance.  So long as any of the Bonds herein authorized are outstanding and unpaid in principal or interest, the Issuer shall carry full coverage of insurance on the System at all times against those risks and in those amounts normally carried by privately owned public utility companies engaged in the operation of such utilities.  Said policies of insurance shall be issued by a responsible insurance company or companies duly licensed to do business under the laws of the State of Louisiana.  In case of loss, any insurance money received by the Issuer shall be used for the purpose of promptly repairing or replacing the property damaged or destroyed, or shall be deposited in the aforesaid Capital Additions and Contingencies Fund to supplement any other amounts required to be paid into said Fund.

Section 7.6  Accounting for System Revenues.  As long as any of the Bonds are outstanding and unpaid in principal or interest, the Issuer shall maintain and keep proper books of records and accounts separate and apart from all other records and accounts in which shall be made full and correct entries of all transactions relating to the System.  Not later than three (3) months after the close of each Fiscal Year the Issuer shall cause an audit of such books and accounts to be made by a recognized independent firm of certified public accountants, showing the receipts of and disbursements made for the account of the System.  Such audit shall be available for inspection by the Owners of any of the Bonds, and a copy of such audit shall be furnished promptly after its completion to the Purchaser of the Bonds and the Bond Insurer.  Each such audit, in addition to whatever matters may be thought proper by the accountant to be included therein, shall include the following:

1.         A statement in detail of the income and expenditures of the System for such Fiscal Year.

2.         A balance sheet as of the end of such Fiscal Year.

3.         The accountant's comments regarding the manner in which the Issuer has carried out the requirements of this Ordinance, and the accountant's recommendations for any changes or improvements in the operation of the System or the method of keeping the records relating thereto.

4.         A list of the insurance policies in force at the end of the Fiscal Year, setting out as to each policy the amount of the policy, the risks covered, the name of the insurer and the expiration date of the policy.

5.         The number of metered water, gas, electric and sewerage customers and the number of unmetered water, gas, electric and sewerage customers, if any.

6.         Description of the withdrawal of any System user comprising 4% or more of System sales measured in terms of revenue dollars, since the last audit.

7.         An analysis of additions, replacements and improvements to the physical properties of the System, including a description of any significant facility retirements or expansions planned or undertaken since the last audit.

All expenses incurred in the making of the audits required by this Section shall be regarded and paid as a maintenance and operating expense.  The Issuer further agrees that the Paying Agent and any Owner of the Bonds shall have the right to discuss with the accountant making the audit the contents of the audit and to ask for such additional information as they may reasonably require.  The Issuer further agrees to furnish to the Paying Agent and to any Owners of the Bonds, upon request therefor, a monthly statement itemized to show the income and expenses of the operation of the System and the number of connections for the preceding month.  The Issuer further agrees that the Paying Agent, and the Owners of any of the Bonds shall have at all reasonable times the right to inspect the System and the records, accounts and data of the Issuer relating thereto.

Section 7.7  Rights of Owners.  The Owners of the Bonds from time to time shall be entitled to exercise all rights and powers for which provision is made in the laws of the State of Louisiana.  Any Owners of the Bonds or any trustee acting for such Owners in the manner hereinafter provided, may, either at law or in equity, by suit, action, mandamus or other proceeding in any court of competent jurisdiction, protect and enforce any and all rights under the laws of the State of Louisiana, or granted and contained in this Ordinance, and may enforce and compel the performance of all duties required by this Ordinance, or by any applicable statutes to be performed by the Issuer or by any agency, board or officer thereof, including the fixing, charging and collecting of rentals, fees or other charges for the use of the Utilities System, and in general to take any action necessary to most effectively protect the rights of the said Owners.

In the event that default shall be made in the payment of the interest on or the principal of any of the Bonds as the same shall become due, or in the making of the payments into any Sinking Fund or Reserve Fund or any other payments required to be made by this Ordinance, or in the event that the Issuer or any agency, board, officer, agent or employee thereof shall fail or refuse to comply with the provisions of this Ordinance or shall default in any covenant made herein, and in the further event that any such default shall continue for a period of thirty (30) days after written notice, any Owner of such bonds or any trustee appointed to represent such Owners as hereinafter provided, shall be entitled as of right to the appointment of a receiver of the System in an appropriate judicial proceeding in a court of competent jurisdiction.

The receiver so appointed shall forthwith directly or by his agents and attorneys, enter into and upon and take possession of the System, and each and every part thereof, and shall hold, operate and maintain, manage and control the System, and each and every part thereof, and in the name of the Issuer shall exercise all the rights and powers of the Issuer with respect to the System as the Issuer itself might do.  Such receiver shall collect and receive all rates, fees, rentals and other revenues, maintain and operate the System in the manner provided in this Ordinance, and comply under the jurisdiction of the court appointing such receiver, with all of the provisions of this Ordinance.

Whenever all that is due upon the Bonds and interest thereon, and under any covenants of this Ordinance for reserve, sinking or other funds, and upon any other obligations and interest thereon, having a charge, lien or encumbrance upon the fees, rentals or other revenues of the System, shall have been paid and made good, and all defaults under the provisions of this Ordinance shall have been cured and made good, possession of the System shall be surrendered to the Issuer upon the entry of an order of the court to that effect.  Upon any subsequent default, any Owner of Bonds, or any trustee appointed for Owners as hereinafter provided, shall have the same right to secure the further appointment of a receiver upon any such subsequent default.

Such receiver shall in the performance of the powers hereinabove conferred upon him be under the direction and supervision of the court making such appointment, shall at all times be subject to the orders and decrees of such court, and may be removed thereby and a successor receiver appointed in the discretion of such court. Nothing herein contained shall limit or restrict the jurisdiction of such court to enter such other and further orders and decrees as such court may deem necessary or appropriate for the exercise by the receiver of any function not specifically set forth herein.

Any receiver appointed as provided herein shall hold and operate the System in the name of the Issuer and for the joint protection and benefit of the Issuer and Owners of the Bonds.  Such receiver shall have no power to sell, assign, mortgage or otherwise dispose of any property of any kind or character belonging or pertaining to the System but the authority of such receiver shall be limited to the possession, operation and maintenance of the System for the sole purpose of the protection of both the Issuer and Owners and the curing and making good of any default under the provisions of this Ordinance, and the title to and the ownership of the System shall remain in the Issuer, and no court shall have any jurisdiction to enter any order or decree permitting or requiring such receiver to sell, mortgage or otherwise dispose of any property of the System except with the consent of the Issuer and in such manner as the court shall direct.

The Owner or Owners of Bonds in an aggregate principal amount of not less than twenty‑five percent (25%) of bonds issued under this Ordinance then outstanding may by a duly executed certificate appoint a trustee for the Owners with authority to represent such Owners in any legal proceedings for the enforcement and protection of the rights of such Owners.  Such certificate shall be executed by such Owners, or by their duly authorized attorneys or representatives, and shall be filed in the office of the City Clerk of the Issuer.

Until an event of default shall have occurred, the Issuer shall retain full possession and control of the System with full right to manage, operate and use the same and every part thereof with the rights appertaining thereto, and to collect and receive, and, subject to the provisions of this Ordinance, to take, use and enjoy and distribute the earnings, income, rent, issue and profits accruing on or derivable from the System.

Section 7.8  Sale or Lease of System.  So long as any of the Bonds are outstanding and unpaid in principal or interest, the Issuer shall be bound and obligated not to sell, lease, encumber or in any manner dispose of the System or any substantial part thereof; provided, however, that this covenant shall not be construed to prevent the disposal by the Issuer of property which in its judgment has become worn out, unserviceable, unsuitable or unnecessary in the operation of the System, when other property of equal value is substituted therefor or the sale price thereof is deposited in the aforesaid Capital Additions and Contingencies Fund.

Section 7.9  Priority of Lien.  Except as provided in Section 6.1 of this Ordinance, the Issuer hereby covenants that it will not voluntarily create or cause to be created any debt, lien, pledge, mortgage, assignment, encumbrance or any other charge whatsoever having priority over or a parity with the lien of the Bonds and the interest thereon upon any of the income and revenues of the System pledged as security therefor in this Ordinance.

Section 7.10  Franchise.  So long as any of the Bonds are outstanding and unpaid in principal and interest, the Issuer obligates itself not to grant a franchise to any utility for operation within the boundaries of the Issuer which would render services or facilities similar to those of the System, and also obligates itself to oppose the granting of any such franchise by any other public board having jurisdiction over such matters.  Further, the Issuer shall maintain its corporate identity and existence as long as any of the Bonds remain outstanding.

Section 7.11  Security of and Covenant to Maintain System Revenues.  So long as any of the Bonds are outstanding and unpaid, the Issuer, in operating the System, shall require all of its officers and employees who may be in a position of authority or in possession of money derived from the operation of the System, to obtain or be covered by a blanket fidelity or faithful performance bond, or independent fidelity bonds written by a responsible indemnity company in amounts adequate to protect the Issuer from loss.

Section 7.12  Consulting Engineers.  It is recognized and understood that in purchasing and accepting delivery of the Bonds, the original purchaser thereof has relied and the Owners of the Bonds from time to time will rely, upon representations made by the Issuer that its System will be economically and efficiently operated so that both the Issuer and the Owners of the Bonds may benefit through the production of maximum revenues.  To this end, the Issuer hereby covenants and agrees that so long as any of the Bonds remain outstanding, it will retain a Consulting Engineer to make, within three months after the close of each Fiscal Year, a detailed and comprehensive report upon the operations of the System during the preceding Fiscal Year, the physical condition of the properties comprising the System, the adherence to the provisions of this Ordinance, the efficiency of the management of the property, the proper and adequate keeping of books of account and record, the adherence to budget and budgetary control, and all other things having a bearing upon efficient and profitable operation of the System.  Said Consulting Engineer shall also submit in said report such recommendations for maintenance, insurance, operation, repairs, renewals, replacements, extensions, betterments and improvements as he or they may deem advisable.  Copies of such report shall be placed on file with the Director of Finance of the Issuer and said report shall be furnished to any Owner of any of the bonds upon request.  The payment of the costs of securing such reports shall be considered as one of the costs of maintaining and operating the System.  The provisions of this Section shall be superseded by the provisions of Section 7.7 hereof in the event said Section 7.7 shall become operative by virtue of the occurrences of the conditions stipulated therein.

The Issuer covenants and agrees that in the event it should fail to derive sufficient income from the operation of its System to make the required monthly payments into the funds established by Section 5.2 hereby, it will retain a Consulting Engineer on a continuous basis until all defaults are cured, for the purpose of providing for the Issuer continuous engineering counsel in the operation of its System.  Such Consulting Engineer shall be retained under contract at such reasonable compensation as may be fixed by the Governing Authority, and the payment of such compensation shall be considered to be one of the costs of maintaining and operating the System.  Any Consulting Engineer appointed under the provisions of this Section may be replaced at any time by another Consulting Engineer appointed or retained by the Issuer, with the consent and approval of the original Purchaser of the Bonds herein authorized.

The Consulting Engineer shall prepare within ninety (90) days after the close of each Fiscal Year a comprehensive operating report, which report shall contain therein or be accompanied by a certified copy of an audit of the preceding year's business prepared by the Issuer's certified public accountants, and in addition thereto, shall report upon the operations of the System during the preceding year, the maintenance of the properties, the efficiency of the management of the property, the proper and adequate keeping of books of record and account, the adherence to budget and budgetary control provisions, the adherence to the provisions of this Ordinance and all other things having a bearing upon the efficient and profitable operation of the System, and shall include whatever criticism of any phase of the operation of the System the Consulting Engineer may deem proper, and such recommendations as to changes in operations and the making of repairs, renewals, replacements, extensions, betterments and improvements as the Consulting Engineer may deem proper.  Copies of such report shall be placed on file with the Director of Finance of the Issuer and sent to the original Purchaser of the Bonds, and shall be open to inspection by any Owners of any of the Bonds.

It shall be the duty of the Consulting Engineer to pass on the economic soundness or feasibility of any extensions, betterments, improvements, expenditures or purchases of equipment and materials or supplies, which will involve the expenditure of more than Ten Thousand Dollars ($10,000.00), whether in one or more than one order, and whether authorized by a budget or not, from funds on deposit in the Capital Additions and Contingencies Fund, and the Consulting Engineer shall devise and prescribe a form or forms wherein shall be set forth his or its approval in certificate form, copies of which shall be filed with the City Clerk of the Issuer and the depository for said Capital Additions and Contingencies Fund.

Sixty (60) days before the close of each Fiscal Year, the Consulting Engineer shall submit to the Governing Authority a suggested budget for the ensuing year's operation of the System and shall submit recommendations as to the schedule of rates and charges for electric, water, gas and sewer utility services supplied by the System. A copy of said suggested budget and recommendations shall also be furnished by said Consulting Engineer directly to the original Purchaser of the Bonds.  Such recommendations as to rates and charges, consistent with the requirements relating thereto contained herein, shall be followed by the Governing Authority insofar as practicable and all other recommendations shall be given careful consideration by the Governing Authority and shall be substantially followed, except for good and reasonable cause.  No expenditures for the operation, maintenance and repair of the System in excess of the amounts stated in said budget shall be made in any year, except upon the certificate of the Consulting Engineer that such expenditures are necessary and essential to the continued operation of the System.

It shall be the duty of the Consulting Engineer to prescribe a system of budgetary control along with forms for exercising of such control which shall be utilized by the manager or superintendent of the System and his staff, and the manager or superintendent shall cause to be prepared monthly reports not later than the twentieth day of each month, for the preceding month's business and operation of the Utilities System, which reports shall be submitted to the Consulting Engineer, who shall prepare an analysis of each such report, which analysis shall be filed monthly as expeditiously as possible with the Director of Finance of the Issuer, the manager or superintendent and with the original Purchaser of the Bonds.

In the event the Governing Authority shall fail to select and retain a Consulting Engineer in accordance with the first paragraph of this Section within thirty (30) days after the occurrence of the conditions prescribed thereby, then upon the petition of the Owners of twenty‑five percent (25%) of the aggregate principal amount of the Bonds then outstanding, the Governing Authority shall select and retain such Consulting Engineer as is named in the petition of said Owners.

The provisions of this Section shall apply only during any period when the Issuer may be in default in making required payments into the funds required by Section 5.2 of this Ordinance.

                                                                    ARTICLE VIII

                                   FEDERAL TAX MATTERS; CONTINUING DISCLOSURE

Section 8.1.     General Tax Covenants.  The Issuer further covenants and agrees that it will not take any action, fail to take any action, or permit any action within its control to be taken, or permit at any time or times any of the proceeds of the Bonds or any other funds of the Issuer to be used directly or indirectly in any manner, the effect of which would have otherwise caused the Bonds to be “arbitrage bonds” or would have resulted in the inclusion of the interest on any of the Bonds in gross income under the Code, including, without limitation, (i) the failure to comply with the limitation on investment of Bond proceeds or (ii) the failure to pay any required rebate of arbitrage earnings to the United States of America or (iii) the use of the proceeds of the Bonds in a manner which would cause the Bonds to be “private activity bonds”.

Section 8.2.     Disclosure Under SEC Rule 15c2-12.  The Issuer is not required at this time to comply with the continuing disclosure requirements described in the Rule 15c2-12(b) of the Securities and Exchange Commission [17 CFR '240.15c2-12(b)], because:

(a)        the Bonds are not being purchased by a broker, dealer or municipal securities dealer acting as an underwriter in a primary offering of municipal securities; and

(b)        the Bonds are in denominations of One Hundred Thousand Dollars ($100,000) or more and are being sold to no more than one financial institution or sophisticated investor which (i) has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the prospective investment in the Bonds and (ii) is not purchasing said Bonds for more than one account or with a view to distributing same.

                                                                     ARTICLE IX

                                               SUPPLEMENTAL BOND ORDINANCES

Section 9.1  Supplemental Ordinances Effective Without Consent of Owners. For any one or more of the following purposes and at any time from time to time, an ordinance supplemental hereto may be adopted, which, upon the filing with the Registrar and any rating agency which is then rating the Bonds, of a notice thereof at least fifteen (15) days prior to the adoption thereof, and thereafter with a certified copy thereof, but without any consent of Owners, shall be fully effective in accordance with its terms:

(a)        to add to the covenants and agreements of the Issuer in the Ordinance other covenants and agreements to be observed by the Issuer which are not contrary to or inconsistent with the Ordinance as theretofore in effect;

(b)        to add to the limitations and restrictions in the Ordinance other limitations and restrictions to be observed by the Issuer which are not contrary to or inconsistent with the Ordinance as theretofore in effect;

(c)        to surrender any right, power or privilege reserved to or conferred upon the Issuer by the terms of the Ordinance, but only if the surrender of such right, power or privilege is not contrary to or inconsistent with the covenants and agreements of the Issuer contained in the Ordinance;

(d)        to cure any ambiguity, supply any omission, or cure or correct any defect or inconsistent provision of this Ordinance; or

(e)        to insert such provisions clarifying matters or questions arising under the Ordinance as are necessary or desirable and are not contrary to or inconsistent with the Ordinance as theretofore in effect.

Section 9.2  Supplemental Ordinances Effective With Consent of Owners. Except as provided in Section 9.1, any modification or amendment of the Ordinance or of the rights and obligations of the Issuer and of the Owners hereunder, in any particular, may be made by a supplemental ordinance, with the written consent of the Owners of a majority of the Outstanding principal amount of the Bonds at the time such consent is given. The Issuer shall give a notice thereof to the Registrar and any rating agency which is then rating the Bonds, at least fifteen (15) days prior to the adoption thereof, and thereafter shall furnish to said persons a certified copy thereof.  No such modification or amendment shall permit a change in the terms of prepayment or maturity of the principal of any outstanding Bond or of any installment of interest thereon or a reduction in the principal amount or the prepayment price thereof or in the rate of interest thereon without the consent of the Owner of such Bond, or shall reduce the percentages of Bonds the consent of the Owner of which is required to effect any such modification or amendment, or change the obligation of the Issuer to levy and collect User Fees as provided herein, without the consent of the Owners of all of the Bonds then outstanding, or shall change or modify any of the rights or obligations of either the Registrar without its written assent thereto.

                                                                      ARTICLE X

                                                             EVENTS OF DEFAULT

Section 10.1  Events of Default.  If one or more of the following events (in this Ordinance called “Events of Default”) shall happen, that is to say, (a) if default shall be made in the due and punctual payment of the principal of any Bond when and as the same shall become due and payable, whether at maturity or otherwise; or (b) if default shall be made in the due and punctual payment of any installment of interest on any Bond when and as such interest installment shall become due and payable; or (c) if default shall be made by the Issuer in the performance or observance of any other of the covenants, agreements or conditions on its part in this Ordinance, any supplemental ordinance or in the Bonds contained and such default shall continue for a period of forty-five (45) days after written notice thereof to the Issuer by the Owners of not less than 25% of the Outstanding principal amount of the Bonds; or (d) if the Issuer shall file a petition or otherwise seek relief under any Federal or State bankruptcy law or similar law; then, upon the happening and continuance of any Event of Default, the Owners shall be entitled to exercise all rights and powers for which provision is made under Louisiana law.

                                                                     ARTICLE XI

                                                                MISCELLANEOUS

Section 11.1  Defeasance.   (a) If the Issuer shall pay or cause to be paid to the Owners the principal and interest and prepayment premium, if any, to become due thereon, at the times and in the manner stipulated therein and in the Ordinance, then the covenants, agreements and other obligations of the Issuer to the Owners shall be discharged and satisfied.  In such event, the Registrar shall, upon the request of the Issuer, execute and deliver to the Issuer all such instruments as may be desirable to evidence such discharge and satisfaction and the Registrar shall pay over or deliver to the Issuer all moneys, securities and funds held by them pursuant to this Ordinance which are not required for the payment or prepayment of Bonds not theretofore surrendered for such payment or prepayment. 

(b)        Bonds or interest installments for the payment of which money shall have been set aside and shall be held in trust (through deposit by the Issuer of funds for such payment or otherwise) at the maturity date thereof shall be deemed to have been paid within the meaning and with the effect expressed above in this Section if they have been defeased using Defeasance Obligations pursuant to Chapter 14 of Title 39 of the Louisiana Revised Statutes of 1950, as amended, or any successor provisions thereto.

Section 11.2  Parties Interested Herein.  Nothing in the Ordinance expressed or implied is intended or shall be construed to confer upon, or to give to, any person or corporation, other than the Issuer, the Registrar and the Owners any right, remedy or claim under or by reason of the Ordinance or any covenant, condition or stipulation thereof; and all the covenants, stipulations, promises and agreements in the Ordinance contained by and on behalf of the Issuer shall be for the sole and exclusive benefit of the Issuer, the Registrar and the Owners.

 Section 11.3 Loan Agreement and Commitment Agreement. The Governing Authority recognizes that the Bonds will be sold to the Department pursuant to its State Revolving Fund Program.  In connection with this sale, the Issuer and the Department will enter into the Loan Agreement presented by the Department to the Issuer pertaining to the Bonds and the Project, which Loan Agreement shall be substantially in the form attached as Exhibit B hereto.  The Executive Officers are hereby authorized to execute such Loan Agreement on behalf of and under the seal of the Issuer in substantially the form on file with the Clerk of the Issuer with such changes, additions and deletions as shall in the sole opinion of the Executive Officers, upon advice of Bond Counsel, be deemed, the form and contents of which Loan Agreement are hereby approved by this Governing Authority.  Prior to the delivery of the Bonds and acting upon advice of Bond Counsel, the Issuer will enter into the Loan Agreement with such changes, additions and deletions as may be deemed appropriate by the Executive Officers upon advice of Bond Counsel, and the Executive Officers are directed to execute such Loan Agreement on behalf of the Issuer.  So long as the Department owns any portion of the Bonds, then to the extent that any provision of this Ordinance is inconsistent with or contrary to any provision of the Loan Agreement, the applicable provision of the Loan Agreement shall control.  As shall be provided in the Loan Agreement, the Issuer shall comply with certain provisions of the Loan Agreement, as specified therein, regardless of whether or not the Department is the owner and regardless of any prepayment or defeasance of the Bonds prior to their final stated maturity.  The Executive Officers are further authorized to enter into any supplemental loan agreement with the Department which may be required to carry out the provisions of this Ordinance.

With the advice of Bond Counsel, the Executive Officers are further authorized and directed to execute on behalf of the Issuer a Commitment Agreement by and between the Department and the Issuer which the Department may require as a prerequisite to the execution of the Loan Agreement, said Commitment Agreement to be substantially in the form of the Commitment Agreement on file with the Clerk of the Issuer.

Section 11.4  Registrar.  The Issuer will at all times maintain a Registrar for the performance of the duties hereunder.  The initial Registrar pursuant to this Ordinance is the Clerk of the Issuer.  This Governing Authority reserves the right to appoint a successor Registrar by (1) filing with the person then performing such function a certified copy of an ordinance appointing a successor and (2) causing notice to be given to each Owner.  Every successor Registrar shall at all times be a corporation organized and doing business under the laws of the United States of America or of any State, authorized under such laws to exercise trust powers, and subject to supervision or examination by Federal or State authority.  In appointing a successor Registrar, this Governing Authority will authorize the Executive Officers to execute an appropriate agreement with the successor Registrar or and on behalf of the Issuer in such form as may be satisfactory to the Executive Officers, setting forth the duties and obligations of the successor Registrar.

Section 11.5  No Recourse on the Bonds.  No recourse shall be had for the payment of the principal of or interest on the Bonds or for any claim based thereon or on this Ordinance against any member of the Governing Authority or officer of the Issuer or any person executing the Bonds.

Section 11.6  Successors and Assigns.  Whenever in this Ordinance the Issuer is named or referred to, it shall be deemed to include its successors and assigns and all the covenants and agreements in this Ordinance contained by or on behalf of the Issuer shall bind and ensure to the benefit of its successors and assigns whether so expressed or not. 

Section 11.7  Severability.  In case any one or more of the provisions of the Ordinance or of the Bonds issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of the Ordinance or of the Bonds, but the Ordinance and the Bonds shall be construed and enforced as if such illegal or invalid provisions had not been contained therein.  Any constitutional or statutory provision enacted after the date of the Ordinance which validates or makes legal any provision of the Ordinance or the Bonds which would not otherwise be valid or legal shall be deemed to apply to the Ordinance and to the Bonds. 

Section 11.8  Publication of Ordinance.  This Ordinance shall be published one time in the official journal of the Issuer.

Section 11.9. Effective Date.  This Ordinance shall become effective immediately.

This Ordinance was introduced on the 29^th day of November, 2011.

Notice was published on the 2^nd day of December, 2011.

This Ordinance having been submitted in writing, introduced, notice published, having been read and adopted at a public meeting of the Council, was then submitted to an official vote as a whole, the vote thereon being as follows:

YEAS:                 Chuck Fowler, Mitzi Gibson, Jim Villard, Jerry W. Jones, Jr., Harry B. Silver, Roosevelt L. Johnson, Ed Larvadain, III.

NAYS:                None.

ABSENT:            None.

And the Ordinance was declared adopted on this, the 13^th day of December, 2011, and final publication was made in the “Alexandria Daily Town Talk” on the 16^th day of December, 2011.

/S/  NANCY L. THIELS                                                                                                /S/  ROOSEVELT L. JOHNSON

                            City Clerk                                                                     President

/S/  JACQUES ROY

                               Mayor

                                                                                                                                         EXHIBIT “A”

                                                               (FORM OF BOND)

                                                                                                                                         EXHIBIT “B”

                                                     (FORM OF LOAN AGREEMENT