Tribal Bond Ordinance
WARM SPRINGS TRIBAL CODE
RESTATED WARM SPRINGS TRIBAL BOND ORDINANCE
Table of Contents
730.3 Interpretation of Constitution
730.4 Authority to Issue Waiver of Sovereign Immunity for Certain Purposes
730.5 Authority to Issue Bonds
730.6 Authority to Establish Lines of Credit
730.7 Authority to Secure Interim Financing
730.8 Authority to Enter into Swap Agreements
730.9 Tribal Council Powers
730.10 Perfection, Priority and Enforcement of Pledge
730.11 Amount, Terms, Conditions, Interest, etc. of Bonds
730.12 Registration System and Appointment of Financial Institutions
730.13 Form and Content of Bonds
730.14 Reproduction of Physical Instrument
730.15 Sale of Bonds
730.16 Payment of Costs of Issuance and Sale
730.17 Personal Liability
730.18 Revenue Bonds
730.19 Dispute Resolution
730.20 Governing Law
730.21 Warm Springs Forest Products Industries
730.22 Effective Date; Savings Clause
WARM SPRINGS TRIBAL CODE
RESTATED WARM SPRINGS TRIBAL BOND ORDINANCE
The purpose of this Ordinance (the “Ordinance”) is to establish procedures to enable the Tribal Council (the “Tribal Council”), as the governing body of the Confederated Tribes of the Warm Springs Reservation of Oregon (the “Tribes”), to issue bonds or incur other obligations from federal and non-federal sources under Article V, Section 1(e) of the Constitution of the Tribes (the “Tribal Constitution”), with amendments approved by the Secretary of the Interior on March 27, 1990, and with corresponding approval by the tribal voters on March 6, 1990 (“Article V, Section 1(e)”), for public purposes (“Tribal Projects”) approved by tribal referendum. It is the further purpose of this Ordinance to confirm that the Tribal Council is the final arbiter of the meaning of the Tribal Constitution.
Unless defined elsewhere in this Ordinance or the context clearly requires otherwise, the definitions in this Section apply throughout this Ordinance.
- “Authorized Representative” means the Chairman or the Vice-Chairman of the Tribal Council, or any designee of the Tribal Council.
- “Bond” means a Full Faith and Credit Bond, a Revenue Bond, or other obligations.
- “Credit Enhancement Device” means a letter of credit, line of credit, bond insurance policy or other device or facility used to enhance the creditworthiness or marketability of any Bonds.
- “Full Faith and Credit Bond” means an obligation, including without limitation a lease-purchase obligation or bond anticipation note, incurred or issued to finance a Tribal Project, and which is specifically designated by the Tribal Council as a full faith and credit obligation payable from taxes, if any, which may be levied, or from the general revenues of the Tribes.
- “Obligation” means an agreement that evidences an indebtedness of the Tribes, other than a Full Faith and Credit Bond or a Revenue Bond, and includes, but is not limited to, conditional sales contracts, loan agreements, lease obligations, and promissory notes.
- “Operative Document” means a resolution, ordinance, trust indenture, security agreement or other document in which the Tribes Pledge Property as security for a Bond.
- “Pledge” means to create a security interest in or a lien on Property to secure payment or performance of an Obligation or Bond. The security interest or lien is created by mortgaging, assigning or encumbering Property or by creating a security interest in any other manner.
- “Pledgee” means (a) A trustee for the holder of a Bond or Obligation; or (b) The holder of a Bond or Obligation if a trustee was not appointed in the Operative Document or if the Operative Document authorizes the holder of the Bond or Obligation to foreclose the lien of the Pledge and enforce the remedies consequent to the Pledge in lieu of the trustee.
- “Property” means real or personal property of the Tribes, tangible or intangible, whether owned by the Tribes when a Pledge is made or acquired subsequently by the Tribes, and includes Revenues, contract rights, receivables and securities.
- “Revenues” means, with respect to the issuance of Revenue Bonds, all fees, tolls, excise taxes, assessments, property taxes and all other taxes of whatever kind or nature, rates, charges, loan agreements, rentals and all other income and receipts of whatever kind or character derived by or to which a public body is entitled from the operation, sale or use of facilities, projects, utilities or systems owned or operated by the Tribes and other revenues legally available to be pledged to secure Revenue Bonds.
- “Revenue Bonds” means Bonds issued for any public purpose, which are secured by Revenues pledged for such public purpose.
- “Swap Agreement” means a contract, or an option or forward commitment to enter into a contract, for the exchange of interest rates that provides for (a) Payments based on levels of or changes in interest rates; or (b) Provisions to hedge payment, rate, spread or similar exposure including, but not limited to, an interest rate floor or cap or an option, put or call.
- “Tribal Enterprise” means an enterprise of the Tribes duly established by referendum pursuant to Section 12 of the corporate charter of the Tribes.
- “Tribal Project” means any project or projects of the Tribes or any enterprises of the Tribes to be financed with the proceeds of Bonds issued for a public purpose.
730.3 Interpretation of Constitution.
The Tribal Council is the ultimate arbiter of the meaning of the Tribal Constitution and of tribal laws, and any meaning that the Tribal Council may assign to a constitutional provision or to a tribal law by ordinance or resolution shall be final and binding on all courts of the Tribes. When any party in entering into a contract or other transaction pertaining to the issuance of Bonds shall have relied on such meaning as expressed by Ordinance or Resolution of the Tribal Council, such meaning becomes a part of such contract or transaction and shall not thereafter be revoked or modified to the prejudice of such party.
730.4 Authority to Issue Waiver of Sovereign Immunity for Certain Purposes.
The Tribal Council, on behalf of the Tribes, is hereby authorized to waive the sovereign immunity of the Tribes, its officers, attorneys, agents, and employees, for the limited purpose of providing for the sale, issuance, security and performance of the Bonds, but any such waiver may only be made by a duly authorized resolution of the Tribal Council.
730.5 Authority to Issue Bonds.
- The Tribal Council is hereby authorized to provide by resolution to issue Bonds for the payment of the whole or any portion of the cost and expense of any Tribal Project. The Tribal Council will by resolution determine the maximum amount of the Bond issue. The amount may equal, but may not exceed, the total amount specified in the tribal referendum authorizing the issuance of Bonds for the Tribal Project.
- Article V, Section 1(e), of the Tribal Constitution, is construed to require that Tribal Projects be approved by referendum, which referendum will refer to the Tribal Project by name, and will state the terms of the Tribal Project. The word “terms” in the preceding sentence and in the second clause of Article V, Section 1(e) of the Tribal Constitution, which states that the Tribes shall be allowed “* * * to borrow money for public purposes in accordance with terms to be approved by Tribal referendum,” refers only to the maximum amount of the Bonds that may be issued for particular Tribal Projects. Article V, Section 1(e) of the Tribal Constitution is further construed to allow the Tribal Council or its designee to determine certain particular terms and conditions of any borrowing or issuance of Bonds for an approved Tribal Project pursuant to Section 9 of this Ordinance, subject to any restrictions contained in the referendum approving the Bonds.
- The words “maximum amount of the Bond issue” and “total amount specified in the Tribal referendum” as used in Paragraphs (1) and (2) of this section refer only to the principal amount of the Bonds and the Tribal Council is authorized to provide for the payment of interest and prepayment premiums, if any, in addition to such principal amount.
730.6 Authority to Establish Lines of Credit.
Pursuant to its authority under Article V, Section 1(e) of the Tribal Constitution, the Tribal Council, on behalf of the Tribes, is hereby authorized to establish lines of credit with any national bank, association, or state chartered bank to be drawn upon in exchange for its Bonds, to delegate to its Authorized Representative authority to determine the amount of credit extended,
and to pay interest and other finance or service charges. The interest rates on such Bonds may be a fixed rate or rates set periodically, or a variable rate or flexible rates determined by agreement of the parties.
730.7 Authority to Secure Interim Financing.
Bonds authorized under this Ordinance which are issued in anticipation of taxes or other Revenues, and any Bonds which are issued to refund them, shall not be issued prior to the beginning of, and shall mature not later than, the end of the fiscal year in which the taxes or other Revenues are expected to be received. Bonds issued in anticipation of taxes or other Revenues shall not be issued in an amount greater than 80 percent of the amount budgeted to be received in the fiscal year in which the Bonds are issued.
Bonds which are issued in anticipation of a grant will mature not later than one year after the date the grant is estimated to be received. Bonds issued to provide interim financing for capital assets shall mature not later than one year from the estimated completion or acquisition of the capital assets. Bonds issued to provide permanent or long-term financing for capital assets or a Tribal Project are not subject to the maturity limitations stated in this Section.
Except as provided in this Section, Bonds authorized under this Section may be in any form and contain any terms, including provisions for redemption at the option of the owner and provisions for the varying of interest rates in accordance with any index, banker’s loan rate or other standard.
730.8 Authority to Enter into Swap Agreements.
- The Tribal Council may by resolution delegate to its Authorized Representative the authority to enter into a Swap Agreement related to an Obligation or Bond that the Tribes have issued or will issue to manage payment, interest rate, spread or similar exposure undertaken in connection with the Obligation or Bond.
- The Swap Agreement shall include such provisions related to payment, term, security, collateralization, termination, default and remedy as the Authorized Representative determines are necessary or appropriate.
- Subject to covenants applicable to the related Obligation or Bond, payments required to be made under the Swap Agreement by the Tribes may be made from revenues or other moneys committed to or legally available to pay the underlying debt obligation, and may rank in an order of priority of payment relative to the payment of the underlying debt obligation as the Authorized Representative determines.
- A Swap Agreement entered into in connection with and Obligation or Bond issued pursuant to this Ordinance does not constitute a borrowing of money within the meaning of Article V, Section 1(e) of the Tribal Constitution and, therefore, the terms of the Swap Agreement do not need to be approved by tribal referendum.
730.9 Tribal Council Powers.
To secure the Bonds or any Credit Enhancement Device, the Tribal Council shall have the power and is authorized to exercise the Tribe’s powers to take the following actions:
- Cause appropriations from anticipated taxes, grants, other Revenues, loan repayments, the proceeds of any Bonds or other permanent financing, or any combination thereof;
- Segregate any pledged funds in separate accounts which may be held by the Tribes or any third party trustee designated by resolution of the Tribal Council;
- Enter into contracts with third parties to obtain direct or standby lines of credit, Credit Enhancement Devices, or other financial commitments designated to provide additional security for Bonds authorized for Tribal Projects;
- Establish any reserves deemed necessary for the payment of the Bonds;
- Adopt resolutions and enter into agreements containing covenants and provisions for protection and security of the owners of Bonds, which shall constitute enforceable contracts with such owners; and
- For Full Faith and Credit Bonds approved by Tribal referendum pursuant to Article V, Section 1(e) of the Tribe’s Constitution, pledge the Tribes’ general revenue-raising and taxing powers to produce sufficient funds to pay debt service, on the Full Faith and Credit Bonds in accordance with their terms.
730.10 Perfection, Priority and Enforcement of Pledge.
This Section governs the creation, perfection, priority and enforcement of a lien of a Pledge made by the Tribal Council pursuant to this Ordinance.
- The Tribal Council may Pledge all or a portion of the Tribes’ Property as security for payment of its Bonds or Obligations, or any line of credit related to such Bonds or Obligations, and for performance of a covenant or agreement entered into in relation to the issuance of Bonds or Obligations, or any line of credit related to such Bonds or Obligations. The lien created by the Pledge is valid and binding from the time the Pledge is made.
- Pledged Property is subject immediately to the lien of the Pledge without physical delivery, filing or any other act.
- Except as provided otherwise expressly in the Operative Document, the lien of the Pledge is superior to and has priority over other claims and liens of any kind.
- When Property subject to a Pledge is acquired by the Tribes after the Pledge is made, the Property is subject to the lien upon acquisition by the Tribes without physical delivery, filing or any other act, and the lien shall relate to the time the Tribes originally made the Pledge.
- The Tribes may reserve the right to Pledge a Pledged Property as security for Bonds subsequently issued by the Tribes pursuant to this Ordinance. If the Tribes reserve that right, subject to the terms of the Operative Document that created the previous Pledge, the lien of the subsequent Pledge may be on parity or pari passu basis with the lien of the previous Pledge, on a prior or superior basis with the lien of the previous Pledge or on a subordinate basis with the lien of the previous Pledge, as specified in the Operative Document creating the subsequent Pledge. The lien of the subsequent Pledge: (a) Has the priority specified in the Operative Document creating the subsequent Pledge; and (b) Is superior to and has priority over other claims and liens of any kind except the lien of a Pledge with which the lien of the subsequent Pledge is on a parity or subordinate basis, as specified in the Operative Document.
- Except as provided in subsection (7) of this Section, a Pledgee may commence an action in a court of competent jurisdiction, as specified and consented to by Tribal Council in the Operative Document, to foreclose the Pledge and exercise rights and remedies available to the Pledgee under the Operative Document.
- When Pledged Property consists of moneys or Property in a fund for debt service reserves or payments, a Pledgee may foreclose the lien of the Pledge by applying the moneys or Property in the fund to the payment of Bonds subject to the terms, conditions and limitations in the Operative Document.
730.11 Amount, Terms, Conditions, Interest, etc. of Bonds.
- The Tribal Council may by resolution delegate to its Authorized Representative its authority to determine the interest rate or rates applicable to any Bonds issued to finance a Tribal Project, provided that such interest rate shall in no event exceed the maximum true interest cost or maximum interest rate designated by the Tribal Council resolution authorizing such Bonds. The Tribal Council may also delegate to the Authorized Representative its authority to determine an amortization schedule for the Bonds, provided that the maximum term does not exceed 40 years.
- Except as provided in this Ordinance, the Authorized Representative may act on behalf of the Tribal Council to perform any and all other necessary acts pertaining to the issuance of the Bonds, including, without limitation, the determination of any conditions of the Bonds issue, bond denominations, redemption rights, registration privileges, manner of execution, price, manner of sale, covenants and form, including registration of principal and interest, registration of principal only, or bearer.
730.12 Registration System and Appointment of Financial Institutions.
- The Tribal Council is authorized to establish a system of registering the ownership of its Bonds as to principal and interest, or principal only. Registration may include, without limitation: (a) A book entry system of recording the ownership of a Bond whether or not a physical instrument is issued; or (b) Recording the ownership of a Bond together with the requirement that the transfer of ownership may only be effected by the surrender of the old Bond and either the reissuance of the old Bond or the issuance of a new Bond to the new owner.
- The system of registration shall define the method or methods by which transfer of the registered Bonds shall be effective, and by which payment of principal and any interest shall be made. The system of registration may permit the issuance of Bonds in any denomination to represent several registered Bonds of smaller denominations. The system of registration may also provide for any writing relating to a Bond that is not issued as a physical instrument, for identifying numbers or other designations, for a sufficient supply of certificates for subsequent transfers, for record and payment dates, for varying denominations, for communications to the owners of Bonds, for accounting, canceled certificate destruction, registration and release of securing interests, and for such other incidental matters pertaining to the registration of Bonds as the issuer may deem to be necessary or appropriate.
- (a) The Tribal Council or its designee may appoint a national banking association or state chartered bank, maintaining a minimum capital surplus of $50,000,000 together with its bank holding company or other affiliate bank (collectively the “Bank”), to act with respect to an issue of its Bonds as authenticating trustee, transfer agent, registrar, and paying or other agent, and specify the rights and duties and means of compensation of any such bank so acting. The Tribal Council or its designee may also enter into agreements with any such Bank in connection with the establishment and maintenance by the Bank of a nationally recognized central depository system for the transfer or pledge of Bonds. (b) The Tribal Council may by resolution appoint the Secretary-Treasurer of the Tribes, or any other fiscal agency, to serve as the fiscal agency.
- Nothing in this Section precludes the Tribes, the Tribal Council, or a trustee appointed by the Tribal Council, pursuant to any other provision of law, from itself performing, either alone or jointly with other issuers, fiscal agencies, or trustees, any transfer, registration, authentication, payment, or other function described in this Section.
730.13 Form and Content of Bonds.
- Bonds shall be in such denominations as may be provided in the resolution authorizing their issue and shall be numbered from one upwards consecutively. Each Bond shall: (a) Be signed by the Authorized Representative of the Tribal Council; (b) Have the seal of the Tribes affixed thereto; (c) Refer to the Tribal Project for which it is issued and the resolution ordering it; (d) Provide that the principal sum therein named and the interest thereon shall be, unless otherwise provided by the referendum authorizing the Tribal Project, payable out of the general revenues of the Tribes, or out of a source of security designated for the Bonds in the resolution of the Tribal Council authorizing such Bonds; and (e) Be in any form, including bearer bonds or registered bonds as provided by Tribal law.
- Any Bonds may be signed by the Authorized Representative of the Tribal Council, or in lieu thereof, may have printed thereon a facsimile of his or her signature.
730.14 Reproduction of Physical Instrument.
When the Tribal Council issues Bonds as physical instruments, the Bonds shall be printed, engraved, lithographed, photocopied, typed, or reproduced and the manual or facsimile signatures of the Authorized Representative of the Tribal Council shall be included on each Bond.
730.15 Sale of Bonds.
The Tribal Council may authorize the Authorized Representative to:
- Sell the Bonds at a public or private sale on behalf of the Tribes; and
- Negotiate the terms of a purchase contract for the Bonds, the terms of which shall be binding upon the Tribes upon Tribal Council approval and upon execution by the Authorized Representative.
730.16 Payment of Costs of Issuance and Sale.
The proceeds of any Bonds issued may be used to pay incidental costs and costs related to the sale and issuance of the Bonds. Such costs include payments for fiscal agent, paying agent, bond trustee, interest rate swap agreement fees or costs, registrar fees, legal expenses, bond ratings, printing, engraving, underwriting fees or discounts, advertising, credit enhancement fees, bond insurance premiums. These costs shall also include the establishment and funding of reserve accounts and other accounts, an amount for working capital, capitalized interest, necessary and related engineering, architectural, planning and inspection costs, and other similar activities or purposes.
730.17 Personal Liability.
Neither the holder nor owner of any Bond shall have any claim (other than a writ of mandamus, injunction or other similar writ or proceeding) against any member of the Tribal Council or any officer, employee, or agent of the Tribes, for personal, contractual or monetary liability on the Bonds.
730.18 Revenue Bonds.
- The Tribal Council is hereby authorized to provide by resolution to issue Revenue Bonds for the payment of the whole or any portion of the cost and expense of any Tribal Project. The Tribal Council will by resolution determine the maximum amount of the Revenue Bond issue. The amount may equal, but may not exceed, the total amount specified in the tribal referendum authorizing the issuance of Revenue Bonds for the Tribal Project.
- The Tribal Council may Pledge for the payment of Revenue Bonds issued in connection with a Tribal Project all or any portion of (a) The Revenues or any revenue producing facility providing services related to the services financed by the Revenue Bonds; (b) The Revenues of a public utility or system, or an addition or extension thereto; (c) All or any portion of the Revenues of the Tribes; or (d) Any other legally available moneys.
- If the Tribal Council determines that it is necessary to provide additional security for the Revenue Bonds, the Tribal Council may, to the extent permitted by law and by the referendum authorizing the issuance of the Revenue Bonds, mortgage, grant security interests in, Pledge, or otherwise encumber facilities, projects, utilities or systems owned or operated by the Tribes. Such security may be given in favor of the holders of the Revenue Bonds, a trustee therefore or as security for its obligations arising under any Credit Enhancement Device. The Tribal Council may obtain a Credit Enhancement Device for Revenue Bonds provided that such Credit Enhancement Device is payable solely from Revenues. The Tribal Council may loan the proceeds of any Revenue Bonds to any enterprise of the Tribes or to any member of the Tribes on the terms and conditions specified in a resolution of the Tribal Council.
- When issuing Revenue Bonds, the Tribal Council may do any one or more of the following: (a) By resolution delegate to the Authorized Representative, the authority to determine the principal amounts, the applicable interest rate or rates or the method to determine variable, auction or adjustable interest rates (provided that in no event will the fixed or flexible interest rate or rates exceed the maximum net interest cost designated by the Tribal Council resolution authorizing such Revenue Bonds), an amortization schedule for the Revenue Bonds (provided that the maximum term does not exceed 40 years), redemption, purchase or tender provisions, denominations, and other terms and conditions of such Revenue Bonds which are not appropriately determined at the time of the enactment of the resolution. The authority delegated under this subsection shall be exercised subject to any applicable limitations set by law or by the resolution authorizing the Revenue Bonds; (b) Pledge as security for its obligations arising under or with respect to any Credit Enhancement Device any Revenues Pledged to the payment of the related Revenue Bonds, and such obligations shall be payable from the same sources from which the Revenue Bonds are payable; (c) Assign its rights under project agreements and other contracts related to the project being financed by the Revenue Bonds; (d) Enter into indentures or other agreements with bond trustees and deposit funds with trustees for the benefit of such bondowners; and (e) Establish a debt reserve for the payment of all amounts due and owing under such Revenue Bonds, which debt service reserve may be funded out of the proceeds derived from the issuance and sale of such Revenue Bonds or from such other sources as the governing body of the Tribal Council may determine, and establish such other reserves as may be approved by the Tribal Council.
- The substance of the limitations included in this subsection shall be plainly printed, written, engraved, or reproduced on (a) Each Revenue Bond that is a physical instrument; (b) The official notice of sale; and (c) Each official statement associated with the Revenue Bonds.
730.19 Dispute Resolution.
- Unless otherwise provided by the terms of the specific Bond issue, a party with a claim arising from the issuance of Bonds under this Ordinance shall first file a written petition with the Tribal Council or its designee for a hearing on the claim, which hearing shall be granted within 90 days of the filing of the petition. The hearing will be on the record, and shall be transcribed verbatim. The petitioner shall pay the costs of transcription. The Tribal Council or its designee shall issue a written decision on the matter.A party dissatisfied with the decision of the Tribal Council or its designee may seek judicial review in a Warm Springs Tribal Court. For purposes of this review the Tribal Council agrees not to raise any sovereign immunity defenses which the Tribes may possess in the Tribal Court. The appeal must be filed within 10 days of the written decision by the Tribal Council or its designee. The Tribal Court shall issue a written decision on the matter.A party dissatisfied with the decision of the Tribal Court may invoke arbitration under the rules and auspices of the American Arbitration Association. The arbitrator shall conduct a de novo review upon the written record before the Tribal Court and shall issue a written decision. For purposes of this arbitration, the Tribal Council shall not raise a sovereign immunity defense, provided that this agreement shall be strictly construed and shall not be construed as an agreement not to assert any such immunity in any action brought or maintained in the courts of a State or in the federal courts.
- In connection with authorizing a specific Bond issue, the Tribal Council (by authorization of the terms and agreements pertaining to the Bond issue or otherwise) may provide for a dispute resolution system differing from that provided in paragraph (1) of this Section. Such other dispute resolution system may provide, among other things, for waiving the necessity of any proceedings before the Tribal Council or Tribal Courts, for other or greater waivers of sovereign immunity, for lesser or greater powers of the arbitrators than those stated by the rules of the American Arbitration Association, and for federal and state court jurisdiction.
730.20 Governing Law.
The law governing a specific Bond issue shall be as designated in the Operative Documents and approved by the Tribal Council in the resolution authorizing the Bond issue pursuant to this Ordinance.
730.21 Warm Springs Forest Products Industries.
Pursuant to its power under Section 5 of this Ordinance, the Tribal Council is hereby authorized to provide by resolution to issue Bonds for the financing or refinancing of that Warm Springs Forest Products Industries, a Tribal Enterprise established under Section 12 of the Tribes’ corporate charter on April 11, 1967, subject to the borrowing limitations imposed on Tribal Enterprises by the Tribes’ corporate charter.
730.22 Effective Date; Savings Clause.
Sections 730.001 to 730.021 in the form restated and enacted on the 29th day of July, 2004, shall take effect immediately on that date. Such enactment shall not apply to transactions prior to that date conducted pursuant to Ordinance No. 72 enacted October 16, 1991, as amended by Ordinance No. 72-1 enacted March 3, 1992, each as restated by Ordinance No. 72-2 enacted November 3, 1992, and Ordinance No. 72-3 enacted June 3, 2003, provided, however, that Section 730.008(4) of this Ordinance shall retroactively apply to any Swap Agreement entered into by the Tribes after September 1, 2003, in connection with the Confederated Tribes of the Warm Springs Reservation of Oregon Hydroelectric Revenue Bonds, Series 2003 (Pelton-Round Butte Project)(Taxable Auction Rate Securities).