CC Resolution 1998-126d_W
RESOLUTION NO.98-126
A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF LA QUINTA ISSUING LIMITED OBLIGATION IMPROVEMENT BONDS
UNDER THE IMPROVEMENT BOND ACT OF 1915 FOR ASSESSMENT DISTRICT
NO.97-i LA QUINTA NORTE)
WHEREAS, this Council has heretofore initiated assessment proceedings
pursuant to its Resolution No.98-61 under the Municipal Improvement Act of 1913,
Division 1 2 of the Streets and Highways Code the Code")) and has confirmed an
assessment in the total amount of $826,839.00; and
WHEREAS, the assessment proceedings provide for the issuance of bonds
pursuant to the Improvement Bond Act of 1915 Division 10 of the Code) the 1915
Act"); and
WHEREAS, the Council in its concurrent resolution awarded the sale of its
limited obligation bonds to Miller & Schroeder Financial, Inc. the Underwriter") at the
interest rates to be established in the Bond Purchase Contract with said firm; and
WHEREAS, this Council desires, pursuant to Section 8650.1 of the Code, to
establish the denomination of the bonds and the amount to mature each year which
will be other and different than that provided in Section 8650 of the Code; and
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF LA QUINTA DOES
HEREBY RESOLVE, DETERMINE, AND ORDER AS FOLLOWS:
SECTION 1. That the above recitals are all true and correct.
SECTION 2. Bonds in the aggregate principal amount of not to exceed
$780,000 with the exact amount to be determined by the Finance Director shall be
issued as hereinafter provided upon the security of unpaid assessments levied in
accordance with the Municipal Improvement Act of 1913 and under and pursuant to
the proceedings thereunder duly had and taken. The bonds herein provided to be
issued shall be known as City of La Quinta, Limited Obligation Improvement Bonds
Assessment District No.97-i La Quinta Norte)" the Bonds") and shall be dated their
date of delivery. The Bonds shall be issued only in fully registered form in
denominations of $5,000 or any integral multiple thereof, except that one Bond may
include the amount by which the total issue exceeds the maximum integral multiple
of $5,000 contained therein, if any. The Bonds shall be issued as serial and term
bonds with annual serial maturities beginning on September 2, 2000 and every
succeeding 1 2 months thereafter until September 2, 2009, and with a term bond
maturity of September 2, 2018. Bonds shall mature in the amounts and bear interest
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at the rates of interest to be set forth in the Bond Purchase Contract concurrently
submitted to and approved by this Council.
SECTION 3. The Bonds shall be issued pursuant to the provisions of the
Improvement Bond Act of 191 5, and shall be substantially in the form as authorized
pursuant to the terms and provisions of said Act, except as such form may vary from
the terms and conditions set forth in this resolution.
SECTION 4. Each Bond shall be of a single maturity and interest rate as set
forth in the aforesaid Bond Purchase Contract, said interest rate not to exceed 1 2%
per annum. Each Bond shall bear interest from the March 2 and September 2
Interest Payment Date") next preceding the date on which it is authenticated and
registered, unless i) said Bond is authenticated and registered as of an Interest
Payment Date, in which event it shall bear interest from such date, or ii) said Bond is
authenticated and registered prior to the fifteenth day immediately preceding the first
Interest Payment Date, in which case it shall bear interest from their date of initial
delivery, or iii) said Bond is authenticated and registered prior to an Interest Payment
Date and after the close of business on the fifteenth day of the month immediately
preceding such interest payment date, in which event it shall bear interest from such
Interest Payment Date, until payment of its principal sum has been discharged.
Interest shall be payable commencing on March 2, 1 999, and semi-annually thereafter
on September 2 and March 2 of each year to maturity and shall be based on a 360 day
year with twelve thirty-day months.
SECTION 5. The principal, redemption premiums and interest on the Bonds shall
be payable in lawful money of the United States of America at the principal corporate
trust office of U.S. Bank Trust National Association the Paying Agent" or Registrar"
or Transfer Agent"). Interest on said Bonds shall be paid by check mailed by first
class mail to the registered owner thereof at his address as it appears on the books of
registration, as of the 1 5th day immediately preceding said Interest Payment Date.
SECTION 6. Any Bond may be redeemed in whole or in part in integral multiples
of $5,000 on any Interest Payment Date, at the option of the City upon 30 days'
notice to the Bondowner from moneys on deposit with the Paying Agent, at the
following prices, expressed as a percentage of the principal amount of Bonds called for
redemption, together with accrued interest to the date of redemption:
103% if redeemed on or before September 2, 2005
102% if redeemed on March 2 or September 2, 2006
101% if redeemed on March 2 or September 2, 2007
100% if redeemed on March 2 or September 2, 2008 and thereafter
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Any Bond shall be subject to redemption in whole, or in part, in integral
multiples of $5,000 on any Interest Payment Date from proceeds of refunding bonds
pursuant to Division 11.5 of the Act if any such refunding bonds are sold), from
repayments of assessments deposited in the Prepayment Account of the Redemption
Fund, from excess proceeds in the Assessment Fund or from surplus moneys in the
Improvement Fund, upon 30 days' notice to the Bondowner and payment of the
principal amount thereof and interest accrued thereon to the date of redemption, at the
redemption prices shown above.
The Bonds maturing on September 2, 2018, are subject to a mandatory
redemption, in part by lot, from sinking fund payments set forth in the Bond Purchase
Contract on September 2, 2010, and on September 2 in each year thereafter to and
including September 2, 2018, at a redemption price equal to the principal amount
thereof to be redeemed without premium), together with interest accrued thereon to
the date fixed for redemption; provided, however, that if some, but not all, of the
Bonds maturing September 2, 2018 have been optionally redeemed pursuant to the
above-described optional redemption provisions, the total amount of sinking fund
payments to be made subsequent to such redemption shall be reduced in an amount
equal to the principal amount of the Bonds maturing September 2, 2018 optionally
redeemed by reducing each such future sinking fund payment on a pro-rata basis as
nearly as practicable) in integral multiples of $5,000.
No interest will accrue on a Bond beyond the Interest Payment Date on which
said Bond is called for redemption provided that the amount necessary for the
redemption has been deposited with the Paying Agent. Notice of redemption must be
given to the applicable Bondowners by registered or certified mail postage prepaid) or
by personal service at least 30 days prior to the redemption date, if less than all of the
outstanding Bonds are to be redeemed. The determination as to which Bond or Bonds
are to be called will be made by the Paying Agent on behalf of the City
TreasureriFinance Director, in accordance with Streets & Highways Code Section
8768 of the 1915 Act.
SECTION 7. Any fully registered Bond may, in accordance with its terms, be
transferred upon the books of registration required to be kept pursuant to the
provisions of Section 9 by the owner in whose name it is registered, or by his duly
authorized attorney or legal representative, upon surrender of such fully registered
Bond for registration of such transfer, accompanied by delivery of a written instrument
of transfer in a form acceptable to the Transfer Agent and by the owner of said Bonds,
duly executed. The Transfer Agent shall require the payment by the bondowner
requesting such transfer of any tax or other governmental charge required to be paid
with respect to such transfer. No transfer of fully registered Bonds shall be required
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to be made during the fifteen 15) days next preceding the selection of Bonds for
redemption nor, in the case of Bonds selected for redemption, after such Bonds have
been selected for redemption.
SECTION 8. Fully registered Bonds may be exchanged at the office of the
designated Transfer Agent/Registrar, for a like aggregate principal amount of Bonds of
the same interest rate and maturity, subject to the terms and conditions provided in
its system of registration for registered debt obligations, upon surrender and
cancellation of the Bond. Upon such transfer and exchange, a new registered Bond
or Bonds of any authorized denomination or denominations of the same maturity for
the same aggregate principal amount will be issued to the transferee in exchange
therefore.
SECTION 9. There shall be kept by the Registrar sufficient books for the
registration and transfer of the Bonds and, upon presentation for such purpose, the
Registrar shall, under such reasonable regulations as it may prescribe, register or
transfer or cause to be registered or transferred, on said register, Bonds as
hereinbefore provided.
SECTION 10. a) The Bonds shall be executed by manual or facsimile signature
by the City Treasurer/Finance Director and attested by the City Clerk and the City seal
shall be imprinted on the Bonds. The Bonds shall then be delivered to the Transfer
Agent and Registrar, for authentication and registration. In case an officer who shall
have signed or attested to any of the Bonds by manual or facsimile signature or
otherwise shall cease to be such officer before the authentication, delivery and
issuance of the Bonds, such Bonds nevertheless may be authenticated, delivered and
issued, and upon such authentication, delivery and issue, shall be as binding as though
those who signed and attested the same had remained in office.
b) Original Delivery. The Bonds shall be initially delivered in a form of a
separate single fully registered Bond which may be typewritten) for each maturity of
the Bonds. Upon initial delivery, the ownership of each such Bond shall be registered
on the Registration Books in the name of the Nominee Cede & Co.). Except as
provided in subsection c), the ownership of all of the Outstanding Bonds shall be
registered in the name of the Nominee on the Registered Books.
With respect to the Bonds the ownership of which shall be registered in the
name of the nominee, the City and the Paying Agent shall have no responsibility or
obligation to any Depository System participant or to any person on behalf of which
the City holds an interest in the Bonds. Without limiting the generality of the
immediately preceding sentence, the City and the Paying Agent shalt have no
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responsibility or obligation with respect to i) the accuracy of the records of the
Depository, the nominee or any Depository System participant with respect to any
ownership interest in the Bonds, ii) the delivery to any Depository System Participant
or any other person, other than an Owner as shown in the Registration Books, of any
notice with respect to the Bonds, including any notice of redemption, iii) the selection
by the Depository of the beneficial interest in the Bonds to be redeemed in the event
the City elects to prepay the bonds in part, iv) the payment to any Depository System
Participant or any person other than an Owner as shown in the Registration Books, of
any amount with respect to the principal, premium, if any, or interest on the Bonds or
iv) any consent given or other action taken by the Depository as Owner of the Bonds.
The City and the Paying Agent may treat and consider the person in whose name each
Bond is registered as the absolute owner of such Bond for the purpose of payment of
principal, premium and interest in such Bond, for the purpose of giving notices of
redemption or other matters with respect to such Bond for the purpose of registering
transfers of ownership of such Bond and for all other purposes whatsoever. The
Paying Agent shall pay the principal of and interest and premium, if any, on the Bonds
only to respective Owners or their respective attorneys duly authorized in writing, and
all such payments shall be valid and effective to fully satisfy and discharge all
obligations with respect to payment of principal of and interest and premium, if any,
on the Bonds to the extent of the sum or sums so paid. No person other than an
Owner shall receive a Bond evidencing the obligation of the City to make payment of
principal, interest and premium, if any, pursuant to the Agreement. Upon delivery by
the Depository to the nominee of written notice to the effect that the Depository has
determined to substitute a new nominee in its place, and subject to the provision
herein with respect to Record Dates, such new nominee shall become the nominee
hereunder for all purposes; and upon receipt of such notice the City shall promptly
deliver a copy of the same to the Paying Agent.
c) ReDresentation Letter. In order to qualify the Bonds for the Depository's
book-entry, the City and the Paying Agent shall execute and deliver to such Depository
a letter representing such matters as shall be necessary to so qualify the Bonds. The
execution and delivery of such letter shall not in any way limit the provisions of
subsection a) above or in any other way impose upon the City or the Paying Agent
any obligation whatsoever with respect to persons having interests in the Bonds other
than the Owners. The Paying Agent agrees to comply with all provision sin such letter
with respect to the giving of notices thereunder by Paying Agent. In addition to the
execution and delivery of such letter, the City may take any other actions, not
inconsistent with the Agreement, to qualify the Bonds of the Depository book-entry
program.
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d) Transfers Outside Book-Entry System. In the event that either i) the
Depository determines not to continue to act as Depository of the Bonds, or ii) the
City determines to terminate the Depository as such, then the City shall thereupon
discontinue the book-entry system with such Depository. In such event, the
Depository shall cooperate with the City and the Paying Agent in the issuance of
replacement Bonds by providing the Paying Agent with a list showing the interests of
the Depository System Participants in the Bonds, and by surrendering the Bonds,
registered in the name of the nominee, to the Paying Agent on or before the date of
such replacement Bonds are to be issued. The Depository, by accepting delivery of
the Bonds, agrees to be bound by the provisions of this subsection c). If, prior to the
termination of the Depository acting as such, then the Bonds shall no longer be
required in whatever name or names the Owners transferring or exchanging Bonds
shall designate, in accordance with the provisions of this Section. Prior to its
termination, the Depository shall furnish the Paying Agent with the names and
addresses of the Depository System Participants and respective ownership interest
thereof.
e) Payments of the Nominee. Notwithstanding any other provisions of the
Agreement to the contrary, so long as any Bond is registered in the name of the
nominee, all payments with respect to principal of and interest and premium, if any,
on such Bond and all notices with respect to such Bond shall be made and given,
respectively, as provided in the letter described in subsection b) above or as otherwise
instructed by the Depository.
SECTION 11. Only such of the Bonds as shall bear thereon a certificate of
authentication substantially in the form below, manually executed by the Transfer
Agent and Registrar, shall be valid or obligatory for any purpose or entitled to the
benefits of this resolution, and such certificate of the Transfer Agent and Registrar
shall be conclusive evidence that the Bonds so authenticated have been duly executed,
authenticated and delivered hereunder, and are entitled to the benefits of this
resolution.
FORM OF CERTIFICATE OF AUTHENTICATION AND REGISTRATION
This bond has been authenticated and registered on
as Registrar and Transfer Agent
By:______________________________
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SECTION 1 2. The person in whose name any Bond shall be registered shall be
deemed and regarded as the absolute owner thereof for all purposes and payment of
or on account of the principal and redemption premium, if any, of any such Bond, and
any payment of interest on any such Bond, shall be made only to or upon the order of
the registered owner thereof or his legal representative. All such payments shall be
valid and effectual to satisfy and discharge the liability upon such Bond, including the
redemption premium, if any, and interest thereon, to the extent of the sum or sums
so paid.
SECTION 1 3. In case any Bond secured hereby shall become mutilated or be
destroyed, stolen or lost, the Registrar shall cause to be executed and authenticated
a new Bond of like date and tenor in exchange and substitution for and upon the
cancellation of such mutilated Bond or in lieu of and in substitution for such Bond
destroyed, stolen or lost, upon the owner?s paying the reasonable expenses and
charges in connection therewith, and, in the case of a Bond destroyed, stolen or lost,
his filing with the Registrar of evidence satisfactory to it and to the City
Treasurer/Finance Director that such Bond was destroyed, stolen or lost, and of his
ownership thereof, and furnishing the Registrar and City with indemnity satisfactory
to them.
SECTION 1 4. All Bonds paid, either at or before maturity, shall be canceled upon
the payment or redemption of such Bonds, and shall be delivered to the Transfer Agent
and Registrar when such payment or redemption is made. All Bonds canceled under
any of the provisions of this resolution shall be destroyed as provided by law by the
Transfer Agent and Registrar, who shall execute a certificate in duplicate describing the
Bonds so destroyed, and shall retain said executed certificate in its permanent files for
the issue.
SECTION 1 5. Pursuant to and the provisions of Part 1 6 commencing with
Section 8880) of Division 10 of the Code from the proceeds received from the sale of
the Bonds, except as provided below, an amount equal to the Reserve Requirement, as
defined below, shall be deposited in a special reserve fund the Reserve Fund") which
the City Treasurer/Finance Director shall establish and maintain. The Reserve Fund shall
be designated and identified as the Assessment District No.98-i La Quinta Norte)
Reserve Fund." The Reserve Fund shall constitute a trust fund for the benefit of the
owners of the Bonds and shall be maintained, used, transferred, reimbursed and
liquidated as follows:
a) Whenever there are insufficient funds in the Redemption Fund to pay the
next maturing installment of the principal of or interest on the Bonds, an
amount necessary to pay such deficiency shall be advanced from the
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Reserve Fund to the Redemption Fund. The amounts so advanced shall
be reimbursed from the proceeds of collection of delinquent assessments
on the redemption or sale of the parcels for which payment of delinquent
installments of assessments and interest thereon has been made from the
Reserve Fund.
b) In the event unpaid assessments are paid in advance, the assessments
thus paid shall be reduced by an amount equal to the ratio of the original
amount of the assessment being prepaid to the total amount originally
assessed in the proceedings represented by Bonds multiplied by the
amount contained in the Reserve Fund, and the amount thus determined
shall be transferred by the City Treasurer/Finance Director from the
Reserve Fund to the Redemption Fund.
c) If on each February 1 5 and August 1 5, of each year, commencing
February 1 5, 1 999, the amount of any income realized from the
investment of the money in the Reserve Fund plus the remaining principal
amount thereof exceeds the lesser of a) maximum annual debt service on
the Outstanding Bonds, b) 1 25% of the average annual debt service on
the Bonds, or c) 10% of the amount within the meaning of Section 148
of the Internal Revenue Code, as amended) of the Bonds the Reserve
Requirement") such excess shall be transferred by the Paying Agent to the
Redemption Fund and applied to the payment of the Bonds.
d) If, on June 30 of the fiscal year next preceding the fiscal year in which
the last unpaid assessment installment becomes due and payable, the
balance in the Reserve Fund is sufficient to retire all or a portion of the
last maturing series of outstanding Bonds, whether by advance retirement
or otherwise, collection of all or a portion of the principal and interest on
the assessments shall be discontinued and at the written direction of the
City the Reserve Fund shall be liquidated in retirement of the Bonds.
SECTION 1 6. The net proceeds from the sale of the Bonds, less the amounts
specified herein for deposit in the Reserve Fund, shall be placed in a fund created
pursuant to Sections 10424 and 10602 of the Code, which shall be held by the City
Treasurer/Finance Director, called the Assessment District No.97-i La Quinta Norte)
Improvement Fund", and the moneys in said fund shall be used only for the purposes
authorized in the assessment proceedings and shall be invested and disbursed to pay
the costs of issuance of the Bonds and the costs of improvements in accordance with
the written direction of the City Treasurer/Finance, Director of Public Works/City
Engineer, or City Manager.
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SECTION 1 7. Principal of and interest on the Bonds shall be paid out of the
Redemption Fund created pursuant to Section 8671 of the Code, to be held and
maintained by the City Treasurer/Finance Director and called the Assessment District
No.97-i La Quinta Norte) Redemption Fund." Accrued interest paid by the purchaser
of the Bonds, if any, shall be deposited in said fund. The City Treasurer/Finance
Director shall deposit, as received, all installments and prepayments of the assessments
with respect to the principal, redemption premiums and interest of the Bonds and the
City Treasurer/Finance Director shall hold all such moneys in said funds and use the
same for the payment of principal, interest and redemption premiums, if any, on the
Bonds.
SECTION 18. The City Treasurer/Finance Director is hereby instructed to cause
Bonds, as set forth above, to be printed, and to proceed to cause said Bonds to be
authenticated and delivered to an authorized representative of the purchaser, upon
payment of the purchase price as set forth in the Bond Purchase Contract for the
Bonds.
SECTION 1 9. in order to maintain the exemption from federal income taxation
of interest on the Bonds, the City covenants to comply with all applicable requirements
of the Internal Revenue Code of 1 986, as amended, and all regulations, rulings and
decisions in connection therewith.
SECTION 20 Except as otherwise provided herein, all moneys held by the
Paying Agent in any of the funds or accounts established pursuant to this resolution
shall be invested as directed in writing by the City Treasurer/Finance Director and all
investment earnings shall be credited to the fund or account so invested. If the Paying
Agent does not receive such written direction, it shall invest such moneys in units of
a taxable government money-market fund. The Paying Agent shall have no liability or
responsibility for any loss resulting from any investment made in accordance with the
provisions of this section or for determining that any directed investment is a permitted
investment.
SECTION 21. U.S. Bank Trust National Association is hereby designated Paying
Agent, Transfer Agent, and Registrar with respect to these proceedings and the Bonds
to be issued. The City Manager, City Treasurer/Finance Director, or Director of Public
Works/City Engineer is hereby authorized to enter into and execute a Paying Agent
Agreement, the form and contents of which shall be approved by the City Manager or
City Treasurer/Finance Director, with the Paying Agent. The City shall from time to
time, subject to any agreement between the City and the Paying Agent then in force,
pay to the Paying Agent compensation for its services, reimburse the Paying Agent for
all its advances and expenditures, including, but not limited to, advances to and fees
and expenses of independent accountants, counsel and engineers or other experts
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employed by it in the exercise and performance of its powers and duties hereunder, and
indemnify and save the Paying Agent harmless against liabilities not arising from its
own negligence or willful misconduct which it may incur in the exercise and
performance of its powers and duties hereunder, which indemnity shall survive
discharge of the Bonds.
SECTION 22. If, after completion of the improvements to be constructed from
the proceeds of the Bonds to be issued hereby, it is determined by the City
Treasurer/Finance Director there is a surplus in the Improvement Fund established
hereby and held by the City Treasurer/Finance Director, upon the written direction of
the City Treasurer/Finance Director, shall transfer such moneys into the Reserve Fund
established pursuant to Section 1 7 up to the Reserve Requirement. Any excess
moneys shall be transferred into the Redemption Fund and such moneys shall be used
for payment of principal of and interest on the Bonds. The amount of such transfer
shall be applied by the City Treasurer/Finance Director as a credit against the
installments of assessments to be collected, in accordance with the provisions of
Sections 10427 and 10427.2, inclusive, of the Code.
SECTION 23. Pursuant to Streets and Highways Code Section 8769, this
Council hereby determines that the City will not obligate itself to advance available
funds from the City Treasury to cure any deficiency which may occur in the
Redemption Fund; provided, however, this determination shall not prevent the City
from, in its sole discretion, advancing funds for such purpose as otherwise provided in
the Improvement Bond Act of 1915.
SECTION 24. The City Council hereby approves the Preliminary Official
Statement and authorizes distribution thereof. The City Manager, the City
Treasurer/Finance Director, or Director of Public Works/City Engineer is hereby
authorized and directed to execute a Final Official Statement consistent therewith. The
City hereby covenants and agrees that it will execute, comply with, and carry out all
of the provisions of the Continuing Disclosure Certificate if directed by Bond Counsel.
Notwithstanding any other provision of this Resolution, failure of the City to comply
with the Continuing Disclosure Certificate shall not be considered an Event of Default;
however, any Bondholder or Beneficial Owner may take such actions as may be
necessary and appropriate, including seeking mandate or specific performance by court
order, to cause the City to comply with its obligations under this Section. For purposes
of this Section, Beneficial Owner" means any person which a) has the power, directly
or indirectly, to vote or consent with respect to, or to dispose of ownership of, any
Bonds including persons holding Bonds through nominees, depositories or other
intermediaries), or b) is treated as the owner of any Bonds for federal income tax
purposes.
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APPROVED AS TO FORM:
DAWN C HONEYWELL, City Attorney
City of La Quinta, California
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SECTION 25. In the event an initiative petition is submitted to the City which
purports to reduce or repeal the assessments levied pursuant to the proceedings taken
hereunder by the City Council, the City Council hereby covenants, to the extent
permitted by law, to commence and pursue, but solely from funds available in the
Assessment District No.97-i La Quinta Norte) Improvement Fund, all available judicial
remedies in order to preserve and protect the assessments and any installments thereof
and the lien securing said assessments.
SECTION 26. The terms and conditions of this resolution relating to the terms
and conditions of the bonds and other non-substantive terms and provisions of this
Resolution, as determined by Bond Counsel, may be amended and modified prior to
closing of delivery of the Bonds by a written amendment executed by the City Manager,
City Treasurer/Finance Director, or Director of Public Works/City Engineer and
countersigned by Bond Counsel.
PASSED, APPROVED and ADOPTED this 3rd day of November, 1998 at a regular
Council Meeting by the following vote:
AYES: Council Members Adolph, Henderson, Perkins, Sniff, Mayor Pena
NOES: None
ABSENT: None
ABSTAIN: None
JO r
City of La Quinta, California
ATTEST:
RA L. JUHOLA, City Clerk
City of La Quinta, California
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STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
CITY OF LA QUINTA
I, SAUNDRA L. JUHOLA, City Clerk of the City of La Quinta, California, do
hereby certify that the foregoing Resolution No. 98-126 is a full, true and correct copy
as adopted by the City Council on November 3, 1 998.
Dated: November 5, 1 998
L??73?
SAUNDRA L. JU?OLA, City Clerk
City of La Quinta, California
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