RES 88015 - Laserfiche WebLink

separately from property tax payments. Therefore, the unwillingness or inability of a property owner to pay re .~.lar property tax bills, as evidenced by property tax delinquencies, may also indicate an unwillingness or ~nability to make regular property tax payments and assessment installment payments in the future. A failure of property owners to pay installments of assessments when due could result in the rapid total depletion of the Reserve Fund prior to reimbursement from the resales of property or delinquency redemptions. In that event, there could be a default in ayments of the principal of and interest on the Bonds. Based on the records of the AlameoPZ County Tax Collector, none of the parcels in the Assessment Distric~ had outstanding delinquent property taxes as of July 1, 1987. See the sections hereof entitled "SECURITY FOR THE BONDS - Reserve Fund and - Covenant to Commence Superior Court Foreclosure", for provisions that apply and h the City is obligated to follow in the event of a dehnquency in the payments of procedures t at assessment installments. Bankruptcy The payment of assessment installments and the ability of the City to foreclose on the lien of a delinquent unpaid assessment, as discussed in the section herein entitled "SECURITY FOR THE BONDS", may be limited by bankruptcy, insolvenc7 or other laws generally affecting creditors' rights or by the laws of California relating to judicial foreclosure. The various legal opinions to be delivered concurrently with the delivery of the Bonds, 1 f inc uding Bond Counsel's approving legal opinion, will be qualified, as to the en orceability of the various le al instruments, by reference to bankruptcy, reorganization, insolvency or other similar laws a~f~cting the rights of creditors generally. Although bankruptcy proceedings would not cause the assessment liens to become extinguished, ankruptcy of a property owner in all likelihood would result in a delay in rosecuting superior court foreclosure proceedings. Such a delay would increase the Fikelihood of a delay or default in payment of the principal of and interest on the Bonds, and the possibility that delinquent assessment installments rmght not be paid in full. Loss of Tax Exemption As discussed under the caption "MISCELLANEOUS - Tax Exemption" herein, interest on the Bonds could become includable in gross income for purposes of federal income taxation, retroactive to the date the Bonds were issued, as a result of future acts or omissions of the City in violation of its covenants in the Resolution of Issuance.