RES 87418 - Laserfiche WebLink

City's Rental Payments The City's Rental Payments and other payments due under the Lease (including payment of costs of improvements, repair and maintenance of the Project, taxes and other governmental charges and assessments levied against the Projects) are not secured by any pledge of taxes or other revenues of the City, but are payable from any funds lawfully available to the City. In the event the City's revenue sources are less than its total obligations, the City could choose to fund other municipal services before making Rental Payments. The same result could occur if, because of State ConsTitutional limits on expenditures, the City is not permitted to appropriate and spend all of its available revenues. The City's appropriations currently exceed the base-line limitation on appropriations under Article XIIIB of the California Constitution pursuant to approval by the voters on April 8, 1986. The California Constitution requires that any over-ride of such appropriations limitation be submitted to the voters of the City at least every four years. See "CONSTITUTIONAL AND STATUTORY LIMITATIONS ON TAXES AND APPROPRIATIONS." No Liability by the Lessor to the Owners Except as expressly provided in the Trust Agreement, the Lessor shall not have any obligation or liability to the Owners of the Certificates of Participation with respect to the payment when due of the Rental Payments by the City, or with respect to the observance or performance by the City of other agreements, conditions, covenants and terms required to be observed or performed by it contained in the Lease or the Trust Agreement, or with respect to the performance by the Trustee of any obligation required to be performed by it contained in the Trust Agreement. Limited Recourse on Default If the City defaults on its obligations to make Rental Payments with respect to the Project, the Trustee, as assignee of the Lessor, may retain the Lease and hold the City liable for all Rental Payments on an annual basis and will have the right to re-enter and re-let the Project. Such re-entry and re-letting shall not effect a surrender of the Lease. Alternatively, the Trustee may terminate the Lease and proceed against the City to recover damages pursuant to the Lease. Due to the specialized nature of the Project, no assurance can be given that the Trustee will be able to re-let the Projects so as to provide rental income sufficient to make principal and interest payments with respect to the Certificates in a timely manner, and the Trustee is not empowered to sell the Project 31