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AN ORDINANCE AUTHORIZING A GUARANTY AGREEMENT WHEREBY THE CITY OF PORTSMOUTH WILL GUARANTEE 22% OF NOT TO EXCEED $4,000,000 HAMPTON ROADS REGIONAL JAIL AUTHORITY VARIABLE RATE BOND ANTICIPATION GUARANTEED LINE OF CREDIT NOTE, SERIES 1994 (TIDEWATER REGIONAL JAIL PROJECT) BE IT ORDAINED by the Council of the City of Portsmouth: Section I. The City of Portsmouth (herein called the "City") has found and determined and does hereby declare that: (a) The Hampton Roads Regional Jail Authority (the "Authority") is a public instrumentality of the Commonwealth of Virginia created pursuant to Article 3.1, Chapter 3, Title 53.1. Code of Virgima of 1950, as amended (the "Act") by resolutions duly adopted by the City of Norfolk on November 23. 1993. the City of Newport News on December 14. 1993, the City of Portsmouth on October 12. 1993 and the City of Hampton on November 10, 1993 (collectively, the "Guaranteeing Units"), for the purpose of financing the acquisition, construction and operation of a regional jail facility to be located in the City of Portsmouth (the "Regional Jail") for the benefit of the Guaranteeing Units. (b) The Authority intends to adopt a resolution (herein called the "Resolution" } prOviding for the issuance of its not to exceed Four Million Dollar ($4,000,000) Hampton Roads Regional Jail Authority Variable Rate Bond Anticipation Guaranteed L'me of Credit Note (Tidewater Regional Jail Project), Series 1994 (the "Note") for the purpose of providing funds for payment of the cost of architectural, engineering and other project development expenses with respect to the Regional Jail (the "Project"). tc) The Guaranteeing Units have determined that it is necessary and proper and in their best interests to enter into a Guaranty Agreemem (the "Guaranty Agreement") and to agree severally to guarantee pro rata the payment of the principal of and the interest on the Notes when due. whether at maturity or by redemption or otherwise. (d) A public hearing on the Project and the City's obligations under the Guaranty Agreement has been held and notice thereof has been published in accordance with the reqmremems of Section 15.1-227.8 of the Code of Virginia of 1950, as amended, and the Authority has informed the City that the Authority intends to designate the Note as a "qualified tax-exempt obligation" under Section 265(b) of the Internal Revenue Code of 1986. as amended (the "Code"), to encourage its purchase by commercial banks and similar financial institutions. 85432.1/GRF:LQ:JLS 9/19/94