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HomeMy WebLinkAbout09104RESOLUTION NO. 9104 A RESOLUTION AUTHORIZING ASSIGNMENT TO THE COLORADO HOUSING FINANCE AUTHORITY OF A PRIVATE ACTIVITY BOND ALLOCATION OF THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, FOR THE PURPOSE OF PROVIDING SINGLE- FAMILY MORTGAGE LOANS, PURSUANT TO THE COLORADO PRIVATE ACTIVITY BOND CEILING ALLOCATION ACT. WHEREAS, the City of Pueblo, a municipal corporation (the "City ") is authorized and empowered under the laws of the State of Colorado (the "State ") to issue revenue bonds for the purpose of providing single - family mortgage loans to low- and moderate - income persons and families; and WHEREAS, the Internal Revenue Code of 1986, as amended (the "Code "), restricts the amount of tax - exempt bonds ( "Private Activity Bonds ") which may be issued in the State to finance such rental housing projects and for certain other purposes (the "State Ceiling "); and WHEREAS, pursuant to the Code, the Colorado legislature adopted the Colorado Private Activity Bond Ceiling Allocation Act, Part 17 of Article 32 of Title 24, Colorado Revised Statutes (the "Allocation Act "), providing for the allocation of the State Ceiling among the Colorado Housing and Finance Authority (the "Authority ") and other governmental units in the State, and further providing for the assignment of such allocations from such other governmental units to the Authority; and WHEREAS, pursuant to an allocation under Section 24 -32 -1706 of the Allocation Act, the City has an allocation of the 2000 State Ceiling for the issuance of a specified principal amount of Private Activity Bonds prior to September 15, 2000 (the "2000 Allocation "); and WHEREAS, the City has determined that, in order to increase the availability of adequate affordable housing by low- and moderate - income persons and families within the City and elsewhere in the State, it is necessary or desirable to provide for the utilization of all or a portion of the 2000 Allocation; and WHEREAS, the City has determined that the 2000 Allocation, or a portion thereof, can be utilized most efficiently by assigning it to the Authority to issue Private Activity Bonds for the purpose of providing single - family mortgage loans to low- to moderate - income persons and families; and WHEREAS, the City Council of the City of Pueblo has determined to assign $1,284,462.50 of its 2000 Allocation to the Authority, which assignment is to be evidenced by an Assignment of Allocation between the City and the Authority (the "Assignment of Allocation "), attached hereto as Exhibit A. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, as follows: 1. The assignment to the Authority of $1,284,462.50 of the City of Pueblo's 2000 Allocation be and hereby is approved. 2. The form and substance of the Assignment of Allocation be and hereby is approved: provided, however, that the City Council be and hereby are authorized to make such technical variations, addition or deletions in or to such Assignment of Allocation as they shall deem necessary or appropriate and not inconsistent with the approval thereof by this resolution. 3. The President of the City Council of the City of Pueblo be and hereby is authorized to execute and deliver the Assignment of Allocation on behalf of the City of Pueblo and to take such other steps or actions as may be necessary, useful or convenient to effect the aforesaid assignment in accordance with the intent of this resolution. 4. If any section, paragraph, clause, or provision of this resolution shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, clause, or provision shall not affect any of the remaining provisions of this resolution. 5. This resolution shall be in full force and effect upon its passage and approval. INTRODUCED: September 11, 2000 ATTEST: Gin utcher City Clerk B Al Guru 1 e Councilperson APP ED: Corinne Koehler, President of the City Council COUNCIL AGENDA Agenda Item # A RESOLUTION AUTHORIZING ASSIGNMENT TO THE COLORADO HOUSING FINANCE AUTHORITY OF A PRIVATE ACTIVITY BOND OF THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, FOR THE PURPOSE OF PROVIDING SINGLE- FAMILY MORTGAGE LOANS, PURSUANT TO THE COLORADO PRIVATE ACTIVITY BOND CEILING ALLOCATION ACT; AND AUTHORIZING ITS EXECUTION; AND PROVIDING THE EFFECTIVE DATE OF THIS RESOLUTION Department: Housing & Community Development I. SUMMARY A. ISSUE: Date: September 11, 2000 This Resolution will allow the City of Pueblo to assign to the Colorado Housing and Finance Authority (CHFA) approximately $1.2 Million awarded to the City pursuant to the Colorado Private Activity Bond Ceiling Allocation Act. These are private activity bonds and will be used for mortgage origination funds for low- and moderate - income persons and families who are homebuyers within Pueblo County including the City of Pueblo. B. RECOMMENDATION: Approve the Resolution, thus authorizing CHFA to administer on behalf of the City of Pueblo its bond allocation in the amount of $1.2 Million for single- family mortgage loans for homebuyers. II. BACKGROUND The City of Pueblo has been awarded $2,563,925 Million of the 2000 bond ceiling for the State of Colorado. During the period of January to December 1999, CHFA provided $8.5 Million in first mortgage loans, through local lenders, to families in the City of Pueblo. III. FINANCIAL IMPACT This assignment of allocation between the City of Pueblo and CHFA will consist of half of the year 2000 Direct Allocation of Private Activity Bond allocation of $2,568,925. The average loan is expected to be $73,549, based on historical data. The program is expected to assist 60 -70 individuals and families to obtain a first mortgage loan. Eligible homebuyers must live within Pueblo County and considered low- to moderate - income as defined under the CHFA MRB program. IV. ALTERNATIVES A. The City could elect not to authorize the assignment and to issue the mortgage bond funds through its own originations. B. The City could elect to let the allocation revert back to the State. C. The City could elect to approve the assignment of allocation to CHFA. ASSIGNMENT OF ALLOCATION This Assignment of Allocation (the "Assignment "), dated this 11 day of September 2000, is between the City of Pueblo (the "Assignor ") and the Colorado Housing and Finance Authority (the "Assignee "). WITNESSETH: WHEREAS, the Assignor and the Assignee are authorized and empowered under the laws of the State of Colorado (the "State ") to issue revenue bonds for the purpose of providing single - family mortgage loans to low- and moderate - income persons and families; and WHEREAS, the Internal Revenue Code of 1986, as amended (the "Code "), restricts the amount of tax- exempt bonds ( "Private Activity Bonds ") which may be issued in the State to provide such mortgage loans and for certain other purposes (the "State Ceiling "); and WHEREAS, pursuant to the Code, the Colorado legislature adopted the Colorado Private Activity Bond Ceiling Allocation Act, Part 17 of Article 32 of Title 24, Colorado Revised Statutes (the "Allocation Act "), providing for the allocation of the State Ceiling among the Assignee and governmental units in the State, and further providing for the assignment of allocations from such other governmental units to the Assignee; and WHEREAS, pursuant to an allocation under Section 24 -32 -1706 of the Allocation Act, the Assignor has an allocation of the 2000 State Ceiling for the issuance of a specified principal amount of Private Activity Bonds prior to September 15, 2000 (the "2000 Allocation "); and WHEREAS, the Assignor has determined that, in order to increase the availability of adequate affordable housing for low- and moderate - income persons and families within the City of Pueblo and elsewhere in the State, it is necessary or desirable to provide for the utilization of all or a portion of the 2000 Allocation; and WHEREAS, the Assignor has determined that the 2000 Allocation, or a portion thereof, can be utilized most efficiently by assigning it to the Assignee to issue Private Activity Bonds for the purpose of providing single - family mortgage loans to low- and moderate - income persons and families ( "Revenue Bonds "), and the Assignee has expressed its willingness to attempt to issue Revenue Bonds with respect to the 2000 Allocation; and WHEREAS, the City Council of the Assignor has determined to assign to the Assignee $1,284,462.50 of its 2000 Allocation, and the Assignee has agreed to accept such assignment, which is to be evidenced by this Assignment. NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the parties hereto agree as follows: 1. The Assignor hereby assigns to the Assignee $1,284,462.50 of its 2000 Allocation, subject to the terms and conditions contained herein. The Assignor represents that it has received no monetary consideration for said assignment. 2. The Assignee hereby accepts the assignment to it by the Assignor of $1,284,462.50 of Assignor's 2000 Allocation, subject to the terms and conditions contained herein. The Assignee agrees to use its best efforts to issue and sell Revenue Bonds, in one or more series, and to make proceeds of such Revenue Bonds available from time to time during the period of two (2) years from the date of this Assignment for the purchase of mortgage loans in at least the aggregate amount of $1,284,462.50 to finance single - family housing facilities located in the City of Pueblo. Unless otherwise agreed to in writing, the mortgage loans will be subject to all applicable current requirements of Assignee's mortgage revenue bond program, including Assignee's income and purchase price limits. 3. The Assignor hereby consents to the election by the Assignee, if the Assignee in its discretion so decides, to treat all or any portion of the assignment set forth herein as an allocation for a project with a carryforward purpose. 4. The Assignor and Assignee each agree that it will take such further action and adopt such further proceedings as may be required to implement the terms of this Assignment. 5. Nothing contained in this Assignment shall obligate the Assignee to finance mortgage loans in any particular amount or at any particular interest rate or to use any particular percentage of the proceeds of its Revenue Bonds to provide mortgage loans to finance single- family housing facilities located in the City of Pueblo. 6. This Assignment is effective upon execution and is irrevocable. IN WITNESS WHEREOF, the parties hereto have duly executed this Assignment on the date first written above. CITY OF EBLJCjLRADO [SEAL] ATTEST: By: ' - President of the City Council By: City C16k [SEAL] IJ ATTEST: By: COLORADO HOUSING FINANCE AUTHORITY By: VA Executive Director D U D D ° City of Pueblo September 11, 2000 OFFICE OF THE CITY ATTORNEY 127 Thatcher Building PUEBLO, COLORADO 81003 Colorado Housing and Finance Authority 1981 Blake Street Denver, Colorado 80202 -1272 Gentlemen: I am an attorney duly admitted to practice in the State of Colorado (the "State "). I have acted as counsel for the City of Pueblo, a municipal corporation (the "City "), in connection with the assignment by the City to the Colorado Housing and Finance Authority (the "Authority ") of the City's allocation of the ceiling on private activity bonds which may be issued in the State during the period from January 1 to December 31, 2000 (the "2000 Allocation "), under Part 17 of Article 32 of Title 24 of the Colorado Revised Statutes (the "Allocation Act "). This assignment is being effected pursuant to a Resolution adopted by the City Council of City on September 11, 2000 and an Assignment of Allocation dated September 11, 2000 (the "Assignment of Allocation "), between the City and the Authority. I have examined, among other things, a copy of the Resolution and the Assignment of Allocation. I have also examined the Constitution of the State and such statutes and regulations as I deemed appropriate, including, without limitation, the charter of the City, certificates of public officials and of officers and representatives of the City, and such other documents as I have deemed necessary as a basis for the opinions hereinafter expressed. In the course of such examinations, I have assumed the genuineness of all signatures and the authenticity of all documents submitted to me as copies. Based upon the foregoing, it is my opinion that: 1. The City of Pueblo, a municipal corporation is a City validly existing under the Constitution and the laws of the State. 2. The City has full legal right, power and authority: (a) to assign its 2000 Allocation, or a portion thereof, in accordance with the Resolution and the Assignment of Allocation; (b) to adopt the Resolution; (c) to execute and deliver the Assignment of Allocation; and (d) to perform its obligations under the Resolution. 3. The adoption or the execution and delivery and the performance of the City of the Resolution and the Assignment of Allocation and the performance of the City's obligations thereunder have been duly authorized by the City, and each of them have been duly adopted or executed and delivered by the City, and each of them constitute valid and binding obligations of the City enforceable in accordance with its terms. Colorado Housing and Finance Authority September 11, 2000 Page 2 4. The adoption of the Resolution and the execution and delivery of the Assignment of Allocation and compliance with the terms, conditions and provisions of each thereof by the City will not conflict with or result in a breach or violation of any of the terms, conditions or provisions of the Constitution or the laws of the State, local ordinances, resolutions, charter, bylaws, or other regulations, or any other governmental authority of any nature whatsoever as now existing, or to the best of my knowledge, any agreement or instrument to which the City is now a party or by which it is bound, or constitute a default thereunder. 5. With respect to the 2000 Allocation, or a portion thereof, being assigned to the Authority pursuant to the Resolution and the Assignment of Allocation, the City has not: (a) issued private activity bonds; (b) assigned the allocation to another "issuing authority" as such term is defined in the Allocation Act; (c) made a mortgage credit certificate election; or (d) treated the allocation as an allocation for a project with a carryforward purpose. 6. No approval, permit, consent or authorization applicable to the City and not already obtained by the City of any government or public agency, authority or person is required in connection with the adoption of the execution and delivery by the City of, and the performance by it of its obligations under, the Resolution and the Assignment of Allocation. This opinion may be relied upon by: (1) the Authority's Bond Counsel in rendering its opinion in connection with the issuance by the Authority of revenue bonds, and (ii) each institution which may act as an underwriter of any such revenue bonds. Very truly yours, Thomas E. ger ._ sm