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Home My WebLink About10340RESOLUTION NO. 10340 A RESOLUTION OF THE CITY COUNCIL OF PUEBLO, A MUNICIPAL CORPORATION APPROVING THE ISSUANCE BY THE URBAN RENEWAL AUTHORITY OF PUEBLO, COLORADO OF THE AUTHORITY'S REFUNDING REVENUE BONDS (PHASE ONE URBAN RENEWAL PROJECT), SERIES 2005; APPROVING AN INDENTURE OF TRUST, ESCROW AGREEMENT AND BOND PURCHASE AGREEMENT IN CONNECTION WITH THE ISSUANCE OF THOSE BONDS; APPROVING CERTAIN ACTIONS OF THE AUTHORITY HERETOFORE TAKEN AND TO BE TAKEN HEREAFTER WITH RESPECT TO THE ISSUANCE OF THE BONDS WHEREAS, the Urban Renewal Authority of Pueblo, Colorado (the "Authority ") issued $7,275,000 in aggregate principal amount of its Revenue Refunding Bonds (Phase One Urban Renewal Project) Series 1994A, of which $5,465,000 remains outstanding (the "1994A Bonds "), and $2,225,000 aggregate principal amount of its Subordinate Revenue Refunding Bonds (Phase One Urban Renewal Project) Series 1994B, of which $1,780,000 remains outstanding (the "1994B Bonds ") (collectively, the "Refunded Bonds "), under and pursuant to an Indenture of Trust, originally dated as of August 15, 1994, as amended and restated pursuant to a First Amended and Restated Indenture of Trust dated as of December 1, 1996 (collectively, the "Original Indenture ") by and between the Authority and American National Bank (formerly called The Bank of Cherry Creek, N.A.), as trustee (the "Trustee "), in order to finance certain public improvements in connection with the Phase One Urban Renewal Project (the "Project ") (as defined in the Original Indenture); and WHEREAS, the Authority, by and through its Board of Commissioners (the "Board "), has determined that it is in the best interest of the Authority and its constituents, including the residents of the City of Pueblo (the "City "), to issue its Refunding Revenue Bonds (Phase One Urban Renewal Project), Series 2005 (the "Bonds ") in an aggregate principal amount large enough to provide an escrow for the purpose of refunding the Refunded Bonds; and WHEREAS, there have been presented to the City Council at this meeting a proposed form of the Indenture of Trust, dated as of February 15, 2005 (the "Indenture "), by and between the Authority and American National Bank, as trustee (the "Trustee "), an Escrow Agreement, dated as of March 3, 2005 (the "Escrow Agreement "), by and between the Authority and the Trustee, as escrow agent, a Bond Purchase Agreement, dated February 25, 2005 (the "Bond Purchase Agreement "), and other documents necessary to the issuance, sale and delivery of the Bonds; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. All actions not inconsistent with the provisions of this Resolution heretofore taken by any of the officials of the Authority or the City, and the efforts of the officials of the Authority and the City directed toward the issuance, sale and delivery of the Bonds, are hereby ratified and approved. SECTION 2 The form, terms and provisions of the Indenture and the Escrow Agreement are hereby approved, and approval is granted to the Authority to enter into the Indenture and the Escrow Agreement substantially in the forms presented to the City Council at this meeting, but with such changes therein as shall be consistent with this Resolution and as the Chairman of the Board and the Authority's counsel and the City's counsel shall approve, the execution thereof being deemed conclusive of the approval of any such changes. SECTION 3 The form, terms and provisions of the Bond Purchase Agreement are hereby approved, and the approval is granted to Authority to enter into the Bond Purchase Agreement substantially in the form presented to the City Council at this meeting, but with such changes therein as shall be consistent with this Resolution and as the Chairman of the Board and the Authority's counsel and the City's counsel shall approve, the execution thereof being deemed conclusive of the approval of any such changes. The sale of the Bonds by the Authority to George K. Baum & Company at the respective purchase price set forth in the Bond Purchase Agreement, in the manner and at the time set forth in the Bond Purchase Agreement is hereby approved. SECTION 4 The issuance and sale of the Bonds, in a principal amount not to exceed $7,500,000 and bearing interest at rates to be determined, but not to exceed a maximum net effective interest rate of 5.00 %, and the form, terms and provisions of the Bonds, in substantially the form set forth in the Indenture, are hereby approved, with such changes therein as shall be consistent with the Indenture and this Resolution and which the officers of the Authority executing the Bonds shall approve, their execution thereof being deemed conclusive of their approval of any such changes. SECTION 5 Approval is hereby given to the officers of the Authority to take all action necessary or reasonably required or desirable to finance the cost of the refunding from the proceeds of the Bonds and for carrying out the transactions contemplated by this Resolution and the Indenture and the Escrow Agreement, and to execute and deliver any closing and other documents required in connection with the sale and delivery of the Bonds. SECTION 6 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. SECTION 7 All bylaws, orders and resolutions, or parts thereof inconsistent herewith or with the documents hereby approved are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed as reviving any bylaw, order, resolution or ordinance, or part thereof. INTRODUCED February 28, 2005 M Michael Occhiato Councilperson APPROVED: ATTESTED BY: CITY CLERK M OWN I WORMS ,w- pi glLimaell 1, T: �0 0 0 Background Paper for Proposed RESOLUTION P DATE: February 28, 2005 DEPARTMENT: Law Department TITLE &p -`103A) AGENDA ITEM # AO A RESOLUTION OF THE CITY COUNCIL OF PUEBLO, A MUNICIPAL CORPORATION APPROVING THE ISSUANCE BY THE URBAN RENEWAL AUTHORITY OF PUEBLO, COLORADO OF THE AUTHORITY'S REFUNDING REVENUE BONDS (PHASE ONE URBAN RENEWAL PROJECT), SERIES 2005; APPROVING AN INDENTURE OF TRUST, ESCROW AGREEMENT AND BOND PURCHASE AGREEMENT IN CONNECTION WITH THE ISSUANCE OF THOSE BONDS; APPROVING CERTAIN ACTIONS OF THE AUTHORITY HERETOFORE TAKEN AND TO BE TAKEN HEREAFTER WITH RESPECT TO THE ISSUANCE OF THE BONDS ISSUE Should the City Council adopt the Resolution approving the Urban Renewal Authority of Pueblo, Colorado ( "Authority ") issuance of refunding bonds? RECOMMENDATION Adopt the Resolution. BACKGROUND The Authority intends to issue refunding bonds in the amount of approximately $7.5 million to refund its existing $9.5 million bonds having a principal balance of approximately $7.3 million. The refunding will result in the release of $808,000 in bond trust funds, the disposition and use of which are set forth in Amendment No. 2 to the Cooperation Agreement approved by the City Council on January 24, 2005. The refunding will also result in a net present value savings of approximately $1.4 million in future principal and interest payments. The most recent financial information is attached. FINANCIAL IMPACT See Background. Pueblo Urban Renewal Authority Pueblo, Colorado Revenue Refunding Bonds Series 2004A AAA Insured, +20 over MMD SOURCES & USES SOURCES Par Amount 7,260,000.00 Supplemental Reserve Fund Contribution and Tax Increment Revenue 808,000.00 Contributions to Escrow Fund (From Bond Retirement Fund) 338,000.00 DSRF From Series 2004A & 2004B 754,000.00 Original Issue (Discount) / Premium - 74,380.85 Accrued Interest - Total 9,234,38 .85 USES 3/1/2005 Delivery Date _ 3/1/2005 Deposit to Escrow Account 6/1/2005 Last Maturity Date 7,508,151.80 Contribution to Escrow Fund (From Bond Retirement Fund) 338,000.00 Series 1994A Premium 100% DSRF 12/1/2006 Series 19948 Premium 100.0% SNP'plemental Reserve Fund Contribution and Tax Increment Revenue 12/12006 RESULTS _695460.00 ;_:' (funds fio Authority) 3.670189% True Interest Cost 3.792295% Bond Insurance 75 BP Average Life 72,483.98 Underwriter'& Discount $9.001 ;1000 Average Coupon 65,34D.00 Cost of Issuance Savings 1,627,710.38 Legal Fees 60,000 Average Annual Savings 52,675.17 American National Bank- Trustee and Escrow Trustee 2,800 DEBT SERVICE RESERVE FUND REQUIREMENT CALCULATION CPA Escrow Verification 2,000 10% of Par 726,000.00 CUSIPS, CMBDA Fees, DTC, etc 2,000 125% of Average Annual Debt Service 819,028.05 POS/OS Printing and Distribution 4,000 Standard and Pool's Refing Fee 9,000 Bond Allocation 2,000 Miscellaneous (Internal Printing, etc) 2,500 Total 84,300 84,300.01) Accrued Interest - Rounding Amount 645.06 Total . ASSUMPTIONS Dated Date 3/1/2005 Delivery Date _ 3/1/2005 First Interest Date 6/1/2005 Last Maturity Date 1211/2019 Series 1994A Call Date 6/12005 Series 1994A Premium 100% Series 19948 Call Date 12/1/2006 Series 19948 Premium 100.0% Final Escrow Date 12/12006 RESULTS Arbitrage Yield 3.670189% True Interest Cost 3.792295% Net Interest Cost 3.894164% Average Life 8.999 Term 14.75 Average Coupon 3.680311% SAVINGS Savings 1,627,710.38 Net Present Value Savings 1,379,666.42 Average Annual Savings 52,675.17 Net Present Value Savings as a Percentage of Refunded Debt 19.042% DEBT SERVICE RESERVE FUND REQUIREMENT CALCULATION The Lesser of. 10% of Par 726,000.00 100% of Maximum Annual Debt Service 695,460.00 125% of Average Annual Debt Service 819,028.05 Pueblo Urban Renewal Authority Pueblo, Colorado Revenue Refunding Bonds Series 2004A SAVINGS REPORT Adjustments at Closing 645.06 Issuer Bond Fund Contributed - Change in DSRF (58,540.00) Net Savings 1,627,710.38 PV of Net Savings @ Arb Yield 1,379,566.42 Percent of Refunded 19.042% let Period Savings 422,445.38 1994A & B Refunding Annual Present Value Date Debt Service Debt Service Savings Savings Savings 6/12005 223,897.50 65,331.56 158,565.94 157,130.74 12/12005 533,897.50 270,663.13 263,234.38 421,800.31 256,151.20 6/12006 214,598.13 128,388.13 86,210.00 82,378.52 12/12006 539,598.13 208,388.13 331,210.00 417,420.00 310,786.61 6/12007 204,863.75 127,088.13 77,775.63 71,664.63 12/12007 554,863.75 567,088.13 (12,224.38) 65,551.25 (11,060.90) 6/12008 194,363.13 119,938.13 74,425.00 66,127.98 12/12008 564,363.13 574,938.13 (10,575.00) 63,850.00 (9,226.76) 6/12009 163,261.88 112,544.38 70,717.50 60,589.64 12/12009 573,261.88 577,544.38 (4,282.50) 66,435.00 (3,603.06) 6/12010 171,560.00 104,988.13 66,571.88 55,000.59 12/12010 586,560.00 584,988.13 1,571.88 68,143.75 1,275.26 6/12011 158,718.75 97,188.13 61,530.63 49,019.96 12/12011 593,718.75 587,188.13 6,530.63 68,061.25 5,109.04 6112012 145,258.13 88,613.13 56,645.00 43,515.93 12/12012 610,258.13 603,613.13 6,645.00 63,290.00 5,012.84 6/12013 130,861.25 79,150.00 51,711.25 38,306.86 12/12013 625,861.25 614,150.00 11,711.25 63,422.50 8,519.17 6/12014 115,448.75 68,450.00 46,998.75 33,572.46 12/12014 640,448.75 623,450.00 16,998.75 63,997.50 11,923.84 6/12015 99,095.00 57,350.00 41,745.00 26,754.53 12/12015 659,095.00 637,350.00 21,745.00 63,490.00 14,708.34 6/12016 81,647.50 46,910.00 34,737.50 23,073.07 12/12016 671,647.50 641,910.00 29,737.50 64,475.00 19,396.08 6112017 63,160.63 36,200.00 26,960.63 17,268.00 12/12017 693,160.63 656,200.00 36,960.63 63,921.25 23,246.30 6/12018 43,420100 24,730.00 18,690.00 11,64320 12/12018 713,420.00 664,730.00 48,690.00 67,380.00 29,529.72 6/12019 22,413.75 12,730.00 9,683.75 5,767.21 12/12019 737,413.75 682,730.00 54,683.75 64,367.50 31,980.33 11,350,136.25 9,664,530.94 1,685,605.31 1,685,605.31 1,437,461.35 Adjustments at Closing 645.06 Issuer Bond Fund Contributed - Change in DSRF (58,540.00) Net Savings 1,627,710.38 PV of Net Savings @ Arb Yield 1,379,566.42 Percent of Refunded 19.042% let Period Savings 422,445.38