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HomeMy WebLinkAbout12173 RESOLUTION NO. 12173 A RESOLUTION APPROVING THE ISSUANCE BY THE URBAN RENEWAL AUTHORITY OF PUEBLO, COLORADO, OF THE AUTHORITY’S TAXABLE REFUNDING REVENUE BONDS, SERIES 2011A AND TAX-EXEMPT REFUNDING AND IMPROVEMENT REVENUE BONDS, SERIES 2011B; APPROVING AN INDENTURE OF TRUST, ESCROW AGREEMENT AND BOND PURCHASE AGREEMENT IN CONNECTION WITH THE ISSUANCE OF THOSE BONDS; AND 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 $7,310,000 in aggregate principal amount of its Refunding Revenue Bonds (Phase One Urban Renewal Project) Series 2005, of which $5,245,000 remains outstanding (the “Series 2005 Bonds” or the “Refunded Bonds”), under and pursuant to an Indenture of Trust, dated as of February 15, 2005, (the “2005 Indenture”) by and between the Authority and UMB Bank, n.a., as successor trustee to American National Bank (the “2005 Trustee”), in order to finance the refunding on a current basis of the Authority’s Revenue Refunding Bonds (Phase One Urban Renewal Project), Series 1994A (the “Series 1994A Bonds”) and the advance refunding of the Authority’s Subordinate Revenue Refunding Bonds (Phase One Urban Renewal Project), Series 1994B Bonds (the “Series 1994B Bonds”), which bonds were originally issued on August 15, 1994, to provide funds for the acquisition, construction, improvement and equipping of a convention center for the City of Pueblo (the “City”) and to provide certain public infrastructure for the convention center and for a private convention center hotel (as defined in the Indenture, defined below, the “Convention Center Project”); and WHEREAS, the Authority now desires to finance the remodeling and restoration of the City’s historic Memorial Hall building (“Memorial Hall”); and WHEREAS, the City and the Authority therefore presented to the electorate of the City Question 2B at the election held on November 2, 2010, and the voters approved said question; and WHEREAS, among other actions, Question 2B authorized the issuance of revenue bonds by the Authority in an amount of up to $10,000,000 for the purpose of financing the remodeling and restoration of the historic Memorial Hall (the “Memorial Hall Project”); and WHEREAS, certain provisions of the Indenture for the Series 2005 Bonds limit the Authority’s ability to issue additional obligations on terms favorable to the Authority; and WHEREAS, because a portion of the net proceeds of the Series 2005 Bonds were used to effect an advance refunding of the Series 1994B Bonds, the Authority now is prohibited from advance refunding that portion of the Series 2005 Bonds on a tax- exempt basis; 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, to issue its Taxable Refunding Revenue Bonds, Series 2011A (the “Series 2011A Bonds”) in an aggregate principal amount not to exceed $1,750,000, and its Tax-Exempt Refunding and Improvement Revenue Bonds, Series 2011B (the “Series 2011B Bonds” and, along with the Series 2011A Bonds, the “Bonds”) in an aggregate principal amount not to exceed $15,000,000; and WHEREAS, the net proceeds of the Series 2011A Bonds will be used to finance the advance refunding of that portion of the Series 2005 Bonds used to advance refund the Series 1994B Bonds, and a portion of the net proceeds of the Series 2011B Bonds will be used to finance the advance refunding of that portion of the Series 2005 Bonds used to refund the Series 1994A Bonds on a current basis, and the remainder of the net proceeds of the Series 2011B Bonds will be used to finance the Memorial Hall Project; and WHEREAS, there have been presented to the City Council at this meeting a proposed form of the Indenture of Trust, dated as of June 1, 2011 (the “Indenture”), by and between the Authority and UMB Bank, n.a., as trustee (the “Trustee”), an Escrow Agreement, dated as of June 1, 2011 (the “Escrow Agreement”), by and between the Authority and the Trustee, as escrow agent, a Bond Purchase Agreement, dated as of the date the Bonds are actually sold (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 such changes. SECTION 3. The form, terms and provisions of the Bond Purchase Agreement are hereby approved, and approval is granted to Authority to enter into the Bond Purchase Agreement in substantially 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 prices 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 Series 2011A Bonds, in a principal amount not to exceed $1,750,000 and bearing interest at rates to be determined, but not to exceed a maximum net effective interest rate of 5.75% and the form, terms and provisions of the Series 2011A 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. The issuance and sale of the Series 2011B Bonds, in a principal amount not to exceed $15,000,000 and bearing interest at rates to be determined, but not to exceed a maximum net effective interest rate of 5.75%, and the form, terms and provisions of the Series 2011B 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 or cause to be taken all action necessary or reasonably required or desirable to finance the respective costs of the refunding of the Series 2005 Bonds and the Memorial Hall Project from the proceeds of the Bonds and for carrying out the transactions contemplated by this Resolution and the Indenture, 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 Resolution shall not be construed as reviving any bylaw, order, resolution or ordinance, or part thereof. INTRODUCED June 13, 2011 BY: Judy Weaver COUNCILPERSON Background Paper for Proposed RESOLUTION DATE: AGENDA ITEM # M-8 June 13, 2011 DEPARTMENT: Law Department Thomas J. Florczak, City Attorney TITLE A RESOLUTION APPROVING THE ISSUANCE BY THE URBAN RENEWAL AUTHORITY OF PUEBLO, COLORADO, OF THE AUTHORITY’S TAXABLE REFUNDING REVENUE BONDS, SERIES 2011A AND TAX-EXEMPT REFUNDING AND IMPROVEMENT REVENUE BONDS, SERIES 2011B; APPROVING AN INDENTURE OF TRUST, ESCROW AGREEMENT AND BOND PURCHASE AGREEMENT IN CONNECTION WITH THE ISSUANCE OF THOSE BONDS; AND APPROVING CERTAIN ACTIONS OF THE AUTHORITY HERETOFORE TAKEN AND TO BE TAKEN HEREAFTER WITH RESPECT TO THE ISSUANCE OF THE BONDS ISSUE Should City Council approve the form and terms of the Urban Renewal Authority of Pueblo Series 2011 bond Indenture and associated bond documents? RECOMMENDATION Approve the Resolution. BACKGROUND In November 2010, the voters authorized Urban Renewal Authority of Pueblo (“Authority”) to issue $10 million in bonds for the renovation of Memorial Hall, and further authorized the pledge of the “Vendors’ Fee” (3.3% of the City’s sales and use tax collection) for the repayment of the bonds. City Council adopted Ordinance No. 8336 on May 9, 2011, effecting the pledge of the Vendors’ Fee in repayment of the Bonds, but requiring in Section 3 thereof that the Indenture and other documents associated with the bond issuance be approved by Resolution of City Council. This Resolution completes the approval process by approving the form, terms and provisions of the bond Indenture and associated documents. These instruments provide for the issuance of the bonds for the Memorial Hall renovation, as well as refunding outstanding Convention Center bonds. Through this mechanism, the net proceeds available for Memorial Hall will be maximized. The Authority anticipates issuing the bonds and bond closing on or about June 23, 2011. FINANCIAL IMPACT The Resolution does not result in the incurrence of any debt by the City, nor affect the prior pledge of the Vendor’s Fee.