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HomeMy WebLinkAbout08695ORDINANCE NO. 8695 AN ORDINANCE APPROVING AN AMENDMENT TO A GARAGE LEASE AGREEMENT BY AND BETWEEN THE PUEBLO MAIN STREET GARAGE CORPORATION, A COLORADO NONPROFIT CORPORATION AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that: SECTION 1. The Amendment to the Garage Lease Agreement between the Pueblo Main Street Garage Corporation, a Colorado nonprofit corporation and the City of Pueblo, a Municipal Corporation, dated December 19, 2013 (the "Amendment"), a copy of which is attached hereto, having been approved as to form by the City Attorney, is hereby approved. SECTION 2. The President of the City Council is authorized to execute the Amendment in the name of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. SECTION 3. The officers and staff of the City are directed and authorized to perform any and all acts consistent with the intent of this Ordinance and attached Amendment which are necessary to effectuate the transactions described therein. SECTION 4. This Ordinance shall become effective upon final passage and approval. INTRODUCED: January 13, 2014 BY: Steve Nawrocki Councilperson PASSED AND APPROVED: January 27, 2014 Background Paper for Proposed ORDINANCE DATE: January 13, 2014AGENDA ITEM # R-1 DEPARTMENT: Law Department Daniel C. Kogovsek, City Attorney TITLE AN ORDINANCE APPROVING AN AMENDMENT TO A GARAGE LEASE AGREEMENT BY AND BETWEEN THE PUEBLO MAIN STREET GARAGE CORPORATION, A COLORADO NONPROFIT CORPORATION AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION ISSUE Should City Council approve an Ordinance amending a Garage Lease Agreement with the Pueblo Main Street Garage Corporation (“Garage Corporation”)? RECOMMENDATION Approve the Ordinance. BACKGROUND The Pueblo Urban Renewal Authority (“PURA”) recently made a final payment on a $2,788,000 promissory note (“Note B”) associated with the construction of the Main Street Garage. Another promissory note, in the initial principal amount of $6,862,000 (“Note A”) has been assigned to PURA. PURA’s bond counsel has recommended that in order not to jeopardize the tax credits received under the federal New Markets Tax Credits Program, the Garage Corporation make “interest only” payments to PURA under Note A for an additional 42 months. The City’s lease agreement with the Garage Corporation corresponds with the amount of the “interest only” payments under Note A to be paid by the Garage Corporation to PURA. It is the intent of the City and PURA that at the end of the 42 month period (July 1, 2017) the Garage Corporation will be dissolved and Note A will be extinguished and full title to the Main Street Garage will vest in the City. FINANCIAL IMPACT For 42 months beginning January 1, 2014, the City’s lease payments to the Garage Corporation will be reduced from $145,000 per year to $94,010 per year. The City is responsible for 40% of these annual lease payments and PURA is responsible for the remaining 60%. AMENDMENT TO GARAGE LEASE AGREEMENT This Amendment to a Garage Lease Agreement ( "Amendment ") dated this 19th day of December, 2013, is made by and between the Pueblo Main Street Garage Corporation, a Colorado nonprofit corporation (hereinafter referred to as "Corporation ") and the City of Pueblo, a Colorado municipal corporation (hereinafter referred to as "City "), WITNESSETH, RECITALS A. Corporation and City are parties to a Garage Lease Agreement dated December 14, 2006 (hereinafter referred to as "Lease ") pursuant to which the City occupies a portion of a parking garage commonly known as the Main Street Garage. B. The parties wish to amend the Lease as set forth herein. AGREEMENT In consideration of the foregoing Recitals and mutual covenants contained herein, Corporation and City agree as follows: 1. Exhibit D attached to the Lease, referenced in Section 6.02 of the Lease, is hereby amended to read in its entirety as follows: RENT SCHEDULE Year Rent 2014 $ 94,010 2015 94,010 2016 94,010 2017 47,005 2. Except as expressly amended by this Amendment, the terms and conditions of the Lease dated December 14, 2006 shall remain in full force and effect. 3. This Amendment shall have an effective date of December 31, 2013. IN WITNESS WHEREOF, the Corporation has executed this Amendment in its corporate name with its corporate seal hereunto affixed and attested by its duly authorized officers; and the City has caused this Amendment to be executed in its corporate name and the seal of the City affixed and attested by duly authorized officers thereof. All of the above are effective as of December 31, 2013. [SEAL] PUEBLO MAIN STREET GARAGE CORPORATION, as the Landlord By Allaj A I t� Pre.. ide Attest: By S - "retary [CITY SEAL] CITY OF PUEBLO, COLORADO, as Lessee By 02%0(- President of the City Co jel Attest: °. -- By Clerk r , RESOLUTION OF THE BOARD OF DIRECTORS OF THE PUEBLO MAIN STREET GARAGE CORPORATION APPROVING AN AMENDMENT TO THE GARAGE LEASE AGREEMENT The Board of Directors of the Pueblo Main Street Garage Corporation, a Colorado nonprofit corporation (the "Corporation ") does hereby consent to, approve and adopt the following resolution: RESOLUTION WHEREAS the Corporation and the City of Pueblo, a Colorado municipal corporation (the "City ") entered into a Garage Lease Agreement dated December 14, 2006 (the "Lease ") pursuant to which the City occupies a portion of a parking garage commonly known as the Main Street Garage; and WHEREAS, the Corporation and the City wish to amend the Lease. NOW, THEREFORE, IT IS: RESOLVED that the Board of Directors of the Corporation deems it to be in the best interest of the Corporation to enter into the Amendment to Garage Lease Agreement which is attached hereto; and FURTHER RESOLVED that the president and secretary of the Corporation are hereby authorized, empowered and directed to execute, acknowledge and/or deliver to the City the Amendment to Garage Lease Agreement which is attached hereto. CERTIFICATION I, as secretary of the Pueblo Main Street Garage Corporation, a Colorado nonprofit Corporation, do hereby certify and declare that the foregoing is a full, true and correct copy of the Resolution consented to, approved and adopted by the Board of Directors of the Corporation on the 19th day of December, 2013. IN WITNESS WHEREOF, I have hereunto set my hand as of this 19th day of December, 2013. Seer: / ry