HomeMy WebLinkAbout07160ORDINANCE NO. 7160
AN ORDINANCE 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 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 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 2004 State Ceiling for the issuance of a specified principal amount of
Private Activity Bonds prior to September 15, 2004 (the "2004 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 2004 Allocation; and
WHEREAS, the City has determined that the 2004 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 $4,153,840 of
its 2004 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 ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The assignment to the Authority of $4,153,840 of the City's 2004 Allocation be and hereby
is approved.
SECTION 2.
The form and substance of the Assignment of Allocation be and hereby is approved:
provided, however, that the President of the City Council be and hereby is authorized to make such
technical variations, addition or deletions in or to such Assignment of Allocation as he shall deem
necessary or appropriate and not inconsistent with the approval thereof by this ordinance.
SECTION 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 ordinance.
SECTION 4.
If any section, paragraph, clause, or provision of this ordinance 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 ordinance.
SECTION 5.
This ordinance shall be in full force and effect upon its passage and approval.
INTRODUCED June 14, 2004
BY Michael Occhiato
Councilperson
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ID ED
Background Paper for Proposed
ORDINANCE
AGENDA ITEM #Z-
DATE: June 14, 2004
DEPARTMENT: HOUSING AND CITIZEN SERVICES /TONY BERUMEN
TITLE
AN ORDINANCE 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.
ISSUE
This Ordinance will allow the City of Pueblo to assign to the Colorado Housing and
Finance Authority (CHFA) $4,153,840, awarded to the City pursuant to the Colorado
Private Activity Bond Ceiling Allocation Act. These funds will be used to originate
mortgages for first -time homebuyers within the City of Pueblo.
RECOMMENDATION
Approve
BACKGROUND
This Ordinance continues the practice of assigning to CHFA the City's PAB allocation
for the use in single - family or multi - family bond issues. In 2003, the City assigned to
CHFA $3.8 million of its allocation for single - family MRBs. CHFA issued $11.9 million
in loans in the City. One hundred thirty -four (134) families were assisted. The average
loan size was $88,863.
The Authority acts as issuer and administrator of the bonds. The City may with the
consent of CHFA deviate from CHFA's established income and purchase price limits.
The allocation is to be used within the Pueblo county limits, however, if the allocation is
not used locally within a two -year period, then the balance becomes available for
statewide use. In past years CHFA has issued more than the City's allocation within the
City.
FINANCIAL IMPACT
By assigning the allocation to CHFA, the City provides additional mortgage funding to
this community without incurring costs.
ASSIGNMENT OF ALLOCATION
This Assignment of Allocation (the "Assignment "), dated this 14th day of June
2004, is between the City of Pueblo, A Municipal Corporation (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's 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 2004 State Ceiling for the issuance of a
specified principal amount of Private Activity Bonds prior to September 15, (the "
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 Allocation; and
WHEREAS, the Assignor has determined that the 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 2004
Allocation; and
WHEREAS, the City Council of the Assignor has determined to assign to the
Assignee $4,153,840 of its 2004 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 $4,153,840 of its 2004
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
$4,153,840 of Assignor's 2004 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 $4,153,840 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 PUEBLO, COLORADO
[SEAL]
ATTEST: By:
President o,�i e City Council
By: �/
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r°,�'.,�';.•�,Q�Rgy ® _ COLORADO HOUSING FINANCE AUTHORITY
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