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HomeMy WebLinkAbout07530SUBSTITUTED COPY 10/23/06 ORDINANCE NO. 7530 AN ORDINANCE OF THE CITY COUNCIL OF PUEBLO APPROVING THE ISSUANCE BY THE URBAN RENEWAL AUTHORITY OF PUEBLO, COLORADO OF THE AUTHORITY'S REVENUE BONDS (EXPANDED URBAN RENEWAL PROJECT), SERIES 2006, FOR THE PURPOSE OF PROVIDING FUNDS FOR THE CONSTRUCTION OF A PARKING GARAGE, AND PAYING CERTAIN COSTS AND EXPENSES ASSOCIATED WITH THE ISSUANCE OF THE BONDS; COMMITTING THE CITY COUNCIL TO CONSIDER FUNDING ANY DEFICIT IN THE AUTHORITY'S PAYMENT OF THE BONDS IF AND WHEN SUCH DEFICITS ARISE; APPROVING AN INDENTURE OF TRUST AND PRIVATE PLACEMENT AGREEMENT IN CONNECTION WITH THE ISSUANCE OF THE 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 City of Pueblo, in the County of Pueblo and State of Colorado (the "City"), is a municipal corporation duly organized and existing as a home rule city pursuant to Article XX of the Constitution of the State of Colorado and the home rule charter of the City (the "Charter"); and WHEREAS, the Urban Renewal Authority of Pueblo (the "Authority"), is a body corporate, and has been duly organized, established and authorized by the City to transact business and exercise its powers as an urban renewal authority under the laws of the State of Colorado; and WHEREAS, the Authority is authorized to transact business and exercise its powers as an urban renewal authority, all under and pursuant to the Colorado Urban Renewal Law, constituting Sections 31 -25 -101 et seq., Colorado Revised Statutes, as amended (the "Act'); and WHEREAS, an urban renewal plan, known as the "Downtown Pueblo Amended Urban Renewal Plan dated May 1985" (the "1985 Plan"), was duly and regularly approved by the City Council of the City; and WHEREAS, the City Council of the City duly adopted and approved the Urban Renewal Plan for the Phase One Urban Renewal Project for Downtown Pueblo (the "Phase One Plan") as a separate urban renewal plan which modifies the 1985 Plan and provides for an urban renewal project under the Act known and designated as the "Phase One Urban Renewal Project" (the "1985 Phase One Project"), which was amended on January 28, 1988 and July 22, 1991 (as amended, the "Phase One Project "); and WHEREAS, the City Council amended and expanded the Phase One Plan by the adoption of the Pueblo Expanded Urban Renewal Project pursuant to Ordinance No. 7113, adopted on March 22, 2004, minor modifications to which were approved by Ordinance No. 7186, adopted on August 23, 2004 (as modified, the "Expanded Plan" and the "Expanded Project "); and WHEREAS, pursuant to the Act, the Authority has the power and authority to issue bonds to finance its activities under the Expanded Plan; and WHEREAS, under the Expanded Plan, the Authority desires to finance the construction of a parking garage (the "Project "); and WHEREAS, the Authority, by and through its Board of Commissioners, has determined that it is in the best interest of the Authority and its constituents, including the residents of the City, to issue, in furtherance of the Plan, its Revenue Bonds (Phase Two Urban Renewal Project), Series 2006 (the "Bonds "), in an aggregate principal amount not to exceed $9,500,000 for the purpose of providing funds for the construction of the Project; and WHEREAS, the City has determined that it is in the best interests of the residents of the City to issue the Bonds, and the City therefore deems it advisable and necessary for the Authority to issue the Bonds for such purposes as heretofore described; and WHEREAS, pursuant to Article XI, Section 7 of the Colorado Constitution, and Section 31- 25 -11, Colorado Revised Statutes, the City is authorized to aid, cooperate with and contribute to the financial support of the Authority; and WHEREAS, the Expanded Plan Area is just beginning to be developed, and, therefore, there exists uncertainty as to the adequacy of the Authority's revenues which will be available for payments on the Bonds; and WHEREAS, the City has determined that because of the importance of the Project, the City will agree to consider, at any time there is a deficiency in monies available to pay the Bonds, whether the City will at that time contribute an amount equal to the deficit; and WHEREAS, there have been presented to the City Council: (a) a proposed form of the Private Placement Agreement, dated as of December 2006 (the "Private Placement Agreement "), between the Authority and Vectra Bank Colorado, and (b) a proposed form of Indenture of Trust, dated as of December _, 2006 (the "Indenture "), between the Authority and as Trustee (the "Trustee "); and WHEREAS, this Ordinance is being adopted to approve the issuance, sale and delivery of the Bonds. BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO: Section 1. Definitions. In addition to terms otherwise defined herein, the following terms shall have the following meanings, as used herein: "Authority" means the Urban Renewal Authority of Pueblo, and any successor entity. 4826- 7540 - 3265.1 2 "Series 2006 Debt Service Fund" means the fund by that name created pursuant to Section 4.02 of the Indenture. "Bonds" mean the bonds approved by Section 3 hereof entitled Urban Renewal Authority of Pueblo, Colorado, Revenue Bonds (Expanded Urban Renewal Project), Series 2006. "Business Day" means any day other than (a) a Saturday or Sunday, and (b) a day on which banking institutions in the State of Colorado are authorized or obligated by law or executive order to be closed for business. "City" means the City of Pueblo, Colorado, and any successor. "Code" means the Internal Revenue Code of 1986, as amended, and any Regulations promulgated thereunder. "Dated Date" means the original issuance date of the Bonds, as established in the Sale Certificate. "Indenture" means the Indenture of Trust, dated as of December , 2006, by and between the Authority and as Trustee. "Interest Payment Date " means the Interest Payment Date as defined in the Indenture. "Private Placement Agreement" means the Private Placement Agreement, dated as of December _, 2006, by and between the Authority and the Purchaser, pursuant to which the Authority has agreed to sell and the Purchaser has agreed to purchase the Bonds at the prices and on the terms set forth therein. "Purchaser" means Vectra Bank Colorado, a Colorado banking corporation, and any successor or assign. "Regular Record Date" means the fifteenth day of the month (whether or not a Business Day) prior to each interest payment date with respect to the Bonds. "Registered Owner" means any person or persons in whose name or names a Bond shall be registered on the registration books of the Authority maintained by the Trustee. "Sale Certificate" means the certificate executed by the Authority's Agent under the authority delegated pursuant to the Authority's Bond Resolution. "Special Record Date" shall have the meaning ascribed to such term in Section 4(e) hereof. "Supplemental Public Securities Act" means the Colorado Supplemental Public Securities Act, Title 11, Article 57, Part 2, C.R.S., as amended. Section 2. General. Except to the extent inconsistent with this Ordinance, all action heretofore taken by the Authority, the City and their respective officers directed toward 4826- 7540- 3265.1 3 accomplishing the issuance and sale of the Bonds to the Purchaser is hereby ratified, approved and confirmed. Section 3. Approval and Purpose of Bonds. For the purpose of funding the construction of the Project and paying certain costs and expenses associated with the issuance of the Bonds, the Authority will issue its Revenue Bonds (Expanded Urban Renewal Project), Series 2006 (the "Bonds ") in an aggregate principal amount not to exceed $9,500,000. The issuance and sale of the Bonds, in a principal amount not to exceed $9,500,000 and bearing interest at rates to be determined, but not to exceed a maximum net effective interest rate of 8.50 %, 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 Ordinance 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 4. Covenant Upon Deficiency in Series 2006 Debt Service Fund. (a) Whenever, one month prior to an Interest Payment Date on the Bonds, there is a deficit in the Series 2006 Debt Service Fund such that debt service payments cannot be made in full therefrom on the next succeeding Interest Payment Date or debt service requirements cannot be met, the Authority shall deliver within two (2) Business Days a certificate to the City Council (through the City Manager's office) indicating the sum necessary to meet applicable debt service payments or requirements and include a request for appropriation of such sums from the City Council. The City Council may, but shall not be required to, make the appropriations so requested. All sums appropriated by the City Council for such purposes shall be delivered to the Trustee and deposited in the Series 2006 Debt Service Fund. Nothing contained in this Ordinance shall be construed to create or constitute a debt, liability or multiple -fiscal year financial obligation of the City. (b) In the event that the City Council appropriates funds as provided in Subsection (a) hereof, any amounts actually advanced by the City to the Trustee shall be repaid by the Authority, with interest thereon at a rate to be determined by the City Council at the time of passage of the appropriate measure, on or before a date similarly determined and specified in writing to the Authority. The Authority's obligation to repay such amounts may be evidenced by a note or notes of the Authority, and shall be secured by a lien upon the revenues pledged in the Indenture, which lien shall be expressly subordinate and junior to the lien of the Bonds and any obligations having a parity claim to the same revenues as the Bonds. Unless otherwise provided by a subsequent ordinance of the City, the requirements of Section 4 of this Ordinance and the City's Approval of the Bonds, Private Placement Agreement and Indenture as herein provided shall apply only to the Bonds. Section 5. Approval of Private Placement Agreement. The form, terms and provisions of the Private Placement Agreement are hereby approved, and approval is granted to the Authority to enter into the Private Placement Agreement substantially in the form presented to the City Council at this meeting, but with such changes as shall be consistent with this 4826- 7540- 3265.1 4 Ordinance and as shall be deemed necessary or desirable by the officer executing the same, such execution to conclusively show the approval of any revisions to the form hereby approved. Section 6. Approval of Indenture of Trust. The form, terms and provisions of the Indenture are hereby approved, and approval is granted to the Authority to enter into the Indenture substantially in the form presented to the City Council at this meeting, but with such changes as shall be consistent with this Ordinance and as shall be deemed necessary or desirable by the officer executing the same, such execution to conclusively show the approval of any revisions to the form hereby approved. Section 7. Miscellaneous Documents. The President or Vice President of the City Council and the City Clerk or Deputy or Assistant City Clerk, are hereby authorized and directed to execute and deliver any and all closing documents necessary or desirable in connection with the issuance of the Bonds. Section 8. Exercise of Home Rule Power. Pursuant to Article XX of the State Constitution and the Charter, the City hereby determines and declares the issuance of the Bonds to be a local matter, and therefore all statutes of the State of Colorado which might otherwise apply in connection with the issuance of the Bonds are hereby superseded, except that the City chooses to apply the provisions of the Colorado Supplemental Public Securities Act to the Bonds, as set forth above in this Ordinance. Section 9. Further Action. The officers of the City are hereby authorized and directed to take all other action necessary or appropriate, on behalf of the City, to effectuate the provisions of this Ordinance, including the printing of the Bonds and the execution of such certificates as may reasonably be required by bond counsel. The President or Vice President of the City Council is hereby specifically authorized and directed to execute a "Tax Compliance Certificate" on behalf of the City in connection with the Bonds. Section 10. Severability. If any provision of this Ordinance shall be held or deemed to be or shall, in fact, be illegal, inoperative or unenforceable, the same shall not affect any other provision or provisions hereof or render the same invalid, inoperative or unenforceable to any extent whatever. Section 11. Governing Law. This Ordinance will be governed by and construed in accordance with the laws of the State of Colorado. Section 12. Repeals. All ordinances, or parts thereof, in conflict with this Ordinance, are hereby repealed to the extent of such conflict. After the Bonds have been issued, this Ordinance shall be and remain irrepealable until the Bonds and the interest thereon shall be fully paid, satisfied and discharged in the manner herein provided, or sufficient provision shall have been made for such payment, satisfaction and discharge. After any of the Bonds are issued, this Ordinance shall be and remain irrepealable until the Bonds and interest thereon shall be fully paid or provided for. Section 13. Records. A true copy of this Ordinance, as adopted by the City Council of the City, shall be numbered and recorded, and its adoption and publication shall be authenticated 4826- 7540- 3265.1 by the signatures of the President or Vice President of the City Council and City Clerk or Deputy or Assistant City Clerk. Section 14. No Recourse Against Officers, Employees or Agents. No recourse shall be had for the payment of the principal of or premium, if any, or interest on any of the Bonds or for any claim based thereon or upon any obligation, covenant or agreement contained in this Ordinance against any past, present or future officer, employee or agent of the City, or of any successor public corporation, as such, either directly or through the City or any successor public corporation, under any rule of law or equity, statute or constitution or by the enforcement of any assessment or penalty or otherwise, and all such liability of any such officers, employees or agents as such is hereby expressly waived and released as a condition of and consideration for the passage of this Ordinance and the issuance of the Bonds. [The remainder of this page is left blank intentionally.] 4826 -7540- 3265.1 6 INTRODUCED AND PRESENTED FOR A FIRST TIME ON OCTOBER 10, 2006, ORDERED PUBLISHED BY TITLE ONLY, PRESENTED A SECOND TIME AND FINALLY PASSED AND ADOPTED ON OCTOBER 23, 2006. ATTEST: City 9erk APPROVED AS TO FORM BY CITY ATTORNEY: City Attomey INTRODUCED: OCTOBER 10, 2006 B Randy Thurston Councilperson APPROVE Presi ent of the City Council 4826.7540.3265.1 7 Background Paper for Proposed ORDINANCE DATE: 10/10/06 &d . : 0 '7530 AGENDA ITEM # 22 DEPARTMENT: URBAN RENEWAL AUTHORITY OF PUEBLO Mike Tedesco, Assistant City Manager / Urban Renewal TITLE AN ORDINANCE OF THE CITY COUNCIL OF PUEBLO APPROVING THE ISSUANCE BY THE URBAN RENEWAL AUTHORITY OF PUEBLO, COLORADO OF THE AUTHORITY'S REVENUE BONDS (EXPANDED URBAN RENEWAL PROJECT), SERIES 2006, FOR THE PURPOSE OF PROVIDING FUNDS FOR THE CONSTRUCTION OF A PARKING GARAGE, AND PAYING CERTAIN COSTS AND EXPENSES ASSOCIATED WITH THE ISSUANCE OF THE BONDS; COMMITTING THE CITY COUNCIL TO CONSIDER FUNDING ANY DEFICIT IN THE AUTHORITY'S PAYMENT OF THE BONDS IF AND WHEN SUCH DEFICITS ARISE; APPROVING AN INDENTURE OF TRUST AND PRIVATE PLACEMENT AGREEMENT IN CONNECTION WITH THE ISSUANCE OF THE 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 issuance by the Urban Renewal Authority of Pueblo Revenue Bonds for the construction of a 732 space parking garage? RECOMMENDATION Approval of the Ordinance. BACKGROUND The Urban Renewal Authority of Pueblo is selling approximately $8.85 million in revenue bonds in an effort to construct a 732 space parking structure located directly north of the City's Fleet Maintenance Building. The City of Pueblo will utilize 300 parking spaces within the structure. By doing so, the City will contribute, on an annual basis, 40.98% of the annual debt service, or $388,000. As well, in the event there is a shortfall in TIF revenue as collected by the Urban Renewal Authority, the City will have a "moral obligation" to replenish any such shortfall to insure debt coverage is met. FINANCIAL IMPACT Upon loan stabilization in 2010, the City's minimum annual obligation will be approximately $388,000.