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2011-08RESOLUTION N0.2011-08 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA AUTHORIZING THE ISSUANCE OF A PROMISSORY NOTE TO EVIDENCE A LOAN FROM BANK OF AMERICA, N.A. PURSUANT TO THE BANK'S, PROPOSAL IN A NOT TO EXCEED PRINCIPAL AMOUNT OF $6,115,000 TO REFINANCE THE COSTS OF ACQUISITION AND CONSTRUCTION OF VARIOUS CAPITAL IMPROVEMENTS AND TO PAY COSTS AND EXPENSES OF ISSUING SUCH DEBT; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A LOAN AGREEMENT INCLUDING A PROMISSORY NOTE ATTACHED THERETO; AUTHORIZING THE REPAYMENT OF THE NOTE UNDER THE LOAN AGREEMENT ONLY FROM NON-AD VALOREM FUNDS APPROPRIATED FOR SUCH PURPOSE; DELEGATING CERTAIN AUTHORITY TO THE CITY MANAGER AND CITY CLERK; AUTHORIZING THE EXECUTION AND DELIVERY OF OTHER DOCUMENTS IN CONNECTION THEREWITH; AND PROVIDING AN EFFECTIVE DATE. BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA: SECTION 1. AUTHORITY FOR THIS RESOLUTION. This Resolution is adopted pursuant to the provisions of the Act (as defined herein). SECTION 2. DEFINITIONS. When used in this Resolution, capitalized terms not otherwise defined herein shall have the meanings set forth in the Loan Agreement (as defined herein), unless the context clearly indicates a different meaning. "Act" shall mean the Florida Constitution, Chapter 166, Florida Statutes, the City's Charter, the Ordinance and other applicable provisions of law. "Bank" shall mean Bank of America, N.A., and its successors and assigns. Resolution No. 2011-08 Page 2 "Bank Proposal" shall mean the Bank's proposal dated August 18, 2010, attached hereto as Exhibit A and accepted by the City pursuant to Resolution No. 2010-50, adopted on September 22, 2010. "City" shall mean the City of Aventura, Florida. "City Clerk" shall mean the City Clerk of the City or such person's designee. "City Manager" shall mean the City Manager of the City or such person's designee. "Commission" shall mean the City Commission of the City. "Financial Advisor" shall mean Dunlap & Associates, Inc. "Loan Agreement" shall mean the Loan Agreement to be executed between the City and the Bank, the form of which is attached hereto as Exhibit B. "Mayor" shall mean the Mayor of the City or, in his or her unavailability or absence, the Vice Mayor of the City or such person's designee. "Non-Ad Valorem Funds" means all revenues of the City derived from any source whatsoever other than ad valorem taxation on real or personal property, which are legally available to pay principal of and interest on the Series 2011 Note. "Ordinance" means the Ordinance enacted by the Commission on September 22, 2010, authorizing the borrowing of money as required by Section 4.03(b) of the City Charter. "Refunded Debt" shall mean the obligations of the City pursuant to the Loan Agreement dated as of April 1, 1999 between the Florida Municipal Loan Council and the City. "Series 2011 Note" shall mean the Promissory Note to be executed by the City in favor of the Bank, the form of which is attached to the Loan Agreement as Attachment A. The words "herein," "hereby," "hereto," "hereof," and any similar terms shall refer to this Resolution. Words importing the singular number include the plural number, and vice versa. 2 Resolution No. 2011-08 Page 3 SECTION 3. FINDINGS. It is ascertained, determined and declared: (A) The Florida Municipal Loan Council (the "Council") issued its Florida Municipal Loan Council Revenue Bonds, Series 1999 and loaned a portion of the proceeds thereof to the City pursuant to a Loan Agreement, dated as of April 1, 1999, between the Council and the City (the "Refunded Debt Loan Agreement"). (B) The Refunded Debt was borrowed for the purpose of (i) purchasing real property within the City to be used for municipal purposes such as parks and recreation and the location of other City facilities, including, without limitation, a City administrative complex and police station, (ii) the acquisition, construction, equipping and installation of other municipal facilities and (iii) the repayment of a line of credit established in 1996 in order to provide temporary funding for the purposes described in (i) and (ii) herein as evidenced by a revenue bond dated December 20, 1996. (C) The City has determined that it is in its best interest to refinance the Refunded Debt in order to achieve debt service savings. (D) On July 25, 2010, the City issued its Invitation to Bid to provide the City with the necessary funds to refinance the Refunded Debt and pay costs of issuance. (E) In response to the City's Invitation to Bid, the Bank submitted its proposal to provide the City with a loan in the principal amount of not to exceed $16,500,000 for the principal purpose of refinancing the Refunded Debt. (F) Pursuant to Resolution No. 2010-47, adopted on September 7, 2010, the City ranked the Bank's Proposal as the top ranked proposal and authorized the City Manager to negotiate favorable terms and fees with the Bank. (G) As required by the City's Charter, the City enacted the Ordinance authorizing the issuance of Obligations (as defined in the Ordinance) to be issued at one or more times in an aggregate principal amount of not exceeding $16,500,000. (H) The Ordinance provides that the City shall establish the details of such Obligation pursuant to a Resolution. (I) On September 22, 2010 the City adopted Resolution No. 2010-50 (the "2010 Resolution") accepting the Bank's Proposal, authorizing the refunding of the Refunded Debt, authorizing a loan agreement, establishing the herein defined Escrow 3 Resolution No. 2011-08 Page 4 Account, authorizing the issuance of a promissory note evidencing a loan with the Bank and providing the details of such promissory note. (J) On September 23, 2010, pursuant to the 2010 Resolution, the City issued its $10,385,000 City of Aventura, Florida Promissory Note (2010) (the "Series 2010 Note) for the principal purpose of refinancing a portion of the Refunded Debt and deposited a portion of the funds from the Series 2010 Note into the Escrow Account. (K) The City has determined that is necessary, desirable and in the best interests of the City to borrow the remaining amount under the Bank's Proposal and issue its Promissory Note (the "Series 2011 Note") to evidence the Loan, in the principal amount of not to exceed $6,115,000 for the principal purpose of refinancing the remaining portion of the Refunded Debt, and to establish the details of said Series 2011 Note as provided herein. (L) The City has determined that it is in the best interest of the health, safety and welfare of the City and the inhabitants thereof that the City covenant to budget and appropriate from its Non-Ad Valorem Funds in amounts sufficient to repay the principal of and interest on the Series 2011 Note when due as provided herein and in the Loan Agreement. The amounts borrowed under the Loan Agreement shall be repaid solely from Non-Ad Valorem Funds in the manner permitted under the Ordinance and to the extent set forth in the Series 2011 Note and the Loan Agreement and the ad valorem taxing power of the City will never be necessary or authorized to pay said amounts. (M) The Series 2011 Note shall not constitute a general obligation or indebtedness of the City as a "bond" within the meaning of any provision of the Constitution of the State, but shall be and is hereby declared to be a special, limited obligation of the City, the principal of and interest on which is payable solely from the Non-Ad Valorem Funds in the manner provided herein, and the principal of and interest on the Series 2011 Note and all other payments provided for herein will be paid solely from the Non-Ad Valorem Funds, and it will never be necessary or authorized to levy taxes on any real property of or in the City to pay the principal of or interest on the Series 2011 Note or other payments provided for herein. Furthermore, neither the Series 2011 Note nor the interest thereon shall be or constitute a lien upon any other property of or in the City. (N) The Series 2011 Note is hereby designated as a "qualified tax-exempt obligation" for purposes of Section 265(b)(3) of the Internal Revenue Code of 1986, as 4 Resolution No. 2011-08 Page 5 amended (the "Code"). It is not reasonably anticipated that more than $10,000,000 of tax-exempt obligations (as defined in Section 265(b)(3) of the Code) will be issued by the City, or an entity issuing on behalf of the City whose obligations would be taken into consideration for the purposes of said Section 265(b)(3) of the Code, during calendar year 2011. SECTION 4. RESOLUTION TO CONSTITUTE CONTRACT. In consideration of the purchase and acceptance of the Series 2011 Note authorized to be issued pursuant to this Resolution and the Loan Agreement by those who shall be the Bank from time to time, this Resolution shall constitute a contract between the City and the Bank. SECTION 5. AUTHORIZING AND AWARD OF SERIES 2011 NOTE. The issuance by the City of the Series 2011 Note to secure the repayment of the Loan being provided by the Bank in accordance with the terms of the Loan Agreement, to bear interest at a rate determined in accordance with the provisions of the Bank's Proposal and not exceeding the maximum legal rate per annum, to be payable, to mature, to be subject to redemption and to have such other characteristics as are provided in the Loan Agreement; and secured by a covenant of the City to budget and appropriate from legally available Non-Ad Valorem Funds each year monies sufficient to pay the principal and interest on such Series 2011 Note as set forth in the Loan Agreement, is hereby authorized and approved. Because of the characteristics of the Series 2011 Note and prevailing market conditions, it is in the best interest of the City to negotiate with the Bank to purchase the Series 2011 Note at a private negotiated sale. Prior to the issuance of the Series 2011 Note the City shall receive from the Bank the disclosure required by Section 218.385, Florida Statutes. SECTION 6. APPROVAL OF FORM OF LOAN AGREEMENT AND SERIES 2011 NOTE. The Loan Agreement, in substantially the form attached hereto as Exhibit B, is hereby approved. The City hereby authorizes the City Manager and the City Clerk to execute and deliver on behalf of the City the Loan Agreement, with such changes, insertions and additions as the City Manager may approve, their execution thereof being evidence of such approval. In order to evidence the Loan under the Loan Agreement it is necessary to provide for the execution of the Series 2011 Note. The City hereby authorizes the City Manager and the City Clerk to execute and deliver on behalf of the City the Series 2011 Note in substantially the form attached to the Loan Agreement as Attachment A, with such changes, insertions and additions as the City Manager may approve, their execution thereof being evidence of such approval. 5 Resolution No. 2011-08 Page 6 SECTION 7. LIMITED OBLIGATION. The obligation of the City to repay the Series 2011 Note under the Loan Agreement is a limited and special obligation payable from Non-Ad Valorem Funds solely in the manner and to the extent set forth in the Loan Agreement and shall not be deemed a pledge of the faith and credit or taxing power of the City and such obligation shall not create a lien on any property whatsoever of or in the City. SECTION 8. AUTHORIZING OF REFINANCING. Pursuant to the 2010 Resolution, the Commission authorized the refinancing of the Refunded Debt and authorized the Mayor, City Manager, City Attorney, City Clerk, City staff, the Financial Advisor and the City's bond counsel to take all action necessary in connection with the refinancing of the Refunded Debt. SECTION 9. ESCROW ACCOUNT; APPLICATION OF FUNDS. Pursuant to the 2010 Resolution, the City created and established within the funds and accounts of the City a special, segregated and irrevocable escrow account designated the "City of Aventura, Florida, Florida Municipal Loan Council, Series 1999 Escrow Deposit Account" (the "Escrow Account"). Upon the issuance of the Series 2011 Note, the City shall deposit to the Escrow Account those proceeds of the Series 2011 Note which shall be used to refinance the Refunded Debt. The balance of the proceeds of the Series 2011 Note shall be used to pay costs associated with the refinancing of the Refunded Debt and costs of issuance related to the Series 2011 Note. The Escrow Account shall be held in the custody of the City separate and apart from other funds and accounts of the City. Moneys in the Escrow Account shall be used solely to pay the amounts of principal of, redemption premium, if any, and interest due and to become due on the Refunded Debt. If amounts on deposit therein shall for any reason be insufficient to make such payments the City shall timely deposit to the Escrow Account, solely from legally available funds of the City, such additional amounts as may be required to pay the Refunded Debt. On each date which shall be an interest payment date, a principal payment date or a redemption date for any of the Refunded Debt, the City shall pay the amounts due under the Refunded Debt Loan Agreement, from the moneys on deposit in the Escrow Account. Moneys deposited in the Escrow Account shall be invested pursuant to the City's investment policy. Any excess funds available upon payment of the Refunded Debt shall be applied for the payment of principal and interest on the Series 2010 Note as the same shall become due under the loan agreement between the City and the Bank dated 6 Resolution No. 2011-08 Page 7 September 23, 2010 and the Series 2011 Note as the same shall become due under the Loan Agreement. SECTION 10. FEASIBILITY STUDY. Pursuant to Section 4.10 of the City's Charter, on May 20, 2010, September 7, 2010 and September 22, 2010, the City Manager and Finance Director presented information to the City Commission regarding the issuance of debt in an amount not to exceed $16,500,000 which satisfied the feasibility study requirements. Further, on each date mentioned above at least five City Commissioners approved the issuance of debt in an amount not to exceed $16,500,000. The aggregate principal amount of the Series 2010 Note and the Series 2011 Note shall not exceed $16,500,000. SECTION 11. GENERAL AUTHORIZATION. The Mayor, the City Manager, the City Clerk, the Finance Director and other employees or agents of the City are authorized to execute and deliver such documents, instruments and contracts, and are authorized and directed to do all acts and things required by this Resolution as may be necessary to effectuate the purpose and intent of this Resolution. SECTION 12. REPEAL OF INCONSISTENT DOCUMENTS. All ordinances, resolutions or parts of each in conflict with this Resolution are superseded and repealed to the extent of such conflict. SECTION 13. EFFECTIVE DATE. This Resolution shall take effect immediately upon its adoption. The foregoing Resolution was offered by Commissioner Joel who moved its adoption. The motion was seconded by Commissioner Holzberg and upon being put to a vote, the vote was as follows: Commissioner Zev Auerbach absent Commissioner Teri Holzberg yes Commissioner Billy Joel yes Commissioner Michael Stern yes Commissioner Luz Urbaez Weinberg yes Vice Mayor Bob Diamond absent Mayor Susan Gottlieb yes 7 Resolution No. 2011-08 Page 8 PASSED AND ADOPTED this 20th day of January, 2011. SAN GOT IEB, MAYOR A T SA M. SOR;pI~A, I1VIMC C Y CLERK ~~ APPROVED AS TO FORM AND LEGAL SUFFICIENCY: ~ CITY ATTORNEY 8 Resolution No. 2011-08 Page 9 EXHIBIT A BANK PROPOSAL Resolution No. 2011-08 Page 10 EXHIBIT B FORM OF LOAN AGREEMENT