96-058 RESOLUTION NO. 96-58
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
AVENTURA, FLORIDA AWARDING THE $10,000,000 SHORT-TERM
BANK LOAN/LINE OF CREDIT REQUEST FOR PROPOSALS TO
BARNETT BANK, N.A. IN ACCORDANCE WITH THE ATTACHED
PROPOSAL; AUTHORIZING THE CITY MANAGER TO NEGOTIATE
SPECIFIC TERMS OF THE ASSOCIATED CONTRACTS AND
DOCUMENTS SUBJECT TO FURTHER CITY COUNCIL APPROVAL;
AUTHORIZING THE CITY MANAGER TO TAKE NECESSARY AND
EXPEDIENT ACTION TO CARRY OUT THE AIMS OF THIS
RESOLUTION; AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the City Manager of the City of Aventura, Florida, has, pursuant to
the various laws of the State of Florida and the Ordinances of the City of Aventura,
properly solicited and accordingly accepted Request For Proposals for the $10,000,000
short-term bank loan/line of credit; and
WHEREAS, sealed bids have been submitted to and received by the City
pursuant to the City's Request For Proposals; and
WHEREAS, staff and the City's Financial Advisor, Rausher Pierce Refsnes, Inc.,
has recommended that the loan/line of credit be awarded to Barnett Bank, N.A., who
has submitted the lowest responsible and responsive cost proposal; and
WHEREAS, the City Council, upon the recommendation of the City Manager, is
therefore desirous of authorizing the negotiation of specific terms of the associated
contracts and documents of the short-term bank loan/line of credit.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF AVENTURA, FLORIDA THAT:
Section 1: The City Council hereby awards the $10,000,000 Short-term Bank
Loan/Line Of Credit Request For Proposals to Barnett Bank, N.A. in accordance with
Resolution No. 96-58
Page 2
the attached proposal and subject to the negotiation and finalization of the appropriate
documents.
Section 2: The City Manager is hereby authorized to negotiate specific terms
of the associated contracts and documents subject to further City Council approval.
Section 3: The City Manager is hereby authorized and requested to take ail
necessary and expedient action to carry out the aims of this Resolution.
Section 4: This Resolution shall be effective immediately upon its adoption
and the enactment of the Ordinance authorizing the issuance of not to exceed
$10,000,000 of debt.
Rogers-
The foregoing Resolution was offered by Councilmember Liber~, who moved its
adoption. The motion was seconded by co~ci~r Perlow,and upon being put to a
vote, the vote was as follows:
Councilmember Jay R. Beskin yes
Councilmember Ken Cohen yes
Councilmember Harry Holzberg 7es
Councilmember Jeffrey M. Pedow yes
Councilmember Patricia Rogers-Libert yes
Vice Mayor Arthur Berger yes
Mayor Arthur I. Snyder absent
PASSED AND ADOPTED this 3rd day of DecemSer ,1996.
TERESA M. SMITH CMO
CITY CLERK
APPROVED AS TO LEGAL SUFFICIENCY:
CITY ATTORNEY
B;Imett Bank, N.A.
Miami. F~a 33131
In--al ~ng M~r
No~ 19, 1996
Fimm~ Director
City ~ Av~
2999 ~.~, 191 S~ - S~ 500
A~ ~o~ 33180
~: $10,000,000 ~ for ~
No~ 18, 1~6, ~ pl~ ~ ~ a~p~
v~o~ ~os ~:
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CITY OF AVENTURA
$10,000,000 REQUEST FOR PROPOSAL
Name of Financial Institution: Barnett Bank, N.A.
Address: 701 Briekell Avenue
Miami, Florida 33131
Telephone: (305) 350-7085
Contact Name: Roberto Pelaez
Title: Senior Vice President
Institutional Banking
Barnett Bank, N.A.
South Florida
701 Brickelr Avenue
Miami, Florida 33131
305/350-7085
- ,- Fax 350-7005
Roberto Pelaez
Senior Vice President
Institutional Banking Manager
November 18, 1996
Mr. Eric M. Soroka
City Manager
City of Aventura
2999 N.E. 191 Street, Suite 500
Aventura, Florida 33180
Re: $10,000,000 Request for Proposal
Dear Mr. Soroka:
Barnett Bank, N.A. is pleased to submit the following proposal in response to the above
referenced RFP.
Borrower: City of Aventura
Amount: $10,000,000
Purpose: To finance the acquisition of land for a park, a Government
Center, and a police station within the City limits.
Pricing/ 4.354% Tax-Free Fixed
Tax-Free Coupon Rate The above rate is expressly subject to this transaction being
designated a "Qualified Tax-Exempt Obligation" as defined
under Section 265 of the Internal Revenue Code. The Bank
will include appropriate gross-up provision language.
Term/Maturity: 3 years / December 30, 1999
The Bank is willing to extend this facility for an additional
year. The interest rate and terms will be negotiated at the
time the request is made.
Eric M. Soroka
City of Aventura
November 18, 1996
Page 2
Conditions: 1) Borrower to provide annual financial statements within
120 days of fiscal year end.
2) Borrower to provide copy of annual approved budget.
3) Pledge of Municipal Utility Taxes as provided by
Ordinance 96-03 of the City of Aventura, Florida, upon
the purchase in the City of electricity, water, metered gas,
bottled gas, coal, fuel oil, and telecommunications service.
4) Resolution by City to budget and appropriate principal
and interest payments as well as other expenses in the event
they are not covered by repayment sources.
5) Debt service coverage of 1 to 1 from the utility taxes.
6) The facility will be closed by outside counsel. We have
been advised that the total cost will be between $2,500
and $3,000, unless there are substantial deviations from
the terms and conditions set forth in this letter.
Repayment Terms: Interest: Semi-Annually
Principal: Annually
Attached is Amortization Schedule of payments indicating
the principal and interest portion of the debt service
requirements for the bank loan.
Our obligation is subject to final credit approval which we expect two weeks after your decision.
Also, the above mentioned credit facility will be subject to the satisfactory preparation, execution
and delivery of documentation in form and substance satisfactory to the Bank, including but not
limited to the terms set forth above. All costs incurred by the Bank in this closing will be paid
by the City of Aventura.
We appreciate the opportunity to bid on this facility and look forward to your decision.
Sincerely,
Roberto Pelaez ~
Senior Vice President
Manager, Institutional Banking
Enclosure
This is our standard groseup language. Specific wording will be subject to our outside counsel.
The interest on the Note is excludable from the gross income of the Noteholders for
federal income tax purposes and is not an item of tax preference described in Section 57 of the
Code for purposes of the federal alternative minimum tax imposed on individuals and
corporations. It is to be noted that with respect to certain corporations, such interest may be
required to be taken into account in determining adjusted net book income for purposes of
calculating the alternative minimum taxable income of such corporations. The opinions
expressed in the first sentence of this paragraph are conditioned upon continuing compliance
subsequent to the issuance of the Note by the Issuer with various covenants contained in the Note
Documents, including, without limitation, their covenants to comply with applicable
requirements of the Code necessary in order to preserve the exclusion of interest on the Note
from gross income for federal tax purposes. Failure by the Issuer to comply with these
requirements could cause the interest on the Note to be includable in gross income for federal
income tax purposes retroactive to the date of issuance of the Note. Other provisions of the Code
may give rise to collateral federal income tax consequences (which may be adverse) to particular
Noteholders. This opinion is limited to matters expressly addressed above and no opiaion is
expressed in this letter regarding other federal tax consequences that may arise due to ownership
of the Note.
City of Aventura File: Aven_Amo. wk4
Amortization Schedule S Hamish 11/15/96
Pnncipal annually; 1st payment 12/30/97 Amount: $10,000,000
Interest semiannually; 1st payment 6/30/97 Rate: 4.354000% Per year
Limit on year 1 payments = $3,840,000 0.011929% Per day; 365 day year
-' -Principal Days to next Interest Payment Payment
Funding interest accrual due amount due date
(Payment) payment this tranche
Balance
Year 1
1st funding 12J30/96 3,300,000.00 182 71,644.18
2nd funding 1/15/97 2,755,000.00 166 54,553.83
3rd funding 2/1/97 3,000,000.00 149 53,321.59
4th funding 6/1/97 945,000.00 29 3,269.08
Total funding = Balance 6/30/97 10,000,000.00
Interest through 6/30/97 182,788.67 (182,788.67 6/30/97
Interest 7/1/97 through 12/30/9T 183 218,296.44 (218,296.44 12/30/97
Principal payment 12/30/97 (3,078,914.89) (3,078,914.89 12/30/97
Balance 1 2/30/97 6,921,085.11
Total payments year 1 (3,480,000.00
Year 2
Balance 12/30/97 6,921,085.11
Interest 12J31/97 through 6~30/98 182 150,259.22 (150,259.22 6~30~98
interest 7/1/98 through 12/30/98 183 151,084.82 (151,084.82 -12/30/98
Principal 12/30/98 (3,460,542.56) (3,460,542.56 12/30/98
Balance 12/30/98 3,460,542.56
Total payments year 2 (3,761,886.60)
Year 3
Balance 12/30/98 3,460,542.56
Interest 12/31/98 through 6~30~99 182 75,129.61 (75,129.61) 6/30/99
Interest 7/31/99 through 12/30/99 183 75,542.41 (75,542.41) 12/30/99
Principal 12/30/99 (3,460,542.56) (3,460,542.56) 12/30/99
Balance 12/30/99 0.00
Total payments year 3 (3,611,214·58)
Reconciliation Principal Interest Total
Tota~ funding 10,000,000.00 10,000,000.00
Principal paid (10,000,000.00)
Total interest 853.101 18 853,101.18 6
Interest paid (853 401 18)
Payments paid ¢0,853 101 18)
000 ;~r: 0 O0
List of Financial Institutions
to Receive
RFP for
Financial Institutions with Office~ in ~e
Do~ D- T~haw F~ E. ~, 3r. L~
~sse Fed~ Uffit~ National ~nk Bank
29~ Av~ Blv& 18201 N. Bi~a~e Blv& 18999 B~ca~c Blvd-
A~FL 33180 Av~ 33160-25~ A~ 33180
(305) 931-23~ 005) 931-5~0 (305) 933-3222
(305) 935~379 005) 937-0118 F~ 00~ 933-3211 F~
~e ~ S~ ~a~ Fh~ N~da Tso~l~
B~e~ B~-Av~mra ~ Hafion~ B~ Co~ Naflon~ B~
19~ Bi~y~ Blvd. 2875 N.E. 191~ S~ 20801 Bis~a~e B~d.
Av~ 331804315 Av~ 3~lg0 Av~ 33180
(305) 899~100 005) 692-5100 (305) 651-7110
(305) 931-~985 F~ 005) 692-~ F~ (305) 933-1617
Sa~ S~ M~e Bl~g T~ S~
U~ Nafiou~ Bsak Gr~t W~te~ ~k Jeffe~on B~nk
17701 BB~e B~& 19495 Bisca~c BI~. 3560-B My~c Pointe
Av~ ~ 33180 Av~a,~ 33180
(305) 957-~6~ (305) 933~206 Av~ ~ 33180
(305) 9~7-2078 F~ (305) 933~107 F~ (30~) 933-1516
l~e ~c~c ~nd ~ H~iet Kob~
Nafio~ No.hem T~ B~k Repub~C Nafio~
2~95 B~e Blvd. 3~1 A~ Blv& 29~ A.~t~ Blvd.
(305) 935~ (305) 9M-2~0 (305) 93l~700
(~05) 931~18 F~ (30~ 931-5~8 F~ (305) 9~6-091t F~
Sa~ of~ T~r~ Sa~gs & ~
3050 A~ B~. 19~7~ B~ Blv~
Av~ 331~0 Av~FL
(305) 932~ (305)
~05) 93~67~ F~ (305) 931~148 F~
P,,AUSCHBR PIERCE REFSNES, INC.
ttochment
Financial In~Rutions with Offices Out.~de th~ ~ ~ ~ ~ ~ ~ ~
Pat Morris Trm Foley Carlos E,sohave
Citib~n~ ITu'st Union National Bank First Union National
8750 Doral Blvd- 200 $. Biscayne Blvd., 15 Fl. Bauk
IVllaml; FL 33178-2402 Miami, FL 33131 200 $. Biscayne Blvd.
(305) 599-5837 (305) 789-5034 Miami, FL 3313t
005) 599-5520 Fax (305) 7894809 Fax 005) 7894664
(305) 7894902 Fax
Marie Donowlt~ phyllis gleald Fxlward C. Haynes
1%101~1 M]~ml ]~4~C[1 O(~lnmark Bank Skylake State Ba~k
195 Federal Credit Un'on 3845-49 N.E. 163rd Strcc't 1550 NE Miami ~s
1001N. Federal Highway N. Miami Beach, FL 33160 Dr.
l~allandale, FL 33009 005) 9~0-6275 N. Miami Beach, FL
(954) 4549898 005) 949-3361 Fax 33179
(954) 454-9807 Fax (305) 945-1800
(305) 944-7107 Fax
Tony Nobos
SnnTrn$t B~nu
9600 Coiling Avenue
Miami B~agh, FL 33154
(305) 868-2680
(305) 868~2646 Fax
RAUSCHE. R PIERCE REFSNES, INC.
Attochment
R~herto Pelaez D~iel D~ny~ Tyler K~
~ B~ No~he~ T~t ~e Fj~ B~ L~ted
701 Bfic~H Argue 50 ~le ~B- 12) ~ ~e~ve
(305) ~51-7085 (3~2) 63~8~8 ~ 3~
(305) 350-7~5 F~ (312) ~ ~78 F~ ~, FL 33131
(305) 37~6
(305) 381-8338 Fax
Ms. Terry Ooodson Tom T~ele
First Union Nutional Bank S~mRank/Miami, N_A-
Goverameat Banking Corpor~ Banking Division
77 F~st Camino Real 777 Brickell Avenue
Boca Rato~ FL 33432 Miami. FL 33131
O61)338-6050 (305)579-7154
(561)338-3959 Fax (305)579-7173 Fa~x
KAUSCHER PIERCE REFSNES, INC.
Attuchment . _/
RAUSC~F.R HERC£ REFSNF. S, INC,
Percy ~ A~, Sr.
Via Facsimile- $05/406.8959
TO: Harry Kilgore
Director
Finance Support Services
FROM: Percy IL Aguila, Ir.
Financial Advisor
DATE: November 20, 1996
RE: Evaluation of Proposals for $10,000,000 Bank Loan/Line of Credit
The city received six (6) proposals in response to the RFP that was issued on
November 12, 1996 for a $10,000,000 Bank Loan/Line of Credit.
The six proposals were received from thc followia8 financial institutions:
~ Barnett Bank,
~ First Union National Bank of Florida*
~ Northern Trust Bank* *
~ Skylake State Bank
~ SunTrusl Bank, Miami, N.A.
~ United National Banks*
This proposal was received via facsimile and it is unclear whether the proposal
made the 1:00 p.m. deadline of submission of proposals.
This proposal was received after the 1:00 p.m. deadline for submission of
proposals.
Miami Cenl~r · 201 S. Biscayne Boulevard, Suite 830 · Miami, Florida 33131 · (305) 57%4400 · FAX (305) 5774838
Member Ne~ Yorlc Stock Exchange. Inc
Based on the interest rotes and fees that were submitted by each of the financial
institutions for a bank 10an that is ore-oavable anv, Jme and without Denalty, the proposals
would be ranked as follows: -
~ Fees/Closinn Costs
Barnett Bank 4.354% $ 3,000
SunTrust Bank, lVfiami, N.A. 4.58 36,000
First Union National B mdc of Florida 4.78
Skylake State Bank 4.96 82,000
United National Bank 6.00
Northern Trust NA (1) _
(1) Cannot be calculated due to lack of information regarding the imtial interest rate and the
proposed interest rote index for fumm loan draws.
The Barnett Bank proposal assumes ~ amortization of the $10 million borrowed
by the City within the 3-year term of the loan. The SunTrust Bank proposal assumes
amortization of the $10 million until the 3-year term of the loan comes due. As a result of
the different assumptions upon which each of these two proposals highest ranked were
based, we cannot determine at this time which proposal will provide the most cost
effective loan to the City under an interest-only structure. Accordingly, we are
recommending that the City request clarification from Barnett Bank as to what is the
interest rate that would be applicable if the loan is structured as an interest-only loan
through the three-year term. We are also recommending clarification fi`om Barnett Bank
due to the fact that their proposal offer the City the lowest upfront/elosing fees and
includes covenants and provisions to the loan documents that are the most beneficial to
the City.
RAUSCHER PIERCE REFSNES, INC.
Attachment
RAUSCHER PIERCE REFSNES, INC.
Via Facsimile - $05/4~6-8~39
MEMORANDUM
TO: Harry Kilgore
Director
F~nce Support Services
Percy R. Aguila,~ .
FROM: Financial Adviso~
DATE: November 21, 1996
RE: Evaluation of Proposals for $ I0,000,000 Ba. le Loon/Line of Credit
Based on thc proposals received by thc City pursuant to thc RFP for a
$10,000,000 Bank Loan/Line of Credit, we are re~)mmcndlng selection of the proposal
from ]~ltl211lL~]~ as the winning bid.
The Barnett Bank, N.A. proposal provides ~e City the lowest interest rate a~d the
lowest closing costs associated with the financing. In addition, the loan requirements and
covenants requested by the bank provide the City the most beneficial terms and
conditions as comparcA to those requested by the other financial i~rtitutions.
It is our understanding that the City's award of the bank loan is scheduled for the
City Commission meeting of December 3, 1996. In this regard, it would be appropriate
to request Barnett Banlc to proceed ~ith credit ,xnderwrigng for purposes of prow'ding the
City a firm commitment by the December 3, 1996 meeting.
Miami Center · 201 S. Bisc. ayae Boulevard, Suite 830 · Miami, Florida 33131 - (305) 577-a400 · FAX (305) 5774838
HmTy Kilgo~e
Novm mmcamem,.
Page- 2-
Back~onnd
~e propos~ we ~ recomm~d~g ~m B~e~ B~ reflecto ~ ~te~t rote of
4.~8% ~d a ~c~ ~ is b~d on mt~t~ffiy ~u~ ~c 3-ye~ te~ of ~e lo~.
~ ~on, B~eR BanV is off~g ~ C~ ~ ~t~est ~te of 4.57%
s~ct~ wi~ pr~cip~ ~o~fion of $5~,~ ~ ~ch of ye~ one ~d ~o. (S~
~closed 1~ ~t~ Nov~b~ 19, 1~6 ~m B~eR B~). B~eR B~ ~so
p~osed W ~ ~W ~ ~t~ rate of 4.354% for a
y~. B~ of humor comets ~ ~e n~ for flexibiliW
long-te~ ~c~ pl~, a ~ly-~o~ng 1o~ is not ~mm~d~ at ~is time.
~e ~[e below s,m~ how ~ B~cR B~ ~s~ compmes wi~
~opo~ sub~ by S~T~ B~ Mi~i, N.~, w~ch we co~r ~e s~ond-
r~nked propos~ s~mitt~ W ~e CiW.
Clos~g C~ lnter~
~d Up~out Fee Effe~ive
Fe~ Ye~ 1 Y~ 2 Yg~ 3 To~
B~eRB~ 3,~0 421,904 458,000 458,~0 1,3~,904 4.590%
S~Tmg B~ 36,0~ 421,904 458,000 45g,0~ 1~73,9~ 4.703%
~, for yo~ ref~ce, I ~ve set fo~ below how ~e ~ B~k propo~ comp~s
~o S~T~'s ~ ~p~ to ~fic cov~ants ~ ~n~o~ ~at would ~ve ~ ~ m~
befog ~o iss~ of a~o~
Debt Se~ee Coverage Ratio
B~eR B~n~ 1.0 to 1.0 - From PI~ U~ty R~ues
S~T~t B~ 1.4 to 1.0 -Fmm Pl~g~ U~W R~v~nu~s
B~ B~ No Rcq~cm~nt
S~Tmst B~ ~low~ if Debt S~ce Cov~age ~fio is 1.15 to 1.00
Enclosure
RAUSCHER PIERCE REFSNES, INC.
Attachment!
Barnett Bank, N.A.
8ou~h F~oTid8
Miami, F~a 33131
30~7~
In~a~ B~n~ M~r
No~ 19, 1996
M:. Harry M,
Finance Director
Ci~7 of Av~
2999 N.R. ~91 S~ - S~m 5~
Av~ ~o~ 33180
~: S10,000,000 ~e~ ~t ~
P~s~t m yo~ r~u~ ~ P~ A~'s ~e~
No~b~ 18, I~6, ~ pl~= ~d ~ ~p~
v~o~ ~os t~:
A) ~ee-y~ ~ ~Y f~ $10,000,0~: 4.~8~ ~ t~.
B) $~,0~ ~P~ ~ydo~ at ~ end of
~ due; ~ - ~ ra~: 4,5~.
~ ~ ~ ~ ~ of o~ N~= l
S~d you ne~ ~ ~= c~c~on, ple~ c~ mc ~ ~50-~08~. ' '
S~Sy,
cc: P=cy A~a