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Legislation #: 120139 Introduction Date: 2/9/2012
Type: Ordinance Effective Date: none
Sponsor: None
Title: Approving the issuance by the City of Kansas City Missouri of its special obligation bonds in two series, a tax-exempt series and a taxable series, in the aggregate principal amount not to exceed $92,000,000.00; approving and authorizing certain documents and actions relating to the issuance of the Bonds.

Legislation History
DateMinutesDescription
2/8/2012 Filed by the Clerk's office
2/9/2012 Referred to Finance, Governance & Ethics Committee
2/22/2012 Advance and Do Pass as a Committee Substitute, Debate
2/23/2012 Passed as Substituted

View Attachments
FileTypeSizeDescription
2012B Final Terms Cert.pdf Other 104K SO 2012B Certificate of Final Terms
2012A Final Terms Cert.pdf Other 132K SO 2012A Certificate of Final Terms
CS120139.tiff.tiff Authenticated 427K AUTHENTICATED
SO 63rd Street Admin Approp.xlsx Other 30K Admin & Approp
SO 2012A.xlsx Fact Sheet 63K Revised SO 2012A & 2012B Fact Sheet
SO 2012A 2012B Fiscal Note.xlsx Fiscal Note 28K SO 2012A & 2012B Fiscal Note
SO 2012A.xlsx Fact Sheet 63K SO 2012A & 2012B Fact Sheet
http://kansascity.granicus.com/ViewSearchResults.php?view_id=2&keywords=120139 Video Link 0K http://kansascity.granicus.com/ViewSearchResults.php?view_id=2&keywords=120139
Fact Sheet 0K NO FACT SHEET SUBMITTED TO THE CITY CLERK'S OFFICE

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COMMITTEE SUBSTITUTE FOR ORDINANCE NO. 120139

 

Approving the issuance by the City of Kansas City Missouri of its special obligation bonds in two series, a tax-exempt series and a taxable series, in the aggregate principal amount not to exceed $92,000,000.00; approving and authorizing certain documents and actions relating to the issuance of the Bonds.

WHEREAS, the City is authorized under its charter to issue its notes, bonds or other obligations in evidence thereof; and

WHEREAS, the City proposed to issue its Special Obligation Bonds (Kansas City, Missouri, Projects), in two series, a tax-exempt series and a taxable series, to provide funds: (a) to purchase a software system for revenue collection (the “Revenue Collection System”), (b) to acquire and construct public infrastructure within the corporate limits of the City (the “Public Infrastructure Project”), (c) to reimburse the City for amounts paid to acquire an interest in property under a settlement agreement relating to the former Citadel Plaza redevelopment project located at 63rd Street and Prospect in the City, and to pay certain improvement and environmental remediation costs (the “63rd and Prospect Redevelopment Project”), (d) to refinance an obligation incurred by the City under a Promissory Note from the City to Bank of America, N.A., the proceeds of which were used to pay costs of the acquisition by the City of certain property within the East Village redevelopment project (the “East Village Project”), (e) to finance a contractual obligation with Kansas City Live, LLC (the “KC Live Developer”) pursuant to the Master Development Agreement dated as of April 7, 2004, as amended, between the City and the KC Live Developer for the construction by the KC Live Developer of residential units in the Power and Light District (the “KC Live Residential Project”), (f) to pay capitalized interest on a portion of the herein-defined Bonds and (g) to pay certain costs related to the issuance of the Bonds; and

WHEREAS, the City previously issued its $19,880,000.00 Special Obligation Refunding Bonds (Kansas City, Missouri Projects), Series 2010B (the “Series 2010B Bonds”), a portion of the proceeds of which were applied to refund the Leasehold Improvement Revenue Bonds (City of Kansas City, Missouri, Lessee) Series 1999A (the “Series 1999A Bonds”) issued by the Kansas City Municipal Assistance Corporation (“KCMAC”) to finance certain costs of the Oak Street Garage (the “Parking Garage Project”) and certain streetlight improvements, of which $2,176,200.00 principal amount of such Series 2010B Bonds attributable to the Parking Garage Project (the “Series 2010B Bonds Parking Garage Portion”) is currently outstanding, and the City wishes to refund such Series 2010B Bonds Parking Garage Portion on an advance basis; and

WHEREAS, KCMAC previously issued its $24,875,000.00 Leasehold Revenue Bonds (City of Kansas City, Missouri, Lessee) Series 2001A (the “Series 2001A KCMAC Bonds”), pursuant to the Indenture of Trust dated as of May 1, 1999 (the “Original KCMAC Indenture”) as amended by the First Supplemental Indenture of Trust dated as of May 1, 2001 (the “Supplemental KCMAC Indenture” and with the Original KCMAC Indenture, the “KCMAC Indenture”) between KCMAC and First Bank of Missouri, as trustee (the “KCMAC Trustee”), to finance additional costs of the Parking Garage Project, which Series 2001A KCMAC Bonds are currently outstanding in the aggregate principal amount of $14,510,000.00 (the “Outstanding Series 2001A KCMAC Bonds”), and the City wishes to refund all of the Outstanding Series 2001A KCMAC Bonds on a current basis; and

WHEREAS, the Planned Industrial Expansion Authority of Kansas City, Missouri (“PIEA”) previously issued The Planned Industrial Expansion Authority of Kansas City, Missouri, $15,450,000.00 Taxable Leasehold Revenue Bonds (Kemper Garage Project), Series 2001(the “Kemper Garage Bonds”), pursuant to the Indenture of Trust dated as of June 1, 2001 (the “Kemper Indenture”) between PIEA and Commerce Bank, formerly known as Commerce Bank, N.A., as trustee (the “Kemper Trustee”), which Kemper Garage Bonds are currently outstanding in the aggregate principal amount of $10,920,000.00 (the “Outstanding Kemper Garage Bonds”) and the City wishes to refund all of the Outstanding Kemper Garage Bonds on a current basis; and

WHEREAS, the City proposes to issue its bonds in two series, a tax-exempt series and a taxable series, which tax-exempt series shall be designated the Series 2012A Bonds or such other series designation as the Director of Finance shall determine (the “Series 2012A Bonds”) and shall be issued pursuant to a Trust Indenture (the “Tax-Exempt Indenture”), and which taxable series shall be designated the Series 2012B Bonds or such other series designation as the Director of Finance shall determine (the “Series 2012B Bonds”) and shall be issued pursuant to a Trust Indenture (the “Taxable Indenture”), both by and between the City and BOKF, N.A., d/b/a Bank of Kansas City, as Trustee (the “Trustee”); and

WHEREAS, in order to enhance the security for the Series 2012A Bonds and/or the Series 2012B Bonds (collectively the “Bonds”) and achieve a lower cost of borrowing, it may be desirable for the City to arrange for a municipal bond insurance policy, letter of credit or other credit enhancement facility, insuring or guaranteeing the payment of the principal of and interest on the applicable series of Bonds and/or a surety bond or debt service reserve fund policy for any debt service reserve fund, to be issued by a bond insurance company, commercial bank or other financial institution acceptable to the City; and

WHEREAS, the City has found and determined that financing and refinancing of the Projects described above will benefit the citizens of the City; and

WHEREAS, in order to accomplish the foregoing, it is necessary and desirable that the City approve the transactions described in this ordinance and the execution and delivery of the financing documents and certain other matters in connection with the transaction, as herein provided; NOW, THEREFORE,

BE IT ORDAINED BY THE COUNCIL OF KANSAS CITY:

Section 1. Authorization of Bonds; Authorization and Execution of Bond Purchase Agreements and Certificates of Final Terms. The City hereby authorizes the issuance of its Bonds, in two series, in the aggregate principal amount not to exceed $92,000,000.00, for the purpose of providing funds for the following: (a) to finance the Revenue Collection System, (b) to finance the Public Infrastructure Project, (c) to finance the 63rd and Prospect Redevelopment Project, (d) to refinance the East Village Project, (e) to refund the Outstanding Series 2010B Bonds Parking Garage Portion, (f) to refund the Outstanding 2001A KCMAC Bonds, (g) to refund the Outstanding Kemper Garage Bonds, (h) to finance the KC Live Residential Project, (i) to fund capitalized interest on the Bonds and (j) to pay certain costs of issuance of the Bonds. Each series of Bonds shall be dated the date set forth in the applicable indenture of trust and form of Bond. The tax-exempt Series 2012A Bonds shall bear interest at rates initially not to exceed a true interest cost of 4.75%. The taxable Series 2012B Bonds shall bear interest at rates initially not to exceed a true interest cost of 5.20%. The applicable series of Bonds shall have such other terms and provisions as shall be provided in the applicable indenture of trust and the bond purchase agreement approved by the Director of Finance.

The Director of Finance is authorized and directed to approve the purchase price for each series of the Bonds, the principal amounts by maturity, the interest rates, the terms of credit enhancement, if any, and the other final terms of each series of the Bonds, including applicable redemption provisions, subject to the limitations set forth in this Section, and in that connection, to execute and deliver, for each of the Bonds, the Certificate of Final Terms for and on behalf of and as the act and deed of the City, which approval will be conclusively evidenced by the Director of Finance’s execution of the Certificate of Final Terms. Upon execution, the Certificates of Final Terms will be attached to this Ordinance as Exhibit A-1 (Series 2012A Bonds) and Exhibit A-2 (Series 2012B Bonds), as applicable, and the City Clerk is hereby authorized to file each such Certificate of Final Terms with this Ordinance. The City is authorized to enter into a Bond Purchase Agreement for the Bonds in accordance with the Certificates of Final Terms. The Director of Finance is authorized to execute the Bond Purchase Agreement for and on behalf of and as the act and deed of the City.

Section 2. Limited Obligations. Each series of the Bonds and the interest thereon shall be special, limited obligations of the City payable solely out of Appropriated Moneys (as defined in the applicable indenture) and moneys in the Funds and Accounts held by the Trustee under the applicable indenture), and shall be secured by a transfer, pledge and assignment of and a grant of a security interest in the applicable Trust Estate to the Trustee and in favor of the owners of the applicable Bonds. Each series of Bonds and interest thereon shall not be deemed to constitute a debt or liability of the City within the meaning of any constitutional, statutory or charter limitation or provision, and shall not constitute a pledge of the full faith and credit of the City, but shall be payable solely from the funds provided for in the applicable indenture. The issuance of the Bonds shall not, directly, indirectly or contingently, obligate the City to levy any form of taxation therefor or to make any appropriation for their payment.

Section 3. Authorization and Approval of Financing Documents. The proposed documents relating to the financing (the “Financing Documents”) are hereby approved in substantially the forms submitted to the City Council, and the Director of Finance is authorized to execute and deliver the Financing Documents with such changes therein and additions thereto as the Director of Finance deems necessary or appropriate.

(a)                Tax-Exempt Indenture.

(b)               Taxable Indenture.

(c)                Tax Compliance Agreement between the City and the Trustee, which sets forth certain representations, facts, expectations, terms and conditions relating to the use and investment of the proceeds of the Series 2012A Bonds, to establish and maintain the exclusion of interest on the Series 2012A Bonds from gross income for federal income tax purposes, and to provide guidance for complying with the arbitrage rebate provisions of § 148(f) of the Internal Revenue Code.

(d)               Continuing Disclosure Undertaking relating to the Bonds, under which the City agrees to provide continuing disclosure of certain financial information, operating data and material events, for the benefit of the owners of such Bonds and to assist the Underwriters thereof in complying with Rule 15c2-12 of the Securities and Exchange Commission.

(e)                Bond Purchase Agreement relating to the Bonds, between the City and the Underwriters of such Bonds, under which the City agrees to sell and the Underwriters agree to purchase each series of Bonds, upon such terms and conditions thereof as set in such Bond Purchase Agreement and the Certificates of Final Terms, as described in Section 1.

The City Council further approves the execution and delivery by the City of any documents which may be required in connection with the execution and delivery by the City of the applicable Indenture and issuance of the applicable series of Bonds and of such other documents as the Director of Finance deems necessary or appropriate in connection with the transactions authorized by this Ordinance.

Section 4. Credit Enhancement. The City hereby authorizes the Director of Finance to obtain a bond insurance policy, letter of credit or other credit enhancement (“Credit Enhancement”) for some or all of the Bonds and the purchase or a surety bond or debt service reserve fund policy for any debt service reserve fund, if necessary or desired, from a Credit Provider with such credit rating that, in the opinion of the applicable Underwriters, the Financial Advisors and the Director of Finance, there will be achieved an economic benefit for the City if the Bonds are secured by such Credit Enhancement. The purchase of such Credit Enhancement and the entering into of such agreements with respect thereto as may be necessary or appropriate are hereby approved. Such credit enhancement may be such type, in such amount and provided by such entity or entities as the Director of Finance shall determine to be in the best interest of the City. The officials of the City are authorized and directed to execute all documents, agreements, instruments and certificates in connection with such credit enhancement.

Section 5. Refunding and Redemption of Outstanding Series 2010B Bonds Parking Garage Portion, Outstanding Series 2001A KCMAC Bonds and Outstanding Kemper Garage Bonds. The refunding and the redemption by the City of the Outstanding Series 2010B Bonds Parking Garage Portion is hereby approved and the Director of Finance is hereby authorized and directed to execute, enter into and deliver on behalf of the City any escrow deposit agreement, if any, and such other documents, certificates and instruments with respect thereto as the Director of Finance determines to be in the best interest of the City. The refunding by the City and the redemption by KCMAC of the Outstanding Series 2001A KCMAC Bonds is hereby approved and the Director of Finance is hereby authorized and directed to execute, enter into and deliver on behalf of the City any escrow deposit agreement, if any, and such other documents, certificates and instruments with respect thereto as the Director of Finance determines to be in the best interest of the City. The refunding by the City and the redemption by PIEA of the Outstanding Kemper Garage Bonds is hereby approved and the Director of Finance is hereby authorized and directed to execute, enter into and deliver on behalf of the City any escrow deposit agreement, if any, and such other documents, certificates and instruments with respect thereto as the Director of Finance determines to be in the best interest of the City.

Section 6. Official Statements. The City hereby delegates authority to the Director of Finance to prepare, approve and deem final any Preliminary Official Statements and any final Official Statements, with the signature of the Director of Finance thereon being conclusive evidence of the Director's approval and the City's approval thereof and to approve the final terms of each series of the Bonds, including any credit enhancement of a series of the Bonds. The City hereby consents to the use and public distribution of any Preliminary Official Statement and any final Official Statement in connection with the offering for sale of each series of the Bonds.

Section 7. Approval of Selection of Professionals.

(a)                The City approves the selection of First Southwest Company and Moody Reid Financial Advisors to act as Co-Financial Advisors in connection with the issuance of the Bonds. The City approves the selection of Kutak Rock LLP and the Hardwick Law Firm LLC to act as Co-Bond Counsel in connection with the issuance of the Bonds. The City approves the selection of King Hershey, P.C., Clayborn & Associates, LLC and Jane Hart Law Offices, LLC to act as Co-Disclosure Counsel in connection with the issuance of the Bonds.

(b)               The City approves the selection of George K. Baum & Company, Wells Fargo Bank, National Association and Valdés & Moreno, Inc. to act as Underwriters in connection with the issuance of the Bonds.

(c)                The City approves the selection of First Bank of Missouri to act as Escrow Agent in connection with the refunding of the Outstanding Series 2010B Bonds Parking Garage Portion.

Section 8. Estimation and Appropriation.

(a)                The Bond Fund 3430, 2008 Southtown Urban Life Development Bond Fund is hereby renamed Special Obligation Series 2012B Bond Fund.

(b)               The revenue in the following account of the Special Obligation Series 2012B Bond Fund is hereby estimated in the following amount:

AL-3430-120000-590000 Proceeds from Sale of Bonds $4,000,000.00


(c)                The sum of $4,000,000.00 is hereby appropriated from the Unappropriated Fund Balance of the Special Obligation Series 2012B Bond Fund to the following account:

AL-3430-648045-B 63rd and Prospect Redevelopment Project $4,000,000.00

(d)               The Director of City Planning and Development is hereby designated requisitioning authority for Account Number AL-3430-648045-B.

(e)                The Director of Finance is hereby authorized to close project account upon project completion and return the unspent portion of the appropriation to the Fund Balance from which it came.

Section 9. Further Authority. The officials of the City are further authorized and directed to execute such documents, instruments and certificates and to take such further actions on behalf of the City as shall be necessary or desirable to effect the terms and provisions of this Ordinance.

Section 10. Declaration of Emergency. This ordinance is recognized as an emergency measure within the provisions of Section 503(a)(3)(c) of the City Charter in that it appropriates money and shall take effect in accordance with that section.

_________________________________________

I hereby certify that there is a balance, otherwise unencumbered, to the credit of the appropriation to which the foregoing expenditure is to be charged, and a cash balance, otherwise unencumbered, in the treasury, to the credit of the fund from which payment is to be made, each sufficient to meet the obligation hereby incurred.

 

_______________________________

Randall J. Landes

Director of Finance

 

Approved as to form and legality:

 

 

________________________________

Sarah Baxter

Assistant City Attorney


EXHIBIT A-1
CERTIFICATE OF FINAL TERMS
SERIES 2012A BONDS

 

The undersigned Director of Finance of the City of Kansas City, Missouri (the “City”), in connection with the issuance of the City’s $_________ Special Obligation Bonds (Kansas City, Missouri Projects) Series 2012A (the “Series 2012A Bonds”), certifies pursuant to Section 1 of Ordinance No. ______ of the City (the “Ordinance”), as follows:

 

1. Original Principal Amount. The Series 2012A Bonds are issued in the original principal amount of $_________.

 

2. Maturity Schedule. The Series 2012A Bonds will mature on the dates and in the amounts and bear interest at the rates as set forth in the Trust Indenture dated as of March 1, 2012 (the “Indenture”) by and between the City and BOKF, N.A., d/b/a Bank of Kansas City, as Trustee, and as summarized on Schedule 1 to this Certificate.

 

3. Weighted Average Maturity of the Series 2012A Bonds: The weighted average maturity of the Series 2012A Bonds is ______ years, as shown on Schedule 1 to this Certificate.

 

4. True Interest Cost: The true interest cost of the Series 2012A Bonds is ______%, as shown on Schedule 1 to this Certificate.

 

5. Purchase Price. The purchase price of the Series 2012A Bonds is $______, representing $_________ principal amount, plus net original issue premium of $______, less Underwriters’ discount of $______.

 

6. Optional Redemption. The Series 2012A Bonds are subject to optional redemption pursuant to the Indenture on the dates and in the amounts as set forth therein.

 

The terms set forth in this Certificate of Final Terms are within the limitations of Section 1 of the Ordinance.

 

Delivered this ____ day of _____, 2012.

 

CITY OF KANSAS CITY, MISSOURI

 

 

 

By:________________________________

Randall J. Landes, Director of Finance


EXHIBIT A-2
CERTIFICATE OF FINAL TERMS
SERIES 2012B BONDS

 

The undersigned Director of Finance of the City of Kansas City, Missouri (the “City”), in connection with the issuance of the City’s $_________ Taxable Special Obligation Bonds (Kansas City, Missouri Projects) Series 2012B (the “Bonds”), certifies pursuant to Section 1 of Ordinance No. ______ of the City (the “Ordinance”), as follows:

 

1. Original Principal Amount. The Series 2012B Bonds are issued in the original principal amount of $_________.

 

2. Maturity Schedule. The Series 2012B Bonds will mature on the dates and in the amounts and bear interest at the rates as set forth in the Trust Indenture dated as of March 1, 2012 (the “Indenture”) by and between the City and BOKF, N.A., d/b/a Bank of Kansas City, as Trustee, and as summarized on Schedule 1 to this Certificate.

 

3. Weighted Average Maturity of the Series 2012B Bonds: The weighted average maturity of the Series 2012B Bonds is ______ years, as shown on Schedule 1 to this Certificate.

 

4. True Interest Cost: The true interest cost of the Series 2012B Bonds is ______%, as shown on Schedule 1 to this Certificate.

 

5. Purchase Price. The purchase price of the Series 2012B Bonds is $______, representing $_________ principal amount, plus net original issue premium of $______, less Underwriters’ discount of $______.

 

6. Optional Redemption. The Series 2012B Bonds are subject to optional redemption pursuant to the Indenture on the dates and in the amounts as set forth therein.

 

The terms set forth in this Certificate of Final Terms are within the limitations of Section 1 of the Ordinance.

 

Delivered this ____ day of _____, 2012.

 

CITY OF KANSAS CITY, MISSOURI

 

 

 

By:

Randall J. Landes, Director of Finance