ORDINANCE NO. 100906
Authorizing the Director of
Finance to execute a six-month time deposit with Missouri Bank and Trust
Company in an amount not to exceed $250,000.00 for the purpose of providing
security for a line of credit up to $1,000,000.00 to the Economic Development Corporation
of Kansas City, Missouri, in support of the City’s Neighborhood Stabilization
Program; authorizing the Director of Finance the option of one six-month
renewal term; and authorizing execution of an amendment to an agreement with
the Economic Development Corporation in connection with this transaction.
WHEREAS, on July
30, 2008, the U.S. Congress approved the Housing and Economic Recovery Act of
2008 (“HERA”), to be administered by the U.S Department of Housing and Urban
Development (“HUD”) and appropriated approximately $3.92 billion of emergency
assistance for redevelopment of abandoned and foreclosed homes, of which the
City’s allocation is $7,323,734.00; and
WHEREAS,
pursuant to Ordinance No. 090297, the City of Kansas City, Missouri (the “City”)
accepted a $7,323,734.00 grant from HUD through the Neighborhood Stabilization
Program to assist the City in the acquisition and redevelopment of foreclosed
and abandoned properties; and
WHEREAS, the
City accepted the proposal and authorized execution of a contract in the amount
of $6,861,361.00 with the Economic Development Corporation of Kansas City,
Missouri (“EDC”) to provide land banking and special services to the City (the
“NSP Contract”), which contract was executed July 29, 2009; and
WHEREAS,
Committee Substitute for Ordinance No. 090847 authorized the Director of
Finance to execute a one-year time deposit with a qualified banking institution
in the amount of $250,000.00 for the purpose of providing security for a line
of credit of $1,000,000.00 to the Economic Development Corporation of Kansas
City, Missouri in support of the City’s Neighborhood Stabilization Program,
which time deposit and the pledging thereof was executed with Missouri Bank and
Trust Company of Kansas City, Missouri (the “Bank”) on October 16, 2009; and
WHEREAS, the
$250,000.00 time deposit and $1,000,000.00 line of credit at Missouri Bank and
Trust Company have matured; and
WHEREAS, EDC
believes it will be in a position in the near future where it can completely
self-fund the NSP; and
WHEREAS, without
$250,000.00 of collateral from the City, the City does not anticipate that
Missouri Bank and Trust Company will renew EDC’s $1,000,000.00 line of credit
to provide working capital for the City’s NSP until such time that federal
dollars are available to reimburse paid expenses; and
WHEREAS, Ordinance No. 050120 authorizes the Director of Finance
to allocate $500,000.00 in time deposits to qualified Kansas City, Missouri
banks under the City-Wide Deposit Program pursuant to execution of a Depository
Trust Agreement but does not extend any authority beyond investment
purposes; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF
KANSAS CITY:
Section 1. That the Director of Finance is hereby
authorized to execute, on behalf of the City, a six-month time deposit, in an
amount not to exceed $250,000.00 with Missouri Bank and Trust Company, in the
standard form on file with the Director of Finance.
Section 2. That the City’s $250,000.00 time deposit with
the Bank shall be pledged as collateral for a line of credit in an amount up to
$1,000,000.00 between the Bank and the EDC to provide working capital in
support of the City’s NSP.
Section 3. That the Director of Finance is further
authorized to execute an amendment to the NSP Contract with the EDC to modify
certain terms and conditions therein.
Section 4. That the Director of Finance is further
authorized to renew the time deposit and pledging thereof for one additional
six-month term if he determines it necessary for the health and stability of
the City’s NSP.
_____________________________________________
Approved as to
form and legality:
_________________________________
Cecilia
Abbott
Assistant City
Attorney