COMMITTEE SUBSTITUTE FOR ORDINANCE NO. 080297

Approving the issuance by the City of Kansas City Missouri of its special obligation bonds in one or more series, in the aggregate principal amount not to exceed $30,000,000.00 for the East Village Project; 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 wishes to issue its special obligation bonds to provide funds to pay the costs of certain public improvements described in the East Village Tax Increment Financing Plan (the East Village Project); and

WHEREAS, the City proposes to issue, pursuant to an Indenture of Trust (the Indenture) by and between the City and Wells Fargo Bank, as trustee (the Trustee), its Series 2008B Bonds in the aggregate principal amount not to exceed $30,000,000.00, to provide funds to finance and refinance the East Village Project, to fund a debt service reserve fund or purchase a debt service surety bond for the Series 2008B Bonds, to pay the bond insurance premium and surety bond premium for the Series 2008B Bonds, and to fund certain costs of issuance of the Series 2008B Bonds; and

WHEREAS, in connection with the issuance of the Series 2008B Bonds to finance the East Village Project, the City and the Tax Increment Financing Commission of Kansas City, Missouri (the Commission) will enter into a Cooperative Agreement dated as of the date set forth therein (the Cooperative Agreement) pursuant to which the City and the Commission will provide for the use of certain TIF Revenues (as defined therein) for the payment of the costs of the East Village Project and the allocable portion of debt service on the Series 2008B Bonds; and

WHEREAS, in order to enhance the security for the Series 2008B Bonds (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 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 desires to indicate its expectation and intent to reimburse all or a portion of the expenditures with the proceeds of the Bonds; and

WHEREAS, the City has found and determined that financing the East Village Project 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 transaction 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. The City hereby authorizes the issuance of its Bonds, in more than one series, in the aggregate principal amount not to exceed $30,000,000, for the purpose of providing funds to finance the East Village Project, to fund a debt service reserve fund or purchase a debt service surety bond for each series of Bonds, to pay the bond insurance premium and surety premium for each series of Bonds, and to fund certain costs of issuance of the Bonds. Each series of Bonds shall be dated the date set forth therein and shall bear interest at rates not to exceed 6.00% per annum, and the Bonds shall have such other terms and provisions as shall be provided in the Indenture and bond purchase agreement approved by the Acting Director of Finance.

Section 2. Limited Obligations. Each series of the Bonds and the interest thereon shall be special, limited obligations of the City payable (except to the extent paid out of Bond proceeds or the income from the temporary investment thereof and under certain circumstances from insurance proceeds and condemnation awards) solely out of Appropriated Moneys (as defined in the Indenture) and moneys in the Funds and Accounts held by the Trustee under the 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 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 Acting Director of Finance is authorized to execute and deliver the Financing Documents with such changes therein and additions thereto as the Acting Director of Finance deems necessary or appropriate.

(a) Trust Indenture between the City and the Trustee relating to the Series 2008B Bonds.

(b) Cooperative Agreement between the City and the Commission relating to the East Village Project.

(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 2008B Bonds, to establish and maintain the exclusion of interest on the Series 2008B 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 Agreement, 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 the Bonds and to assist the Underwriters in complying with Rule 15c2-12 of the Securities and Exchange Commission.

(e) Bond Purchase Agreement between the City and the Underwriters of the Bonds, under which the City agrees to sell and the Underwriters agree to purchase the Bonds, upon such terms and conditions thereof as set in the Bond Purchase Agreement.

Section 4. Credit Enhancement. The City hereby authorizes the Acting 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 Underwriters, the Financial Advisors and the Acting Director of Finance, will achieve 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 Acting 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. Intent to Reimburse Expenditures. The City reasonably expects to reimburse all or a portion of the expenditures relating to the East Village Project with proceeds of the Series 2008B Bonds.

Section 6. Official Statement. The City hereby delegates authority to the Acting Director of Finance to prepare, approve and deem final any Preliminary Official Statements and any final Official Statements, with the signature of the Acting 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 the Bonds, including any credit enhancement 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 the Bonds.

Section 7. Approval of Section of Professionals. The City approves the selection of First Southwest Company and Valdes & Moreno to act as Co-Financial Advisors in connection with the issuance of the Bonds. The City approves the selection of the Hardwick Law Firm LLC and Angela Habeebullah, Esq. to act as Co-Bond Counsel in connection with the issuance of the Bonds. The City approves the selection of Stern Brothers & Co., Backstrom, McCarley, Berry & Co. LLC and UMB Bank, N.A. to act as Underwriters in connection with the issuance of the Bonds.

Section 8. 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.

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Approved as to form and legality:

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Heather A. Brown

Assistant City Attorney