ORDINANCE NO. 100758
Authorizing the execution of
Promissory Notes between the City and J.E. Dunn Construction Group Inc. in the
aggregate principal amount of $10,670,754, such Promissory Notes to be of such
number, in such principal amounts and bearing such interest rates as designated
by the Director of Finance; estimating and appropriating sale proceeds in the
amount of $1,200,000.00 from the sale of property to Swope Community Builders
or an affiliate; estimating debt service and other payments in the amount of
$971,339.00; and recognizing an emergency.
WHEREAS, Second Committee Substitute for Ordinance No.
060943 authorized the execution of the Funding and Acquisition Agreement (the
“Agreement”) between the City, the Tax Increment Financing Commission of Kansas
City, Missouri (“TIF Commission”), and J.E. Dunn Construction Group, Inc.
(“J.E. Dunn”); and
WHEREAS, Ordinance No. 071287 authorized the execution
of the first amendment to the Agreement; and
WHEREAS, in connection with the Agreement, on December
4, 2009, the City entered into an annual appropriation promissory note in the
principal amount of $10,670,754.00 with J.E. Dunn (the “Original Note”) with
twenty-one (21) semi-annual payments beginning June 1, 2010, relating to the
East Village TIF Project; and
WHEREAS, the City has paid $213,416.00 to J.E. Dunn to
satisfy the June 1, 2010 interest payment obligation; and
WHEREAS, Ordinance No. 100480 authorized the
termination of the Original Note, and the entering of two promissory notes
aggregating $10,670,754.00 in replacement therefore, upon such terms and
conditions as described in said Ordinance; and
WHEREAS, the City has been advised by Swope Community
Builders (“Swope”) that it, its affiliate East Village LLC and/or other
affiliate of Swope, expects to complete the purchase of a parcel of land in the
Redevelopment Area covered by the East Village TIF Plan within the next several
months, which expected purchase necessitates the entering of one or more
additional promissory notes and/or the modification of the terms and conditions
of the replacement promissory notes authorized by Ordinance No. 100480;
provided that the aggregate principal amount of replacement promissory notes is
unchanged; NOW,
THEREFORE,
BE
IT ORDAINED BY THE COUNCIL OF KANSAS CITY:
Section 1. That
the Director of Finance is authorized to enter into more than one or more annual
appropriation promissory notes with J.E. Dunn aggregating the principal amount
of $10,670,754.00 in replacement for the Original Note, including both
tax-exempt and taxable notes, which tax-exempt notes shall have an interest
rate not to exceed 4.50% and which taxable notes shall have an interest rate
not to exceed 10.00%. The City hereby delegates authority to the Director of
Finance to approve the final number of promissory notes and the final terms,
principal amounts and interest rates of the promissory notes. The current
expectations of the City are that there shall be three promissory notes with the
following terms: (a) a 501(c)(3) tax-exempt interest note in the amount of
$5,438,000 between the City and J.E. Dunn for a ten year term at an interest
rate of 4.00%, (b) a taxable interest note in the amount of $1,200,000 between
the City and J.E. Dunn for a ten year term at an interest rate of 4.00%, and
(c) a taxable interest note in the amount of $4,032,754 for a ten year term at
an interest rate of 5.50% between the City and J.E. Dunn, however, the number
of promissory notes and the terms and conditions thereof are subject in all
respects to the final approval of the Director of Finance, subject to the
limitations set forth in this Section. In the event that the final promissory
notes have different terms than the expected terms described in this Section,
the Director of Finance shall file a Certificate of Final Terms with the City
Clerk to be attached to this Ordinance.
Section
2. That the revenue in the following account in the East Village TIF Fund
is hereby estimated in the following amount:
11-5301-485060 Sale
of Land Proceeds $1,200,000.00
Section 3. That the sum of $946,339.00
is hereby appropriated
from the Unappropriated Fund Balance of the East Village TIF Fund to the
following account:
11-5301-129600-G Debt
Service $ 946,339.00
Section 4. That the sum of
$25,000.00 is hereby appropriated from the Unappropriated Fund Balance of the
East Village TIF Fund to the following account:
11-5301-129620 Note
Expense $ 25,000.00
Section
5. That the Director of Finance is hereby designated as the requisitioning
authority for Account Nos. 11-5301-129600 and 11-5301-129620.
Section 6. That
the Director of Finance is hereby authorized to close project accounts upon
project completion and return the unspent portion of the appropriation to the
Fund Balance from which it came.
Section
7. That 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:
______________________________
Heather
A. Brown
Assistant City Attorney