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Legislation #: 080613 Introduction Date: 6/12/2008
Type: Ordinance Effective Date: 6/19/2008
Sponsor: COUNCILMEMBER HERMANN
Title: Approving certain amendments in connection with The Industrial Development Authority of the City of Kansas City, Missouri Kansas City Downtown Redevelopment District revenue bonds; approving and authorizing certain documents and actions relating to the amendments; and declaring an emergency.

Legislation History
DateMinutesDescription
6/13/2008 Filed by the Clerk's office
6/12/2008 Referred to Finance and Audit Committee
6/18/2008 Advance and Do Pass, Debate
6/19/2008 Passed

View Attachments
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080613.pdf Authenticated 185K Authenticated
http://kansascity.granicus.com/ViewSearchResults.php?view_id=2&keywords=080613 Video Link 0K http://kansascity.granicus.com/ViewSearchResults.php?view_id=2&keywords=080613
Fiscal notes-Amendments to remarketing and standby bond purchase agreements v1.xls Fiscal Note 61K fiscal note
Remarketing and SBPA amendment ordinance fact sheet.xls Fact Sheet 49K Fact sheet

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ORDINANCE NO. 080613

 

Approving certain amendments in connection with The Industrial Development Authority of the City of Kansas City, Missouri Kansas City Downtown Redevelopment District revenue bonds; approving and authorizing certain documents and actions relating to the amendments; and declaring an emergency.

BE IT ORDAINED BY THE COUNCIL OF KANSAS CITY:

WHEREAS, The Industrial Development Authority of the City of Kansas City, Missouri (the "Authority") is authorized and empowered under the provisions of the Industrial Development Corporations Act, Chapter 349, Revised Statutes of Missouri, as amended (the Act), to purchase, construct, extend and improve certain projects (as defined in the Act) for the purposes set forth in the Act and to issue revenue bonds for the purpose of (i) providing funds to pay the costs of such projects and to lease or sell such projects to others upon such terms and conditions as the Authority shall deem advisable, or (ii) loaning the proceeds from the sale of such bonds to others upon such terms and conditions as the Authority shall deem advisable to provide funds to pay the costs of such projects; and

WHEREAS, at the request of the City of Kansas City, Missouri (the City), pursuant to the Indenture of Trust, dated as of March 1, 2005 (the Original Indenture) between the Authority and UMB Bank, N.A., as Trustee, as amended and supplemented by a First Supplemental Indenture of Trust, dated as of July 1, 2006 (the First Supplemental Indenture), the Authority has previously issued its $115,015,000 Variable Rate Demand Tax‑Exempt Revenue Bonds (Kansas City Downtown Redevelopment District), Series 2005A (the Series 2005A Bonds), its $64,985,000 Variable Rate Demand Tax‑Exempt Revenue Bonds (Kansas City Downtown Redevelopment District) Series 2005B (the Series 2005B Bonds and with the Series 2005A Bonds, the Series 2005 Bonds), its $69,500,000 Variable Rate Demand Tax‑Exempt Revenue Bonds (Kansas City Downtown Redevelopment District), Series 2006A (the Series 2006A Bonds) and its $45,500,000 Variable Rate Demand Tax‑Exempt Revenue Bonds (Kansas City Downtown Redevelopment District) Series 2006B (the Series 2006B Bonds and with the Series 2006A Bonds, the Series 2006 Bonds) (collectively, the Bonds) to finance certain costs associated with the Kansas City Downtown Redevelopment Project (the Project); and

WHEREAS, pursuant to the Amended and Restated Indenture of Trust dated as of June 1, 2007 and the Series 2005A Series Supplement dated June 6, 2007 (collectively, the Indenture), the Authority facilitated a restructuring of the Bonds for the purpose of converting the interest rate on the Series 2005A Bonds to a fixed rate of interest and entering a swap agreement with respect to the Series 2005B Bonds and the Series 2006A Bonds; and

WHEREAS, the Authority, the City and Depfa Bank plc (the Bank) entered into a Standby Bond Purchase Agreement dated as of March 1, 2005 (the Existing 2005 Agreement) pursuant to which the Bank provides a liquidity facility for the Series 2005 Bonds, and the Authority, the City and the Bank entered into a Standby Bond Purchase Agreement dated as of July 1, 2006 (the Existing 2006 Agreement and with the Existing 2005 Agreement, the Existing Agreements) pursuant to which the Bank provides a liquidity facility for the Series 2006 Bonds; and

WHEREAS, the City wishes to request that the Authority amend the Existing Agreements to amend certain events of default and remedies and to amend certain fees; and

WHEREAS, in connection with the requested amendment, the Authority, the City and the Bank will enter into a First Amendment to Standby Bond Purchase Agreement relating to each of the Series 2005 Bonds and the Series 2006 Bonds (collectively, the Amendments to Standby Bond Purchase Agreements), to amend certain events of default and remedies and to amend certain fees, and will also enter into a First Amendment to Remarketing Agreement relating to each of the Series 2005B Bonds, the Series 2006A Bonds and the Series 2006B Bonds (collectively, the Amendments to Remarketing Agreements) as requested by the Bank in connection with the amendments of the Existing Agreements; and

WHEREAS, an emergency exists, in that the public bond market is in flux, there has been a downgrade in the rating of Ambac Assurance Corporation, the insurer of the Bonds, and consequently the costs to the City relating to the remarketing of the Bonds under the terms of the existing Standby Bond Purchase Agreement have escalated which causes a significant and ongoing drain upon financial resources and other public property of the City; the amendment of the Standby Bond Purchase Agreements is intended to result in a reduction in such costs to the City upon the implementation of such amendments; and authorization for the expeditious execution and delivery of the Amendments to Standby Bond Purchase Agreements and Amendments to Remarketing Agreements is needed for the immediate preservation of the public property , health, safety or morals of the City; and

WHEREAS, in order to accomplish the foregoing, it is necessary and desirable that the City approve the transaction described in these resolutions and the execution and delivery of the amendments to 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. Approval of Amendment. The City hereby requests, directs and instructs the Authority to amend the Existing Agreements and other documents relating to the Bonds for the purpose of amending certain events of default and remedies and amending certain fees.

Section 2. Authorization and Approval of City Documents. The proposed documents relating to the amendment (the City 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 City Documents with such changes therein and additions thereto as the Director of Finance deems necessary or appropriate.

(a)                First Amendment to Standby Bond Purchase Agreement relating to the Series 2005 Bonds.

(b)               First Amendment to Standby Bond Purchase Agreement relating to the Series 2006 Bonds.

(c)                First Amendment to Remarketing Agreement relating to the Series 2005B Bonds.

(d)               First Amendment to Remarketing Agreement relating to the Series 2006A Bonds.

(e)                First Amendment to Remarketing Agreement relating to the Series 2006B Bonds.

Section 3. 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 4. The City declares that an emergency exists under the provisions of Section 503(a) of the Charter of Kansas City. This ordinance shall take effect in accordance with that section.

 

_____________________________________________

 

Approved as to form and legality:

 

 

________________________________

Heather A. Brown

Assistant City Attorney