HomeMy WebLinkAbout2004 Ordinance No. 062•
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ORDINANCE NO . _ML:::
SER IES OF 2004
BY AU TI-I ORITY
COUNC IL BIL L NO . 59
INTRODUCE D BY COU , CIL
MEM BER WOLOSYN
AN ORDI NANCE AUTHORIZ ING THE ISSUA NCE AND SALE OF AN AMOUNT NO T TO
EXCEED SS ,355 ,000 VA RIABLE RATE DEMA ND MULTIFAMILY HOUSI NG REVENUE
REFUNDING BONDS (MAR.KS EAST APARTMENTS) SER IES 2004 OF THE CITY OF
ENG LEWOO D, CO LOR.ADO FOR THE PURPO SE OF FI NANC ING A PORTION OF THE
CO ST OF RE FU 'DI NG TH E CITY OF ENGLEWOOD , CO LORADO MULT IFAMILY
HOUSING REVENUE BONDS (THE MARKS APARTMENTS) 1985 SERIES fl ;
APPROV ING AND AUTHOR IZII\G EXECUTION OF A TRUST INDENTURE , A
FINANCI NG AGREEM E, T, PURCHASE AGREEMENT, I NTER CREDITOR
AGREEMENT , AND AN AMENDED AND RESTATED LAND USE RESTRI CTION
AGREEMENT WITH RESPECT TO THE BONDS AND THE MULTI FA MILY HOUSING
PROJECT BEING REFINANCED WITH THE PROCEEDS OF THE BONDS ; MAKING
FINDINGS AND DETER.Ml ATIONS \\'ITH RESPECT TO THE PROJECT AND THE
BONDS; AU THORI ZING TH E EXECUTION AND DELIVERY OF RELATED
DOCUMENTS; AND REPEALING ALL ACTION HERETOFORE TAKEN IN CON FLI CT
HEREWITH .
WHEREAS , the City of Eng lew ood, Co lorado (the "City"') is a dul y organi ze d and existing home
rule municipa lity of th e Stoic of Co lorado (th e "State"), cre ated and operating pursuant to Ani clc XX of
the Co lorado Co nst itution and the home rule chan er of the City (the "Chaner"); and
WHEREAS . th e Co un ty and Municip ality De velopment Re ve nu e Bond Ac t. const itutin g An ic lc
J of Title 29, Co lorado Revi sed Statute s, as amended (the "Act"). au th orizes citie s an d co untie s in th e
State to fin ance or refinance one or mo re proje cts, includin g an y land . buildin gs or oth er improvement s.
and all real and personal prop ertie s, whe ther or not in ex istence , wh ich shall bi.: suitabl e for re sidentia l
faci li ties for low~ an d middlc•incomc fam ili es or persons and intended for use as the sok place of
resid ence by th e owners or in1 cndcd occ upa nt s to the end th at more adequate resid ential housin g facilitie s
for low• and middlc •in co me fami lie s or perso ns may be provide d, whi ch promote the pub lic hea lth ,
welfare . sa fet y. convenien ce and prosperi 1y; and
WH EREAS, the City is further au th or ize d by the Act to iss ue it s reve nue bonds fo r the purpo ses
of defrn yin g the cos ts of fina nc ing or refinancing any such project , including all in cid ent al expenses
in curred in iss uing such bonds, and to secu re th e pa yment of suc h bonds as provided in the Act ; and
WII EREAS. the Ci ty has previ ously made a loa n or the proceeds of its Variable Rat e Dema nd
Multifamil y I-l ousing Re venue Bond s (The Ma rks Apa rt ment s) 19 85 Se ri es B (t he "Ori gi nal Bonds"} in
• the origina l agg re ga te prin cipal amount of S 18, I 00 ,000 pursuan l to th e lams of an In de nture of Tru st
11 b iii
dat e<l as of Dece mb er I , 1985 bet wee n the Cit y and Me ll on Bank , N.A .. as tru stee (the "O ri gina l
Indentur e"), 10 HG Ve nture II ("J-I G Ve nture"). a Texas lim ited pa rtn ershi p, to pro vide finan cin g fo r a
mu lt i-fami ly re111:.t l hous ing deve lopm ent kn o\\'n as the Mark s Ap:in melll s (the "Proje ct") loc ated within
the bo undarie s o f th e C it y. fo r oc cupanc y pa rti:1ll y (as lea st 20%) by indi vidual s of low or modera tl!
in co me within the meanin g of and for the peri od required by Sec tion I 03(b) of th i:! Internal Revenue Code
of 1954 , as amend ed , all for thl! pub li c purp ose of prov idin g more adequate res id entia l housing fa cilitie s
fo r low-and middle -in co me familie s and perso ns: and
WHEREAS , the Original Bond s were remarke ted as fix ed int c rc~"t rate bond s effective Decemb er
15. 1993. designated as the Cit y of Eng lewood, Co lorado Multifamily Housing Re venue Bond s (The
Marks Apartments) 1985 Se ri es B (the "P rior Bond s"), in the aggr egate princip al amou nt of S 11 ,000 ,000 ;
and
WHEREAS , the pre sent ow ner of the Project is Wellsford Marks B Corp., a Colorado corporation
("We ll sford""), which corporatio n is wholly ow ned by Equit y Re sidential , a publicl y traded real estate
in vestment trust (""EQR "); and
WHEREAS , EQR expects to dissolve Well sfo rd and tran sfer owners hip of th e Project to anot her
EQR con troll ed entit y to be known as EQR Marks B, L.L.C ., a Delawa re limit ed li ab ilit y company (the
"Owner"'), prior to the executio n of th e document s further described herein ; and
WHEREAS , representative s of EQR and Well sford have requested that the Cit y iss ue its variab le •
rate demand multifamily hou sing re venue refunding bonds pursuanL to tem1s of th e Act to refund th e Prior
Bonds (t he '"Refu nding Proj ec t'"); and
WHEREAS. the City ha s conside red the reque st of EQ R and \Vcllsford and has co nclud ed that
th e Refundin g Proj ect w,11 ass ure the co nt inuin g pro vision of low-and middle-inc ome rcsiden tia! ren1al
fac ilitie s, promoting the public hea llh , we lfare , safe ty , conve ni ence and prosp erit y, and that the City
should issue it s vari.ible rate demand multifamily housing re ve nu e refundi ng bond s under the Act to
fin ance a porti on of the cost of the Refunding Project, subject to th e con diti ons se t forth herein ; and
WHER EAS, the Cit y will issue, se ll .ind de liver its Cit y of Eng lewood, Co lorado Variable Rate
Demand Multifamil y Housi ng Re ve nue Refun ding Bo nd s (Marks East Apartments) Series 2004 (the
"Bo nd s"), in an agg re ga te prin cipa l amount not to exceed $8,355,000, purs uant to th e term s of a Tru st
Ind enture dated as of Decemb er I, 20 04 (the ''In denture ") between th e City and Thi.! Bank of New York,
as trn st l'C (th e 'Trustee") to pay a porti on of th e cost of the Refundin g Project; and
WI IE REA S, th e Owner will ente r in to a Financing Agreement. dated as of De cember I, 2004 llh c
"Finan cing Agreem ent'') am ong th e Cit y, th e Ow ner and the Truste e pur suant to which the proceeds of
th e Bonds will be loan ed to th e Ow ner (th e "Bond Mort gage Loan"): and •
WHEREAS , th e Owner wi ll execute a Mu lt ifam il y No te (th e "ll ond Mortga ge Nole") evidenci ng
it s obli gati on 10 repay th e Bo nd Mortgage Loa n to be deli vered upon the ord er of the Ci ty pursuant to 1he
Fi nanc in g Ag ree ment to th e Tru stee : and
WHER EAS , to secure th e Owne r's obli ga ti ons unde r the Bond Mortgage a te, the Ow ner will
execute and delive r to the Tru stee on the date th e Bonds arc deli ve red a Multifami ly Dee d of Tru st.
Ass ignment of Rent s and Securit y Agreem ent (includin g Fixture Fili ng) with re spect to th e Project : and
WHEREAS . the Owner wi ll cause to be delivered to the Tru stee on the date of initial iss uance of
th e Bo nd s a direct pa y Credit Enhan ce men t Agreement da ted as of Dece mber I , 20 04 (t he "Credit
Enh ance ment Ag re eme nt "} betwee n the Federa l Home Loa n Mortgage Co rp orat ion ("Fredd ie Mac .. ) and
the Tru stee whic h will provide fo r (i) draws in an am ount equ al to ce rta in ··Guara nt eed Payme nt s" wit h
re spect to th e Bond Mort gage Loa n and (ii) liqui dity draws by the Trustee to th e exte nt rcmarkcting
proceeds arc in sufficient to pay th e purcha se pri ce of Bond s while the Bond s bea r int~res t at a va riable
rate ; and
WHERE AS , to evidence th e Owner's reimbursem ent obli ga tion s to Freddie Mac for draws made
under th e Credit Enha nc emen t Agreement , the Owner an d Freddie Mac wi ll enter into a Reimbursement
and Security Agree ment da ted as of December I, 2004 (the "Reimbursement Agreement"); and
WI-IER EA S, to sec ure the Own er's ob lig a1ions under th e Reimbursement Agreemen t, the Owner
• will exec ut e an d deliver to the Tru stee on the date th e Bonds are delivered a Multifamily Dee d of Trust,
Assignment of Rent s and Security Agreement (inc lud in g Fixture Filing) (th e "Reimbursement
Mort gage") with res pect to th e Proj ec t; and
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WHERE AS , the Ow ner's ob li gations un de r the Reimburse ment Ag reemen t and the
Reimbursemen t Mortgage will be cross co ll atera li zed with othe r multi fam il y hou sin g proj ec ts owned by
EQR or its subsi di arie s; and
WH EREAS. th e City has bee n reque sted to enter int o an lntcrcrcdi tor Agreement (th e
"lnt crcredito r Ag ree ment ") in connec ti on wi th Freddie Mac·s provis ion of credit enh ance ment; and
WHEREAS , th e City is authori ze d by the Supp lement al Publi c Secu rities Act , Article 57 or Title
11 of Co lorado Revised Statutes , as ame nded (the "Publ ic Securities Act "), to de le ga te to any of it s
member s, chi ef ex ecutive officer, or chi ef fi nancia l office r the autho ri1 y to sign a con trac t fo r the purchase
of secur it ies or to accep t a binding bid for sec urities and , in addition, may delegate the fo ll owi ng
determinations to such member or officer without any requi remen t th at th e issui ng authority ap prove suc h
dcte nnin ati ons: (a) th e rat e of int erest on sec uriti es ; (b) the co nditi on s on whic h and th e price s at which
th e ap pli cab le securities may be redeemed before maturit y; (c) the ex isten ce and amoun t of any
capitalized interest or re se rve fund s; (d) th e pri ce at whi ch th e sec uritie s will be so ld ; (c) the princip al
amounl and denomina ti ons of the secur itie s; (() the amoun t of principal matu rin g in ;my particular yc:ir;
and (g) the date s on whic h principa l and interest slrnll be puid ; and
WHEREAS . lhe City he reby determines 1ha1 it is in the Ci1y·s best intere st 10 de legate to il s
Director of Fina nce and Administrative Services ("Chief Financia l Officer") the powers enumerat ed in
th e Public Securi ties Act as more s pec ificall y provided in this Ordinan ce; and
WHEREAS , th ere have bee n pn::sc nt ed to the Ci ty Counci l at thi s meetin g the fo ll ow in g
doc ument s: (u) the proposed fo rm of th e Financing Agreement, (b) the propo se d fo m1 of the Ind enture, (c)
the propo se d fonn of the lnt ercrcd itor Agreement , (d) the proposed form of th e Amended and Restated
Land Use Restrictio n Ag reeme nt da ted as of Dece mber I 1 2004 (th e "Regul atory Agreemen t"), by and
among th e Cit y, the Ow ner and the Tru stee and (c) the propo se d form of Purchase Agreeme nt (th e
"Purc hase Agreement'') among the City, th e Owner and Merr ill Lynch , Pi erce , Fenner & Smi th
In co rpora ted (the "U nderwriter").
BE IT ORDAINED BY THE CITY COUNC IL OF THE CITY OF ENGLEWOO D,
COLORADO:
Section I. Le ga l Authorizu li on . The City is a duly orga ni zed and existing home rule
municipality of the State, created and opera tin g pu rsuant to Article XX of the Co lorado Co nstituti on an d
th e Cit y's Cha rter and is auth ori ze d under the Act to issue an d se ll it s multifamily hous ing reve nue bonds
in the fo rm of one or more deb t in stmm cnt s, suc h as the Bonds , fo r the purpose, in the manner and up on
the terms and cond iti ons set forth in the Act, in this Ordinance , and in th e In denture.
Section 2. Findings . The City Cou ncil hos heretofore determined, and does hereby
detem1ine. based upo n th e representations of th e Owner, as fo ll ows:
(a) The Project is an eli gib le "project," as defined in the Act.
(b) The issuance of the Bo nds wi ll e.''fec tuat e th e public purp oses of the Ci ty and
carry out th e purposes of the Act by, among other things , providi ng residential faci lit ie ; fo r low-an d
mid dle-i ncome persons in the City .
(c) The Bonds arc special, limited ob liga ti ons of the Cit y payable so lely out of the
income, re ve nu es and rece ipt s s pecifi ca ll y pl edge d pur sua nt 10 the Ind entu re. The Bonds, the premium ,
,i' any. nnd the intere st thereo n shall ne ve r co nstitu te the debt or indebtedness or the Cit y wi t,in the
menr,ing of any pro vis ion or lim ita ti on of thr.: State Co nstitution , Sta te sta tutes or th e Chart er, anu shall
no t constitute nor give ri se to a pecu niary liabil ity or th e City 0 1 a charge agains t its gc nr.:ra l credit or
taxing pow er and sha ll not consti tut e a "mu lt ip le fisca l yea r direct or indire ct debt or ot her finan cia l
obliga ti on" of th e Cit y und er 1\rticlc X, Section 20 of the Colorado Co nstitution. Ne ith er the State or
Co lorado nor any politi ca l subdivision th ereof shall be ob li ga ted to p:1y the prin cip al of. premium , if any,
or int ere st on the Bonds or ot her cos1 s incident thereto . The Bonds do not cons titute a de bt, loan. credit or
pled ge of th e fa ith :md cred it or tax ing powe r of th e Stale , th i.: City or any politi c;il subdivi sion th ereo f.
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• Sec tion 3. Aulhorization or ls s um1ce or Bond s. To lkrrn y th e cost of th e Refunding
Projccl. th c:rc is hereb y nuth ori zcd and crea ted a se ri l'S of va riab le ra te revenu e bo nd s designat ed "C it y or
Eng le wood. Color:i<l o. Variub lc Rate Dcmn n<l Mult ifomil y !l ousin g Re venu e Refundin g Bond s (Marks
En st Ap:i rt ment s) Se rit:s 2004" in an agg rega te principal amount 110 1 10 exceed S8.355 .00 0. Subject 10 th e
detcnnina1i on of 1he Chi er Fin an ci:I ()ffice r, th e issuance of th e Bonds shall be in such princ ipa l amounts ,
bearing such dat es and provisions fo r dctcrmin a11o n of va ri ab le int ere st rate s and suc h Bo nd s shall mature
as se t fort h in th e lnderllur c. Th e Bond s shall be payable. shall be subject to redempti on or pu rchase in
li eu of redemp ti on and lender prior to maturit y and shall be in sub stantiall y th e form as prov id ed in the
Ind enture. Furth erm ore , the Bonds shall be !'laya blc at such place and in such form , shall ca rry suc h
registration pri vil eges, shall be execu ted , and shall con tai n suc h tem1 s and cond iti ons , as s.:t forth in the
lnd enture. The maximum net effective i11tcre s1 mte on th e Oond s shlt ll not exceed 12.00% per annum .
Secti on 11 -5 7-2 04 of th e Public Secu rities Act provides th at a public entity, including th e City. may elect
in an act or iss uance to apply all or any of th e provisions of the Public Sec urities Act. The Cit y hereby
e lec ts to ap pl y all of the Publ ic Securities Act to the Bonds.
Sectio n 4. Sal l! of Bonds The pl aceme nt and purchase of th e Bonds pursuant to the tenns
of the Purchase Agreement be and the same arc in all res pe cts hereby approved , au th ori ze d and
confinned, a nd th e Mayor (or Mayor pro tern ) is hereby authori zed a nd directed to execute the Bonds and
• th e City Clerk is hereby auth ori ze d and dire cted to affix the se al of the Cit y and to att es t the Bond s and
each is hereby a uthori ze d 10 de li ve r the Bonds for and on behalf o f the City to th e Trustee for
authen ti cati on pursuant to the lndcntl,re . The Bonds shall be so ld 10 th e Und erw rit er fo r the purc hase
price as set forth in the Purchase Ag ree ment (s ubj ec t to the limitati ons set for th herein).
Sect ion 5. Deleg a tion . Pur suant to th e terms of th e Publi c Securities Ac t, the Chief
Financia l Officer is hereby delegated the auth orit y to es ta bli sh: (i) the tem,s up on whi ch th e intere st rate
or rat es of th e Bond s wi ll be dctcnnincd and th e pa ymen t date s therefore , provi ded thm th e net effe ctiv e
int eres t rntc for the Bond s shall not exc eed 12.00%; (i i) the pri or redempti on pro visions fo r th e Bond s,
provided , an y rede mptio n pr cn:ium there on shall 110 1 exceed 4% or the prin cip al amo unt to be red ee med ;
(iii) th e orig inal iss ue di sco unt or premium th ereo n shall no1 exceed -1 % or the agg regate principal amount
of th e Bond s; and (iv) the date s on whi ch th e Bond s shall mature , in cludin g th e amount s to mature in eac h
year. prov ided that , the fi na l maturit y date for any Bond shall not be later th an De cember 15, 203 4.
Sec ti on 6. Appro\•a l and Authorization or Documenls . The Ind enture , th e Financing
Ag rccmcn1 . th e Regulatory Agr ee ment , th e lnt crcredit or Agree ment and th e Purchase Agree ment be anrJ
the sa me arc in all respects hereby a ppro ved , authori ze d and confim1e d, :md the Ma yo r (o r Ma yor pro
tcm) is hereby authorized and directed to exec ut e and th e Cit y Clerk. is hereb y au th orize d an d directed to
• affix the sea l or th e City and to atte st the Indenture , th e Financin g Ag reement. the Regu lat ory Agree ment ,
1hc Intcrcrcditm Agreement :md the Purchas e Agreement in sub stantiall y th e forms and conlent as
presented to !he City on this dale , subjecl 10 the ap pro val of bond coun se l to th e Cit y, but with such
chang es, modificat io ns, addit io ns and de leti ons !h ere in es shall to them see m ne cessa ry, desirable or
appropria te , their execution there o r 10 consti tut e conclu sive evidence of their approval of any and all
changes, modification s. additions and deletion s from the fom1s thereof as before thi s date .
Se ction 7. All Actions Heretofore Take n. All actio ns (not inc ons istent with the provisions
of thi s Ordinance) hereto fo re take n by the City Counci l and the officers of the Cit) directed toward the
issuance and sale of the Bond s therefor arc hereby ratified, approved and con finned .
Section 8. Compliance with the Act. The following detenninations and findings are
hereby made in accordance with Sections 29-3-113 , 29-3-114 and 29-3-120 of the Act:
(a) The maximum amount nece ssary in each yea r to pay the principal of and the
interest on ·:he Bonds (based on the maximu m net effective interest rate s se t forth her ei n, assuming that
interest is paid monthly , and ass uming no redemption s) sha ll not exceed :
Principal
Year Amount
2004 s
2005
2006
2007
2008
2009
2010
20 11
2012
20 13
2014
2015
201 6
2017
2018
201 9
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
Interest
44,560
1,002 ,600
1,002 ,600
1,002,600
1,002,600
1,002,600
1,002,600
1,002,600
1,002 ,600
1,0 02,600
1,00 2,6 00
1,002 ,60 0
l ,00.'.,6 00
1,002 ,600
1,002,(-00
1,002 ,6 00
1,002,600
1,002 ,600
1,00 2,60 0
1,002,600
1,002 ,6 00
1,002 ,6 00
1,002 ,600
1,002,6 00
1,002,600
1,002 ,6 00
1,002,6 00
6
S 44 ,560
1,002 ,600
1,002,600
1,002,600
1,002 ,600
l,002 ,600
1,002 ,60 0
1,002 ,600
1,002,600
1,002 ,600
1,002,600
1,002 ,600
1,002 ,600
1,002 ,600
1,002 ,600
1,002 ,600
1,00 2,600
1,002 ,600
1,002,600
1,002 ,6 00
1,002 ,600
1,002,600
1,002 ,600
1,002 ,600
1,002 ,600
1,002,600
1,002 ,600
•
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•
20 .l l
}032
2033
20 34 8.355,000
1.002.600
1.002.600
1,002 ,600
1.002.600
1,002 ,6 00
1,002,600
1.002.600
9.357 ,W0
(b) Pursuant to the In denture ther e shall be estab li shed certai n debt service reserve
fund s for pa yment of the Bo nd s, whi ch re se rves arc rcquircJ to be repleni shed from time to time , if
necessary, fr om Re ve nu es (as defi ned in th e Indenture).
(c) In the Financin g Agreement, th e Owner has covcnanl cd to maint ain , or cause to
be maintain ed, the Proj ec t and to carry , or cause to be carried , :1\J prope r insuran ce with re spect thereto.
(d) Th e reve nue s and oth er amou nt s paya ble und er th e Financin g Ag reemen t are
su ffi cient to pay , in ;1ddi ti on to all ot her req uiremen ts of the Fina ncin g Agreement and thi s Ordinance, all
sum s re ferred to in paragraphs (a). (b) and (c) of this Section and a ll taxes or pa yment s in li eu of ta xes
levied upon the Proje ct.
Secti on 9. ln,•estnients. Proceed s from th e sa le of th e Bonds ar.d speci al fund s from the
re ve nu es fr om the Refunding Projec t shall be invested and rein ves ted in such sec uritie s and oth er
invest ment s spccif . ..:d in , and otherwi se in acco rdance with, the Ind enture nod Secti on 29 -3-109 of the Ac t
and Section 24-75-601.1 of the Public Securities Act.
Sec ti on 10. Authority to Execute and Deliver Additional Documents. The o ffic ers ,
emp loyees and a0 ent s of the City shall take all ac ti on in co nformity with the Act, th e Public Securities
Act and the Cha rt er necessary or reasonab ly required to effectuate the issua nc e of th ,:. Bonds and shall
take all ac ti on necessary or desira bl e in co nfom1ity wi th the Act and the Chart er to fin anc e th e po rti on of
the costs of the Proj ec t to be finan ce d wi th pro ce ed s of th e Bond s and fo r ca rr ying out , givi ng effect to
and consum matin g the tran sacti ons cont emplat ed by thi s Ordinance , th e Finan ci r:g Ag re emen t, th e
Indent ure, the Re gulatory Ag reeme nt , th e lnt ercrcditor Agree ment and the Pu rc h.i se Ag ree men t including
without limit ati on th e ex ecuti on , delivery and filing of an y docu men ts, s1a1crn cnts or reports with the
United St .:1tcs Int ern al Rev enue Se rvice or with th e Secretary of th e Unit ed States Treas ury or hi s delegate
1;~cessary to mai nt ai n the exclusion of int eres t on th e Bond s fr om gross in co me for fedcn•.I in co me ta x
purp oses, the exec uti on of any letter of rep rese nt at ion or s im ilar doc um ent required of any sec uriti es
deriository, and th e execu ti on and t.!r•l!\1ery of addi tiona l sec urit y doc uments and any cl os ing doc ument s to
be d\·live red in co nne ctio n with th e sale and delivery of the Bond s.
Sectio n 11. Bond s arc Limited Obligations . The Bond s shall be special , limited obli gation ::
of th e Cit y pa yab le so lel y fr om the receip ts and reve nu es of th e Cit y und er th : Fi nanci ng Agreement 1~~1
are s pecifica ll y pledge d therefor under th e Ind entu re; the Bonds shall neve r co n: .. ,tute a deb t or
ind cb 1cdn css o f th e Cit y, th e State or :my co unt y, mun icipa lity or po li tica l subdi vis ion of lh c Stnlc wi th in
th e mcn ni ng of any provi s ion or limi tati on of th e Co nsi ituti on or sta tut es of the Stat e or th e cha11er of uny
po lit ical subdi vis ion of the S1:1 1c; and th e Bond s shall neve r con stitute nor give ri se to uny pec unia ry
li ab ilit y nf', or a charge agai nst the genera l c;cd it or taxing power s of, th e Cit y, th e S1atc or any co unt y,
muni cipa lity or polit ica l s ubdi vis ion of the State . The Bonds shall not ro nst itutc a ··multi ple fi sca l yea r
dir ec t or ind ir ec t debt or oth er fi nanc ial ob li ga ti on" of th e Cit y und er Arti cle X, Secti on 20 of the
Colorado Co nst ituti on.
Sec ti on 12 . No Pt cunlary Li a bility. Nothi ng co nt ained in thi s Ord in ance or in the Bonds,
the Finan cing Ag reeme nt , th e Ind enture, th e Re gulatory Ag reem ent , th e lnt ercredi tor Ag reement or the
Purchase Agreemen1 or any other instrument shall give ri se to a pecuni ary li abi lity of, or a charge upon
the gen era l credit or taxing powers of, the City, the State or any county, muni cipality or poli tica l
!..Ubdivi sion of th e Slate. The breach by any party of any ag reem ent co nt ni neJ in thi s Ordin ance, th e
Bonds, the Financing Agreement , th e Indenture , the Regu latory Agree ment , th e lnt ercre dit or Agreement
or the Purcha se Agre nent or any other in strument shall not impose any pecuni ary lia bility upon, or any
charge up on the ,eral credit or tax in g pow ers of, the City , th e State or any county , muni cipality or
political subdivision of the State, none of whi ch has th e powe r to pay out of it s general fund , or ot he["\v ise
con1ribu1e1 any part of the cos t of re finan cing the Proje ct, or powe r to operate the Project as a business or
in any manner.
Secti on 13.
prop eny for the Proje ct.
Soc tion 14.
No Condemnation by City. The Ci ty shall not condem n any land or other
Trustee a nd Remarketing Agenl. The Dank of New York is hereby ap pointed
as Trustee and Pt.y ing Agent under the Ind entur e and Merrill Lynch , Pierce, Fenner & Smith
ln co rpom tcd, is hereby appointed as Rema rketi ng Agen t pursuan t to th e tcnn s of th e Ind enture .
Sect ion 15 . Supplemental Ordinances. Th e City may, su bje ct to the terms and co nditi ons
of the Ind enture, pass and exec ute ordina nces supplemental to thi s Ordin ance wh ich shall not be
incon sistent with the tcnns ar..d provisions hereof
Se ction 16 . Limitation of Rights . With th e exc-:p ti on of any right s here in exp rrlis ly
conferred, nothing expres sed or memi oned in or to be impli ed from th e Ordi nance or th e Bond s is
intended or sha ll bl! co nstrued to give to any person, other th an th e Cit y, the Ow ner, the Underwriter an d
the ow ners of the Bonds , ;my lega l or eq uit ab le ri ght , remed y or claim und er or wi th res pec t to th is
Ordi11:-1 :..:\: or an y covenant s, cond iti ons and prov isions herein co nt ai ned ; thi s Ordinan ce and all of th e
cove nant s, co nditi ons and provisions hereof being int ended to be nnd being fo r the so le and exc lu sive
ben efit of the City, th e Owner. th e UndC["\V rit cr and th e ow ners of 1hc Bon ds as herein prov ided .
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Sec tion 17. Pled ge of RC\'l'llUCS, The crca 1ion. pc rfcc1i on, enforcement , and pr io ri1 y of !h e
• pk dge o f th e Revenue s 10 sec ur e or pay the Bonds as provided herein and in the Inden tur e sha ll be
gove rn ed hy Sec tion 11 -57-208 o f th e Pub lic Secur ities Act a nd thi s Ordin :mce . Th e Re ve nu es fo r th e
pay ment o f th e Bonds, as re ce ived by or oth erwise cred i1 ed to the City, shall immediately be s ubj ec t to
th e li en o f suc h pledge with ou t any ph ys ica l de li very, filing , or furthe r ac t. Th e lien o f suc h pledge on th e
Re ve nu es shall have priority ove r any or all oth er ob ligation s and li abil i1i es of th e Cit y. Th e li en of suc h
pledge shall be valid, bindin g, and enforceab le as aga in st all person s h.:iv in 1, cla 'ms of any ki nd in tort ,
contrac t, or oth erwise aga in st the Ci ty irre spec ti ve o f whet her such perso ns have noti ce of suc h liens .
Section 18. Official Stat emen t. Th e Cit y ac kn ow ledge s th at the Und cnv riter shall use an
Offi cia l Statement in con nec tio n wi th the offeri ng o f th e Bond s, and th e Chief Fin ancia l Offi ce r is hereb y
auth ori ze d to ce nify as to th e acc ura cy of the information co nce rnin g th e City con tai ned the rein .
Section 19. Immunity of Officers. Pursu ant to Secti on 11 -5 7-209 of th e Publi c Sec uri ties
Ac t, if a member of th e Co un cil , or any officer or age nt of th e Cit y ac ts in good fa ith , no civil reco ur se
shall be ava il ab le ag ains t su ch co uncil memb er, office r, or age nt fo r payme nt of th e principal of or
interes t on th e Bond s . No recourse fo r th e pay ment of any part of the principa l of, premium , if any, or
int ere st on th e Bonds fo r th e sa ti sfac ti on of any li ab ilit y aris in g from , fou nd ed upon or exis tin g by rea so n
of th e iss ue , pur~hase or ow nership of the Bond s shall be had aga in st any offi cia l, officer , co uncil memb er
• or age nt o f the Ci ty or th e State, all s uch li abilit y to be ex press ly rel eased and wai ved as a co nditi on of
and as a part of th e considerati on for the issue , sa le and purchas e of the Bonds.
Section 20 . Limitations on Actions . In accordance with thl! Act, no ac ti on shall be
brought q uest ioni ng the lega lit y of any co ntra ct, finan cing ag reemen t, mortgage, tru st ind enture ,
proceeding relating to th e Bond s or the Bond s, the Refu nding Project or th e Projec t on and after thirt y
da ys from th e effective date o f this O!'dina nce.
Secti on 21. Counterparts . Thi s Ordinance may be sim ultan eo usly exec uted in several
co unterp arts , eac h o f whi ch shall be an original and all of whi ch shall constitute but one and th e sa me
instrnm ent.
Secti on 22 . Captio ns. The captions or head in gs in thi s Ordi nance arc fo r co nvenience on ly
und in no way defi ne, limit or desc ribe the scope or 111 tcnt of any prov isions or sec tions of thi s Ordin anc e.
Sec ti on 23 . Validi ty of Bonds . Eac h Bond sha ll contai n a rc cit ;1I tl wt s uch Bond is issued
pu rsua nt to th e Act and the Pub lic Sec uritie s Act . and such rec iia l shall be co nclu sive evide nce of its
va lidit y and of the reg ularity of it s issu.mcc .
Section 24 . Irrepca lnb ilit y. Aft er any of the Bond s ure iss ued, thi s Ordi nance shall be and
remai n irrcpc alab le unt il th e Bond s and the int eres t th ereo n shall have bee n fu ll y paid , can cel ed and
di scha rged .
Scc 1ion 25 . Se ,•enablllty. If any sec tion. pnr:1grnp h. clause or prov ision of thi s Or<linu n· ..
shall fo r any rea so n be held to be inva li d or uncnforce11b le, th e in va lidit y or unenforcc:abi lit y of sudi
section , paragraph, cl ause or provision shall not afTcct nny of the rem ai ning pr0\1isio ns of 1hi s Ordin ance .
Section ~6 . Repe ale r. All orders, ordinan ces, reso luti ons, by laws , and regu lntio ns of th e
Cit y, or parts there of, inconsi stent wi th thi s Ordi mmcc arc hereby repea led to th e ex tent onl y of suc h
in co nsist ency.
Int rod uced, read in full , and pass ed on fir st reading on th e 18th day of October, 2004 .
Publi shed ns a Bill fo r an Ordinance on the 22 nd day of Oc tober, 2004.
Co rrected pub li cati on publi shed as a Bill for an Ordi nance on the 29'' day of Octo ber, 2004 .
Publi c Com ment was held on the I st day of November, 2004 .
Read by tit le and pa ssed on final re ading on the 15 th day ofNovcmber, 2004 .
Pub li shed h tit le as Ord inance No .~Series of 2004, on the 19th da of No ember, 2004 .
I, Lo ucri shi a A. Ellis , Ci ty Clerk of th e City of Eng lewood, Co lorado, he reby ce rtify th at th e abov e
and f}>_r~g~ing is a true copy of th e Ordinan ce passed on fin al reading and p ishcd by ti tl e as Ordinance
No . ~cries of 2004.
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COUNCIL CO MMU NICATION
Date: Agenda It em: Subject :
O cto ber 18, 2004 11 a ii Bill fo r an ordin ance approvin g a refunding of
th e Marks Apartment s Variab le Rat e D emand
Mult ifa mil y H ousi ng Reve nu e Bonds,
Se ri es B of 1985
Initiated By: I Staff Source :
Oepart mr nt or Finan ce and Adm inistrati ve Serv ices Frank G ryg lewicz, Direc tor
COUNCIL GOAL AN D P~EVIOUS COUNC IL ACTI ON
Co uncil has support ed th e constru cti on of affordable hous ing in th e City o f Engl ewood. The bon ds
were o rigin all y us ed to const ru ct th e Marks housing proj ec t. City Council approved th e issuanc e of
th e bonds w ith Ordina nce 69, Seri es of 1985. Th e Co un ci l auth ori zed am endments to th e
fin ancin g docum en ts and approved th e sa le and transfer of th e proj ec t to W ell sford w ith Ordinance
47, Se ri es of 1993. Counci l app roved ame ndments to th e financing doc uments wi th Ordinance 72,
Seri es of 1994 as well.
RECOMMENDED ACT ION
Staff reco mm ends City Co unci l approve thi s ac tion.
BACKGROUND, ANALYS IS, AND ALTERN ATIVES ID ENTIFIED
The bo nds th at we re o ri ginall y iss ued fo r th e Mark s ho usin g projec t were industri al deve lopment
bonds . Th is typ e of bond may be iss ued by a pri va te entity fo r very spec ific proI ec ls , includin g
housin g. Th e bo nd s are issu ed using th e Ci ty 's tax exe mpt statu s 10 issue debt th at pays tax-exempt
in teres t to bondholders . Th e tax exe mpt sl alus lo\\'ers th e cos t of borr owing and, th erefo re, ma y
prov id e an incentive 10 a deve loper to tak e 0 11 a project th at might not o th erw ise be un de rt aken.
Alth ough th e iss uer us es th e tax exe mpt stat us of th e City of Englewood, th e Ci ty does not ta ke o n
any responsibili ty for th e repa yment of debt. Th e Ci ty does assume so me ri sk of loss of reput ati on
and nu is an ce laws uit s in th e eve nt of a defa ult .
The Cit y is iss uin g th ese v~uiab le ra te dema nd mul ti fam il y housin g refundin g bonds in th e am ount of
$8,355,000 10 provide fu nd s 10 refund th e entire $8 ,35 5,00G in o ut standing principal of th e
Multi famil y H ousin g Re ve nu e Bo nds (Marks Eas t Apa rtm ents) 1985 Se ries B, w hi ch were issued to
provide finan ci ng for th e ac qui siti on, co nstructi on, and equ ipping of th e Marks East A partm ents, a
336-un it multifamily housin g fa cility loca ted in Engl ewood.
Both th e Ci ty Att orn ey and Ku l ak Roc k, the Cit y's ou tsi de bond coun se l, have reviewed th e
docu ments related to th e proposed refunding and have give n th eir app rova l.
FIN ANC IAL IMPACT
Th e de b1 serv ice pa 1•111 ents are not mad e by th e Ci ty of Eng lewoo d. Th e Ci ty will coll ec t a fee of
betw een 1 () and 40 basis poinls and wi ll be reimb ur se d for all ex pense direc tly relat ed lo lh e
refundin g.
LIST OF ATTACHMENTS
Prop osed bill for an ordinan ce.
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