HomeMy WebLinkAbout1996 Ordinance No. 044•
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ORDINANCE NO . .:!!I-~
SERIES OF 1996
DY AUTHORITY
COUNCIL BILL NO . 47
INTRODUCEDBYCOUNCIL
MEMBER HATHAWAY
AN ORDINANCE AUTHORlZING THE ISSUANCE AND SALE OF THE CITY
OF ENGLEWOOD , COLORADO MULT IFAMILY HOUS ING REVENUE
REFUNDING BONDS (MARKS APARTMENTS PROJECT) SERJES 1996 IN THE
AGGREGATE PRJNCIPAL AMOUNT OF $11,200,000, TO REFUND PRIOR
BONDS OF THE CITY AND TO PROVIDE FINANCING FOR RESIDENTIAL
FACILITIF.S FOR LOW-AND MIDDLE-INCOME FAMILIES AND PERSONS ;
RAT IFYING CERTAIN ACTION HE RETOFORE TI.It F.N ; ACKNOWLEDGING
THE USE OF A PRELIMINARY AND FINAL C..'l'JC.1.AL STATEMENT AND
THE EXECUTION ANU DELIVERY BY THE CITY OF A CERTAIN
INDENTURE OF TRUST , LOAN AGREEMENT , AMENDED AND RESTATED
LAND USE RESTRICTION AGREEMENT , BOND PURCHASE AGREEMENT ,
SUCH BONDS AND CLOSING DOCU MENTS IN CONNECTION THEREWITH ;
MAKING DETERMI NATION S AS TO "LOW -AND MIDDLE -IN COME
FAMILIES AND PERSONS ." AS TO THE SUFFICIENCY OF REV"'.:.NUW AND
AS TO OTHER MATTERS RELATED TO THE RESIDENTIAL FACILITIES TO
BE FIN ANCED ; REPEALING ACTIO N HERETOFORE TAKEN IN CONFLICT
HEREWITH .
WHERE AS , the City of En glewood , Co lorad o (the "City") is authorized by the
County and MunicipaHty Dev elopm ent Re venue Bond Act, constituting Sections 29-3-101
through 29 -3-123, inclusi ve , Co lora do Revised Statutes (the • Act "), to finan ce and refinance one or
more proj~. includ in g any l and , bui lding or other improvem ent, and all real and personal
properties. whether or not in existen ce , whith shal.l be suitabl e fo r res id ential fa cilities for l ow-
an d middle-income famili es or persons and intended for use as the sole place of resid e nc e by the
owners or intended occup an ts to th e en d that more ad equate residential housing facilities for low -
and middl e-in co me fam ili es and pe rso ns may be provi ded , which prom ou, the public hea lth ,
welfare , s afety , convenience and pros pe rity; and
WHEREAS , the Act au thoriz es the City (i) to iss ue i reve nu e bonds for U,e purpose
of defraying the cost of finan cin g or refi nancin g any proj ec t and all incidental expe nses incurr ~d
in conn ec tion with the iss uance of such bond s. (iii to enter in to financi ng agreement s with oth ers
fo r the purpose of providing re ve nu es to pay the bo nd s authorized to be issued und e r the Act an d
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upon such terma and condition• u the City Council o( 1he City rJ1 1l)I deem adviaable, and (iii) to
aecur e the payment of the principal of, promium, if any, and int.:re■l on •~ bonda u provided in
the Act; and
WHEREAS , becauae bond a iosued punulllll to the Act do not cre~.le a multiple-fiscal
year direct or indirect debt or other financi&l obligation of the City, the Donda are not subject tD the
provisions of Article X, Section 20 of th e Colorado Constitution ; and
WHEREAS, •lie City previously l11 ued and sold ill Variable Ra w Demand
'l!u lt1family Rental Housin g Revenue Bonda (The M••~• .-\po rtmenta) 1985 Serie• A, in the
aggregate princ pal amount of $12,200,000 (the 'Prior Bond s '), in order to provide financing to HG
Venture, a Tena limited partnenbip, who has aubsequently 888igned ill inwrest in the Project (as
detined herein ) tD Wellsford Marlu West Corp ., a Colondo corporation (the "Owner'), for the
aeq ui sition . construction and installation of a multifamily rental houoing project (the 'Proj ect')
localed within the City, tD be occupied pntially by individuals of low or modente incom e within
the meaning of a.nd for the period "eq uired _by Section 103(bX12) of the Internal Revenue Code of
1954 , as amended (the '1954 Code "), all for the public purpose of providing more adequate
resid ent ial housin g facilitie s for low -and middl e-income familie s and persons; a nd
WHEREAS , the Owner has requested the City refund the Prior Bonds ; a.nd
WHEREAS , the City bas determined that it is advisable and in the best in terests of
the City to iss ue its Multi famil y Housing Rev enue Refunding Bon ds (Marks Apartments Proj ec t )
Series 1996 in the aggregate principal amount of $11,200,000 (the "Bond s '), tD sell a.nd deliv er tl1e
Bonds lo First Chicago Capi tal Markets, Inc ., as the underwriter of the Bonds (the "U nd erwriter"),
tD r efu nd the Prior Bonds and provi de financing tD the Owner for the Proj ect, tD be oc cupied by
persons of low and middl e income, as determined by the City , a.nd occupied partia.lly by
inrlividual s of low and moderate inco me within the -:neaning of and for the period r quired by
Section 103(bX12) of the 1954 Code and by those prov isi ons of the Internal Reven ue Code of 1986, as
amend ed (the 'Code"), whi ch are a ppli cable there!<>, all for the public purp.-.;e of providing more
adequate residentia l housi ng faciliti es fo r l~w and middl e inc ome families and persons; and
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WHEREAS, in order ID provide ■uch financin11, the City will i11ue the Bonda ID
make a loan ID the Owner, the repayment of which will be evi d enced by the Loan Agreement
described below of the Owner; and
WHEREAS, there have been presented ID the City Council (i) the proposed form of
Loan Agreement, dated as of October 1, 1996, betwe<'.n the City and the Own,,, (the "Loan
Agr eement"), (ii ) the proposed form of lndentun, of Trust with respect ID the Bonda, dated aa of
October 1, 1996 (the "Indenture"), between the City and American National Bank and Trus t
Company of Chicago, Chicago, Illinois, as Trustee (the "Trustee"), (iii) the proposed form of
Amended a.nd Restated Land Use Restriction Agreement with respect ID the Project, dated as of
October 1. 1996 (the "Regulatory Agreement''), among the City, the Trustee and the Owner, (iv ) the
proposed form of Bond Purchase Agreement with r-<S pect to the Bonds (the "Purchase Contract")
among the City, the Owner and the Undecwriter, and (v ) the form of Preliminary Official
Statement, to be distributed b)' the Undecwriter to prospective purchasers of the Bonds.
NOW, THEREFORE, BE IT ORDAINED RY THE CITY COUNCIL OF THE CITY
OF ENG LEW 0OD, COLORADO THAT :
~!i.Qll.l. All action (not in consistent with the provisions of this ordinance)
heretofore taken by the City Council and the officer,; of the City directed toward the finanr.ing of the
Proj ect and the issuance and sale of the Bonds therefor be , and the same is hereby, ratified ,
approv ed an d co nfirm ed .
The City shall finance the. Proj ect , subj ec t to the terms of the Loan
Agreement. the Indenture, and the Regulatory Agreement , by the issue, seJc: !lu..i. deli very of th:•
Bonds to obtain funds to loa n to the Owner·, in ord er to provid e finan cing ~ i..¼ Own er for the
Pr oj ect.
To defray the cost of financing for the Pr ojec t, there is h e reby
authori zed and created Bll issue of revenue bonds designated "City of Engl ewood, Colorado
Mul t ifa•.,1ly H ousing Revenu e Refunrling Bonds (Marks Apartments Proj ect ) Series 1996" in the
ag gr egate principal amount of $11,200,000, 1,,suabl e as full y registered bond s without coupons in
de nomin ation s of $5 ,000 or any integral mv:tiple the reof, each dated as of th eir date of issuance,
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bearing interest on the unpaid principal amount thereof, payable (except •• provided below )
aemlannually on Jtms 1 and December 1 of each year commencint June 1, 199'/. The Bonda shall
mature on December 1, 2026 . The interest rate on the Bonds shall be eetabU.hed by the
Remarketing Agent (as defined in the Inde nture) for the initial IAJ;-m of the Bond s a, provided in
the Indenture at an interest rate per ann 11m ·,hich if borne by the Bonds , would, having du e regard
to prevailing financial mark et conditiont ,. be the lowest rate of interest necesfl try to enable the
Remark eting Agent to sell the Boods on th e issuance date and on each au(.ro eding ';'Ar de r Date , if
any, fo r• price equal to 100% of the principal amount thereof and provided nu s uch rate shall ever
exceed 8 .5 0%.
The Bonds shall be payable , shall 1:.e subject In redemption prior t:> Gl.':urity, and
shall be in substantially the form as set forth in the Ind enture. Pursuant In the ,'urch1Ue Co ntract,
the Bonds shall 1:.e sold In the Underwriter at the purchase price oet forth tho:oin . Th e maximum
net effective in terest rate on the Bonds is iireater than 8.~ per annum. wtu ,h rate is hereby
determined to be the maximum net effective interest rate on the Bonds .
Pursuant to Ser•. ii 29-3-1 03(10Xdl of the Act , the City Council of the
City hereby finds and determines that for purpose, of multifamily rental housing proj ects such as
the Project , "low-and middle-income persons and families" means and includes any person •
whose Adju sted Inco me (as defmed in the Regu latory Agreemen;), together with the Adjus t ed
Inc ome of all peT'Sons who intend to reside ~th such person in one dw elling unit, did not for tht
taxable year immedi etely preceding their initial occ upan cy of such dw ellin g unit, exceed an
amount equal to 175% of the median gross income for the area (as determined und er the Loan
. .\gr1:~ment), or s uch other amount as may be est.ablishcd fr om time to time by the City Co uncil of
the City , in accordancP ·.vith the Act, as the n ..... lu1um incom e fo r "low-and middl e-i nc ome
persons and families" within the meaning of the Act , and that such persons and families lack the
financial ability to pay rentals sufficient to induce private enterprise in the City to build a
sufficient sup ply of ad equate, safe and sanitary dw elhngs without the special assistance afTord 0 d
by the Act .
~. 'l'he foll owing determin ations and findin 't S are hereby made in
accordan ce with Sections 29-3-113, 29-3-114 and 29-3-120 of the Act .
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(a) The muimum amount neceuuy in •ach year 1D pay the principal • of and the intereat on the Bonda is u follow a:
:au ~ llumat Annual IW!Sllmf:
Iw,uirement
l998 $ -0-$238,000 $238,000
1997 -0-952,000 952,000
1998 -0 -952,000 952,000
1009 -0-952,000 952,000
2000 -0-952,000 952,000
1ml -0-952,000 952,000
2002 -0-952,000 952,000
2003 -0-952,000 952,000
l!004 -0-952,000 952,000
Dl5 -0-952,000 952,000
200; -0-952,000 952,000
'1IX11 -0-952,COO 952,000
200; -0-952,000 952,000
2DOO -0-952,000 952,000
:a'.>10 -0-952.(J()() 952.000
:a'.>U -0-9."~000 952,000
:a'.>13 -0-,152,000 952,000
:a'.>14 -0-952,000 952,0GO
1!1)15 -0-952,000 952,000
:a'.>16 -0-952,000 952,000 • :a'.>17 -0-952,000 952,000
:a'.>18 -C -952,000 952,000
:.D l9 -0-952,000 952,000
l'02I) -0-952,000 952,000
2'.121 -0-952,000 952,000 = -0-952,000 952,000
202:l 952,000 952,000 = -G-952,000 952,000
l!025 -0 -952,000 952,000
2lY26 11200,000 952,0CO 12.152,000
T otal : $ 11,200,000 $27,486,000 $ 38,486,000
(b ) The terms uud, r which the Project is to be financed provide that the
Owner shall maintain the Project in goo<, repair and carry all proper insurance with respect
thereto.
(c ) 11'lc revenues payable under the finnndng documen•..a with res pect
ID the Oonds and the Project are sufficient to pay, in addition to all other requirements of ou ch
finan cing document.s and this ordinanee, all sums referred to in paragraph (a ) of this Section .
(d ) Since the Project is owned by the Owner, which is a private l egal
entity. pursuant to Section 29-3-120 of the Act the financing docurc ents with reopect to the Project
require the Owner to pay nil lrutes due, with respect to the Project, to the State of Colorado, to the City,
and to the school dist :-;1.~ i nd all other political subdivisions and public bodies corporate whe rein
the Project is loc ated, a uthorized to levy taxes .
Th e forms , term s a.nd provisions of the Lvan Agreement, the
Indenture, the Regulstory Agreem ent and the Purchase Contract are hereby approved and the City
shall enter into the Loan Agree ment, the Ir.denture, the Regulatory Agr;,ement and the Purch•se
Co ntract s ubstantially in the forms ofsuch doc u ments presented to the City Council at this meeting
with s uch changes therein which are approv ed by the City Attorney ; and the Mayor nf the City i s
here by authorized and directed tD execute and rl elivP r the Loan Agreement, the lnc.'.4tmture, the
Regu lat ory Agreo ment and the Purchase Contract and the City Clerk 1s h ereby authorized a nd
directed tD affix the Ci ty seal to and to attest the Lo an Agreement, the Ind enture, th.. Regul at ory
Agreement an d th e Purchase Con trac t.
51:ilio.n.1 The City acknowl edges the use by tile Und erwriter of the
Preliminary Offi ci al Statement in connection with th .! offering of the Bond s to tle public. Th e City
ac kn owl e dges the use by the Unde rw ri t rs in c .:m ect ion with the sale of the Uond s of a fina l
offi cial statement (the "Offici al Statement") to be prepared by the Underwri t er and to be
substanti all y in the fo rm oi the Preliminary Official Statement but co ntain i •g s uch a mendments
as may be deemed a ppropri ate by th e Underwriter. The City makes no re present ation or w a rranty
as to. and has no responsibility fo r, the accu ra cy or co mpl et enes11 of the in fo rm ati on co ntained i r.
the Preli m ina ry Offi cio I Statement or the Offi cial State men t and , furthe rm ore, is not a n
"o bligated perso n " p urs uant to Rul e 15c2-J2 und er the Sec urit ies Exch ange Act of 1934 .
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~ The formo , term, and provi1iona of Ibo Bonda, 1ubatantially in the
form contained in the Indenture, are hereby approved; and the M1~r oC the City i1 hereby
authorized and ~ to execute the Bondi ,.nd the City Clerk ii h.eroby authori1ed and directed to
affix the oeal of the City to the Bonds and to att.eot the Bond i . The 1icnature1 of the Mayor and the
City Clerk on the Bonds and the seal of the City on the Bonds 1hall be affixed manually or by
facsimile .
The Mayor ir hereby authorized and directed to ex.cute and deliver
to the Trustee the wrilU!n order of the Cir; for the authentication and delivery of the Bonds by the
Trustee, in accordance with the Indenture.
SWism.lQ. American National Banlt and Trust Company of Chicago, Chicago ,
Illinois, is hereby appointed Trustee under the Indenture.
Th e officers of the City ,hall take all action in conformity with the
Act neceseary or reasonably requ ired ill effectuate the issuance of the Bond s and shall take a II
action in conformity with the Act necessary or desirable to finance the Proj ect and for carrying
out., giving effect to and co n s ummating the transactions contemplated by ll.US ordinance and the
Loom Agreement, the Indenture, the Regulatory Agreem ent and the Purtllase Co ntract , inc ludin g
withwt limitation , the execution and deliv ery of any clo sing documents to be delivered in
connection vdth \:he salt and deliv ery of the Bonds .
Sw.iwiJ2, The cost of fi nancing the Proj ect will only be paid out of the proceeds
of the Bonds and none of the Bon ds will be the ge n eral obligati on of the City nor sh all any of the
Bonds , incl u ding interest thereon , co nstitute the debt or indebtedness of the City within the
mea"li n g of the Co n stitution or statutes of the State of Color ado or of d .e home rule charter of an y
po litical subdivision thereof, including the City, nor shall Bn )~hing contained in this ordinance
or in the Bonds. the Loan Agreement, the Indenture, the Regulatory Agreement or the Purchase
Contract , or any other instrument give rise to a pecuniary liability of the City or a charge upon the
gener al credit or taxing power s of the City, nor s h all the breach of any agreement contained in thi s
ordinar,ce , the Bonds, the Lo an Agreement, the Ind ent ure, the Regulatory Agree ment or the
Purchase Contrar:t impose any pec uniary liabili ty on the Ci ty or a charge upon the general credit or
taxing pow ers of the City, the Ci ty having no pc-·~·er 'X> pay out of its giuer al fund, or otherwis e
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contribute any part of the coots of financing the Project, nor power 1D operate the Project aa a
business or in any manne,·, nor shall the City condemn any land or other property for the Project
nor contribute any land or other property to \he Project. Nothing contained in this ordinance or the
Loan Agreement, the Indenture, the 'letnilatory Agreement or the Purchase Contract shall give
rise to any personal or pecuniary liability ofe!:.y officer, employee or agent of the City.
After any of the Bonds are issued , this ordinance shall be and
remain irrepealable until the Bond s and the interest thereon shall have been fully paid , cancelled
and discharged .
SwilmJ.4 . If an y section, paragraph , cla use or provis ion of this ordinance
shall for any reason be held tn be in 11alid or unenforceable, the invalidity or une nforceability of
such section , paragraph , clause or provision shall not effect any of the remain ing provisitms of
this ordinance.
Ss:d.iluu5 . All bylaws , orders, resolutions and ordinances , or µarts thereof,
,istent h erewith and with the doc uments h ereby approved , are hereby repealed to the extent
onl)' of s uch inconsistency . This repealer .shall not be construed as re\;ving any bylaw , order ,
resol ution or ordinance, or 1Jart thereof.
ll.etlilm..lli . This ordinance shall be in full force and effect immediately upon
enactment following final passage. This ordinance shall be r eco rd ed in the City Book of
Ord inan ce s kept fo r that purpose , and sh all be authenticated by the signatures of the Mayor and
City Clerk , and publis hed in accordance with law .
lntrod •,r.ed , rend in full, and passed on fir st readin g on the 16th day of September. 1996 .
Publi s hed as a Bill for an Ordinance on the 16h day of September 1996.
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Read by title and pBBSed on final reading on the 23rd day of September, 1996.
Published by titl e as Onlinance No . #.Series of 1396, on the 26th day of September, 19&6 .
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i::;,;;;.:;;hi,; A. Ellis, City Cle rk
I, Loucrishia A. Ellis, City Clerk of the City of Englewood, Colorado, hereby certify that the abov e
and fore go ing is,i~e copy of the Ordinance passed on final rea g and published by t itle as
Ordinance No . Xf Series of 1995 .
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COUNCIL COMMUNICATION
Date Agenda Item Subject
September 16 , 1996
11 a ii
Bill for an ord inance approving
credit enhancement for the Marxs
bonds .
Initiated By
Citv of Enalewood , F inancial Services Department
I Staff Source
F rank Grvaiewicz , Director
COUNCIL GOAL AND PREVIOUS COUNCIL ACTION
The City Council has supported efforts to improve both the Cily's housing stock and relations with the busine ss
community . This ord inan ce helps lhe Wellsford Marks West Corporalion , a corporate citizen prov iding housing
in the City of Eng lewood , to refund the City 's prior industri al developm ent re ve nue bonds , and therefore reduce
its long-term cost of pro vidi ng hoosing i:, Englewood .
RECOMMENDED ACTION
Sta ff recommends the City Council Bl ,prove the attached bill for an ordinance making ava ilable to the Wellsford
Marxs West Corporation, th e procee:,s. of bonds (not to exceed $11.2 million) ,a be used lo refinance a portion of
1he costs lhe the Marks Project wh ic'·. was originally fin anced with the City's Variable Rate Demand Multifamily
Housing Revenue Bonds (The Ma ,r : \partments), 1965. Series A. The maturity of the refunding bonds Is
expected to be extended 10 De ce •·. '"' 1, 2026 . Th is refund ing allows lhe Marks Project to be refinanced using
debt l hal is tax emempt. This tax exe mption lowers th• effecti ve cost of debt . and lherefore provides an
incent ive to firms providing hous i:19 projects to the commun ,ty .
This actio n is not subject 10 the provisions of TAB OR . T his is nol an obl igation of the City al Englewood .
Th e City will hold a public heari ng regardin0 th is act ion on September 23 , 1996 at 10 :00 a.m . as required by th e
Tax Equity and Fiscal Responsibil it y Act of 1982 (TEFRA).
The City Council is req uesled to hold a special meeti ng on September 23, 1996. The ex ist ing Letter of Cred i! for
th e Bonds, and cred,t agree ment betwee n th e Letter of Cred it Bank and Wellsford, expire s on October 25, 1996 .
A second and fina l re ad ing at the spe cial meeting re quested to be held oo Sept ember 23 , 1996 would put the
bond closi ng date on October 23, 1996 . T nis will allow tile bonds to clc,s e prior to expi rat ion of the Letter of
Cre~it
FINANCIAL IMPACT
Th e We lls ford Ma:-4<.s West Co rp ora ti on will rei mburse the City for all cos ts asso ci at ed with th is action .
LIST OF ATTACH MENTS
Proposed bill fo r ao ord inance
NOTICE OF SALE
Ciiy of Englewood, Colorado
Multifamily Houlling Revenue Refunding Bonds
(Marks Apartments Project)
Series 1996
Notice is hereby given that the City of Englewood, Colorado intends to lell to the
highest and best bidden for cub and to the best advantage of the City its Multifamily Housing
Revenue Refuoding Bonds (Mam Apartn-aits Project) Series 1996 in the aarepte principal amount
ofSl 1,200,000 (the "Boodsj ma11.1rq on December 1, 2026. The Bonda are to be issued punuant
to the Counly and Municipality Development Revenue Bond Act, Scctioos 29-3-101 through 29-3-
123. The purpoJe oftl-.e sale is to refinance a multifamily housing project known u the Maries
Apartments located 11 1701 Eat ~ Avm.ie. The apartment project is <'wned by Maries West
Corporation. Interested purdlasen should contact Mr. Frank Gryglewicz, Director of Fmancial
Services , City of Englewood, Colorado, 3400 South Elati Street. Englewood, Colorado 80110 ;
Phone : 762-2400 by 2 :00 noon on Monday, September 16, 199!:.
Dated . September 9, 1996.
Isl Franlc Grygl.:wicz
Director of Financial Services
City of Englewood, Colorado
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