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HomeMy WebLinkAbout1989-12-13 EURA MINUTESI. ENGLEWOOD URBAN RENEWAL AUTHORITY December 13, 1989 CALL TO ORDER. The special meeting of the Englewood Urban Renewal Authority was called to order by Chairman Robert J. Voth at 5:35 P.M. in Conference Room A of the En- g lewood City Hall. Members present: Members absent: Mcintyre, Minnick, Totton, Voth, Byrne Wanush, Executive Director/Executive Secretary Kee na, Cole Daugherty, Alternate Member Hanson, Alternate Member II. APPROVAL OF MINUTES. November 1, 1989 Chairman Voth stated that the Minutes of November 1, 1989 were to be con- sider ed for approval. Upon a motion by Mr. Minnick, second by Ms. Byrne, the Minutes were approved as written. III. FINANCIAL ADVISOR Bond Negotiation/Restructuring Mr. Wanush stated that requests for proposals had been mailed to nine firms, seven of which responded to the letter. Mr. Wanush stated that a committee composed of EURA members Totton and Byrne, EURA Counsel Benedetti, Assistant City Manager Martin, and himself reviewed the seven responses, and selected five firms to be interviewed. These interviews were conducted on December 6. Ms. Byrne was not able to participate in the interviews because of business constraints, but the other committee members (Totton, Benedetti, Martin and Wanush) talked to each of the five firms for approximately one hour and the majority of the committee recommends that the firm of Kirchner Moore & Company be engaged as financial advisor to the Authority to work on the bond negotiation/restructuring issue. Four of the firms were rated; the fifth firm is primarily a legal firm and they would have to have hired support services to accomplish the intent of the RFP. Mr. Wanush referred to an Evaluat ion Sheet which was prepared on each of the four rated firms, and discussed the strengths and weaknesses of the firms as perceived by the interview team. Mr. Wanush pointed out that Kirchner Moore is engaged in bond underwriting, but they have done financial advising in- dependently of the underwriting capability. He cited a list of jurisdictions for whom Kirchner Moore has worked, both in the metro area and within the State of Colorado as well as some jurisdictions outside of Colorado. Mr. Wanush stated that Kirchner Moore understands that if a recommendation of the analysis of the EURA bonds is to refinance the bond issue, Kirchner Moore will not participate in the refunding as an underwriter. - 1 - One concern raised by Assistant City Ma nager Martin is the fact that Kirchner Moore wa s a participant in the 1985 refunding of the bonds. Mr. Wanush stated that he and other committee me mbers discussed this with the Kirchner Moore repr e s e nt a tive s, a nd ar e s a tisfied that Kirchne r Moo r e h a d a v e ry minor part in the 1985 refunding, and that this project does not repre s ent a conflict of int e rest on their p a rt. Mr. Wanush furth e r discussed the othe r firms who were interviewed. Ms. By rne asked if Assista nt City Ma n a ger Martin felt that Kirchner Moore wa s "close" to the top choice. Mr . Wa nush stated that it was his opinion that Ms. Martin did f e el Kirchne r Moore was clo s e to the top choice, and that her con- cern was the particip a tion in the 1 9 85 refunding. Mr. Wanush sta ted that he ha s talke d to City Man a g e r Fraser about the interviews and resulting recommen- dation of the committee, and City Manager Fraser seems comfortable with the research and recommendation of the committee. Mr. Totton pointed out that Legal Counsel Paul Benedetti stated that he did not feel Kirchner Moore's participation in the 1985 refunding represented any problem. Mr. Totton commented briefly on other firms that were interviewed. Mr. Voth asked the reaction of the firms inte rviewed to the EURA's problem and what we hope to achieve in the end. Mr. Wanush stated that it is his opinion that all the firms interviewed were positive about the situation, and that they cited the fact that there is at least cash flow being generated in the EURA Tax Increment District. Troubled issues that they have seen have not all had positive cas h flow. While they all acknowledged a problem, they thought that it could have been worse. Discussion ensued. Mr. Wanush stated that there should be a report from Kirchner Moore by mid-February, with interim progress reports back to the staff and Authority before that date. Mr. Voth asked how things looked on the drawdown estimates from the Reserve Fund; at what point will the Reserve Fund be depleted. Mr. Wanush stated that approximately $130,000 was drawn down in December for the bond payment, and estimated that the Authority could be faced with a shortfall to make the pay- ments in June, 1991. Mr. Voth asked for a motion on the engagement of a Financial Advisor. Minnick moved: Byrne seconded: The Englewood Urban Renewal Authority authorize a contract with Kirchner Moore & Company to act as the EURA's Finan- cial Advisor on the bond negotiations/restructuring. AYES: Mcintyre, Minnick, Totton, Voth, Byrne NAYS: None ABSENT: Keena, Cole ABSTAIN: None The motion carried. Mr. Wanush stated that there is a need to hire a special legal consultant to work with Kirchner Moore on this is sue. Mr. Wanush stated that we need to have someone to interact with the consultant, and to assure that the EURA is protected as options are developed. Issues that might be raised by the need -2 - I for negotiation with bondholders and possible restructuring of the debt ser- vice were discussed. Mr. Wanush stated that the City of Englewood will also be involved since it is a source of payment for services, and suggested that EURA Counsel Benedetti and Assistant City Manager Martin be asked to recommend the legal counsel on the bond issue. Mr. Voth supported Mr. Wanush's sugges- tion; Mr. Totton pointed out that any recommendation would have to be approved by the EURA and a contract written and signed . IV. FIRST NATIONAL BANK RIGHT-OF-WAY Mr. Wa nush asked that the Authority to into Executive Session to discuss this matter. It was so moved, seconded, and carried to go into Executive Session . * * * * * * * * * * The Commission came out of Executive Session. V. DIRECTOR'S CHOICE. Mr . Wanush discussed the court proceedings on the Physical Whimsical case . Mr . Opperman, EURA Legal Counsel, has stated that no decision has been made. Mr. Wa nush reported that he has met with Mr. Gil Lipp of RCM Government Securities regarding the reserve fund repurchase agreement. Mr. Wanush stated that the Bel-air Savings had requested that we renegotiate the agreement. He discussed the ramifica t ions of pulling the reserve funds out of Bel-Air Savings since these funds would have to be reinvested at a lower rate than the 9.75% being paid through Bel-Air. To compensate for the loss in interest on the invested funds, the Authority should receive a premium if those funds are withdrawn from Bel-Air. The difficulty in determining the amount of the pre- mium is whether the funds may be invested at a constant rate, or whether the funds are invested at a flexible rate. Brief discussion ensued. There was no further business to come before the Authority, and the meeting adjourned at 6:10 P. M. Gertrude G. Welty Rec o rding Secretary -3 -