HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 06/15/2004 - FIRST READING OF ORDINANCE NO. 099, 2004, AUTHORIZ ITEM NUMBER: 14
AGENDA ITEM SUMMARY DATE: June 15, 2004
FORT COLLINS CITY COUNCIL STAFF: Harrison/Krcmarik/
Mannon
SUBJECT
First Reading of Ordinance No. 099, 2004, an Ordinance Approving and Authorizing the City of
Fort Collins, Colorado, to Enter into a Site Agreement Between the City and Fort Collins Capital
Leasing Corporation, a Lease Agreement Between the Corporation and the City, a Certificate
Purchase Agreement among the Corporation, the City and George k. Baum & Company and a
Financial Guaranty Agreement Between the City and the Certificate Insurer and Approving a Trust
Indenture Between the Corporation and the Trustee,a Leasehold Deed of Trust from the Corporation
to the Public Trustee of Latimer County for the Benefit of the Trustee and a Preliminary Official
Statement and a Final Official Statement Relating to Certain Lease Certificates of Participation,
Series2004A.
RECOMMENDATION
Staff recommends adoption of the Ordinance on First Reading.
FINANCIAL IMPACT
The total amount of Certificates of Participation ("COPS") to be authorized will be approximately
$30.1 million for the Police Services Building and$1.7 million for the Deicing Materials Storage
Facility. For the Police Building,the annual payments will be approximately$2.4 million per year.
Both the size of the transaction and the annual payments may change due to fluctuations in interest
rates. The source for repayment of the Police Services share of the annual payments will be the
City's General Fund,Capital Improvement Expansion fees,residual sums in prior dedicated quarter-
cents projects and interest earnings. Over the past three years,Council and City staff have earmarked
funds within the General Fund for this purpose. The source of the annual payments for the Streets
deicing storage facility will be the Transportation fund.
EXECUTIVE SUMMARY
The City has been planning for the construction of a Police Services building for many years.
Monies for the acquisition of land for the facility were approved by the voters as part of the Building
Community Choices dedicated quarter cent sales and use tax. Police Services, with the assistance
of Operations Services,has identified a site to serve as the location for the new facility. The building
will be approximately 92,800 square feet and will be located on approximately 10 acres of land on
the west side of Timberline Road between Drake and Prospect Roads. The cost of the Police
June 15, 2004 -2- Item No. 14
Services facility transaction, including land costs, will be approximately $30.1 million which
includes $585,000 in financing costs.
The lease transaction will also provide a funding source for the construction of a storage facility to
contain deicing materials at the City's existing Streets facility on North Lemay. The estimated cost
of the storage facility will be about$1.7 million with $30,000 of financing costs.
BACKGROUND
Police Buildine
A new Police Services building is part of the Police Services Strategic Plan and the City's Facility
Master Plan. The existing building at 300 LaPorte Avenue was not designed for a police agency and
is no longer suitable for a department the size of Police Services; the current staffing level is 245.5
employees. The new facility is necessary to maintain service to the community, conduct business,
and provide public safety.
The voter-approved Building Community Choices ("BCC") capital program included funding for
land acquisition and initial design for the new Police Building. A Police Services facility needs
assessment study was completed and indicated a 93,000 square foot building is required for a
centralized facility. If a decentralized approach (two buildings) were to be pursued the total size
would increase to 102,000 square feet.
Council and City staff have expressed a preference for a centralized facility. A ten-acre parcel of
land on Timberline Road has been identified for acquisition for the new facility. The cost estimate
of the facility is $30.1 million and includes land acquisition.
Please see the attached map for the site location.
Deicing Materials Storage Facility
A new Deicing Materials Storage Facility will be constructed for the Streets Department to store
roadway deicing materials,including deicing liquid tanks and a dispensing system.The structure will
provide a permanent enclosed space, holding up to 8,000 tons of material. The new structure is
designed to be corrosion resistant to all types of deicing materials including sand,salt,and ice slicer.
This structure will replace the historic warehouse building currently being used to store these
materials. The current historic warehouse building is rapidly deteriorating due to the storage of
corrosive materials, and it will be restored as an equipment storage facility.
Please see the attached map for the site location.
June 15, 2004 -3- Item No. 14
SOURCES AND USES OF LEASE CERTIFICATE FUNDS
Combined
Police Streets Cost of
Buildin Buildine Facilities
Sources
New Issue Certificates of Participation $29,515,000 $1,705,000 $31,220,000
Accrued Interest and Premium 570,000 25,000 595,000
Total Sources $30,085,000 $1,730,000 $31,815,000
Uses of Proceeds
Police Facility $29,500,000 $29,500,000
Streets Storage Facility $1,700,000 1,700,000
Cost of Issuance 96,600 4,300 100,900
Certificate Sales Costs 180,500 8,000 188,500
Lease Certificate Insurance 237,200 10,500 247,700
Surety Bond 70,400 3,200 73,600
Contingency 300 4,000 4,300
Total Uses $30,085,000 $1,730,000 $31,815,000
All of the figures above are based on market estimates as of June 3, 2004. Interest rates will
undoubtedly change between now and the sale of the certificates. The total size of the transaction
will be resized when the final information is available.
ORDINANCE NO. 099, 2004
AN ORDINANCE APPROVING AND AUTHORIZING THE
CITY OF FORT COLLINS, COLORADO, TO ENTER INTO A
SITE AGREEMENT BETWEEN THE CITY AND FORT
COLLINS CAPITAL LEASING CORPORATION, A LEASE
AGREEMENT BETWEEN THE CORPORATION AND THE
CITY, A CERTIFICATE PURCHASE AGREEMENT AMONG
THE CORPORATION, THE CITY AND GEORGE K. BAUM &
COMPANY AND A FINANCIAL GUARANTY AGREEMENT
BETWEEN THE CITY AND THE CERTIFICATE INSURER
AND APPROVING A TRUST INDENTURE BETWEEN THE
CORPORATION AND THE TRUSTEE, A LEASEHOLD DEED
OF TRUST FROM THE CORPORATION TO THE PUBLIC
TRUSTEE OF LARIM[ER COUNTY FOR THE BENEFIT OF
THE TRUSTEE AND A PRELIMINARY OFFICIAL
STATEMENT AND A FINAL OFFICIAL STATEMENT
RELATING TO CERTAIN LEASE CERTIFICATES OF
PARTICIPATION, SERIES 2004A.
WHEREAS, the City of Fort Collins, Colorado (the "City"), has need for and desires to
provide certain real and personal property for City purposes; and
WHEREAS, the City is authorized by Colo. Const. art. XX, §6, Chapter 23, Article IV,
Division 2 of the Code of the City of Fort Collins (the "City Code") and part 7 of article 15 of
title 31, Colorado Revised Statutes, as amended, to lease City property as lessor; and
WHEREAS, the City is authorized by Colo. Const. art. XX, §6 and part 8 of article 15 of
title 31, Colorado Revised Statutes, as amended, to enter into rental or leasehold agreements in
order to provide necessary land, buildings, equipment and other property for governmental or
proprietary purposes, and such agreements may include options to purchase and acquire title to
such leased or rented property; and
WHEREAS, Fort Collins Capital Leasing Corporation, a Colorado nonprofit corporation
(the "Corporation"), has offered to lease certain real property (the "Site") from the City pursuant
to a Site Agreement, dated its delivery date (the "Site Agreement"), between the City, as lessor,
and the Corporation, as lessee, and to lease the Site and the improvements and equipment to be
acquired, constructed and installed thereon (the 'Improvements") to the City under a Lease
Agreement, dated its delivery date (the "Lease"), between the Corporation, as lessor, and the
City, as lessee; and
WHEREAS, the Corporation proposes to acquire its interest in the Site and to acquire,
construct and install the Improvements for lease to the City with the proceeds of Lease
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Certificates of Participation, Series 2004A, dated their delivery date, in the aggregate principal
amount of$31,815,000 (the "Series 2004A Certificates")evidencing assignments of
proportionate interests in its right to receive rental payments and certain other revenues under the
Lease; and
WHEREAS, in order to provide security for the payment of the principal of and interest
on the Series 2004A Certificates, the Corporation proposes to assign its interest in the Site and
the Improvements (collectively, the "Leased Property") and its right to receive rental payments
and certain other revenues under the Lease to a national banking association selected by the
Corporation, as trustee (the "Trustee"), under a Trust Indenture, dated its delivery date (the
"Indenture"), between the Corporation, as grantor, and the Trustee, as trustee, and a Leasehold
Deed of Trust, Security Agreement and Financing Statement, dated its delivery date (the "Deed
of Trust"), between the Corporation, as grantor, and the Public Trustee of Larimer County, as
grantee, for the benefit of the Trustee, as beneficiary; and
WHEREAS, a municipal bond insurer selected by the Corporation and the City (the
"Certificate Insurer") has offered to provide a surety bond in lieu of a cash reserve otherwise
required as security for the Series 2004A Certificates pursuant to a Financial Guaranty
Agreement, dated its delivery date (the "Financial Guaranty Agreement"), between the City and
the Certificate Insurer; and
WHEREAS, neither the Lease nor the Financial Guaranty Agreement constitutes a
"multiple-fiscal year direct or indirect debt or other financial obligation" of the City within the
meaning of Colo. Const. art. X, §20(4)(b) and may therefore be entered into without voter
approval in advance; and
WHEREAS, George K. Baum &Company(the "Underwriter") has offered to purchase
the Series 2004A Certificates pursuant to a Certificate Purchase Agreement, dated its execution
date (the "Purchase Agreement"), among the Corporation, the City and the Underwriter; and
WHEREAS the forms of the Site Agreement, the Lease, the Indenture, the Deed of Trust,
the Financial Guaranty Agreement, the Purchase Agreement and the Preliminary Official
Statement relating to the Series 2004A Certificates (the "Preliminary Official Statement") have
been filed with the City Clerk.
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS,
COLORADO:
1. The forms of the Site Agreement, the Lease, the Indenture, the Deed of
Trust, the Financial Guaranty Agreement and the Purchase Agreement are hereby approved,
together with any revisions thereto as may be considered necessary or desirable by the Financial
Officer in consultation with the City Attorney. The preparation and use of the Preliminary
Official Statement is in all respects hereby ratified, approved and confirmed. The City is
authorized to prepare or cause to be prepared a final Official Statement (the "Official
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Statement") in connection with the offering and sale of the Series 2004A Certificates. The
Mayor is authorized to execute and deliver the Official Statement, and the execution of the
Official Statement by the Mayor shall be conclusively deemed to evidence the approval of the
form and contents thereof by the City.
2. The City Council (the "Council") hereby finds that the execution of the
Site Agreement and the Lease and the lease of the Leased Property as provided therein is in the
best interests of the City and its inhabitants. In addition, the determinations set forth in Section
6.5 of the Lease are incorporated herein by this reference as if set forth in full herein.
3. The Mayor and the City Clerk are hereby authorized and directed to
execute the Site Agreement, the Lease, the Financial Guaranty Agreement and any other
documents or certificates that, in the opinion of the City Attorney, are necessary to effect the
transactions contemplated thereby and not inconsistent therewith. The City Manager is hereby
authorized to accept and execute the Purchase Agreement on behalf of the City immediately
following the marketing of the Series 2004A Certificates and prior to final adoption of this
Ordinance, but the Purchase Agreement shall not become effective according to the terms
thereof until the effective date of this Ordinance.
4. The City hereby waives any available defense of governmental immunity
from liability in tort for any failure to surrender possession of the Leased Property as provided in
the Lease.
5. The Council hereby authorizes the amendment of the Site Agreement and
the Lease, and consents to the amendment of the Indenture and the Deed of Trust, to revise the
definitions of "Site" and "Leased Property" as provided in the Site Agreement, the Lease, the
Indenture and the Deed of Trust.
6. If any section, paragraph, clause or provision of this Ordinance shall for
any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such
section, paragraph, clause or provision shall not affect any of the remaining provisions of this
Ordinance.
7. All action not inconsistent with the provisions of this Ordinance
heretofore taken by the City or its officers, and otherwise by the City directed toward the
completion of the transactions described herein is hereby ratified, approved and confirmed.
8. All ordinances, resolutions and orders, or parts thereof, of the City
inconsistent herewith and with the documents approved hereby are hereby repealed to the extent
only of such inconsistency. This repealer shall not be construed as reviving any ordinance,
resolution or order, or part thereof.
9. Any inconsistency between the provisions of this Ordinance and those of
any applicable statute, including parts 7 and 8 of article 15 of title 31, Colorado Revised Statutes,
as amended, is intended by the Council. To the extent of any such inconsistency the provisions
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of this Ordinance shall be deemed made pursuant to Colo. Const. art. XX, §6 and shall supersede
to the extent permitted by law any such conflicting provisions.
Introduced, considered favorably on first reading, and ordered published by number and
title only, this 15th day of June, A.D. 2004, and presented for final passage on the 6th day of
July, A.D. 2004.
Mayor
ATTEST:
City Clerk
Passed and adopted on final reading this 6th day of July, A. D. 2004.
Mayor
ATTEST:
City Clerk
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