HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 11/19/2002 - ITEMS RELATING TO THE ISSUANCE OF CITY OF FORT COL WNW
AGENDA ITEM SUMMARY ITEM NUMBER: 17 A-B
DATE: November 19, 2002
FORT C LLINS CITY COUNCIL STAFF:
Alan Krcmarik
SUBJECT:
Items Relating to the Issuance of City of Fort Collins Downtown Development AUthorl[\
Subordinate Tax Increment Revenue Bonds, Series 2002.
RECOMMENDATIO :
The DDA Boa d of Directors and staff recommend adoption of the Ordinances on First Reading.
FINANCIAL IMPACT:
At the end of 2001, the Downtown Development Authority Debt Service Fund held
approximately $1,370,000 of unreserved fund balance. By the end of 2002, the unreserved fund
balance is projected to be approximately $1,356,000. The DDA Board and staff recommend
using $1,065,COO of the unreserved fund balance to make capital improvements in the downtown
area consisten with the mission of the DDA. The DDA debt service fund will have sufficient
revenue to meet all required debt service payments and reserve requirements for 2002 through
2006.
EXECUTIVE SUMMARY:
A. First Reading of Ordinance No. 174, 2002, Authorizing the Issuance of City of Fort
Collin Downtown Development Authority Taxable Subordinate Tax Increment Revenue
Bonds Series 2002 in the Amount of $1,065,000 for the Purpose of Financing Certain
Capita Improvements and Capital Projects.
B. First Reading of Ordinance No. 175, 2002, Appropriating Proceeds from the Issuance of
City o Fort Collins, Colorado, Downtown Development Authority Taxable Subordinate
Tax rement Revenue Bonds, Series 2002, for the Purpose of Making Certain Capital
Improvements in the Downtown Area of Fort Collins and Appropriating Revenues in the
Tax Increment Fund.
i
The City of Fort Collins created the Downtown Development Authority ("DDA") to make
desired improvements in the downtown area. Through tax increment financing, the DDA has
made significant contributions to the redevelopment and improvement of the downtown area.
These two O dinances provide $1,065,000 of funding from the unreserved fund balance in the
DDA Debt Service Fund to make additional improvements and contribute to City projects in the
downtown area. The first ordinance authorizes the issuance of short term bonds for the projects
Novermae
DATE: r ITEM NUMBER:
which will be paid from the tax increment revenue. The second ordinance appropriates the
proceeds in the Capital Projects Fund for the various projects.
BACKGROUND:
The projects include:
231 North College $ 50,000
Chamber of Commerce 52,000
Mason Street North 251,000
Old Town Square Play Area 12,000
Museum 25,000
Linden Street Plan 250,000
Mulberry-Lemay 85,250
River Design 15,000
Linden Loan 100,000
Downtown Strategic Plan 56,250
300 East Mountain 90,000
Baptist Church 64,000
$1,050,500
231 North College—Rehabilitation of this property to include a new stone fagade and removal of
the billboards on top of the building.
Chamber of Commerce Building--complete redevelopment of the Chamber of Commerce
building.
Mason Street North—mixed use housing and commercial project next to Lee Martinez Park.
Old Town Square Play Area—an interactive collection of sculptures that children can climb
upon.
Museum—compete reconstruction of the approach and entry to the Fort Collins Museum
Linden Street Plan—Designing an Overall Development Plan for the Linden Street
Neighborhood including all due diligence.
Mulberry-Lemay Intersection—reimbursement payment to the City of Fort Collins for
improvements made to the Mulberry-Lemay Intersection.
River Design—Reimbursement payment to the City of Fort Collins for design work along the
Poudre River.
Linden Loan—retiring the balance of a loan made by the City of Fort Collins Street Oversizing
fund to the Downtown Development Authority.
Downtown Strategic Plan—reimbursement payment to the City of Fort Collins for the
development of a Downtown Strategic Plan.
300 East Mountain—redevelopment of this single story structure into two and stories of mixed
use residential and commercial uses.
ovem er
ATE:
ITEM NUMBER:
D
Baptist Church Complete rehabilitation of this historic structure located at the Northeast corner
of Remington a d Magnolia Streets.
The
i remaining amount ($14,500) is available to cover costs of issuing the bonds. Staff is
negotiating with a few banks to determine who the purchaser will be, the name of the purchaser
will be inserted on Second Reading. All of these projects have been reviewed and recommended
by the Board of Directors of the DDA.
ORDINANCE NO. 174, 2002
AN ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF FORT
COLLINS, COLORADO, DOWNTOWN DEVELOPMENT AUTHORITY
TAXABLE SUBORDINATE TAX INCREMENT REVENUE BONDS, SERIES
2002, DATED THEIR DELIVERY DATE, IN THE AGGREGATE PRINCIPAL
AMOUNT OF $1,065,000 FOR THE PURPOSE OF FINANCING CERTAIN
CAPITAL IMPROVEMENTS AND CAPITAL PROJECTS; AND PROVIDING
FOR THE PLEDGE OF CERTAIN INCREMENTAL AD VALOREM TAX
REVENUES TO PAY THE PRINCIPAL OF, INTEREST ON AND ANY
PREMIUM DUE IN CONNECTION WITH THE REDEMPTION OF THE
BONDS.
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS,
COLORADO, THAT:
Section 1. Definitions and Construction.
A. Definitions. In this Ordinance the following terms have the following
respective meanings unless the context hereof clearly requires otherwise:
(1) Additional Parity Bonds: any Parity Securities issued after the
issuance of the Bonds.
(2) Authority: the City of Fort Collins, Colorado, Downtown
Development Authority.
(3) Average Annual Debt Service Requirements: the aggregate of all Debt
Service Requirements (excluding any redemption premiums) due on the Bonds or any
other issue of Parity Securities for all Bond Years beginning with the Bond Year in
which Debt Service Requirements of the Bonds or such Parity Securities are first payable
and ending with the Bond Year in which the last of the Debt Service Requirements are
payable, divided by the number of such years.
(4) Bond Year: the twelve (12) months commencing on the second day of
December of any calendar year and ending on the first day of December of the next
succeeding calendar year.
(5) Bonds: the City of Fort Collins, Colorado, Downtown Development
Authority Taxable Subordinate Tax Increment Revenue Bonds, Series 2002, dated their
delivery date, in the aggregate principal amount of$1,065,000.
(6) Charter: the Home Rule Charter of the City, as amended.
(7) City: the City of Fort Collins, Colorado.
(8) Combined Average Annual Debt Service Requirements: the sum of
the Average Annual Debt Service Requirements for all issues of Parity Securities for
which the computation is being made.
1
(9) Commercial Bank: a state or national bank or trust company which is
a member of the Federal Deposit Insurance Corporation and of the Federal Reserve
System, which has a combined capital and surplus of $3,000,000 or more, and which is
located within the United States of America.
(10) Cost of the Project: all or any part of the cost of acquiring.
constructing and installing the Project; all surveying, inspection, fiscal, and legal
expenses; all costs of issuing the Bonds; any discount on the sale of the Bonds; costs of
financial, professional, and other estimates and advice; reimbursements of amounts
advanced for any of the foregoing; repayment of any interim loans or interfund
borrowings; capitalized interest on the Bonds; contingencies; reserves for payment of the
principal of or interest on the Bonds; and all such other costs as may be necessary or
incidental to the acquisition, construction and installation of the Project or any part
thereof.
(11) Council: the governing body of the City.
(12) Debt Service Requirements: the principal of, interest on and any
premium due in connection with the redemption of the Bonds, any Additional Parity
Bonds, any Parity Securities or any other securities payable from the Tax Increment
Revenues.
(13) Development and Expense Fund: the special fund created in
Ordinance No. 142, 1985, of the City, designated therein as the "Development Account"
of the "City of Fort Collins, Colorado, Downtown Development Authority Tax Increment
Bonds, Bond Fund" and referred to in Section 5A hereof.
(14) District: the area referred to in the Plan of Development and
described in Ordinance No. 46, 1981, of the City, as amended by Ordinance No. 162,
1981, of the City and Ordinance No. 2, 1983, of the City.
(15) Downtown Development Authority Act: part 8 of article 25 of
title 31, Colorado Revised Statutes, as amended.
(16) Event of Default: one of the events described in Section 10A
hereof.
(17) Federal Securities: bills, certificates of indebtedness, notes, bonds
or similar securities which are direct obligations of the United States of America or are
obligations the principal and interest of which are unconditionally guaranteed by the
United States of America.
(18) Fiscal Year: the twelve (12) months commencing on the first day
of January of any calendar year and ending on the last day of December of such calendar
year or such other twelve-month period as may from time to time be designated by the
Council as the Fiscal Year of the City.
(19) Interest Payment Date: a date designated by ordinance for the
payment of interest on the Bonds or any other designated security.
2
(20) Investment Earnings: all income derived from the investment of
any proceeds of the Bonds deposited in the Development and Expense Fund or the
Subordinate Bonds Debt Service Account.
(21) Investment Letter: the investment letter to be executed by the
Purchaser and each subsequent Owner of the Bonds upon purchase thereof.
(22) Maturity Date: a date designated by ordinance for the payment of
principal of the Bonds or any other designated security.
(23) 1983 Tax Increment Revenue Bond Anticipation Notes: the City
of Fort Collins, Colorado, Downtown Development Authority Tax Increment Bond
Anticipation Notes, Series April 1, 1983, dated April 1, 1983, in the aggregate principal
amount of$3,100,000.
(24) 1984 Tax Increment Revenue Bonds: the City of Fort Collins,
Colorado, Downtown Development Authority Tax Increment Bonds, Series 1984A, dated
October 1, 1984, in the aggregate principal amount of$8,200,000.
(25) 1985 Tax Increment Revenue Refunding Bonds: the City of Fort
Collins, Colorado, Downtown Development Authority Tax Increment Refunding Bonds,
Series 1985A, dated November 1, 1985, in the original aggregate principal amount of
$8,885,000.
(26) 1988 Tax Increment Revenue Refunding and Improvement Bonds:
the City of Fort Collins, Colorado, Downtown Development Authority Tax Increment
Revenue Refunding and Improvement Bonds, Series 1988, dated May 15, 1988, in the
aggregate principal amount of$13,545,000.
(27) 1992 Tax Increment Revenue Refunding Bonds: the City of Fort
Collins, Colorado, Downtown Development Authority Tax Increment Revenue
Refunding Bonds, Series 1992, dated March 15, 1992, in the aggregate principal amount
of$11,380,000.
(28) 1998 Tax Increment Revenue Bonds: the City of Fort Collins,
Colorado, Downtown Development Authority Taxable Subordinate Tax Increment
Revenue Bonds, Series 1998, dated July 1, 1998, in the aggregate amount of$190,000.
(29) 1999 Tax Increment Revenue Bonds: the City of Fort Collins,
Colorado, Downtown Development Authority Taxable Subordinate Tax Increment
Revenue Bonds, Series 1999, dated November 1, 1999, in the aggregate principal amount
of$750,000.
(30) Ordinance: this Ordinance No. 174, 2002, of the City.
(31) Outstanding or outstanding: as of any particular date, all Bonds,
Additional Parity Bonds, Parity Securities, Superior Bonds or any such other securities
payable in whole or in part from the Tax Increment Revenues that have been authorized,
executed and delivered, except the following:
3
(a) Any Bond, Additional Parity Bond, Parity Security, Superior
Bond or other security cancelled by the City, by the Paying Agent or otherwise on
behalf of the City on or before such date;
(b) Any Bond, Additional Parity Bond, Parity Security, Superior
Bond or other security held by or on behalf of the City;
(c) Any Bond, Additional Parity Bond, Parity Security, Superior
Bond or other security of the City for the payment or the redemption of which
moneys or Federal Securities sufficient (including the known minimum yield
available for such purpose from Federal Securities in which such amount wholly
or in part may be initially invested) to meet all of the Debt Service Requirements
of such Bond, Additional Parity Bond, Parity Security, Superior Bond or other
security to the Maturity Date or specified Redemption Date thereof shall have
theretofore been deposited in escrow or in trust with a Trust Bank for that
purpose; and
(d) Any lost, destroyed, or wrongfully taken Bond, Additional
Parity Bond, Parity Security, Superior Bond or other security of the City in lieu of
or in substitution for which another bond or other security shall have been
executed and delivered.
(32) Owner: the holder of any bearer instrument or registered owner of
any registered instrument.
(33) Parity Securities: bonds, warrants, notes, securities, leases or other
contracts evidencing borrowings and payable from the Tax Increment Revenues equally
or on a parity with the Bonds.
(34) Paying Agent: the Financial Officer of the City, or his successors.
(35) Permitted Investments: all securities or deposits authorized by
ordinances of the City and, to the extent applicable, the laws of the State.
(36) Person: any individual, firm, partnership, corporation, company,
association, joint-stock association, or body politic or any trustee, receiver, assignee, or
other similar representative thereof.
(37) Plan of Development: the plan approved by Resolution 81-129 of
the City.
(38) Pledged Revenues: the Tax Increment Revenues and the
Investment Earnings.
(39) Project: the capital improvements or capital projects described in
the Plan financed with the proceeds of the Bonds.
(40) Property Tax Base Dates: September 15, 1980, with respect to the
District described in Ordinance No. 46, 1981, of the City; September 15, 1981, with
4
respect to the area added to the District by Ordinance No. 162, 1981, of the City;
September 15, 1982, with respect to the area added to the District by Ordinance No. 2,
1983, of the City; and the applicable dates pursuant to the Downtown Development
Authority Act with respect to such areas as may hereafter be added to the District by
appropriate legislative action of the City.
(41) Purchaser: (To be determined)
(42) Redemption Date: the date fixed for the redemption prior to
maturity of any Bonds or other designated securities payable from the Tax Increment
Revenues in any notice of prior redemption given by or on behalf of the City.
(43) Registrar: the Financial Officer of the City, or his successors.
(44) Security or securities: any bond issued by the City or any other
evidence of the advancement of money to the City.
(45) Special Record Date: the date fixed by the Paying Agent for the
determination of ownership of Bonds for the purpose of paying interest not paid when
due or interest accruing after maturity.
(46) State: the State of Colorado.
. (47) Subordinate Bonds Debt Service Account: the special fund
created in Ordinance No. 101, 1998, of the City designated therein as the "City of Fort
Collins, Colorado, Downtown Development Authority Subordinate Tax Increment Bonds
Debt Service Account" and referred to in Section 5F hereof.
(48) Superior Bonds or Superior Securities: the 1992 Tax Increment
Refunding Bonds, the 2001 Tax Increment Revenue Refunding Bonds and any other
bonds or securities payable from the Tax Increment Revenues having a lien thereon
superior or senior to the lien thereon of the Bonds.
(49) Tax Increment Fund: the special fund created in Ordinance No.
142, 1985, of the City designated therein as the "City of Fort Collins, Colorado,
Downtown Development Authority Tax Increment Bonds, Bond Fund' and referred to in
Section 5B hereof.
(50) Tax Increment Principal and Interest Account: the special fund
created in Ordinance No. 142, 1985, of the City, designated therein as the 'Principal and
Interest Account" of the "City of Fort Collins, Colorado, Downtown Development
Authority Tax Increment Bonds, Bond Fund' and referred to in Section 5C hereof.
(51) Tax Increment Reserve Account: the special fund created in
Ordinance No. 142, 1985, of the City, designated therein as the "City of Fort Collins,
Colorado, Tax Increment Bonds, Reserve Fund' and referred to in Section 5D hereof.
. (52) Tax Increment Revenues: all revenues derived in each Fiscal Year
from the levy of ad valorem taxes at the rate fixed each year by or for each public body
5
having taxing power over all or any portion of the District upon that portion of the
valuation for assessment of all taxable property within the District and the boundaries of
such public body which is in excess of the valuation for assessment of all taxable
property within the District and the boundaries of such public body on the Property Tax
Base Dates, all in accordance with Section 31-25-807(3)(a)(11) of the Downtown
Development Authority Act, less any collection fees lawfully payable to the City or
Larimer County, Colorado, for services rendered in connection with the collection of
such ad valorem taxes; provided, that in the event of a general reassessment of taxable
property in the City, the valuation for assessment of taxable property within the District
on the Property Tax Base Dates will be proportionately adjusted as required by the
Downtown Development Authority Act or other applicable law.
(53) Transfer Agent: the Financial Officer of the City, or his
successors.
(54) Trust Bank: a Commercial Bank which has a combined capital
and surplus of$25,000,000 or more and which is authorized to exercise and is exercising
trust powers.
(55) 2000 Tax Increment Revenue Bonds: the City of Fort Collins,
Colorado, Downtown Development Authority Subordinate Tax Increment Revenue
Bonds, Series 2000A, dated March 1, 2000, in the aggregate principal amount of
$608,000.
(56) 2001 Tax Increment Revenue Refunding Bonds: the City of Fort
Collins, Colorado, Downtown Development Authority Tax Increment Revenue
Refunding Bonds, Series 2001, dated April 1, 2001, in the aggregate principal amount of
$3,640,000.
B. Construction. This Ordinance, except where the context by clear implication
herein otherwise requires, shall be construed as follows:
(1) Words in the singular number include the plural, and words in the
plural include the singular.
(2) Words in the masculine gender include the feminine and the neuter,
and when the sense so indicates words of the neuter gender refer to any gender.
(3) Articles, sections, subsections, paragraphs and subparagraphs
mentioned by number, letter or otherwise correspond to the respective articles, sections,
subsections, paragraphs and subparagraphs of this Ordinance so numbered or otherwise
so designated.
(4) The titles and headlines applied to articles, sections and subsections of
this Ordinance are inserted only as a matter of convenience and ease in reference and in
no way define or limit the scope or intent of any provisions of this Ordinance.
(5) Any inconsistency between the provisions of this Ordinance and those
of the Downtown Development Authority Act is intended by the Council. To the extent
6
• of any such inconsistency the provisions of this Ordinance shall be deemed made
pursuant to the Charter and shall supersede to the extent permitted by law the conflicting
provisions of the Downtown Development Authority Act.
Section 2. Recitals.
A. Establishment of Authority and Approval of Plan of Development. Pursuant
to Ordinance No. 46, 1981, the City has heretofore established the Authority. Pursuant to
Resolution 81 129 the City has heretofore approved the Plan of Development. The Plan of
Development so approved contained a provision for division of taxes as authorized by the
Downtown Development Authority Act effective for twenty-five years beginning September 8.
1981.
B. Special Election and Canvass of Returns. At a special election held in the
City on Tuesday, June 1, 1982, in accordance with law and pursuant to due notice there was
submitted to the qualified electors of the District the following question:
Shall the City of Fort Collins issue bonds or otherwise provide for loans,
advances or indebtedness from time to time in an amount not to exceed
$25,000,000 at a maximum net effective interest rate not to exceed 18 per centum
per annum, the use of which shall be to finance capital improvements and capital
projects within the parameters of the Plan of Development of the Fort Collins
Downtown Development Authority, and irrevocably pledge the special fund into
which all of that portion of property taxes in excess of such taxes which are
produced by the levy at the rate fixed each year by or for any public body upon
the valuation for assessment of taxable property within the boundaries of the
District last certified prior to the effective date of approval by the Fort Collins
City Council of the Plan of Development of the Downtown Development
Authority or, as to an area later added to the boundaries of the District, the
effective date of the modification of the Plan of Development from which special
fund shall be paid the principal of, the interest on, and any premiums due in
connection with the bonds of, loans or advances to, or indebtedness incurred by,
whether funded, refunded, assumed, or otherwise, the City of Fort Collins for
financing or refinancing, in whole or in part, development projects within the
boundaries of the Plan for Development area.
As evidenced by the canvass of the returns of said election and the Statement and Certificate of
Determination of Result thereof made by the Board of Elections of the City on June 4, 1982, a
majority of said electors voted affirmatively on said question.
C. Prior Bonds. Pursuant to the authority so conferred at said election the City
has heretofore issued and sold the 1983 Tax Increment Revenue Bond Anticipation Notes in
order to finance capital improvements and capital projects as provided in the Plan of
Development. Pursuant to the authority so conferred at said election the City has heretofore
issued and sold the 1984 Tax Increment Revenue Bonds in order to refund, pay and discharge
the 1983 Tax Increment Revenue Bond Anticipation Notes and finance capital improvements
and capital projects as provided in the Plan of Development. Pursuant to the authority so
conferred at said election the City has heretofore issued and sold the 1985 Tax Increment
7
Revenue Refunding Bonds in order to refund, pay and discharge the 1984 Tax Increment
Revenue Bonds. Pursuant to the authority so conferred at said election the City has heretofore
issued and sold the 1988 Tax Increment Revenue Refunding and Improvement Bonds in order to
refund, pay and discharge the 1985 Tax Increment Revenue Refunding Bonds and finance
capital improvements and capital projects as provided in the Plan of Development. Pursuant to
the authority so conferred at said election the City has heretofore issued and sold the 1992 Tax
Increment Revenue Refunding Bonds in order to refund, pay and discharge the 1988 Tax
Increment Revenue Refunding and Improvement Bonds. The City has heretofore issued and
sold the 1998 Tax Increment Revenue Bonds in order to finance capital improvements and
capital projects as provided in the Plan of Development. The City has heretofore issued and sold
the 1999 Tax Increment Revenue Bonds in order to finance capital improvements and capital
projects as provided in the Plan of Development. Pursuant to the authority so conferred at said
election the City has heretofore issued and sold the 2000 Tax Increment Revenue Bonds in order
to finance capital improvements and capital projects as provided in the Plan of Development.
Pursuant to the authority so conferred at said election the City has heretofore issued and sold the
2001 Tax Increment Revenue Refunding Bonds in order to refund, pay and discharge a portion
of the 1992 Tax Increment Revenue Refunding Bonds.
D. Project. The City has need for and desires to acquire, construct, install and
finance the Project.
E. Authority. Pursuant to art. XX, §6 of the Colorado Constitution, Art. V,
Section 19.8 of the Charter and the Downtown Development Authority Act, the City is
authorized by Council action and without an election to issue the Bonds.
Section 3. The Bonds.
A. Authorization. The Bonds are hereby authorized to be issued for the purpose
of financing the Project.
B. Bond Details.
(1) Generally. The Bonds shall be issuable in fully registered form in the
denomination of$100,000 or any integral multiple of$5,000 in excess of thereof.
The Bonds shall mature on December 31, 2002, and shall bear interest
from their delivery date to their Maturity Date, except if redeemed prior thereto, at the
rate of (to be determined)_ % per annum. Said interest shall be payable on their
Maturity Date. If upon presentation at maturity the principal of any Bond is not paid as
provided herein, interest shall continue thereon at the same interest rate until the principal
is paid in full.
The Debt Service Requirements of the Bonds shall be payable in lawful
money of the United States of America to the Owners of the Bonds by the Paying Agent.
The principal and interest shall be payable to the Owner of each Bond upon presentation
and surrender thereof at maturity or upon prior redemption, by check or draft mailed to
such Owner at the address appearing on the registration books of the City maintained by
the Registrar or by wire transfer to such bank or other depository as the Owner shall
8
designate in writing to the Paying Agent. Any interest not paid when due and any
interest accruing after maturity shall be payable to the Owner of each Bond entitled to
receive such interest determined as of the close of business on the Special Record Date.
irrespective of any transfer of ownership of the Bond subsequent to the Special Record
Date and prior to the date fixed by the Paying Agent for the payment of such interest, by
check or draft or wire transfer directed to such Owner as aforesaid. Notice of the Special
Record Date and of the date fixed for the payment of such interest shall be given by
sending a copy thereof by certified or registered first-class, postage prepaid mail, at least
fifteen (15) days prior to the Special Record Date, to the Owner of each Bond upon
which interest will be paid determined as of the close of business on the day preceding
such mailing at the address appearing on the registration books of the City. Any
premium shall be payable to the Owner of each Bond redeemed upon presentation and
surrender thereof upon prior redemption, by check or draft or wire transfer directed to
such Owner as aforesaid. If the date for making or giving any payment, determination or
notice described herein is a Saturday, Sunday, legal holiday or any other day on which
the office of the Paying Agent or Registrar is authorized or required by law to remain
closed, such payment, determination or notice shall be made or given on the next
succeeding day which is not a Saturday, Sunday, legal holiday or other day on which the
office of the Paying Agent or Registrar is authorized or required by law to remain closed.
(2) Redemption. The Bonds shall be subject to optional redemption, in
whole or in part, at any time prior to their Maturity Date at a price equal to the principal
. amount of each Bond so redeemed plus accrued interest thereon to the Redemption Date.
The Bonds may be redeemed in part if issued in denominations which are
integral multiples of$5,000. Such Bonds shall be treated as representing a corresponding
number of separate Bonds in the denomination of $5,000 each. Any such Bond to be
redeemed in part shall be surrendered for partial redemption in the manner hereinafter
provided for transfers of ownership. Upon payment of the redemption price of any such
Bond redeemed in part the Owner thereof shall receive a new Bond or Bonds of
authorized denominations in aggregate principal amount equal to the unredeemed portion
of the Bond surrendered.
Unless waived by the Owners of any Bonds to be redeemed, notice of
redemption shall be given by the Paying Agent in the name of the City by sending a copy
thereof by certified or registered first-class postage prepaid mail, not less than three (3)
days prior to the Redemption Date, to the Owner of each of the Bonds being redeemed
determined as of the close of business on the day preceding the first mailing of such
notice at the address appearing on the registration books of the City. Such notice shall
specify the number or numbers of the Bonds to be redeemed, whether in whole or in part,
the principal amounts thereof and the date fixed for redemption and shall further state
that on the Redemption Date there will be due and payable upon each Bond or part
thereof so to be redeemed the principal amount or part thereof plus accrued interest
thereon to the redemption date plus any premium due and that from and after such date
interest will cease to accrue. Bonds called for optional redemption as provided herein
shall be redeemable only to the extent of moneys on deposit with the Paying Agent and
legally available for redemption of Bonds on the date of such notice. Failure to mail any
notice as aforesaid or any defect in any notice so mailed with respect to any Bond shall
9
not affect the validity of the redemption proceedings with respect to any other Bond.
Any Bonds redeemed prior to their Maturity Date by call for prior redemption or
otherwise shall not be reissued and shall be cancelled the same as Bonds paid at or after
maturity.
(3) Interest Rates. The maximum net effective interest take for the Bonds
is 18% per annum. The actual net effective interest rate for the Bonds is (to be
determined)_% per annum.
(4) Execution and Authentication. The Bonds shall be executed by and on
behalf of the City with the facsimile or manual signature of the Mayor, shall bear a
facsimile or manual impression of the seal of the City, shall be attested with the facsimile
or manual signature of the City Clerk, shall be countersigned with the facsimile or
manual signature of the Financial Officer of the City, and shall be authenticated with the
manual signature of the Registrar. Should any officer whose facsimile or manual
signature appears on the Bonds cease to be such officer before delivery of the Bonds to
the Purchaser, such facsimile or manual signature shall nevertheless be valid and
sufficient for all purposes. No Bond shall be valid or become obligatory for any purpose
or be entitled to any security or benefit under this Ordinance unless and until the
certificate of authentication on such Bond shall have been duly executed by the Registrar,
and such executed certificate upon any such Bond shall be conclusive evidence that such
Bond has been authenticated and delivered under this Ordinance.
(5) Registration, Transfer and Exchange. Upon their execution and
authentication and prior to their delivery the Bonds shall be registered for the purpose of
payment of principal and interest by the Registrar. Thereafter, the Bonds shall be
transferable only upon the registration books of the City by the Transfer Agent at the
request of the Owner thereof or his, her or its duly authorized attorney-in-fact or legal
representative. The Registrar or Transfer Agent shall accept a Bond for registration or
transfer only if the Owner is to be an individual, a corporation, a partnership, or a trust.
A Bond may be transferred upon surrender thereof together with a written instrument of
transfer duly executed by the Owner or his, her or its duly authorized attorney-in-fact or
legal representative with guaranty of signature satisfactory to the Transfer Agent,
containing written instructions as to the details of the transfer, along with the social
security number or federal employer identification number of the transferee and, if the
transferee is a trust, the names and social security numbers of the settlors and the
beneficiaries of the trust. The Transfer Agent shall not be required to transfer ownership
of any Bond during the fifteen (15) days prior to the first mailing of any notice of
redemption or to transfer ownership of any Bond selected for redemption on or after the
date of such mailing. The Owner of any Bond or Bonds may also exchange such Bond or
Bonds for another Bond or Bonds of authorized denominations. Transfers and exchanges
shall be made without charge, except that the Transfer Agent may require payment of a
sum sufficient to defray any tax or other governmental charge that may hereafter be
imposed in connection with any transfer or exchange of Bonds. No transfer of any Bond
shall be effective until entered on the registration books of the City. In the case of every
transfer or exchange, the Transfer Agent shall deliver to the new Owner a new Bond or
Bonds of the same aggregate principal amount, maturing in the same year, and bearing
interest at the same per annum interest rate as the Bond or Bonds surrendered. Such
10
Bond or Bonds shall be dated as of their date of authentication. New Bonds delivered
upon any transfer or exchange shall be valid obligations of the City, evidencing the same
obligation as the Bonds surrendered, shall be secured by this Ordinance, and shall be
entitled to all of the security and benefits hereof to the same extent as the Bonds
surrendered. The City may deem and treat the Person in whose name any Bond is last
registered upon the books of the City as the absolute owner thereof for the purpose of
receiving payment of the Debt Service Requirements of such Bond and for all other
purposes, and all such payments so made to such Person or upon his, her or its order shall
be valid and effective to satisfy and discharge the liability of the City upon such Bond to
the extent of the sum or sums so paid, and the City shall not be affected by any notice to
the contrary.
(6) Replacement of Bonds. If any Bond shall have been lost, destroyed or
wrongfully taken, the City shall provide for the replacement thereof in the manner set
forth and upon receipt of the evidence, indemnity bond and reimbursement for expenses
provided in Ordinance No. 80, 1984.
(7) Recitals in Bonds. Each Bond shall recite in substance that the Bond
is payable solely from the Pledged Revenues and the funds and accounts hereby pledged
and that the Bond is not a debt or an indebtedness or a multiple-fiscal year financial
obligation of the City and that the Bond is not a general obligation of the City and that
the full faith and credit of the City is not pledged to pay the Debt Service Requirements
of such Bond. Each Bond shall further recite that it is issued under the authority of the
Constitution of the State of Colorado, the Charter, the Downtown Development
Authority Act and this Ordinance.
(8) Form of Bonds. The Bonds shall be in substantially the following
form:
(Form of Bond]
UNITED STATES OF AMERICA
STATE OF COLORADOCOUNTY OF LARIMER
CITY OF FORT COLLINS
DOWNTOWN DEVELOPMENT AUTHORITY
TAXABLE SUBORDINATE TAX INCREMENT REVENUE BOND
SERIES 2002
No. R-_ $
Interest Rate Maturity Date Original Date
% December 31, 2002 December 30, 2002
11
REGISTERED OWNER:
PRINCIPAL SUM:
The City of Fort Collins, in the County of Larimer and State of Colorado, for
value received, hereby promises to pay to the Registered Owner (specified above), or registered
assigns, solely from the special fund and account provided therefor, as hereinafter set forth, the
Principal Sum (specified above), in lawful money of the United States of America, on the
Maturity Date (specified above), with interest thereon from the Original Date (specified above)
to the Maturity Date, except if redeemed prior thereto, at the per anmtm Interest Rate (specified
above), payable on the Maturity Date, in the manner provided herein. If upon presentation at
maturity payment of the Principal Sum of this Bond is not made as provided herein, interest
continues at the Interest Rate until the Principal Sum is paid in full.
The Bonds are subject to optional redemption prior to their maturity date, in
whole or in part, at any time prior to maturity at a price equal to the principal amount of each
Bond so redeemed plus accrued interest thereon to the redemption date.
Bonds that are redeemable prior to their maturity date may be redeemed in part if
issued in denominations that are integral multiples of $5,000. In such case the Bond is to be
surrendered in the manner provided for transfers of ownership. Upon payment of the redemption
price the Registered Owner is to receive a new Bond or Bonds of authorized denominations in
aggregate principal amount equal to the unredeemed portion of the Bond surrendered.
Unless waived by the registered owners of the Bonds to be redeemed, notice of
redemption of any Bonds is to be given by the paying agent in the name of the City by sending a
copy of such notice by certified or registered first-class postage prepaid mail, not less than three
(3) days prior to the redemption date, to the registered owner of each of the Bonds being
redeemed determined as of the close of business on the day preceding the first mailing of such
notice at the address appearing on the registration books of the City. Such notice is to specify
the number or numbers of the Bonds to be redeemed, whether in whole or in part, the principal
amounts thereof and the date fixed for redemption and is further to state that on the redemption
date there will be due and payable upon each Bond or part thereof so to be redeemed the
principal amount or part thereof plus accrued interest thereon to the redemption date plus any
premium due and that from and after such date interest will cease to accrue. Bonds called for
optional redemption as provided herein are redeemable only to the extent of moneys on deposit
with the paying agent and legally available for redemption of Bonds on the date of such notice.
Failure to mail any notice as aforesaid or any defect in any notice so mailed with respect to any
Bond does not affect the validity of the redemption proceedings with respect to any other Bond.
The principal of, interest on and any premium due in connection with the
redemption of this Bond are payable to the Registered Owner by the Financial Officer of the
City, or his successors, as paying agent. The principal and interest are payable to the Registered
Owner upon presentation and surrender of this Bond at maturity or upon prior redemption, by
check or draft mailed to the Registered Owner at the address appearing on the registration books
of the City maintained by the Financial Officer of the City, or his successors, as registrar, or by
12
wire transfer to such bank or other depository as the Registered Owner shall designate in writing
to the paying agent. Any interest hereon not paid when due and any interest hereon accruing
after maturity is payable to the Registered Owner determined as of the close of business on the
special record date, which is to be fixed by the paying agent for such purpose. irrespective of any
transfer of ownership of this Bond subsequent to such special record date and prior to the date
fixed by the paying agent for the payment of such interest, by check or draft or wire transfer
directed to the Registered Owner as aforesaid. Notice of the special record date and of the date
fixed for the payment of such interest is to be given by sending a copy thereof by certified or
registered first-class postage prepaid mail, at least fifteen (15) days prior to the special record
date, to the registered owner of each Bond upon which interest will be paid determined as of the
close of business on the day preceding such mailing at the address appearing on the registration
books of the City. Any premium is payable to the Registered Owner upon presentation and
surrender of this Bond upon prior redemption, by check or draft or wire transfer directed to the
Registered Owner as aforesaid. If the date for making or giving any payment, determination or
notice described herein is a Saturday, Sunday, legal holiday or any other day on which the office
of the paying agent or registrar is authorized or required by law to remain closed, such payment,
determination or notice is to be made or given on the next succeeding day which is not a
Saturday, Sunday, legal holiday or other day on which the office of the paying agent or registrar
is authorized or required by law to remain closed.
Payment of the principal of, interest on and any premium due in connection with
the redemption of this Bond is to be made solely from, and as security for such payment there is
pledged, pursuant to the Ordinance authorizing the issuance of this Bond, a special fund
. designated as the Tax Increment Fund and a special account designated as the Subordinate
Bonds Debt Service Account, into which account the City has covenanted in the Ordinance to
pay, respectively, from the pledged revenues described in the Ordinance sums sufficient to pay
when due the principal of, interest on and any premium due in connection with redemption of
this Bond and any additional securities hereafter issued and payable from such pledged revenues
on a parity with the Bonds after provision for payment of all principal and interest due in the
current year on the City's Downtown Development Authority Tax Increment Revenue Refunding
Bonds, Series 1992, the City's Downtown Development Authority Tax Increment Revenue
Refunding Bonds, Series 2001, and any other securities payable from the pledged revenues
superior or senior to the Bonds.
It is hereby recited, certified and warranted that for the payment of the principal
of, interest on and any premium due in connection with the redemption of this Bond the City has
created and will maintain said special fund and account and will deposit therein the required
amounts out of the funds and revenues described in the Ordinance and out of said special fund
and account will pay the principal of, interest on and any premium due in connection with the
redemption of this Bond in the manner provided by the Ordinance.
The Bonds are equitably and ratably secured by a lien on the pledged revenues,
and such Bonds constitute an irrevocable and second lien (but not necessarily an exclusive
second lien) upon the pledged revenues. Bonds and other types of securities, in addition to the
Bonds, subject to expressed conditions, may be issued and made payable from the pledged
revenues having a lien thereon on a parity with the lien of the Bonds or, subject to additional
expressed conditions, having a lien thereon superior and senior with the lien of the Bonds in
accordance with the provisions of the Ordinance. Except as otherwise expressly provided in this
13
Bond and the Ordinance, the pledged revenues are assigned, pledged and set aside to the
payment of the principal of and interest on the Bonds of this issue in anticipation of the
collection of the pledged revenues.
The City covenants and agrees with the Registered Owner that it will keep and
perform all of the covenants of this Bond and of the Ordinance.
This Bond is authorized and issued for the purpose of financing certain capital
improvements and capital projects pursuant to, by virtue of and in full conformity with the
Constitution of the State of Colorado, the City Charter, part 8 of article 25 of title 31, Colorado
Revised Statutes, as amended, and all other laws of the State of Colorado thereunto enabling, and
pursuant to the Ordinance duly adopted prior to the issuance of this Bond.
Reference is hereby made to the Ordinance, and to any and all modifications and
amendments thereof, for a description of the provisions, terms and conditions upon which the
Bonds are issued and secured, including, without limitation, the nature and extent of the security
for the Bonds, provisions with respect to the custody and application of the proceeds of the
Bonds, the collection and disposition of the revenues and moneys charged with and pledged to
the payment of the principal of, interest on and any premium due in connection with the
redemption of the Bonds, the terms and conditions on which the Bonds are issued, a description
of the special fund and account referred to above and the nature and extent of the security and
pledge afforded thereby for the payment of the principal of,-interest on and any premium due in
connection with the redemption of the Bonds, and the manner of enforcement of said pledge, as
well as the rights, duties, immunities and obligations of the City and the members of its Council
and also the rights and remedies of the registered owners of the Bonds.
To the extent and in the respects permitted by the Ordinance, the provisions of the
Ordinance, or any instrument amendatory thereof or supplemental thereto, may be modified or
amended by action of the City taken in the manner and subject to the conditions and exceptions
provided in the Ordinance. The pledge of revenues and other obligations of the City under the
Ordinance may be discharged at or prior to the maturity or prior redemption of the Bonds upon
the making of provision for the payment of the Bonds on the terms and conditions set forth in the
Ordinance..
It is hereby recited, certified and warranted that all the requirements of law have
been fully complied with by the proper officers of the City in the issuance of this Bond; that it is
issued pursuant to and in strict conformity with the Constitution and all other laws of the State of
Colorado, including the City Charter, and with the Ordinance; that this Bond does not contravene
any constitutional or statutory limitation of the State of Colorado or any limitation of the City
Charter; and that this Bond is issued under the authority of the Ordinance.
For the payment of the principal of, interest on and any premium due in
connection with the redemption of this Bond the City pledges the exercise of all its lawful
corporate powers.
This Bond is transferable only upon the registration books of the City by the
Financial Officer of the City, or his successors, as transfer agent, at the request of the Registered
Owner or his, her or its duly authorized attorney-in-fact or legal representative, upon surrender
14
hereof together with a written instrument of transfer duly executed by the Registered Owner or
his, her or its duly authorized attorney-in-fact or legal representative with guaranty of signature
satisfactory to the transfer agent, containing written instructions as to the details of the transfer,
along with the social security number or federal employer identification number of the transferee
and, if the transferee is a trust, the names and social security numbers of the settlors and the
beneficiaries of the trust. The transfer agent is not required to transfer ownership of this Bond
during the fifteen (15) days prior to the first mailing of any notice of redemption or to transfer
ownership of any Bond selected for redemption on or after the date of such mailing. The
Registered Owner may also exchange this Bond for another Bond or Bonds of authorized
denominations. Transfers and exchanges are to be made without charge, except that the transfer
agent may require payment of a sum sufficient to defray any tax or other governmental charge
that may hereafter be imposed in connection with any transfer or exchange of Bonds. No
transfer of this Bond is to be effective until entered on the registration books of the City. In the
case of every transfer or exchange, the transfer agent is to deliver to the new registered owner a
new Bond or Bonds of the same aggregate principal amount, maturing in the same year, and
bearing interest at the same per annum interest rate as the Bond or Bonds surrendered. Such
Bond or Bonds are to be dated as of their date of authentication. The City may deem and treat
the person or entity in whose name this Bond is last registered upon the books of the City as the
absolute owner hereof for the purpose of receiving payment of the principal of, interest on and
any premium due in connection with the redemption of this Bond and for all other purposes, and
all such payments so made to such person or upon his, her or its order will be valid and effective
to satisfy and discharge the liability of the City upon this Bond to the extent of the sum or sums
so paid, and the City will not be affected by any notice to the contrary.
This Bond is a special and limited obligation of the City payable solely out of and
secured by an assignment and pledge (but not necessarily an exclusive assignment and pledge)
of certain tax increment revenues and certain income derived from the investment of such
revenues and of certain bond proceeds, all as more specifically provided in the Ordinance, and of
certain funds and accounts pledged in the Ordinance. This Bond does not constitute a debt or an
indebtedness or a multiple-fiscal year financial obligation of the City within the meaning of any
constitutional, charter or statutory provision or limitation of the State of Colorado or of the City.
This Bond is not a general obligation of the City, and the full faith and credit of the City is not
pledged for the payment of the principal of or interest on this Bond.
IN WITNESS WHEREOF, the City has caused this Bond to be executed in its
name and on its behalf with the facsimile or manual signature of the Mayor of the City, to be
sealed with a facsimile or manual impression of the seal of the City, to be attested with the
facsimile or manual signature of the City Clerk of the City, and to be countersigned with the
facsimile or manual signature of the Financial Officer of the City.
15
CITY OF FORT COLLINS, COLORADO
(CITY) By: (Facsimile or Manual Signature)
(SEAL) Mayor
ATTEST:
(Facsimile or Manual Signature)
City Clerk
Countersigned:
(Facsimile or Manual Signature)
Financial Officer
16
CERTIFICATE OF AUTHENTICATION
This Bond is issued pursuant to the Ordinance herein described.
FINANCIAL OFFICER OF THE CITY
as registrar
(Manual Signature)
Dated: December 30, 2002
17
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
Bond, shall be construed as though they were written out in full according to applicable laws or
regulations.
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with the right of
survivorship and not as tenants in
common
UNIF TRANS MIN ACT Custodian
(Cult) (Minor)
under Uniform Transfers to Minors Act
(State)
Additional abbreviations may also be used
though not on the above list.
18
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Name and Address of Assignee)
this Bond and does hereby irrevocably constitute and appoint
or its successors, to transfer this Bond on the books kept for registration
thereof.
Dated:
Signature guaranteed:
(Eligible Guarantor Institution)
NOTICE: The signature to this assignment must
correspond with the name of the Registered
Owner as it appears upon the face of this Bond in
every particular without alteration or
enlargement or any change whatever.
[End of Form of Bond]
19
C. Bonds Equally Secured. The covenants and agreements herein set forth to be
performed on behalf of the City shall be for the equal benefit, protection and security of the Owners
of the Bonds, all of which, regardless of the time or times of their maturity, shall be of equal rank
without preference, priority or distinction of any of the Bonds over any other thereof, except as
otherwise expressly provided in or pursuant to this Ordinance.
D. Financial Obligations. All of the Bonds, as to all Debt Service Requirements
thereof, shall be payable solely out of the Pledged Revenues. The Owners of the Bonds may not look
to the general or any other fund of the City for the payment of the Debt Service Requirements
thereof, except the special fund and account pledged therefor, and the Bonds shall constitute special
and limited obligations of the City.
Section 4. Sale of Bonds.
A. Purchaser's Proposal. A proposal for the purchase of the Bonds upon terms
favorable to the City has been received from the Purchaser, and the Financial Officer of the City has
recommended that said proposal be accepted by the Council.
B. Award of Contract. The contract for the purchase of the Bonds is hereby awarded
to the Purchaser at a price equal to the aggregate principal amount of the Bonds plus accrued interest,
if any, from their date of issue to the date of delivery thereof to the Purchaser and upon the terms set
forth in this Ordinance.
C. Approval of Investment Letter. The Council hereby approves the form of the
Investment Letter.
Section 5. Disposition of Bond Proceeds and Pledged Revenues: Funds and Accounts
Adopted or Created by Ordinance: Security For Bonds. The proceeds of the sale of the Bonds and
the Pledged Revenues received by the City shall be deposited by the City in the funds described in
this Section 5, to be accounted for in the manner and priority set forth in this Section 5.
Neither the Purchaser nor any subsequent Owner of any Bond shall be responsible for
the application or disposal by the City or by any of its officers, agents and employees of the moneys
derived from the sale of the Bonds or of any other moneys designated in this Section 5.
The Pledged Revenues and all moneys and securities paid or to be paid to or held or to
be held in any fund or account hereunder (except the Tax Increment Principal and Interest Account
and the Tax Increment Reserve Account) are hereby assigned and pledged, subject to the provisions
hereof, to secure the payment of the Debt Service Requirements of the Bonds and any Additional
Parity Bonds. This assignment and pledge shall be valid and binding from and after the date of the
first delivery of the Bonds, and the moneys, as received by the City and hereby assigned and pledged,
shall immediately be subject to the lien of this assignment and pledge without any physical delivery
thereof, any filing, or further act. The lien of this assignment and pledge and the obligation to
perform the contractual provisions hereby made shall have priority over any or all other obligations
and liabilities of the City (except as herein otherwise expressly provided), and the lien of this
assignment and pledge shall be valid and binding as against all parties having claims of any kind in
tort, contract or otherwise against the City (except as herein otherwise expressly provided),
irrespective of whether such parties have notice thereof.
20
A. Disposition of Bond Proceeds. The City shall deposit in the Development and
Expense Fund forthwith upon receipt thereof the net proceeds of the Bonds, to be used and
withdrawn only as provided in this Section 5A. The net proceeds of the Bonds deposited in the
Development and Expense Fund shall be used and paid out from time to time solely for the purpose
of paying the Cost of the Project. Any proceeds of the Bonds remaining in the Development and
Expense Fund after payment in full of the Cost of the Project may be transferred to the Tax Increment
Fund and used for the purposes thereof.
B. Disposition of Tax Increment Revenues. For so long as any of the Bonds shall be
Outstanding, as to any Debt Service Requirements, except as otherwise provided herein. the Tax
Increment Revenues, upon their receipt from time to time by the City, shall be set aside and credited
immediately to the Tax Increment Fund.
For so long as any of the Bonds shall be Outstanding as to any Debt Service
Requirements, the Tax Increment Fund shall be accumulated and administered, and the moneys on
deposit therein shall be applied, in the following order of priority:
(1) First, to the Tax Increment Principal and Interest Account to pay any Debt
Service Requirements of Superior Bonds or Superior Securities then Outstanding in the
manner set forth in Section 5C hereof;
(2) Second, to the Tax Increment Reserve Account, in the manner set forth in
Section 5D hereof; and
(3) Third, to the Subordinate Bonds Debt Service Account to pay the Debt
Service Requirements of the Bonds, any Additional Parity Bonds and any other Parity
Securities in accordance with Section 5F hereof.
C. Tax Increment Principal and Interest Account Payments. The City shall deposit in
the Tax Increment Principal and Interest Account from the Tax Increment Revenues on or before the
last day of each month, the following amounts:
(1) Interest Payments. One-sixth (1/6) of the aggregate amount of the next
installment of interest due on the next Interest Payment Date in the current Bond Year plus
any other amounts due for interest on Superior Bonds or Superior Securities then Outstanding.
(2) Principal Payments. One-sixth (1/6) of the aggregate amount of the next
installment of principal due on the next principal payment date in the current Bond Year plus
any other amounts due for principal of Superior Bonds or Superior Securities then
Outstanding.
The Tax Increment Principal and Interest Account shall be maintained as a sinking
fund for the mandatory redemption of the 1992 Tax Increment Refunding Bonds maturing on
December 1, 2006. Any mandatory sinking fund redemption shall be treated as an installment of
principal for purposes of this Section 5C.
Nothing herein shall be construed so as to prevent the City from creating separate
subaccounts within the Tax Increment Principal and Interest Account for separate series of Superior
Bonds or Superior Securities and accounting separately for any deposits made thereto on account of
21
such Superior Bonds or Superior Securities or from creating separate principal and interest accounts
for such Superior Bonds or Superior Securities, if such action is deemed by the City to be necessary
or desirable in order to comply with any statute or regulation governing the exclusion from gross
income under federal income tax laws of interest on any such Superior Bonds or Superior Securities,
provided that any such separate subaccounts shall have claims to the Tax Increment Revenue., equal
to and on a parity with those of the other such subaccounts and any such separate principal and
interest account shall have a claim to the Tax Increment Revenues equal to and on a parity with that
of the Tax Increment Principal and Interest Account.
D. Tax Increment Reserve Account Payments. The City shall retain in the Tax
Increment Reserve Account a sum equal to the Average Annual Debt Service Requirements of the
1992 Tax Increment Revenue Refunding Bonds and the 2001 Tax Increment Revenue Refunding
Bonds or, if the maximum amount permitted by applicable federal tax law is either greater or lesser.
said amount. Subject to the payments required by Section 5C hereof, except as provided in Section
5E hereof, from and to the extent of any moneys remaining in the Tax Increment Fund; there shall be
credited as hereinafter provided and from time to time thereafter to the Tax Increment Reserve
Account moneys sufficient to accumulate in and maintain the Tax Increment Reserve Account at an
amount at least equal to the Combined Average Annual Debt Service Requirements of all
Outstanding Superior Bonds or Superior Securities for which the Tax Increment Reserve Account is
maintained. Said amount shall be maintained as a continuing reserve solely for the payment of the
Debt Service Requirements of all Superior Bonds or Superior Securities for which the Tax Increment
Reserve Account is maintained, except as otherwise provided herein. No payment need be made into
the Tax Increment Reserve Account so long as the moneys therein shall equal not less than said
amount. In the event that the amount of the Tax Increment Reserve Account falls below the minimum
amount required to be maintained therein, the City shall credit to the Tax Increment Reserve Account
that sum of money needed to accumulate or reaccumulate the amount therein so that at all times the
amount of the Tax Increment Reserve Account equals said minimum amount. The moneys in the Tax
Increment Reserve Account shall be set aside, accumulated, and, if necessary, reaccumulated as
provided herein, from time to time, and maintained as a continuing reserve to be used, except as
hereinafter provided in Section 5E and Section 9 hereof, only to prevent deficiencies in the Tax
Increment Principal and Interest Account resulting from failure to deposit therein sufficient Pledged
Revenues to pay the Debt Service Requirements of all Superior Bonds or Superior Securities for
which the Tax Increment Reserve Account is maintained as the same become due.
If at any time the City shall for any reason fail to pay into the Tax Increment Principal
and Interest Account the full amount above stipulated for payment of Debt Service Requirements on
all Superior Bonds or Superior Securities, then an amount shall be paid into the Tax Increment
Principal and Interest Account at such time from the Tax Increment Reserve Account equal to the
difference between that paid from the Tax Increment Revenues and the full amount so stipulated.
The money so used shall be replaced to the Tax Increment Reserve Account from the first moneys
credited to the Tax Increment Fund thereafter received and not required to be otherwise applied by
Section 5C hereof.
If a separate reserve fund or account is maintained for separate series of Superior
Bonds or Superior Securities, then the moneys replaced in the Tax Increment Reserve Account and
such separate reserve fund or account shall be replaced on a pro rata basis, as moneys become
available therefor.
22
. If at any time the City shall for any reason fail to pay into the Tax Increment Reserve
Account the full amount stipulated herein from the moneys credited to the Tax Increment Fund, the
difference between the amount paid and the amount stipulated shall in a like manner be paid therein
from the first Pledged Revenues credited to the Tax Increment Fund thereafter received and not
required to be applied otherwise by Section 5C hereof.
Nothing in this Ordinance shall be construed as limiting the right of the City to
substitute for the cash deposit required to be maintained hereunder a letter of credit, surety bond.
insurance policy, agreement guaranteeing payment, or other undertaking by a financial institution to
ensure that cash in the amount otherwise required to be maintained hereunder will be available to the
City as needed, provided that any such substitution shall first be approved in writing by the Persons
specified in the ordinances authorizing the issuance of Superior Bonds or Superior Securities and
shall not cause the then-current ratings of the Superior Bonds or Superior Securities to be adversely
affected.
E. Termination of Tax Increment Deposits. No payment need be made into the Tax
Increment Principal and Interest Account or the Tax Increment Reserve Account if the amount in the
Tax Increment Principal and Interest Account and the amount in the Tax Increment Reserve Account
total a sum at least equal to the entire remaining Debt Service Requirements of the Outstanding
Superior Bonds or Superior Securities to their respective Maturity Dates or to any Redemption Date
or Redemption Dates on which the City shall have exercised or shall have obligated itself to exercise
its option to redeem, prior to their respective Maturity Dates, any Superior Bonds or Superior
Securities then Outstanding and thereafter maturing (provided that, solely for the purpose of this
M Section 5E, there shall be deemed to be a credit to the Tax Increment Reserve Account moneys,
Federal Securities and bank deposits, or any combination thereof, accounted for in any other fund or
account of the City and restricted solely for the purpose of paying the Debt Service Requirements of
the Superior Bonds or Superior Securities), in which case moneys in the Tax Increment Principal and
Interest Account and the Tax Increment Reserve Account in an amount, except for any known
interest or other gain to accrue from any investment or deposit of moneys pursuant to Section 6B
hereof from the time of any such investment or deposit to the time or respective times the proceeds of
any such investment or deposit shall be needed for such payment, at least equal to such Debt Service
Requirements, shall be used together with any such gain from such investments and deposits solely to
pay such Debt Service Requirements as the same become due; and any moneys in excess thereof in
the Tax Increment Principal and Interest Account and the Tax Increment Reserve Account and any
other moneys derived from the Tax Increment Revenues may be used in any lawful manner
determined by the City and the Authority, including payment of the Debt Service Requirements of
the Bonds, any Additional Parity Bonds or other Parity Securities.
F. Subordinate Bonds Debt Service Account Payments. The City shall deposit in the
Subordinate Bonds Debt Service Account, forthwith upon receipt of the proceeds of the Bonds,
accrued interest, if any, from their date of issue to their date of delivery to the Purchaser to apply to
the payment of interest first due on the Bonds. After there have been deposited in the Tax Increment
Principal and Interest Account an amount sufficient to pay all the Debt Service Requirements due or
to become due during the current Bond Year on all Superior Bonds or Superior Securities then
Outstanding and after the accumulations to and replenishments of the Tax Increment Reserve
Account to be made in the current Bond Year have been made, any moneys remaining in the Tax
Increment Fund in any Bond Year may be used by the City for the payment of Debt Service
Requirements of the Bonds, any Additional Parity Bonds or any other Parity Securities; but the lien
23
of such securities on the Tax Increment Revenues and the pledge thereof for the payment of such
securities shall be subordinate and junior to the lien and pledge for the payment of all Superior Bonds
or Superior Securities as herein provided.
G. Budget and Appropriation of Sums. The Sums required to make the payments
specified in this Section 5 shall be appropriated for said purposes, and the amounts so required in
each year shall be included in the budget and the annual appropriation ordinance or measures to be
adopted or passed by the Council while any of the Bonds, as to either principal or interest, are
Outstanding and unpaid. No provisions of any constitution, charter, statute, ordinance, resolution, or
other order or measure enacted after the issuance of the Bonds shall in any manner be construed as
limiting or impairing the obligation of the City to keep and perform the covenants contained in this
Ordinance so long as any of the Bonds remain Outstanding and unpaid.
Section 6. General Administration of Funds and Accounts.
A. Places and Times of Deposits. Each of the special funds or accounts referred to in
Section 5 hereof shall be kept separate and apart from all other accounts or funds of the City as trust
accounts solely for the purposes herein designated therefor. For purposes of investment of moneys,
nothing, except as specifically provided herein, prevents the commingling of moneys accounted for in
any two or more such funds or accounts pertaining to the Pledged Revenues or to such fund and
account and any other funds or accounts of the City adopted or created under this Ordinance. Such
funds or accounts shall be continuously secured to the fullest extent required and permitted by the
laws of the State for the securing of public funds and shall be irrevocable and not withdrawable by
anyone for any purpose other than the respective designated purposes of such funds and accounts.
Each periodic payment shall be credited to the proper fund or account not later than the date therefor
herein designated, except that when any such date shall be a Saturday, a Sunday or a legal holiday,
then such payment shall be made on or before the next preceding business day.
B. Investment of Funds and Accounts. Any moneys in Development and Expense
Fund and the Subordinate Bonds Debt Service Account may be deposited, invested, or reinvested
only in Permitted Investments. Securities or obligations purchased as such an investment shall either
be subject to redemption at any time at face value by the Owner thereof at the option of such Owner
or shall mature at such time or times as shall most nearly coincide with the expected need for moneys
from the fund or account in question. Securities or obligations so purchased as an investment of
moneys in any such fund or account shall be deemed at all times to be a part of the applicable fund or
account; provided that the interest accruing on such investments and any profit realized therefrom
shall be credited to the Tax Increment Fund and any loss resulting from such investments shall be
charged to the particular fund or account in question. The City shall present for redemption or sale
on the prevailing market any securities or obligations so purchased as an investment of moneys in a
given fund or account whenever it shall be necessary to do so in order to provide moneys to meet any
required payment or transfer from such fund or account.
C. No Liability for Losses Incurred in Performing Terms of Ordinance. Neither the
City nor any officer of the City shall be liable or responsible for any loss resulting from any
investment or reinvestment made in accordance with this Ordinance.
D. Character of Funds. The moneys in any fund or account herein authorized shall
consist of lawful money of the United States of.America or Permitted Investments or both such
24
• money and Permitted Investments. Moneys deposited in a demand or time deposit account in a
Commercial Bank, appropriately secured according to the laws of the State, shall be deemed lawful
money of the United States of America.
E. Accelerated Payments Optional. Nothing contained herein prevents the
accumulation in any fund or account herein designated of any monetary requirements at a taster rate
than the rate or minimum rate, as the case may be, provided therefor, but no payment shall be so
accelerated if such acceleration shall cause a default in the payment of any obligation of the City
pertaining to the Pledged Revenues.
Section 7. Priorities: Liens: Issuance of Additional Bonds.
A. Lien on Pledged Revenues. Except as expressly provided in this Ordinance with
respect to the issuance of Superior Bonds or Superior Securities and Additional Parity Bonds or
Parity Securities, the Tax Increment Revenues and the Investment Earnings shall be and hereby are
irrevocably assigned, pledged and set aside to pay the Debt Service Requirements of the Bonds. The
Bonds constitute an irrevocable and second lien (but not necessarily an exclusive second lien) upon
the Tax Increment Revenues and the Investment Earnings. The Bonds, any Additional Parity Bonds
and any other Parity Securities authorized to be issued and from time to time Outstanding are
equitably and ratably secured by a lien on the Tax Increment Revenues and the Investment Earnings
and shall not be entitled to any priority one over the other in the application thereof regardless of the
time or times of the issuance of the Bonds, any Additional Parity Bonds and any other Parity
Securities, it being the intention of the Council that there shall be no priority among the Bonds, any
Additional Parity Bonds and any other Parity Securities, regardless of the fact that they may be
actually issued and delivered at different times.
B. Issuance Of Additional Parity Bonds. Nothing herein, subject to the limitations
stated in Section 7D hereof, prevents the issuance by the City of Additional Parity Bonds payable
from the Tax Increment Revenues and the Investment Earnings and constituting a lien thereon on a
parity with the lien thereon of the Bonds.
C. Additional Superior Securities Permitted. Subject to the limitations stated in
Section 7D hereof and in the ordinances authorizing the issuance of Superior Bonds or Superior
Securities, the City may issue additional Superior Bonds or additional Superior Securities for any
lawful purpose payable from the Tax Increment Revenues and the Investment Earnings and having a
lien thereon superior and senior to the lien thereon of the Bonds.
D. Supplemental Ordinances. Additional Parity Bonds or Superior Bonds or Superior
Securities shall be issued only after authorization thereof by ordinance, supplemental ordinance or
other instrument of the Council, in substantially the same form as this Ordinance, stating the purpose
or purposes of the issuance of such additional securities, directing the application of the proceeds
thereof to such purpose or purposes, directing the execution thereof, and fixing and determining the
date, series designation, principal amount, maturity or maturities, maximum rate or rates of interest,
and prior redemption privileges of the City with respect thereto, and providing for payments to and
from the applicable funds and accounts in accordance with this Ordinance. All additional securities
shall bear such date, shall be payable as to principal on June 1 or December 1 or both and as to
interest on June 1 and December 1 and shall be subject to redemption prior to maturity on such terms
25
and conditions, as may be provided, and shall bear interest at such rate or rates as may be fixed by
ordinance, instrument or other document of the Council.
Section 8. Covenants.
The City hereby particularly covenants and agrees with the Owners of the Bonds front
time to time, and makes provisions which shall be a part of its contract with such Owners, which
covenants and provisions shall be kept by the City continuously until all of the Bonds have been fully
paid and discharged:
A. Continuance and Collection of Tax Increment Revenues.
(1) The Plan of Development, as approved and amended as described in this
Ordinance, is now in full force and effect. The City will not revoke its approval or amend the
Plan of Development in any manner which would diminish the Tax Increment Revenues.
(2) The City shall continue to collect the Tax Increment Revenues in
accordance with the Downtown Development Authority Act.
(3) The City shall maintain the Tax Increment Fund as a fund of the City
separate and distinct from all other funds of the City and shall place the Tax Increment
Revenues therein. The Tax Increment Fund shall be subject to appropriation only as
authorized by the Downtown Development Authority Act and this Ordinance.
(4) All of the Tax Increment Revenues shall be subject to the payment of the
Debt Service Requirements of all securities payable therefrom, including reserves therefor, as
provided herein or in any instrument supplemental or amendatory hereto.
B. Defense of Legality of Pledged Revenues. There is not pending or threatened any
suit, action or proceeding against or affecting the City before or by any court, arbitrator,
administrative agency or other governmental authority which affects the validity or legality of this
Ordinance, any ordinance affecting the Tax Increment Revenues or any of the City's obligations
under such ordinances.
The City shall, to the extent permitted by law, defend the validity and legality of all
ordinances affecting the Tax Increment Revenues and all amendments thereto against all claims, suits
and proceedings which would diminish or impair the Pledged Revenues.
Except as permitted in this Ordinance, the City has not assigned or pledged the
Pledged Revenues in any manner which would diminish the security for payment of the Bonds.
C. Performance of Duties. The City, acting and through its officers, or otherwise,
shall faithfully and punctually perform, or cause to be performed, all duties with respect to the
Pledged Revenues required by the Constitution and laws of the State, the Charter and the various
ordinances, resolutions and contracts of the City, including, without limitation, the proper segregation
of the proceeds of the Bonds and the Pledged Revenues and their application from time to time to the
respective funds provided therefor.
26
D. Contractual Obligations. The City will perform all contractual obligations
undertaken by it under the contract with the Purchaser and any other agreements relating to the Bonds
and the Pledged Revenues.
E. Further Assurances. At any and all times the City shall, so far as it may he
authorized by law, pass, make, do, execute, acknowledge, deliver, and file or record all and every
such further instruments, acts, deeds, conveyances, assignments, transfers, other documents, and
assurances as may be necessary or desirable for the better assuring, conveying, granting, assigning
and confirming all and singular the rights, the Pledged Revenues and other funds and accounts hereby
pledged or assigned, or intended so to be, or which the City may hereafter become bound to pledge or
to assign, or as may be reasonable and required to carry out the purposes of this Ordinance. The City,
acting by and through its officers, or otherwise, shall at all times, to the extent permitted by law,
defend, preserve and protect the pledge of the Pledged Revenues and other funds and accounts
pledged hereunder and all the rights of every Owner of any of the Bonds against all claims and
demands of all Persons whomsoever.
F. Conditions Precedent. Upon the date of issuance of any of the Bonds, all
conditions, acts and things required by the Constitution or laws of the United States of America, the
Constitution or laws of the State, the Charter, or this Ordinance, to exist, to have happened, and to
have been performed precedent to or in the issuance of the Bonds shall exist, have happened and have
been performed, and the Bonds do not contravene any debt or other limitation prescribed by the
Constitution or laws of the United States of America, the Constitution or laws of the State or the
Charter.
G. Records. The City will keep proper books of record and account, separate and
apart from all other records and accounts, showing complete and correct entries of all transactions
relating to the funds and accounts described herein.
H. Protection of Security. The City, its officers, agents and employees, shall not take
any action in such manner or to such extent as might prejudice the security for the payment of the
Debt Service Requirements of the Bonds and any other securities payable from the Pledged Revenues
according to the terms thereof. No contract shall be entered into nor any other action taken by which
the rights of any Owner of any Bond or other security payable from Pledged Revenues might be
materially impaired or diminished.
I. Accumulation of Interest Claims. In order to prevent any accumulation of claims
for interest after maturity, the City shall not directly or indirectly extend or assent to the extension of
the time for the payment of any claim for interest on any of the Bonds or any other securities payable
from the Pledged Revenues; and the City shall not directly or indirectly be a party to or approve any
arrangements for any such extension or for the purpose of keeping alive any of such other claims for
interest. If the time for the payment of any such installment of interest is extended in contravention
of the foregoing provisions, such installment or installments of interest after such extension or
arrangement shall not be entitled in case of default hereunder to the benefit or the security of this
Ordinance, except upon the prior payment in full of the principal of all of the Bonds and any such
securities the payment of which has not been extended.
27
J. Prompt Payment of Bonds. The City shall promptly pay the Debt Service
Requirements of every Bond on the dates and in the manner specified herein and in the Bonds
according to the true intent and meaning hereof.
K. Use of Funds and Accounts. The funds and accounts described in the Ordinance
shall be used solely and only, and the moneys credited to such accounts are hereby pledged. solely for
the purposes specified herein.
L. Additional Securities. The City shall not hereafter issue any bonds or securities
payable from the Pledged Revenues without compliance with the requirements with respect to the
issuance of such bonds or securities set forth herein to the extent applicable.
M. Other Liens. There are no liens or encumbrances of any nature whatsoever on or
against any of the Tax Increment Revenues except as provided herein.
N. Surety Bonds. Each official or other person having custody of any Pledged
Revenues, or responsible for their handling, shall be fully bonded at all times, which bond shall be
conditioned upon the proper application of said moneys.
Section 9. Defeasance.
When all Debt Service Requirements of the Bonds have been duly paid, the pledge
and lien and all obligations hereunder shall thereby be discharged and the Bonds shall no longer be
deemed to be Outstanding within the meaning of this Ordinance. There shall be deemed to be such
due payment when the City has placed in escrow or in trust with a Trust Bank located within or
without the State, moneys or Federal Securities in an amount sufficient (including the known
minimum yield available for such purpose from Federal Securities in which such amount wholly or in
part may be initially invested) to meet all Debt Service Requirements of the Bonds, as the same
become due to their respective Maturity Dates or to any Redemption Date as of which the City shall
have exercised or shall have obligated itself to exercise its option to redeem Bonds prior to their
respective Maturity Dates. The Federal Securities shall be non-callable and shall become due prior to
the respective times at which the proceeds thereof shall be needed, in accordance with a schedule
established and agreed upon between the City and such Trust Bank at the time of the creation of the
escrow or trust, or the Federal Securities shall be subject to redemption at the option of the Owner
thereof to assure such availability as so needed to meet such schedule. Nothing herein shall be
construed to prohibit a partial defeasance of the Outstanding Bonds in accordance with the provisions
of this Section 9.
Section 10. Default Provisions and Remedies of Bond Owners.
A. Events of Default. Each of the following events is hereby declared to be an Event
of Default by the City:
(1) Payment of Principal or Premium. Payment of the principal of any of the
Bonds or any premium due in connection with the redemption thereof is not made when the
same becomes due and payable, either at maturity or upon prior redemption, or otherwise;
(2) Nonpayment of Interest. Payment of any installment of interest on any of
the Bonds is not made when the same becomes due and payable;
28
(3) Incapacity to Perform. The City for any reason becomes incapable of
fulfilling its obligations hereunder;
(4) Nonperformance of Duties. The City shall have failed to carry out and to
perform (or in good faith to begin the performance of) all acts and things lawfully required to
be carried out to be performed by it under any contract relating to the Bonds or the Pledged
Revenues, or to all or any combination thereof, or otherwise including, without limitation, this
Ordinance, and such failure shall continue for sixty (60) days after receipt of notice from the
Owners of ten percent (10%) in aggregate principal amount of the Bonds then Outstanding;
(5) Appointment of Receiver. An order or decree is entered by a court of
competent jurisdiction, with the consent or acquiescence of the City, appointing a receiver or
receivers for the Pledged Revenues and any other moneys subject to the lien to secure the
payment of the Bonds, or if any order or decree, having been entered without the consent or
acquiescence of the City, is not vacated or discharged or stayed on appeal within sixty (60)
days after entry;
(6) Default of Any Provision. The City makes any default in the due and
punctual performance of any other of the representations, covenants, conditions, agreements
and other provisions contained in the Bonds or in this Ordinance on its part to be performed,
and such default continues for sixty (60) days after written notice, specifying such default and
requiring the same to be remedied, is given to the City by the Owners of ten percent (10%0) in
aggregate principal amount of the Bonds then Outstanding.
• B. Remedies for Defaults. Upon the happening and continuance of any Event of
Default, the Owner or Owners of not less than ten percent (10%) in aggregate principal amount of the
Bonds then Outstanding, including, without limitation, a trustee or trustees therefor, may proceed
against the City and its agents, officers and employees to protect and to enforce the rights of any
Owner of Bonds under this Ordinance by mandatory injunction or by other suit, action, or special
proceedings in equity or at law, in any court of competent jurisdiction, either for the appointment of a
receiver or an operating trustee or for the specific performance of any covenant or agreement
contained herein or for any proper legal or equitable remedy as such Owner or Owners may deem
most effectual to protect and to enforce the aforesaid rights, or thereby to enjoin any act or thing
which may be unlawful or in violation of any right of any Owner of any Bond, or to require the City
to act as if it were the trustee of an expressed trust, or any combination of such remedies, or as
otherwise may be authorized by any statute or other provision of law. All such proceedings at law or
in equity shall be instituted, had and maintained for the equal benefit of all Owners of the Bonds and
any Parity Securities then Outstanding. Any receiver or operating trustee appointed in any
proceedings to protect the rights of such Owners hereunder, the consent to any such appointment
being hereby expressly granted by the City, may collect, receive and apply all Pledged Revenues
arising after the appointment of such receiver or operating trustee in the same manner as the City
itself might do. Notwithstanding the foregoing or any other applicable provisions of law, no Event of
Default shall result in acceleration of any obligation of the City represented by the Bonds.
C. Rights and Privileges Cumulative. The failure of any Owner of any Outstanding
Bond to proceed in any manner herein provided shall not relieve the City, or any of its officers,
agents or employees of any liability for failure to perform or carry out any duty, obligation or other
commitment. Each right or privilege of any such Owner or any trustee thereof is in addition and is
29
cumulative to any other right or privilege, and the exercise of any right or privilege by or on behalf of
any Owner shall not be deemed a waiver of any other right or privilege thereof. Each Owner of any
Bond shall be entitled to all of the privileges, rights, and remedies provided or permitted in this
Ordinance and as otherwise provided or permitted by law or in equity or by statute, except as
provided in Section 12A and Section 12B hereof, and subject to the applicable provisions concerning
the Pledged Revenues and the proceeds of the Bonds. Nothing herein affects or impairs the right of
any Owner of any Bond to enforce the payment of the Debt Service Requirements due in connection
with his, her or its Bond or the obligation of the City to pay the Debt Service Requirements of each
Bond to the Owner thereof at the time and the place expressed in such Bond.
D. Duties Upon Defaults. Upon the happening of any of the Events of Default as
provided in Section 10A hereof, the City, in addition, shall do and perform all proper acts on behalf
of and for the Owners of the Outstanding Bonds to protect and to preserve the security created for the
payment of their Bonds and to insure the payment of the Debt Service Requirements of the Bonds
promptly as the same become due. During any period of default, so long as any of the Bonds, as to
any Debt Service Requirements, are Outstanding, except to the extent it may be unlawful to do so, all
Pledged Revenues shall be paid into the Tax Increment Principal and Interest Account, or, in the
event of securities hereafter or heretofore issued and Outstanding during such period of time senior to
or on a parity with the Bonds, shall be applied as provided in Section 5C and Section 5F hereof on an
equitable and prorated basis, and used for the purposes therein provided. If the City fails or refuses to
proceed as in this Section IOD provided, the Owner or Owners of not less than ten percent (10%) in
principal amount of the Bonds then Outstanding, after demand in writing, may proceed to protect and
to enforce the rights of the Owners of the Bonds as hereinabove provided; and to that end any such
Owners of Outstanding Bonds shall be subrogated to all rights of the City under any agreement or
contract involving the Pledged Revenues entered into prior to the effective date of this Ordinance or
thereafter while any of the Bonds are Outstanding. Nothing herein requires the City to proceed as
provided herein if it determines in good faith and without any abuse of its discretion that such action
is likely materially and prejudicially to affect the Owners of the Outstanding Bonds and any
Outstanding Parity Securities.
E. Evidence of Security Owners. Any request, consent or other instrument which this
Ordinance may require or may permit to be signed and to be executed by the Owner of any Bonds or
other securities may be in one instrument or more than one instrument of similar tenor and shall be
signed or may be executed by each Owner in person or by his, her or its attorney appointed in
writing. Proof of the execution of any such instrument or of any instrument appointing any such
attorney, or the ownership by any Person of the securities, shall be sufficient for any purpose of this
Ordinance (except as otherwise herein expressly provided) if made in the following manner:
(1) Proof of Execution. The fact and the date of the execution by any Owner
of any Bonds or other securities or his, her or its attorney of such instrument may be proved
by the certificate, which need not be acknowledged or verified, of any officer of a bank or
trust company satisfactory to the City Clerk or of any notary public or other officer authorized
to take acknowledgments of deeds to be recorded in the state in which he or she purports to
act that the individual signing such request or other instrument acknowledged to him or her
the execution, duly sworn to before such notary public or other officer; the authority of the
individual or individuals executing any such instrument on behalf of a corporate Owner of
any securities may be established without further proof if such instrument is signed by an
individual purporting to be the president or vice-president of such corporation with the
30
corporate seal affixed and attested by an individual purporting to be its secretary or an
assistant secretary; and the authority of any Person or Persons executing any such instrument
in any fiduciary or representative capacity may be established without further proof if such
instrument is signed by a Person or Persons purporting to act in such fiduciary or
representative capacity; and
(2) Proof of Owners. The amount of Bonds owned by any Person executing
any instrument as an Owner of Bonds, and the numbers, dates and other identification thereof,
together with the dates of his ownership of the Bonds, shall be determined from the
registration books of the City. The amount of other securities, if applicable, owned by any
Person executing any instrument as an Owner of such securities, and the numbers, dates and
other identification thereof, together with the dates of his ownership, if in bearer form, may be
proved by a certificate which need not be acknowledged or verified, in form satisfactory to
the City Clerk, executed by a member of a financial firm or by an officer of a bank or trust
company, insurance company or financial corporation or other depository satisfactory to the
City Clerk, or by any notary public or other officer authorized to take acknowledgments of
deeds to be recorded in the state in which he or she purports to act, showing at the date therein
mentioned that such Person exhibited to such member, officer, notary public or other officer
so authorized to take acknowledgments of deeds or had on deposit with such depository the
securities described in such certificate or if in registered form shall be determined from the
related registration books; but the City Clerk may nevertheless in his or her discretion require
further or other proof in cases where he or she deems the same advisable.
F. Warranty Issuance of Bonds. Any of the Bonds as herein provided, when duly
executed and registered for the purposes provided for in this Ordinance, shall constitute a warranty by
and on behalf of the City for the benefit of each and every future Owner of any of the Bonds that the
Bonds have been issued for a valuable consideration in full conformity with law.
G. Immunities of Purchaser. The Purchaser and any associate thereof are under no
obligation to any Owner of the Bonds for any action that they may not take or in respect of anything
that they may or may not do by reason of any information contained in any reports or other
documents received by them under the provisions of this Ordinance. The immunities and exemption
from liability of the Purchaser and any associate thereof hereunder extend to their officers, directors,
successors, assigns, employees and agents.
Section 11. Amendment of Ordinance.
A. Amendment of Ordinance Not Requiring Consent of Bond Owners. The City may,
without the consent of, or notice to, the Owners of the Bonds, adopt such ordinances supplemental
hereto (which amendments shall thereafter form a part hereof) for any one or more or all of the
following purposes:
(1) To cure or correct any formal defect, ambiguity or inconsistent provision
contained in this Ordinance;
(2) To appoint successors to the Paying Agent, Registrar or Transfer Agent;
31
(3) To designate a trustee for the Owners of the Bonds, to transfer custody and
control of the Pledged Revenues to such trustee, and to provide for the rights and obligations
of such trustee;
(4) To add to the covenants and agreements of the City or the limitations and
restrictions on the City set forth herein;
(5) To pledge additional revenues, properties or collateral to the payment of
the Bonds;
(6) To cause this Ordinance to comply with the Trust Indenture Act of 1939, as
amended from time to time; or
(7) To effect any such other changes hereto which do not in the opinion of
nationally recognized bond counsel materially adversely affect the interests of the Owners of
the Bonds.
B. Amendment of Ordinance Requiring Consent of Bond Owners. Exclusive of the
amendatory ordinances covered by Section I IA hereof, this Ordinance may be amended or modified
by ordinances or other instruments duly adopted by the Council, without receipt by it of any
additional consideration but with the written consent of the Owners of sixty-six percent (66%) in
aggregate principal amount of the Bonds Outstanding at the time of the adoption of such amendatory
ordinance, provided that no such amendatory ordinance shall permit without the written consent of
one hundred percent (100%) in aggregate principal amount of the Bonds Outstanding:
(1) Changing Payment. A change in the maturity or in the terms of redemption
of the principal of any Outstanding Bond or any installment of interest thereon; or
(2) Reducing Return. A reduction in the principal amount of any Bond, the
rate of interest thereon or any premium payable in connection with the redemption thereof,
without the consent of the Owner of the Bond; or
(3) Prior Lien. The creation of a lien upon or a pledge of revenues ranking
prior to the lien or to the pledge created by this Ordinance; or
(4) Modifying Amendment Terms. A reduction of the principal amount or
percentages of Bonds, or any modification otherwise affecting the description of Bonds,
otherwise changing the consent of the Owners of Bonds, which may be required herein for
any amendment hereto; or
(5) Priorities Among Bonds or Parity Securities. The establishment of
priorities as among Bonds issued and Outstanding under the provisions of this Ordinance or
as among Bonds and other Securities on a parity therewith; or
(6) Partial Modification. Any modifications otherwise materially and
prejudicially affecting the rights or privileges of the Owners of less than all of the Bonds then
Outstanding.
. 32
• Whenever the Council proposes to amend or modify this Ordinance under the
provisions of this Section I IB it shall give notice of the proposed amendment by mailing such notice
to all Owners of Bonds at the addresses appearing on the registration books of the City. Such notice
shall briefly set forth the nature of the proposed amendment and shall state that a copy of the
proposed amendatory ordinance or other instrument is on file in the office of the City Clerk for puhlic
inspection.
C. Time for and Consent to Amendment. Whenever at any time within one (1) year
from the date of the completion of the notice required to be given by Section I IB hereof there shall
be filed in the office of the City Clerk an instrument or instruments executed by the Owners of at
least sixty-six percent (66%) in aggregate principal amount of the Bonds then Outstanding, which
instrument or instruments shall refer to the proposed amendatory ordinance or other instrument
described in such notice and shall specifically consent to and approve the adoption of such ordinance
or other instrument, thereupon, but not otherwise, the Council may adopt such amendatory ordinance
or instrument and such ordinance or instrument shall become effective. If the Owners of at least
sixty-six percent (66%) in aggregate principal amount of the Bonds then Outstanding, at the time of
the adoption of such amendatory ordinance or instrument, or the predecessors in title of such Owners,
no Owner of any Bond, whether or not such Owner shall have consented to or shall have revoked any
consent as herein provided, shall have any right or interest to object to the adoption of such
amendatory ordinance or other instrument or to object to any of the terms or provisions therein
contained or to the operation thereof or to enjoin or restrain the City from taking any action pursuant
to the provisions thereof. Any consent given by the Owner of a Bond pursuant to the provisions
thereof shall be irrevocable for a period of six (6) months from the date of the completion of the
notice above provided for and shall be conclusive and binding upon all future Owners of the same
Bond during such period. Such consent may be revoked at any time after six (6) months from the
completion of such notice, by the Owner who gave such consent or by a successor in title, by filing
notice of such revocation with the City Clerk, but such revocation shall not be effective if the Owners
of sixty-six percent (66%) in aggregate principal amount of the Bonds Outstanding as herein
provided, prior to the attempted revocation, shall have consented to and approved the amendatory
instrument referred to in such revocation.
D. Unanimous Consent. Notwithstanding anything in the foregoing provisions
contained, the terms and the provisions of this Ordinance, or of any ordinance or instrument
amendatory thereof, and the rights and the obligations of the City and of the Owners of the Bonds
may be modified or amended in any respect (except as would adversely affect the rights of the
Owners of any Parity Securities or Superior Bonds or Superior Securities) upon the adoption by the
City and upon the filing with the City Clerk of an instrument to that effect and with the consent of the
Owners of all the Outstanding Bonds, such consent to be given in the manner provided in Section
I IC hereof; and no notice to Owners of Bonds shall be required as provided in Section 11B hereof,
nor shall the time of consent be limited except as may be provided in such consent.
E. Exclusion of Bonds. At the time of any consent or of other action taken hereunder
the Registrar shall furnish to the City Clerk a certificate, upon which the City Clerk may rely,
describing all Bonds to be excluded for the purpose of consent or of other action or of any calculation
of Outstanding Bonds provided for hereunder, and, with respect to such excluded Bonds, the City
shall not be entitled or required with respect to such Bonds to give or obtain any consent or to take
any other action provided for hereunder.
33
F. Notation on Bonds. Any of the Bonds delivered after the effective date of any
action taken as provided in Section 11B hereof, or Bonds Outstanding at the effective date of such
action, may bear a notation thereon by endorsement or otherwise in form approved by the Council as
to such action; and if any such Bonds so delivered after such date does not bear such notation, then
upon demand of the Owner of any Bond Outstanding at such effective date and upon presentation of
his Bond for such purpose at the principal office of the City, suitable notation shall be made on such
Bond by the City Clerk as to any such action. If the Council so determines, new Bonds so modified
as in the opinion of the Council to conform to such action shall be prepared, executed and delivered;
and upon demand of the Owner of any Bond then Outstanding, shall be exchanged without cost to
such Owner for Bonds then Outstanding upon surrender of such Outstanding Bonds.
G. Proof of Instruments and Bonds. The fact and date of execution of any instrument
under the provisions of this Section 11, the amount and number of the Bonds owned by any Person
executing such instrument, and the date of his registering the same may be proved as provided by
Section 10E hereof.
Section 12. Miscellaneous.
A. Character of Agreement. None of the covenants, agreements, representations, or
warranties contained herein or in the Bonds shall ever impose or shall be construed as imposing any
liability, obligation, or charge against the City (except for the special funds pledged therefor) or
against the general credit of the City payable out of general funds.
B. No Pledge of Property. The payment of the Bonds is not secured by an
encumbrance, mortgage or other pledge of property of the City except for the Pledged Revenues. No
property of the City, subject to such exception with respect to the Pledged Revenues,'pledged for the
payment of the Bonds, shall be liable to be forfeited or taken in payment of the Bonds.
C. Statute of Limitations. No action or suit based upon any Bond or other obligation
of the City shall be commenced after it is barred by any statute of limitations pertaining thereto. Any
trust or fiduciary relationship between the City and the Owner of any Bond or the obligee regarding
any such obligation shall be conclusively presumed to have been repudiated on the Maturity Date or
other due date thereof unless the Bond is presented for payment or demand for payment of such other
obligation is otherwise made before the expiration of the applicable limitation period. Any moneys
from whatever source derived remaining in any fund or account reserved, pledged or otherwise held
for the payment of any such obligation, action or suit, the collection of, which has been barred, shall
revert to such fund as the Council shall provide by ordinance. Nothing herein prevents the payment
of any such Bond or other obligation after an action or suit for its collection has been barred if the
Council deems it in the best interests of the City or the public so to do and orders such payment to be
made.
D. Delegated Duties. The officers of the City are hereby authorized and directed to
enter into such agreements and take all action necessary or appropriate to effectuate the provisions of
this Ordinance and to comply with the requirements of law, including, without limitation:
(1) Printing. The printing of the Bonds or, if necessary or desirable, the
preparation of typewritten Bonds as provided herein; and
34
(2) Execution. Authentication. Registration and Delivery. The execution,
authentication and registration of the Bonds and the delivery of the Bonds to the Purchaser
pursuant to the provisions of this Ordinance.
E. Successors. Whenever herein the City is named or is referred to, such provision
shall be deemed to include any successors of the City, whether so expressed or not. All of the
covenants, stipulations, obligations and agreements by or on behalf of and other provisions for the
benefit of the City contained herein shall bind and inure to the benefit of any officer, board, district.
commission, authority, agency, instrumentality or other Person or Persons to whom or to which there
shall be transferred by or in accordance with law any right, power or duty of the City or of its
respective successors, if any, the possession of which is necessary or appropriate in order to comply
with any such covenants, stipulations, obligations, agreements or other provisions hereof.
F. Rights and Immunities. Except as herein otherwise expressly provided, nothing
herein expressed or implied is intended or shall be construed to confer upon or to give to any Person,
other than the City and the Owners from time to time of the Bonds, any right, remedy or claim under
or by reason hereof or any covenant, condition or stipulation hereof. All the covenants, stimulations,
promises and agreements herein contained by and on behalf of the City shall be for the sole and
exclusive benefit of the City and any Owner of any of the Bonds.
No recourse shall be had for the payment of the Debt Service Requirements of the
Bonds or for any claim based thereon or otherwise upon this Ordinance authorizing their issuance or
any other ordinance or instrument pertaining thereto, against any individual member of the Council,
or any officer or other agent of the City, past, present or future, either directly or indirectly through
the City, or otherwise, whether by virtue of any constitution, statute or rule of law or by the
enforcement of any penalty or otherwise, all such liability, if any, being by the acdeptance of the
Bonds and as a part of the consideration of their issuance specially waived and released.
G. Ordinance Irrepealable. This Ordinance is, and shall constitute, a legislative
measure of the City and after any of the Bonds are issued, this Ordinance shall constitute an
irrevocable contract between the City and the Owner or Owners of the Bonds; and this Ordinance,
subject to the provisions of Section 9 and Section 11 hereof, if any Bonds are in fact issued, shall be
and shall remain irrepealable until the Bonds, as to all Debt Service Requirements, shall be fully paid,
cancelled and discharged, as herein provided.
H. Ratification. 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 sale and
delivery of the Bonds for that purpose, be, and the same hereby is, ratified, approved and confirmed.
I. Repealer. All ordinances, resolutions, bylaws, orders, and other instruments, or
parts thereof, inconsistent herewith are hereby repealed to the extent only of such inconsistency. This
repealer shall not be construed to revive any ordinance, resolution, bylaw, order, or other instrument,
or part thereof, heretofore repealed.
J. Severability. If any section, subsection, paragraph, clause or other provision of
this Ordinance shall for any reason be held to be invalid or unenforceable, the invalidity or
imenforceability thereof shall not affect any of the remaining sections, subsections, paragraphs,
clauses or provisions of this Ordinance.
35
INTRODUCED, READ, APPROVED ON FIRST READING, AND ORDERED
PUBLISHED ONCE BY NUMBER AND TITLE ONLY this 19th day of November, 2002.
CITY OF FORT COLLINS, COLORADO
By:
Mayor
(CITY)
(SEAL)
ATTEST:
City Clerk
36
READ, FINALLY PASSED ON SECOND READING AND ORDERED
PUBLISHED ONCE BY NUMBER AND TITLE ONLY this 17th day of December, 2002.
CITY OF FORT COLLINS, COLORADO
By:
Mayor
(CITY)
(SEAL)
ATTEST:
City Clerk
37
ORDINANCE NO. 175, 2002
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING PROCEEDS FROM THE ISSUANCE OF CITY OF FORT COLLINS,
COLORADO, DOWNTOWN DEVELOPMENT AUTHORITY TAXABLE SUBORDINATE
TAX INCREMENT REVENUE BONDS, SERIES 2002, FOR THE PURPOSE OF MAKING
CERTAIN CAPITAL IMPROVEMENTS IN THE DOWNTOWN AREA OF FORT COLLINS
AND APPROPRIATING REVENUES IN THE TAX INCREMENT FUND
WHEREAS, on April 21, 1981, the City of Fort Collins, Colorado, adopted Ordinance
No. 46, 1981, establishing the Fort Collins, Colorado, Downtown Development Authority; and
WHEREAS, the Downtown Development Authority's Plan of Development was
approved by the City on September 8, 1981 which established the purpose of the Authority and
the types of projects in which the Authority would participate; and
WHEREAS, on June 1, 1982, a special election was held pursuant to Section 31-25-
807(b) of the Colorado Revised Statutes approving the issuance by the City of up to $25,000,000
in tax increment obligations to finance certain projects of the Downtown Development
Authority; and
WHEREAS, there is sufficient remaining bonding authorization available to fund
additional projects in the downtown area, pursuant to Ordinance No. 174, 2002, as approved by
the City Council this same date, and there is sufficient tax increment revenue available in 2002
to pay the debt service on the bonds issued by such ordinance; and
WHEREAS, through the adoption of Ordinance No. 174, 2002, of the Council of the City
of Fort Collins, the Council has issued the City of Fort Collins, Colorado, Downtown
Development Authority Taxable Subordinate Tax Increment Revenue Bonds, Series 2002 (the
"Bonds"), in the aggregate principal amount of$1,065,000; and
WHEREAS, the issuance of the Bonds, and the appropriation of the proceeds thereof, are
necessary to complete the construction of certain improvements in the downtown area of the
City; and
WHEREAS, Article V, Section 9, of the Charter of the City of Fort Collins permits the
City Council to make supplemental appropriations, in conjunction with all previous
appropriations for that fiscal year, provided that the total amount of such supplemental
appropriations, in combination with all previous appropriations for that fiscal year, does not
exceed the current estimate of actual and anticipated revenues to be received during the fiscal
year.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF
FORT COLLINS as follows:
Section 1. That, contingent upon the final sale and issuance of the Bonds, there i.
hereby appropriated for expenditure from bond .proceeds in the Downtown Development
Authority Operating Fund the amount of ONE MILLION SIXTY-FIVE THOUSAND
DOLLARS ($1,065,000) to be used for the following capital improvements in the downtown
area:
231 North College $ 50,000
Chamber of Commerce 52,000
Mason Street North 251,000
Old Town Square Play Area 12,000
Museum 25,000
Linden Street Plan 250,000
Mulberry-Lemay 85,250
River Design 15,000
Linden Loan 100,000
Downtown Strategic Plan 56,250
300 East Mountain 90,000
Baptist Church 64,000
$1,050,500
Section 2. That there is hereby appropriated for expenditure from the City of Fort
Collins, Colorado, Downtown Development Authority Tax Increment Bonds, Bond Fund the
amount of ONE MILLION SIXTY-FIVE THOUSAND DOLLARS ($1,065,000) to be used for
the payment of the Bonds.
Introduced and considered favorably on first reading and ordered published this 19th day
of November, A.D. 2002, and to be presented for final passage on the 17th day of December,
A.D. 2002.
Mayor
ATTEST:
City Clerk
Passed and adopted on final reading this 17th day of December, A.D. 2002.
Mayor
ATTEST:
City Clerk