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HomeMy WebLinkAbout064 - 06/07/2011 - APPROPRIATING UNANTICIPATED GRANT REVENUE AND PRIOR YEAR RESERVES FOR THE NORTH COLLEGE AVENUE IMPRO ORDINANCE NO. 064, 2011 OF THE COUNCIL OF THE CITY OF FORT COLLINS APPROPRIATING UNANTICIPATED GRANT REVENUE AND PRIOR YEAR RESERVES FOR THE NORTH COLLEGE AVENUE IMPROVEMENTS - VINE DRIVE TO CONIFER PROJECT, AND APPROVING A RELATED REIMBURSEMENT AGREEMENT AND PROMISSORY NOTE WHEREAS,in 2005,Fort Collins voters passed a ballot measure establishing a one-quarter cent sales tax to fund the capital projects identified in the"Building on Basics" ("BOB")program; and WHEREAS, the North College Avenue Improvements - Vine Drive to Conifer project(the "Project") is a BOB project; and WHEREAS, the Project improvements will include a two inch asphalt overlay, the construction of various urban design elements, an eight foot on-street bike lane, a landscaped parkway, shared use paths, the definition and consolidation of property access routes for local business throughout the corridor, an updated stormwater system including water quality treatment ponds, and safety improvements at the Conifer and Hickory Intersection; and WHEREAS;the current estimated cost of design,right-of-way acquisition,and construction of the Project is approximately $11.2 million; and WHEREAS,the City has previously appropriated approximately$7.5 million in funding for the Project from the following sources:BOB($4.8 million),residual truck route funds($1.8 million), and state and federal grants ($0.9 million); and WHEREAS, the City has received a total of$1,001,000 in additional grant funds from the Colorado Department of Transportation that includes $171,000 of Transportation Enhancement funds, $530,000 of Surface Transportation Program funds, and $300,000 of federal and state resurfacing funds; and WHEREAS, an additional $2.7 million is available in the Capital Project Fund, Building Community Choices ("BCC") residual prior year reserves for the Project, and City staff has recommended that the City Council utilize these funds to complete the Project, with the understanding that this amount will be repaid to the City by the Fort Collins Urban Renewal Authority ("Authority"); and WHEREAS, the Board of Commissioners of the Urban Renewal Authority will,this same date, consider the execution of a reimbursement agreement and promissory note to evidence its commitment to repay the City this advance of$2.7 million for the Project; and WHEREAS,City staff has prepared a proposed promissory note("the Note"),attached hereto as Exhibit A, and an agreement in the form entitled"Reimbursement Agreement Between the City of Fort Collins and the Fort Collins Urban Renewal Authority to Help Defray the Cost of the North College Improvements-Vine Drive to Conifer Project("the Reimbursement Agreement"),attached hereto as Exhibit B; and WHEREAS,Article V, Section 9 of the City Charter permits the City Council to appropriate by ordinance at any time during the fiscal year such funds for expenditure as may be available from reserves accumulated in prior years, notwithstanding that such reserves were not previously appropriated; and WHEREAS, Article V, Section 9, of the City Charter permits the City Council to make supplemental appropriations by ordinance at any time during the 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; and WHEREAS, City staff has determined that the appropriation of the grant revenue as described herein will not cause the total amount appropriated in the Capital Projects Fund to exceed the current estimate of actual and anticipated revenues to be received in that fund during any fiscal year. NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT COLLINS as follows: Section 1. That there is hereby appropriated from unanticipated federal and state grant revenue in the Capital Projects Fund the sum of ONE MILLION ONE THOUSAND DOLLARS ($1,001,000) for expenditure on the Project. Section 2. That there is hereby appropriated for expenditure on the Project from prior year reserves in the Capital Projects Fund,Building Community Choices reserves the sum of TWO MILLION SEVEN HUNDRED THOUSAND DOLLARS ($2,700,000)to be repaid to the City by the Urban Renewal Authority pursuant to the Note and Reimbursement Agreement. Section 3. That the Note and Reimbursement Agreement are hereby approved by the City Council on substantially the terms and conditions contained therein,subject to modifications in form or substance as the Mayor may, in consultation with the City Attorney, deem necessary to protect the interests of the City. -2- Introduced, considered favorably on first reading, and ordered published this 17th day of May, A.D. 2011, and to be presented for final passage on the 7th day of June, A.D. 2011. OF F OR T CO >:• ••ll Mayo — ATTEST: SEAL .N UAL City Clerk OLORPO Passed and adopted on final reading on the 7th day of June, A.D. 2011. May jr ATTEST: foRr co�`,2 SEAL City Clerk •:, COLORPO -3- EXHIBIT A PROMISSORY NOTE $2,700,000 June 2011 FOR VALUE RECEIVED, FORT COLLINS URBAN RENEWAL AUTHORITY, a public body corporate and politic of the State of Colorado ("Borrower'), promises to pay to the order of THE CITY OF FORT COLLINS, COLORADO, a municipal corporation ("Lender"), at its office at 300 LaPorte Avenue, Fort Collins, Colorado 80524, in lawful money of the United States of America the principal amount not to exceed Two Million Seven Hundred Thousand Dollars ($2,700,000). This Promissory Note is issued pursuant to the Reimbursement Agreement between the City of Fort Collins and The Fort Collins Urban Renewal Authority to Help Defray the Cost of the North College Avenue Improvements - Vine Drive to Conifer Project dated June J 2011, between Borrower and Lender (the "Agreement"). Capitalized terms used herein but not defined herein have the meanings given such terms in the Agreement. The obligations of Borrower evidenced by this Promissory Note are payable in accordance with the terms and conditions of the Agreement. The rate of interest bome by this Promissory Note is a fixed rate equal to % per annum ("Interest Rate"). Final payment of all unpaid Principal and accrued interest will be due and payable on the maturity date. The annual interest rate of this Promissory Note is computed on a 360 day year basis,multiplied by the actual number of days elapsed. This Promissory Note shall mature on the December 31, 2029. At such time all unpaid principal, interest, default interest, fees and charges owing under this Note shall be deemed payable in full. Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued interest; then to principal; then to any late charges; and then to any unpaid collection costs. If Lender refers this Note to an attorney for collection or seeks legal advice following a default beyond all cure periods alleged under this Note, or the Lender is the prevailing party in any action instituted on this Note, or if any other judicial or non-judicial action, suit or proceeding is instituted by Lender or any future holder of this Note, and an attorney is employed by Lender to appear in any such action or proceeding, or to reclaim, seek relief from a judicial or statutory stay, sequester, protect, preserve or enforce Lender's interest in this Note, the Agreement or any other security for this Note (including, but not limited to, proceedings under federal bankruptcy law or in connection with any state or federal tax lien), then Borrower promises to pay reasonable attorneys' fees and reasonable costs and expenses incurred by Lender and/or its attorney in connection with the above-mentioned events. If not paid within ten (10) days after such fees become due and written demand for payment is made, such amount shall be due on demand or may be added to the principal, at the Lender's discretion. Should any payment or installment hereunder be not paid when the same becomes due and payable, Borrower recognizes that the Lender will incur extra expenses for both the administrative cost of handling delinquent payments and the cost of funds incurred by Lender after such due date as a result of not having received such payment when due. Therefore, Borrower shall, in such event, without further notice, and without prejudice to the right of Lender to collect any other amounts provided to be paid herein, including default interest or to declare a default hereunder, pay to Lender to cover such expenses incurred as a result of any installment payment due being not received within ten (10) days of its due date, a "late charge" of five percent(5%) of the amount of such delinquent payment. Except as otherwise provided herein, the Borrower waives presentment and demand for payment, notice of acceleration or of maturity, protest and notice of protest and nonpayment, bringing of suit and diligence in taking any action to collect sums owing hereunder and agrees that its liability on this Note shall not be affected by any release or change in any security for the payment of this Note or release of anyone liable hereunder. No extension of time for the payment of this Note, or any installment or other modification of the terms made by the Lender with any person now or hereafter liable for the payment of this Note, shall affect the original liability under this Note of the Borrower, even provided the Borrower is a party to such agreement. In no event whatsoever shall the amount paid, or agreed to be paid, to the holder of this Note for the use, forbearance or retention of the money to be advanced hereunder ("Interest") exceed the maximum amount permissible under applicable law. If the performance or fulfillment of any provision hereof or of the Agreement or any other document between Borrower and the Lender of this Note shall result in Interest exceeding the limit for interest prescribed by law, then the amount of such Interest shall be reduced to such limit. If, from any circumstance whatsoever, the Lender of this Note should receive as Interest, an amount which would exceed the highest lawful rate, the amount which would be excessive Interest shall be applied to the reduction of the principal balance owing (or, at the option of the Lender, be paid over to Borrower) and not to the payment of Interest. If any provision hereof or any provision of the Agreement shall, for any reason and to any extent, be invalid or unenforceable, then the remainder of the document or instrument in which such provision is contained shall not be affected thereby but instead shall be enforceable to the maximum extent permitted by law. Borrower and Lender hereby knowingly, voluntarily, and intentionally waive any rights they may have to a trial by jury in respect of any litigation based hereon or arising out of, under or in connection with this note or any course of conduct, course of dealing, statements (whether oral or written) or actions of the other party. - 2 - This Promissory Note shall be construed in accordance with the laws of the State of Colorado. IN WITNESS WHEREOF, Borrower has duly executed this Promissory Note as of the day and year first above written. BORROWER: FORT COLLINS URBAN RENEWAL AUTHORITY, a public body corporate and politic of the State of Colorado. By: Executive Director - 3 - ' EXHIBIT B REIMBURSEMENT AGREEMENT BETWEEN THE CITY OF FORT COLLINS AND THE FORT COLLINS URBAN RENEWAL AUTHORITY TO HELP DEFRAY THE COST OF THE NORTH COLLEGE AVENUE IMPROVEMENTS -VINE DRIVE TO CONIFER PROJECT THIS REIMBURSEMENT AGREEMENT (the "Agreement") is made this_day of June, 2011,by and between the CITY OF FORT COLLINS, COLORADO, a municipal corporation, (the "City"), and FORT COLLINS URBAN RENEWAL AUTHORITY, a public body corporate and politic of the State of Colorado, (the "URA"). RECITALS A. ; The URA is an urban renewal authority for the City, created pursuant to Colorado Revised Statutes Part 1 of Title 31, Article 25, as amended (the "Act'). B. The URA was created on January 5, 1982 to prevent and eliminate conditions related to certain"blight factors" in the community. The Act gives the URA broad powers to carry out its statutory mandate. Included are the powers to enter into contracts, borrow or lend funds and to acquire property, among others. Urban renewal projects may be financed in a variety of ways and urban renewal authorities are authorized to borrow money, issue bonds, and accept grants from public or private sources. C. By Resolution 2004-151,the City Council for the City(the"City Council")found and declared the area described therein (the "Area") to be a blighted area as defined in the Act, and appropriate for inclusion in an urban renewal project. D. By Resolution 2004-152, the City Council made findings and approved the urban renewal plan (the "Plan") for the North College Avenue Corridor. E. The City is undertaking a capital improvement project known as the North College Avenue Improvements-Vine Drive to Conifer project(the"Project"). To facilitate the Project,and because of the substantial benefits that the Project will bestow on the URA, the URA is willing to reimburse the City for costs associated with the Project in the amount of Two Million Seven Hundred Thousand Dollars ($2,700,000). F. The costs of the Project that the URA will help defray include the design,installation, construction and financing of a two inch asphalt overlay,the construction of various urban design elements,an eight foot on-street bike lane, a landscaped parkway,shared use paths, the definition and consolidation of property access routes for local business throughout the corridor,an updated storm system including water quality treatment ponds,and safety improvements at the Conifer and Hickory Intersection in the Area. 1 G. The City and URA are willing to enter into this Agreement on the terms and conditions hereinafter set forth. H. Tax increment financing for the Project is specifically permitted pursuant to Section 7 of the Plan. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties agree as follows: Section 1. The Reimbursement Amount. After the effective date of this Agreement(the "Effective Date"), the adoption of the required ordinances and resolutions by the City and URA, and the execution of a promissory note and other documents as may reasonably be required, the URA will reimburse the City for a sum not to exceed Two Million Seven Hundred Thousand Dollars ($2,700,000). Section 2. Interest. Interest on the Reimbursement Amount will accrue at a rate equal to Section 3. Payment. The Reimbursement Amount and accrued interest will be due and payable by the URA to the City asset forth in the payment schedule contained on Exhibit A, attached and incorporated into this Agreement. All unpaid principal of the Reimbursement Amount, interest, default interest, fees and charges shall mature on the December 31, 2029. The URA, in its sole discretion, may prepay all or any portion of the Reimbursement Amount at any time and that prepayment will be without any prepayment penalty. If a prepayment is made, the funds will go first toward any interest which has accrued and the balance then applied to the reduction of principal. Section 4. Tracking. The URA agrees to maintain a separate payable line-item within its accounting system to track the Reimbursement Amount. Section 5. Alternative Financing. The Parties contemplate that at some point in the future the URA will obtain alternative financing(e.g.bond financing)and will diligently pursue that financing with a goal to reducing the outstanding balance of the Reimbursement Amount. Section 6. Notice. Any notice required to be delivered in writing will be accomplished by personal delivery or mailing postage prepaid by the United States Postal Service, or other commercial carrier to the following addresses: If to the City: City of Fort Collins Director of Finance PO Box 580 Fort Collins, CO 80522-0580 i 2 If to the URA: Fort Collins Urban Renewal Authority Director of Advance Planning PO Box 580 Fort Collins, CO 80522-0580. Section 7. Entire Agreement. This Agreement will be construed according to its fair meaning,as if prepared by both Parties,and constitutes the entire understanding and agreement of the Parties related to the matters addressed in this Agreement. CITY: CITY OF FORT COLLINS, COLORADO, a municipal corporation By: Karen Weitkunat, Mayor ATTEST: By: Wanda Krajiceck, City Clerk APPROVED AS TO FORM: By: Assistant City Attorney URA: FORT COLLINS URBAN RENEWAL AUTHORITY, a public body corporate and politic of the State of Colorado. By: Executive Director 3 EXHIBIT A TO THE REIMBURSEMENT AGREEMENT Urban Renewal Authority North College Improvements Phase 2 (Vine to Conifer) Reimbursement Agreement to City from the URA Reimbursement Amount 2,700,000.00 Istart Date I 1-Jul-12 ` Interest Rate 3.920% IMatures 1 31-Dec-29 Years 1 17 1/2 Time in Years Date Payment Interest Principal Balance - 1-Jul-12 2,700,000.00 0.5 31-Dec-12 - - 2,700,000.00 1.5 31-Dec-13 158,760.00 158,760.00 - 2,700,000.00 2.5 31-Dec-14 230,348.61 105,840.00 124,508.61 2,575,491.39 3.5 31-Dec-15 230,348.61 100,959.26 129,389.35 2,446,102.04 4.5 31-Dec-16 230,348.61 95,887.20 134,461.41 2,311,640.63 5.5 31-Dec-17 230,348.61 90,616.31 139,732.30 2,171,908.33 6.5 31-Dec-18 230,348.61 85,138.81 145,209.80 2,026,698.53 7.5 31-Dec-19 230,348.61 79,446.58 150,902.03 1,875,796.50 8.5 31-Dec-20 230,348.61 73,531.22 156,817.39 1,718,979.11 9.5 31-Dec-21 230,348.61 67,383.98 162,964.63 1,556,014.48 10.5 31-Dec-22 230,348.61 60,995.77 169,352.84 1,386,661.64 11.5, 31-Dec-23 230,348.61 54,357.14 175,991.47 1,210,670.17 12.5 31-Dec-24 230,348.61 47,458.27 182,890.34 1,027,779.83 13.5 31-Dec-25 230,348.61 40,288.97 190,059.64 837,720.19 14.5 31-Dec-26 230,348.61 32,838.63 197,509.98 640,210.21 15.5 31-Dec-27 230,348.61 25,096.24 205,252.37 434,957.84 16.5 31-Dec-28 230,348.61 17,050.35 213,298.26 221,659.58 17.5 31-Dec-29 230,348.64 8,689.06 221,659.58 - 3,844,337.79 1,144,337.79 2,700,000.00 Dates and rates are preliminary. Specifics will be set after the loan is authorized.