HomeMy WebLinkAbout074 - 07/05/2011 - APPROPRIATING FUNDS FROM THE CITYS GENERAL FUND RESERVES FOR TRANSFER TO THE FORT COLLINS URBAN RENE ORDINANCE NO. 074, 2011
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROPRIATING FUNDS FROM THE CITY'S GENERAL FUND RESERVES FOR
TRANSFER TO THE FORT COLLINS URBAN RENEWAL AUTHORITY
FOR THE PURPOSE OF PROVIDING A LOAN FOR THE
KAUFMAN AND ROBINSON, INC. PROJECT AT 1330 BLUE SPRUCE
WHEREAS,the Fort Collins Urban Renewal Authority(the"URA'')was created on January
5, 1982 to prevent and eliminate conditions related to certain blight factors in the City; and
WHEREAS, the City Council, by Resolution 2004-152, has made findings required by
Colorado Revised Statutes, Part 1 of Title 31, Article 25 and declared the area described in
Resolution 2004-151 as blighted and approved the Urban Renewal Plan for the North College
Avenue Corridor (the "Plan"); and
WHEREAS,on August 15,2006,the City Council adopted Resolution 2006-082 authorizing
an intergovernmental agreement between the City and the URA whereby the City will provide
support services to the URA and will advance funds to the URA so long as the advance of such funds
is evidenced in writing by a promissory note; and
WHEREAS, Kaufman and Robinson, Inc. had proposed the construction of a new 16,000
square foot commercial building on a parcel of land approximately 1.76 acres in size located at 1330
Blue Spruce (the "Project"); and
WHEREAS, the Project included the construction and installation of public infrastructure
such as street and stormwater infrastructure improvements within the North College Urban Renewal
Area; and
WHEREAS, on June 2, 2009, the Board of Commissioners of the URA (the "Board")
adopted Resolution 2009-018, approving the provision of financial assistance in the amount of
$215,000 for the Project; and
WHEREAS, on June 2, 2009, the Board suggested that additional financial support might
be considered if more green building technologies were incorporated in the Project; and
WHEREAS, on December 1, 2009, the Board adopted Resolution 2009-022 approving up
to an additional $54,000 in financial assistance due to additional green building technologies that
were being added to the Project; and
WHEREAS, the Project has been completed; and
WHEREAS, the total cost of the Project is $1,600,000 and the cost of the public
infrastructure improvements is $192,891; and
WHEREAS, the URA will not have sufficient tax increment revenues in 2011 to fund its
contribution to the Project; and
WHEREAS, City staff recommends that the City lend the URA the funds needed for that
purpose; and
WHEREAS,staff has prepared a proposed promissory note(the"Note")and loan agreement
entitled "Loan Agreement Between the City of Fort Collins and the Fort Collins Urban Renewal
URA for the Kaufman and Robinson, Inc. New Building at 1330 Blue Spruce Project" (the "Loan
Agreement") attached hereto as Exhibit"A" and incorporated herein by this reference; and
WHEREAS,there are sufficient prior year reserves in the City's General Fund to fund a loan
to the URA for the purpose of funding the Project street and stormwater infrastructure
improvements; 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, the City Manager recommends funding the loan to the URA from the General
Fund and it is the desire of City Council to do so.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF FORT
COLLINS as follows:
Section 1. That there is hereby appropriated from General Fund Reserves the sum of
ONE HUNDRED NINETY TWO THOUSAND EIGHT HUNDRED NINETY ONE DOLLARS
($192,891) for expenditure as a loan to the Fort Collins Urban Renewal Authority.
Section 2. That the use of this $192,891 in General Fund Reserves for the purpose of
funding a loan to the URA,according to the terms and conditions of the Note and Loan Agreement,
will provide necessary improvements to public-infrastructure and will be beneficial for all City
citizens.
Section 3. That the Loan Agreement is hereby approved,and the Mayor is authorized to
execute said agreement, subject to such modifications in form or substance as the Mayor may, in
consultation with the City Attorney, deem desirable and necessary to protect the City's interests.
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Introduced,considered favorably on first reading,and ordered published this 7th day of June,
A.D. 2011, and to be presented for final passage on the 5th day of July, A.D. 2011.
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Passed and adopted on final reading on the 5th day of July, A.D:2011.
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EXHIBIT A
LOAN AGREEMENT BETWEEN THE CITY OF FORT COLLINS
AND THE FORT COLLINS URBAN RENEWAL AUTHORITY
FOR FUNDING THE
KAUFMAN AND ROBINSON, INC. PROJECT AT 1330 BLUE SPRUCE PROJECT
THIS LOAN AGREEMENT (the "Agreement") made this day of July, 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 'Borrower").
RECITALS
A. Borrower 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. Borrower was created on January 5, 1982 to prevent and eliminate conditions related to certain "blight factors" in the community. The Act gives the Borrower 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. By the Intergovernmental Agreement approved by City of Fort Collins
Resolution 2006-082, the City may advance funds to the Borrower in support of its activities so
long as any such advance of funds is evidenced in writing in the form of a loan memorialized by
a promissory note, which transaction shall not be valid until first having been approved by both
the City Council and the URA Commission.
F. Borrower will incur certain costs relating to the design, installation, construction
and financing of public improvements in the Area (the "Project") and has requested and applied
to City for a loan to provide funding for these costs not to exceed One Hundred Ninety Two
Thousand Eight Hundred Ninety One Dollars ($192,891) and City is willing to make a loan on
the terms and conditions hereinafter set forth(the "Loan").
G. Tax increment financing for the Project is specifically permitted pursuant to
Section 7 of the Plan.
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NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the parties agree as follows:
Section 1. The Loan. After the effective date of this Agreement(the "Effective
Date"), the adoption of the required resolutions by the City and Borrower, and the execution of
a promissory note and other documents as may reasonably be required the City will loan the
Borrower the sum of One Hundred Ninety Two Thousand Eight Hundred Ninety One Dollars
($192,891) from the City's General Fund (the "Loan').
Section 2. Interest. Interest on the Loan will accrue at a rate equal to %.
Section 3. Payment. Principal and accrued interest will be due and payable by the
Borrower to the City as follows:
For years 0 through 4 (Annual Payment Term): there will be annual payments of
principal and interest.
For the anniversary of the 5th Effective Date: there will be a lump sum payment of
all remaining principal and interest.
The payment schedule, under which Borrower must make its payments, is in Exhibit A,
attached and incorporated into this Agreement.
Borrower, in its sole discretion, may prepay all or any portion of the Loan 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. Borrower agrees to maintain a separate payable line-item
within its accounting system to track the Loan.
Section 5. Alternative Financing. The Parties contemplate that at some point in the
future the Borrower will obtain alternative financing (e.g. bond financing) and will diligently
pursue that financing with a goal to reducing the outstanding balance of the Loan.
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
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If to the Borrower
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:
Douglas P. Hutchinson, Mayor
ATTEST:
By:
Wanda Krajiceck, City Clerk
APPROVED AS TO FORM:
By:
Assistant City Attorney
BORROWER:
FORT COLLINS URBAN RENEWAL
AUTHORITY, a public body corporate and politic
of the State of Colorado.
By:
Executive Director
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EXHIBIT A
2011 City Loan to URA for Kaufman and Robinson
Start Date 15-July-11
Amount $192,891.00
Years 5
Interest 3.348% **
Payment
Payment# Date Amount Interest Principal Balance
31-July-11 192,891.00
1 31-July-12 6,457.99 6,457.99 - 192,891.00
2 31-July-13 6,457.99 6,457.99 - 192,891.00
3 31-July-14 6,457.99 6,457.99 - 192,891.00
4 31-July-15 6,457.99 6,457.99 - 192,891.00
5 31-July-21 199,348.99 6,457.99 192,891.00 -
225,180.95 32,289.95 192,891.00
*-Start date will be set when loan agreement is authorized.
Rate will be established the day after loan agreement is authorized.
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PROMISSORY NOTE
$192,891 12011
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 of One Hundred Ninety Two Thousand Eight Hundred and Ninety One
Dollars ($192,891). This Promissory Note is issued pursuant to the Loan Agreement between
the City of Fort Collins and The Fort Collins Urban Renewal Authority for Funding the
Kaufman and Robinson, Inc. New Building at 1330 Blue Spruce Project dated July J 2011,
between Borrower and Lender (the "Loan Agreement"). Capitalized terms used herein but not
defined herein have the meanings given such terms in the Loan Agreement. The obligations of
Borrower evidenced by this Promissory Note are payable in accordance with the terms and
conditions of the Loan Agreement.
The rate of interest borne 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.
The Loan may be drawn 100%upon execution of the Loan Documents, or in part from
time to time,but not more frequently than monthly.
This Promissory Note shall mature on the tenth anniversary of the Effective Date. 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 Loan Documents 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 loaned hereunder ("Interest")
exceed the maximum amount permissible under applicable law. If the performance or
fulfillment of any provision hereof or of any of the Loan Documents or any agreement 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 of the Loan Documents 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 and any of the other Loan Documents 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.
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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
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