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HomeMy WebLinkAboutD-2031-11 96th St./U.S. 421 EDA Bond/$17,580,000ORDINANCE D- 2031 -11 AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF CARMEL, INDIANA, AUTHORIZING THE ISSUANCE OF BONDS PURSUANT TO 1C 36- 7- 14 -3.5 SPONSOR: Councilor Snyder WHEREAS, the Hamilton County Redevelopment Commission "Commission did on February 25, 2000, adopt a Declaratory Resolution establishing the 96th Street -U.S. 421 Economic Development Area "Area which Resolution was amended on April 22, 2010; and WHEREAS, the City of Carmel, Indiana "City annexed all of the real estate within the Area effective July 27, 2010; and WHEREAS, the Commission, as lessee, entered into a Lease Agreement, dated as of October 21, 2010 "Original Lease with the Hamilton County Redevelopment Authority "Authority to finance the acquisition and construction of the Projects 1 -3 described in the attached Exhibit A, and to redeem certain outstanding bond anticipation notes "the Notes and WHEREAS, the Commission and the Authority intend to execute an Amendment No. 1 to Lease "Amendment to Lease to: (i) add the project described as Project 4 in the attached Exhibit A; (ii) to increase the maximum costs of the Projects; (iii) to increase the maximum lease rental; and (iv) to amend the first lease rental payment date; and WHEREAS, the Original Lease and the Amendment to Lease are hereinafter collectively referred to as the "Lease;" and WHEREAS, the Commission expects to adopt a resolution authorizing the issuance of bonds, in one or more series, "the 2011 Series A Bonds in an aggregate principal amount not to exceed Seventeen Million Five Hundred Eighty Thousand Dollars ($17,580,000) payable from Tax Increment (as defined in the Lease) for the purpose of paying the costs of Project 4 described in Exhibit A, and for the redemption of the Outstanding Notes used for fund Projects 1 -3; and WHEREAS, the Commission expects to adopt a resolution later in 2011 authorizing the issuance of bonds, in one or more series, "the 2011 Series B Bonds in an aggregate principal amount not to exceed Eight Million Five Thousand Dollars ($8,005,000) payable from Tax Increment (as defined in the Lease) for the purpose of paying the costs of Project 5 described in Exhibit A; and Page One of Three Pages WHEREAS, IC 36- 7- 14 -3.5 requires the approval of the issuance of bonds payable from Tax Increment by the Common Council of the City; and WHEREAS, the Hamilton County Income Tax Council has imposed the county option income tax under IC 6 -3.5 -6 "COLT at a rate of one percent (1.0 annually on the adjusted gross income of County taxpayers; and WHEREAS, pursuant to IC 6- 3.5 -6, the City is a recipient of a distributive share of the COLT "COIT Revenues and receives its COIT Revenues monthly from the County Auditor; and WHEREAS, on June 21, 2010, the Common Council of the City approved an Interlocal Agreement between the County and the City which set forth the Agreement among the City, the County, and the Commission concerning the funding of the Projects described in Exhibit A; and WHEREAS, all of the Projects to be funded by Tax Increment from the Area in 2010 and 2011 are to be funded from the 2011 Series A Bonds and the 2011 Series B Bonds "the Bonds and, WHEREAS, Section 25 of the Interlocal Agreement required the City to pledge Four Hundred Sixty -five Thousand Dollars ($465,000) per year of the City's County Option income Tax to cover any difference between the principal and interest on the Bonds and the semi annual Tax Increment collected from the Area. NOW, THEREFORE, BE IT ORDAINED by the Common Council of the City of Carmel, Indiana, that: Section 1. The Common Council hereby approves the issuance of the 2011 Series A Bonds by the Commission up to the maximum amount of Seventeen Million Five Hundred Eighty Thousand Dollars ($17,580,000) and the use of Tax. Increment from the Area to pay lease rentals used to pay debt service on the 2011 Series A Bonds. Section 2. The Common Council hereby approves the issuance of the 2011 Series B Bonds by the Commission up to the maximum amount of Eight Million Five Thousand Dollars ($8,005,000) and the use of Tax Increment from the Area to pay lease rentals used to pay debt service on the 2011 Series B Bonds. Section 3. The City hereby pledges the Pledged COIT to the County in an annual amount not to exceed Four Hundred Sixty -five Thousand Dollars ($465,000) to cover any shortfall between the combined debt service due on the Bonds, and Tax Increment collected from the Area. The Pledged COLT is hereby irrevocably pledged to the 2011 Series A and 2011 Series B Bonds and to any future bonds issued to refund or redeem the Bonds. Section 4. This ordinance shall be in full force and effect from and after its passage. Page Two of Three Pages -7- ADOPTED by the Common Council of the City of Carmel, Indiana this a 1 5 t day of u.. ctA.4 2011, by a vote of 7 ayes and 0 nays. V COMMON COUNCIL FOR THE CITY OF CARMEL nsticker. Presid° -o Tempore evin Rider, J• Accetturo Ronald E. Carter ATTE Diana L. Cordray, IAMC, erk- Treasurer sfi Presented by me he Mayor of the City of Carmel, Indiana this al day of 4- 2011, at ao f P.M. Approved by me, Mayor of the City of Carmel, Indiana, this oz day of ..�Qtit�u, ox 2011, at aO i2 .M. ATTEST: Diana L. Cordray, IAMC, Cleo 'reasurer Page Three of Three Pages Diana L. Cordray, IAMC, Clerk Treasurer ar es Brainard, Mayor The document was prepared by Michael A. Howard, Hamilton County Attorney EXHIBIT A Project 1 126 Street Shelborne Road to Towne Road (3 -Lane Section), including round -a -bout at Shelborne Road Project 2 Shelborne Road Improvements north of 116 Street to 126 Street and round abouts at 131 Street, 121 Street, and Shelborne intersections. Project 3 Utility relocation, construction, and construction inspection of the 106 Shelborne round -a -bout. Project 4 The reconstruction of Towne Road from 131 Street to 146 Street. Project 5 A round -a -bout at 96 Street and Towne Road including utility relocation and extensions of roads leading into and out of the round -a -bout. Year of Estimated Revenue Tax Increment 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 ?073 2024 2025 2026 2027 2028 2029 Totals 53.075,410 2,767.860 3,058.730 3,406.990 3,755,260 3.755.260 3.755,260 3,755,260 3,755,260 3,755.260 3,755,260 3,755.260 3,755,260 3.755.260 3,755.260 3,755.260 3,755,260 3,755,260 3,755,260 $68,637.890 HAMILTON COUNTY REDEVELOPMENT AUTHORITY 96t11 Street U.S. 421 TIFArea COMPARISON OF LEASE RENTALS AND ESTIMATED TAX INCREMENT Assun►es Proposed Legislation Pusses Limited City of Carmel COLT Pledge (2) Total Pledged Revenues Estimated Proposed Lease Rental Revenue Bonds of 2011 Annual TIF Combined Series A Series B Total Remaining Co.erage $3,075.410 $375,000 $0 $375,000 $2.700.410 820 °o $465,000 3,232,860 1.138,000 0 1,138.000 1.629.860 284 °0 465,000 3,523,730 1,183,000 710,000 1,893.000 1.165.730 186°0 465,000 3,871,990 1,443,000 752,000 2,195.000 1211.990 176°0 465,000 4,220,260 1,645,000 751,000 2,396,000 1.359.260 176 °0 465.000 4.220.260 1.643,000 754,000 2,39'7,000 1,358.260 176 °0 465,000 4,220,260 1,642,000 755,000 2,397,000 1,358 176 °0 465,000 4,220260 1,646,000 753,000 2,399,000 1,356.260 176% 465,000 4,220,260 1,646,000 755,000 2,401,000 1.354.260 176 °o 465,000 4,220,260 1,646,000 755,000 2,401,000 1.354.260 176% 465,000 4,220,260 1,646,000 752,000 2.398,000 1,357.260 176% 465,000 4,220,260 1,646,000 752,000 2.398,000 1.357.260 176 °0 465,000 4,220,260 1,646,000 755,000 2,401,000 1.354.260 176% 465,000 4,220,260 1.647,000 755,000 2.402,000 1.353.260 176°0 465,000 4,220,260 1.642,000 753,000 2,395,000 1,360.260 176 465,000 4,220.260 1,642,000 754,000 2.396,000 1.359.260 176% 465,000 4,220,260 1,647,000 752,000 2,399,000 1.356260 176% 465,000 4,220,260 1,644,000 752,000 2,396,000 1,359.260 176% 465,000 4,220,260 1,645,000 755,000 2,400,000 1,355,260 176 $8,370,000 $77,007,890 $28,812,000 $12,765,000 $41,577,000 $27,060.890 (1) See page 6 (2) Per an Interlocal Agreement, the City of Carmel is anticipated to pledge COIT in an amount not exceeding $465,000 per year to the extent needed to pa■ debt obligations. (3) See page 3. (4) See page 4. (3) faced oiffilltnaied Annual TlF and Pledged COIT in comparison to debt obligations. (Suhject to the comments in the attached letter dated January 20, 2011 of Umbaugh) 5 HOWARD ASSOCIATES ATTORNEYS FOR HAMILTON COUNTY AND THE CITY OF NOBLESVILLE MICHAEL A. HOWARD DARREN J. MURPHY MEMORANDUM TO: Carmel City Council FROM: Michael A. Howard DATE: January 28, 2011 SUBJECT: Ordinance No. D- 2031 -11 This Ordinance approves the Lease Agreement which is part of the financing for the 96 -421 TIF District, as described in the Interlocal Agreement with the County approved by the Carmel City Council on June 21, 2010. Under the terms of that Interlocal Agreement, there are five projects to be funded through lease rental bonds paid from 96 -421 tax increment. Those projects are as follows: Project 1 126 Street Shelborne Road to Towne Road (3 -Lane Section), including round -a -bout at Shelborne Road Project 2 Shelborne Road Improvements north of 116 Street to 126 Street and round abouts at 131 Street, 121 Street, and Shelborne intersections. Project 3 Utility relocation, construction, and construction inspection of the 106 Shelborne round -a -bout. Project 4 The reconstruction of Towne Road from 131 Street to 146 Street. Project 5 A round -a -bout at 96 Street and Towne Road including utility relocation and extensions of roads leading into and out of the round -a -bout. 694 LOGAN STREET, NOBLESVILLE, INDIANA 46060 (317) 773 -4212 •(FAX) (317) 776 -2369- Under the original Agreement, the lease rental funding of Projects 1 through 3 was to be closed in 2010 with maximum bonds in the amount of Twelve Million One Hundred Sixty Thousand Dollars ($12,160,000). Projects 4 and 5 were to be funded in 2011 with maximum bonds of Twelve Million Eight Hundred Fifty Thousand Dollars ($12,850,000). The total maximum lease payments were not to exceed Two Million Four Hundred Ninety Thousand Dollars ($2,490,000). Due to different construction time lines and some short term changes in interest rates for tax exempt bonds, the 2010 projects were funded through Notes. Projects 1 through 3 are either constructed or under contract to be completed in the Summer of 2011. Project 4 is being bid by Carmel in February of 2011. The purpose of this Ordinance is to authorize the issuance of bonds up to Seventeen Million Five Hundred Eighty Thousand Dollars ($17,580,000) to fund the Lease for Projects 1 through 4 through one Lease, leaving Project 5 to be funded later in the year through the issuance of bonds up to Eight Million Five Thousand Dollars ($8,005,000). Under the Interlocal Agreement, the total maximum amount of bonds to be funded was Twenty -five Million Ten Thousand Dollars ($25,010,000) and the maximum annual lease rental was to be Two Million Four Hundred Ninety Thousand Dollars ($2,490,000). We now anticipate the maximum bonds needed to fund all five projects could rise as high as Twenty -five Million Five Hundred Eighty -five Thousand Dollars ($25,585,000), though we anticipate the competitive bid market to still allow us to bring the projects in under the previous maximum. Under the most recent projections by Umbaugh shown in the attached Page 5 of their current report, the projected annual lease rental amounts will be Two Million Four Hundred Two Thousand Dollars ($2,402,000), which is less than the total amount in the Interlocal Agreement. The Ordinance also pledges up to Four Hundred Sixty-five Thousand Dollars ($465,000) per year of the City's COIT to the debt service on the 2011 Series A and 2011 Series B Bonds as required by Section 25 of the Interlocal Agreement. That guarantee is only to assure adequare debt coverage on the Bonds and will never be used as long as the tax increment from the Area exceeds the bond payments. You can see on the attached Page 5 that the maximum annual debt on both series of Bonds will not exceed Two Million Four Hundred Two Thousand Dollars ($2,402,000) and all but two of the years, projected excess annual increment is over One Million Three Hundred Thousand Dollars ($1,300,000). I will be present at your meeting to answer all questions on the status of the projects and the Ordinance.