The URL can be used to link to this page

Home My WebLink About06/05/2012 04F Amending Resolutions R-210-060 and R-2011-143; Interfund Loan Replacing Prior Authorization BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. il ; For Meeting of: June 5, 2012 ITEM TITLE: Resolution amending Resolution No. R- 2010 -60 adopted May 18, 2010, and Resolution No. R- 2011 -143 adopted September 6, 2011, and authorizing an Interfund Loan from the Equipment Rental Fund to the Parks Capital Fund in an amount not to exceed $600,000 in replacement of the prior authorization to draw such amount from the City's line of credit SUBMITTED BY: Cindy Epperson, Director of Finance and Budget Chris Waarvick, Director of Public Works CONTACT Tara Lewis, Financial Services Manager, 576 -6639 PERSON /TELEPHONE: Ken Wilkinson, Parks and Recreation Manager, 575 -6020 SUMMARY EXPLANATION: In 2010 when the Kiwanis Park Improvement Project got underway, it was anticipated that the portion to be funded by the City would be borrowed through a draw on the City's existing line of credit. This line of credit is due to expire in June 2012. New regulations that will become effective within the next few years will require banks to carry compensating balances on undrawn portions of credit lines causing this form of financing to become fairly expensive relative to other financing vehicles. Moreover, interest rates to be earned on external investment securities available to the City are at an all time low. By investing the excess cash of the Equipment Rental fund in a short term loan to Parks Capital, the interest earned and paid respectively will be at a better rate than is available in the current short term investing and financing marketplaces. Therefore, it is in its best interest of both funds and the City in general to withdraw the permission granted in Resolution R- 2010 -60 as amended by Resolution R- 2011 -143 to draw up to $600,000 on the City's line of credit and instead to authorize an Interfund Loan of not to exceed $600,000 for the completion of the City funded portion of the Kiwanis Park Improvement Project. Draws will be made only as needed and repayments will be made using REET 1 revenue as originally authorized by the Council as a means of servicing this debt. Resolution X Ordinance Other (specify) Contract: Mail to: Contract Term: Amount: Expiration Date: Insurance Required? No Funding Source: Phone: APPROVED FOR SUBMITTAL: C Manager ...;4 STAFF RECOMMENDATION: Adopt resolution BOARD /COMMISSION RECOMMENDATION: ATTACHMENTS: Click to download Resolution. 2012- 0 Kiwanis Park Prior Resolutions - Financing • • RESOLUTION NO. R 2012 - A RESOLUTION amending Resolution No. R- 2010 -60 adopted May 18, 2010, and amending Resolution No. R- 2011 -143 adopted September 6, 2011, and authorizing an Interfund Loan from the Equipment Rental Fund to the Parks Capital Fund in an amount not to exceed $600,000 in replacement of the prior authorization to draw such amount from the City's line of credit. WHEREAS, the City Council of the City of Yakima, Washington (the "City ") adopted Resolution No. R- 2010 -60 on May 18, 2010 authorizing one or more dr in the aggregate principal amount of not to exceed $500,000 on the City's Limited Tax General Obligation Bond, 1997 (Key Bank Line of Credit) (the "Bond ") to pay the costs of the Project as set forth in Resolution No. R- 2010 -60; and WHEREAS, the City Council adopted Resolution No. R- 2011 -143 on September 6, 2011 amending Resolution No. R- 2010 -60 to change the maximum amount of draws under the Bond to $600,000 to pay the costs of the Project; and WHEREAS, the Bond matures on June 1, 2012; and WHEREAS, upcoming banking regulations requiring compensating balances on undrawn debt amounts will make line of credit borrowing costs rise significantly in the near future; and WHEREAS, the Equipment Rental Fund has sufficient resources available for investment to make the interfund loan authorized by this Resolution; and WHEREAS, to provide the most efficient financing for the remaining part of the Project the City Council hereby finds it in the best interest of the City to withdraw the permission granted in Resolution No. R- 2010 -60 as amended by Resolution No. R- 2011 -143 to draw on the Bond and instead to authorize an Interfund Loan in the aggregate principal amount of not to exceed $600,000 to complete the financing for the Project; now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: A loan of up to $600,000 may be borrowed from the Equipment Rental Fund in whole or in part as it becomes necessary to complete the Project. The interest rate shall be based on the current 1 -Month LIBOR rate plus 1.0% at the time of each draw. The loan shall be repaid from Fund 342, REET 1 in payments totaling approximately $120,000 per year. The term of the loan shall not exceed 5 years. ADOPTED BY THE CITY COUNCIL this 5th day of June, 2012. Micah Cawley, Mayor ATTEST: City Clerk RESOLUTION NO. R- 2010 -60 A RESOLUTION of the City of Yakima, Washington, authorizing one or more draws in the aggregate principal amount of not to exceed $500,000 from the City's line of credit to fund costs associated with the acquisition, construction, redevelopment, and improvement of Kiwanis Park. • WHEREAS, the City Council of the City of Yakima, Washington (the "City ") passed Ordinance No. 97 -29 on May 6, 1997 establishing a .line of credit in the aggregate principal amount of not to exceed $5,000,000 to provide funds for various City capital projects; and WHEREAS, the City issued its Limited Tax General Obligation Bond, 1997 (KeyBank Line of Credit), dated June 9, 1997 (the "Bond "), to KeyBank National Association (the "Bank ") ' . to evidence the line of credit; and WHEREAS, Ordinance No. 2002 -31 of the City, passed on May 21, 2002, amended certain terms of Ordinance No. 97 -29, including extending the maturity date of the Bond. until June 1, 200.7; and WHEREAS, Ordinance No. 2007-19 of the City, passed on April 17, 2007, further amended certain terms of Ordinance No. 97 -29, including extending the maturity date of the Bond until June 1, 2012; and WHEREAS, Section 11 of Ordinance No. 97 -29, as amended by Ordinance No. 2002 -31 • and Ordinance No. 2007 -19 (together, the "Ordinance "), authorizes the City to draw on the Bond • in a minimum amount of $10,000 subject to the approving legal opinion of bond counsel; and WHEREAS, the City wishes to acquire, construct, redevelop and make certain capital improvements to Kiwanis Park, a City -owned community park (the "Project "); and WHEREAS, to provide interim financing for costs of the Project, the City hereby finds it in the best interest of the City to authorize one or more draws on the Bond in the aggregate principal amount of not to exceed $500,000 as further provided herein; NOW, THEREFORE, 'BE IT RESOLVED BY the City of Yakima, Washington, as follows: Section 1. Authorization of Draws. In accordance with Section 11 of Ordinance No. 97 -29, as amended (the "Ordinance "), the City Council hereby authorizes one or more draws on the City's Limited Tax General Obligation Bond, 1997 (KeyBank Line of Credit) (the "Bond ") in the aggregate principal amount of not to exceed $500,000, to provide funds for the Project. The outstanding principal balance of the draws shall bear interest and shall be payable as provided in the Ordinance. All proceeds received from draws on the Bond pursuant to this authorization shall be deposited into the fund or account designated by the Director of Finance and Budget and used to finance costs of the Project. The City hereby authorizes the Director of Finance and Budget t� take any actions and execute such documents as may be necessary and required by the Bank to complete such draws and to carry out the terms of this resolution. _ Section 2. General Authorization; Ratification of Prior Acts. The Director of Finance and Budget and other appropriate officers of -the City are authorized to take any actions and to execute documents as in their judgment may be necessary or desirable in order to carry out the • terms of, and complete the transactions contemplated by, this resolution. All acts taken pursuant to the authority of this resolution but prior to its effective date are hereby ratified. Section 3. This resolution shall be in effect from and after its adoption in accordance with law. ADOPTED at a regular meeting of the City Council of the City of Yakima, Washington, this 18 day of May 2010. • 11 () Micah Cawley, Mayor ATTEST: • City Clerk t 0k1A y • 5? 0•J e APPROVED AS TO FORM: S1-111A G o • City Attorney • • • -2- P:N20358 De\20358_oNY • CERTIFICATE I, the undersigned, Clerk of the City of Yakima, Washington (the "City "), and keeper of the records of the City Council (the "Council "), DO HEREBY CERTIFY: 1. That the attached Resolution No. R -2010- 470 is a true and correct copy of a resolution of the City Council, as finally adopted at a regular meeting of the Council held on the 1 8 th day of May, 2010, and duly recorded in my office. 2. That said meeting was duly convened and held in all respects in accordance with law, and to the extent required by law, due and proper notice of such meeting was given; that a legal quorum was present throughout the meeting and a legally sufficient number of members of the Council voted in the proper manner for the passage of said Resolution; that all other requirements and proceedings incident to the proper adoption of said Resolution have been fully fulfilled, carried out and otherwise observed; and that I am authorized to execute this certificate. • IN WITNESS WHEREOF, I have hereunto set my hand this I d- day of May, 2010, / City Cl. rk (SEAL K1 ®-srav • :.7 • • RESOLUTION NO. R -2011 -143 A RESOLUTION amending Resolution No. R- 2010 -60 adopted May 18, 2010, and authorizing one or more draws in the aggregate principal amount of not to exceed $600,000 from the City's line of credit to fund costs.associated with the acquisition, construction, redevelopment, and improvement of Upper Kiwanis Park. • WHEREAS, the City Council of the City of Yakima, Washington (the "City ") adopted Resolution No. R- 2010 -60 on May 18, 2010 authorizing one or more draws in the aggregate principal amount of not to exceed $500,000 on the City's Limited Tax General Obligation Bond, 1997 (KeyBank Line of Credit) (the "Bond ") to pay the costs of the Project as set forth in Resolution No. R- 2010 -60; and WHEREAS, the lowest bid for the Project is over the budgeted amount and the City wishes to increase the aggregate principal amount of draws on the Bond for the Project to not to exceed $600,000, now therefore, BE IT RESOLVED BY THE CITY COUNCIL. OF THE CITY OF YAKIMA: Section 1. Amendment of Resolution No. R- 2010 -60. Section 1 of Resolution No. R- 2010 -60 is hereby amended to read as follows (additions are underlined and deletions are stricken through): Section 1. Authorization of Draws. In accordance with Section 11 of Ordinance No. 97 -29, as amended (the "Ordinance "), the City Council hereby authorizes one or more draws on the City's Limited Tax General Obligation Bond, 1997 (KeyBank Line of Credit) (the "Bond ") in the aggregate principal amount of not to exceed $600,000 $500,000, to provide funds for the Project. The • outstanding principal balance of the draws shall bear interest and shall be payable as provided in the Ordinance. All proceeds received from draws on the Bond pursuant to this authorization shall be deposited into the fund or account designated by the Director of Finance and Budget and used to finance costs of the Project. The City hereby authorizes the Director of Finance and Budget to take any actions and execute such documents as may be necessary and required by the Bank to complete such draws and to carry out the terms of this . resolution. Section 2. Affirmation. As amended by this amendatory resolution, Resolution No. R- 2010 -60 is hereby ratified, approved and confirmed. • • 1 Res No. R- 2011 -143 Amending R- 2010 -60 Kiwanis Park Projcct (1997 Bond Keybank Line Of Credit).Doc rev. Section 3. This resolution shall be in effect from and after its adoption in accordance with law. ADOPTED BY THE CITY COUNCIL this 6 day of September, 2011. CITY OF YAKIMA, WASHINGTON • • Micah Ca ey, Mayor P ' SEAL ATTEST: �1 0 111 0 _ . it r) Deborah ester, CMC, City Clerk • • • • • 2 Res No. R -2011 -143 Amending R- 2010 -60 Kiwanis Park Project (1997 Bond Keybank Line Of Credit).Doc rev. •