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HomeMy WebLinkAboutResolutions 2011-038 N.C.S. 03/07/2011Resolution No. 2011 -038 N.C.S. of the City of Petaluma, California A JOINT RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PETALUMA AND THE PETALUMA COMMUNITY DEVELOPMENT COMMISSION AUTHORIZING AND APPROVING THE FIRST AMENDMENT TO 1988 PASS THROUGH AGREEMENT BY AND AMONG THE CITY OF PETALUMA, THE PETALUMA COMMUNITY DEVELOPMENT COMMISSION, THE SONOMA COUNTY LIBRARY AND THE COUNTY OF SONOMA AND AUTHORIZING THE CITY MANAGER/COMMMISSION EXECUTIVE DIRECTOR TO EXECUTE SUCH AMENDMENT ON BEHALF OF THE CITY AND THE COMMISSION WHEREAS, the City of Petaluma ( "City ") is a California municipal corporation and charter city; and, WHEREAS, the Petaluma Community Development Commission ( "PCDC ") is a redevelopment agency formed, existing and exercising its powers pursuant to California Community Redevelopment Law, Health and Safety Code Section 33000 et seq. ( " Law "); and, WHEREAS, the City, the PCDC, the Sonoma County Library ( "Library ") and the County of Sonoma ( "County ") made and entered into as of the 26` day of September, 1988 (the "1988 Agreement ") for the purpose of addressing allocation of tax increment affecting the parties; and, WHEREAS, Section 3.3 of the 1988 Agreement ( "Section 3.3 ") provides for payment to the Library and the County of certain property tax revenues ( "Tax Increment Revenues ") which would otherwise be allocated and paid to the PCDC pursuant to the and the provisions of a redevelopment plan or plans (the "Redevelopment Plans ") which have been adopted by the City in accordance with the Law; and, WHEREAS, as authorized by the Law and the Redevelopment Plans, the PCDC proposes to enter into a loan agreement with an appropriate lender (the "2011 Loan ") to provide for the financing of transportation improvements in accordance with the Redevelopment Plans, and the PCDC has been advised that, in order to provide for the consummation of the 2011 Loan under current market conditions, the PCDC needs to obtain written consent from the County to the subordination of its entitlement to receive its prescribed portion of the annual Tax Increment Revenues pursuant to Section 3.3 to the payment of the principal of and the interest on the payment obligations of the PCDC which are secured by and are payable from Tax Increment Revenues, including both previously- established payment obligations and the proposed 2011 Loan (the "PCDC's Tax Increment Debt Service "); and WHEREAS, the sole purpose of the proposed first amendment to the 1988 Agreement ( "First Amendment ") is to amend Section 3.3 to provide that, upon the written request of the PCDC, either the Library or the County or both may be authorized by their respective legislative bodies to consent in writing to the subordination of their respective entitlements to receive Tax Increment Revenues in accordance with Section 3.3 to the payment of the PCDC's Tax Increment Debt Service, subject to the provisions of the First Amendment respecting reimbursement with interest of the amount or amounts so subordinated in the event that Tax Resolution No. 2011 -038 N.C.S. Page 1 Increment Revenues are insufficient in any given Tax Year to pay both the PCDC's Tax Increment Debt Service and the entitlements of the consenting party to receive its prescribed portion of the Tax Increment Revenues for that Tax Year. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma and the Board of the Petaluma Community Development Commission as follows: 1. The First Amendment to Agreement by and among the City of Petaluma, the Petaluma Community Development Commission, the Sonoma County Library and the County of Sonoma, which is attached to and made a part of this resolution as Exhibit A is approved on behalf of the City of Petaluma and the Petaluma Community Development Commission. 2. The City Manager /Petaluma Community Development Commission Executive Director is hereby authorized and directed on behalf of the City and the Community Development Commission to execute an agreement substantially in accordance with Exhibit A and as approved by the City Attorney /Commission Counsel and to undertake such actions and to execute such additional instruments as may be necessary or desirable in order to carry out the intent of this Resolution. 3. Declares that if any provision, sentence, clause, section or part of this resolution is found to be unconstitutional, illegal or invalid, such finding shall affect only such provision, sentence, clause, section or part, and shall not affect or impair any of the remaining parts. Under the power and authority conferred upon this Council by the Charter of said City REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the LpVpre a s to Council of the City of Petaluma at a Regular meeting on the 7` day of March, 201 1, by the following vote: t io Attorney AYES: Albertson, Barrett, Mayor Glass, Harris, Vice Mayor Healy, Kearney, Renee NOES: None ABSENT: None ABSTAIN: None ATTEST: OjDjAs-e� OA76�� City Clerk IQ Mayor Resolution No. 2011 -038 N.C.S. Page 2 EXHIBIT A TO RESOLUTION FIRST AMENDMENT TO AGREEMENT BY AND AMONG THE CITY OF PETALUMA, THE PETALUMA COMMUNITY DEVELOPMENT COMMISSION, THE SONOMA COUNTY LIBRARY AND THE COUNTY OF SONOMA Recitals A. This First Amendment to Agreement by and Among the City of Petaluma, the Petaluma Community Development Commission, the Sonoma County Library and the County of Sonoma (this "First Amendment "), is dated March 7, 2011, and represents an amendment of an agreement entitled, "Agreement by and Among the City of Petaluma, California, the Petaluma Community Development Commission, the Sonoma County Library and the County of Sonoma," made and entered into as of the 26 day of September, 1988 (the "1988 Agreement "). Collectively, the City of Petaluma (the "City "), the Petaluma Community Development Commission (the "PCDC "), the Sonoma County Library (the "Library ") and the County of Sonoma (the "County ") are referred to herein as the. "Parties." B. Section 3.3 of the 1988 Agreement ( "Section 3.3 ") provides for payment to the Library and the County of certain property tax revenues ( "Tax Increment Revenues ") which would otherwise be allocated and paid to the PCDC pursuant to the Community Redevelopment Law (the "Law ") and the provisions of a redevelopment plan (the "Redevelopment Plan") which has been adopted by the City in accordance with the Law. C. As authorized by the Law and the Redevelopment Plan, the PCDC proposes to enter into a loan agreement with an appropriate lender (the "2011 Loan") to provide for the financing of transportation improvements in accordance with the Redevelopment Plan, and the PCDC has been advised that, in order to provide for the consumation of the 2011 Loan under current market conditions, the PCDC needs to obtain written consent from the County to the subordination of its entitlement to receive its prescribed portion of the annual Tax Increment Revenues pursuant to Section 3.3 to the payment of the principal of and the interest on the payment obligations of the PCDC which are secured by and are payable from Tax Increment Revenues, including both previously - established payment obligations and the proposed 2011 Loan (the "PCDC's Tax Increment Debt Service "). D. The sole purpose of this First Amendment is to amend Section 3.3 to provide that, upon the written request of the PCDC, either the Library or the County or both may be authorized by their respective legislative bodies to consent in writing to the subordination of their respective entitlements to receive Tax Increment Revenues in accordance with Section 3.3 to the payment of the PCDC's Tax Increment Debt Service, subject to the provisions of this First Amendment respecting reimbursement with interest of the amount or amounts so subordinated in the event that Tax Increment Revenues are insufficient in any given Tax Year to pay both the PCDC's Tax Increment Debt Service and the entitlements of the consenting party to receive its prescribed portion of the Tax Increment Revenues for that Tax Year. Resolution No. 2011 -038 N.C.S. Page 3 E. In consideration of the mutual undertakings prescribed herein, the Parties agree as follows: Agreement 1. Section 3.3 of the 1988 Agreement is hereby amended to add the following language at the end of the current language of Section 3.3: "Notwithstanding the foregoing provisions of this Section 3.3, upon receipt of the written request of the PCDC, either the Library or the County, or both, may but shall not be required to be authorized by their respective legislative bodies, in the exercise of their absolute discretion, to consent in writing to the subordination of their respective entitlements to receive Tax Increment Revenues in accordance with this Section 3.3 to the payment of the PCDC's Tax Increment Debt Service; provided that, in the event that Tax Increment Revenues are insufficient in any given Tax Year to pay both the PCDC's Tax Increment Debt Service and the entitlements of the consenting party to receive its prescribed portion of the Tax Increment Revenues for that Tax Year, resulting in receipt by the Library or the County or both, as the case may be, of an amount which is less than the entitlement established by this Section 3.3, then the Library or the County or both, as the case may be, shall be reimbursed the amount of the shortfall, together with interest thereon at the interest rate applicable to the 2011 Loan, out of the first funds received by the PCDC and legally available for such reimbursement. As used in the foregoing paragraph of this Section 3.3, the term "2011 Loan" shall include any refunding bonds issued or other obligations established after closing on the 2011 Loan to refund the remaining obligations under the 2011 Loan, provided that the aggregate payment obligations on any such refunding obligations does not exceed the remaining payment obligations on the 2011 Loan and that the last principal payment date of any such refunding obligations is no later than the last payment date on the 2011 Loan." 2. In all other respects, except as provided by the amendment set forth in the foregoing paragraph 1 of this First Amendment, the 1988 Agreement shall remain in full force and effect. Resolution No. 2011 -038 N.C.S. Page 4 3. By the execution hereof, the Parties to this First Amendment hereby acknowledge that this First Amendment has been duly approved by their respective governing bodies and that execution by the respective officers or representatives of the Parties who have executed it on behalf of each such Party has been authorized. COUNTY OF SONOMA CITY OF PETALUMA By: Title: SONOMA COUNTY LIBRARY By: Title: Attest: Sonoma County Clerk Approved as to form: Kathy Laroque Deputy County Counsel County of Sonoma Approved as to form: By: Title: Sonoma County Library 1596598.1 By: Title: PETALUMA COMMUNITY DEVELOPMENT COMMISSION By: Title: Attest: Petaluma City Clerk Approved as to form: Eric Danly City Attorney, General Counsel City of Petaluma and Petaluma Community Development Commission Resolution No. 2011 -038 N.C.S. Page 5