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HomeMy WebLinkAboutAUTHORIZING RESOLUTION PROVIDING FOR APPROVAL OF AN INTERGOVERNMENTAL REDEVELOPMENT CONTRACT BETWEEN AUGUSTA, GA AND THE URBAN REDEVELOPMENT AGENCY OF AUGUSTA IN SUPPORT OF THE FOUNDRY PROJECT AUTHORIZING RESOLUTION WHEREAS, the Augusta-Richmond County Commission (the "Commission"), which is the governing body of Augusta, Georgia (the "Consolidated Government"), in order to exercise the powers conferred upon the Consolidated Government by Chapter 61 of Title 36 of the Official Code of Georgia Annotated, entitled the "Urban Redevelopment Law," as amended (the "Urban Redevelopment Law"), adopted a resolution on March 16, 2010, finding that one or more slum areas exist in Augusta, Georgia and that the rehabilitation, conservation, or redevelopment, or a combination thereof, of such area or areas is necessary in the interest of the public health, safety,morals, or welfare of the residents of Augusta, Georgia; and WHEREAS, the Commission, by resolution adopted on March 16, 2010, designated the area covered by the hereinafter described urban redevelopment plan as a "slum area" that the Commission designated as appropriate for urban redevelopment projects; and WHEREAS, the Commission held public hearings on March 22, 2010 and April 1, 2010, on a proposed urban redevelopment plan entitled "Laney-Walker and Bethlehem Urban Redevelopment Plan" (the "Urban Redevelopment Plan"), a copy of which is on file with the Consolidated Government; and WHEREAS, public notice of such public hearings was published in The Augusta Chronicle, a newspaper having a general circulation in the area of operation of the Consolidated Government, and proof of such publication is on file with the Consolidated Government; and WHEREAS, the Commission, by resolution adopted on April 1, 2010, approved the Urban Redevelopment Plan and the urban redevelopment projects set forth therein; and WHEREAS, the Urban Redevelopment Agency of Augusta (the "Issuer") is a public body corporate and politic duly created and validly existing under and pursuant to the Urban Redevelopment Law; and WHEREAS, the Consolidated Government, by resolution adopted on April 1, 2010, activated the Issuer and elected to have the Issuer exercise the Consolidated Government's "urban redevelopment project powers" under the Urban Redevelopment Law, and the Issuer's commissioners have been appointed as provided in the Urban Redevelopment Law and are currently acting in that capacity; and WHEREAS, an Act of the General Assembly of the State of Georgia, which became effective on July 1, 2015, amended the Urban Redevelopment Law to substitute the terms "pocket of blight" and "pocket of blight clearance and redevelopment," for the terms"slum area" and"slum clearance and redevelopment,"although the meanings assigned to such terms were not amended; and WHEREAS, the Urban Redevelopment Law authorizes the Consolidated Government to appropriate such funds and make such expenditures as may be necessary to carry out the purposes of the Urban Redevelopment Law and to levy taxes and assessments for such purposes; and 35485061.v2 WHEREAS, Article IX, Section III, Paragraph I of the Constitution of the State of Georgia of 1983 authorizes the Consolidated Government to contract for any period not exceeding fifty years with any public corporation or public authority for joint services, for the provision of services, or for the joint or separate use of facilities or equipment, if such contract deals with activities, services, or facilities that the contracting parties are authorized by law to undertake or provide; and WHEREAS, in furtherance of the purposes for which it was created, the Issuer proposes to issue not to exceed $28,000,000 in original aggregate principal amount of its Urban Redevelopment Agency of Augusta Revenue Bonds (CV Foundry Apartments, LLC Project), Federally Taxable Series 2017 (the "Bonds"), in order to finance the costs of acquiring, constructing, and installing an urban redevelopment project consisting of land, buildings, improvements, machinery, fixtures, furnishings, equipment, and other real and personal property located within the territorial limits of Augusta, Georgia, constituting an approximately 221-unit apartment community to be located on an approximately 7.6-acre site at the intersection of Railroad Avenue and Wrightsboro Road (the "Project"), which site is in the area covered by the Urban Redevelopment Plan, and to finance related costs; and WHEREAS, the Issuer expects to lease the Project to CV Foundry Apartments, LLC, a Georgia limited liability company (the"Lessee"), pursuant to a Lease Agreement, to be dated the date of its execution and delivery (the "Lease Agreement"), under the terms of which the Issuer will acquire, construct, and install the Project and the Lessee will lease the Project from the Issuer and will pay to the Issuer such rentals at such times and in such amounts as will be required to enable the Issuer to pay the principal of, premium, if any, and interest on the Bonds, as and when the same become due; and WHEREAS, to secure the Lessee's obligations under the Lease Agreement, the Issuer proposes to require the Lessee to cause Columbia Ventures, LLC ("Columbia"), a Georgia limited liability company, and Noel Khalil, Jim Grauley, Dillon Baynes, and Jakob von Trapp, each individuals (collectively the "Guarantors"), to execute and deliver a Limited Guaranty Agreement (the "Limited Guaranty"), to be dated as of the first day of the month of its execution and delivery,between the Guarantors and the Issuer,under the terms of which the Guarantors will agree to absolutely and unconditionally, jointly and severally guarantee the obligations of the Lessee under the Lease Agreement; provided, the Limited Guaranty will expire when the Project achieves Project Stabilization(as defined in the Lease Agreement); and WHEREAS, to secure its obligation to pay principal of, premium, if any, and interest on the Bonds, the Issuer proposes to assign and pledge to U.S. Bank National Association (the "Trustee"), as trustee, and proposes to grant a first priority security interest in, all of its right, title, and interest in the Lease Agreement (except for the Unassigned Rights, as defined in the Lease Agreement), the Limited Guaranty, the hereinafter described Security Deed, and the hereinafter described Assignment of Contract Documents and in certain funds established and held thereunder, pursuant to a Trust Indenture and Security Agreement (the "Indenture"), to be dated as of the first day of the month of its execution and delivery, between the Issuer and the Trustee; and -2- 35485061.v2 WHEREAS, to further secure the obligations of the Issuer under the revenue bonds to be issued, the Issuer proposes to cause the Lessee to execute and deliver in favor of the Trustee a Bond Guaranty Agreement (the "Bond Guaranty"), dated as of even date herewith, between the Lessee and the Trustee, pursuant to which the Lessee will absolutely and unconditionally guarantee the obligations of the Issuer under the Bonds; and WHEREAS, to further secure the Lessee's obligations under the Lease Agreement and the Bond Guaranty, the Issuer proposes to require the Lessee to (1) grant to the Issuer a first lien on and first security title to certain real property constituting the Project, will assign and pledge to the Issuer the Lessee's interest in certain rents and leases derived from the Project, and will grant to the Issuer a first priority security interest in certain personal property constituting the Project, in certain revenues derived from the Project, and in certain contracts to which the Lessee is a party, pursuant to a Leasehold Deed to Secure Debt and Assignment of Rents and Leases (the "Security Deed"), to be dated the date of its execution and delivery, from the Lessee to the Issuer, and(2) collaterally assign and grant to the Issuer a first priority security interest in certain contracts relating to the Project, pursuant to an Assignment of Contract Documents (the "Assignment of Contract Documents"), dated the date hereof, by the Lessee in favor of the Issuer; and WHEREAS, in consideration of the issuance of the Bonds by the Issuer to finance the costs of acquiring, constructing, and installing the Project in furtherance of the Urban Redevelopment Plan, the Consolidated Government proposes to enter into an Intergovernmental Redevelopment Contract, to be dated as of the first day of the month of its execution and delivery (the "Contract"), with the Issuer, the form of which Contract has been filed with the Consolidated Government and submitted to the Commission, under the terms of which Contract the Consolidated Government(1)will agree to make payments to the Issuer in amounts sufficient to enable the Issuer to pay the principal of, premium, if any, and interest on the Bonds when due, to the extent the rental payments made by the Lessee pursuant to the Lease Agreement are insufficient for such purposes, and (2) will agree to levy an annual ad valorem tax on all taxable property located within the territorial limits of the Consolidated Government, at such rate or rates, within the mill limit prescribed by an amendment to Article VII, Section I, Paragraph II of the Constitution of the State of Georgia of 1945 (1980 Ga. Laws 2177 to 2180, inclusive), now specifically continued as a part of the Constitution of the State of Georgia of 1983 pursuant to an Act of the General Assembly of the State of Georgia (1983 Ga. Laws 3870 to 3872, inclusive), or within such greater millage as may hereafter be prescribed by applicable law, as may be necessary to produce in each year revenues that are sufficient to fulfill the Consolidated Government's obligations under the Contract; and WHEREAS, pursuant to the terms of the Indenture, the Issuer will also pledge the amounts received from the Consolidated Government under the Contract as security for payment of the Bonds; and WHEREAS, the Issuer proposes to authorize the marketing of the Bonds by means of a Preliminary Official Statement (the "Preliminary Official Statement") and an Official Statement, to be dated the date of its execution and delivery (the "Official Statement"), both of which will contain information about the Issuer, the Lessee, the Consolidated Government, and the Project; and -3- 35485061.v2 WHEREAS, the Issuer adopted a Bond Resolution (the "Bond Resolution") on June 21, 2017 pursuant to which the Issuer (1) authorized the issuance of the Bonds, (2) authorized the execution, delivery, and performance by the Issuer of the Lease Agreement, the Limited Guaranty, the Indenture, the Security Deed, the Assignment of Contract Documents, and the Contract (collectively the "Issuer Documents"), and (3),approved the form and substance of the Bond Guaranty; and WHEREAS, pursuant to that certain Memorandum, dated October 2, 2017 (the "Memorandum"), from Jakob von Trapp, Partner, Columbia Ventures, LLC, to Hawthorne Welcher, Director, Augusta Department of Housing and Development, Columbia has proposed certain modification terms in response to concerns raised by the Commission, and the Issuer proposes to adopt a Supplemental Bond Resolution providing for such modification terms to be incorporated into the Issuer Documents; and WHEREAS, the Bond Resolution, with the forms of the Issuer Documents and the Bond Guaranty attached as exhibits thereto, the Preliminary Official Statement, and the Memorandum have been filed with the Commission; and WHEREAS, after careful study and investigation, the Consolidated Government desires to enter into the Contract; NOW, THEREFORE, BE IT RESOLVED by the Augusta-Richmond County Commission as follows: 1. The form, terms, and conditions and the execution, delivery, and performance of the Contract, which has been filed with the Consolidated Government, are hereby approved and authorized. The Contract shall be in substantially the form submitted to the Commission with such changes, corrections, deletions, insertions, variations, additions, or omissions as may be approved as to form by the General Counsel of the Consolidated Government, and the execution of the Contract by the Mayor of the Consolidated Government whose signature shall be initialed by the General Counsel of the Consolidated Government, shall be conclusive evidence of the approval thereof. 2. The Mayor of the Consolidated Government is hereby authorized and directed to execute on behalf of the Consolidated Government the Contract, and the Clerk of Commission of the Consolidated Government is hereby authorized and directed to affix thereto and attest the seal of the Consolidated Government, upon proper execution and delivery of the other parties thereto, provided, that in no event shall any such attestation or affixation of the seal of the Consolidated Government be required as a prerequisite to the effectiveness thereof, and the Mayor and Clerk of Commission of the Consolidated Government are authorized and directed to deliver the Contract on behalf of the Consolidated Government to the other parties thereto, and to execute and deliver all such other contracts, instruments, documents, affidavits, or certificates (including, without limitation, a Rule 15c2-12 Certificate and a Continuing Disclosure Certificate) and to do and perform all such things and acts as each shall deem necessary or appropriate in furtherance of the issuance of the Bonds and the carrying out of the transactions authorized by this Resolution or contemplated by the instruments and documents referred to in this Resolution. -4- 35485061.v2 3. The use and distribution of the Preliminary Official Statement and the Official Statement with respect to the Bonds shall be and is hereby authorized, ratified, confirmed, and approved, and execution and delivery of the Official Statement in final form shall be and is hereby authorized, ratified, confirmed, and approved. The Mayor is hereby authorized and directed to ratify, confirm, approve, execute, and deliver the Official Statement on behalf of the Consolidated Government, and the execution of an Official Statement by the Mayor shall constitute conclusive evidence of the Mayor's ratification, confirmation, approval, and delivery thereof on behalf of the Consolidated Government. 4. This Resolution and the Contract, as approved by this Resolution, which is hereby incorporated in this Resolution by this reference thereto, shall be placed on file at the office of the Consolidated Government and made available for public inspection by any interested party immediately following the passage and approval of this Resolution. PASSED,ADOPTED, SIGNED,APPROVED,AND EFFECTIVE this I44/day of November 2017. AUGUSTA, GEORGIA (SEAL) By: oe Mayor Attest: gActi mat`kik12720// a , ID +496 Iftt,6 604.94,04001e. -5- 35485061.v2 CLERK OF COMMISSION'S CERTIFICATE I, LENA J. BONNER, the duly appointed, qualified, and acting Clerk of Commission of Augusta, Georgia (the "Consolidated Government"), DO HEREBY CERTIFY that the foregoing pages of typewritten matter constitute a true and correct copy of a resolution adopted on November 7, 2017,by the Augusta-Richmond County Commission (the "Commission") in a meeting duly called and assembled in accordance with applicable laws and with the procedures of the Consolidated Government, by a vote of Yea and Nay, which meeting was open to the public and at which a quorum was present and acting throughout, and that the original of the foregoing resolution appears of public record in the Minute Book of the Commission,which is in my custody and control. GIVEN under my hand and the seal of the Consolidated Government, this day of November 2017. (SEAL) Clerk of Commission 35485061.v2