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Resolution authorizing the borrowing of up to $150,000; providing for the issuance and sale of a Taxable General Obligation Promissory Note therefore; and levying a tax in connection therewith (Wisconsin Department of Natural Resources Ready for Reuse Brownfields Cleanup Loan Program)
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WHEREAS, the Common Council hereby finds and determines that it is necessary, desirable and in the best interest of the City of West Allis, Milwaukee County, Wisconsin (the "City") to raise funds for the purpose of paying the cost of making payments to assist in the removal or containment of, or the restoration of soil affected by, environmental pollution to eliminate blight (the "Project") on the site located at 9508-10 West Greenfield Avenue, West Allis, Wisconsin, and there are insufficient funds on hand to pay said costs; and,
WHEREAS, the State of Wisconsin Department of Natural Resources (the "State") is authorized to make loans for projects such as the Project for cleanup of a brownfield site under its Ready for Reuse Brownfields Cleanup Loan Program authorized by Section 292.72 of the Wisconsin Statutes (the "DNR Loan"); and,
WHEREAS, the City has or intends to enter into a Recapture Agreement and an Assignment Agreement (collectively, the "Agreements") with Dorothy G., a Wisconsin corporation (the "Developer") under which the City will loan the proceeds of the DNR Loan to the Developer to undertake the Project; will require the Developer to pay the City amounts it receives pursuant to a grant the Developer expects to receive from the Dry Cleaner Environmental Remediation Fund ("DERF") in connection with the Project; and will further require the Developer comply with the covenants and agreements the City will make pursuant to the agreement the City will enter into with the State (the "Loan Agreement"); and,
WHEREAS, the DERF amounts are not currently available; and,
WHEREAS, the Common Council hereby finds and determines that it is necessary, desirable and in the best interest of the City to enter into the Loan Agreement and to obtain a DNR Loan for the Project in anticipation of receiving amounts from the Developer pursuant to the Agreements; and,
WHEREAS, pursuant to the Loan Agreement, the State requires that a DNR Loan be evidenced by a general obligation security such as a general obligation promissory note; and,
WHEREAS, the Common Council hereby finds and determines that the Project is within the City's power to undertake and serves a "public purpose" as that term is defined in Section 67.04(1)(b) of the Wisconsin Statutes; and,
WHEREAS, cities are authorized by the provisions of Section 67.12(12) of the Wisconsin Statutes to borrow money and to issue a general obligation promissory note for such public purposes; and,
WHEREAS, due to certain provisions contained in the Internal Revenue Code of 1986, as amended, it is necessary to issue such general obligation promissory note on a taxable rather than tax-exempt basis; and,
WHEREAS, the Common Council now deems it to be necessary, desirable and in the best interest of the City to authorize the Loan Agreement and the issuance of its taxable general obligation promissory note to the State to obtain a DNR Loan.
NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of West Allis that:
Section 1. Authorization of the Note and the Loan Agreement. For the purpose of paying the cost of the Project, there shall be borrowed pursuant to Section 67.12(12) of the Wisconsin Statutes, the principal sum of up to ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000); and a fully registered general obligation promissory note of the City is authorized to be issued and evidenced thereof and sold to the State of Wisconsin Department of Natural Resources Ready for Reuse Brownfields Cleanup Loan Program in accordance with the terms and conditions of the Loan Agreement, in substantially the form attached as Exhibit A and incorporated herein by this reference. The Loan Agreement is hereby approved with such changes as the City Attorney approves, and the Mayor and City Clerk of the City are hereby authorized, by and on behalf of the City, to execute the Loan Agreement from the State in accordance with the terms and conditions of the Loan Agreement.
Section 2. Terms of the Notes. The Note shall be designated "Taxable General Obligation Promissory Note (DNR Ready for Reuse Brownfields Cleanup Loan)"; shall be dated as of the date of its issuance but no sooner than July 25, 2007; shall be in the denomination of $0.01 or any multiple thereof; shall be numbered 1 and upward; shall bear interest at the rate of 0% per annum and shall mature on July 25, 2017.
Section 3. Optional and Mandatory Redemption Provisions. The Note shall be subject to redemption prior to maturity at the option of the City, on any date as a whole or in part, at the principal amount thereof.
Further, the Note shall be subject to mandatory redemption prior to maturity, as a whole or in part, within 30 days after any date amounts are received by or on behalf of the City pursuant to the Agreements with respect to the Project.
Section 4. Form of the Note. The Note shall be issued in registered form and shall be executed and delivered in substantially the form attached hereto as Exhibit B and incorporated herein by this reference.
Section 5. Direct Annual Irrepealable Tax Levy. For the purpose of paying the principal of the Notes as the same becomes due, the full faith, credit and resources of the City are hereby irrevocably pledged, and there is hereby levied upon all of the taxable property of the City a direct annual irrepealable tax in the year 2016 for the payment due in the year 2017 in the amount sufficient to repay the outstanding balance of the Note.
The direct annual irrepealable tax hereby levied shall be carried onto the tax roll and collected in addition to all other taxes and in the same manner and at the same time as other taxes of the City for said year is collected. So long as any part of the principal of the Note remains unpaid, the tax hereinabove levied shall be and continues irrepealable except that the amount of tax carried onto the tax roll may be reduced in any year by the amount of any surplus in the Debt Service Fund Account created below.
Section 6. Segregated Debt Service Fund Account. There is hereby established in the City treasury a fund account separate and distinct from all other funds or accounts of the City designated "Debt Service Fund Account for $150,000 City of West Allis Taxable General Obligation Promissory Note (DNR Ready for Reuse Brownfields Cleanup Loan)", which fund account shall be used solely for the purpose of paying the principal of the Note. Said fund account shall be maintained for such purpose until such indebtedness is fully paid or otherwise extinguished.
Section 7. Borrowed Money Fund. The proceeds of the Note (the "Note Proceeds") shall be deposited into an account separate and distinct from all other funds and disbursed solely for the purposes for which borrowed or for the payment of the principal of the Note.
Section 8. Execution of the Note. The Note shall be issued in typewritten or printed form, executed on behalf of the City by the manual or facsimile signatures of the Mayor and City Clerk, authenticated, if required, by its fiscal agent, if any, sealed with its official or corporate seal, if any, or a facsimile thereof, and delivered to the State upon payment to the City of the purchase price thereof. In the event that either of the officers whose signatures appear on the Note shall cease to be such officers before the delivery of the Note, such signatures shall, nevertheless, be valid and sufficient for all purposes to the same extent as if they had remained in office until such delivery. The aforesaid officers are hereby authorized to do all acts and execute and deliver all documents as may be necessary and convenient to effectuate the Closing.
Section 9. Payment of the Note. The principal of the Note shall be paid in lawful money of the United States of America by the City Clerk/Treasurer.
Section 9A. Persons Treated as Owners; Transfer of Note. The City shall keep books for the registration and for the transfer of the Note. The person in whose name any Note shall be registered shall be deemed and regarded as the absolute owner thereof for all purposes and payment of principal on any Note shall be made only to the registered owner thereof. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Note to the extent of the sum or sums so paid.
The Note may be transferred by the registered owner thereof by surrender of the Note at the office of the City Clerk, duly endorsed for the transfer or accompanied by an assignment duly executed by the registered owner or his attorney duly authorized in writing. Upon such transfer, the Mayor and City Clerk shall execute and deliver in the name of the transferee or transferees a new Note or Notes of a like aggregate principal amount, series and maturity and the City Clerk shall record the name of each transferee in the registration book. No registration shall be made to bearer. The City Clerk shall cancel any Note surrendered for transfer.
The City shall cooperate in any such transfer, and the Mayor and City Clerk are authorized to execute any new Note or Notes necessary to effect any such transfer.
Section 10. Continuing Disclosure. The continuing disclosure requirements of SEC Rule 15c2-12, as amended, are not applicable to the Notes because the Notes are a primary offering of less than $1,000,000.
Section 11. Conflicting Resolutions; Severability; Effective Date. All prior resolutions, rules or other actions of the Common Council or any parts thereof in conflict with the provisions hereof shall be, and the same are, hereby rescinded insofar as the same may so conflict. In the event that any one or more provisions hereof shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provisions hereof. The foregoing shall take effect immediately upon adoption and approval in the manner provided by law.
cc: Department of Development
Chris Phinney, Grants Accounting Specialist
DEV-R-476-7-3-07\q&b