Explanation
BACKGROUND: The City owns Franklin County Tax ID Parcel Nos. 010-054645 (the “NMDA Parcel”) and formerly owned 010-307276 as has been split and re-platted from time to time (the “Project Site”). North Market Development Authority, Inc. (“NMDA”) leases and operates a public market in a former warehouse (the “North Market”) on the NMDA Parcel. The City selected NM Developer LLC (the “Developer”) from a request for proposals to redevelop the Project Site with a 32-story mixed-use project. Pursuant to Ordinance No. 2135-2023 passed by City Council on July 24, 2023, the City entered into the First Amended and Restated Economic Development Agreement dated August 29, 2023 (the “Restated EDA”) with the NMDA and the Developer. Pursuant to the Restated EDA, the new development on the Project Site will include public parking spaces, an expansion of the North Market, a public atrium, patio, and plaza in support of the North Market, and other public improvements and site work described in the Restated EDA (collectively, the “Public Project”). Ordinance No. 2135-2023 also authorized the City to enter into the Cooperative Agreement dated August 29, 2023 (the “Cooperative Agreement”) with the Columbus-Franklin County Finance Authority to provide a portion of the financing for the Public Project (the “Public Improvements Grant”). Ordinance No. 3371-2023 authorized the first five million dollars of the Public Improvement Grant to the Columbus-Franklin County Finance Authority, and Ordinance No. 3371-2024 authorized the next thirteen million dollars of said grant. This legislation will authorize amendments to the Restated EDA and the Cooperative Agreement to allow a more timely payment by the Columbus-Franklin County Finance Authority of a portion of the final $13 million dollars of the Public Improvement Grant to be remitted from the City to the Columbus-Franklin County Finance Authority. It is necessary to certify the required funds, in the amount up to $13 million dollars against the General Fund 1000, Income Tax Set Aside Subfund 100099 and authorize the appropriation and transfer of the funds from the Income Tax Set Aside Subfund to the Development Taxable Bonds Fund. The funds will be reimbursed upon receipt of the bond proceeds.
EMERGENCY DESIGNATION: An emergency exists in the usual daily operation of the Department of Development in order to allow for the immediate payment to be made prior to the contractual deadlines per the agreements and amendments and such expedited payment is necessary for the Public Project to be completed on time prior to the deadline in the agreements.
FISCAL IMPACT: Funding for this project will not be available to the Department of Development until the bonds are sold related to the 2025 Capital Improvement Budget and are available at a future date, therefore it is necessary to certify the required funds, in the amount up to $13,000,000.00, against the General Fund 1000, Income Tax Set Aside Subfund 100099. The fund will be reimbursed upon receipt of the bonds. There is sufficient budgetary authority for this project.
Title
To authorize an amendment to the First Amended and Restated Economic Development Agreement dated August 29, 2023 with North Market Development Authority, Inc. and NM Developer LLC; to authorize an amendment to the Cooperative Agreement dated August 29, 2023 with the Columbus-Franklin County Finance Authority; to authorize the appropriation of funds within the Income Set Aside Subfund and the Development Taxable Bonds Fund; to authorize the transfer of cash between the Income Tax Set Aside Subfund and the Development Taxable Bonds Fund; to authorize the expenditure within the Development Taxable Bonds Fund in an amount up to $13,000,000.00 for the public improvements for the North Market project; to authorize the Director of the Department of Development to remit a portion of the Public Improvements Grant to the Columbus-Franklin County Finance Authority for the North Market public project pursuant to the Cooperative Agreement; and to declare an emergency. ($13,000,000.00)
Body
WHEREAS, the City owns Franklin County Tax ID Parcel No. 010-054645 (the “NMDA Parcel”), which it leases to the North Market Development Authority, Inc. (“NMDA”) to operate a public market in a former warehouse on the NMDA Parcel (the “North Market”); and
WHEREAS, the City selected NM Developer LLC (the “Developer”) from a request for proposals to develop a 32-story mixed use project adjacent to the NMDA Parcel on the former City owned Franklin County Tax ID Parcel No. 010-307276 as has been split and re-platted from time to time (the “Project Site”); and
WHEREAS, pursuant to Ordinance No. 2135-2023 passed by City Council on July 24, 2023, the Director of the Department of Development (the “Director”) entered into the First Amended and Restated Economic Development Agreement dated August 29, 2023 (the “Restated EDA”) with NMDA and the Developer; and
WHEREAS, pursuant to the Restated EDA, the development on the Project Site will include certain public areas including 280 market and public parking spaces, collectively an approximately 19,000 square-foot expansion of the existing North Market including a public atrium, patio, and plaza, and other public improvements and site work described in the Restated EDA (collectively, the “Public Project”); and
WHEREAS, in order to effectuate certain provisions contained in the Restated EDA, Ordinance No. 2135-2023 also authorized the City to enter into the Cooperative Agreement dated August 29, 2023 (the “Cooperative Agreement”) with the Columbus-Franklin County Finance Authority (“CFCFA”) to provide a portion of the financing for the Public Project (the “Public Improvements Grant”); and
WHEREAS, Ordinance No. 3371-2023 authorized the first five million dollars of the Public Improvement Grant to the CFCFA; and
WHEREAS, Ordinance No. 3371-2024 authorized the next thirteen million dollars of the Public Improvement Grant to the CFCFA; and
WHEREAS, this ordinance authorizes funding in the amount of $13,000,000.00 for the final funding of the Public Improvements Grant; and
WHEREAS, it is necessary to authorize amendments to the Restated EDA and Cooperative Agreement to allow a more timely payment by the CFCFA of the final $13 million portion of the Public Improvement Grant to be remitted from the City to CFCFA; and
WHEREAS, it is necessary to certify the required funds, in the amount up to $13,000,000.00 dollars against the General Fund 1000, Income Tax Set Aside Subfund 100099 and authorize the appropriation and transfer of the funds in the amount up to $13,000,000.00 from the Income Tax Set Aside Subfund to the Development Taxable Bonds fund and authorize the appropriation within the Development Taxable Bonds Fund; and
WHEREAS, it is necessary to authorize the expenditure within the Development Taxable Bonds Fund in an amount up to $13,000.000.00; and
WHEREAS, the City anticipates incurring certain Original Expenditures (as defined in Section 1.150-2(c) of the Treasury Regulations (the "Treasury Regulations") promulgated pursuant to the Internal Revenue Code of 1986, as amended) with respect to the construction of the Public Project; and
WHEREAS, the City will reimburse the General Fund 1000, Income Tax Set Aside Subfund 100099; and
WHEREAS, this transfer should be considered as a temporary funding method; and
WHEREAS, the aggregated principal amount of obligations, which the City will issue to finance this project, is presently expected not to exceed $13,000,000.00; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development in order to allow for the immediate payment to be made prior to the contractual deadlines per the agreements and amendments and such expedited payment is necessary for the Public Project to be completed on time prior to the deadline in the agreements, all for the immediate preservation of the public health, peace, property, safety and welfare; and NOW, THEREFORE,
BE IT ORDAINED by the Council of the City of Columbus:
SECTION 1. That the Director, or his or her authorized designee, on behalf of the City, is authorized to enter into an amendment to the Restated EDA presently on file with the Department of Development, along with any changes or amendments thereto not inconsistent with this Ordinance and not substantially adverse to the City and which shall be approved by the Director and the City Attorney, provided that the approval of such changes and amendments thereto, and the character of those changes and amendments not being substantially adverse to the City, shall be evidenced conclusively by the execution and delivery thereof, that such changes are not inconsistent or adverse to the City.
SECTION 2. That the Director, or his or her authorized designee, on behalf of the City, is authorized to enter into an amendment to the Cooperative Agreement (the “Cooperative First Amendment”) presently on file with the Department of Development, along with any changes or amendments thereto not inconsistent with this Ordinance and not substantially adverse to the City and which shall be approved by the Director and the City Attorney, provided that the approval of such changes and amendments thereto, and the character of those changes and amendments not being substantially adverse to the City, shall be evidenced conclusively by the execution and delivery thereof, that such changes are not inconsistent or adverse to the City.
SECTION 3. That from the unappropriated monies and from all monies estimated to come into said funds from any and all sources and unappropriated for any other purpose during the fiscal year ending December 31, 2025, the sum of $13,000,000.00 is appropriated within General Fund 1000, Income Tax Set Aside Subfund 100099, in Object Class 10 Transfer Out Operating, and into the Development Taxable Bonds Fund, Fund No. 7739, in Object Class 06 Capital Outlay per the account codes in the attachment to this ordinance.
SECTION 4. That the transfer of $13,000,000.00, or so much thereof as may be needed, is hereby authorized between the General Fund 1000, Income Tax Set Aside Subfund 100099, and the Development Taxable Bonds Fund, Fund No. 7739, per the account codes in the attachment to this ordinance.
SECTION 5. That pursuant to the Cooperative Agreement and Cooperative First Amendment, the expenditure of $13,000,000.00, or so much thereof as may be needed, is hereby authorized in Fund 7739 (Development Taxable Bonds Fund), in Dept-Div 4402 (Economic Development), Project P441768-100009 (Councilmanic ITSA Supported), in Object Class 06 (Capital Outlay) per the account codes attached to this ordinance.
SECTION 6. That the Director , or his or her designee, be and hereby is authorized to remit the final funding of the Public Improvements Grant to the CFCFA pursuant to the Cooperative Agreement and Cooperative First Amendment; that the monies herein shall be paid upon order of the Director, or his or her designee, and that no order shall be drawn or money paid except by voucher, the form of which shall be approved by the City Auditor.
SECTION 7. That upon obtaining other funds, the City Auditor is hereby authorized and directed to repay the General Fund 1000, Income Tax Set Aside Subfund 100099 the amount transferred under Section 4.
SECTION 8. That the City intends that this ordinance constitute an "official intent" for purposes of Section 1.150 2(e) of the Treasury Regulations, and that the City reasonably expects to reimburse itself for certain Original Expenditures incurred with respect to the Public Project from the proceeds of obligations to be issued by the City in a principal amount currently estimated to be $13,000,000.00 (the "Obligations").
The City intends to make a reimbursement allocation on its books for the Original Expenditures not later than eighteen months following the later to occur of the date of the Original Expenditure to be reimbursed or the date the Public Project for which such Original Expenditures were made is "placed in service" within the meaning of Treasury Regulations Section 1.150 2(c). Upon the issuance of the Obligations, the proceeds of such Obligations shall be used to reimburse the fund from which the advance for costs of the Public Project will be made.
SECTION 9. That the funds necessary to carry out the purpose of this Ordinance are hereby deemed appropriated, and the City Auditor shall establish such accounting codes as necessary.
SECTION 10. That the City Auditor is hereby authorized and directed to transfer any unencumbered balance in the project account to the unallocated balance within the same fund upon receipt of certification by the Director of the Department administering said project that the project has been completed and the monies no longer required for said project; except that no transfer shall be made from a project account by monies from more than one source.
SECTION 11. That the City Auditor is authorized to establish proper project accounting numbers as appropriate.
SECTION 12. That the City Auditor is authorized to make any accounting changes to revise the funding source for all contracts or contract modifications associated with this Ordinance.
SECTION 13. That for reasons stated in the preamble hereto, which is hereby made a part hereof, this Ordinance is declared to be an emergency measure and shall take effect and be in force from and after its passage and approval by the Mayor, or ten days after passage if the Mayor neither approves nor vetoes the same.