Explanation
BACKGROUND: The City owns or owned Franklin County Tax ID Parcel Nos. 010-054645 (the “NMDA Parcel”) and 010-307276 (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 2135-2023 also authorized the City to enter into the Cooperative Agreement dated August 29, 2023 with the Columbus-Franklin County Finance Authority to provide a portion of the financing for the Public Project (the “Public Improvements Grant”). Ordinance 3371-2023 authorized the first five million dollars of the Public Improvement Grant to the Columbus-Franklin County Finance Authority. This legislation will authorize the $13 million dollars of the Public Improvement Grant to the Columbus-Franklin County Finance Authority per the agreement. Additional legislation will be submitted to address the remaining balance of the Public Improvements Grant.
An amendment to the 2024 Capital Improvement Budget is necessary in order to amend and reduce the authority within the Streets and Highways GO Bond Fund (7704) in the amount up to $18 million and increase the authority within the Development Taxable Bonds Fund (7739) in the amount up to $18 million dollars. It is also 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 Bond fund. The funds will be reimbursed upon receipt of the bond proceeds.
Emergency Designation: An emergency exists as the payment per the agreement is due and is necessary for the improvement and expansion of the North Market per the signed agreement.
FISCAL IMPACT: Funding for this project will not be available to the Department of Development until the bonds are sold related to the 2024 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 amend the 2024 Capital Improvements Budget; 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 Bond 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 project pursuant to the Cooperative Agreement dated August 29, 2023; 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 now 32-story mixed use project adjacent to the NMDA Parcel on the former City owned the Franklin County Tax ID Parcel No. 010-307276 (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 to provide a portion of the financing for the Public Project (the “Public Improvements Grant”); and
WHEREAS, Ordinance 3371-2023 authorized the first five million dollars of the Public Improvement Grant to the Columbus-Franklin County Finance Authority; and
WHEREAS, this ordinance authorizes funding in the amount of $13,000,000.00 for the funding of the Public Improvements Grant pursuant to the Cooperative Agreement; and
WHEREAS, it is necessary to authorize an amendment to the 2024 Capital Improvements Budget for the purpose of providing sufficient spending authority for the funding of the Public Improvements Grant; 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 Bond fund and authorize the appropriation within the Development Taxable Bond Fund.
WHEREAS, it is necessary to authorize the expenditure within the Development Taxable Bond 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 project described in this ordinance (the "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, additional legislation will be submitted for the remaining balance of the Public Improvements Grant; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development in that it is immediately necessary to authorized the Director to submit the payment to the Columbus-Franklin County Finance Authority per the agreement dated August 29, 2023 because the payment is due; 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 2024 Capital Improvement Budget authorized by ordinance 1907-2024 be amended as follows:
Fund / Project / Project Name / Current / Change /C.I.B. as Amended
7704/P441768-100008/North Market Streetscape Ph 2 (Voted 2022 ITSA Supported)/$18,000,000/($18,000,000)/$0
7739/P441768-100009/North Market CFA Contribution (Councilmanic ITSA Supported)/$0/$18,000,000/$18,000,000
SECTION 2. 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, 2024, 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 Bond Fund, Fund No. 7739, in Object Class 06 Capital Outlay per the account codes in the attachment to this ordinance.
SECTION 3. 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 4. That pursuant to the Cooperative Agreement, 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 (North Market CFA Contribution), in Object Class 06 (Capital Outlay) per the account codes attached to this ordinance.
SECTION 5. That the Director of the Department of Development be and hereby is authorized to remit the initial funding of the Public Improvements Grant to the Columbus-Franklin County Finance Authority pursuant to the Cooperative Agreement. That the monies herein shall be paid upon order of the Director of the Department of Development, 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 6. 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 3.
SECTION 7. 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 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 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 Project will be made.
SECTION 8. 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 9. 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 10. That the City Auditor is authorized to establish proper project accounting numbers as appropriate.
SECTION 11. 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 12. 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.