Explanation
Background: The RiverSouth Authority issued bonds in 2004 and 2005 to purchase and rehabilitate the former downtown Lazarus Department Store. The City entered into a Master Lease Agreement and a First Supplemental Lease Agreement with The RiverSouth Authority on June 21, 2004 (Ordinance No. 1009-2004). The City entered into a Second Supplemental Lease Agreement with RiverSouth on July 25, 2005 (Ordinance No. 1312-2005). These agreements call for the City to make lease payments to The RiverSouth Authority in annual amounts equal to the bond service charges.
Fiscal Impact: The 2008 Capital Improvement Budget is hereby amended to allow for this expenditure.
Title
To authorize the appropriation of $5,154,976.26 from the Special Income Tax Fund to the City Auditor; to authorize the City Auditor to transfer said funds from the Special Income Tax Fund to the Northland and Other Acquisitions Fund; to authorize the appropriation of said funds in the Northland and Other Acquisitions Fund; to authorize the Director of the Department of Development to expend up to $5,154,976.26 from the Northland and Other Acquisitions Fund for 2009 lease rental payments to The RiverSouth Authority; and to amend the 2008 Capital Improvement Budget. ($5,154,976.26) Section 55(B) of the City charter.
Body
WHEREAS, pursuant to Ordinance No. 1009-2004 adopted by City Council on June 21, 2004 the City entered into a Master Lease Agreement and a First Supplemental Lease Agreement with The RiverSouth Authority (RiverSouth); and
WHEREAS, pursuant to Ordinance No. 1312-2005 adopted by this Council on July 25, 2005 the City entered into a Second Supplemental Lease Agreement with The RiverSouth Authority; and
WHEREAS, these Lease Agreements call for the lease rental payments from the City to RiverSouth equal to the bond service charges on the following bonds issued by RiverSouth:
· RiverSouth Areas Redevelopment 2004 Bonds Series A
· RiverSouth Areas Redevelopment 2005 Bonds Series A; and
WHEREAS, these lease rental payments are due to The RiverSouth Authority starting on May 22, 2009 for the June 1, 2009 payment date and again on November 21, 2009 for the December 1, 2009 payment date; and
WHEREAS, the City will sell notes or bonds to fund this project and will reimburse the Special Income Tax Fund, and this transfer should be considered as a temporary funding method; and
WHEREAS, the aggregate principal amount of obligations which the City will issue to finance this project is presently expected not to exceed $5,154,976.26; and
WHEREAS, the City anticipates incurring certain Original Expenditures (as defined in Section 1.150-2(c) of the Treasury Regulations (the "Treasury Regulations") promulaged pursuant to the Internal Revenue code of 1986, as amended) with respect to the project described in this ordinance (the "Project").
WHEREAS, the 2008 Capital Improvement Budget (Ordinance 0690-2008) is hereby amended to allow for this expenditure; and NOW THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. That from the unappropriated balance of the Special Income Tax Fund, Fund No. 430, and from all monies estimated to come into said fund from any and all sources and unappropriated for any other purchase during the fiscal year ending December 31, 2009, sum of $5,154,976.26 or so much thereof as may be necessary is hereby appropriated to the Department of the City Auditor, Div. No. 22-01, Object Level One 10, Object Level Three 5502 OCA 902023 for the purpose stated in Section 4.
Section 2. That the City Auditor is hereby authorized to transfer said funds to Fund 735 Northland and Other Acquisitions, Dept-Div 44-01, Project 441748 Downtown Revitalization, OCA 735748, Object Level Three 0886 at such time as is deemed necessary by the City Auditor.
Section 3. That the amount of $5,154,976.26 or so much thereof as may be necessary is hereby appropriated within Fund 735 Northland and Other Acquisitions, Dept/Div 44-01, Project 441748, OCA 735748, Object Level Three 6621.
Section 4. That the Director of Development is hereby authorized to expend $5,154,976.26 or so much thereof as may be necessary from Fund 735 Northland and Other Acquisitions, Dept/Div 44-01, Project 441748, OCA 735748, Object Level Three 6621 for the purpose of making lease rental payments to The River South Authority.
Section 5. That upon obtaining other funds for this project, the City Auditor is hereby authorized to repay the Special Income Tax Fund the amount transferred under Section 2 above, and said funds are hereby deemed appropriated for such purpose.
Section 6. That the City Auditor is authorized to make any accounting changes to revise the funding source for any contract or contract modification associated with the expenditure of the funds transferred in Section 2 above.
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 $5,154,976.26 (the "Obligations").
The City intends to make a reimbursement allocation on its books for the Original Expenditues 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 Expendiutes 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 2008 Capital Improvements Budget (Ordinance 0690-2008) is hereby amended as follows:
Project Current Budget Budget as Amended
Columbus Downtown
Development Corp. $2,890,000 $7,908,890
Section 9. That for the reasons stated in the preamble hereto, which is hereby made a part herof, and in accordance with Section 55(b) of the Charter of the City of Columbus, this ordinance shall take effect and be in force from and immediately after passage and approval by the mayor or ten days after passage if the Mayor neither approves or vetoes the same.