Resolution 3766 - Authorizing Immanuel Lutheran Home Project and BondsRESOLUTION NO, 3766
A RESOLUTION
AUTHORfZTMC A PaOJECT UNDER TITLE 90, CHAPTER 5, PART 1,
nC);,TANA CODE
ANNOTATED, AND THE
SALE AND ISSUANQ OF VIRST MORTGAGE,
HO��STNG REVENUE
BONDS (I:�i:lANUEL
LUTHE Ai; HOME PROJECT), SERIES 193
;Oi•�L P„ LCT ,
AND AUTHORIZING
THE EXECUTION AND
DELIVERY OF THE BONDS S NECESSARY
t�Oc,D� t��ID
DOCUMENTS.
';E IT RESOLVED by the City
Nont�.na ( the City) follows:
Council, of t} e City '--of_`. Kalispell,
--
, as
--
Section 1. Authorization
and -Recitals.
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1.01. General Authority. The City is authorized by Title 90,
Chapter 5, Parr 1, Montana Code Annotated (the "Act") to issue revenue
bonds for the purpose of defraying the cost of acquiring or improving
projects consisting of real and personal properties suitable for use
in manufacturing, industrial -and commercial enterprises, including
multifamily housing facilities, and to loan the proceeds of such
bonds to others to pay such costs upon such terms and conditions as
the governing body of the City -shall deem advisable and as shall not
conflict with ,the provisions of the Act.
1.02. Pro used Project and Bonds. Representatives of Immanuel
.Lutheran Home (the Borrower) have proposed that the City, acting
under and pursuant to the Act, issue and sell its First Mortgage
Housing Revenue Bonds (Immanuel Lutheran Home), Series 1987, in an
aggregate principal amount of $6,545,000 (the "Bonds"), for the purpose
of defraying the costs of constructing and equipping a building and
related improvements (the "Project") suitable for and to be used as a
multifamily housing facility for the elderly. Pursuant to the proposal,
the proceeds of the Bonds will be loaned by the City to the Borrower,
and the Borrower will agree to apply the proceeds to the payment of
costs of the Project and to make payments sufficient to pay the
principal of, premium, if any, and interest on the Bonds when due.
The City will grant a security interest in certain revenues and
payments to be received by" one City under. T,- Loan Agreement (as
hereinafter defined) to a Trustee (as hereinafter defined) and the
Borrower will lie obligated to pay all costs of the Project in excess
of the Bond proceeds available therefor.
1.03. Public Hearing and Prior Approval. At a public- hearing,
duly noticed and held on August 3,y 1987, in accordance with Section
147(f) of the Internal Revenue Code of 1986, as amended (the. "Code")
on the proposed issuance of the Bonds, all parties who appeared at
the hearing were given an opportunity to express their views with
respect to the issuance of the Bonds. On August 19, 1987, this
Council gave preliminary approval to the Project and the issuance of
the Bonds.
1.04. Project Costs. The Borrower and the Purchaser have advised
this Counsel and this Counsel hereby finds that the estimated costs
of the Project at the present time are approximately as follows:
Construction and Equipment Costs
Costs of Issuance Financed out of
Bond Proceeds
Other Issuance and Organization Costs
Construction Period Interest
Working Capital Reserve
$6,662,680
130,900
289,350
637,445
5,423
Total
7,725,798
All costs of the Project in excess of the proce;=.ds of the Bonds
av2il able therefore are faquir£ to by 021 & b`J
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Q::tt`'-Ci, <?S of 0CtC:7C1 , 1987, p r c P c s e d to Df_ maCie L.lid enrcd
into bott,.Tocn. zho City z.nd First TrusC Company of 1"10ntL.nl as
trustee ( the "Trustee," ) ;
(b) An Indenture of Trust the "Indenture"), to be
dated as of October 1, 1987, proposed to be made and entered
into between the City and First Trust Company of Montana, as
trustee (the "Trustee");
(c) A Bond Purchase. Agreement the "Bond Purchase
Agreement"), to be dated October. 1987 proposed to be
made and entered into among Norwest Investment Services,
Inc. (the "Purchaser"), Norwest Bank Minneapolis, National
Association (the "Bank"), the City and the Borrower;
(d) A Mortgage, Security Agreement, Assignment of Rents
and Leases and Fixture Financing Statement (the Mortgage),
to be dated as of October 1, 1987, proposed to be made and
entered into between the Borrower and the Trustee;
(e) A Reimbursement Agreement (the "Reimbursement
Agreement" ) , to be dated as of October 1, 1987, proposed to
be made and entered into between the Borrower and the Bank;
(f) A Mortgage, Security Agreement, Assignment of Leases
and Rents and Fixture Financing Statement (the "Bank
Mortgage"), to be dated as of October. 1, 1987, proposed to
be made and entered into between the Borrower and the Bank;
and
(g) A Remarketing Agreement (the "Remarketing Agreement"),
to be dated October , 1987, proposed to be made and
entered into among the City, the Borrower, the Trustee and
the Purchaser.
(h) A Preliminary Official Statement dated October 6,
1987 (thy "Official Statement") containing certain information
regarding the City, the Borrower, the Project and the documents
set forth above, whereby the Purchaser will offer the Bonds
to investors.
Section 2. Findings.
It is hereby found, determined and declared that:
(a) the Project comprises real and personal properties
which shall be suitable for use in connection with a multifamily
housing facility as contemplated by the Act;
(b) in authorizing the Project the City's purpose is
and in its judgment the -effect thereof -w11l be to promote
the public welfare by encouraging the location of a multifamily
housing facility for the elderly in the City, thereby encour-
aging the development and use of the available resources of
the City, Flathead County, and the State; improving employment
opportunities of present and future residents of the City;
providing necessary housing facilities and stimulating renewal
and redevelopment of the area;
(c). the acquisition and construction of the Project,
the issuance and sale of the Bonds, the execution and delivery
of the Loan Agreement, the Indenture, the Remarketing Agreement
and the Bond Purchase Agreement and the performance of all
covenants and agreements of the City contained in the Loan
Agreement, the Indenture, the Remarketing Agreement and the
Bond Purchase Agreement and of all other acts and things
required under. the Constitution and laws of the State of
Montana to make the Loan Agreement, the Indenture., the Remar-
keting Agreement and the Bond Purchase Agreement and the
Bonds valid and binding obligations in accordance with their
terms, are authorized by the Act;
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(d) the issuance and sale of the Bonds, the acquisition
and construction of the Project and the financing of the
Project by the City for the benefit of the Borrower is in
the public interest of the City and its citizens;
(e.) it is desirable that the Borrower be authorized,
subject to the terms and conditions set forth in the Loan
Agreement, which terms and conditions the City determines to
be necessary, desirable and proper, to provide for the acqui-
sition, construction and equipping of the Project by such
means as shall be available to the Borrower and in the
manner determined by the Borrower, and with or without adver-
tisement for bids as required for the acquisition and
construction of municipal facilities;
(f) ---it is desirable that the Bonds be issued by the
City upon the terms set forth in the Indenture, under the
provisions -of which the City grants to the Trustee a security
interest in certain revenues and payments to be received by
the City under the Loan Agreement as security for the payment -
of the principal of, premium, if any, and interest on the
Bonds;
(g) - the loan repayments contained in the Loan Agreement
will produce income and revenue sufficient to provide for
prompt payment of principal of and interest on all Bonds
issued under the Indenture when due; and the Loan Agreement
also provides that the Borrower is required to pay all expenses
of the operation and maintenance of the Project, including,
but without limitation, adequate insurance thereon and
insurance against all liability for injury to persons or
property arising from the operation thereof, and all taxes
and special assessments levied upon or with respect to the
site of the Project and payable during the term of the Loan
Agreement;
(h) the execution and delivery of the Loan Agreement,
the Indenture, the Remarketing Agreement and the Bond Purchase
Agreement will not conflict with, or constitute on the part
of the City a breach of or a default under, any existing
agreement, indenture, mortgage, lease or other instrument to
which the City is subject or is a party or by which it is
bound; provided that this finding is made solely for the
purpose of estopping the City from denying the validity of
the Loan Agreement,. the Indenture or the Bond Purchase Agreement
by reason of the existence of any facts contrary to this
finding;
(i) no litigation is pending or, to the best knowledge
of the members of this Council, threatened against the City
questioning the organization or boundaries of the City or
the right of any officer of the City to hold his or her
office,'or in any manner questioning the right and power of
the City to execute and deliver the Bonds, or otherwise
questioning the validity of the Bonds or the execution,
delivery or validity of the Loan Agreement, the Indenture,
the Remarketing Agreement or the Bond Purchase Agreement, or
questioning the appropriation of revenues to payment of the
Bonds or the right of the City to loan the proceeds of the
Bonds to the Borrower;
(j) all acts and things required
under the Constitution
and the laws of the State of Montana to make the Loan
Agreement, the Indenture, the Remarketing Agreement and the
Bond Purchase Agreement the
valid and binding obligations of
the City in accordance with their terms will have been done
upon adoption of this Resolution and execution of the Loan
Agreement, the Indenture,
the Remarketing Agreement and the
Bond Purchase Agreement; provided that this finding is
made
solely for the purpose of estopp.ing the City from denying
the validity of the
Loan Agreement, the Indenture, the Remar-
keting Agreement and the Bond Purchase
Agreement by reason
of the existence of any facts contrary to this finding;
(k) under the provisions of the Act and as provided in
the Loan Agreement and Indenture and stated on the face of
the Bonds, the Bonds are limited obligations of the City
payable solely from loan repayments from the Borrower (except
to the extent payable from proceeds of the sale or condemnation
of the Project or insurance proceeds therefrom) and do not
constitute a pecuniary liability of the City or a charge
against its general credit or taxing powers; and
(1) the City is duly organized and existing under the
Constitution and laws of the State of Montana and is .authorized _
to issue the Bonds in accordance with the Act.
3. Authorization and Approval of the Project and Documents.
The City is hereby authorized to finance part or all of the costs
of the Project as presently estimated under Section 1.04, and to
pledge and assign the Loan Agreement and the loan repayments due
thereunder, all as provided in the Loan Agreement, the Indenture, the
Remarketing Agreement and the Bond Purchase Agreement. The forms of
the Loan Agreement, the Indenture, the Remarketing Agreement and the
Bond Purchase Agreement referred to in Section 1.05 are approved
subject to such modifications as are deemed appropriate and approved
by the City Attorney and the. Mayor, which approval shall be conclusively
evidenced by execution of the Loan Agreement, the Indenture, the
Remarketing Agreement, the Bond Purchase Agreement and the Bonds by
the Mayor and the City Clerk and where required, the City Treasurer.
The Mayor and City Clerk are directed to execute the Loan Agreement,
the Indenture, the Remarketing Agreement and the Bond Purchase Agreement.
The City authorizes the distribution of the Official Statement to
prospective purchasers of the Bonds with such variations, insertions
and additions as the Mayor or City Attorney may deem appropriate.
Copies of all of the documents shall be delivered, filed and recorded
as provided therein. The Mayor, the City Clerk and the City Treasurer
are also authorized and directed to execute such other instruments as
may be required to give effect to the transactions herein contemplated,
including the defeasance of City's First Mortgage Nursing Horne Revenue
Bonds (Immanuel Lutheran Home Project) Series 1976 and the transfer
and release of the City's interest in the Nursing Horne facility
funded by such bonds.
4. The Bonds; Terms, Sale and Execution. The City hereby authorizes
the issuance of the Bonds in an aggregate principal amount not to
exceed $6,545,000, in the form and upon the terms set forth in the
Indenture and this resolution. The Bonds shall bear interest at
rates agreed to by the Purchaser, the Borrower and the City, provided
that no such rate nor the net effective interest rate shall exceed
nine percent'per annum. The Mayor and the City Clerk are authorized
to approve the final principal amounts and interest rates. The Bonds
are hereby sold to the Purchaser at a price not less than 95% of the
principal amount hereof and upon the terms contained in the Bond
Purchase Agreement.
4.02. Execution. The Mayor, the City Clerk and, where required,
the City Treasurer are hereby authorized and directed to execute the
Bonds as prescribed herein and in the Indenture and to deliver them
to the Trustee, together with a certified copy of this resolution,
the other documents required in the Indenture, and such other certi-
ficates, documents and instruments as may be appropriate to effect
the transactions herein contemplated.
4.03. Modifications, Absence of Officers.- ---The approval hereby
given to the various documents re erred to above includes an approval
of such modifications thereto, deletions therefrom and additions thereto
as may be necessary and appropriate and approved by the City Attorney
and the Mayor prior to the execution of the documents. The execution
of any instrument by the appropriate officer or officers of the City
herein authorized shall be conclusive evidence of the approval of
such documents in accordance with the terms hereof. In the absence
or disability of the Mayor, any of the documents authorized by this
resolution to be executed may be executed by the acting Mayor, and in
the absence. or disability of the City Clerk by such officer of the
City who, in the opinion of the City Attorney, may execute such
documents.
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Section 5. Authentication of Proceedings.
The Mayor., City Clerk and other officers of the City are authorized
and directed to furnish to the Purchaser and bond counsel certified
copies of all `proceedings and records of the City relating to the
Bonds, and such other affidavits and certificates as may be required
to show' the facts relating to the legality and marketability of the
Bonds as such facts appear from the books and records in the officer's
custody and control or as otherwise known to them; and all such
certified copies, certificates and affidavits, including any heretofore
furnished, shall constitute representations of the City as to the
truth of all statements contained therein.
Section 6. Qualified Tax -Exempt_ Obligations.
The City hereby determines and declares that the City does not
reasonably anticipate to issue in calendar year 1987 tax-exempt obli-
gations in an aggregate principal amount greater than $10,000,000
(exclusive of Private Activity Bonds as defined in the Code). The
City hereby specifically designates the Bonds as "qualified tax-exempt
obligations" within the meaning of Section 265 of the Code, and
covenants that it will not in any event designate in calendar. year
1987 more than $10,000,000 of its obligations as such "qualified
tax-exempt obligations".
Section 7. Effective Date.
This Resolution shall be effective immediately upon its final
adoption.
PASSED BY THE CITY COUNCIL OF THE CITY OF KALISPELL AND APPROVED
BY THE MAYOR THIS 19th DAY OF OCTOBER, 1987.
h4q )K� ,
nd"! enned Jr., Mayor
ATTEST:
City erk-Treasurer
1, the undersigned, City Clerk of the City of Kalispell, certify that the
foregoing is a true copy of the Resolution pas3ed by the City Council of the
City of Kalispell., Montana at a regular oeeting held
City Clerk of the City of Kalispell