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HomeMy WebLinkAboutRes 2021-10-1003 Multifamily Revenue Bonds or Notes with Respect to Palladium East Foster CrossingANNA PUBLIC FACILTY CORPORATION Resolution No. 401 to ` 1005 A RESOLUTION DECLARING THE INTENT TO ISSUE MULTIFAMILY MORTGAGE REVENUE BONDS OR NOTES WITH RESPECT TO PALLADIUM EAST FOSTER CROSSING MULTIFAMILY RENTAL DEVELOPMENT IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $33,000,000, AUTHORIZING THE FILING OF AN APPLICATION FOR ALLOCATION OF PRIVATE ACTIVITY BONDS WITH THE TEXAS BOND REVIEW BOARD; AND AUTHORIZING OTHER ACTION RELATED THERETO WHEREAS, effective September 17, 2021, the Anna Public Facility Corporation, a nonprofit corporation (the "Corporation or Issuer") has been duly created and organized pursuant to and in accordance with the provisions of the Public Facility Corporation Act, Chapter 303, Texas Local Government Code, as amended, (the "Act"); and WHEREAS, the Act authorizes the Corporation to issue revenue bonds for the purpose of assisting the City of Anna, Texas (the "City") in financing, refinancing, owning or providing public facilities, as determined by the Board of Directors of the Corporation; and WHEREAS, Sections 103 and 142(a)(7) of the Internal Revenue Code of 1986, as amended (the "Code"), provide that the interest on fully registered obligations issued by or on behalf of a state or a political subdivision thereof substantially all of the proceeds of which are to be used to provide qualified residential rental projects shall be excludable from gross income for federal income tax purposes if the requirements of Section 142(d) and other applicable sections of the Code are satisfied; and WHEREAS, it is currently requested that the Corporation issue its tax-exempt revenue bonds for the purpose of providing financing for a multifamily housing residential rental development (the "Project") to be located within the City at the address set forth in Exhibit "A" attached hereto, and to be owned by Palladium East Foster Crossing, Ltd., a Texas limited partnership or a related person within the meaning of the Code (herein called the "Owner"); and WHEREAS, the Corporation has been informed that the Owner has made not more than 60 days prior to the date hereof, payments with respect to the acquisition, construction, reconstruction or rehabilitation of the Project and expects to make additional payments in the future and the Corporation desires to reimburse such payments and other costs associated with the Project from the proceeds of tax-exempt obligations to be issued by the Corporation subsequent to the date hereof (the "Bonds"); and WHEREAS, the Corporation desires to reimburse the Owner for some or all of the costs associated with the Project listed in Exhibit "A" attached hereto, but solely from and to the extent, if any, of the proceeds of the Bonds; and WHEREAS, the Corporation reasonably expects, based on information and representations of the Owner, to incur debt in the form of tax-exempt obligations for purposes of paying the costs of the Project described in Exhibit "A" attached hereto; and WHEREAS, in connection with the proposed issuance %J the Bonds, the Corporation, as issuer of the Bonds, is required to submit an Application for Allocation of Private Activity Bonds the "Application") with the Texas Bond Review Board (the "Bond Review Board") with respect to the Bonds to qualify for the Bond Review Board's Allocation Program in connection with the Bond Review Board's authority to administer the allocation of the authority of the State to issue private activity bonds; and WHEREAS, the Board of Directors has determined to declare its intent to issue its multifamily revenue bonds for the purpose of providing funds to the Owner to finance the Project on the terms and conditions hereinafter set forth; NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE ANNA PUBLIC FACILITY CORPORATION THAT: Section 1. The Corporation reasonably expects to reimburse the Owner for all or a portion of the costs ("Costs of the Project") that have been or will be paid subsequent to the date that is 60 days prior to the date hereof in connection with the acquisition, construction, reconstruction or rehabilitation of the property comprising the Project listed on Exhibit "A" attached hereto from the proceeds of the Bonds in an amount which is reasonably estimated to be sufficient: (a) to fund a loan to provide financing for the acquisition, construction, equipping and furnishing of the Project, including reimbursing the Owner for all costs that have been or will be paid subsequent to the date that is 60 days prior to the date hereof in connection with the acquisition, construction, reconstruction or rehabilitation of the Project; (b) to fund certain reserves for the benefit of the holders of the Bonds, if required; and (c) to pay certain costs incurred in connection with the issuance of the Bonds. Section 2. Based on representations of the Owner, the Corporation reasonably expects that the maximum principal amount of tax-exempt obligations issued to reimburse the Owner for the costs set forth in Exhibit "A" attached hereto will not exceed $33,000,000, Section 3. The obligation of the Corporation to issue the Bonds on atax-exempt basis is specifically subject to the ability of the Corporation to issue such Bonds in compliance with the "Volume Cap" provisions of Section 146 of the Code, Chapter 1372, Texas Government Code, as amended, and the rules of the Bond Review Board promulgated pursuant thereto, and to any rules, regulations or conditions of the Corporation relating to the issuance of the Bonds. Section 4. The Project will be in furtherance of the public purposes of the Corporation set forth in the Act, and the Owner has provided or will provide, or cause to be provided, at its expense, the necessary interim financing to expedite the commencement of the acquisition, construction, reconstruction or rehabilitation of the Project. On or prior to the issuance of the Bonds, the Owner will enter into a purchase, lease or loan agreement on an installment payment basis with the Corporation under which the Corporation will make a loan to the Owner for the purpose of reimbursing the Owner for the Costs of the Project and the Owner will make installment payments sufficient to pay the principal of and any premium and interest on the Bonds. The Bonds shall never constitute an indebtedness or pledge of the faith and credit of the State, of the City or of any other political corporation, subdivision or agency of the State within the meaning of any State constitutional or statutory provision, and the Bonds shall never be paid in whole or in part out of any funds raised or to be raised by taxation or any other funds of the City, and shall be limited obligations of the Corporation payable solely from the revenues received by the Corporation from or in connection with its loan to provide financing for the Project and from such other amounts as may be obtained through the exercise of the remedies provided in the financing documents upon the occurrence of an event of default. Section 5. The Costs of the Project may include any cost of acquiring, constructing, reconstructing, rehabilitating, improving and expanding the Project. Without limiting the generality of the foregoing, the Costs of the Project shall specifically include the cost of the acquisition of all land, rights -of -way, property rights, easements and interests, financing charges, inventory, raw materials and other supplies, interest prior to and during construction and for one year after completion of construction whether or not capitalized, necessary reserve funds, the cost of estimates and of engineering and legal services, plans, specifications, surveys, estimates of cost and of revenue, other expenses necessary or incident to determining the feasibility and practicability of acquiring, constructing, reconstructing, rehabilitating, improving and expanding the Project, administrative expenses and such other expenses as may be necessary or incident to the acquisition, construction, reconstruction, rehabilitation, improvement and expansion of the Project, the placing of the Project in operation and that satisfy the Act and the Code. The Owner, as a condition to issuance of the Bonds, shall (i) be responsible for and pay any Costs of the Project incurred by it prior to issuance of the Bonds and will pay all Costs of the Project which are not or cannot be paid or reimbursed from the proceeds of the Bonds and (ii) at all times, indemnify and hold harmless the Corporation, its Board of Directors, the City, and its City Council, and all City employees, consultants, and representatives against all losses, costs, damages, expenses and liabilities of whatsoever nature (including but not limited to attorneys' fees and related expenses, litigation and court costs, amounts paid in settlement and amounts paid to discharge judgments) directly or indirectly resulting from, arising out of or related to the issuance, offering, sale or delivery of the Bonds, or the design, construction, installation, operation, use, occupancy, maintenance or ownership of the Project. Section 6. Neither the Owner nor any other party is entitled to rely on this Resolution as a commitment to loan funds, and the Corporation reserves the right not to issue the Bonds either with or without cause and with or without notice, and in such event the Corporation shall not be subject to any liability or damages of any nature. No person, entity, or association shall have any claim against the Corporation whatsoever as a result of any decision by the Corporation not to issue the Bonds. Section 7. The Corporation acknowledges that financing of all or any part of the Project may be undertaken by the Owner or any company or partnership that is a "related person" to the Owner within the meaning of the Code and the Treasury Regulations thereunder, including any entity controlled by or affiliated with the Owner. Section 8. This Resolution constitutes the Corporation's official intent for expenditures on Costs of the Project which will be reimbursed out of the issuance of the Bonds within the meaning of Sections 1.103.8(a)(5)(i) and (ii) and 1.150-2, Title 26, Code of Federal Regulations, as amended, and applicable rulings of the Internal Revenue Service thereunder, to the end that the Bonds issued to reimburse Costs of the Project may qualify for the exemption provisions of Section 144 of the Code, and that the interest on the Bonds will therefore be excludable from the gross incomes of the owners thereof under the provisions of Section 103(a)(1) of the Code. Section 9. The Corporation hereby authorizes the ng and any resubmission of an Application with the Bond Review Board and any application for carryforward, that McCall, Parkhurst & Horton be designated as an authorized representative of the Corporation for purposes of an Application and that any officer of the Corporation is hereby authorized and directed to execute an Application on behalf of the Corporation and to take any and all other actions related to such Application or necessary or desirable to carry out the provisions of this Resolution. Section 10. The officers, employees and agents of the Corporation shall be, and each is, expressly authorized, empowered and directed from time to time and at any time to do and perform all acts and things necessary and desirable to carry out and effectuate the purposes of this Resolution. Section 11. The Board of Directors of the Corporation hereby finds, determines and declares that written notice of the date, hour, place and subject of the meeting at which this Resolution was adopted was posted and that such meeting was open to the public as required by law at all times during which this Resolution and the subject matter hereof were discussed, considered and formally acted upon, all as required by the Texas Open Meetings Act, Chapter 551, Texas Government Code. PASSED AND APPROVED this the 12th day of October 2021. APPROVE Nate Pike, President ATTEST: Kevin Toten, Secretary EXHIBIT "A" Description of the Project Costs of the Project to be financed by tax-exempt bonds in an amount not to exceed $33,000,000 include the acquisition, construction, equipping, reconstruction or rehabilitation of a multifamily residential housing project proposed to be located at the northeast corner of East Foster Crossing and Vail Lane in the City of Anna, Texas 75409,