ACTION REQUESTED:
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Communication from the City Manager and Finance Director/Comptroller with a Request to ADOPT an ORDINANCE Providing for the ISSUANCE of TAXABLE GENERAL OBLIGATION BONDS, SERIES 2015C, in an Aggregate Amount Not to Exceed $7,600,000, and TAXABLE GENERAL OBLIGATION BONDS, SERIES 2015D, in an Aggregate Amount Not to Exceed $2,000,000, of the City of Peoria, Peoria County, Illinois to Provide for Certain Improvements within said City, and Providing for the Levy of a Direct Annual Tax Sufficient to Pay the Principal of and Interest on Each of Said Series of Bonds, and Authorizing the Sale of Said Bonds to the Purchasers Thereof.
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BACKGROUND: On February 11, 2014 the City Council approved the First Amendment to Annexation Agreement with James S. Chambers, Thomas J. Chambers, and Terry L. Chambers, owners and Twenty Four Corp, LLC, Petersen Companies, LLC, and Petersen Hospitality, LLC to allow for the development of a sports complex and athletic facility. As part of the annexation agreement the City agreed to issue bonds in the amount of $7,600,000 for the Peoria Sports Center SSA and $2,000,000 for the Holiday Inn SSA with repayment being assured as general obligation bonds.
On November 25, 2014 the City Council approved an Early Work Loan Agreement in an amount not to exceed $3,000,000 with Twenty Four Corporation LLC (TFC). As part of the Early Work Agreement the City staff negotiated several other conditions that clarified and defined the City’s obligations under the First Amendment to the Annexation Agreement. Specifically, the parties acknowledged and confirmed that the City shall have no further obligation to create any Special Service Areas (SSA), levy or collect SSA taxes, provide the SSA funding, or incur the Debt Obligations described in the First Amendment until:
• TFC has provided to the City a commitment for debt financing, from a reputable financial institution or other reasonably accepted lender, and/or cash equity for the Louisville Slugger Project and the Holiday Inn (assuming the City contribution of $9.6 million);
The City has received confirmation that TFC has deposited $10 million in an escrow account at Chicago Title relating to the Louisville Slugger Complex project and a commitment letter from Morton Community Bank for the Holiday Inn project has been received, as well as, the a sources and uses statement.
As a result, the attached ordinance provides for the issuance of $7,600,000 of Taxable General Obligation Bonds 2015C and the issuance of $2,000,000 of Taxable General Obligation Bonds 2015D.
Upon receipt of the bond proceeds pursuant to the Early Work Agreement and the First Amendment, the City and TFC agree that the proceeds of the bonds shall first go to repay the outstanding balance, if any, on the Early Work Loan. After application of the bond proceeds to the payment of the Early Work loan, disbursements from the bond proceeds shall be on a dollar for dollar basis with the private funds.
FINANCIAL IMPACT: The City will issue bonds in the amount of $7,600,000 for the Louisville Slugger Sports Complex SSA and $2,000,000 for the Holiday Inn SSA with repayment being assured as a general obligation.
NEIGHBORHOOD CONCERNS: None regarding the issuance of the bonds.
IMPACT IF APPROVED: The City will sell bonds in accordance with the First Amendment to Annexation Agreement and the Early Work Loan Agreement.
IMPACT IF DENIED: The City would be in violation of the First Amendment to the Annexation Agreement and the Early Work Loan Agreement previously approved by Council.
ALTERNATIVES: N/A
EEO CERTIFICATION NUMBER: N/A
WHICH OF THE GOALS IDENTIFIED IN THE COUNCIL’S 2014 - 2029 STRATEGIC PLAN DOES THIS RECOMMENDATION ADVANCE?
1. Grow Peoria: Businesses, Jobs, and Population
WHICH CRITICAL SUCCESS FACTOR(S) FROM THE COMPREHENSIVE PLAN DOES THIS RECOMMENDATION IMPLEMENT?
1. Grow employers and jobs.
DEPARTMENT: Finance