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HomeMy WebLinkAboutRES-2006-007 Final Approval of terms & conditions for Meadowlands Building acquisition & financing~~~ -~c~ - a o 7 ~~ Resolution providing final approval of terms and conditions For Meadowlands Building acquisition and financing WHEREAS - Orange County has previously determined in principle to finance the acquisition of a building located at 510 Meadowlands Drive, Hillsborough, and associated real and personal property (collectively, the "Meadowlands Building"). The County's plan for the project includes owner financing for the acquisition. The County's Board of Commissioners has been provided a draft of the proposed contract for the acquisition (the "Sales Contract"), which provides (a) for a purchase price of $1,735,000, (b) for $50,000 of the purchase price to be paid in cash at closing, and (c) for the remaining amount to be financed by the sellers for 10 years at an annual interest rate of 5%. The Sales Contract includes as an exhibit the form of the Financing Agreement and Deed of Trust (the "Financing Agreement") that the parties will enter into to memorialize the financing transaction and to provide for a lien on the property to secure the County's obligations to the sellers. The proposed financing would therefore be secured by a lien on the Meadowlands Building (including the associated land and any related fixtures) and the County's promise to repay the financing, but there would be no recourse against the County or its property (other than the pledged property) if there were a default on the financing. The County's plan requires the approval of the North Carolina Local Government Commission (the "LGC"). Under LGC guidelines, this governing body must make certain findings of fact to support the County's application for the LGC's approval of the County's proposed financing arrangements for the project The County's undertaking of the financing was the subject of a public hearing held earlier today on January 24, 2006. NOW, THEREFORE, BE IT RESOLVED that the Board of Commissioners of Orange County, North Carolina, makes the following findings of fact: (a) The proposed project is necessary and appropriate for the County under all the circumstances. The County has long searched for a solution to its on-going need for bulky storage items and for records with long-term archival space. The Meadowlands Building will provide a solution to these problems, along with providing office space for several County departments with plentiful parking and room for expansion. (b) The proposed installment financing is preferable to a bond issue for the same purpose. The current owners of the Meadowlands Building desire to provide owner financing for the County's acquisition, and therefore an installment financing presents itself as the most appropriate financing vehicle. The County has long determined to combine voted and non- voted financings in its capital improvements program. (c) The estimated sums to fall due under the proposed financing contract are adequate and not excessive for the proposed purpose. Although the financing rate contemplated by the Contract may exceed financing rates otherwise available to the County, the advantageous purchase price offsets any detriment from the financing rate. In addition, the financing rate and owner financing are key business considerations for the seller in the negotiations for the County's acquisition of a most desirable building. (d) As confirmed to the Board at this meeting by the County's Finance Officer, (I) the County's debt management procedures and policies are sound and in compliance with law, and (ii) the County is not in default under any of its debt service obligations. (e) Although the County expects that there will be from time to time tax increases associated with the County's overall capital investment program, any tax increase attributable to the current proposed financing will be minimal and appropriate under all the circumstances (f) The County Attorney is of the opinion that the proposed project is authorized by law and is a purpose for which public funds of the County may be expended pursuant to the Constitution and laws of North Carolina BE IT FURTHER RESOLVED by the Board of Commissioners of Orange County, North Carolina, as follows: 1. Determination To Proceed with Financing -The County confirms its plans to undertake and finance the acquisition of the Meadowlands Building. The County will carry out the plan with owner financing, and generally as described in the draft Sales Contract. The Board approves the Sales Contract and the Financing Agreement in the forms provided, and the Sales Contract and the Financing Agreement in final form must be in substantially the forms presented. 2. Direction To Execute Documents -- The Board authorizes and directs the Board's Chair, the County Manager and the County Finance Officer to act on the County's behalf and to execute and deliver all appropriate documents (the "Documents") for the proposed financing, including the Sales Contract and the Financing Agreement in their final forms. The execution and delivery of any Document by an authorized officer will be conclusive evidence of his approval of the final form of such Document. The Documents in final form, however, must be consistent with the financing plan described in this resolution. 3. Authorization to Finance Officer To Complete Closing - The Board authorizes and directs the Finance Officer to hold executed copies of all financing documents authorized or permitted by this resolution in escrow on the County's behalf until the conditions for their delivery have been completed to such officer's satisfaction, and thereupon to release the executed copies of such documents for delivery to the appropriate persons or organizations. Without limiting the generality of the foregoing, the Board specifically authorizes the Finance Officer to approve changes to any Documents, agreements or certifications previously signed by County officers or employees, provided that such changes do not conflict with this resolution or substantially alter the intent from that expressed in the form originally signed. The Finance Officer's authorization of the release of any such document for delivery will constitute conclusive evidence of such officer's approval of any such changes. 4. Resolutions As To. Tax Matters -- The County will not take or omit to take any action the taking or omission of which will cause its obligations to pay principal and interest under the Sales Contract (the "Obligations") to be "arbitrage bonds," within the meaning of Section 148 of the "Code" (as defined below), or "private activity bonds" within the meaning of Code Section 141, or otherwise cause interest components of the installment payments to be includable in gross income for federal income tax purposes. Without limiting the generality. of the foregoing, the County will comply with any Code provision that may require the County at any time to pay to the United States any part of the earnings derived from the investment of the financing proceeds. In this resolution, "Code" means the United States Internal Revenue Code of 1986, as amended, and includes applicable Treasury regulations. 6. Miscellaneous Provisions -- All County officers and employees are authorized and directed to take all such further action as they may consider necessary or desirable in furtherance of the purposes of this resolution. All such prior actions of County officers and employees are ratified, approved and confirmed. Upon the absence, unavailability or refusal to act of the County Manager, the Board's Chair or the Finance Officer, any other of such officers may assume any responsibility or carry out any function assigned in this resolution. All other Board proceedings, or parts thereof, in conflict with this resolution are repealed, to the extent of the conflict. This resolution takes effect immediately. ~ * * ~ ~ ~ ~ I certify that the foregoing resolution was duly adopted at a meeting of the Board of Commissioners of Orange County, North Carolina, duly called and held on January 24, 2006, and that a quorum was present and acting throughout such meeting. Such resolution remains in full effect as of today. Dated this day of January, 2006. Donna S. Baker Clerk, Board of Commissioners Orange County, North Carolina BARRYJACOBS, CHA/R ORANGE COUNTY BOARDpOF COM iMISSIONERS STEPHEN H. HAUOO77S, V/CECHA/R PO.S~' OFFICE DOX ~ ~ 8 ! MOSES CAREY, JR VALER/E P. FOUSHEE 200 SOUTH CAMERON STREET AUCE M. CORDON HILLSBOROUGH, NORTH CAROLINA 27278 \°tt I, Donna S. Baker, County Clerk of Orange County, North Carolina, do hereby certify that the attached is a true and accurate copy of the draft Minutes of the January 24, 2006 Regular Meeting of the Orange County Board of Commissioners, where the Commissioners adopted unanimously the resolution entitled the ""Resolution Providing Final Approval of Terms and Conditions for Meadowlands Building Acquisition and Financing." This the 24th day of January 2006. Donna S. Baker, CMC Clerk to the Board iv°J~~e ~atr~~ ~~:~~ A by ' u4 ``+} h !! ~~~~" r, ((- !~•3 I ~~ j~ B~ WWW. CO.ORANGE. NC. US PROTECT/NG AND PRESERV/NG -PEOPLE, RESOURCES, QUAL/TY OF L/FE ORANGE COUNTY, NORTH CAROLINA -YOU COUNT./ (919) 242130 • FAX (919) 644-0246 BARRYJACOBS, CHA/R ORANGE COUNTY BOARD OF COMMISSIONERS STEPHEN H. HALK/OTIS, I~/CE-CHA/R MOSESCAREY, JR POST OFFICE BOX 8 '(8 '[ VALERIEP. FOUSHEE 200 SOUTH CAMERON STREET ALICE M. GORDON HILLSBOROUGH, NORTH CAROLINA 27278 ~~~~~ I, Donna S. Baker, County Clerk of the Orange County, North Carolina, do hereby certify that the attached is a true and correct copy of a resolution entitled "Resolution Providing Final Approval of Terms and Conditions for Meadowlands Building Acquisition and Financing," as approved unanimously by the Orange County Board of Commissioners at their regular meeting on January 24, 2006. This the 24th day of January 2006. Donna S. Baker ~~.~ County Clerk u~~;~~ ~r y~:. ~sto~ WWW. CO.ORANGE. NC. US PROTECT/NG AND PRESERV/NG -PEOPLE, RESOURCES, QUAL/TY OF L/FE ORANGE COUNTY, NORTH CAROL/NA -YOU COUNT./ (919) 24,5.2130 • FAX (919) 644-0246 DRAFT Minutes of January 24 2006 Orange County Board of Commissioners Meeting 8. Public Hearings a. Public Hearina On Financing the Acauisition of a Facility Located at 510 Meadowlands Dave. Hillsborough and Adoption of Relate Resolution The Board conducted a public hearing on matters related to financing the acquisition of a facility located at 510 Meadowlands Drive in Hillsborough, as approved by the Board of Commissioners on December 13, 2005 and considered adopting a resolution that authorizes the financing. Ken Chavious, Finance Director, said that the owner of this building has agreed to the County's purchase of the building at a sum of $1, 700, 000 and the County's purchase of non-inventory equipment and furnishings in the building for a sum of $35,000. All but $50,000 of the total $1, 735,000 will be owner financed for a period of 10-years at an interest rate of 5%. In addition, the Board of County Commissioners authorized the Finance Director to submit an application to the Local Government Commission (LGC) for approval for the financing. Ken Chavious said that a preliminary application requesting approval for this proposed financing has been forwarded to the LGC and prior to the LGC granting approval, the Board of County Commissioners is required to conduct a public hearing on matters related to the financing proposal. In addition to the public hearing, the Board is also required to adopt a resolution in support of the County's application. The resolution also grants the necessary approval of the transaction as well as authorizes County staff to finalize the financing. The resolution has been prepared by Bond Counsel in compliance with the requirements of the LGC. There was no public comment. A motion was made by Commissioner Halkiotis, seconded by Commissioner Carey to close the public hearing. VOTE: UNANIMOUS A motion was made by Commissioner Foushee, seconded by Commissioner Halkiotis to adopt the Resolution Providing Final Approval of Terms and Conditions for the Meadowlands Building Acquisition and Financing. VOTE: UNANIMOUS