ORDINANCE 2018-41 AN ORDINANCE OF THE COUNCIL OF THE CITY OF HAZLETON, LUZERNE COUNTY, PENNSYLVANIA, AUTHORIZING THE LEASE OF CERTAIN REAL PROPERTY TO THE REDEVELOPMENT AUTHORITY OF THE CITY OF HAZLETON

ORDINANCE 2018-41

AN ORDINANCE OF THE COUNCIL OF THE CITY OF HAZLETON, LUZERNE COUNTY, PENNSYLVANIA, AUTHORIZING THE LEASE OF CERTAIN REAL PROPERTY TO THE REDEVELOPMENT AUTHORITY OF THE CITY OF HAZLETON PURSUANT TO A LEASE AGREEMENT; DECLARING THE GUARANTY OF SAID AUTHORITY’S GUARANTEED LEASE REVENUE NOTE FOR THE BENEFIT OF THE CITY OF HAZLETON TO BE A PROJECT OF THE CITY FOR WHICH LEASE RENTAL DEBT IS TO BE INCURRED; DETERMINING TO INCUR LEASE RENTAL DEBT IN A PRINCIPAL AMOUNT NOT TO EXCEED ONE MILLION EIGHTY-FIVE THOUSAND DOLLARS ($1,085,000) IN RESPECT OF SAID PROJECT, SUCH DEBT TO BE EVIDENCED BY THE CITY’S SUBLEASE AND GUARANTY AGREEMENT WITH RESPECT TO SAID NOTE; AUTHORIZING CERTAIN CITY OFFICERS TO PREPARE, CERTIFY AND FILE WITH THE DEPARTMENT OF COMMUNITY AND ECONOMIC DEVELOPMENT THE DEBT STATEMENT REQUIRED BY SECTION 8110 OF THE LOCAL GOVERNMENT UNIT DEBT ACT AND AUTHORIZING THE PREPARATION OF A BORROWING BASE CERTIFICATE; APPROVING THE FORM OF, AND AUTHORIZING, SUBJECT TO CERTAIN CONDITIONS, EXECUTION AND DELIVERY OF THE AFORESAID LEASE AGREEMENT AND SUBLEASE AND GUARANTY AGREEMENT; REPEALING INCONSISTENT PRIOR ORDINANCES; SETTING FORTH CERTAIN CONDITIONS TO THE EXECUTION AND DELIVERY OF THE AFORESAID LEASE AGREEMENT AND SUBLEASE AND GUARANTY AGREEMENT; AND AUTHORIZING THE PROPER OFFICERS OF THE CITY TO TAKE ALL REQUIRED, NECESSARY OR DESIRABLE RELATED ACTION IN CONNECTION WITH SUCH PROJECT AND THE EXECUTION AND DELIVERY OF THE LEASE AGREEMENT AND THE SUBLEASE AND GUARANTY AGREEMENT.

WHEREAS, the Redevelopment Authority of the City of Hazleton (the “Authority”) is a body corporate and politic organized under the provisions of the Urban Redevelopment Law, Act of May 24, 1945, P.L. 991, as amended and supplemented (the “Act”); and

WHEREAS, the City of Hazleton, Pennsylvania (the “City”) has determined to undertake a project (the “Project”) involving the City leasing to the Authority, pursuant to the provisions of a lease agreement between the City and the Authority (the “Lease Agreement”), all of the City’s right, title and interest in certain real property as more specifically identified in the Lease Agreement; and

WHEREAS, the Authority intends to finance the costs of the Project and specifically all or a portion of the cost of the acquisition of its leasehold interest in such real property from the City through the issuance of its Guaranteed Lease Revenue Note (the “Note”) in a principal amount not to exceed $1,085,000; and

WHEREAS, the Note shall be issued under and pursuant to a resolution of the Authority; and

WHEREAS, the proceeds derived from the issuance of the 2018 Note are to be applied to the costs of the Project which will benefit the Authority and the City; and

WHEREAS, the City desires that the Authority issue the Note in a principal amount not to exceed $1,085,000 and apply the proceeds as aforesaid and is willing to enter into a sublease and guaranty agreement (the “Sublease and Guaranty Agreement”) in order to enhance the marketability of the Note and thereby achieve interest cost and other savings with respect to the Project and as an inducement to the purchase of the Note; and

WHEREAS, the obligation of the City under the Sublease and Guaranty Agreement constitutes lease rental debt under the Local Government Unit Debt Act, Act No. 177 of 1996, approved December 19, 1996, as amended (the “Debt Act”); and

WHEREAS, the Debt Act requires certain actions as a prerequisite to incurring lease rental debt;

NOW, THEREFORE, BE IT ORDAINED by the Council (the “Council”) of the City of Hazleton, Pennsylvania, as follows:

Section 1. The City authorizes and requests the Authority to undertake and proceed with the Project.  The City hereby declares the guaranty of the Authority’s Note, the proceeds of which will be used for the Project, to be a project of the City for which lease rental debt is to be incurred in a principal amount not to exceed $1,085,000.

Section 2.  The City hereby declares the Project to be desirable for the health, safety and welfare of the residents of the City.

Section 3.  The realistic estimated useful life of the project of the Authority to be financed with the proceeds of the Note is hereby declared to be not less than 20 years.  

Except as permitted by the Debt Act, stated installments or maturities of principal of the Note will not be deferred beyond the later of one year after the estimated date for the completion of the construction portion of the Project, if any, or two years from the date of issuance of the Note.

The City hereby finds and certifies that realistic cost estimates have been obtained for the costs of the Project from financial analysts, registered architects, professional engineers or other persons qualified by experience to provide such estimates.

Section 4.  The City hereby authorizes the incurring of lease rental debt in the form of the Sublease and Guaranty Agreement to secure the payment of principal or redemption price of, and interest on, the Note which the Authority proposes to issue to provide funds for and toward the costs of the Project. The City determines that the Authority shall incur debt, which shall be lease rental debt of the City pursuant to the Debt Act, for the purposes of the Project; and hereby declares that such lease rental debt is within the limitations imposed by law upon the incurring of debt by the City.  The City hereby covenants with the holders of the Note that it (i) shall include the amounts payable in respect of the Sublease and Guaranty Agreement for each fiscal year in which such sums are payable in its budget for that year, (ii) shall appropriate such amounts to the payment of such Sublease and Guaranty Agreement, and (iii) shall duly and punctually pay or cause to be paid the amount payable in respect of the Sublease and Guaranty Agreement on the dates and places and in the manner stated in the Sublease and Guaranty Agreement according to the true intent and meaning thereof.  For such budgeting, appropriation and payment the City does hereby pledge its full faith, credit and taxing power. As provided in the Debt Act, the foregoing covenant shall be specifically enforceable.

The maximum amounts required to be paid under the Sublease and Guaranty Agreement from the general revenues of the City are set forth as Exhibit A hereto.  Exhibit A is incorporated herein by reference with the same force and effect as if fully set forth in the text hereof.  Proper officers of the City are hereby authorized and directed to make any payment required under the Sublease and Guaranty Agreement.

The City hereby establishes a "sinking fund," as such phrase is defined or applied in the Debt Act, as amended and supplemented from time to time, with respect to its obligations under such Sublease and Guaranty Agreement, and the purchaser of the Note, which shall be a bank or bank and trust company authorized to do business in the Commonwealth, is hereby appointed "sinking fund depositary" and "paying agent," as such phrases are defined or applied in the Debt Act, as amended and supplemented from time to time, to the extent necessary with respect to obligations of the City under such Sublease and Guaranty Agreement.

Section 5.  The President or Vice President of the Council and the City Clerk or any duly appointed successor to any thereof, as the case may be, are hereby authorized and directed to prepare, certify and file with the Department of Community and Economic Development (the "Department"), in accordance with the Debt Act, a debt statement required by Section 8110 thereof; and the President or Vice President of the Council and the City Clerk or any duly appointed successor to any thereof, as the case may be, are hereby authorized and directed to prepare and execute a certificate stating the City’s borrowing base, as such term is defined in the Debt Act, for submission to the Department and, in connection with such application, the City shall pay or cause to be paid to the Department the filing fee required by the Department, the payment of which filing fee is authorized and approved.

Section 6.  Subject to Section 8 hereof, the Mayor of the City and the President or Vice President of the Council, attested to by the City Clerk or any duly appointed successor to any thereof, as the case may be, are hereby authorized and directed to execute and deliver and to affix and attest the corporate seal of the City to, the Sublease and Guaranty Agreement in such form as the solicitor or special counsel to the City may advise and the officers executing the same may approve, their approval and the conclusive approval of the City to be evidenced by their execution thereof and to take any other actions necessary to effectuate the Project.

Section 7.  All prior ordinances or parts thereof inconsistent herewith are hereby repealed.

Section 8.  The Sublease and Guaranty Agreement shall be executed and delivered as provided in Section 6 hereof and the Lease Agreement shall be executed and delivered as provided in Section 9 hereof only after the Department shall have approved the incurrence by the City of the lease rental debt evidenced by this Ordinance pursuant to the Debt Act.

Section 9.  Subject to Section 8 hereof, the Mayor of the City and the President or Vice President of the Council, attested to by the City Clerk or any duly appointed successor to any thereof, as the case may be, are hereby authorized and directed to execute, attest, seal and deliver the Lease Agreement in such form and identifying such property to be subject to the Lease Agreement as the officers of the City executing said document shall deem necessary and appropriate with the advice of the solicitor or special counsel to the City.  The execution, attestation and delivery of the Lease Agreement by appropriate officers of the City shall constitute conclusive evidence of such approval and the approval of the City.

Section 10.  The proper officers of the City are hereby authorized and directed to execute, attest and deliver any and all necessary or appropriate documents and to do any and all necessary or appropriate things in connection with the transactions hereby contemplated, including, without limitation, approving the commitment letter relating to the Note of the purchaser of the Note presented to the Authority and the City.

Section 11.  The City appoints Stevens & Lee, P.C. to act as Bond Counsel to the City and Financial S&Lutions LLC to act as Municipal Advisor to the City in connection with the issuance of the Note and to facilitate the intent of this Ordinance.

Section 12.  Reference in the Ordinance to specified officers of the City shall include and shall be construed to include, if and as applicable, their respective successors in office.

Section 13.  This Ordinance shall become effective in accordance with provisions of Section 8103 of the Debt Act.

Section 14.  If any section, clause, provision or portion of this Ordinance shall be held invalid or unconstitutional by any Court of competent jurisdiction such decision shall not affect any other section, clause, provision or portion of this Ordinance so long as it remains legally enforceable minus the invalid portion.  The City reserves the right to amend this Ordinance or any portion thereof from time to time as it shall deem advisable in the best interest of the promotion of the purposes and intent of this Ordinance, and the effective administration thereof.

Section 15.  This Ordinance shall become effective immediately upon approval as required by law.

DULY ENACTED by the City of Hazleton, Luzerne County, Pennsylvania this 14th day of November, 2018.

CITY OF HAZLETON

Luzerne County, Pennsylvania

By:                                                                             

                              Mayor

By:                                                                             

                     President of Council

Attest: ___________________________________
                            City Clerk


 

 

 

 

 

 

 

 

 

 

 

 

 



EXHIBIT A

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