10-28-19 Community Investment - Laserfiche WebLink

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CITY OFSOUTH BEND OFFICE OF THE CLERK Development Authority and NICTD went to our legislators and also discussed with our governor. At that point it was decided to provide$205 million in extra funding for the West Lake project and the double track project. The point in doing that was to not have to come back and ask the local participants for any more than what they originally agreed to fund. Mr. Pascarella continued, So, the State contribution got upped in a major way. In fact, we're now the largest contributor to these projects. However, I think what should be noted is that the legislators and the governor really support this project. And they did that because it wasn't just local politicians agreeing to that, it was the whole State who had to vote for that, and they voted overwhelmingly to fund the project. So therefore, I think you can see the commitment from the State and from Governor Holcomb that we are ready for a seed with funding this project. Which brings us to why we're here today. So, in order to get the funds from the Federal Government, we had to apply as Mike was talking for entry into engineering. And the Federal Government wants to make sure that when we do apply that we have a fully committed financial plan. They don't want to have empty promises and end up approving something only to find it fall through because the local or the State could not come up with financing. In doing so we put together a financial plan that had to be backed and voted on by the IFA board, the Northwest Regional Development Authority, and NICTD. Upon approval from those three (3) boards, then it went in front of the State budget committee in July, late June. We were able to get approval for that and we move forward, we submitted to the FTA, the FTA is looking at this project and as they're looking at the financing plan, they are watching to make sure that all the partners who agreed to fund, step up and make the proper approvals so they can fund and there's no additional unnecessary actions needed to be taken by the authorities. I can tell you that the State has already cleared its way and it has no further action needed. LaPorte County in a deal also with Michigan City has done the same, they fully funded their portion. And so has St. Joseph County. So, this is the last remaining piece that we have. And you know, we're very excited to be here tonight, because again, it is the last piece and against what we're asking your approval for tonight. The last piece is anytime you see a lot of funds being sent into a project fund. I want everybody to know here that also once those funds do come in, if the approval happens,they will be locked up. So, they can only be used for the double track project. So, your money will be protected. We want to make sure that that's obviously very important. I'd be happy to take any questions that you may have. Phil Faccenda, Barnes and Thornburg with offices located at 100 North Michigan Street, South Bend, IN, stated, I just want to briefly explain to you the bond financing and the resolution that's in front of you. It is a Redevelopment Authority bond issue that the Redevelopment Commission will lease property from the Redevelopment Authority. The reason for this structure is to maintain the Redevelopment Commission's two percent(2%) debt limit or the redevelopment district's two percent (2%) debt limit so it's a lease financing structure. There will be a portion of Cleveland Road that will be leased. It will then be transferred from the City to the Redevelopment Authority and leased because an asset needs to be leased as part of the lease. That asset will approximate the value of the bonds that are being issued. The bonds that will be issued are as reflected in your resolution, not to exceed $11 million. It is anticipated that the actual bond issuance at the time of pricing which will probably be in December. If the Council approves, and we make it through the rest of that bond schedule you see in front of you, the financing will probably be for less, and maybe as much as $1.5 million less than that. But it was seen as a not to exceed number, and necessary that in the event that the Redevelopment Commission should choose to use a debt service reserve fund, that was necessary for the dollar size of the bonding. It is not to exceed eleven (11) years in terms of the term of the bonds, and the interest rate, as reflected in your resolution will EXCELLENCE I ACCOUNTABILITY INNOVATION I INCLUSION I EMPOWERMENT 455 County-City Building 227 W.Jefferson Bvld South Bend,Indiana 46601 p 574.235.9221 f 574.235.9173 TTD 574.235.5567 www.southbendin.gov 3