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05-26-15 Agenda, Packet & Committee Meeting Notice
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05-26-15 Agenda, Packet & Committee Meeting Notice
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City Council - City Clerk
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Agendas
City Counci - Date
5/26/2015
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227 W. JEFFERSON BOULEVARD <br />SUITE 1400 S. <br />SOU1'H BEND, IN 46601 -1$30 <br />CITY OF SOUTH BEND PETE BUTTIGIEG, MAYOR <br />COMMUNITY INVESTMENT <br />SCOTT FORD, EXECUTIVE DIRECTOR <br />May 20, 2015 <br />Mr. Tim Scott, President <br />South Bend Common Council <br />4`h Floor County -City Building <br />South Bend IN 46601 <br />Dear President Scott: <br />PHONE: 574/235 -9371 <br />FAX: 574 /235 -9021 <br />Attached are the forms of Inducement Resolution for consideration by the Economic <br />Development Commission and the Common Council relating to the Noble Americas <br />Project. This resolution constitutes the initial action that the EDC and the Council will be <br />required to take with respect to the proposed financing by Noble Americas. This <br />resolution indicates that the Company is going to request that the EDC and the Council <br />give preliminary approval to increase the issuance of revenue bonds. Previously, the EDC <br />and Common Council approved an aggregate principal amount not to exceed <br />$25,000,000. This resolution would allow the Company to increase a revenue bond <br />issuance to an aggregate principal amount not to exceed $50,000,000. The proceeds <br />would be used for the improvements as described in the resolution and are applicable to <br />portions of the project at the Ethanol Plant that would qualify for tax- exempt pollution <br />control facility bond financing. <br />In order for the Company to qualify for tax - exempt financing, the governmental issuer <br />must issue revenue bonds and loan the proceeds from the sale of the bonds to the <br />Company. The City, through Indiana Code 36 -7 -12, would serve as the conduit issuer of <br />the bonds and loan the proceeds following the issuance thereof to the Company for <br />expenditure on qualifying project costs. The Company would have sole responsibility for <br />paying the debt service on the bonds. As evidenced in the resolutions, the City's credit <br />rating would not be affected by the issuance of these bonds, the City would bear no <br />responsibility to pay the debt service on the bonds, and in the event of a default by the <br />Company, and only the Company would bear the risk of that default. Once the issuance <br />process has been completed, the City would have no involvement with the bonds or the <br />payment of the debt service on the bonds. Typically, these bonds are secured by a bank <br />letter of credit in which the bank would make payments on the bonds in the event the <br />Company failed to do so. At such time, the bank would then seek reimbursement from <br />the Company under the letter of credit reimbursement agreement. Alternatively, it is <br />possible these bonds may be purchased directly by a bank which would take security <br />interests in the Company and/or the project financed. <br />PLANNING NEIGHBORHOOD ENGAGEMENT BUSINESS DEVELOPMENT ECONOMIC RESOURCES <br />JITIN KAIN PAMELA C. MEYER CHRIS FIELDING BROCK ZEEB <br />0 <br />
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