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HomeMy WebLinkAboutAmend the Amended Agreement of Operations between St Joseph County Hotel Motel Tax Board of Managers F f C • a ORDINANCE No. 8278-92 Passed by the Common Council of the City of South Bend, Indiana. July 13, 92 r9 �a, City Ci y Cier k IRENE K. GAMMON Attest: - �►•� i President of Common Council Sr Presented by me to the Mayor of the City of South Bend, Indiana— July 14, 92 19 City Clerk IRENE K. GAMMON Approved and signed by me July 14 /992 o • Z. Mayor • • % t • + a ORDINANCE NO. g ' .'1 $-c(o. AN ORDINANCE AUTHORIZING THE CITY OF SOUTH BEND, INDIANA TO AMEND THE "AMENDED AGREEMENT OF OPERATIONS BETWEEN ST. JOSEPH COUNTY HOTEL- MOTEL TAX BOARD OF MANAGERS AND SOUTH BEND CIVIC CENTER BOARD OF MANAGERS AND CITY OF SOUTH BEND" STATEMENT OF PURPOSE AND INTENT: , The City of South Bend, Indiana (the "City") is party to an "Amended Agreement of Operations between St. Joseph County Hotel- Motel Tax Board of Managers and South Bend Civic Center Board of Managers and City of South Bend" , dated February 14 , 1983 (the "Agreement") . A copy of the Agreement is attached as Exhibit A. This Common Council and the Mayor of the City deem it advisable and in the best interests of the City and its citizens to improve South Bend Century Center and Studebaker National Museum, both in the City, or to assist in providing an :alternate site for Studebaker National Museum, which facilities are used for meetings, conventions, entertainment spectaculars, displays of industrial or cultural value, and/or other cultural, governmental, educational, recreational, exhibition, or civic purposes. IC 6-9-1 mandates the levy of a countywide tax in St. Joseph County, Indiana on every person engaged in the business of renting or furnishing, for periods of less than thirty days, any room or rooms, lodgings or accommodations in any commercial hotel, motel, inn, tourist camp, or tourist cabin (the "Hotel-Motel Tax") . The Hotel-Motel Tax is collected by the St. Joseph County Treasurer, and deposited in the County' s convention and exhibition center fund (the "Fund") . The special funds board of managers created by IC §6-9-1-2 (the "Hotel-Motel Tax Board of Managers") has the authority to expend funds generated from said Hotel-Motel Tax levy for purposes which include financing, constructing, improving and promoting any capital improvement in the nature of a convention and exhibition center, and renovating, equipping, operating and maintaining any • y Y generated from the Hotel-Motel Tax levy, in order to finance the improvements described above. In Ordinance No. 16-92 (as amended, the "Bond Ordinance") , St. Joseph County has authorized the issuance of such bonds, to be issued in the amount of approximately $3 , 300, 000 (the "County Bonds") , repayable from said tax levy, for the purpose of providing funds to be applied to pay for said improvements and incidental expenses in connection therewith and on account of the issuance of the County Bonds. Under the Agreement, the City is entitled to receive each year One Hundred Fifty Thousand Dollars ($150, 000) from said tax levy in consideration for operating and maintaining Century Center. The Agreement also provides that tax moneys received by the Hotel-Motel Tax Board of Managers each year shall be first applied to such $150, 000 payment. The Agreement also requires, subject to certain conditions, that said tax revenues be applied to losses incurred in the operation of Century Center. In order to carry out the desires of the City set forth herein and to enhance the marketability of the County Bonds, the City deems it advisable to apply collections from said tax levy each year first to the payment of the County Bonds, and second for the building or restoration of the debt service reserve account for the County Bonds. The City wishes to amend the Agreement in this Ordinance in order to carry out the intent of this paragraph, and believes such amendments as are set forth herein will not adversely affect the rights or interests of the owners of the bonds designated "South Bend Civic Center Building Authority Civic Center Refunding Bonds" due to the facts that revenues of the Hotel-Motel Tax are substantially in excess of those available at the time said bonds were issued, and that said bonds are supported by a lease, with the City as lessee, and the City is required to levy ad valorem taxes to pay the lease rental. muP t , • Section 1. The first sentence of Section 3 of the Agreement is hereby deleted. Section 2 . A new Section 13 is added to the Agreement, which reads as follows: The parties hereto understand that St. Joseph County, Indiana has issued bonds designated as "The Board of Commissioners of the County of St. Joseph, Indiana Special Tax Bonds of 1992 (Limited Obligations) , and that said bonds are repayable from the Hotel-Motel Tax. Notwithstanding anything herein to the contrary, collections from the Hotel-Motel Tax shall be applied as set forth in Ordinance No. 16-92 of St. Joseph County, Indiana, adopted by the St. Joseph County Council on March 10, 1992 , and approved by the Board of Commissioners of the County of St. Joseph on March 17 , 1992, as amended and as the same may be further amended or supplemented hereafter. The obligations of the parties hereunder shall be fully subject to said provisions of said Ordinance No. 16-92 , as amended. Section 3 . It is understood and agreed that the Bond Ordinance will require that the collections from the Hotel-Motel Tax be applied, used and withdrawn as set forth below, and that such money available for payment of debt service on the County Bonds is held in trust and is irrevocably pledged for the purposes set forth below: (a) Bond Principal and Interest Account. On each July 20, October 20, January 20 and April 20, there shall be deposited in the Bond Principal and Interest Account of the Fund an amount of money from the Fund, to the extent of available funds in the Fund, which together with any money contained in the Bond Principal and Interest Account is sufficient to pay one-third of the principal of and interest and premium (if any) on the County Bonds, and any additional bonds hereafter issued by St. Joseph County payable from the Hotel-Motel Tax (together, the "Special Tax Bonds") , coming due and payable during the twelve-month period commencing on the prior May 2 and ending on the following May 1. No such deposit need be made into the Bond Principal and Interest Account if the amount contained therein-is sufficient to pay such amounts so coming due and payable during said twelve-month period. All money in the Bond Principal and Interest Account shall be used and withdrawn solely for the purpose of paying the interest and premium (if any) on and the principal of the Special Tax Bonds as it shall become due and payable to the extent it is required therefor, including accrued interest on any such obligations purchased or redeemed prior to maturity. (b) Debt Service Reserve Account. On each July 20, October 20, January 20 and April 20, after first making any required deposit into the Bond Principal and Interest Account, there shall be set aside in the Debt Service Reserve Account of the Fund, from the Fund, any available the purpose of making payment on the Special Tax Bonds secured by the Debt Service Reserve Account in the event that no other money is lawfully available therefor, or to make the final payments on Special Tax Bonds when money in the Debt Service Reserve Account is sufficient to make all remaining payments to final maturity. So long as there is no default under the Bond Ordinance, any amount in the Debt Service Reserve Account in excess of the required debt service reserve shall be withdrawn and deposited in the Fund. (c) The remaining amounts in the Fund shall accumulate therein (outside of the Bond Principal and Interest Account and the Debt Service Reserve Account) and be available for (i) the purposes authorized by IC 6- 9-1 as of the date of original issuance of the County Bonds or by any amendments thereof or successor provisions thereto, and (ii) the payments required under the Agreement, all of which uses of remaining amounts in the Fund shall be subordinate and junior to the obligations set forth in (a) and (b) above. Section 4 . Money in the Fund shall be deposited to the reserve account for the County Bonds to the extent the required reserve is not provided from proceeds of the sale of the County Bonds. Section 5. The provisions of this Ordinance shall constitute a binding contract between the City and the holders of the County Bonds, and after issuance of the County Bonds this Ordinance shall not be repealed or amended in any respect, nor shall the Agreement be amended in any respect, which would adversely affect the rights or interests of the holders of the County Bonds as long as the County Bonds or interest thereon remains unpaid. Section 6. All ordinances or parts of ordinances in conflict herewith are hereby repealed. Section 7 . This Ordinance shall be in full force and effect when all of the following have occurred: 1. Adoption by this Common Council and approval by the Mayor; 2 . Approval of identical amendments to the Agreement, as set forth in Sections 1 and 2 of this Ordinance, by the Hotel-Motel Tax Board of Managers; 3 . Approval of identical amendments to the Agreement, as set forth in Sections 1 and 2 of this Ordinance, by the Century Center Board of Managers; and 4 4 . The issuance of the County Bonds by St. Joseph County, Indiana. SOUTH BEND COMMON COUNCIL S / ber I signed only to provide an opportunity for public discus3ion and Council action on the issue,. ftnmmtt#u &part Uhl tie Commit Counril of tip of*au* Rend: Your Committee of the Whole to whom was referred BILL NO. 58-92 SECOND READING ON A BILL AUTHORIZING THE CITY OF SOUTH BEND, INDIANA TO .AMEND THE "AMENDED AGREEMENT OF OPERATIONS BETWEEN ST. JOSEPH COUNTY HOTEL-MOTEL TAX BOARD OF MANAGERS AND SOUTH BEND CIVIC CENTER BOARD OF MANAGERS AND CITY OF SOUTH BEND" Respectfully report that they have examined the matter and that in their opinion This bill should be recommended to the Council favorable. Chairman Ann Puzzello -s • �����\\\\\ Az A. ' it�,�/ pl 11/ City of South Bend fi ls,`l.1$ .-.ra},� Joseph E. Kernan, Mayor Department of Administration and Finance Kevin C. Horton July 8, 1992 Mr. Steve Luecke South Bend Common Council 4th Floor, County-City Building South Bend, IN 46601 RE: An Ordinance Authorizing the City of South Bend, Indiana, to Amend the "Amended Agreement of Operations Between St. Joseph County Hotel-Motel Tax Board of Managers and South Bend Civic Center Board of Managers and City of South Bend" Dear Mr. Luecke: I am enclosing an ordinance authorizing the City of South Bend to amend the "Amended Agreement of Operations between St. Joseph County Hotel-Motel Tax Board of Managers and the South Bend Civic Center Board of Managers and City of South Bend." As you are probably aware, St. Joseph County intends to issue bonds repayable from hotel-motel tax revenues in order to finance certain improvements to Century Center and the Studebaker National Museum. The bond issue has been approved by the Hotel-Motel Tax Board, Board of County Commissioners of St. Joseph County, and Civic Center Board of Managers. The final approval needed in order to allow for sale and closing on the bonds is that of the South Bend Common Council. An existing agreement with the Hotel-Motel Tax Board of Managers, makes the annual payment to the Civic Center Board of Managers of $150,000 in hotel-motel tax revenues a priority use of those funds. The City, by this ordinance, is approving an amendment to that agreement in order to apply the collection of hotel-motel tax revenues first to the payment of these bonds. County-City Building • South Bend, Indiana 46601 • 219/284-9742 Fax 219/284-9892 Catherine A. Hubbard John D. Leisenring C. J. Cowsert Personnel Director Chief Deputy Controller Safety & Risk Manager 284-9124 284-9483 284-9482 Mr. Steve Luecke Page Two July 8, 1992 Marc C. Krcmaric, attorney with Barnes &Thornburg who is serving as the County' s counsel on this bond issue, informs me that closing on the bond issue is set for July 14, 1992, and that, consequently, the attached ordinance must be enacted prior to that time. This will require a rules suspension, in order to allow public hearing and vote on this ordinance by the Council at its July 13th meeting. We will make such a request at that time, and request favorable consideration of both that request and the attached ordinance. Sincerely,c, ifirl/ - 7,,: , evin C. Horton Controller KCH/j 1 Enclosure LM2/1LUECKE