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HomeMy WebLinkAbout1 RDA Packet 5.1.24Agenda Scheduled Meeting May 1, 2024 – 9:00 am BPW Conference Room, 13th Floor or via: https://tinyurl.com/RDA050124 1.Roll Call 2. Approval of Minutes A. Approval of Minutes of the Scheduled Meeting March 26, 2024 3.New Business A.Resolution No. 217 (Four Winds Field at Coveleski Stadium 2024 RDA) 4.Adjournment ITEM 1 March 26, 2024 – 10:00 am BPW Conference Room, 13th Floor or via: http://tiny.cc/RDA032624 The meeting was called to order at 11:00 am 1.ROLL CALL Members Present: Redevelopment Staff: Legal Counsel: Attending: Erin Linder Hanig, President - V Anthony Fitts, Vice-President - V Richard Klee, Secretary - IP Mary Sears, Board Secretary Sandra Kennedy, Esq. Danielle Campbell Weiss, City Attorney Caleb Bauer, Executive Director Community Investment Erik Glavich, Director Growth & Opportunity Sarah Schaefer, Deputy Director Community Investment Eric Horvath, Director Public Works Randy Rampola, Barnes, and Thornburg Jordan Smith, South Bend Tribune Richard Nussbaum Jennifer Huddleston KM 2.ELECTION OF OFFICERS Secretary Klee suggested to keep the current slate of officers from 2023 to 2024. Upon a motion by President Linder Hanig seconded by Vice-President Fitts, the motion carried unanimously, the Authority approved the 2024 slate of officers on March 26, 2024. ITEM 2A Page | 2 3.APPROVAL OF MINUTES A.Approval of Minutes of the Regular Meeting of February 10, 2023 Upon a motion by President Linder Hanig and seconded by Vice-President Fitts, the motion carried unanimously, the Authority approved the Minutes of the Meeting of February 10, 2023. 4.NEW BUSINESS A.South Bend Redevelopment Authority Lease Bonds 2024 (Four Winds Field at Coveleski Stadium Project) B.Resolution No. 216 (Approving Lease City of South Bend Four Winds Field Project) Randy Rampola, Barnes, and Thornburg Presented Resolution No. 216. Randy Rampola, Barnes & Thornburg, stated these are related to the proposed improvements to Four Winds Field in means to finance the improvements. The Indiana code was amended a couple of years ago to allow for the expansion of the professional Sports Development areas in South Bend. This significantly increased revenues available for this project in the city. The revenues available are up to $5M. The lease revenue provided for a maximum lease rental of $4.76M for a term not to exceed twenty-years as part of the lease structure then that would also accompany the tax back up. We would then go into the bond market and get the best rating at the lowest interest rate, which allows the proceeds to be realized at the $45M level in the most efficient way. The revenues that are pledged by Common Council as part of their approval would be those PSCDA revenues. The city’s municipal advisor Crowe as done a similar analysis. They have worked with the Department of Revenue to show that the revenues going back before this area was created would generate well north of the $5M that would be available in the statute. Even during COVID the area’s revenue was just under $7M. Sales tax is also captured but it is the income tax that provides the historical coverage. Today’s action is asking the commission to approve Resolution No. 216. The Redevelopment Authority would issue Bonds. The proceeds of those bonds would be used to pay for the cost of improvements. The reason why we are using this lease mechanism is to provide the ability for the Commission to have a tax backup. The lease rental is set as a maximum of $4.76M. In section two of the lease which has the lease rental also states that once the bonds are sold, the lease rental will be reduced to match the exact debt service. That is the high side number that Crowe is estimating using the high side interest rate market. We need to have the maximum because we won’t be selling the bonds until June Page | 3 2024, and we do not know if rates will be higher or lower. We start out with the maximum. The lease rental revenue is for 20 years through 2044. The lease rent on debt service will be lower than that and provide coverage. That would allow that extra coverage to 33% to 35% annually. On March 28, 2024, the Redevelopment Commission will hold a hearing. We would ask the Redevelopment Authority as well as Common Council for approval of the lease as well as their pledge of these revenues to be able to make the lease payments. Following that we would go for a rating and a bond sale. Right now, we would have the bond sale around Memorial Day which allows us to close early June 2024. Secretary Klee asked for a broader view of the project and scope of work. Eric Horvath, Director Public Works noted that the project will modernize the existing stadium infrastructure, adding a full second level above the existing facility, renovating the primary seating areas and suites, adding a new 20,000 square foot four-story club and event space building and a new playground and splash pad with additional restrooms and space for retail and concession areas. The general project is estimated at $45M in construction cost. The first step is approving this resolution today so we can close in June to make the 2024 construction season right after ball season in September. Construction could immediately start the first stage and run through the off-season. Construction would continue through 2025 and be able to have it ready for opening day in 2026. Secretary Klee asked about the interest rate Mr. Rampola stated that the Fed meeting is in April. We expect the May rates to be slightly lower, but it is still too far out to predict with any degree of certainty. We believe that the city will again receive an AA rating which will then be on the lower edge of interest rates. Vice-President Fitts asked about item #12 on the lease. The lease calls for a version of the property to go back to lessee if the lessee fails. Is this accurate? Mr. Rampola states that during the term of the lease, which would be the stadium itself, it would be owned by the Redevelopment Authority as the lessor. The park board and the city would transfer title to the Redevelopment Authority. The park board will continue to operate the facility. At the end of the bond, the property will be transferred back to the park board. Closed the Commission portion and Opened the Public portion Page | 4 Dick Nussbaum, attorney at 210 S Michigan St., South Bend 46601. Mr. Nussbaum states that he has been involved with the stadium since the beginning in one capacity or another. About a year ago he was a member of a team that was able to get some legislation passed with the help of other local representatives. This legislation expanded the professional sports development area in South Bend and extended the time frame within which revenues could be collected so that a revenue stream of $100M every twenty years was created. You hope that things will happen. The revenue stream is happening because it started in July at the level $5M a year and it is generating in excess of that. It is great to see this come to fruition without any tax levy. It is nice to say that we have a tax backup, but no tax backup will be used. We have made it clear to the public that it is being captured and kept here is this community. It is nice to provide an asset in terms of the ability of our team to stay in South Bend due to additional standards that major league baseball is putting forth on major teams. There are other communities that are trying to meet the expectations. He feels that this will only enhance the profitability of the team and create additional revenues for the City of South Bend. Closed the Public portion and asked for any final Commission Comments Upon a motion by President Linder Hanig and seconded by Vice-President Fitts, the motion carried unanimously, the Authority approved Resolution No. 216 (Bond Resolution SB 2023 Projects Financing) on February 10, 2023. 5.ADJOURNMENT The Authority adjourned the meeting at 11:17 am. ______________________________ ______________________________ Anthony Fitts Rick Klee South Bend Redevelopment Authority South Bend Redevelopment Authority ______________________________ Erin Linder Hanig South Bend Redevelopment Authority RESOLUTION NO. 217 A RESOLUTION OF THE SOUTH BEND REDEVELOPMENT AUTHORITY AUTHORIZING THE ISSUANCE OF SOUTH BEND REDEVELOPMENT AUTHORITY LEASE RENTAL REVENUE BONDS OF 2024 (FOUR WINDS FIELD AT COVELESKI STADIUM PROJECT) AND ALL MATTERS RELATED THERETO WHEREAS, the South Bend Redevelopment Authority (the “Authority”) has been created pursuant to Indiana Code 36-7-14.5 (the “Act”) as a separate body corporate and politic serving as an instrumentality of the City of South Bend, Indiana (the “City”) to finance local public improvements for lease to the South Bend Redevelopment Commission (the “Commission”); and WHEREAS, the City has determined to undertake certain improvements to the Four Winds Field at Coveleski Stadium (the “Stadium”) consisting of enhancements to the Stadium including, without limitation, modernizing the existing Stadium infrastructure, adding a full second level above the existing facility, renovating the primary seating areas and suites, adding a new 20,000 square foot, four-story club and event space building, and a new playground and splash pad with additional improvements including, without limitation, additional restrooms, additional circulation space, updated retail and concessions areas, a new improved entrance, and all projects related to the foregoing projects (collectively, the “Project”) for the purpose of increasing the Stadium’s capacity and providing for increased future success; and WHEREAS, on March 27, 2024, at a duly noticed public meeting, the Authority did adopt its Resolution No. 216, whereby the Authority (a) stated its intent to issue its South Bend Redevelopment Authority Lease Rental Revenue Bonds of 2024 (Four Winds Field at Coveleski Stadium Project) (the “Bonds”) in an aggregate principal amount not to exceed Fifty Million Two Hundred Fifty Thousand Dollars ($50,250,000), to (i) finance all or a portion of the cost of the Project; (ii) fund a debt service reserve fund, if necessary in connection with the issuance of the Bonds; and (iii) pay costs incurred in connection with the issuance of the Bonds; and WHEREAS, the Authority now seeks to duly authorize the issuance of the Bonds pursuant to the Act to provide funds for the payment of the costs of funding a portion of the Project, a reserve fund, if necessary, and the costs of issuance of the Bonds and to authorize and approve such actions as may be necessary to provide for the sale and issuance of the Bonds; NOW, THEREFORE, BE IT RESOLVED BY THE SOUTH BEND REDEVELOPMENT AUTHORITY, AS FOLLOWS: SECTION 1. In order to pay and finance the costs of the Project, funding a reserve fund, if necessary, and paying the costs of issuing the Bonds, the Authority shall borrow an amount not to exceed Fifty Million Two Hundred Fifty Thousand Dollars ($50,250,000) through the issuance and sale of its Bonds. The Bonds shall bear interest at a rate or rates not exceeding six percent (6.00%) per annum, and shall mature on February 1 and August 1 of each year, beginning not earlier than August 1, 2025, with a maximum term of not to exceed twenty (20) years, as finally set forth in the Indenture (as defined herein) at the time of the execution and delivery of the Bonds to the purchaser or purchasers thereof. Interest on the Bonds shall be payable semiannually on February 1 and August 1 of each year beginning not earlier than February 1, 2025. SECTION 2. The Bonds shall be subject to optional redemption by the Authority prior to maturity on any date no sooner than seven (7) years after the date of issuance of the Bonds, with ITEM 3A 2 final redemption provisions to be set forth in the Indenture (as defined herein), on thirty days’ notice, in whole or in part, in order of maturity as determined by the Authority, and by lot within a maturity, at face value plus accrued interest to the date fixed for redemption. The Bonds may be subject to mandatory sinking fund redemption if so determined by the winning bidder for the Bonds. The final redemption terms shall be as set forth in the Indenture at the time of the execution and delivery of the Bonds to the purchaser or purchasers thereof. SECTION 3. The Authority hereby appoints U.S. Bank Trust Company, National Association to serve as trustee (the “Trustee”) for the Bonds to be issued by the Authority. The Trustee shall be charged with and shall by the Indenture (as defined herein) undertake the duties and responsibilities customarily associated with such position, as evidenced by the Indenture. SECTION 4. The Bonds shall be issued in accordance with and shall be secured by a Trust Indenture to be dated as of the first day of the month in which the Bonds are issued (the “Indenture”), between the Authority and the Trustee, and the President and/or Vice-President and/or the Secretary-Treasurer of the Authority are hereby authorized to approve and execute the form of the Indenture containing provisions necessary or appropriate to effectuate these resolutions and to consummate the sale and issuance of the Bonds, said officers’ execution and attestation thereof to be conclusive evidence of their approval of such Indenture. Upon its execution, the Secretary-Treasurer is authorized and directed to place a copy of the Indenture in the minute book immediately following the minutes of this meeting and said Indenture is made a party of this Resolution as if the same were fully set forth herein. SECTION 5. The Authority hereby directs Crowe LLP, as municipal advisor to the Authority (the “Municipal Advisor”) to prepare an Official Statement for the Bonds for distribution in such manner, at such times, for such periods and in such number of copies as may be required pursuant to Rule 15c2- 12 promulgated by the United States Securities and Exchange Commission (the “Rule”) and any and all applicable rules and regulations of the Municipal Securities Rulemaking Board. The President or any other Officer of the Authority is hereby authorized to approve the Official Statement and the President or any other Officer of the Authority is hereby authorized to deem and determine the Preliminary Official Statement as the Near Final Official Statement with respect to the Bonds for purposes of the Rule, subject to completion in accordance with such Rule and in the manner acceptable to such Officer of the Authority, and to place the Preliminary Official Statement into final form as the Final Official Statement (the “Final Official Statement”). The President or any other Officer of the Authority is authorized to sign the Final Official Statement and by such signature approve its distribution. SECTION 6. The Authority authorizes the Bonds to be sold by a negotiated sale as provided herein. The Authority hereby authorizes the Controller of the City (the “Controller”) to act on behalf of the Authority with respect to all actions necessary to provide for the sale of the Bonds. The Bonds shall be sold through a negotiated sale in the manner and upon the terms and conditions set forth in a bond purchase agreement (the “Bond Purchase Agreement”) between the Authority and an underwriter, bank, financial institution or other purchaser to be selected by the Controller on behalf of the Authority, at such prices and on such terms as may be determined at the time of such sale and approved by the Controller on behalf of the Authority. The President or any other officer of the Authority is hereby authorized and directed to execute and deliver the Bond Purchase Agreement in the form approved by the President or any other officer of the Authority in the name and on behalf of the Authority as evidenced by the execution thereof and the Secretary- Treasurer or any other officer of the Authority is hereby authorized and directed to attest such 3 execution. Such Bond Purchase Agreement may set forth the definitive terms and conditions for such sale, but all such terms and conditions must be consistent with the terms and conditions of this Resolution, including without limitation, the interest rate or rates on the Bonds, which shall not exceed the maximum rate of interest for the Bonds authorized pursuant to this Resolution. SECTION 7. Prior to the delivery of the Bonds the Secretary-Treasurer shall be authorized to obtain a legal opinion as to the validity of the Bonds from Barnes & Thornburg LLP, bond counsel for the Authority, and to furnish such opinion to the purchaser or purchasers of the Bonds. The cost of such opinion shall be considered as part of the costs incidental to the issuance of the Bonds and shall be paid out of proceeds of said Bonds. SECTION 8. If the Controller, with the advice of the Municipal Advisor to the Authority, determines that market conditions at the time of the sale of the Bonds are such that the Authority is able to finance the Project and related expenses by issuing Bonds in an aggregate principal amount which is less than $50,250,000, then the Controller, on behalf of the Authority, shall provide for the sale of, and the Authority shall issue, such lesser principal amount of Bonds. SECTION 9. The President or any officer of the Authority or the Controller is authorized and directed to take all steps necessary to procure a rating on the Bonds and/or obtain bond insurance and/or a reserve fund policy for the Bonds to the extent such officer determines, with the advice of the Municipal Advisor, that such rating, insurance, and/or reserve fund policy may be in the best interest of the Authority. SECTION 10. Each Officer of the Authority and the Controller is hereby authorized and directed to take all such actions and to execute all such instruments as such Officer or Officers deem necessary or desirable to carry out the transactions contemplated by this Resolution, including executing a Continuing Disclosure Contract with respect to the Bonds in compliance with the Rule, in such forms as the Officer or Officers executing the same shall deem proper, to be evidenced by the execution thereof. Any such documents heretofore executed and delivered and any such actions heretofore taken be, and the same hereby are, ratified and approved. SECTION 11. This Resolution and the Indenture upon execution shall constitute a contract between the Authority and the holders of the Bonds, and, after the issuance of the Bonds, this Resolution shall not be repealed or amended in any respect which would adversely affect the rights of such holders so long as the Bonds, or the interest thereon remains unpaid. SECTION 12. This Resolution shall be in full force and effect from and after its passage by the Authority. ***** 4 ADOPTED at a meeting of the South Bend Redevelopment Authority held on May 1, 2024, in Room 1308 of the County-City Building, 277 West Jefferson Boulevard, South Bend, Indiana 46601. SOUTH BEND REDEVELOPMENT AUTHORITY Erin Hanig, President ATTEST: Richard Klee, Secretary DMS 42903739v3