A resolution authorizing and providing for the financing of the construction of a water facilities project, including authorizing the execution of applications, contractual agreements, and other necessary documents, and making certain representations, certifications, and pledges of certain revenue in connection with such financing.
WHEREAS, The Metropolitan Government of Nashville and Davidson County is a public corporation in the State of Tennessee (the "Metropolitan Government"); and
WHEREAS, the Metropolitan Government has determined that it is necessary and desirable to undertake certain activities or tasks in connection with a water facilities project, Department of Environment and Conservation Number DG8 2020-223 (the "Project"), in and for the Metropolitan Government; and
WHEREAS, Drinking Water Revolving Loan Fund Act of 1997, Tennessee Code Annotated, Sections 68-221-1201 et seq., (the “Act”) provide for the lending of funds in the water facilities Revolving Loan Fund to Local Governments for the purpose of providing funds for project loans; and
WHEREAS, the Metropolitan Government has determined that it is necessary and advisable to borrow funds for the Project pursuant to the Act.
NOW, THEREFORE BE IT RESOLVED BY THE METROPOLITAN COUNTY COUNCIL OF THE METROPOLITAN GOVERNMENT OF NASHVILLE AND DAVIDSON COUNTY:
Section 1. The creation of indebtedness on behalf of the Metropolitan Government in the principal amount of five million dollars ($5,000,000) by the obtaining of a project loan is hereby approved.
Section 2. The Director of Finance, or his designee, is hereby authorized to execute and deliver the application for a project loan in the principal amount of five million dollars ($5,000,000) (the “Application”), attached hereto as Exhibit A, for the purpose of funding a portion of the total estimated cost of the Project, which is thirty-two million, four hundred ninety-three thousand dollars ($32,493,000).
Section 3. The form, terms, and provisions of the agreement for the project loan among the Metropolitan Government, the Tennessee Department of Environment and Conservation and the Tennessee Local Development Authority (the "Loan Agreement"), as attached hereto in Exhibit B, are hereby approved.
Section 4. The Metropolitan Government hereby agrees to honor and accept the method of financing as may be determined by the Tennessee Local Development Authority pursuant to the Loan Agreement.
Section 5. The Metropolitan Government hereby agrees to make monthly payments on the project loan in accordance with a Payment Schedule, which shall be determined upon substantial completion of the Project and attached to the Loan Agreement. Such monthly payment shall be made in equal installments for a period extending no longer than twenty years from the date of substantial completion of the Project.
Section 6. The Metropolitan Government hereby agrees to levy fees, rates or charges for services provided by the Project and/or to levy ad valorem taxes sufficient to pay the interest on and principal of the Project loan in accordance with the Loan Agreement. The Metropolitan Government also agrees to levy fees, rates, or charges and/or ad valorem taxes sufficient to pay the cost of operation and maintenance of the water system of which the Project is a part, which cost shall include depreciation and all other debt service expense of the system.
Section 7. The Metropolitan Government assigns and pledges its Unobligated State-Shared Taxes to the State and consents to the withholding and application of State-Shared Taxes in the event of failure by the Metropolitan Government to remit monthly payments in accordance with the terms of the Loan Agreement, as the Loan Agreement may be supplemented or amended from time to time.
Section 8. The Metropolitan Government hereby agrees that there are no local pledges of State-Shared Taxes other than those disclosed in the Application.
Section 9. The Metropolitan Government hereby agrees to obtain alternative methods of financing for all costs necessary for the completion of the Project which are in excess of the combined financing provided by any agency of the United States Government and by the Tennessee Local Development Authority.
Section 10. The Director of Finance, or his designee, is authorized and directed to execute the Loan Agreement, and any amendments of supplements to the Loan Agreement, in the name and behalf of the Metropolitan Government; to deliver such documents to the other parties to such documents, such execution and delivery to be conclusive proof of the approval of the Metropolitan Government of such documents; and to take such further action and to execute and deliver such further instruments or documents as the Director of Finance, or his designee, may consider necessary or advisable in connection with the Loan Agreement. Provided, however, this resolution shall not be deemed to grant authority to the Director of Finance, or his designee, to approve any increase in the amount of the Project loan.
Section 11. The Metropolitan Government intends for the Loan Agreement to constitute an additional series of revenue debt obligations issued under the authority of Substitute Resolution No. RS2010-1442, adopted by the Metropolitan County Council on November 16, 2010, as heretofore supplemented and amended (the “Water and Sewer Bond Resolution”), Capitalized terms in the remainder of this Section 11 shall have the meanings ascribed by the Water and Sewer Bond Resolution. As a series of debt obligations issued under the Water and Sewer Bond Resolution, the Loan Agreement will be payable from and secured by the Trust Estate on parity with the Metropolitan Government’s outstanding Series 2010 Bonds, Series 2013 Bonds, Series 2017 Bonds, and Series 2020 Bonds. The Loan Agreement shall not constitute an Additionally Secured Series for purposes of the Water and Sewer Bond Resolution. For purpose of the Water and Sewer Bond Resolution, the Metropolitan Government hereby appoints the Director of Finance to serve as the Paying Agent for the Loan Agreement. There shall be no Bond Registrar with respect to the Loan Agreement.
Section 12. All orders, resolutions, or ordinances in conflict with this resolution are and the same are repealed insofar as such conflict exists.
Section 13. This Resolution shall take effect from and after its adoption, the welfare of the Metropolitan Government requiring it.
Bob Mendes, Angie Henderson
Referred toBudget and Finance Committee
Public Works Committee
IntroducedApril 7, 2020
Substitute AdoptedApril 7, 2020
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Last Modified: 04/13/2020 11:54 AM