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HomeMy WebLinkAbout85-1-2633221 ORDINANCE NO. 85-1-2633 AN ORDINANCE OF THE BOARD OF COMMISSIONERS OF PADUCAH, KENTUCKY, RELATING TO AND APPROVING AN INDUCEMENT CONTRACT BETWEEN THE CITY AND NEUROPSYCHIATRIC HOSPITAL OF PADUCAH, A PARTNERSHIP, IN WHICH THE CITY AGREES TO FINANCE THE ACQUISITION AND RENOVATION BY THE CON- STRUCTION OF CAPITAL.IMPROVEMENTS FOR AN ECONOMIC DEVELOPMENT PROJECT FOR USE AS A PSYCHIATRIC HOSPITAL ON A TRACT OF LAND LOCATED ON BROADWAY IN THE CITY, THROUGH THE ISSUANCE BY THE CITY OF NOT EXCEEDING -APPROXIMATELY $4,500,000 OF ECONOMIC DEVELOPMENT REVENUE BONDS, FOR THE PURPOSE OF CREATING ADDITIONAL EMPLOYMENT OPPORTUNITIES IN SAID CITY AND IN McCRACKEN COUNTY; AND AUTHORIZING THE BEGINNING OF THE ACQUISITION AND RENOVATION OF SAID PROJECT PRIOR TO THE ISSUANCE OF SAID BONDS, WITH SAID COMPANY PAYING FOR SAME AND TO BE REIMBURSED OUT OF THE PROCEEDS OF SAID BONDS FOR ALL COSTS HEREAFTER ADVANCED BY THE COMPANY TOWARD THE COST OF THE PROJECT. WHEREAS, it is necessary and desirable for the general welfare and economy of the City and its surrounding area that the City provide additional permanent opportunities for employment in the City and in such area; and WHEREAS, Neuropsychiatric Hospital of Paducah, a partnership (the "Company"), has submitted to the City a proposed Inducement Contract, in which the Company proposes to con struct and equip a new economic development project (the "Project"), on a tract of land of approximately 6.08 acres, located on Broadway in the City, which Project would be owned and operated by the Company; and WHEREAS, the Company has proposed in said Inducement Contract that if the City will agree to authorize, issue, and sell City of Paducah Economic Development Revenue Bonds in the amount of not exceeding approximately $4,500,000 pursuant to Sections 103.200 through 103.285 of the Kentucky Revised Statutes, for the purpose of financing the construction of the Project on said tract, and would lend the proceeds of the Bonds to the Company, the Company would agree to operate the Project and to make loan payments to the City sufficient to pay all principal and interest requirements of the Bonds as same become due; and WHEREAS, in the opinion of the Board of Commissioners of the City, the Project would relieve to some appreciable degree the condition of unemployment now existing in the City and its general economic area, and would tend to increase industry in the State in accordance with the public policy of the State, all as set forth in said Statutes; and WHEREAS, said plan of financing and the aforesaid Statutes contemplate that said Bonds would not be a general obligation debt of the City, but would be secured only by a foreclosable mortgage lien against and a first pledge of the revenues of the Project, which revenues would be derived by the City from loan payments from the Company sufficient to pay all principal and interest requirements of the Bonds; and WHEREAS, itis deemed advisable and in the best interests of the City that said Inducement Contract be approved and executed; NOW THEREFORE, BE IT ORDAINED BY THE CITY OF PADUCAH: 1. That the Inducement Contract referred to in the preamble hereto is hereby accepted and approved, said Contract contemplating that the City shall cause a new economic development project (the "Project"), to be acquired and renovated at the site of the old Sears building on Broadway in the City, which Project is to be financed by the issuance of 222 approximately $4,500,000 of City of Paducah Economic Development Revenue Bonds. 2. That the City shall cooperate fully with the Company and with Bond Counsel designated in said Inducement Contract (viz., Rubin & Hays, Suite 300, 209 South Fifth Street, Louisville., Kentucky 40202), in the issuance of the proposed Bonds in order.to induce said Company to locate and acquire, rehabilitate, and operate the Project on said site and thus''' create new opportunities for employment within the City and the surrounding area. 3. That the City agrees to enter into the appropriate Loan Agreement between the City and the Company and agrees that this Order commits the City insofar as the laws of the Commonwealth of Kentucky allow, (a) to issue.said Bonds and to lend the proceeds thereof"t.o .the Company, (b) to'adopt the appropriate Ordinance authorizing said Bonds; and (c)`to approve the appropriate Trust Indenture to secure the Bonds; provided all of the proceedings for the issuance of said Bonds must be approved by said Bond Counsel, and the governing body of the City. Since Kentucky law (KRS 103.230) permits the sale of such bonds to be made at a nego- tiated interest rate and price without public advertising, if such rate and price are agreeable to the Company, and since the Company desires that such Bonds be sold in that manner by nego- tiation, the City agrees to cooperate fully with the Company in effecting such negotiated sale. 4. That the Mayor is hereby authorized and directed to execute said Inducement Contract on behalf of the City and to execute all necessary documents, instruments, and obliga- tions of the City, in order to effectively carry out the"intent and purpose of this Ordinance and of said Contract, all without expense to the City. A copy of said Contract is hereby ordered to be made a part of this Ordinance the same as if copies in full herein, and such copy shall be filed in the records of the City with this Ordinance. 5. That the City hereby specifically approves and authorizes the beginning of acquisition and construction of the Project before all of the details of the issuance of the Bonds have been completed, with the agreement by the City in -the -Inducement Contract, that the Company may be reimbursed out of the proceeds of the Bonds when issued for any and all costs of the Project hereafter advanced by the Company. 6. That this approval is made subject to the condition that such Bonds shall not constitute a general obligation of the City and that the City shall have no expense in connec- tion with the Project or in connection with the issuance of the Bonds, all as provided in said Inducement Contract. 7. That the approval of the aforesaid Inducement Contract by the City shall be evidenced by the enactment of this Order by the governing body of the City and by the furnish- ing of a certified copy of same to the Company and to Bond Counsel. 8. That this Ordinance shall be in force immediately upon its enactment and ap- proval. INTRODUCED AND GIVEN FIRST READING ON DECEMBER 11, 1984. GIVEN SECOND READING, ENACTED AND APPROVED ON JANUARY 8, 1985. ATTEST: City Clerk (Seal of City) JOE VITERISI Mayor