HomeMy WebLinkAbout2014-12-8207181547
ORDINANCE NO. 2014 —12 — 8207
AN ORDINANCE OF THE CITY OF PADUCAH, KENTUCKY,
APPROVING AND AUTHORIZING THE EXECUTION OF AN
INTERLOCAL COOPERATIVE AGREEMENT AMONG THE CITY
OF PADUCAH, KENTUCKY AND THE PADUCAH-MCCRACKEN
COUNTY CONVENTION AND VISITORS BUREAU FOR THE
COOPERATIVE FINANCING OF AN ECONOMIC DEVELOPMENT
PROJECT IN THE CITY OF PADUCAH, KENTUCKY
WHEREAS, the Paducah -McCracken County Convention and Visitors Bureau (the
"Bureau") have determined that it wishes to assist the City of Paducah in the repayment of the
City's Taxable General Obligation Bonds, Series 2014D in the approximate aggregate principal
amount of $4,325,000, which bonds are being issued by the City for the purpose of financing a
portion of the costs of the acquisition, construction, installation and equipping of an upscale hotel
(the "Project") on City owned property adjacent to the publically owned convention center,
generally known as the Julian Carroll and Paducah Expo Convention Center; and
WHEREAS, pursuant to Sections 65.210 to 65.300, inclusive, of the Kentucky
Revised Statutes, as amended (the "Interlocal Cooperative Act"), the City and the Bureau may
join together for the financing of the Project and their agreement as to same is memorialized into
an Interlocal Cooperative Agreement;
NOW THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE
CITY OF PADUCAH, KENTUCKY, AS FOLLOWS:
Section 1. Recitals and Authorization. The City of Paducah, Kentucky, hereby approves
the Interlocal Cooperative Agreement between the City and the Bureau in substantially the form
attached hereto as Exhibit A and made a part hereof.. It is hereby found and determined that the
Interlocal Cooperative Agreement furthers the public purposes of the City and it is in the best
interest of the citizens, residents and inhabitants of the City that the City enter into the Interlocal
Cooperative Agreement for the purposes therein specified and the execution and delivery of the
Interlocal Cooperative Agreement is hereby authorized and approved. The Mayor is hereby
authorized to execute the Interlocal Cooperative Agreement, together with such other
agreements, instruments or certifications which may be necessary to accomplish the transaction
contemplated by the Interlocal Cooperative Agreement with such changes in the Interlocal
Cooperative Agreement not inconsistent with this Ordinance and not substantially adverse to the
City as may be approved by the official executing the same on behalf of the City. The approval
of such changes by said official, and that such are not substantially adverse to the City, shall be
conclusively evidenced by the execution of such Interlocal Cooperative Agreement by such
official.
Section 2. Severability. If any section, paragraph or provision of this Ordinance shall be
held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such
section, paragraph or provision shall not affect any of the remaining provisions of this
Ordinance.
Section 3. Compliance With Open Meetings Laws. The City Commission hereby finds
and determines that all formal actions relative to the adoption of this Ordinance were taken in an
open meeting of this City Commission, and that all deliberations of this City Commission and of
its committees, if any, which resulted in formal action, were in meetings open to the public, in
full compliance with applicable legal requirements.
Section 4. Conflicts. All ordinances, resolutions, orders or parts thereof in conflict with
the provisions of this Ordinance are, to the extent of such conflict, hereby repealed and the
provisions of this Ordinance shall prevail and be given effect.
Section 5. Effective Date. This Ordinance shall be read on two separate days and will
become effective upon summary publication pursuant to KRS Chapter 424.
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Introduced by the Board of Commissioners, December 9, 2014
Adopted by the Board of Commissioners, December 16, 2014
Recorded by Tammara S. Sanderson, City Clerk, December 16, 2014
Published by The Paducah Sun, December 22, 2014
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EXHIBIT A
INTERLOCAL COOPERATIVE AGREEMENT
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INTERLOCAL COOPERATION AGREEMENT
THIS INTERLOCAL COOPERATION AGREEMENT (this "Agreement') made and
entered into as of this day of ; 2014, by and between the CITY OF
PADUCAH, KENTUCKY ("City") and the PADUCAH-McCRACKEN COUNTY
CONVENTION AND VISITORS BUREAU ("Bureau").
WITNESSETH
WHEREAS, Bureau have determined that it is necessary and desirable to assist the City
in the repayment of approximately $4,000,000.00 of the City's Taxable General Obligation
Bonds, Series of 2014D ("Bonds"), which bonds are to be issued by the City to finance (i) the
costs of constructing, installing and equipping of facilities and support structures, including
infrastructure and related appurtenances, connected with the construction and development of an
upscale hotel and (ii) a portion of the costs of the construction and development of an upscale
hotel (the "Project') on City owned property adjacent to the publically owned convention center,
generally known as the Julian Carroll and Paducah Expo Convention Center (the "Convention
Center"); and
WHEREAS, the parties hereto understand that the City's goal is the delivery of an
upscale and professionally designed hotel which advances the purposes of the Bureau; and
WHEREAS, pursuant to Sections 65.210 to 65.300, inclusive, of the Kentucky Revised
Statutes, as amended (the "Interlocal Cooperation Act"), the City and the Bureau may join
together to accomplish what each may accomplish individually; and
WHEREAS, the City and the Bureau now wish to establish their respective rights and
duties in connection with the financing of the Project and memorialize their arrangements for the
allocation of the Room Tax, as hereinafter defined, in order to provide for the orderly payment
and retirement of the Bonds, all in accordance with the Interlocal Cooperation Act;
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS
BETWEEN THE PARTIES, IT IS AGREED AS FOLLOWS:
"ACT" or "CONVENTION ACT" means KRS 91A.350 through 91A.394, as amended.
"BOND DEBT SERVICE" means the aggregate annual principal and interest
requirements of the Bonds.
"BONDS" means the aggregate principal amount of the City's Taxable General
Obligation Bonds, Series 2014D, which will be issued in an approximate amount of
$4,000,000.00, authorized pursuant to the provisions of KRS 66.011 et seq.
"BUREAU" means the Paducah -McCracken County Convention and Visitors Bureau, a
quasi -governmental entity formed jointly by the City of Paducah and McCracken County
pursuant to authority under KRS 91A.350 -91A.392, with the purpose of promoting and
developing convention and tourist activities and facilities.
BUREAU'S SHARE OF ROOM TAX" means 50% of the aggregate Room Tax
authorized under the Act and distributed by the McCracken County to the Bureau (or the 3% of
�- the authorized 6% Room Tax, which 3% is allocated to provide funds for the operation of the
Bureau).
"CITY" means the City of Paducah, Kentucky acting by and through its City
Commission.
"DEVELOPER" means the Paducah Convention Hotel, LLC, a Kentucky limited liability
company, David M. Puckett, Todd M. Clark, John M. Clark, David B. Jones, Glenn R. Malone,
Eddie Corley, and Garret Forbes Mathieu.
"DEVELOPMENT AGREEMENT" means the agreement between the Developer and
the City for the construction, development and management of an upscale hotel on City owned
property adjacent to the Convention Center.
"DUE DATE" means collectively the Interest Due Date and the Principal Due Date over
the Term of Bonds.
"INTEREST DUE DATE" means bi-annual dates which fall on the fifteenth (15th) day
preceding the date when interest installments become due, on the Bonds as reflected in the New
Debt Service Schedule.
"INTERLOCAL COOPERATION ACT" means KRS 65.210 through 65.300.
"KRS" means the Kentucky Revised Statutes, as amended.
"PLEDGED TAX" means a portion of the Bureau's Share of Room Tax equal to
$500,000.00 together with interest thereto, calculated at the interest rate established for the
Bonds following advertised, competitive sale, of the Bond Debt Service paid over the Term of
Bonds.
"PRINCIPAL DUE DATE" means annual dates which fall on the fifteenth (15th) day
preceding the date when principal installments become due on the Bonds as reflected in the New
Debt Service Schedule.
"PROJECT" means the (i) construction, installation and equipping of facilities and
support structures, including infrastructure and related appurtenances connected with the
construction and development of an upscale hotel and (ii) the construction and development of
an upscale hotel on City owned property adjacent to the Convention Center in Paducah,
Kentucky.
"ROOM TAX" or "TAX" means the special transient room tax authorized to be levied
by the County in accordance with KRS 91A.390 and 91A.392, in the aggregate authorized
amount of 6%.
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"TERM OF BONDS" means the period beginning with the dated date of the Bonds and
running until the last principal maturity of the Bonds is paid and retired, including all interest
thereon.
GENERAL FINANCING PLAN
It is the intention of the parties to this Agreement to set forth their respective rights and
duties in connection with financing certain portions of the Project.
A portion of the financing will be provided by the City and Bureau to the Developer and
shall be supplied from the proceeds of the City's Bonds which shall supplement other monies
available to the Developer from other sources.
The City shall issue its Bonds in the aggregate amount of approximately $4,000,000.00
which shall be disbursed in accordance with the Development Agreement and other definitive
agreements to be entered into by and between the City and the Developer.
The Bonds shall be secured by the full faith, credit and taxing power of the City;
provided; however, $500,000.00 of these Bonds shall be used exclusively for construction,
installation and equipping of facilities and support structures, including infrastructure and related
appurtenances necessary for the construction and development of an upscale hotel (the "Non -
Hotel Improvements).
Pursuant to this Interlocal Cooperation Agreement, the Bureau hereby consents and
agrees to assist the City in repayment of the portion of the Bonds used for the Non -Hotel
Improvements by pledging the Pledged Tax. The Bureau will recoup their contribution through
increased Room Tax revenues generated once the Project is complete.
RIGHTS AND DUTIES OF THE CITY
The City shall issue its Bonds and shall disburse the proceeds of the Bonds in accordance
with the Development Agreement and other definitive agreements to be entered into by and
between the City and the Developer. Upon receipt of the Bureau's Pledged Tax, the City shall
apply such payments to the Bond Debt Service.
RIGHTS AND DUTIES OF THE BUREAU
The Bureau hereby consents and agrees to the issuance of Bonds by the City for the
Project.
The Bureau hereby pledges the Pledged Tax exclusively to the City to repay $500,000.00
together with interest thereto, calculated at the interest rate established for the Bonds following
advertised, competitive sale, of the Bond Debt Service. The Pledged Tax shall be paid to the
City in bi-annual interest only installments on the Interest Due Date and annual principal
installments on the Principal Due Date over the Term of Bonds, which installments shall be paid
in accordance with the Net Debt Service Schedule to be provide by the Director of Finance for
the City of Paducah, which shall be appended to and made a part of this executed Agreement as
Exhibit A by the aforesaid Director of Finance, upon the issuance of the Bonds, provided,
however, the first installments of bi-annual interest and annual principal shall not commence
until the expiration of the eighteenth (18th) month following the dated date of the Bonds. This
delay in the commencement of the Bureau's interest and principal installments is designed to
allow the Bureau sufficient time to receive an increase in the Bureau's Share of Room Tax, if
any, resulting from the operation of the Project. Bureau shall promptly pay the Pledged Tax
when due to the Director of Finance for the City of Paducah, at Post Office Box 2267, Paducah,
Kentucky 42002-2267, or at such other location as may be designated by the City in writing.
In the event the Pledged Tax is more than the Bureau's Share of the Room Tax on any
Due Date, this shortage shall be bore by the Bureau.
PLEDGE OF ROOM TAX
The City and the Bureau each covenant and agree that the Pledged Tax is hereby assigned
to the City and pledged solely to the payment of the Bond Debt Service, which is $500,000.00
together with interest thereto, calculated at the interest rate established for the Bonds following
advertised, competitive sale. Said assignment of the Pledged Tax shall remain in effect without
alteration for Term of Bonds.
AGREEMENT AS CONTRACT; OWNERS OF BONDS AS THIRD PARTY
BENEFICIARIES
This Agreement is made for the benefit and security of all those who may become the
registered owners of the City's Bonds (the "Bondholders"), and no change, alteration or
amendment shall be made to the terms hereof so long as said Bonds remain outstanding.
MISCELLANEOUS
This Agreement shall be binding upon the parties hereto and upon their respective
permitted successors and transferees.
Nothing expressed or implied herein is intended or shall be construed to confer upon any
person, firm or corporation other than the parties hereto and the Bondholders, any right, remedy
or claim by reason of this Agreement or any term hereof, and all terms contained herein shall be
for the sole and exclusive benefit of the parties hereto, and their successors and permitted
transferees and said Bondholders.
This Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Kentucky.
If one or more provisions of this Agreement, or the applicability of any such provisions
for any set of circumstances shall be determined to be invalid or ineffective for any reason, such
determination shall not affect the validity and enforceability of the remaining provisions of this
Agreement or the applicability of the provisions found to be invalid or ineffective for a specific
set of circumstances to other circumstances.
This Agreement may be amended or any of its terms modified only by a written
document authorized, executed and delivered by each of the parties hereto.
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This Agreement may be executed in one or more counterparts and when each party hereto
has executed at least one counterpart, this Agreement shall become binding on all parties and
such counterparts shall be deemed to be one and the same document.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized representatives as of the date first above written.
CITY OF PADUCAH, KENTUCKY, Authorized
by Action of the City Commission of the City on
Mayor
Attest:
City Clerk
STATE OF KENTUCKY )
COUNTY OF McCRACKEN )
2014
The foregoing instrument was subscribed, sworn to, and acknowledged before me on this
day of , 2014 by, Gayle Kaler, Mayor of the City of Paducah, Kentucky.
My commission expires
NOTARY PUBLIC, STATE AT LARGE
5
PADUCAH-McCRACIKEN COUNTY
CONVENTION AND VISITORS BUREAU,
on 2014
Ghatrpersori
STATE OF KENTUCKY
COUNTY OF McCRACKEN
The foregoing instrument was subscribed, sworn to, and acknowledged before me on this
day. Of 2014 by�t . kw_�J.Ar,",
6 e'Paducah-McCrackin ounfyVrsft6rs Bureau
My commission expires__ Ida,;
6
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This Interlocal Cooperation Agreement is in proper form, and is compatible with the
Laws of the Commonwealth of Kentucky; therefore, it is approved this _ day of
, 2014.
By:
Attorney General
The fgregoin" ume `t was prepared by:
D ;TtT'ON & K>JOL16% LLP
P. O. Box 929
Paducah, KY 42002-0929
7
EXHIBIT A
Net Debt Service Schedule
To be provided by the Director of Finance for the city of Paducah upon the issuance
of the Bonds.
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