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HomeMy WebLinkAbout2020-12-8664229233 ORDINANCE NO. 2020-12-8664 AN ORDINANCE OF THE CITY OF PADUCAH, KENTUCKY, APPROVING AND AUTHORIZING THE EXECUTION OF AN INTERLOCAL COOPERATIVE AGREEMENT AMONG THE CITY OF PADUCAH, KENTUCKY, THE COUNTY OF MCCRACKEN, KENTUCKY, THE PADUCAH-MCCRACKEN COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY, AND GREATER PADUCAH ECONOMIC DEVELOPMENT COUNCIL AND AUTHORIZING THE EXECUTION OF A FORGIVENESS OF DEBT AGREEMENT BETWEEN THE CITY OF PADUCAH, KENTUCKY, AND GREATER PADUCAH ECONOMIC DEVELOPMENT COUNCIL PURSUANT TO THE TERMS OF SAID INTERLOCAL AGREEMENT. WHEREAS, the City of Paducah (the "City"), McCracken County, (the "County"), the Paducah -McCracken County Industrial Development Authority (the "IDA") and Greater Paducah Economic Development Council ("GPED"), together the "Parties," desire to effect the repositioning of the IDA and its role with regard to property ownership, maintenance, development, marketing, and management within the City and the County; and WHEREAS, pursuant to Sections 65.210 to 65.300, inclusive, of the Kentucky Revised Statutes, as amended (the "Interlocal Act"), the Parties may join together to achieve this objective and their agreement as to same has been memorialized into an Interlocal Cooperative Agreement; and WHEREAS, pursuant to the proposed Interlocal Cooperative Agreement, the IDA shall become the owner of certain publicly owned development sites within Paducah and McCracken County, including the "Ohio River Triple Rail Megasite" (formerly known as "Riverport West"), which is currently owned by GPED; and WHEREAS, the City previously provided certain financial assistance to GPED for the acquisition, development and construction of said real estate (the "Project"); and WHEREAS, said financial assistance included the extension of a loan in the amount of $600,000.00 for completion of Phase II of the Project, which loan and repayment terms were evidenced by a Financing Agreement and a promissory note dated September 18, 2007 and secured by a mortgage of record with the McCracken County Clerk's Office in Mortgage Book 1147, page 569; and WHEREAS, said financial assistance also included the extension of a loan in the principal amount of $311,375.00 for completion of the Final Phase of the Project, which loan and repayment terms were evidenced by a Financing Agreement and a promissory note dated December 19, 2008 and secured by a mortgage of record with the McCracken County Clerk's Office in Mortgage Book 1201, page 293; and WHEREAS, in order to effect the repositioning of the IDA and to carry out the terms of the Interlocal Cooperative Agreement, the City desires to forgive the repayment by GPED of both the Phase II Note and the Final Phase Note, in a combined amount of $911,375.00; NOW THEREFORE be it ordained by the City Commission of the City of Paducah as follows: Section 1. Authorization of Interlocal Cooperative Agreement. The City of Paducah, Kentucky, hereby approves the Interlocal Cooperative Agreement between the City, the County, the IDA, and GPED 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. Forgiveness of Debt. The City hereby forgives the repayment of the indebtedness under both the Phase II Note dated September 18, 2007 and the Final Phase Note dated December 19, 2008 and the Notes and all indebtedness and obligations due thereunder are hereby fully released, discharged, extinguished, and cancelled. Further, the City hereby approves the Debt Forgiveness Agreement by and between the City and GPED in substantially the form attached hereto as Exhibit B and made part hereof. It is further determined that it is necessary and desirable and in the best interests of the City to enter into said Debt Forgiveness Agreement for the purposes therein specified, and the Mayor of the City is hereby authorized to execute the Debt Forgiveness Agreement, together with such other documents, instruments or certifications which may be necessary to accomplish the transaction contemplated by this Ordinance with such changes 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 Debt Forgiveness Agreement by such official. Section 3. 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 4. 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 5. 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 6. Effective Date. This Ordinance shall be read on two separate days and will become effective upon summary publication pursuant to KRS Chapter 424. 1 4MAYOR ATTEST: (:� J2� C-".., City Clerk Introduced by the Board of Commissioners, December 8, 2020 Adopted by the Board of Commissioners, December 15, 2020 Recorded by City Clerk, December 15, 2020 Published by The Paducah Sun, [)P-cm,bgr 18 , 2020 ORD\GPED IDA Interlocal & Debt Forgiveness — Triple Rail Mega site Ordinance prepared by Holly Homra — Denton Law EXHIBIT A INTERLOCAL COOPERATION AGREEMENT THIS INTERLOCAL COOPERATION AGREEMENT (the "Agreement') is made and entered into as of , 2020 by and between the CITY OF PADUCAH, KENTUCKY (the "City"), the COUNTY OF McCRACKEN, KENTUCKY (the "County"), the PADUCAH/MCCRACKEN COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY ("IDA"), and GREATER PADUCAH ECONOMIC DEVELOPMENT COUNCIL ("GPED"). WITNESSETH WHEREAS, the City and the County are parties to that certain Interlocal Cooperation Agreement dated March 6t', 1997 (attached hereto as Exhibit 1) pursuant to which the Paducah/McCracken County Industrial Development Authority was created; WHEREAS, the City, the County, the IDA, and GPED desire to enter into this Agreement for the purpose of repositioning the Paducah/McCracken County Industrial Development Authority and its role with regard to property ownership, maintenance, development, marketing, and management; and WHEREAS, after such repositioning, the IDA shall hold certain publicly owned development sites within Paducah and McCracken County and shall be responsible for management, maintenance, and development of such properties; and WHEREAS, GPED is the economic development organization of Paducah and McCracken County whose mission is to proactively recruit, obtain, and maintain companies providing high quality, high paying jobs with benefits for our region, and after the repositioning of the IDA as contemplated herein, shall be responsible for the management of the IDA and marketing of properties owned by the IDA; and WHEREAS, the parties recognize that, in order to maximize the region's economic development potential, GPED must serve as the active, outward facing economic development entity for Paducah / McCracken County providing oversight and guidance to the IDA; and WHEREAS, the parties recognize that to best position our community for sustainable economic growth, the IDA must serve as an aid in capturing incentives and holding, obtaining, and developing favorable economic development properties; and WHEREAS, the parties have determined that the repositioning of the IDA as outlined in this Agreement is in the public interest and the parties now wish to establish their respective rights and duties related thereto; NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS BETWEEN THE PARTIES, IT IS AGREED AS FOLLOWS: 1. GENERAL FINANCING PLAN 1.1 Pursuant to KRS 96.895, the County is the recipient of annual payments under the Regional Development Agency Assistance Program in the current amount of approximately $154,000.00 per year ("RDAAP Funds"). The County hereby consents and agrees that it shall designate the Paducah/McCracken County Industrial Development Authority as the recipient of all RDAAP Funds. Additionally, upon signing this Agreement, the County shall allocate all RDAAP Funds currently held by the County to the IDA. The City of Paducah hereby consents and agrees that it shall match the annual RDAAP Funds received by the IDA in the minimum amount of $150,000.00 and up to a maximum amount of $250,000.00 for a period of ten (10) years, with the first of such payments being made no later than March 31, 2021. 1.2 The City and County are parties to the Interlocal Cooperation Agreement dated March 6t', 1997 for the creation of the Paducah/McCracken Industrial Park under which the City and the County share payroll taxes from qualifying projects (See Exhibit 1). Except as otherwise stated herein, this agreement shall remain in full force and effect until its expiration. 1.3 The City and the County are parties to a Memorandum of Understanding dated June 15, 2004, pursuant to which the City and the County agreed to provide economic incentives to AAA Fabricators for the acquisition, installation, and equipment of a manufacturing facility and to share payroll taxes generated from said project.. A copy of this agreement is attached hereto as Exhibit 2. Except as otherwise stated herein, this agreement shall remain in full force and effect until its expiration. 1.4 The City and the County are parties to the Economic Development Revenue Sharing Agreement dated February 13th, 2006 ("Revenue Sharing Agreement"), a copy of which is attached hereto as Exhibit 3. Pursuant to such Revenue Sharing Agreement, the City and County have agreed to split equally the payroll taxes generated from Qualified Projects as 4 defined therein. Except as otherwise stated herein, this agreement shall remain in full force and effect until its expiration. 1.5 For each new development project locating in an IDA -held property which is not subject to a revenue sharing agreement as identified above, whether involving the sale or lease of the property, either the City or the County (as applicable based upon the location of the property) will designate a total of ten percent (10%) of the payroll taxes generated from such project to the IDA for a period of ten (10) years. In the event that the property is sold or leased to a new tenant during the term, such payroll tax designation shall continue until the expiration of the original ten year term. 1.6 The Parties agree that they shall cooperate as necessary in pursuing and applying for grants and other funding opportunities to support the IDA. 1.7 The IDA shall prepare and submit an annual budget to the City and the County. 2. TRANSFER OF REAL PROPERTY The City, the County, and GPED each own development sites located within Paducah and McCracken County, as more particularly described in Exhibit 4 hereto. The Parties agree that all development sites listed on Exhibit 4 shall be transferred to the IDA in accordance with the schedule set out in Section 7 below. It is the intent of the parties that, upon completion of the above-described transfers, the IDA shall be the owner of certain publicly -held development sites within Paducah and McCracken County and GPED will be the organization responsible for the management and marketing of said IDA -owned properties. 3. DEBT FORGIVENESS 3.1 The City has made loans to GPED with a current outstanding balance of $911,375.00 for the purchase of the Triple Rail Site. The City agrees that, upon transfer of the property to the IDA in accordance with Section 2 above, it will forgive the full amount of this loan. A separate debt forgiveness agreement may be entered into between the City and GPED to carry out this objective and a copy of such agreement shall be attached as Exhibit 5. 3.2 The County has made loans to GPED with a current outstanding balance of $411,375.00 for the purchase of the Triple Rail Site. The County agrees that, upon transfer of the property to the IDA in accordance with Section 2 above, it will forgive the full amount of this loan. A separate debt forgiveness agreement may be entered into between the County and GPED to carry out this objective and a copy of such agreement shall be attached as an exhibit hereto as Exhibit 6. 4. DUTIES OF THE PADUCAH/MCCRACKEN COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY 4.1 The IDA shall serve as the owner of certain publicly -held development sites until such sites are sold for development. The IDA will also purchase additional property in collaboration with the City, County, and GPED for further development opportunities. 4.2 The IDA shall be responsible for maintenance and repair of all property under its ownership, including all medians and right of ways, which shall include landscaping, mowing, signage, lighting, and installation of other fixtures, as well as other maintenance duties as necessary and appropriate to maintain the safety, appearance, and marketability of the property. 4.3 In addition to general maintenance and repair, the IDA shall actively take steps to mitigate any environmental, utility, or other barriers to development of the sites. Additionally, upon the advice and recommendation of the City, the County, or GPED, the IDA may make such improvements to the sites as necessary to attract business prospects to the sites including, but not limited to, site preparation, infrastructure build up, and construction of speculative buildings. 4.5 The IDA may utilize its undeveloped properties for revenue -generating activities (such as rental of the property for crop land), so long as such activities do not compromise or limit the property's development potential. All revenue generated from such activities shall remain the property of the IDA and shall be used for property maintenance, upkeep, development, and purchase, or other approved activities as designated. 4.6 Within each industrial park, whether now owned by the IDA or later acquired, the IDA shall establish an advisory committee of up to four (4) members which allows businesses located within the park to communicate their needs and resources and to promote collaboration amongst themselves and the IDA. 4.7 Working in collaboration with GPED, the IDA will serve as a vehicle for potential initiatives to aid in facilitating economic development within the region including, but not limited to tax favorable purchases of land and equipment. 5. IDA BOARD OF DIRECTORS RESTRUCTURE. 5.1 The Parties agree that all current members of the IDA board of directors shall resign from their positions for the purpose of carrying out the repositioning contemplated hereunder. The IDA shall amend and restate its bylaws to provide for a total of seven (7) directors, who shall all be voting members. One (1) of the Director positions shall be occupied by the Mayor of the City of Paducah, and one (1) of the Director positions shall be occupied by the McCracken County Judge Executive for so long as they are serving in their elected positions. The Mayor of the City of Paducah shall appoint one (1) Director position from the GPED Board of Directors. The McCracken County Judge Executive shall also appoint one (1) Director position from the GPED Board of Directors. Of the remaining three (3) Director positions, one (1) shall be appointed by the Mayor, one (1) shall be appointed by the Judge Executive, and the remaining one (1) shall be appointed jointly by the Mayor and Judge Executive. 5.2 With the exception of the Director positions held by the Mayor and Judge Executive, who shall maintain their board positions for so long as they are serving in their elected positions, the Directors shall serve for terms of four (4) years. The terms of the initial appointed board members shall be staggered for continuity, with two Directors appointed for four (4) years, two Directors appointed for three (3) years, and one director appointed for two (2) years. No elected Director shall serve for more than two (2) consecutive terms. A person may be considered to rejoin the board as a Director after being off the Board for a period of one (1) year. 5.3 The Mayor or the Judge Executive shall serve as Chair and Vice Chair of the Board, alternating the positions every two (2) years. Such other officers as may be deemed necessary may be elected or appointed by the Board of Directors. 6. DUTIES OF GPED 6.1 GPED shall serve as the manager of the IDA and shall be responsible for managing and ensuring completion of the duties and responsibilities as set forth in Section 4 above. 6.2 GPED shall maintain a list of IDA -owned properties and market said properties promoting economic development. 6.3 GPED shall work to identify obstacles and barriers to the development, maintenance, and disposition of IDA -owned properties and advise the IDA on their improvement or removal. 6.4 GPED shall negotiate and manage incentive packages promoting IDA -owned properties for economic development projects. 6.5 GPED shall coordinate the establishment of a committee within each industrial park allowing businesses located therein to communicate their needs and resources and to promote collaboration amongst themselves and the IDA. 6.6 GPED shall perform or assist with such other services as may, from time to time, be necessary. A separate Management Agreement shall be entered into between the IDA and GPED to govern the management arrangement contemplated herein. 7. REPOSITIONING PLAN 7.1 Phase 1. Phase One of the repositioning plan shall extend through December 31, 2020. During such phase, the parties shall strive to execute the loan forgiveness agreements as stated in Sections 3.1 and 3.2, , amend and restate the bylaws of the IDA as contemplated by Section 5 hereof, and affect the Management Agreement between GPED and the IDA as contemplated by Section 6 hereof. 7.2 Phase 2. Phase Two of the repositioning plan shall extend through March 31, 2021. During such phase, the GPED and the County shall affect the transfer of the properties as identified on Exhibit 4 and assign all outstanding leases to the IDA. 7.3 Phase 3. Phase Three shall be the final phase of the repositioning plan and shall extend through June 30, 2021. During Phase Three, the parties shall assign all outstanding broker option agreements from GPED to the IDA, transfer any relevant fixed assets to the IDA, and complete any other outstanding items related to the repositioning plan. 8. DURATION AND TERMINATION; AMENDMENTS This Agreement shall become operational and have force and effect upon its execution and approval by the Attorney General pursuant to KRS 65.260, and the filing of this Agreement with the Clerk of the County of McCracken, Kentucky, all pursuant to the Interlocal Act. This Agreement shall remain in full force and effect for a term of ten (10) years, unless earlier terminated by joint action of the City and the County. Termination of this Agreement shall not affect the legal status or standing of the IDA or GPED, who shall retain their own assets and property. 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. 9. NON -LIABILITY OF OFFICERS AND EMPLOYEES No officer or employee of any Party hereto shall be subject to any personal liability for any debt or contract created by this Agreement or as a result thereof. 10. NATURE OF AGREEMENT The City, County, IDA, and GPED agree to engage in a joint and cooperative undertaking only within the scope set out in this Agreement and do not intend to create among them any relationship of surety, indemnification or responsibilities for debts, claims, or liabilities incurred by any party in their operations, other than as specifically set out herein. Furthermore, the execution of this Agreement shall not constitute a waiver of any defense or immunity that a Party would otherwise be entitled to under any applicable law. 11. FURTHER ASSURANCES. The Parties agree that they shall, at any time upon the request of another party, make, execute, and deliver or cause to be made, executed, and delivered to the requesting party any and all other further instruments, certificates, and other documents as may, in the reasonable opinion of requesting party, be necessary or desirable in order to effect, complete, perfect, or otherwise to fulfill the obligations of the parties under this Agreement. 12. 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 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, their successors and permitted transferees. 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. The waiver by any Party of a breach, default or violation of this Agreement shall not operate as or be constructed to be a waiver of any subsequent breach hereof. 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. 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 on December 15, 2020 Mayor Attest: City Clerk COUNTY OF MCCRACKEN, KENTUCKY, Authorized by Action of the Fiscal Court of the County on December 15, 2020. Judge Executive Attest: Fiscal Court Clerk GREATER PADUCAH ECONOMIC DEVELOPMENT Board Chair PADUCAH/MCCRACKEN INDUSTRIAL DEVELOPMENT AUTHORITY Board Chair EXHIBITS Exhibit 1 — Interlocal Cooperation Agreement dated March 6th, 1997 Exhibit 2 — Memorandum of Understanding dated June 15, 2004 Exhibit 3 — Interlocal Economic Development Revenue Sharing Agreement dated February 13th, 2006 Exhibit 4 — Property Schedule Exhibit 5 — Debt Forgiveness Agreement b/t City of Paducah and GPED Exhibit 6 — Debt Forgiveness Agreement b/t McCracken County and GPED APPROVAL Office of the Attorney General 700 Capitol Avenue, Suite 118 Frankfort, Kentucky 40601-3449 (502) 696-5300 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 2020. OFFICE OF KENTUCKY ATTORNEY GENERAL, DANIEL CAMERON am Title: Date: EXHIBIT B DEBT FORGIVENESS AGREEMENT THIS FORGIVENESS OF DEBT AGREEMENT is made and entered into on this day of December, 2020, by and between CITY OF PADUCAH, KENTUCKY, a city of the home rule class of the Commonwealth of Kentucky, (the "City") and GREATER PADUCAH ECONOMIC DEVELOPMENT COUNCIL ("Borrower") a Kentucky non-profit corporation organized and existing pursuant to the laws of the Commonwealth of Kentucky. RECITALS WHEREAS, the City previously provided certain financial assistance to the Borrower for the acquisition, development and construction of certain real estate located in Paducah, McCracken County, Kentucky and known as the Ohio River Triple Rail Megasite (formerly "Riverport West") real estate (the "Project"); and WHEREAS, said financial assistance included the extension of a loan in the amount of $600,000.00 for completion of Phase II of the Project, which loan and repayment terms were evidenced by a Financing Agreement and a promissory note dated September 18, 2007 and secured by a mortgage of record with the McCracken County Clerk's Office in Mortgage Book 1147, page 569; and WHEREAS, said financial assistance also included the extension of a loan in the principal amount of $311,375.00 for completion of the Final Phase of the Project, which loan and repayment terms were evidenced by a Financing Agreement and a promissory note dated December 19, 2008 and secured by a mortgage of record with the McCracken County Clerk's Office in Mortgage Book 1201, page 293; and WHEREAS, the City desires to forgive the repayment by the Borrower of both the Phase II Note and the Final Phase Note (collectively referred to as the "Note") in a combined amount of $911,375.00; WHEREAS, it is mutually desirable, beneficial, agreeable and in the best interest of the parties hereto and the City residents that the City forgive the repayment of the Note as such forgiveness furthers the public purposes of the City. NOW, THEREFORE, for and in consideration of the foregoing premises, and for other valuable consideration, the legal adequacy, sufficiency, and receipt of which is hereby acknowledged by all parties hereto, the parties do covenant and agree as follows: 1. Forgiveness. Effective as of December 31, 2020, the City hereby forgives the repayment of the Note; and the Note and all indebtedness and obligations due thereunder are hereby fully released, discharged, extinguished, and cancelled; and Borrower is frilly released and discharged from any liability with respect to the Note and all indebtedness and obligations due thereunder. 2. Miscellaneous Provisions. This Agreement shall be binding upon the parties hereto, their successors, and assigns. In the event of any litigation concerning this Agreement, Borrower submits itself to the jurisdiction of the McCracken Circuit Court, and additionally, hereby waives its right of trial by jury. IN TESTIMONY WHEREOF, this Forgiveness of Debt Agreement has been executed by the parties on the day and year first above written. [SIGNATURE LINES ON FOLLOWING PAGE] :CIT7ADUCN,KENTUCKY Mayor Brandi rless COMMONWEALTH OF KENTUCKY ) :ss. COUNTY OF McCRACKEN ) Subscribed, sworn to and acknowledged before me by CITY OF PADUCAH, KENTUCKY, by and through its duly authorized representative, on this the day of , 2020. My commission expires: Notary ID # NOTARY PUBLIC STATE AT LARGE GREATER PADUCAH ECONOMIC DEVELOPMENT Lo Title COMMONWEALTH OF KENTUCKY ) :ss. COUNTY OF McCRACKEN ) Subscribed, sworn to and acknowledged before me by GREATER PADUCAH ECONOMIC DEVELOPMENT, by and through its duly authorized representative, , on this the day of .2020. NOTARY PUBLIC STATE AT LARGE My commission expires: Notary ID #