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HomeMy WebLinkAbout2010-11-09 - RESOLUTIONS - BONDS AEROSPACE DYNAMICS (4)RESOLUTION NO. 10-88 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA, CALIFORNIA, RESCINDING RESOLUTION 10-48 AND APPROVING THE ISSUANCE OF REVENUE BONDS BY THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $13,270,000 FOR THE PURPOSE OF FINANCING THE ACQUISITION, DESIGN, CONSTRUCTION AND INSTALLATION OF CERTAIN RECOVERY ZONE PROPERTY FOR THE BENEFIT OF MARVIN ENGINEERING CO., INC. AND/OR ITS AFFILIATE, AEROSPACE DYNAMICS INTERNATIONAL, INC., AND ALLOCATING A LIKE AMOUNT OF RECOVERY ZONE FACILITY BOND VOLUME CAP FOR SUCH PURPOSE WHEREAS, the American Recovery and Reinvestment Act of 2009 (Pub. L. No. 111-5) authorizes a new category of federally tax-exempt private activity bonds entitled "recovery zone facility bonds" that have been codified in Sections 140OU-1 and 140OU-3 (collectively, the "Recovery Zone Facility Act") of the Internal Revenue Code of 1986, as amended (the "Code"); and WHEREAS, the Recovery Zone Facility Act permits the issuance of recovery zone facility bonds to finance certain improvements in an area designated as a "recovery zone" by the ' issuer of such bonds or the locality in which such improvements are located; and WHEREAS, by resolution adopted on October 27, 2009, the City Council (the "City Council') of the City of Santa Clarita (the "City") designated certain portions of the geographic territory of the City as a "recovery zone" for purposes of the Recovery Zone Facility Act (the "Recovery Zone Designation"); and WHEREAS, pursuant to Chapter 5 of Division 7 of Title I of the Government Code of the State of California (the "JPA Act"), certain public agencies (the "Members") have entered into a Joint Exercise of Powers Agreement (as amended and restated as of June 1, 1988, the "Agreement") in order to form the California Statewide Communities Development Authority (the "Authority"), for the purpose of promoting economic, cultural and community development, and in order to exercise any powers common to the Members, including the issuance of bonds, notes or other evidences of indebtedness; and WHEREAS, the City is a Member of the Authority; and WHEREAS, the Authority is authorized pursuant to the JPA Act and the Agreement to issue and sell revenue bonds, including recovery zone facility bonds, for the purpose, among others, of financing recovery zone property for private companies, and is an eligible issuer of recovery zone facility bonds pursuant to the Recovery Zone Facility Act; and ' WHEREAS, Aerospace Dynamics International, Inc., a California corporation ("ADI"), has requested that the Authority issue and sell recovery zone facility bonds in the maximum principal amount of $13,270,000 (the "Bonds") for the purpose of making one or more loans to ADI and/or its parent corporation, Marvin Engineering Co., Inc., a California corporation ' ("MEC" and together with ADI and the other affiliates thereof, the "Borrowers") to (1) finance a portion of the cost of (a) designing, acquiring, constructing and equipping an approximately 110,000 square foot facility to be used in the design and production of aircraft parts, components and assemblies, located in the City at 25575 Rye Canyon Road (Assessor's Parcel No. 2866-006-057), and (b) acquiring and installing certain related equipment and capital items to be installed and located in the City at 25540 Rye Canyon Road and 25571 Rye Canyon Road (collectively, the "Project"); and (2) pay certain expenses incurred in connection with the issuance of the Bonds; and WHEREAS, the Project is to be owned and/or operated by ADI and/or MEC; and WHEREAS, pursuant to the Recovery Zone Facility Act, eligible issuers may issue recovery zone facility bonds only upon the grant of a volume cap allocation to an eligible issuer or to the ultimate beneficiaries of the recovery zone facility bonds; and WHEREAS, pursuant to the Section 1400U-1(a)(3)(A) of the Recovery Zone Facility Act and Internal Revenue Service Notice 2009-50, the City has received recovery zone facility bond volume cap in the aggregate amount of $13,270,000, and may reallocate such volume cap to an eligible issuer or the ultimate beneficiaries in any reasonable manner it determines in good faith in its discretion; and WHEREAS, a resolution of the City Council is a reasonable and appropriate manner to I reallocate such volume cap to an eligible issuer or the ultimate beneficiaries; and WHEREAS, in order for the interest on the Bonds to be tax-exempt, Section 147(f) of the Code requires that an "applicable elected representative" of the governmental unit, the geographic jurisdiction of which contains the site of facilities to be financed with the proceeds of the Bonds, hold a public hearing on the issuance of the Bonds and approve the issuance of the Bonds following such hearing; and WHEREAS, the Authority has determined that the City Council is an "applicable elected representative" for purposes of holding such hearing and approving such issuance; and WHEREAS, as a condition to issuing bonds to assist in the financing of capital projects, Section 9 of the Agreement requires the approval of the Member within the jurisdiction of which the project is situated; and WHEREAS, the Authority has requested that the City Council approve the issuance of the Bonds by the Authority in order to satisfy the public approval requirement of Section 147(f) of the Code and the requirements of Section 9 of the Agreement; and WHEREAS, notice of such public hearing has been duly given as required by the Code, and this City Council has heretofore held such public hearing at which all interested persons were ' `� given an opportunity to be heard on all matters relative to the financing of the Project and the ' Authority's issuance of the Bonds therefor; and WHEREAS, it is in the public interest and for the public benefit that the City Council approve the issuance of the Bonds by the Authority for the aforesaid purposes; and WHEREAS, on June 22, 2010, the City Council adopted its Resolution No. 10-48 (the "Prior Resolution") approving and authorizing the same matters authorized and approved by this resolution; and WHEREAS, the Prior Resolution did not make reference to one of the street addresses for the Project and one of the owners or operators of the Project, and the City has been advised by counsel to correct such omissions and to reapprove and reauthorize such matters in this resolution; and WHEREAS, the Borrowers have also requested the Authority to issue an additional $7,000,000 principal amount of recovery zone facility bonds (the "Additional Bonds") to finance additional recovery zone property at one or more of the aforesaid locations, and to apply to the State of California for additional recovery zone facility bond volume cap to support such bond issuance, and such Additional Bonds (if issued) and such state volume cap allocation (if received) will be separate and distinct from, and in addition to, the Bonds approved and the volume cap granted hereunder. ' NOW, THEREFORE, the City Council of the City of Santa Clarita does hereby resolve as follows: SECTION 1. The City Council hereby finds and determines that the foregoing recitals are true and correct. The Prior Resolution is hereby rescinded and is superseded by this resolution. SECTION 2. The City Council hereby approves the issuance of the Bonds by the Authority. It is the purpose and intent of the City Council that this resolution constitute approval of the issuance of the Bonds (a) by the "applicable elected representative" of the governmental unit having jurisdiction over the area in which the Project is or is to be located in accordance with Section 147(1) of the Code and (b) by the City Council in accordance with Section 9 of the Agreement. SECTION 3. The issuance of the Bonds shall be subject to the approval of the Authority of all financing documents relating thereto to which the Authority is a party. The City shall have no responsibility or liability whatsoever with respect to the Bonds. SECTION 4. The City Council hereby grants recovery zone facility bond volume cap in the aggregate amount of $13,270,000 to the Borrowers, provided that said volume cap is to be used for the issuance of recovery zone facility bonds by the Authority to finance a portion of the ' costs of the Project. 3 SECTION 5. The adoption of this Resolution shall not obligate the City to (i) provide any financing to acquire or construct the Project or any refinancing of the Project; (ii) approve ' any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, design, construction, installation or operation of the Project; (iii) make any contribution or advance any funds whatsoever to the Authority; or (iv) take any further action with respect to the Authority or its membership therein. SECTION 6. The executing officers, the City Clerk and all other proper officers and officials of the City are hereby authorized and directed to execute such other agreements, documents and certificates, and to perform such other acts and deeds, as may be necessary or convenient to effect the purposes of this Resolution and the transactions herein authorized. SECTION 7. This resolution shall take effect immediately upon its passage. SECTION 8. The City Clerk shall certify to the adoption of this Resolution. PASSED, APPROVED AND ADOPTEI ATTEST: -15 w,V CITY CLERK DATE: k d d 10 rd STATE OF CALIFORNIA ) ' COUNTY OF LOS ANGELES ) ss. CITY OF SANTA CLARITA ) I, Sarah P. Gorman, City Clerk of the City of Santa Clarita, do hereby certify that the foregoing Resolution was duly adopted by the City Council of the City of Santa Clarita at a regular meeting thereof, held on the 9th day of November, 2010, by the following vote: AYES: COUNCILMEMBERS: Kellar, McLean, Ferry, Ender, Weste NOES: COUNCILMEMBERS: None ABSENT: COUNCILMEMBERS: None 5 CITY CLERK STATE OF CALIFORNIA COUNTY OF LOS ANGELES CITY OF SANTA CLARITA ) ss. } CERTIFICATION OF CITY COUNCIL RESOLUTION I, , City Clerk of the City of Santa Clarita, do hereby certify that this is a true and correct copy of the original Resolution No. 10-88, adopted by the City Council of the City of Santa Clarita, California on November 9, 2010, which is now on file in my office. Witness my hand and seal of the City of Santa Clarita, California, this _ day of 2010. City Clerk By Deputy City Clerk F1