HomeMy WebLinkAboutCOUNCIL MINUTES 1986-05-28 SPECIAL 22524
MINUTES OF THE ONE HUNDRED AND N%NETY- FDFTHSPECDAL MEETING
lbw OF THE COUNCIL OF THE CITY OF LIVONIA
Pursuant to the provisions of Section 8, Chapter 14 of the City Charter,
the above meeting was held May 28, 1986 at the City Hall , 33000 Civic Center Drive,
Livonia, Michigan, and was called to order by the President of the Council at
approximately 7 40 P M Roll was called with the following result Present. Robert
R Bishop, Joan McCotter, Fernon P Feenstra, Robert E. McCann, Gerald Taylor, Robert
D Bennett and Ron Ochala Absent None
Elected and appointed officials present Robert F Nash, City Clerk,
Harry Tatigian, City Attorney, Jack Dodge, Director of Finance and Michael Deller,
City Librarian.
On a motion by Councilman Bennett, seconded by Councilman Feenstra, and
�mw
unanimously adopted, it was
#518-86 WHEREAS, the City is authorized by Section 3b of Chapter
IV of Act 202 of the Public Acts of Michigan, as amended, MCL 131 1
etseq. ("Act 202"), to borrow money and issue its notes ("Notes")
in anticipation of the collection of all or part of the real and
personal property taxes to be levied on July 1 , 1986 (the "Levy Date"),
on property located within the corporate boundaries of the City by
the City and by any or all of the other units of government for which
the City is the local property tax collecting unit pursuant to Act
206 of the Public Acts of Michigan of 1893, as amended, MCL 211 ,1
et seq ("Act 206w), and
WHEREAS, the City proposes to borrow money and issue its
Notes in anticipation of the collection of all or part of the property
taxes to be levied on the Levy Date and collected by the City in the
Livonia Public Schools, Clarenceville School District, the Schoolcraft
Community College District and the Oakland Intermediate School District
(the "Tax Levy" and collectively the "Units" , respectively) , and
WHEREAS, the City is further authorized by Act 202 to
distribute to the Units the proceeds of such Notes together with
sufficient amounts of the initial tax collections, if needed, to effect
a 100% funding of the taxes levied, thereby providing the Units with
� an improved cash flow for local budget purposes, and
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WHEREAS, pursuant to Act 202, the City will shortly provide
notice to each of the Units of its intent to issue the Notes, and
WHEREAS, pursuant to such notice, the Units have each adopted
or are expected to adopt a resolution to consent to and request the
issuance of the Notes and to authorize the execution of an agreement
with the City (collectively, the "Tax Levy Agreements") to set forth
the responsibilities of the City and each Unit with respect to the
Notes and certain other matters relating to levy and collection of
taxes, and
WHEREAS, the issuance of the Notes will serve a public purpose,
and
WHEREAS, pursuant to Act 202, the City hereby determines
to borrow an amount to be hereafter determined by the City Council
and issue its Notes to evidence such borrowing, ard
WHEREAS, various proposals respecting the purchase and issuance
of the Notes have been received and reviewed,
NOW, THEREFORE, IT IS RESOLVED AS FOLLOWS
1 . The proposal of Morgan Stanley & Co , (the "Purchaser")
respecting the purchase and issuance of the Notes is hereby tentatively
accepted, it being understood that until final sale of the Notes,
� the City is under no obligation for expenses, costs or other liability
to the purchaser.
2 The City shall borrow an amount and issue, in anticipation
of the pledged portion of the Tax Levy, the Notes pursuant to Act
202. The exact amount of the borrowing shall be determined by further
resolution of this Council prior to issuance of the Notes.
3 The Notes shall be sold at a private sale to the Purchaser
pursuant to Act 202 in accordance with a note purchase agreement to
be negotiated A notice of the sale of the Notes shall be published
in a publication approved by the Michigan Department of Treasury within
45 days after delivery of the Notes to the Purchaser in conformity
with Act 202.
4 The Notes shall be delivered with the unqualified legal
opinion of Miller, Canfield, Paddock and Stone, bond attorneys of
Detroit, Michigan, who are designated as Note counsel with respect
to the Notes.
6 The Mayor, City Clerk, City Attorney, City Assessor,
City Treasurer and Finance Director are authorized and directed to
negotiate the terms of such certificates, official statements,
affidavits, documents or instruments as may be required or be convenient
to effectuate the execution and delivery of such documents or the
Notes
6 The Finance Director shall give notice by certified
mail to the Units of the City's intent to borrow and issue the Notes
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Land shall request each of the Units to consent to the borrowing and
approve the Tax Levy Agreements
7 The Finance Director be and is hereby directed to file
an application to the Michigan Department of Treasury for an order
of approval to issue the Notes and is authorized by law, if deemed
appropriate by the Finance Director, a request for waiver of the
requirements for credit enhancement for the Notes with the State
TrgasVrer,
8 All actions heretofore taken on behalf of the City by
the City Treasurer, the City Finance Director or other officials of
the City with respect to the issuance of the Notes, including
negotiations with the Purchasers, are ratified.
9. This Resolution shall be effective immediately upon
adoption
10 All resolutions or parts of resolutions in conflict with
this Note Authorizing Resolution shall be, and the same are, rescinded
On a motion by Councilman Feenstra, seconded by Councilman Taylor,
and unanimously adopted, it was
019-86 WHEREAS, there exists in and for the City an imperative need
to acquire, construct, furnish and equip new library facilities and
related improvements and appurtenances, as hereinafter in the attached
Contract of Lease (the "Contract") more particularly set forth, and
WHEREAS, this Council has determined, and does hereby reaffirm,
that is is necessary for the public health, safety and welfare of
the City to acquire, construct, furnish and equip said facilities
for the use of the City, and
WHEREAS, Act 31 , Public Acts of Michigan, 1948 (First Extra
Session) , as amended, provides through the procedures of building
authority financing a means for the acquisition, construction,
furnishing, equipping and financing of such facilities, and
WHEREAS, the City, in accordance with the provisions of said
Act 31 , as amended, has previously adopted Articles of Incorporation
and has established the Municipal Building Authority of Livonia (the
"Authority") , with full powers to acquire and corstruct such facilities,
and
WHEREAS, this Council determines it to be in the best interest
Lof the City to acquire and finance said facilities through the Authority
in accordance with the provisions of said Act 31 , as amended, and
WHEREAS, a Contract between the City and the Authority
providing for the acquisition, construction, furnishing, equipping
and financing of said facilities and such matters as are deemed
necessary thereto has been prepared.
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NOW, THEREFORE, BE IT RESOLVED THAT
1 This Council hereby determines it to be necessary for
the public health, safety and welfare of the City to acquire the said
facilities as set forth in the Contract attached to this resolution
for the use of the City
2. This Council deems it to be in the best interest of the
City to finance the cost of such facilities through the Authority
in accordance with the provisions of the aforesaid Act 31 , as amended.
3 This Council hereby approves the Contract for the
acquisition and financing of said facilities, as hereto attached
4 The Notice of Intention of Entering into Contract of
Lease as hereto attached shall be published in the Livonia Observer,
Livonia, Michigan, promptly upon adoption of this resolution, said
Notice to appear as a display advertisement at least one-quarter (1/4)
page in size
5 The Mayor and City Clerk of the City are authorized to
execute immediately and deliver to the Authority the Contract approved
by this resolution The Contract shall become effective upon the
expiration of forty-five (45) days following the date of publication
of the aforesaid Notice, unless, under the provisions of Section 8(b)
of said Act 31 , as amended, the effectiveness of the Contract is stayed
by the filing of a petition for referendum thereon and the resultant
necessity of prior approval thereof by the qualified electors of the
City This City Council does hereby determine that the designated
newspaper is the newspaper circulating in the City which reaches the
largest number of persons to whom the aforesaid Notice is directed
and that publication of the aforesaid Notice in designated newspaper
represents the most practical and feasible means of informing the
taxpayers and electors of the City of the aforesaid project and the
financing thereof A copy of the Contract shall be placed on file
in the office of the City Clerk and shall be available for public
examination
6 This City Council does hereby ratify and confirm its
covenant in the aforesaid Contract to levy ad valorem taxes against
all taxable property in the City to the extent necessary to meet the
obligations of the City thereunder in the event revenues from other
sources are insufficient for any reason whatsoever Any such taxes
levied to pay the Cash Rental under said Contract shall be limited
as to rate or amount in the manner provided by law
7 All resolutions and parts of resolutions insofar as the
same conflict with the provisions of this resolution be and the same
hereby are rescinded.
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NOTICE OF ILATENTIOL OF ENTERING INTO LIMITED
TAX-SUPPORTED CONTRACT OF LEASE
im AND OF RIGHT TO PETITION FOR REFERENDUM THEREON
TO THE TAXPAYERS AND ELECTORS
OF THE CITY OF LIVONIA, MICHIGAN
PLEASE TAKE NOTICE that the City of Livonia has approved
and executed a Contract of Lease with the Municipal Building
Authority of Livonia pursuant to Act No 31 , Public Acts of
Michigan, 1948 (First Extra Session) , as amended Such
Contract provides, among other things, that said Building
Authority will acquire, construct, furnish and equip a new
library facility, together with related attachments and
appurtenances for the use of the City and WILL ISSUE ITS
BONDS TO FINANCE THE ESTIM-TEL COST OF TF= SAME FOR SAID CITz'
IN THE PRINCIPAL AMOUNT OF NOT TO EXCEED $5, 000,000 Said
bonds will mature serially from 1987 to 2006, inclusive, and
will bear interest not exceeding 13% per annum on the
outstanding principal balance or such higher rate as may be
authorized by law
The Contract further provides that the City will lease
Iwosaid facilities from said Building Authority and WILL PAY AS
RENTAL TO SAID BUILDING AUTHORITY ALL SUMS NECESSARY TO
RETIRE THE PRINCIPAL OF AND INTEREST ON SAID BONDS, TOGETHER
WITH ALL COSTS OF OPERATING AND MAINTAINING SAID FACILITIES
AND ALL COSTS of said Building Authority in connection
therewith, regardless of whether the facilities are completed
or are untenantable The principal amount to be borrowed by
the Building Authority will be indebtedness of the City for
purposes of City Charter debt limitations, and said principal
amount, together with the City' s rental obligation for
payment thereof, may be increased to cover increased costs of
the facilities
CITY' S CONTRACT OBLIGATION
BY VIRTUE OF SAID CONTRACT AND ACT, ALL OF THE CITY' S
REQUIRED PAYMENTS TO THE BUILDING AUTHORITY WILL BE LIMITED
TAX FULL FAITH AND CREDIT GENERAL OBLIGATIONS OF THE CITY
PAYABLE FROM ANY AVAILABLE FUNDS OF THE CITY, AND THE CITY
WILL BE REQUIRED TO LEVY AD VALOREM TAXES ON ALL TAXABLE
PROPERTY WITHIN ITS BOUNDARIES, TO THE EXTENT NECESSARY TO
MAKE THE PAYMENTS REQUIRED TO RETIRE THE BONDS AND INTEREST
THEREON, IF OTHER FUNDS FOR THAT PURPOSE ARE NOT AVAILABLE,
iw AND AS LIMITED BY LAW
SAID CONTRACT SHALL BECOME EFFECTIVE WITHOUT VOTE OF THE
ELECTORS OF THE CITY, AS PERIITTED EY LAW, UPON THE
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EXTIRATION OF 45 DAYS FOLLOWING THE Dr:: OF PUBLICATION OF
THIS NOTICE, UNLESS A PETITION REQUESTIt.; AN ELECTION ON THE
im QUESTION OF WHETHER SUCH CONTRACT SHOULL- EE EFFECTIVE, SIGNED
BY NOT LESS THA 10% OF THE REGISTERED E_ECTORS OF THE CITY,
IS FILED WITH THE CITY CLERK WITHIN £: :D PERIOD If such
petition is so filed, said Contract s*;E:1 not be effective
without an approving vote by a majorit, of electors of the
City voting on the question
This Notice is given pursuant to the requirements of
Section 8(b) of the aforesaid Act 31 , as amended Further
information concerning the details of said Contract, the
facilities being financed and the matters set out in this
Notice may be secured from the City Cle ' s office A copy
of said Contract is on file in the office of the City Clerk
for public inspection
Clerk, City of Livonia
22530
LIMITED TAX FULL FAITH AND CREDIT GE'T.RAL OBLIGATION
CONTRACT OF LEASE
MADE AND EXECUTED this day of , 2986, by and
between the MUNICIPAL BUILDING AUTHORIn :F LIVONIA, a public
corporation organized and existing under t're. authority of Act 31,
Public Acts of Michigan, 1948, (First Extra Session) , as amended
(the "AUTHORITY" ) , and the CITY OF LIVONIA., a Michigan municipal
corporation organized and existing under t)-E Constitution and laws
of the State of Michigan (the "CITY" ) ,
WITNESSETH
WHEREAS, the AUTHORITY has been inc - orated under and in
pursuance of the provisions of Act 31 , Pic Acts of Michigan,
1948 (First Extra Session) , as amended (the "Act" ) , for the
purpose of acquiring, furnishing, equipping, owning, improving,
enlarging, operating and/or maintaining a k _ilding or buildings,
automobile parking lots or structures, re:reational facilities,
and the necessary site or sites therefor, together with
im appurtenant properties and all facilities ne=essary or convenient
for the effective use thereof, for use for any legitimate public
purpose of the CITY; and
WHEREAS, the CITY desires to acquire, ::nstruct, furnish and
equip new library facilities, together wit:e- necessary and related
appurtenances, all as described in plans therefor and in Exhibit A
attached hereto and made a part hereof (v.7.ich improvements and
related appurtenances are herein sometimes called the "Project" ) ,
and the AUTHORITY is willing to acquire the Project and lease the
same to the CITY; and
WHEREAS, the site upon which said imTrovements will be made
is described in Exhibit A attached hereto Ltd made a part hereof,
unencumbered fee simple title to which s::e, and buildings and
improvements thereon where appropriate (the "site" ) will be
acquired by the AUTHORITY pursuant to this limited Tax Full Faith
and Credit General Obligation Contract of :ease (the "Contract" ) ,
or will be purchased from bond funds, and
WHEREAS, the acquisition of the Proje:: by the AUTHORITY for
use by the CITY is necessary for the pub__: health, safety and
welfare of the CITY, and the use of the : :=HORITY to accomplish
such acquisition represents the most pract_:al means to that erd
Lm at the lowest cost to the CITY, and
22531
LisWHEREAS, the total cost of the Project is estimated to be in
the EUTT of Five Million Dollars ( $5, 000, 0:: ) , which will include
architects ' fees, legal and financing Coss, and contingencies,
and
WHEREAS, the CITY and the AUTHORITY }-a .e determined that the
cost of said Project should be paid by the authorization and
issuance of bonds ( the "Bonds" ) by the AU:FDRITY in anticipation
of the limited tax full faith and credit general obligation
contractual commitments of the CITY under this Contract, pursuant
to the provisions of the Act, in the pr.ncipal amount of Five
Million Dollars ( $5, 000, 000) , with the bala-:e of the cost of the
Project, if any, (to the extent the net proceeds derived from the
sale of the Bonds are insufficient to pay the same ) to be paid
out of moneys to be made available by the =1' to the AUTHORITY as
herein provided, and
WHEREAS, as a prerequisite to the aut- crizataon and issuance
of said Bonds, it is necessary for the parties hereto to enter
into this Contract whereby the AUTHORITY will lease the Project
and Site to the CITY and the CITY will hire the same from the
AUTHORITY for a period extending beyond the last maturity date of
said Bonds, but not to exceed a period of fifty ( 50) years, and
irWHEREAS, this Contract has been executed by the CITY pursuant
to resolution of the City Council of the CITY adopted on
, 1986, and notice thereof has been or will shortly be published
in a newspaper of general circulation in the CITY, and this
Contract shall become effective after fort,-five (45 ) days have
elapsed following such publication, if no petition for referendur
on the effectiveness of this Contract has been filed with the City
Clerk of the CITY;
IT IS, THEREFORE, AGREED BY AND BETWEEN THE PARTIES HERETO,
for and in consideration of the agreement and covenants of each
other and moneys to be paid out to the other, as follows
1 (a) The CITY will, at or prior to delivery of the
Bonds, convey and transfer to the AUTHOR:7Y, by lease or deed,
such rights in the site described in the preamble hereto as to
permit free and unrestricted use thereof by the AUTHORITY tc
acquire the Project Such conveyance shal_ be made in a forr and
manner approved by the City Attorney
(b) THE AUTHORITY will enter irto a final contract or
contracts calling for the acquisition arc construction cf said
Project prior to December 31 , 1987, and shall proceed to case the
Project to be acquired and constructed prior to said date ir
im accordance with plans prepared by the Architects, to be submitted
by the AUTHORITY to the CITY and approved by the CITY, so that
22532
imsaid Project shall be available for the _se of the CITY on cr
before January 1 , 1986
2 In consideration of the rental: and other terms ar.7:
conditions herein specified, the AUTHORI-. does hereby let an.
lease the Project and the site to the C:7Y and the CITY doe:
hereby let and lease the Project and the E.te from the AUTHORIT"I ,
TO HAVE AND TO HOLD for a term commencing :n the date possession
of the same is to be delivered hereunder ..irsuant to Section 14
hereof and ending on a day fifty (50) yea:! from the date hereof,
or such lesser period as may be authorize: by the provisions of
this Contract
3 . The CITY hereby covenants and agrees to pay to the
AUTHORITY cash rental for the use of t2-=_ Project (hereinafter
referred to as "Cash Rental " or "Cash Re' " ) in a"cunts base:
upon the AUTHC'RITY ' s debt ser . ice regJire-=,ts on the BondE , a:
hereinafter set forth
Said Bonds will be issued with p:_ncipal maturities on
June 1st of each year as follows
August
1987 $ 50, 000
1988 75, 000
1989 and 1990 100, 000
1991 and 1992 125, 000
1993 150, 000
1994 175, 000
1995 200, 000
1996 225, 000
1997 250, 000
1998 275, 000
1999 300, 000
2000 325, 000
2001 350, 000
2002 375, 000
2003 400, 000
2004 425, 000
2005 475, 000
2006 500, 000
The CITY will pay to the AUTHORIT1 commencing on May 1 ,
1987, and annually on May 1st of each yea: thereafter so long as
Bonds are outstanding, Cash Rentals in an _Dunt corresponding tc
the principal amount of Bonds maturing :- the next succee:d_r:
June 1st
lw
The CITY acknowledges also that the E::±s will be issued at a
maximum interest rate of not to exceed th::=een percent ( 13%) per
annum, and that so long as Bonds remain ou::_anding, such interest
22533
will accrue on the outstanding principal balance semiannually
Therefore, the CITY further covenants an: agrees to pay to the
AUTHORITY, as a part of Cash Rentals, ccnrencing on November 1,
1986, and semiannually on May 1st and Nc enter 1st of each year
thereafter so long as Bonds are outstanda- ; such additional sums
as shall be necessary to pay interest due :n the Bonds prior to
the next succeeding Cash Rental payment date
It is understood and agreed by the parties hereto that the
CITY' s minimum Cash Rental obligation rereunder shall be the
payment of such amounts as shall equal de:: service requirements
on the Bonds falling due prior to the ne , 1 Cash Rental payment
date However, the CITY shall retain the _nrestricted right and
privilege to prepay at any time whatever aunts of Cash Rentals
it may choose in order to fully or partial retire the Bonds and
any interest then dae thereon or in croE : to provide for such
retirement at a specified future date The total aggregate
obligation of the CITY hereunder for Cas': Rentals shall at any
given point in time be equal to the sum of the Cash Rentals yet to
be paid to retire principal of the Bonds, plus interest accrued
thereon since the last Cash Rental payment at the rate borne by
the Bonds. The CITY warrants and represerts that the amount of
its obligations under this Contract, when taken together with
other indebtedness of the CITY, will not cause its obligations
under this Contract to exceed any cons::tutional, charter or
statutory debt limitation applicable to the CITY.
The AUTHORITY shall , within thirty (30) days after the
delivery of the Bonds, furnish the CITY v_th a complete schedule
of maturities of principal and interest the:eon, and the AUTHORITY
shall also, at least thirty (30) days prior to May 1st and
November 1st of each year, advise the CEI , in writing, of the
exact amount of Cash Rental due on the rt said date, and the
CITY shall pay such amount on the due date
4 The CITY, at its own expense d_ring the term of this
Contract, shall operate, maintain and keep in repair the Project
and the site, and the total expense in connection therewith shall
be borne and paid by the CITY in additicn to all other rentals
herein required Operation and maintenance shall include any and
all costs and expenses of operation and ma:mtenance and such costs
and expenses of repairs and maintenance as are necessary to keep
the Project and the site in good repair and working order, and
shall include, but not to the exclusion cf any other items not
herein specified, heating, lighting, sr:. and debris removal ,
painting and such other repair and ma_-tenance items as are
necessary to provide for efficient operat::r of the Project and
the site, and to keep the same in good reTair and working order,
such attendants as may be necessary, as ..e_l as proper insurance
coverage Further the CITY shall pay, as part of the operation
and maintenance expense, upon writter notification by the
22534
LAUTHORITY, and within thirty ( 30) days after receipt thereof, such
amounts as shall be required to meet all rei.::nable administrative
costs and operating expenses of the AUTH0 .---Y, including paying
agent fees, Bond registration fees and any ct-.er costs or expenses
of the AUTHORITY, incidental to the issuar :e and payment of the
Bonds or attributable to the Project
5 It is understood and agreed by art between the parties
hereto that the Bonds will be issued ty the Authority in
anticipation of the CITY' s contractual Cast Rental obligation, as
stated in Section 3 hereof The CITY, purE_ant to authorization
of Section 8a of the Act, hereby recognizes and affirms that its
contractual obligations expressed in Sectic- s 3 and 4 hereof are
full faith and credit general obligations of the CITY.
The CITY expressly and irre ocably p_ ezges its lirited full
faith and credit for the prompt Cr.:: t.11-re: payrent of the Cash
Rentals pledged for Bond payments as expressed in Section 3 of
this Contract, and shall each year, commencIng with the year 1986,
appropriate from its general funds as a f:rst budget obligation
sufficient moneys to pay such Cash Renta . Such pledge shall
include, if necessary, the obligation to _evy annually such ad
valorem taxes on all the taxable propert:: in the CITY which,
taking into consideration estimated de:inquencies in tax
Lcollections, shall be fully sufficient to ;ay such Cash Rentals
under and pursuant to this Contract, such levy, however, to be
subject to constitutional , statutory and charter limitations and
not in an amount or at a rate exceeding that necessary to pay such
Cash Rentals, such levy being for the purp: se of providing funds
to meet the contractual obligations of the C:TY in anticipation of
which the Bonds are issued Nothing here - contained shall be
construed to prevent the CITY from using an. , or any combination,
of the means and methods provided in Secti:n 8a of said Act for
the purpose of providing funds to meet its cbligations under this
Contract, and if at the time of making any annual tax levy there
shall be other funds on hand earmarked and set aside for the
payment of the contractual obligations due prior to the next tax
collection period, then such tax levy ma. be reduced by such
amount
6 The CITY will include in its bud;et for the fiscal year
commencing in 1986, and shall include ir its budget for each
fiscal year thereafter, an amount sufficient to pay the total
obligations under this Contract coming due in each such fiscal
year Annually before finalization of itE budget for the next
ensuing fiscal year the CITY shall prepare and transrit to the
AUTHORITY a statement of the moneys to be :- :luded in said budget
for payment of all costs of the Project 77.e AUTHORITY shall have
the right to communicate directly with the City Council of the
CITY regarding any items in said budget re_ative to the Project
which might be disputed, and, in any event the budget shall be
22535
toreasonably adequate to cover all obligat: :- s of the CITY herein
contained in this Contract
7 The CITY may at any time pay :- advance any of the
obligations required to be paid by this C:-tract, in which event
the AUTHORITY shall credit the CITY advance payment on
future-due payments to the extent of suck advance payment The
CITY may also specify by written request t'- at any Cash Rentals
paid in advance of the requirements set out :n Section 3 hereof be
used to purchase Bonds for redemption pri:r to maturity, either
currently or at some future date, in whiz:. event the AUTHORITY
shall be obligated to apply and use said ad ance payments for such
purpose to the fullest extent possible
8. The CITY may install in the project or site such
equipment or fixtures as it may desire , l _t shall not make a-y
permanent alterations to the Project watl : _f the written conse-t
of the AUTHORITY
9 The CITY covenants and agrees that it will not permit
the use of the Project or the site in any tanner that will result
in a violation of local, state or fe:eral laws, rules or
regulations now or hereafter in force and applicable thereto and
shall keep the AUTHORITY and the members of its Commission
Lharmless and indemnified at all times against any loss, damage or
expenses by any accident, loss, casualty cr damage resulting to
any person or property through any use, mis-..se, or nonuse of said
Project and site, or by reason of an act or thing done or not done
on, in or about said Project or site or i- relation thereto Te
CITY further covenants and agrees that it will promptly, and at
its own expense, make and pay for any and all changes and
alterations in or about the Project and the site which during the
term of this Contract may be required tote made at any time by
reason of local, state or federal laws and to save the AUTHORITY
harmless and free from all costs or dama.Te in respect thereto
10. To carry out the acquisition and construction of the
Project and the financing thereof in accordance with the
provisions of said Act, the following act::ns shall be taken by
the AUTHORITY
( a) The AUTHORITY will immediate_y upon the execution
of this Contract enact the necessary resolution or ordinance
to authorize the issuance of the Bonds fn anticipation of the
Cash Rentals to be paid by the CITY here.inder The AUTHORITi
will offer for sale and take such :ther necessary legal
procedures as may be necessary to sel_ said Bonds as soon as
( i ) this Contract becomes effective a-: ( ii ) all other steps
required to be taken prior to sale cf the Bonds have been
accomplished
22536
L (b) The AUTHORITY will promptly e-,ter into and erecute
contracts for the acquisition of the iroject in accordance
with the plans and specifications therefor prepared and
approved by the AUTHORITY and the CIT. No changes in said
plans and specifications shall be rade by the AUTHORITY
without the consent of the CITY. Said contracts shall
specify a completion date of not late: than March 31 , 1987
The AUTHORITY shall not execute any contract in connection
with the acquisition of the Project u-til the same has been
approved by the City Council of the CITY.
(c ) The AUTHORITY will require and secure frorr any
contractor undertaking any work to be performed on the said
Project necessary and proper bonds to guarantee the
performance of said contract and labor and material bonds in
such amounts and in such forms as may te approved by the City
Attorney
(d) The AUTHORITY will immediately upon receipt of the
proceeds of sale of the Bonds comply with all requirements
provided for in the ordinance or resolution relative to the
disposition and use of such proceeds
(e) The AUTHORITY may invest any bond proceeds or other
funds held by it as permitted by law and investment income
shall accrue to and follow the fund producing such income
However, the AUTHORITY shall not invest, reinvest, or
accumulate any moneys deemed to be proceeds of the Bonds
pursuant to Section 103 (c) of the Ir-..ernal Revenue Code of
1954, as amended, and the applicable regulations thereunder,
in such a manner as to cause the E:nds to be "arbitrage
bonds" within the meaning of said Section 103 (c) of the
applicable regulations thereunder
11. In the event that it should be determined that for any
reason there are not sufficient funds to complete the acquisition
of the Project, or if repair, replacement or alteration of the
Project should be required to make the Project useable for its
originally intended purpose, and additional funds become necessary
therefor, it is agreed by the parties hereto that this Contract
may be supplemented or amended to provide for the issuance of
additional bonds by the AUTHORITY to provide sufficient funds to
complete, repair, replace or alter the Project and also to
increase the Cash Rental by an amount fully sufficient to pay all
principal of and interest on the Bonds here:- referred to and such
additional bonds when due
In the event such determination of irs_fficient funds should
be made after the letting of contracts for construction of the
Project, but before completion thereof, the AUTHORITY shall be
authorized, on its own motion, to issue s. :h additional bonds as
22537
immay be necessary to provide sufficient f_nds to complete the
Project or to make necessary repairs, ref .a_ements or alterations
therein, and the Cash Rental to be pa.c by the CITY shall
automatically be increased by an amount f_Ily sufficient to pay
all principal of and interest on the Bonds ierein referred to and
such additional bonds when due In the eve-t any additional bonds
are issued, the duties and obligations of the AUTHORITY and the
CITY as expressed and set forth in t' .s Contract shall be
applicable to such additional bonds as we.i as the Bonds herein
referred to, it being at all times fully recognized and agreed
that the Cash Rentals to be paid by the CITY, as specified in
Section 3 of this Contract , shall be base: upon the total a- ount
of bonds issued to pay the costs of tie Project Any such
additional bonds shall mature serially or June 1st and the Cash
Rentals coming due on November 1st and ray 1st, as shown in
Section 3 , shall be increased by the p:_- _apal amount of s.:c'r
additional bonds maturing on said June 1_ : plus the additional
interest payable thereon on May 1st and Nc ember 1st All of the
provisions of this Contract shall be applicable to said increased
amounts Immediately upon the issuance of such additional bonds,
the AUTHORITY shall furnish and supply the CITY documentation
specifying the new schedule of Bond payrents and Cash Rentals,
increased as herein authorized, which shall be substituted and
iw take the place of the schedules herein specified In the event
additional bonds are issued, all references herein to the Bonds
shall be deemed to include such additional bonds.
In lieu of the issuance of additional bonds, the AUTHORITI
and the CITY may enter into any otter mutually agreeable
arrangement to meet increased costs or brir; such costs within the
amount of funds available for construction cf the Project
12 In the event, by reason of favorable construction bids
received, or for any other reason, it is not necessary to issue
the Bonds in the full amount presently anticipated, the AUTHORITY
shall be authorized, after consultation w_:h the CITY, to reduce
the amount of Bonds to such lesser principal amount as may be
necessary to pay the cost of the Project and also to reduce the
Cash Rental of the CITY so that the payments shall be sufficient
to pay all principal of and interest cr the Bonds All the
provisions of this Contract shall be app=_cable to said reduced
amounts the same as though such Bonds End Cash Rentals were
originally in said reduced amounts In such event, the AUTHORITY
shall furnish and supply to the CITY docur.e-tation specifying the
new schedule of Bond Payments and Cash Rer:als, reduced as hereir
authorized, which shall be substituted and take the place of the
schedules herein specified
13 After completion of the Project End payment of all costs
thereof, any unexpended balance remaining from the proceeds of
sale of Bonds and the amounts to be paid by the CITY to the
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Ins AUTHORITY pursuant to Section 1 above , £- alI be used by the
AUTHORITY, upon request made by resolutzcr c: the City Council of
the CITY and with the approval of the ' _:higan Department of
Treasury (or any successor agency thereto, if any) , for
improvements or enlargement of the Pro-e:: or for any other
projects of the AUTHORITY leased to is CITY Any balance
remaining after such use shall be ap; __ed to debt service
requirements and shall reduce the next dLe Cash Rentals to the
extent of such application
14 The AUTHORITY shall deliver possession of the Project
and the Site to the CITY simultaneously it conveyance thereof by
the CITY to the AUTHORITY, as provided :- Section 1 (a) hereof
The Project shall be as herein specified, t,.t in the event that
for any reason whatsoever the Project is rst completed by that
date, the obligation of the CITY for t}E ;Eyrent of the Cash
Rentals and other costs of the Project an:. :-e performance of its
other commitments under this Contract shall .n any event remain in
full force and effect in order to provi:ie for the payment of
principal of and interest on the Bonds and other costs in
connection therewith
15 The CITY shall provide (a) liability insurance to the
extent necessary to protect the AUTHORITY and the CITY against
to loss on account of damage or injury to pers;ns or property imposed
by reason of the ownership of the Pro:e:t and the site or
resulting from any act of omission or commission on the part of
the AUTHORITY or the CITY, their agents, cfficers and employees,
in connection with the operation, maintena- :e or repair of said
Project and the site or the furnishing of service to the CITY,
(b) casualty insurance against such risks amd in such amounts as
are usually carried on projects of similar size and nature, and
(c) funds to pay the premium on a sufficient fidelity bond from
any person handling the funds of the AUTHORITY.
16 Any funds received by the AUTHOR:- or the CITY from any
insurance policies, or otherwise, because of casualty or damage to
the Project shall be used promptly to res::re the Project to a
condition satisfactory to the CITY If such funds are not
sufficient to so restore the Project, 1-_e CITY may provide
sufficient additional funds therefor in s..:: amounts as the CITY
and the AUTHORITY may agree upon, or the :::i and the AUTHORITY
may agree to issue additional bonds for such restoration, in which
event the provisions of Section 11 here:f with respect to
additional bonds and increased Cash Renta_s shall apply If in
the judgment of the AUTHORITY, concurred it the CITY, the funds
received from any insurance policies, otherwise, by the
AUTHORITY or the CITY shall be insufficient t: restore the Project
to a condition satisfactory to the CITY ar.d if additional CITY
funds are not made available or addit::nal bonds are not
authorized to make proper restoration, then, in that case, the
22539
1mm AUTHORITY shall hold and/or invest the fu- tz. paid to it by reason
of such loss for the benefit of the holders cf the Bonds, and when
upon receipt of sufficient Cash Rentals from the CITY which,
together with the proceeds of the insura- :t and other available
funds, will be sufficient to pay the princ:cal and interest on the
Bonds, said moneys shall be deposited by t-e AUTHORITY, in trust,
for the benefit of the bondholders and use: to pay the principal
and interest on said Bonds as they mature
17 The leasehold rights, duties and ccligations of the CITY
as specified in this Contract shall not be assigned nor sublet, in
whole or in part, during the term of this C:-tract or while any of
the Bonds are outstanding and unpaid, except to the extent that
such assignment or sublease benefits an: serves a legitimate
public purpose of the CITY, in which eve-t the CITY shall be
authorized tc assign this Contract or E __ et the Project, the
site, or any part thereof, but only to extent and in the
manner that the CITY could assign or sublet if it were the owner
of the Project and the site In no event sall any assignment or
subletting relieve the CITY of its primary obligations to pay the
Cash Rentals and operation and maintenance costs of the Project
and the Site hereunder or perform any of its other obligations
hereunder.
mm18. The CITY shall have, and is herebj granted, the right to
require the AUTHORITY to release from the terms and restrictions
hereof any part of the site, or any interest therein, at any time
and from time to time while the CITY is nc: in default hereunder,
without cost to the CITY, provided that CITY furnishes the
AUTHORITY with
(a) A notice, in writing, contaning an adequate legal
description of that portion of the site with respect to which
such right is to be exercised, tc,-;ether with a survey
thereof, and
(b) A certificate signed by ar engineer or architect
stating ( i ) that no part of the improve=ents constituting the
Project (other than sewer, water, gas, electric and
communication lines and other utilities , and the like, which
shall be specified in such certificace) is located on the
portion of the site with respect t: which such right is
exercised, and (ii ) that the severance cf such portion of the
site will not impair the operating or materially
alter the character of the Project ::: the balance of the
site
From and after the consummation of a- release effected by
the CITY pursuant to the provisions of this Section, any reference
herein to the site shall be deemed to refer. to the real property
described herein, and the buildings and imp7:vements thereon, less
22540
tw and except any portion or interest therelr released to the CITY
under this Section and any part theretofore released to the CIT'I
under this Section No release effected ti the CITY under the
provisions of this Section shall entitle t-e CITY to any abatement
or dimunition of the Cash Rentals or otter obligations payable
hereunder
19 The AUTHORITY, its agents, serva-ts or employees shall
have the right at all times of entering up:n the Project and the
Site for the purpose of acquiring, constructing and inspecting the
same pursuant to its commitments hereunder and determine whether
all of the terms, agreements, covenants and conditions herein
contained are being complied with
20 The CITY covenants and agrees teat it will continue to
pay to the AUTHORITI , in accordance v_:- the terms of thas
Contract, the Cash Rentals and the operatic- and maintenance costs
of the Project and the site at the times and in the manner herein
established without reduction or abatement for any cause or reason
whatsoever, including, but not limited to, casualty which results
in the Project or the site being untenantable or the failure to
have the Project restored under Section 16 hereof, and without
right of setoff or recoupment, until the principal of and interest
im on all Bonds are paid in full or adequate finds are available and
held in trust for the benefit of the holders of the Bonds for that
purpose.
21 The CITY covenants and agrees t -at if before the Bonds
have been retired default shall at any time be made by the CITY in
payments of Cash Rentals or operation and maintenance costs as
herein required or in the performance of any of its obligations
hereunder, the AUTHORITY shall have the right to use all the
remedies provided by law to correct said default, including those
specifically set forth in the Act and the ordinance or resolution
to be enacted by the AUTHORITY providing fcr the issuance of the
Bonds In the event of any such default, tte holder or holders of
the Bonds may, to the extent permitted by law, exercise and
enforce the rights of the AUTHORITY hereunder
22 The AUTHORITY and the CITY each re:ognize that the Bonds
are to be issued in anticipation of the Cas: Rentals to be paid by
the CITY hereunder and that the holders frc- time to time of the
Bonds will have contractual rights in this Contract, and it is,
therefore, covenated and agreed by each of them that so lona as
any of said Bonds shall remain outsta-iing and unpaid the
provisions of this Contract shall not be sul:ect to any alteration
or revision which would in any manner unfa -orably affect either
the security of the Bonds or the prompt pa:anent of principal or
interest thereon The AUTHORITY and the CI.' further covenant and
agree that they will each comply with their respective duties and
obligations under the terms of this Contract promptly at the times
22541
iwand in the manner herein set forth and wi :: not suffer to be done
any act which would in any way impair the f:_d Bonds , the security
therefor, or the prompt payment of principa. and interest thereon
The CITY may, in writing, waive strict cotr; _:ance by the AUTHORITY
with the dates set out herein for the e-tering into of final
construction contracts and for completion cf the Project, and such
dates may be altered upon mutual agreement the parties hereto
23 Any notice necessary or proper tc be given to any of the
parties hereto may be served in the follow:-: manner
(a ) If to the AUTHORITY, by de: . ering the same to any
member of the Commission thereof,
(b) If to the CITY, by deliverirg the same to the City
Clerk or deputy
24 This Contract shall terminate or the payment in full of
all principal and interest on all the Bond= When the Bonds have
been retired and the Contract terminated the AUTHORITY shall
convey the Project and the site t: the CITY, without
consideration, by quit claim deed and apprc.:fate bills of sale in
such form and manner as may be approved by the City Attorney
Upon termination of this Contract in the rcnner set forth above,
iw the AUTHORITY shall promptly pay over tc the CITY any and all
funds held by it pertaining to the aforesa::: Bonds or in any other
manner relating to the Project.
25 The AUTHORITY covenants that t:= CITY upon compliance
with the terms of this Contract, shall may peacefully and
quietly have and hold and enjoy the Project and the site for the
term herein provided
26 Nothing herein contained shall it any way be construed
to prevent additional financing under the provisions of the Act,
or any other law, for any of the purposes set out in the Articles
of Incorporation of the AUTHORITY.
27 This Contract shall inure to _e benefit of and be
binding upon the respective parties heretc their successors and
assigns
22542
iw EXHIBIT A
PROJECT DESCRIPTION
The Project consists of the acqu:s:tion, construction,
furnishing and equipping of new library fa::lities together with
related appurtenances and attachments to be situated on the
following described property
That part of the N W ; of Section 22,
T 1S, R 9E, City of Livonia, Wayne County,
Michigan, described as beginning at a point
distant S 1° 25 ' W. along the West line of
said Section 22 , 831 32 feet and 5 88° 35 '
30" E along the Southerly anc Easterly
lines of Civic Center Drive ( 66 feet wide) ,
as extended, 676 feet and on a curve to the
left, said curve having a radius of 173 feet
and an arc distance of 271 .75 feet, thence
N 0° 37' 53" E. , 56 02 feet to the Point of
Beginning; proceeding thence N 0° 37 ' 53"
tm E. 500 feet to the South line of Five Mile
Road; thence S. 88° 29' E , 872.70 feet;
thence S. 0° 37' 53" W , 500 feet; thence
N. 88° 29' W. , 872 .70 feet to the Point of
Beginning
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PRINCIPAL A?ID IN:E=.EST REQUIREMENTS FOP
$5, 000, 000 MUNICIPAL E_ILDING AUTHORITY OF LIVONIA
ir BUILDING AUTHORITY BONDS, LLERIES 1986, DATED JULY 1 , 1986
Principal Interest* Interest*
Year Due 6/1 Due 6/1 Due 12/1 Total
1986 $208 , 333 $208 , 333
1987 $ 50, 000 $250, 00: 247, 500 547, 500
1988 75, 000 247, 50C 243, 750 566, 250
1989 100, 000 243 , 7E. : 238 , 750 582 , 500
1990 100, 000 238, 75C 233, 750 572, 500
1991 125, 000 233, 71 : 227 , 500 586 , 250
1992 125, 000 227, 50: 221, 250 573, 750
1993 150, 000 221, 25C 213, 750 585, 000
1994 175, 000 213, 75C 205, 000 593, 750
1995 200, 000 205, 00C 195, 000 600, 000
Lw 1996 225, 000 195, 00C 183, 750 603, 750
1997 250, 000 183, 75: 171 , 250 605, 000
1998 275, 000 171, 25: 157 , 500 603,750
1999 300, 000 157, 50: 142 , 500 600, 000
2000 325, 000 142, 50[ 126, 250 593, 750
2001 350, 000 126, 25: 108 , 750 585, 000
2002 375, 000 108, 750 90, 000 573, 750
2003 400, 000 90, 00: 70, 000 560, 000
2004 425, 000 70, 00: 48 , 750 543 , 750
2005 475, 000 48, 75: 25, 000 548 , 750
2006 500, 000 25 , 0C : 525, 000
iw
*Interest computed at 10% per arm gun.
22544
On a motion by Councilman Bennett, seconded by Councilwoman McCotter,
and unanimously adopted, this 195th Special Meeting of the Council of the City
of Livonia was duly adjourned at 8 05 P.M. , May 28, 1986
CT\
Robert Nash, City Clerk