11-01-05 Item 5South Miami
To: Honorable Mayor, Vice Mayor &
RE
Date: November 1, 2005
Agenda Item # 30
Re: Authorizing the City Manager to obtain
financing for the purchase of the YMCA
property
On June 14, 2005, the City Commission. approved, on second reading, ordinance # 16-05-1838
authong the purchase of the YMCA property located at 4300 SW 58 Avenue. Section I of
the ordinance authorized the City Manager ♦ secure a is in the amount of $2,750,000 to be
utilized for the purchase of the property (see attached).
The Administration has completed negotiations of loan terms with SunTrust Bank as outlined in
the attached commitment letter from SunTrust. SunTrust has locked in these rates through
November 12, 2005. The attached resolution is intended to provide specific clarification of these
terms of the loan authorized by ordinance # 16-05-1838.
1 !14 DCKIIJI Id-I I - V
We recommend that the attached resolution be adopted, approving the terms of the loan for the
purchase of the YMCA property.
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RESOLUTION NO.
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF SOUTH MIAMI, FLORIDA, RELATING TO ORDINANCE 16-
05 -1838 AUTHORIZING THE CITY MANAGER TO OBTAIN
FINANCING TO PURCHASE THE YMCA PROPERTY LOCATED AT
4300 SW 58TH AVENUE IDENTIFYING THE LENDER AND PROVIDING
FURTHER CLARIFICATION OF SEC. OF ORDINANCE 16 -05 -1838
RELATING TO THE SPECIFIC TERMS AND CONDITIONS OF THE
LOAN AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the Mayor and City Commission of the City of South Miami adopted
Ordinance no. 16 -05 -1838, which authorized the city manager to negotiate and secure a loan for
the purpose of purchasing of the YMCA property located at 4300 SW 581h Avenue in the City of
South Miami; and
WHEREAS, section 1 of the ordinance provides that:
The City of South Miami authorizes the City Manager to borrow the sum of
$2,750,000.00 to be specifically utilized for the purchase of the Property.
NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF SOUTH MIAMI, FLORIDA;
Section 1. The Mayor and City Commission, have considered and find the specific
terms and conditions contained in Sun Trust Bank's commitment letter dated October 3, 2005
which is attached to this resolution to be acceptable.
Section 2. This resolution shall take effect immediately upon approval.
PASSED AND ADOPTED this day of , 2005.
ATTEST:
CITY CLERK
READ AND APPROVED AS TO FORM:
CITY ATTORNEY
APPROVED:
MAYOR
COMMISSION VOTE:
Mayor Russell:
Vice Mayor Palmer:
Commissioner Wiscombe
Commissioner Birts- Cooper:
Commissioner Sherar:
ORDINANCE NO. 16 -05 -1 838
AN ORDINANCE OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF SOUTH MIAMI, FLORIDA, RELATING TO REAL PROPERTY;
AUTHORIZING THE PURCHASE OF THE PROPERTY LOCATED AT
4300 SW 58TH AVENUE CONSISTING OF A RECREATION CENTER AND
ADMINISTRATIVE OFFICE BUILDING, BASKETBALL COURTS, A
RACQUETBALL COURT, SWIMMING POOL, AND APPROXIMATELY 7
ACRES OF OPEN FIELD SPACE, WITH DEBT SERVICE CHARGED TO
THE NON - DEPARTMENTAL DEBT SERVICE -YMCA ACCOUNT CODE
00102100.519.9927, AUTHORIZING THE CITY TO ACCEPT THE DEED TO
THE PROPERTY UPON CLOSING AND REQUESTING TAX EXEMPTION
OF THE PROPERTY; PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City of South Miami has negotiated an agreement to purchase of the
property owned by the YMCA located at 4300 SW 58t Avenue consisting of a recreation center
and administrative office building; basketball courts, racquetball court, swimming pool, and
approximately 7 acres of open -field space (the "Property"), the legal description of which is more
fully described as follows:
24 54 40 10 AC S%Z OF SWI/ OF NE1/ OF NEI/ LESS E25FT
FOR R/W & SV2 OF SEI/ OF NWI /4 OF NEY4 LOT SIZE
IRREGULAR
WHEREAS, the City Commission of the City of South Miami desires to purchase the
property, accept the deed upon purchase and to dedicate the property to public use.
NOW THEREFORE BE IT ORDAINED BY THE MAYOR AND CITY,COMMISSION
OF THE CITY OF SOUTH MIAMI, FLORIDA;
Section 1. The City of South Miami authorizes the City Manager to borrow the sum of
$2,750,000.00 to be specifically utilized for the purchase of the Property.
Section 2. That funding for debt service on the loan be provided from account code
001.2100.519.9927 that has an available balance of $84,000 in FY 2004 -05:
Section 3. The City of South Miami authorizes payment to the seller, the YMCA of
Greater Miami, as to the purchase price for the Property;
Section 4. ; Upon transfer of the property, the City of South Miami shall accept delivery
and shall immediately record the deed for the Property. The property shall be dedicated to public
use. The City shall immediately apply for tax exemption for the property.
Section 5. This ordinance Shall take effect immediately upon enactment.
Signature Page to Follow
Pg. 2 of Ord. No. 16 -05 -1838
PASSED AND ADOPTED this day of June, 2005.
ATTEST: APPROVED:
ITYCLERK &AYOR
I st Reading - 5 / 17 / 0 5
2nd Reading -6 /14 / 0 5
COMMISSION VOTE: 4-0
READ AND APPROVE AS TO4 : M: Mayor Russell: Yea
Vice Mayor Palmer: absent
Commissioner Eirts- Cooper: Yea
CITY-ATTORNEY Commissioner Sherar: Yea
Commissioner Wiscombe: Yea
CAMy DocumentMord Documents \OrdinanceYMCAPurchase.doc
Stmfl'aUSr
SunTrust Bank (hereinafter referred to as the "Bank") is pleased to inform you that it has approved
and hereby extends to the City of South Miami its commitment to provide three credit facilities
totaling $2,750,000 (hereinafter referred to as the "Loan'') under the following terms and conditions,
and such additional terms and conditions as may be reasonably required heretofore.
PIM11074i M#
1. BORROWER:
City of South Miami (hereinafter referred to as the "Borrower")
2. FACILITIES:
$1,925,000 in tax-exempt Bank-Qualified loans – (Loan I & Loan 2).
Loan 1: Line of Credit in the amount of $1,675,000 for a period of 2 years.
Loan 2: Term Loan in the amount of $250,000 for a period of 5 years.
$875,000 in a Bank taxable loan – (Loan 3)
Loan 3: Line of Credit in the amount of $850,000 for a period of 2 years.
3. PURPOSE:
To purchase the YMCA property located within the City's boundaries. The City plans to
lease the building back to seller and use the fields mainly for City programs and leasing to
different sports leagues for their tournaments. The Loan will be repaid with funds from part[
grants and other revenue sources.
4. COLLATERAL:
The Loan shall be secured by a pledge of the lease revenues on the property being purchased.
Should the collected lease payments not be sufficient to cover the debt service on the Loan,
the City pledges to Budget and Appropriate (Back-up CBA) from non-ad valorem revenues
sufficient funds to cover the required debt service.
5. INTEREST RATE (Good thru October 7, 2005 only):
Loan I – A Bank Qualified fixed rate of 3.52 %o during the entire term of the Loan.
Loan 3— A Taxable fixed rate of 5.89% during the entire term of the Loan.
A=
ODMMITMENT LErM FORCM OF SOUTH MLAM
September 3, 2005
Page 2
6. REPAYMENT:
Loan I & Loan 3 - These two lines of credit will be "interest- only" payable every quarter
with g
lEponal principal payment on the part of Borrower at anytime with no prepayment
penalty. All unpaid principal will be due at maturity.
Loan 2 - Quarterly principal payment of 12,500 plus interest. There shall be no prepayment
p,n glassociated with facility during the 5-year term.
7. MATURITY:
Loan I and Loan 3 will mature 2 years from closing.
Loan 2 will mature 5 years from closing.
S. FEE(S) AND EXPENSES:
The Borrower shall be required to pay all reasonable and necessary expenses associated with
the contemplated transaction, including but not limited to those listed below:
I. Loan Counsel Fee for reviewing and preparing all legal documents for this transaction,
which shall be capped at a maximum of $12,000.
9. DOCUMENTATION:
At or prior to closing, the Bank shall have received all documents that are typical for
transactions of this nature
10. FINANCIAL REPORTING REQUIREMENTS:
The Borrower shall submit audited financial statements to the Bank not less than annually.
The Borrower shall also submit an operating budget for all funds, as ratified by the Mayor and
City Commission, to the Bank not less than annually.
The Bank will require that the two years average non-ad valorem revenues for Borrower, -with
the exception of enterprise fund revenues, must equal or exceed two times combined
maximum annual debt service on all outstanding and proposed debt secured by specific or
general non-ad valorem revenues-
Funding of the Loan is contingent upon a satisfactorily legal opinion as to the Borrower's tax-
exempt status and authority under its Charter to borrow money, as well to the fact that Loan 1
and Loan 2 constitute bank-qualified status. The authority to borrow money must be
.c., eptabl in form, manner, tenure and purpose.
The Bank reserves the right, upon reasonable notice to the Borrower, to change the pricing of
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COMMITMENT LETTER FOR CITY OF SOLFTH MIAMI
Septeember 3, 2oo5
Page 3
The Borrower will comply with and agree to such other covenants, terms and conditions that
may be reasonably required by the Bank and its counsel and are customary in tax-exempt
financing of this nature. These covenants would include, but not be limited to, covenants
regarding compliance with laws and regulations, the submission of audited financial
statements to the Bank on a timely basis, events of default including failure to make
payments, failure to perform any covenant, and the filing of bankruptcy by the Borrower, and
remedies in event of default.
We sincerely appreciate the opportunity to serve the City of South Miami and look forward to hearing
from you. Please sign below upon acceptance and return the original to my attention. If you have any
questions please call me at (305) 579-7014.
Sincerely,
Delle Joseph
Vice President
Institutional & Governmental Banking
SunTrust Bank, South Florida
Tel: 305.579.7014
ACCEPTANCE:
The terms and conditions of this Commitment Letter are hereby accepted.
111=1
City of South Miami, FL
L-02
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