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Home My WebLink About5479 RESOLUTION NO. 5479 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARCADIA APPROVING THE ISSUANCE AND SALE BY THE ARCADIA REDEVELOPMENT' AGENCY OF ARCADIA OF ITS CENTRAL REDEVELOPMENT PROJECT, TAX ALLOCATION REFUNDING BONDS, SERIES 1989, AMENDING CERTAIN RESOLUTIONS RELATING TO LOANS MADE BY THE CITY TO THE AGENCY AND AUTHORIZING CERTAIN OTHER ACTIONS RELATING THERETO WHEREAS, the Redevelopment Agency of Arcadia (herein sometimes referred to as the .Agency.), is a redevelopment agency (a public body, corporate and politic) duly created, established and authorized to transact business and exercise its powers, all under and pursuant to the Community Redevelopment Law Part 1 of Division 24 (commencing with Section 33000) of the Health and Safety Code of the State of California and the powers of the Agency include the power to issue bonds to refinance notes; and WHEREAS, a Redevelopment Plan:, known as the' Redevelopment Plan for the Central Rec!evelopment project has been adopted and approved by Ordinance No. 1490 of the City of Arcadia (the .City.), and all requirements of law for and precedent to the adoption and approval of said Redevelopment Plan, and amendments thereto, have been duly complied with; and -1- 5479 WHEREAS, the Agency has approved the issue and sale of not to exceed $4,000,000 of its Central Redevelopment Project Tax Allocation Refunding Bonds, Series 1989 (the .Bonds.); and WHEREAS, Section 265 of the Internal Revenue Code of 1986 (the .Code.) provides that, under certain circumstances, certain obligations the interest on which is excludable from gross income for federal income tax purposes pursuant to Section 103 of the Code may be designated by the issuer thereof as .qualified tax-exempt obligations., thereby allowing certain financial institutions that are owners of such obligations a deduction for a portion of such institution's interest expense that is allocable to tax exempt interest, all as determined in accordance with Section 265 and 291 of the Code and the City desires to designate the Bonds as .qualified. tax-exempt obligations. within the meaning of Section 265 of the Code; and WHEREAS, the City has found and determined that: (1) the Bonds to be delivered pursuant to Resolution No. ARA 137, adopted by the Agency on May 16, 1989 (the .Resolution.), are not private activity bonds within the meaning of Section 141 of the Code; (2) the net proceeds of the Bonds are to be used to refinance certain notes .the proceeds of which were used for local governmental activities of the Agency on behalf of the City; -2- 5479 3696001/2 (LA) (3) neither the City nor any subordinate entities thereof has heretofore issued or caused to be issued any obligations in calendar year 1989 the interest on which is exempt from federal income taxes pursuant to Section 103 of the Code; and (4) neither the City nor any subordinate entities thereof reasonably anticipates issuing or causing to be issued during the balance of the calendar year 1989 any obligations whiCh, together with the Bonds, will aggregate in excess of $10 million in principal amount, the interest on which is excludable from gross income for federal income tax purposes pursuant to Section 103 of the Code. WHEREAS, the Agency's financial consultant has recommended to the Agency that repayment of all outstanding loans from the City to the Agency be subordinated to the payment of the principal of and interest on the Bonds and Additional Bonds (as defined in the Agency Resolution referred to above) in order to realize a lower interest rate on the Bonds; NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ARCADIA, DOES HEREBY RESOLVE, DETERMINE AND FIND AS FOLLOWS: SECTION 1.' APPROVAL OF ISSUANCE OF BONDS. The issuance and sale of not to exceed $4,000,000 principal amount of Central Redevelopment Project Tax Allocation Refunding Bonds, Series 1989, to. refinance certain notes issued for the corporate purposes of the Agency relating to the Central Redevelopment Project, and for other purposes related thereto, all of which -3- 5479 3696001/2 (LA) consti tute a - redevelopment activity, - as such term is defined in Health and Safety Code Section 33678, is hereby autho'rized and approved. SECTION 2. DESIGNATION AS QUALIFIED TAX EXEMPT OBLIGATION. The Bonds to be issued under the Resolution are hereby designated as -qualified taz-exempt obligations- within the meaning of Section 265(b) (3) of the Code and the Bonds ~ay contain a legend thereon to that effect. SECTION 3. SUBORDINATION 01' CERTAIN LOANS. Repayment by the Agency of all current and future loans from the City to the Agency,' including, but not limited to, loans made pursuant to Resolutions 4608, 4728, 5040 and 5321, shall be subordinate to repayment of the principal of and interest on the Bonds; and that each and every Loan Agreement entered into pursuant to said resolutions is and hereby shall be amended by adding thereto the fOllowing provision: -Notwithstanding any provision set forth in this Agreement to the contrary, all obligations of the Agency to the City hereunder, including but not limited to the Obligation to pay the principal of and interest hereunder, shall be subordinate to the repayments of the principal of and interest on Bonds as described under Resolution No. ARA 137, adopted by the Agency on May 16, 1989, as amended and supplemented from time to time.- .' .~.- -4- 5479 3696001/2 (LA) SECTION 4. CONFIRMATION AND RATIFICATION OF CERTAIN ACTIONS. The City hereby confirms and ratifies the annual extension of the maturity date of each Loan Agreement authorized under the resolutions described under Section 3 hereof, such extensions having been made to June 30, 1987, June 30, 1988 and June 30, 1989. The City hereby agrees to the extension of each such maturity date from June 30, 1989 to June 30, 1990. SECTION 5, This Resolution shall take effect upon adoption. SECTION 6. The Gity Clerk shall certify to the adoption of this resolution. Passed, approved and adopted this 16th day of May, 1989. Arcadia '. --.. ATTEST: J rcadJ.a CJ.t 'i .-'>.... -5- 5479 3696001/2 (LA) STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) CITY OF ARCADIA ) I, June Alford, City Clerk of the City of Arcadia, hereby certify that the foregoing Resolution No. 5479 was passed and adopted by the City Council of the City of Arcadia, signed by the Mayor and attested to by the City Clerk at a regular meet~ng of said Council held on the 16th day of May, 1989, and that said Resolution was adopted by the following vote, to wit: AYES: Councilmember Harbicht, Lojeski, Young and Chandler NOES: None ABSENT: Councilmember GiIb City Clerk of the City of Arcadia -6- 5479 369600112 (LA)