Resolution 2018-30354 RESOLUTION NO. 2018-30354
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE
CITY OF MIAMI BEACH, FLORIDA, AUTHORIZING THE SECOND
EXTENSION OF THE TERM OF THE LOAN IN AN AGGREGATE
PRINCIPAL AMOUNT NOT TO EXCEED $60,000,000 OUTSTANDING
AT ANY TIME FROM WELLS FARGO BANK, NATIONAL
ASSOCIATION; AUTHORIZING THE EXECUTION AND DELIVERY OF
SECOND AMENDED AND RESTATED LOAN AGREEMENT AND
PROMISSORY NOTES IN CONNECTION WITH SUCH SECOND
EXTENDED LOAN; AND AUTHORIZING OTHER ACTIONS IN
CONNECTION WITH THE SECOND EXTENDED LOAN AND THE
FINANCING PROGRAM.
WHEREAS, the City of Miami Beach, Florida (the "City") is duly authorized,
pursuant to the Constitution of the State of Florida, Chapter 166, Part II, Florida
Statutes, as amended, Chapter 159, Part VII, Florida Statutes, as amended, and the
Charter of the City (collectively, the "Act"), to borrow money to finance capital projects;
and
WHEREAS, in connection with the City's interim financing of capital projects (the
"Financing Program"), on May 30, 2014, the City and Wells Fargo Bank, National
Association (the "Bank"), entered into a loan through two revolving lines of credit in an
aggregate principal amount not to exceed $60,000,000 outstanding at any time (the
"Original Loan"); and
WHEREAS, the Original Loan had a maturity date of May 30, 2016 and in 2016
the maturity date was extended until July 28, 2018 (the "Extended Loan'); and
WHEREAS, the parties have now determined to extend the term of the Extended
Loan for an additional two year period under the provisions of the Loan Agreement and
the Notes hereinbelow described (the "Second Extended Loan"); and
WHEREAS, in connection with the extension of the term of the Extended Loan,
the City will execute and deliver to the Bank a Second Amended and Restated Loan
Agreement (the "Loan Agreement") and a Second Amended and Restated Tax-Exempt
Note and a Second Amended and Restated Taxable Note (such notes collectively, the
"Notes"); and
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA:
SECTION 1. DEFINITIONS.
Terms defined in the preambles shall have the meanings set forth in such
preambles. All capitalized terms used in this resolution (the "Resolution") which are
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defined in the Loan Agreement shall have the meanings assigned in the Loan
Agreement, unless the context affirmatively requires otherwise.
SECTION 2. FINDINGS.
The preambles are incorporated as findings. In addition, it is found, determined
and declared that the Financing Program and the Second Extended Loan are permitted
under the Act, are necessary and desirable, are in the public interest and will serve a
proper public purpose.
SECTION 3. SECOND EXTENDED LOAN AUTHORIZED.
The Second Extended Loan in an aggregate principal amount not to exceed
$60,000,000 outstanding at any time to undertake the Financing Program, as described
in this Resolution and in the manner provided in the Loan Agreement, is authorized and
approved.
SECTION 4. AUTHORIZATION OF EXECUTION AND DELIVERY OF LOAN
AGREEMENT.
The Loan Agreement, in substantially the form of the Amended and Restated
Loan Agreement executed in connection with the Extended Loan, with such changes,
alterations and corrections as may be necessary to extend the Extended Loan and as
may be approved by the City Manager of the City (the "City Manager"), after
consultation with the Chief Financial Officer of the City (the "Chief Financial Officer")
and the City Attorney of the City (the "City Attorney"), such approval to be presumed by
the execution by the Mayor of the City (the "Mayor') of the Loan Agreement, is
approved by the City. The City authorizes and directs the Mayor to execute and the
City Clerk or Deputy City Clerk of the City (the "City Clerk") to attest under the seal of
the City the Loan Agreement and to deliver the same to the Bank.
SECTION 5. ISSUANCE OF NOTES.
The Second Extended Loan shall be evidenced by the Notes. The Notes, in
substantially the forms of the Amended and Restated Tax-Exempt Note and the
Amended and Restated Taxable Note executed in connection with the Extended Loan,
with such changes, alterations and corrections as may be necessary to extend the
Extended Loan and as may be approved by the City Manager, after consultation with
the Chief Financial Officer and the City Attorney, such approval to be presumed by the
execution by the Mayor of the Notes, are approved by the City. The City authorizes and
directs the Mayor to make and execute the Notes and to issue and deliver the Notes to
the Bank.
SECTION 6. GENERAL AUTHORITY.
The City's officials, officers, attorneys, agents and employees are authorized to
do all acts and things and execute and deliver any and all documents necessary by this
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010-8630-8970/1/AMERICAS
Resolution, the Loan Agreement or the Notes, or desirable or consistent with the
requirements of this Resolution, the Loan Agreement or the Notes, in order to obtain the
Second Extended Loan, accomplish the Financing Program and provide for the full,
punctual and complete performance of all the terms, covenants and agreements
contained in the Loan Agreement, the Notes and this Resolution, including the
execution of any necessary Tax Compliance Certificate and the execution and filing of
any necessary form or other document with the Internal Revenue Service with respect
to any Advance under the Tax-Exempt Note.
SECTION 7. SEVERABILITY OF INVALID PROVISIONS.
If any one or more of the provisions contained in this Resolution shall be held
contrary to any express provisions of law or contrary to the policy of express law,
though not expressly prohibited, or against public policy, or shall for any reason
whatsoever be held invalid, then such covenants, agreements or provisions shall be null
and void and shall be deemed separable from the remaining covenants, agreements or
provisions and shall in no way affect the validity of any of the other provisions of this
Resolution or of the Loan Agreement or the Notes.
SECTION 8. REPEALING CLAUSE.
All resolutions or parts of such resolutions of the City in conflict with the
provisions contained in this Resolution are, to the extent of such conflict, superseded
and repealed.
SECTION 9. EFFECTIVE DATE.
This Resolution shall become effective immediately upon adoption.
PASSED AND ADOPTED this & day of Jbnt , 2018.
Mayor
Attest: 7
/ , )i,r.-s 2e/ Lc 1Y --2::-71---.:--±,:-: APPROVED AS TO
City Clerk ,` i\\ 5 FORM &LANGUAGE
C/ ti � 8 FOR EXECUTION
47 , =l
City Attorney RILW Date
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Resolutions - R7 I
MIAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Jimmy L. Morales, City Manager
DATE: June 6, 2018
SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA, AUTHORIZING THE SECOND EXTENSION OF THE
TERM OF THE LOAN IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO
EXCEED $60,000,000 OUTSTANDING AT ANY TIME FROM WELLS FARGO BANK,
NATIONAL ASSOCIATION; AUTHORIZING THE EXECUTION AND DELIVERY OF
SECOND AMENDED AND RESTATED LOAN AGREEMENT AND PROMISSORY
NOTES IN CONNECTION WITH SUCH SECOND EXTENDED LOAN; AND
AUTHORIZING OTHER ACTIONS IN CONNECTION WITH THE SECOND
EXTENDED LOAN AND THE FINANCING PROGRAM.
RECOMMENDATION
The Administration recommends that the Mayor and City Commission adopt the Resolution.
ANALYSIS
The City's current Line of Credit ("LOC') was executed on May 30, 2014 to provide the City with
liquidity to continue to award contracts for new water, sewer, storrrrwater, and general fund projects.
On that date, the City and Wells Fargo Bank entered into a loan through two revolving lines of credit
in an aggregate principal amount not to exceed $60 million outstanding at any time. The loan
agreement allowed for tax-exempt draws up to $59 million and taxable draws up to$1 million.
This loan had a maturity date of May 30, 2016, and on May 12, 2016, the maturity date was extended
for 60 days until July 29, 2016. The term was extended for an additional two year period effective
July 30, 2016, with a new maturity date of July 30, 2018. To date, the City has not drawn on this line
of credit.
Due to the continued need for liquidity to award contracts for new water, sewer, stormwater and
general fund (general obligation Bond) projects, the City would like to extend the LOC for an
additional two year period. The City may also utilize the LOC for borrowings for short-term capital
and equipment needs in the future.
The City has the legal authority to obtain a line of credit pursuant to the Constitution of the State of
Florida, Chapter 166, Part II, Florida Statutes, as amended, Chapter 159, Part VII, Florida Statutes,
as amended, and the Charter of the City (collectively, the "Act"), to borrow money to finance capital
projects.
The LOC will be secured by a covenant to budget and appropriate non-ad valorem revenues. The
annual fees for unused credit will remain the same as the prior agreement. The formula for draws on
the LOC will adjust from the original agreement due to the recent change in the corporate tax rate.
Below is a schedule summarizing the terms of the amended agreement compared to the prior
agreement.
Page 873 of 1103
Amended Prior
Agneemert Agreement
Credit Amount •_:_ ::__._ 5'_: :::
Term
Upfront Fee SO 5:
AmuaIFee for Unused Credit 25 tics (S1!D.X 2t ccs
A mua I Interest on Draws:
Tax-Exempt lupto553 million: 5?::x(1IILIBOR+D.`_`_'.. 7:!1X '1.'�I3:.R-:
Ta wade up to St million; •!'LIKR•In% 'V_ISOR-:-`_':
Difference
Total cost::o burro;.mg
Total cost:r'S6C1.1 borror:ing'
Indicative Interest Rate IVa ruble: 5 . :<F,':
-3.r=r23 _3 ___. _• _ __ ___• ._ SiA9_
The City utilizes the line of credit to meet its financial commitment needs and be in compliance with
state law while spending its existing bonds proceeds and to provide capacity to award new projects in
advance of longer term financing.
In recommending the renewal of this line of credit versus other financing options, the City's CFO
worked in conjunction with the City's Financial Advisor, who concurred on this type of financing and
on the competitiveness of the rates. This line of credit offers attractive legal terms and a low cost of
the ability to encumber and access funds.
Legislative Tracking
Finance
ATTACHMENTS:
Description
u Resolution
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