HomeMy WebLinkAbout06-278 Resolution No. 06-278
RESOLUTION
ASSIGNING UNALLOCATED PRIVATE ACTIVITY BOND AUTHORITY
FOR THE YEAR 2006 TO THE ILLINOIS HOUSING DEVELOPMENT AUTHORITY
WHEREAS,the City of Elgin("City")is an Illinois municipal corporation and a home rule
unit pursuant to Article VII, Section 6(a)of the 1970 Constitution of the State of Illinois; and
WHEREAS,Section 146 of the of the U.S.Internal Revenue Code of 1986(26 U.S.C. § 146)
("Code") subjects certain private activity and non-private activity bonds to volume limitations or
"volume cap" ("Volume Cap"); and
WHEREAS,the Code provides that the City has a private activity bond Volume Cap equal to
$80.00 per resident of the City in each calendar year and that such Volume Cap may be reserved and
allocated to certain tax-exempt private activity bonds; and
WHEREAS, the Illinois Private Activity Bond Allocation Act (30 ILCS 345/1 et seq.)
("Act") provides that a home rule municipality may transfer its allocation of Volume Cap to any
other home rule municipality,any non-home rule municipality,or the State of Illinois and any of its
agencies; and
WHEREAS,the City of Elgin has $6,070,880 of private activity bond authority remaining
under its 2006 Volume Cap; and
WHEREAS,the Illinois Housing Development Authority("IHDA"),an agency of the State
of Illinois, has requested that the City reassign its remaining unallocated private activity bond
authority for the year 2006 to IHDA for use in conjunction with the proposed acquisition and
renovation of the property commonly known as Buena Vista Townhomes, 1285 Fleetwood Drive,
Elgin, Kane County, Illinois; and
WHEREAS, subject to Article VII, Section 6(a) of the 1970 Constitution of the State of
Illinois, a home rule unit may exercise any power and perform any function pertaining to its
government and affairs for the protection for the public health, safety,morals and welfare; and
WHEREAS, the availability of decent, safe and sanitary housing is essential to retain and
increase industrial and commercial activities and relieve conditions of unemployment in the City and
are matters pertaining to the government and affairs of the City; and
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
ELGIN,ILLINOIS:
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Section 1. The City hereby reserves and reallocates to IHDA$6,070,880 of the City's private
activity bond authority for the year 2006 for utilization by IHDA in connection with the proposed
acquisition and renovation of the property commonly known as Buena Vista Townhomes, 1285
Fleetwood Drive, Elgin, Kane County, Illinois.
Section 2. The city manager and city clerk shall provide notice of the City's reallocation of
its private activity bond authority for the year 2006 in the amount of$6,070,880 to IHDA to the
Office of the Governor of the State of Illinois on the form created by IHDA for such purpose.
Section 3. The City shall maintain a written record of this resolution in its records during the
term that private activity bonds to which such Volume Cap allocation remain outstanding.
Section 4. The mayor, city clerk, and all other proper officers, officials, agents and
employees of the City are hereby authorized,empowered and directed to do all such acts and things
and to execute all such documents and certificates as may be necessary to further the purposes and
intent of this resolution, including without limitation, to obtain a reallocation of the remaining
Volume Cap.
Section 5. That all ordinances,resolutions or parts thereof,in conflict with the provisions of
this resolution, to the extent of such conflict, are hereby superseded, and this resolution shall be in
full force and effect upon its passage.
s/Ed Schock
Ed Schock, Mayor
Presented: November 29, 2006
Adopted: November 29, 2006
Omnibus Vote: Yeas: 7 Nays: 0
Attest:
s/Dolonna Mecum
Dolonna Mecum, City Clerk
OF Etc,
""`"� �" Agenda Item No.
,! flu City of Elgin g
November 3, 2006
NORTHWEST
TO: Mayor and Members of the City Council
FROM: Olufemi Folarin, Cityr
Manager g l ;,;;znuair Growth and
Raymond H. Moller, Di ector of Economic Diver k'd it x Ba e
Development
SUBJECT: Transfer Remaining Industrial Revenue Volume Cap to the Illinois Housing
Development Authority
PURPOSE
The purpose of this memorandum is to provide the Mayor and members of the City Council with
information to consider the transfer of $6,070,880 of the City's remaining Industrial Revenue
Bond (IRB) capacity to the Illinois Housing Development Authority for use by Evergreen Real
Estate, L.L.C. to acquire and renovate the Buena Vista Townhome Complex.
RECOMMENDATION
It is recommended that the City Council authorize the transfer of $6,070,880 to IHDA for the
purchase of the Buena Vista Townhome Complex by Evergreen Real Estate.
BACKGROUND
Evergreen Real Estate is a developer of multi-family housing projects and currently owns and
operates what was formerly known as the Mill Apartments. The firm is interested in the
acquisition and renovation of the 125-unit Buena Vista Townhome Complex in Elgin. The total
project cost is estimated at $8.5 million. The Illinois Housing Development Authority has
agreed to serve as issuer of the debt for the project. In addition to the acquisition cost for the
unit, renovation costs in the amount of $1.2 million are included in the project cost. Items
included for renovation are: window replacement, exterior siding, bathrooms, kitchens,
appliances, carpet, tile, electrical, paint, HVAC Systems and other miscellaneous repairs.
A similar purchase and renovation project occurred in 2004 for the apartment portion of the
Buena Vista complex and the City assisted in a similar fashion by earmarking a portion of the
IRB authority for the project.
The City annually receives an allocation of Industrial Revenue Bond capacity (2006 =
$7,830,880). The City recently allocated $1.75M in IRB capacity to Nelson Graphic Screen
Printing.
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•
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Transfer of Industrial Revenue Volume Cap to the Illinois Housing Development Authority
November 3, 2006
Page 2
COMMUNITY GROUPS/INTERESTED PERSONS CONTACTED
None
FINANCIAL IMPACT
There is no cost associated with the transfer of the volume cap to the Illinois Housing
Development Authority. Sufficient funds are remaining in the City's IRB Volume Cap
($6,070,880)to assist with the funding for this project.
GAL IMPACT
An ordinance transferring the City's IRB Volume Cap to the Illinois Housing Development
Authority is required.
ALTERNATIVES
1. Authorize the transfer of the Volume Cap to the Illinois Housing Development Authority
for the project is required.
2. Choose not to authorize the Volume Cap transfer.
Respectfully for Council consideration
RHM/jr
Attachment
10/12/2006 10:20 FAX 312 382 3250 JEFFREY C. RAPPIN 2 002/005
ArEVERGREEN
k Real Estate Services, L.L.C.
566 Wesl Lake Street,Suite 400 Phone: 312-234-9400
Chicago,IL 6066 1-1 41 4 Fax: 312-382-3220
October 12, 2006
VIA FACSIMILE
(847-931-5610)
Ray Moller
Director of Economic Development
City of Elgin
150 Dexter Court
Elgin, Illinois 60120-5555
Re: Buena Vista Townhomes, Elgin, Illinois
Dear Mr. Moller:
An affiliate of Evergreen Real Estate Services, LLC has entered into a contract to
acquire an affordable multifamily housing project commonly known as Buena Vista
Townhomes in Elgin. The development, is a 125-unit apartment complex, which serves
the need for affordable family housing in and around Elgin and will create ten
construction draws primarily drawn from the immediate area. Renovations in excess of
$1,200,000 dollars are expected to be made to the property. The development is adjacent
to Buena Vista Apartments for which you provided assistance in 2004.
We are requesting that the city support the acquisition and renovation of the
property through a commitment of the remaining portion of the City's 2006 volume cap
to assist in the financing. Our understanding is that the remaining volume cap is
'?`) ggG1-3-,t25;48-80. The new owner intends to raise approximately $8,500,000 of private activity
bonding authority and equity to finance the acquisition of the property and the cost of
renovation. The Illinois Housing Development Authority has agreed to serve as issuer
for the debt for the developer. It would be extremely helpful if the remaining balance
could be transferred to IHDA for the developer. We understand that the balance was
previously transferred to the Governor's office but we are hopeful that the Governor's
office will allow it to be transferred back.
Enclosed is a Form of Ordinance which will allow the City to reserve the
remaining portion of the 2006 volume cap and transfer that portion to IHDA for the
development.
Illinois: Rockford,Elgin,Joliet North Carolina: Ashville
Indiana: Mishawaka Tennesee: Knoxville
Missouri:Kansas City Kansas: Olathe
10/12/2006 10:20 FAX 312 382 3250 JEFFREY C. RAPPIN 1j003/005
Should you or your staff have any questions please feel free to call me.
Very truly yours,
Evergreen Real Estate Services, LLC
By:
f C. Rap hairman
JCR/It
cc: Mary Kenney
Mike Juozaitis