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HomeMy WebLinkAboutS8-85 ORDINANCE NO. S8-85 AN ORDINANCE ACCEPTING THE ALLOCATION OF APPROXIMATELY $885,000 IN INDUSTRIAL REVENUE BOND AUTHORITY FROM THE VILLAGE OF STICSNEY, ILLINOIS WHEREAS, the City of Elgin, as a home rule municipality is authorized by law to issue Industrial Revenue Bonds; and WHEREAS, the amount of Industrial Revenue Bonds to be issued is regulated by law in a manner which restricts said issuance in an amount equal to One Hundred Fifty and no/100ths Dollars ($150.00) per capita per year; and WHEREAS, the City of Elgin may, by action of its corporate authorities, accept a reallocation of the authority of another home rule municipality to issue said revenue bonds; and WHEREAS, the Village of Stickney has approximately $885,000 in unutilized bond authority; and WHEREAS, the City of Elgin desires to acquire from the Village of Stickney all of its unutilized bond authority for the purpose of loaning the proceeds of said funds to finance construction of a project authorized and eligible for financing of Industrial Revenue Bonds; and WHEREAS, the Village of Stickney will not utilize its entire authority to issue said revenue bonds in the total amount permitted by law; and • N November 19, 1985 MEMORANDUM TO: Mayor and Members of the City Council FROM: James J. Cook, City Manager SUBJECT: Transfer of Bond Allocation from Village of Stickney PURPOSE: Attached is a proposed ordinance accepting a transfer of a portion of the industrial revenue bond allocation of the Village of Stickney. BACKGROUND: Universal Chemicals has applied for the issuance of additional bonds in the amount of $1,500,000. The City of Elgin has exhausted all but $800,000 of its alloca- tion. Together with the transfer of allocation by the Village of Stickney of a portion of its allocation, the City will be able to issue bonds as requested. FINANCIAL IMPACT: All expenses of the issue will be borne by the application. RECOMMENDATION: Acceptance of the transfer is recommended. itqA y 'anage- Ltsmt' lb . ORDINANCE NO. AN ORDINANCE ACCEPTING THE ALLOCATION OF APPROXIMATELY $885,000 IN INDUSTRIAL REVENUE BOND AUTHORITY FROM THE VILLAGE OF STICHNEY, ILLINOIS WHEREAS, the City of Elgin, as a home rule municipality is authorized by law to issue Industrial Revenue Bonds; and WHEREAS, the amount of Industrial Revenue Bonds to be issued is regulated by law in a manner which restricts said issuance in an amount equal to One Hundred Fifty and no/100ths Dollars ($150.00) per capita per year; and WHEREAS, the City of Elgin may, by action of its corporate authorities, accept a reallocation of the authority of another home rule municipality to issue said revenue bonds; and WHEREAS, the Village of Stickney has approximately $885,000 in unutilized bond authority; and WHEREAS, the City of Elgin desires to acquire from the Village of Stickney all of its unutilized bond authority for the purpose of loaning the proceeds of said funds to finance construction of a project authorized and eligible for financing of Industrial Revenue Bonds; and WHEREAS, the Village of Stickney will not utilize its entire authority to issue said revenue bonds in the total amount permitted by law; and WHEREAS, the Village of Stickney by its Ordinance No. entitled "An Ordinance Allocating Approximately $885,000 In Industrial Revenue Bond Authority to the City of Elgin, Illinois," adopted on November 19, 1985, made such reallocation to the City of Elgin, Illinois; NOW, THEREFORE, be it ordained by the Mayor and City Council of the City of Elgin, Illinois as follows: SECTION 1. The facts stated in the Preamble to this Ordinance are found to be true and correct. SECTION 2. The City of Elgin hereby accepts the Village of Stickney's allocation to the City of Elgin of its authority to issue $885,000 in Industrial Revenue Bonds; said acceptance of said allocation being authorized and subject to the applicable statutes in said cases made and provided. SECTION 3. This Ordinance shall be in full force and effect from and after its passage and approval in the manner provided by law. PASSED this day of November, 1985. APPROVED this day of November, 1985 Richard L. Verbic, Mayor ATTEST: Marie Yearman, City Clerk AYES: NAYS: ABSENT: - 2 - Eip,• 28 North Grove Avenue, P.O. Box 648 AREA Elgin, Illinois 60120 - Area Code (312) 741-5660 CHAMBER OF COMMERCE November 19, 1985 James J. Cook City Manager City of Elgin 150 Dexter Court Elgin, IL 60120 Dear Jim: The Elgin Economic Development Commission, at its November 15 meeting, approved the Industrial Revenue Bond application of the Universal Chemical 's project in the amount of $1,500,000. Inasmuch as the City of Elgin, with approval of this application, will have committed $10,250,000 of eco- nomic development bonds above a total cap of $9,550,000, the commission's approval is subject to the City of Elgin securing an intergovernmental agreement with the Village of Stickney to cover the excess amount of approximately $700,000. Sincerely, M. Edward Kelly, CCE Executive Vice President Vice President nd S November 19, 1985 MEMORANDUM TO: Mayor and Members of the City Council FROM: James J. Cook, City Manager SUBJECT: Resolution Authorizing Memorandum of Agreement for Issuance of Industrial Revenue Bonds--Universal Chemicals Project PURPOSE: Attached is a resolution authorizing a memorandum of agreement with Universal Chemicals for the issuance of an additional $1,500,000 of industrial revenue bonds. BACKGROUND: Universal Chemicals has applied for the issuance of an additional 51,500,000 in revenue bonds to complete their project for which bonds have previously been issued. The Village of Stickney has transferred $885,000 of its authority which combined with the remainder of the City of Elgin's allocation is sufficient to meet the applicant's request. The purchaser is the holder of the previously issued bonds. The Economic Development Commission has recommended approval. FINANCIAL IMPACT: As the bonds are payable solely out of the project revenues and all expenses are borne by the applicant, there is no direct financial impact to the City. RECOMMENDATION: Passage of the resolution is recommended. r1 /(111'11 i y Manag r/ tettak_./ . CTH-10001:111885 RESOLUTION AUTHORIZING THE EXECUTION OF A MEMORANDUM OF AGREEMENT (UNIVERSAL CHEMICAL AND COATINGS,INC. PROJECT) WHEREAS, Universal Chemicals and Coatings, Inc., a Delaware corporation (the "Borrower") wishes to finance the construction of an industrial facility and wishes to have the City of Elgin, Illinois (the "Issuer") issue its revenue bonds to finance such construction; and WHEREAS, a Memorandum of Agreement has been presented to the Issuer under the terms of which the Issuer agrees, subject to the provisions of such Agreement, to issue its revenue bonds to finance such construction. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN, ILLINOIS: Section 1. That the Mayor of the Issuer is hereby authorized to execute, and the Clerk of the Issuer is hereby authorized to attest a Memorandum of Agreement with the Borrower in substantially the form of such Agreement appended to this Resolution as Exhibit A. Section 2. That the officers and employees of the Issuer are hereby authorized to take such further action as is necessary to carry out the intent and purposes of the Memorandum of Agreement as executed and to issue not to exceed $1,500,000 of its revenue bonds upon the terms and conditions stated in such Memorandum of Agreement for the purpose of defraying the cost of constructing the Project (as defined in the Memorandum o` Agreement) and that the same is declared to be for a public purpose and to be a matter ;,ertaining to the government and affairs of the Issuer. Section 3. That this resolution shall be in full force and effect upon its passage and approval. Richard L. Verbic, Mayor Presented: Adopted: Vote: Yes Recorded: Attest: Marie Yearman, City Clerk CTH-10002:111885 MEMORANDUM OF AGREEMENT THIS MEMORANDUM OF AGREEMENT is between the City of Elgin, Illinois (the "Issuer") and Universal Chemical and Coatings, Inc., a Delaware corporation (the "Borrower"). 1. Preliminary Statement. Among the matters of mutual inducement which have resulted in this Agreement are the following: (a) The Issuer is a home rule unit of local government and is authorized under its home rule powers as set forth in the 1970 Constitution of the State of Illinois, Article VII, Section 6 and the provisions of an Ordinance adopted on February 13, 1980, as supplemented and amended (the "Ordinance") to issue economic development revenue bonds for the purpose of financing, in whole or in part, the cost of the construction, acquisition, purchase, reconstruction, improvement, betterment or extension of any economic development project and to enter into a loan agreement with the Borrower pursuant to which the proceeds of such revenue bonds may be loaned to the Borrower or its designee to finance the costs of the construction of such project. (b) The Borrower wishes to obtain satisfactory assurance from the Issuer that the proceeds of the sale of the revenue bonds of the Issuer will be made available to it or its designee to finance the costs of construction and equipping of an industrial facility to be located on the south side of Fox Lane approximately 1000 ft. west of North McLean Boulevard, within the territorial boundaries of the Issuer (the "Project"). (c) Subject to the conditions contained herein and to the due compliance with all requirements of law, the Issuer, by virtue of the provisions of the Ordinance, will issue and sell its revenue bonds in an amount not to exceed $1,500,000 (the "Bonds") to finance the costs of the Project. 2. Undertakings on the Part of the Issuer. Subject to the conditions above stated, the Issuer agrees as follows: (a) That it will authorize the issuance and sale of the Bonds under the provisions of the Ordinance. (b) That it will, at the proper time and subject in all respects to the prior advice, consent and approval of the Borrower, adopt, or cause to be adopted, such proceedings and authorize the execution of such documents as may be necessary and advisable for the authorization, issuance, and sale of the Bonds, and that it will enter into a loan agreement whereby the Borrower or its designee will pay to or on behalf of the Issuer such sums as shall be sufficient to pay the principal and interest and redemption premium, if any, on the Bonds as and when the same shall become due and payable. 3. Undertakings on the Part of the Borrower. Subject to the conditions above stated, the Borrower agrees as follows: (a) That it will use all reasonable efforts to find one or more purchasers for the Bonds. (b) That contemporaneously with the delivery of the Bonds, it or its designee, will enter into a loan agreement with the Issuer under the terms of which the Borrower or its designee will obligate itself to pay to the Issuer sums sufficient in the aggregate to pay the principal of and interest and redemption premium, if any, on the Bonds as and when the same shall become due and payable. 4. General Provisions. (a) All commitments of the Issuer under Paragraph 2 hereof and of the Borrower or its designee under Paragraph 3 hereof are subject to the condition that on or before December 31, 1985 (or such other date as shall be mutually satisfactory to the Issuer and the Borrower), the Issuer and the Borrower or its designee shall have agreed to mutually acceptable terms and conditions of the loan agreement and of the Bonds and other instruments or proceedings relating to the Bonds and the Bonds shall have been issued. The decision not to approve or agree to any term or condition of any document or not to take any action prior to issuance of the Bonds shall rest solely within the complete discretion of the parties to this Agreement. (b) If the events set forth in (a) of this Paragraph 4 do not take place within the time set forth or any extension thereof and the Bonds in an amount not exceeding the amount stated above are not sold within such time, the Borrower agrees that it will reimburse the Issuer for all reasonable and necessary direct out-of-pocket expenses which the Issuer may incur at the Borrower's or the Borrower's designee's request or as a result of arising out of the passage of this Resolution including but not limited to the payment of attorney and other consultant fees arising from the execution of this Agreement and the performance by the Issuer of its obligations hereunder, and this Agreement shall thereupon terminate. • IN WITNESS WHEREOF, the parties hereto have entered into this Agreement by their officers thereunto duly authorized as of the day of , 1985. CITY OF ELGIN, ILLINOIS Mayor (SEAL) ATTEST: City Clerk UNIVERSAL CHEMICAL AND COATINGS, INC. By Its (SEAL) ATTEST: Its UNIVERSAL CHEMICALS Li COATINGS. INC. 1124 ELMHURST ROAD. ELK GROVE VILLAGE. ILLINOIS 60007 U.S.A. Tel [312) 297-2001 Cable UNICHEM TWX 910 233-2430 October 23,. 1985 Mr. Robert Malm City of Elgin 156 Dexter Court Elgin, IL 60120-5555 Re: Request for Industrial Revenue Bond Dear Mr. Maim: Universal Chemicals & Coatings, Inc. hereby requests favorable consideration by the City Council of Elgin to pass a resolution indicating its willingness to issue additional industrial revenue bonds to complete the expansion project of Universal in Elgin. It is anticipated that the project will require a bond of approxiiratel.y $1 ,500,000, the proceeds of which are to be used for cost overruns on the project as follows: Bldg. and Land Improvements $ 975,000 Equipment 450,000 Misc. attorney and bank fees 75 ,000 $1, 500,000 Enclosed is an updated copy of the material submitted when we originally applied for funds for this project. The only changes appear in Section I , paragraphs A and B. The • rest of the report remains unchanged from our original request. Thank you for your assistance in processing this application in a timely manner. If you have any questions concerning it, please let us know. Sincerely, y�r� LUo1 ru_ c�• v+ IC Wayne)) F. McWhorter Vice President Encl . UNICHEM INDUSTRIAL DEVELOPMENT BOND REQUEST REVIEW CHECK SHEET Name of Applicant: Universal Chemicals & Coatings Date of Application: November 13, 1985 Amount Requested: $1 ,500,000 Criteria for Approval : Number of additional jobs: 60+ Increased tax revenue: Yes Firm commitment to finance project: Yes Name of bond purchaser: American National Bank Bond counsel hired: Yes Bond issue checklist complied with: Non-refundable deposit made: Yes Community Development Department submitted review: Yes An original bond application for $4,000,000 was approved by the City of Elgin. The $1 ,500,000 is to finance cost overruns. Elgin Economic Development Commission recommendation: ELGIN ECONOMIC DEVELOPMENT COMMISSION Friday, November 15, 1985 Home Federal Savings of Elgin 1. MINUTES OF PREVIOUS MEETING 2. UNIVERSAL CHEMICALS & COATING, INC. IDB APPLICATION 3. MISSION DEVELOPMENT COMMITTEE REPORT 4. CITY OF ELGIN 5. OTHER BUSINESS 6. ADJOURNMENT ELGIN ECONOMIC DEVELOPMENT COMMISSION Key Objective: To expand employment opportunities in the City of Elgin and its immediate surrounding area by: 2 4) Influencing the influx of new business and industry it) Influencing the expansion and redevelopment of existing business and industry. Key Standards: To influence the creation of 600 jobs per year to come from 80% expansion and 20% new firms , which has an annual economic impact of $2,100,000 in additional payrolls, and $5,880,000 in additional spending. (Note - the last statements allude to the quality of the jobs being created 2,100,000 _ $3,500/year/job 600 5,800,000 _ $9,800/year/job ) 600 Critical Objectives: 1 ) Establish/update concise written goals concerning the size, type, and mixture of business and industry to be sought. 2) Develop/review plans to actively recruit desired firms to Elgin and its area. This may take the form of: a) Bulk mailings b) Telephone surveys c) Advertising Campaigns d) Etc. 3) Maintain close contact with existing firms in order to a) Encourage in-place expansion b) Identify existing or perceived roadblocks to a good business climate c) Assist existing firms in solving existing problems 4) Inform appropriate agencies of deficiences which inhibit economic growth, such as: a) Poor reputation or low opinion of certain areas b) City laws or ordinances inhibiting business growth c) Inadequate physical requirements such as: (1 ) Land for development (2) Housing, schools, churches for employees • (3) Inventory of vacant structures (4) Infrastructure or utilities d) Lack of entertainment or cultural opportunities 5) Coordinate the individual Economic Development endeavors of member firms into a cohesive strategy. Elgin Economic Development Commission Page 2 ' 6) Work with city staff/elected officials to develop an integrated capital development budget and necessary city services to complement economic development goals. 7) Work with city staff/elected officials 1 ) to identify blighted business/industrial areas 2) to develop plan for revitalizing identified areas and 3) to attract viable private business/in- dustry to identified areas. APEIT 8) Work with appropriate agencies to develop marketable skilltr ining programs f rc-e--whose., Ieci - . - .. . - -