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HomeMy WebLinkAbout2023-455 Revenue Bond financing Community ChurchMEMORANDUM OF AGREEMENT THIS MEMORANDUM OF AGREEMENT (the "Agreement") is between the CITY OF OSHI{OSH, WISCONSIN (the `Issuer") and the commuNiTY eHuRCH, a religious society organized under Chapter 187 of the Wisconsin Statutes (the "Borrower"), and affiliated with Converge and Converge Great Lakes (formerly known as the Baptist General Conference and the Great Lakes Baptist Conference). 1. Preliminary Statement. Among the matters of mutual inducement which have resulted in this Agreement are the following: (a) The Borrower wishes to finance all or a portion of the costs of the project more completely described in the Issuer's Resolution No. 2023- 15S (the "Resolution"), to be located in the City of Oshkosh, Wisconsin and to be owned and operated by the Borrower or its affiliate or its designee (the "Project"), The Borrower requests that the Issuer issue its revenue bonds in an aggregate principal amount not to exceed $2,500,000 (the `Bonds'), to finance all or a portion of the costs of the Project pursuant to the provisions of the laws of the State of Wisconsin and the Internal Revenue Code of 1986, as amended (the "Code "). (b) The Bonds shall be special, limited obligations of the Issuer payable solely and only out of the revenues and receipts and other amounts received by or on behalf of the Issuer, pursuant to a loan agreement, lease agreement or other financing agreement between the Issuer and the Borrower or its affiliate or designee. The Bonds and the interest thereon shall not constitute an indebtedness or a loan of credit of the Issuer, the State of Wisconsin or any political subdivision thereof, within the meaning of any constitutional or statutory provisions, and no owner or holder of any such revenue bonds shall have the right to compel any exercise of the taxing power of the Issuer, the State of Wisconsin or any political subdivision thereof to pay the principal of, premium, if any, or interest on the Bonds. (c) Subject to due compliance with all requirements of law and the provisions set forth in the Initial Resolution, the Issuer, by virtue of such authority as may now or hereafter be conferred, subject to the holding a public hearing on the financing of the Project through the issuance of the Bonds and matters disclosed at said public hearing, and subject to receipt of adequate assurance from the Borrower or its affiliate or designee that there are one or more purchasers for the Bonds, will issue and sell the Bonds in an aggregate principal amount not to exceed a total of $2,500,000, to pay all or a portion of the costs of the Project. 2, Undertakings on the Part of the Issuer. Subject to the conditions above stated, the Issuer hereby agrees as follows: (a) Upon final determination of the details of the financing and provided that, on or before December 1, 2023, the Issuer and the Borrower shall have agreed to mutually acceptable terms for the Bonds and the contracts, agreement and proceedings related thereto, including but not limited to an agreement for the sale of the Bonds, the HB: 4868-1425-5226.1 Issuer will use all reasonable efforts to take the further steps necessary to authorize the issuance and sale of the Bonds in an amount not to exceed an aggregate principal amount Of $2,500,000, pursuant to the laws of the State of Wisconsin as then in effect. (b) It will enter into a loan agreement, lease agreement or other financing agreement with the Borrower or its affiliate or designee, whereby the Borrower or its affiliate or designee will pay to, or on behalf of, the Issuer such stuns as shall be sufficient to pay when due the principal of and interest and redemption premium, if any, on the Bonds as and when the same shall become due and payable. (e) It will take such further action and adopt such further proceedings as may be required to implement the aforesaid undertakings or as it may deem appropriate in pursuance thereof. 3. Undertakings on the Part of the Borrower. Subject to the conditions above stated, the Borrower hereby agrees as follows: (a) It will use all reasonable efforts to find one or more purchasers for the total amount of Bonds prior to requesting any further approval by the Issuer for such issue. (b) Contemporaneously with the delivery of the Bonds it or its affiliate or designee will enter into a loan agreement, lease agreement or other financing agreement or such other instrument, with the Issuer, under the terms of which the Borrower or its affiliate or designee will obligate itself to pay to or on behalf of 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. Such loan agreement, lease agreement or other financing agreement shall specifically obligate the Borrower or such affiliate or designee to implement a post -issuance federal tax compliance policy and to hire an outside consultant for periodic arbitrage rebate calculations, in order to maintain the tax-exempt status of interest on the Bonds. (c) It, or its affiliate or designee, will pay all fees, costs and expenses related to the issuance of the Bonds and will pay directly to the Issuer the Issuer's fees and expenses (including, without limitation the fees and expenses of its counsel) in connection with the issuance of the Bonds. (d) It will take such further action and adopt such fiirther proceedings as may be required to implement the aforesaid undertakings or as it may deem appropriate in pursuance thereof. 4. General Provisions. (a) All commitments of the Issuer under paragraph 2 hereof and of the Borrower under paragraph 3 hereof are subject to the conditions that on or before December 1, 2023 (or such other date as shall be mutually satisfactory to the Issuer and the Borrower), the Issuer and the Borrower shall have agreed to mutually acceptable terms and conditions of the loan agreement, lease agreement or other financing agreement or other -2- HB; 4868-t425-5226.1 instrument referred to in paragraphs 2 and 3 above and of the Bonds and other instruments or proceedings relating to the Bonds. (b) If the events set forth in (a) of this paragraph do not take place within the time set forth or any extension thereof and the Bonds in an amount of approximately 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 and its special counsel may incur at the request of the Borrower 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 wHEIZEOF, the parties hereto have entered into this agreement by their officers thereunto duly authorized as of the 12th day of September 2023. CITY OF OSHKOSH, WISCONSIN By ark A. Rohloff, City Manager ATTEST; c Diane Bartle t, City Clerk I Lorenson, et Attorney COMMUNITY CHURCH By It� W -3- HB: 4868-1425-5226.1 CITY COUNCIL OF CITY OF OSHKOSH, WISCONSIN RESOLUTION NO. 2023 - 455 INITIAL RESOLUTION REGARDING REVENUE BOND FINANCING FOR COMMUNITY CHURCH LOCATED AT 2351 RYF ROAD WHEREAS, Section 66.1103 of the Wisconsin Statutes (the "Act") authorizes the City of Oshkosh, Wisconsin (the "Issuer"), to authorize the issuance and sale of bonds by the Issuer to construct, equip, re- equip, acquire by gift, lease or purchase, install, reconstruct, rebuild, rehabilitate, improve, supplement, replace, maintain, repair, enlarge, extend or remodel industrial projects; and WHEREAS, Community Church, a religious society organized under Chapter 187 of the Wisconsin Statutes (the `Borrower") and affiliated with Converge and Converge Great Lakes (formerly known as the Baptist General Conference and the Great Lakes Baptist Conference), desires to complete a project to be owned by the Borrower consisting of financing only those portions of an expansion and certain improvements to the Borrower's facility located at 2351 Ryf Road in the City of Oshkosh, Wisconsin (the "Facility") which do not involve any worship or religious training and include only the community social portions of the project, including (i) expansion of the lobby/gathering area, (ii) remodel of student lounge, gatherings space and bathrooms, and (iii) payment of professional fees (collectively, the "Project"), all of which will advance the Borrower's exempt purpose, and would contribute to the well- being of the City of Oshkosh, Wisconsin; and WHEREAS, the cost of the Project to be financed with bonds is presently estimated not to exceed $2,500,000 and the amount proposed to be financed with one or more issues or series of tax-exempt and/or taxable revenue bonds (the `Bonds") issued under the Act does not exceed $2,500,000; and WHEREAS, it is the public interest of the Issuer to promote, attract, stimulate, rehabilitate and revitalize commerce, industry and manufacturing, to promote the betterment of the economy of the Issuer; and WHEREAS, the Borrower has requested that the Issuer now approve an initial resolution (the "Initial Resolution") providing for the financing of the Project in an amount not to exceed $2,500,000; and WHEREAS, the Issuer is a municipality organized and existing under and pursuant to the laws of the State of Wisconsin, and is authorized to enter into revenue agreements with eligible participants to issue revenue bonds with respect to the Project whereby eligible participants agree to cause said Project to be constructed and to pay the Issuer an amount of funds sufficient to provide for the prompt payment when due of the principal and interest on said revenue bonds; and WHEREAS, the Issuer and Borrower will enter into a Memorandum of Agreement under the terms of which the Issuer agrees, subject to the provisions of the Memorandum of Agreement, to issue its revenue bonds to provide financing of all or a portion of the costs of the Project. HB: 4884-6222-8345.2 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Oshkosh, Wisconsin, as follows: 1. The form, terms and provisions of the Memorandum of Agreement attached hereto as Exhibit A are hereby approved. The City Manager of the Issuer is hereby authorized to execute, and the City Clerk of the Issuer is hereby authorized to attest and to affix the official seal of the Issuer to, and to deliver a Memorandum of Agreement with the Borrower in substantially the same form as the attached Memorandum of Agreement, any changes in the execution copy being approved by their signatures, which Memorandum of Agreement is hereby made a part of this Initial Resolution. 2. Based upon representations of the Borrower, it is the finding and determination of the City Council that the Project is a qualified "project" within the meaning of Section 66.1103(2)(k)(20) of the Act and that the Borrower is an "eligible participant" within the meaning of the Act. The Issuer intends to: (a) Finance the Project in an amount not to exceed $2,500,000; and (b) Issue revenue bonds in one or more series of tax-exempt and/or taxable revenue bonds (the `Bond(s)"), in an amount not to exceed $2,500,000 in order to finance costs of the Project, upon the terms and conditions set forth in the Memorandum of Agreement. The aforesaid plan of financing contemplates, and is conditioned upon, the following: (a) The Bonds shall never constitute an indebtedness of the Issuer within the meaning of any state constitutional provision or statutory limitation; (b) The Bonds shall not constitute or give rise to a pecuniary liability of the Issuer or a charge against its general credit or taxing powers, including but not limited to: 1. Liability for failure to investigate or negligence in the investigation of the financial position or prospects of the Borrower, a user of the Project or any other person or for failure to consider, or negligence concerning, the adequacy of terms of, or collateral security for, the Bonds or any related agreement to protect interests of holders of the Bonds; and 2. Any liability in connection with the issuance or sale of the Bonds, for representations made, or for the performance of the obligation of any person who is a party to a related transaction or agreement except as specifically provided in the Act or by an express provision of the Bonds or a related written agreement to which the Issuer is a party; (c) The Project shall be subject to property taxation as contemplated by the Act in the same amount and to the same extent as though the Project were not financed with revenue bonds; (d) The Project falls under the community services portion of the land use table of the City's Comprehensive Plan; (e) The Borrower shall find a purchaser for all of the Bonds; (0 The City's out-of-pocket costs, including but not limited to legal fees and Trustee's fees, in connection with the issuance and sale of the Bonds shall be paid by the Borrower; and 2 HB: 4884-6222-8345.2 (g) A notice of public hearing required by federal law for purposes of Section 147(f) of the Internal Revenue Code, as amended, shall be published in a newspaper of general circulation in the City of Oshkosh and a public hearing shall be held to provide interested individuals or parties the opportunity to testify as to the Project and the issuance of the Bonds. 4. The aforesaid plan of financing shall not be legally binding upon the Issuer nor be finally implemented unless and until: (a) The terms and provisions of the same are authorized and approved by a further resolution of the City Council which shall be solely within the discretion of the City Council; (b) The City Clerk shall cause notice of adoption of this Initial Resolution, in the form attached hereto as Exhibit B, to be published once in a newspaper of general circulation in the City of Oshkosh, and the electors of the City of Oshkosh shall have been given the opportunity to petition for a referendum on the matter of the aforesaid Bond issue, all as required by law; (c) Either no such petition shall be timely filed or such petition shall have been filed and said referendum shall have approved the Bond issue; (d) The City Clerk shall have received an employment impact estimate issued under Section 238.11 of the Wisconsin Statutes; (e) All documents required to consummate the financing have been duly authorized and delivered; (f) The Issuer and the Borrower have resolved all land use and special use issues with respect to the affected property and the Project; and (g) All provisions of the Act shall have been satisfied. 5. Pursuant to the Act, all requirements that the Project be subject to the contracting requirements contained in Section 66.1103 are waived, the Borrower having represented that it is able to negotiate satisfactory arrangements for completing the Project and that the Issuer's interests are not prejudiced thereby. 6. The City Clerk is directed, following adoption of this Initial Resolution (i) to publish notice of such adoption not less than one time in the official newspaper of the City of Oshkosh, Wisconsin, such notice to be in substantially the form attached hereto as Exhibit B and (ii) to file a copy of this Initial Resolution, together with a statement indicating the date the Notice to Electors was published, with the Wisconsin Economic Development Corporation within twenty (20) days following the date of publication of such notice. 7. This Initial Resolution is an "initial resolution" within the meaning of the Act and official action toward issuance of the Bonds for purposes of Sections 103 and 144 of the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder. Furthermore, it is the reasonable expectation of the Issuer, based on information provided by the Borrower, that proceeds of the Bonds may be used to reimburse expenditures made on the Project prior to the issuance of the Bonds. The maximum principal amount of debt expected to be issued for the Project on the date hereof is $2,500,000. This statement of official intent is made pursuant to Treasury Regulations §1.150-2. 3 HB: 4884-6222-8345.2 Passed and adopted at a regular meeting of the City Council of the City of Oshkosh, Wisconsin this 12th day of September, 2023. APPROVED: Matt lvlugera r, Mayor ATTEST: Diane Bartlett, City Clerk 4 HB:4884-6222-s3as.2 EXHIBIT A NIEMORANDUM OF AGREEMENT [TO BE ATTACHED] HB:4884-6222-8345.2 EXHIBIT B NOTICE TO ELECTORS OF THE CITY OF OSHKOSH, WISCONSIN TAKE NOTICE that the City Council of the City of Oshkosh, Wisconsin (the "Issuer"), at a regular meeting held at City Hall, 215 Church Avenue, Oshkosh, Wisconsin, on September 12, 2023, adopted an Initial Resolution pursuant to Section 66.1103 of the Wisconsin Statutes, as amended, expressing the intention to issue not to exceed $2,500,000 of revenue bonds of the Issuer (the "Bonds") on behalf of Community Church, a religious society organized under Chapter 187 of the Wisconsin Statutes (the "Borrower"). The Borrower desires to complete a project consisting of financing only those portions of an expansion and certain improvements to the Borrower's facility located at 2351 Ryf Road in the City of Oshkosh, Wisconsin (the "Facility") which do not involve any worship or religious training and include only the community social portions of the project, including (i) expansion of the lobby/gathering area, (ii) remodel of student lounge, gatherings space and bathrooms, and (iii) payment of professional fees (collectively, the "Project"), all of which will advance the Borrower's exempt purpose. The Borrower has represented that the net number of full-time equivalent jobs which the Project is expected to maintain on the Project site is 1. Pursuant to the terms of Section 66.1103 of the Wisconsin Statutes, all requirements that the Project be subject to the contracting requirements contained in Section 66.1103 are waived, the Borrower having represented that it is able to negotiate satisfactory arrangements for completing the Project and that the Issuer's interests are not prejudiced thereby. THE BONDS SHALL NEVER CONSTITUTE AN INDEBTEDNESS OF THE ISSUER, NOR SHALL THE BONDS GIVE RISE TO ANY PECUNIARY LIABILITY OF THE ISSUER, NOR SHALL THE BONDS BE A CHARGE AGAINST THE GENERAL CREDIT OR TAXING POWERS OF THE ISSUER. RATHER, THE BONDS SHALL BE PAYABLE SOLELY FROM THE REVENUES AND OTHER AMOUNTS TO BE DERIVED PURSUANT TO THE REVENUE AGREEMENT RELATING TO SAID PROJECT TO BE ENTERED INTO BETWEEN THE ISSUER AND THE BORROWER. The Initial Resolution may be inspected in the office of the City Clerk at 215 Church Avenue, Oshkosh, Wisconsin, during business hours. TAKE FURTHER NOTICE THAT THE ELECTORS OF THE CITY OF OSHKOSH MAY PETITION FOR A REFERENDUM ON THE QUESTION OF THE BOND ISSUE. Unless within thirty (30) days from the date of the publication of this Notice a petition signed by not less than five percent (50/6) of the registered electors of the City of Oshkosh is filed with the City Clerk requesting a referendum on the question of the issuance of the Bonds, the Issuer will issue the Bonds without submitting the proposition for the electors' approval. If such petition is filed as aforesaid, then the Bonds shall not be issued until approved by a majority of the electors of the City of Oshkosh voting thereon at a general or special election. Diane Bartlett, City Clerk City of Oshkosh, Wisconsin HB: 4884-6222-8345.2 CERTIFICATION BY CITY CLERK I, Diane Bartlett, duly sworn, hereby certify that I am the duly qualified and acting City Clerk of the City of Oshkosh, Wisconsin (the "City"), and as such I have in my possession, or have access to, the complete corporate records of the City and of its City Council; that I have carefully compared the transcript attached hereto with the aforesaid records; and that said transcript attached hereto is a true, correct and complete copy of all the records in relation to the adoption of Resolution No. 23-455 entitled: INITIAL RESOLUTION REGARDING REVENUE BOND FINANCING FOR COMMUNITY CHURCH LOCATED AT 2351 RYF ROAD I hereby further certify as follows: 1. Said Initial Resolution was considered for adoption by the City Council at a meeting held at City Hall, 215 Church Avenue, Oshkosh, Wisconsin, at 6:00 p.m. on September 12, 2023. Said meeting was a regular meeting of the City Council and was held in open session. 2. Said Initial Resolution was on the agenda for said meeting and public notice thereof was given not less than twenty-four (24) hours prior to the commencement of said meeting in compliance with Section 19.84 of the Wisconsin Statutes, including, without limitation, by posting on the bulletin board in the City Hall, by notice to those news media who have filed a written request for notice of meetings, and by notice to the official newspaper of the City. 3. Said meeting was called to order by Mayor Matt Mugerauer, who chaired the meeting. Upon roll, I noted and recorded that the following council members were present: Joe Stephenson Karl Buelow LaKeisha Haase Paul Esslinger Lynnsey Erickson Mike Ford Matt Mugerauer, Mayor I noted and recorded that a quorum was present. Various matters and business were taken up during the course of the meeting without intervention of any closed session. One of the matters taken up was said Initial Resolution, which was introduced, and adopted with consent agenda items. Following discussion and after all council members who desired to do so had expressed their views for or against said Initial Resolution, the question was called, and upon roll being called and the continued presence of a quorum being noted, the resolution was carried unanimously (7-0) Whereupon said Initial Resolution being declared adopted, and I so recorded it. IN WITNESS WHEREOF, I have signed my name and affixed the seal of the City hereto on this 12th day of September, 2023. ••' e e •• [SEAT ] �. f • Diane Bartlett, City Clerk ZZ HB: 4884-6222-8345.2