HomeMy WebLinkAboutO-1706ORDINANCE NO. 1706
BE IT ORDAINED by the City Council (herein called the
"Council") of the City of Fairhope (the "City"), in the State of Alabama, as follows:
Section 1. Findings. The Council has ascertained and does hereby
find and declare that the following facts are true and correct:
(a) The Fairhope Airport Authority (the "Authority") has
heretofore issued and delivered its $8 ,845 ,000 Airport Improvement Bonds, Series
2007 (the "Series 2007 Bonds"), the proceeds of which were used to pay the costs of
(i) acquiring two parcels of real property (the "Property") located around and
adjacent to the site of the existing operations of the municipal airport within the City
(the "Airport") for future expansion of the Airport including, but not limited to ,
extending the existing runway and/or constructing a new runway at the airport,
constructing a terminal facility , providing a noise reduction buffer area , and
constructing parking and general landscape improvements; (ii) constructing and
improving taxiways at the Airport; and (iii) refinancing a loan previously made to
construct and acquire hangars for general use by aircraft owners and operators (the
"2007 Improvements")
(b) In connection with the issuance of the Series 2007 Bonds the
Authority requested that the City assist the Authority in financing the 2007 Project
by entering into that certain Appropriation Agreement dated as of March 1, 2007 (the
"2007 Appropriation Agreement") pursuant to which the City agreed to appropriate
funds to the Authority on a limited, annual basis and in amounts referable to certain
payments and other costs owed by the Authority in connection with the Series 2007
Bonds.
(c) The Authority heretofore issued and delivered its $8,935 ,000
Airport Improvement Refunding Bond, Series 2010 (the "Series 2010 Bond") in
order to redeem and retire the Series 2007 Bonds , and in connection therewith the
City executed that certain Appropriation Agreement (the "2010 Appropriation
Agreement") pursuant to which the City agreed to appropriate funds to the Authority
on a limited, annual basis and in amounts referable to the debt service requirements
due under the Series 2010 Bond.
( d) The Series 2010 Bond bore interest at a variable rate , and in
light of the rising interest rate environment at the time the Authority issued its fixed
rate $7,445 ,639 Airport Improvement Refunding Bond, Series 2017 (the "Series
2017 Bond"), in order to redeem and retire the Series 2010 Bond, and in connection
therewith the City entered into a Funding Agreement (the "2017 Funding
Agreement") in order to provide the Authority funds equal to maturing installments
of debt service on the Series 2017 Bond.
( e) The Series 2017 Bond bears interest at rates significantly
higher than the current market interest rates and the Authority has determined to
issue and deliver its fixed rate $6 ,695 ,629 Airport Improvement _ Refunding Bond,
Series 2021 (the "Series 2021 Bond") in order to redeem and retire the Series 2017
Bond, and in connection therewith the Authority has requested that the City enter
into a Funding Agreement in order to provide the Authority funds equal to maturing
installments of debt service on the Series 2021 Bond.
(t) The operation and expansion of the Airport has facilitated
economic growth and development within the City.
Ordinance No. 1706
Page -2-
(g) The Authority is a "related public corporation" as that term is
defined in Chapter 63 of Title 11 of the Code of Alabama of 1975, as amended.
(h) In order to enable the improvement and expansion of the
Airport, the City Council hereby deems it necessary, desirable and in the public
interest that the City enter into the Appropriation Agreement, as further described
below.
Section 2 . Approval of Funding Agreement and Related Documents.
Pursuant the applicable provisions of the constitution and laws of Alabama,
including particularly Section 4-3-49 and Chapter 63 of Title 11 of the Code of
Alabama of 1975 , as amended, the Mayor and all other officers of the City are
hereby authorized and directed to execute, seal, attest and deliver on behalf of the
City the following :
(a) A Funding Agreement between the City and the Authority in
substantially the form presented to the meeting at which this Ordinance is adopted,
which form shall be attached as Exhibit A to the minutes of the meeting at which this
Ordinance is adopted and which is hereby adopted in all respects as if set out in full
in this Ordinance, with such minor changes as shall be approved by the Mayor,
which approval shall be conclusively evidenced by execution of the Funding
Agreement by the Mayor;
(b) Such other documents , instruments, and certificates and to
take such other actions on behalf of the City as may be necessary and appropriate in
connection with the sale by the Authority of the Series 2010 Bond.
Section 3 . Provisions of Ordinance Severable. The provisions of this
Ordinance are hereby declared to be severable in the event that any provision hereof
shall be held invalid by a court of competent jurisdiction; such invalidity shall not
affect any other portion of this Ordinance.
Adopted this 8th of March, 2021.
ATTEST:
6~
City Clerk
FUNDING AGREEMENT
betwee n
FAIRHOPE AIRPORT AUTHORITY
and
CITY OF FAIRHOPE, ALABAMA
$6 ,695 ,629
FAIRHOPE AIRPORT AUTHORITY
Airport Improvement Refunding Bond
Series 2021
$6 ,695,629
FAIRHOPE AIRPORT AUTHORITY
Airport Improvement Refunding Bond
Series 2021
FUNDING AGREEMENT dated March 16 , 2021, between the FAIRHO PE
AIRPORT AUTHORITY , a public corporation organized and existing under
the provisions of the laws of the State of Alabama (herein sometimes called the
"Authority"), and the CITY OF FAIRHOPE, ALABAMA (herein sometimes called
the "City").
RECITALS:
WHEREAS , the Authority has heretofore issued and delivered its
$8,845,000 Airport Improvement Bonds, Series 2007 (the "Series 2007 Bonds"), the
proceeds of which were used to pay the costs of (i) acquiring two parcels of real
property (the "Property") located around and adjacent to the site of the existing
operations of the municipal airport within the City (the "Airport") for future
expansion of the Airport including, but not limited to, extending the existing runway
and/or constructing a new runway at the airport, constructing a terminal
facility, providing a noise reduction buffer area, and constructing parking and general
landscape improvements; (ii) constructing and improving taxiways at the Airport;
and (iii) refinancing a loan previously made to construct and acquire hangars for
general use by aircraft owners and operators (the "Improvements"); and
WHEREAS, in connection with the issuance of the Series 2007 Bonds the Authority
requested that the City assist the Authority in acquiring the Property, refinancing
the Loan and acquiring and constructing the Improvements by entering into that
certain Appropriation Agreement dated as of March 1, 2007 (the "2007 Appropriation
Agreement") pursuant to which the City agreed to appropriate funds to the Authority
on a limited , annual basis and in amounts referable to certain payments and other
costs owed by the Authority to Allied Irish Banks p .l.c . in connection with the Series
2007 Bonds; and
WHEREAS, the Authority heretofore issued and delivered its $8,935,000
Airport Improvement Refunding Bond, Series 2010 (the "Series 2010 Bond") in order
to redeem and retire the Series 2007 Bonds, and in connection therewith the City
executed that certain Appropriation Agreement dated August 26, 2010 (the "2010
Appropriation Agreement") pursuant to which the City agreed to appropriate funds
to the Authority on a limited, annual basis and in amounts referable to the debt service
requirements due under the Series 2010 Bond; and
WHEREAS , the Series 2010 Bond bore interest at a variable rate , and in light of the
rising interest rate environment at the time the Authority issued its fixed rate
$7 ,445 ,639 Airport Improvement Refunding Bond , Series 2017 (the "Series 2017
Bond"), in order to redeem and retire the Series 2010 Bond, and in connection
therewith the City entered into a Funding Agreement (the "2017 Funding
Agreement") in order to provide the Authority funds equal to maturing installments
of debt service on the Series 2017 Bond; and
WHEREAS , the Series 2017 bears interest at rates significantly higher than the
current market interest rates and the Authority and the City have determined that
the Authority issue and deliver its fixed rate $6 ,695 ,629 Airport Improvement
Refunding Bond, Series 2021 (the "Series 2021 Bond") in order to redeem and retire
the Series 2017 Bond, and in connection therewith the Authority has requested that
the City enter into this Funding Agreement in order to provide the Authority
funds equal to maturing installments of debt service on the Series 2021 Bond ; and
WHEREAS , the operation and expansion of the Airport has facilitated
economic growth and development within the City , and the City has determined to
enter into this Funding Agreement with the Authority.
NOW THEREFORE, in consideration of the respective agreements on the part of
the Authority and the City herein contained , the Authority and the City do hereby
agree as follows:
Section 1. Funding Agreement Term. The Authority and the City hereby covenant
and agree that this Finding Agreement shall be in full force and effect from the date
of execution and delivery hereof through and including payment in full of the Series
2021 Bond.
Section 2. Payment Provisions . The City hereby covenants and agrees, on or before
the dates specified or otherwise referenced on Exhibit A , to pay to the Authority ,
in immediately available funds , an amount sufficient to enable the Authority to make
the payments of principal and interest with respect to the Series 2021 Bond as set forth
on Exhibit A hereto and made a part hereof as if set forth in full herein. By the
execution and delivery hereof, the City approves the terms and conditions of said
borrowing by the Authority. The obligation of the City to make the payments provided
for herein shall be absolute and unconditional , irrespective of any rights of set-off,
recoupment or counterclaim it might otherwise have against the Authority.
Section 3. General Obligation Pledge. The obligation on the part of the City to pay
the amounts required to be paid and to perform the agreements on the part of the
City herein required to be performed hereunder shall be a general obligation of the
City for which the City pledges its full faith and credit.
Se ctio n 4. A utho rity . This Funding Agreement is being entered into pursuant to
authority conferred upon the City by the Constitution and laws of the State
of Alabama, including, without limitation, Chapter 63 of Title 11 of the Code of
Alabama 1975 , as amended. The Authority agrees to comp ly with the provisions of
said Constitution and laws , including the provisions of the said Chapter 63 in the
receipt and application of amounts paid by the City to the Authority pursuant to the
provisions of this Funding Agreement.
Se ction 5. T hird Pa rty B eneficiari es; Ass ignm e nt. The holder of the Series 2021
Bond is hereby designated as a third-party beneficiary of this Funding Agreement.
This Funding Agreement and the Authority 's rights to receive amounts from the City
pursu ant to this Funding Agreement may be assigned and pledged by the Authority to
any holder of the Series 2021 Bond as security for the Series 2021 Bond. This Funding
Agreement shall not be assigned by the City, and any instrument purporting or
attempting to assign the interest of the City hereunder shall be void .
Se ction 6. City and H old e r Cons ent to A m endm ent of Series 2021 Bond . The
Authority hereby covenants and agrees that it shall not alter, amend or otherwise
modify the terms of the Series 2021 Bond without the prior written consent of the City
and the holder of the Series 2021 Bond, and any attempted alteration , amendment or
modification to the Series 2021 Bond for which each of the City and the holder of the
Series 2021 Bond has not provided its prior written consent sha ll be d eemed of no
force or effect.
Section 7. Te rmin ation of 201 7 F undin g Ag ree m ent. The City and the Authority
here by agree that upon the execution and delivery of this Funding Agreement and the
issuance and delivery of the Series 2021 Bond the 2017 Funding Agreement
shall terminate and be deemed null and void and of no further force or effect.
Section 8. B indin g E ffect. This Funding Agreement shall inure to the benefit of and
shall be binding u pon the Authority , the City and their respective successors and
assigns.
Se ction 9. Severabili ty. In the event that any provis ion of this Funding Agreement
shall be held invalid or unenforceab le by any court of com petent jurisdiction,
such provision shall be deemed and construed to be severable from the remaining
provisions of this Funding Agreement with the intended result that such holding shall
not invalidate or render unenforceable any other provisions of this Funding
Agreement.
Date
Loan 3/16/2021
1 5/1/2021
2 6/1/2021
3 7/1/2021
4 8/1/2021
5 9/1/2021
6 10/1/20 21
7 11/1/2021
8 12/1/2021
2021 Totals
9 1/1/2022
10 2/1/2022
11 3/1/2022
12 4/1/2022
13 5/1/2022
14 6/1/2022
15 7/1/2022
16 8/1/2022
17 9/1/2022
18 10/1/2022
19 11/1/2022
20 12/1/2022
2022 Tota ls
21 1/1/2023
22 2/1/2023
23 3/1/20 23
24 4/1/2023
25 5/1/2023
26 6/1/2023
27 7/1/2023
28 8/1/2023
29 9/1/2023
EXHIBIT A
to
FUNDING AGREEME NT
Debt Service Schedule
Payment Interest Principal
9,756.52 9,756.52 0 .00
6,360.85 6,360 .85 0 .00
6,360.85 6,360 .85 0 .00
6,360 .85 6,360 .85 0.00
231,360 .85 6,360.85 225,000.00
6,147.10 6,147.10 0 .00
6,147.10 6,147.10 0.00
6,147.10 6,147 .10 0 .00
278,641.22 53 ,641.22 225,000 .00
6,147.10 6,147.10 0 .00
6,147.10 6,147.10 0 .00
6,147 .10 6,147 .10 0 .00
6,147.10 6,147.10 0.00
6,147.10 6,147.10 0 .00
6,147 .10 6,147 .10 0 .00
6,147 .10 6,147 .10 0 .00
6,147 .10 6,147.10 0.00
256,147 .10 6,147.10 250,000 .00
5,909 .60 5,909.60 0.00
5,909 .60 5,909 .60 0.00
5,909 .60 5,909.60 0.00
323,052 .70 73,052.70 250,000.00
5,909 .60 5,909 .60 0 .00
5,909.60 5,909.60 0.00
5,909.60 5,909 .60 0.00
5,909.60 5,909 .60 0.00
5,909.60 5,909.60 0 .00
5,909 .60 5,909 .60 0 .00
5,909.60 5,909.60 0.00
5,909.60 5,909 .60 0 .00
255,909 .60 5,909 .60 250,000 .00
30 10/1/2023 5,672.10 5,672.10 0 .00
31 11/1/2023 5,672 .10 5 ,672 .10 0 .00
32 12/1/2023 5,672.10 5,672 .10 0 .00
2023 Totals 320,202 .70 70 ,202 .70 250,000 .00
33 1/1/2024 5 ,672 .10 5,672 .10 0 .00
34 2/1/2024 5 ,672 .10 5,672.10 0.00
35 3/1/2024 5,672 .10 5,672 .10 0 .00
36 4/1/2024 5,672 .10 5,672 .10 0 .00
37 5/1/2024 5,672.10 5,672.10 0 .00
38 6/1/2024 5,672 .10 5,672.10 0.00
39 7/1/2024 5,672 .10 5,672.10 0 .00
40 8/1/2024 5,672.10 5,672.10 0 .00
41 9/1/2024 280,672 .10 5,672 .10 275,000 .00
42 10/1/2024 5,410.85 5,410 .85 0.00
43 11/1/2024 5,410 .85 5,410 .85 0 .00
44 12/1/2024 5,410.85 5,410 .85 0 .00
2024 Totals 342,281.45 67 ,281 .45 275,000 .00
45 1/1/2025 5,410 .85 5,410 .85 0.00
46 2/1/2025 5,410.85 5,410 .85 0.00
47 3/1/2025 5,410 .85 5,410 .85 0 .00
48 4/1/2025 5,410.85 5,410 .85 0.00
49 5/1/2025 5,410 .85 5,410 .85 0 .00
so 6/1/2025 5,410 .85 5,410 .85 0 .00
51 7/1/2025 5,410 .85 5,410.85 0.00
52 8/1/2025 5,410.85 5,410.85 0 .00
53 9/1/2025 280,410.85 5,410.85 275,000.00
54 10/1/2025 5,149 .60 5,149.60 0 .00
55 11/1/2025 5,149 .60 5,149 .60 0 .00
56 12/1/2025 5,149.60 5,149.60 0.00
2025 Totals 339,146 .45 64,146.45 275,000.00
57 1/1/2026 5,149 .60 5,149 .60 0 .00
58 2/1/2026 5,149 .60 5,149 .60 0 .00
59 3/1/2026 5,149 .60 5,149.60 0 .00
60 4/1/2026 5,149 .60 5 ,149 .60 0.00
61 5/1/2026 5,149 .60 5,149.60 0 .00
62 6/1/2026 5,149.60 5 ,149 .60 0.00
63 7/1/2026 5,149.60 5 ,149.60 0 .00
64 8/1/2026 5,149 .60 5 ,149 .60 0 .00
65 9/1/2026 280,149 .60 5,149.60 275 ,000 .00
66 10/1/2026 4,888.35 4 ,888.35 0 .00
67 11/1/2026 4,888.35 4,888.35 0.00
68 12/1/2026 4,888.35 4,888 .35 0 .00
2026 Totals 336,011.45 61,011.45 275,000.00
69 1/1/2027 4,888.35 4,888 .3 5 0 .00
70 2/1/2027 4,888.35 4,888 .35 0.00
71 3/1/2027 4 ,888 .35 4,888 .35 0 .00
72 4/1/2027 4,888 .35 4,888 .35 0 .00
73 5/1/2027 4,888 .35 4,888 .35 0 .00
74 6/1/2027 4,888.35 4,888 .35 0.00
75 7/1/2027 4,888 .35 4,888 .35 0 .00
76 8/1/2027 4,888.35 4,888 .35 0 .00
77 9/1/2027 279,888 .35 4,888.35 275 ,000 .00
78 10/1/2027 4,627.10 4 ,627.10 0.00
79 11/1/2027 4,627 .1 0 4,627 .1 0 0.00
80 12/1/2027 4,627 .10 4 ,627 .10 0.00
2027 Totals 332,876 .45 57 ,876 .45 275 ,000.00
81 1/1/2028 4,627 .10 4,627.10 0 .00
82 2/1/2028 4,627 .10 4 ,627 .10 0 .00
83 3/1/2028 4,627 .10 4 ,627 .10 0 .00
84 4/1/2028 4,627 .10 4 ,627 .10 0 .00
85 5/1/2028 4,627 .10 4 ,627.10 0.00
86 6/1/2028 4,627.10 4,627.10 0.00
87 7/1/2028 4,627 .10 4 ,627.10 0.00
88 8/1/2028 4,627 .1 0 4 ,627 .1 0 0.00
89 9/1/2028 4,875,256.10 4,627.10 4 ,870,629.00
2028 Totals 4,912,272.90 41,643.90 4,870,629 .00