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TC Ord. No. 2010-17 Authorizing the execution of a site & improvement lease, purchase AG, disclosure Cert , an Excrow AG, Preliminary Official Statment & Other Doc & Matters Relating to Certain Certs of ParticipationTOWN OF AVON, COLORADO ORDINANCE NO. 10 -17 SERIES OF 2010 AN ORDINANCE AUTHORIZING THE EXECUTION OF A SITE AND IMPROVEMENT LEASE, A LEASE PURCHASE AGREEMENT, A DISCLOSURE CERTIFICATE, AN ESCROW AGREEMENT, A PRELIMINARY OFFICIAL STATEMENT AND OTHER DOCUMENTS AND MATTERS RELATING TO CERTAIN CERTIFICATES OF PARTICIPATION. WHEREAS, the Town of Avon, Eagle County, Colorado (the "Town ") is a duly organized and existing home rule municipality of the State of Colorado, created and operating pursuant to Article XX of the Constitution of the State of Colorado and the home rule charter of the Town (the "Charter "); and WHEREAS, pursuant to Chapter XIV of the Charter, the Town is authorized to enter into one or more leases or lease - purchase agreements for land, buildings, equipment and other property for governmental or proprietary purposes; and WHEREAS, pursuant to such authority and for the purposes of financing the construction, other acquisition, and equipping of a public works maintenance facility (the "Public Works Facility "), the Town has heretofore (a) entered into that certain Ground Lease Agreement, dated as of July 1, 1998 (the "1998 Ground Lease "), whereby the Town, as lessor, has leased certain real property owned by the Town and described therein (collectively, the "Site "), to the Town of Avon Finance Authority, a Colorado nonprofit corporation (the "Finance Authority "), as lessee, and (b) entered into that certain Lease Purchase and Sublease Agreement, dated as of July 1, 1998 (the "1998 Lease "), whereby the Town has leased the Public Works Facility and subleased the Site from the Finance Authority; and WHEREAS, in order to provide funds for the construction, other acquisition, and equipping of the Public Works Facility, the Finance Authority as grantor, and The Bank of Cherry Creek, N.A., as trustee, entered into that certain Mortgage and Indenture of Trust, dated as of July 1, 1998 (the "1998 Indenture "), pursuant to which there were issued certain certificates of participation (the "1998 Certificates "), evidencing assignments of proportionate interests in rights to receive certain revenues pursuant to the 1998 Lease; and WHEREAS, the Town is permitted by the 1998 Lease to pay the "Purchase Option Price" (as defined in the 1998 Lease) to acquire the Public Works Facility, which Purchase Option Price is an amount sufficient to redeem the 1998 Certificates and pay related costs thereof; and WHEREAS, redemption of the 1998 Certificates will result in (a) termination of the 1998 Indenture pursuant to Section 6.01 thereof, (b) conveyance of the Public Works Facility to the Town pursuant to Article XII of the 1998 Lease, (c) termination of the "Lease Term" of the 1998 Lease pursuant to Section 4.2 thereof, and (d) termination of the 1998 Ground Lease pursuant to Section 5.2 thereof; and 4- WHEREAS, the 1998 Certificates were subject to prior redemption, at the option of the Town, beginning on December 1, 2009, and on any date thereafter, at a price of par plus accrued interest to the date fixed for redemption; and WHEREAS, the Town Council of the Town (the "Town Council ") has determined, and hereby determines, that it is in the best interests of the Town and its residents and taxpayers to (a) pay the Purchase Option Price in order to terminate the 1998 Lease and redeem the 1998 Certificates (the "Refunding Project "), and (b) construct, install, equip and furnish certain capital improvements within the Town (the "Improvement Project," and together with the Refunding Project, the "Project "); and WHEREAS, the Town Council has determined, and hereby determines, (a) to lease the Site and all improvements thereon, including, without limitation, the Public Works Facility (collectively, the "Leased Property "), to UMB Bank, n.a., as trustee (the "Trustee "), pursuant to a Site and Improvement Lease (the "Site Lease "), and (b) sublease the Leased Property from the Trustee pursuant to a Lease Purchase Agreement (the "Lease "); and WHEREAS, in order to produce the revenue necessary to finance the Project, the Trustee will execute an Indenture of Trust (the "Indenture "), pursuant to which certain certificates of participation evidencing proportionate interests in certain revenues under the Lease (as more particularly defined in the Indenture, the "2010 Certificates ") will be issued, and the proceeds thereof used to finance the Project; and WHEREAS, pursuant to the Lease, and subject to the right of the Town to terminate the Lease and other limitations as therein provided, the Town will pay certain Base Rentals and Additional Rentals (as such terms are defined in the Lease) in consideration for the right of the Town to use the Leased Property; and WHEREAS, the Town's obligation under the Lease to pay Base Rentals and Additional Rentals shall be from year to year only; shall constitute currently budgeted expenditures of the Town; shall not constitute a mandatory charge or requirement in any ensuing budget year; and shall not constitute a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter limitation or requirement concerning the creation of indebtedness or multiple fiscal year financial obligation, nor a mandatory payment obligation of the Town in any ensuing fiscal year beyond any fiscal year during which the Lease shall be in effect; and WHEREAS, there have been presented to the Town Council and are on file at the Town offices the following: (i) the Site Lease, in the proposed form attached hereto as Exhibit A; (ii) the Lease, in the proposed form attached hereto as Exhibit B; (iii) the Escrow Agreement relating to the Refunding Project (the "Escrow Agreement "), if such Escrow Agreement becomes necessary, in the proposed form attached hereto as Exhibit C, (iv) the Continuing Disclosure Certificate to be provided by the Town (the "Disclosure Certificate "), in the proposed form attached hereto as Exhibit D; and (v) the Preliminary Official Statement (the "Preliminary Official Statement ") relating to the 2010 Certificates, in the proposed form attached hereto as Exhibit E; and -2- WHEREAS, capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Lease; and WHEREAS, § 11 -57 -204 of the Supplemental Public Securities Act, constituting Title 11, Article 57, Part 2, Colorado Revised Statutes (the "Supplemental Act "), provides that a public entity, including the Town, may elect in an act of issuance to apply all or any of the provisions of the Supplemental Act. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO the following: Section 1. Ratification and Approval of Prior Actions. All action heretofore taken (not inconsistent with the provisions of this Ordinance) by the Town Council or the officers, agents or employees of the Town Council or the Town relating to the Site Lease, the Lease, the acquisition, construction, installation or improvement of the Improvement Project, the implementation of the Refunding Project, and the execution and delivery of the 2010 Certificates is hereby ratified, approved and confirmed. Section 2. Finding of Best Interests. The Town Council hereby finds and determines, pursuant to the Constitution, the laws of the State of Colorado and the Charter, that the acquisition, construction, and installation of the Improvement Project, the implementation of the Refunding Project, and the financing of the costs thereof pursuant to the terms set forth in the Site Lease and the Lease are necessary, convenient, and in furtherance of the Town's purposes and are in the best interests of the inhabitants of the Town and the Town Council hereby authorizes and approves the same. The Town Council hereby further finds and determines that the Refunding Project will result in interest costs savings to the Town and lower annual payments and is therefore necessary, desirable, advisable and in the best interest of the Town. Section 3. Supplemental Act; Parameters. The Town Council hereby elects to apply all of the Supplemental Act to the Site Lease and the Lease and in connection therewith delegates to each of the Mayor, the Town Manager or the Finance Director the authority to make any determination delegable pursuant to § I 1- 57- 205(1)(a -i) of the Colorado Revised Statutes, as amended, in relation to the Site Lease and the Lease, and to execute a sale certificate (the "Sale Certificate ") setting forth such determinations, including without limitation, the term of the Site Lease, the rental amount to be paid by the Trustee pursuant to the Site Lease, the term of the Lease, and the rental amount to be paid by the Town pursuant to the Lease, subject to the following parameters and restrictions: (a) the total amount of rental payments to be received by the Town from the Trustee under the Site Lease shall not be less than $6,000,000; (b) the term of the Site Lease shall not extend beyond December 31, 2040; (c) the aggregate principal amount of the Base Rentals payable by the Town pursuant to the Lease shall not exceed $7,250,000; (d) the Lease Term shall not extend beyond December 31, 2030; and (e) the maximum net effective interest rate on the interest component of the Base Rentals relating to the 2010 Certificates shall not exceed 5.00 %. Pursuant to § 11 -57 -205 of the Supplemental Act, the Town Council hereby delegates to each of the Mayor, the Town Manager or the Finance Director the authority to sign a contract for the purchase of the 2010 Certificates or to accept a binding bid for the 2010 -3- Certificates and to execute any agreement or agreements in connection therewith. In addition, each of the Mayor, the Town Manager or the Finance Director is hereby authorized to determine if obtaining an insurance policy for all or a portion of the 2010 Certificates is in the best interests of the Town, and if so, to select an insurer to issue an insurance policy, execute a commitment relating to the same and execute any related documents or agreements required by such commitment. Each of the Mayor, the Town Manager or the Finance Director is also hereby authorized to determine if obtaining a reserve fund insurance policy for the 2010 Certificates is in the best interests of the Town, and if so, to select a surety provider to issue a reserve fund insurance policy and execute any related documents or agreements required by such commitment. Section 4. Approval of Documents. The Site Lease, the Lease, the Escrow Agreement, and the Disclosure Certificate, in substantially the forms presented to the Town Council and on file with the Town, are in all respects approved, authorized and confirmed, and the Mayor or Mayor Pro Tem of the Town is hereby authorized and directed for and on behalf of the Town to execute and deliver the Site Lease, the Lease, the Escrow Agreement and the Disclosure Certificate in substantially the forms and with substantially the same contents as presented to the Town Council, provided that such documents may be completed, corrected or revised as deemed necessary by the parties thereto in order to carry out the purposes of this Ordinance. Section 5. Approval of Official Statement. A final Official Statement, in substantially the form of the Preliminary Official Statement presented to the Town Council and on file with the Town, is in all respects approved and authorized. The Mayor is hereby authorized and directed, for and on behalf of the Town, to execute and deliver the final Official Statement in substantially the form and with substantially the same content as the Preliminary Official Statement on file with the Town, with such changes as may be approved by the Town Manager or the Finance Director. The distribution of the Preliminary Official Statement and the final Official Statement to all interested persons in connection with the sale of the 2010 Certificates is hereby ratified, approved and authorized. Section 6. Authorization to Execute Collateral Documents. The Town Clerk is hereby authorized and directed to attest all signatures and acts of any official of the Town in connection with the matters authorized by this Ordinance and to place the seal of the Town on any document authorized and approved by this Ordinance. The Mayor, Mayor Pro Tem, and Town Clerk and other appropriate officials or employees of the Town are hereby authorized and directed to take all action necessary or appropriate to effectuate the provisions of this Ordinance, including without limiting the generality of the foregoing, executing, attesting, authenticating and delivering for and on behalf of the Town any and all necessary documents, instruments or certificates and performing all other acts that they deem necessary or appropriate in order to implement and carry out the transactions and other matters authorized by this Ordinance. The approval hereby given to the various documents referred to above includes an approval of such additional details therein as may be necessary and appropriate for their completion, deletions therefrom and additions thereto as may be approved by bond counsel prior to the execution of the documents. The execution of any document or instrument by the aforementioned officers or members of the Town Council shall be conclusive evidence of the -4- approval by the Town of such document or instrument in accordance with the terms hereof and thereof. Section 7. No General Obligation Debt. No provision of this Ordinance, the Site Lease, the Lease, the Indenture, the 2010 Certificates, the Preliminary Official Statement, or the final Official Statement shall be construed as creating or constituting a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter provision, nor a mandatory charge or requirement against the Town in any ensuing fiscal year beyond the then current fiscal year. The Town shall have no obligation to make any payment with respect to the 2010 Certificates except in connection with the payment of the Base Rentals (as defined in the Lease) and certain other payments under the Lease, which payments may be terminated by the Town in accordance with the provisions of the Lease. Neither the Lease nor the 2010 Certificates shall constitute a mandatory charge or requirement of the Town in any ensuing fiscal year beyond the then current fiscal year or constitute or give rise to a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter debt limitation and shall not constitute a multiple fiscal year direct or indirect debt or other financial obligation whatsoever. No provision of the Site Lease, the Lease or the 2010 Certificates shall be construed or interpreted as creating an unlawful delegation of governmental powers nor as a donation by or a lending of the credit of the Town within the meaning of Sections 1 or 2 of Article XI of the Colorado Constitution. Neither the Lease nor the 2010 Certificates shall directly or indirectly obligate the Town to make any payments beyond those budgeted and appropriated for the Town's then current fiscal year. Section 8. Reasonableness of Rentals. The Town Council hereby determines and declares that the Base Rentals due under the Lease, in the maximum amounts authorized pursuant to Section 3 hereof, constitute the fair rental value of the Leased Property and do not exceed a reasonable amount so as to place the Town under an economic compulsion to renew the Lease or to exercise its option to purchase the Trustee's leasehold interest in the Leased Property pursuant to the Lease. The Town Council hereby determines and declares that the period during which the Town has an option to purchase the Trustee's leasehold interest in the Leased Property (i.e., the entire maximum term of the Lease) does not exceed the useful life of the Leased Property. The Town Council hereby further determines that the amount of rental payments to be received by the Town from the Trustee pursuant to the Site Lease is reasonable consideration for the leasing of the Leased Property to the Trustee for the term of the Site Lease as provided therein. Section 9. No Recourse against Officers and Agents. Pursuant to § 11 -57- 209 of the Supplemental Act, if a member of the Town Council, or any officer or agent of the Town acts in good faith, no civil recourse shall be available against such member, officer, or agent for payment of the principal, interest or prior redemption premiums on the 2010 Certificates. Such recourse shall not be available either directly or indirectly through the Town Council or the Town, or otherwise, whether by virtue of any constitution, statute, rule of law, enforcement of penalty, or otherwise. By the acceptance of the 2010 Certificates and as a part of the consideration of their sale or purchase, any person purchasing or selling such 2010 Certificate specifically waives any such recourse. -5- Section 10. Severability. If any provision of this Ordinance, or the application of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term "provision" means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term "application" means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 11. Repealer. All bylaws, orders, resolutions and ordinances, or parts thereof, inconsistent herewith are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed to revise any bylaw, order, resolution or ordinance, or part thereof, heretofore repealed. Section 12. Interpretation. This Ordinance shall be so interpreted and construed as to effectuate its general purpose. Section 13. Charter Controls. Pursuant to Article XX of the State Constitution and the Charter, all State statutes that might otherwise apply in connection with the provisions of this Ordinance are hereby superseded to the extent of any inconsistencies or conflicts between the provisions of this Ordinance and the Sale Certificate authorized hereby and such statutes. Any such inconsistency or conflict is intended by the Town Council and shall be deemed made pursuant to the authority of Article XX of the State Constitution and the Charter. Section 14. Effective Date, Recording, and Authentication. This Ordinance shall be in full force and effect seven days after public notice following final passage in accordance with Section 6.4 of the Charter. This Ordinance shall be numbered and recorded in the official records of the Town kept for that purpose, and shall be authenticated by the signatures of the Mayor and Mayor Pro -Tem and Town Clerk, and published in accordance with law. Section 15. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 16. Publication by Posting. The Town Clerk is ordered to publish this Ordinance by posting notice of adoption of this Ordinance on final reading by title in at least three public places within the Town and posting at the office of the Town Clerk, which notice shall contain a statement that a full copy of this Ordinance is available for public inspection in the office of the Town Clerk during normal business hours. 0 INTRODUCED, APPROVED, PASSED ON FIRST READING, ORDERED PUBLISHED BY POSTING AND REFERRED TO PUBLIC HEARING, and setting such public hearing for October 12, 2010, at 5:30 p.m., at the Council Chambers of the Avon Municipal Build' OF d at One Lake Street, A , Colorado, o September 28, 2010. N OF q S E AL:: Ronald C. Wolfe, Mayor Published by ostan .ira• lea t three public places in Town and posting at the office of the Town Clerk at least se �� i�pr or to final action by the Town Council. ATTEST: Patty enny, Town C INTR U READING, AND ORD APPROVED AS TO FORM: .o Eric Heil, Town Attorney FINALLY APPROVED, PASSED ON SECOND PUBLISHED BY POSTING on October 12, 2010. SEAL: Published by - stipg by title id office of the To n Clerk. ATTEST: _ Brian ipes, Mayor Pro -Tem three public places in Town and posting by title at the -7- Patty enny, Town C INTR U READING, AND ORD APPROVED AS TO FORM: .o Eric Heil, Town Attorney FINALLY APPROVED, PASSED ON SECOND PUBLISHED BY POSTING on October 12, 2010. SEAL: Published by - stipg by title id office of the To n Clerk. ATTEST: _ Brian ipes, Mayor Pro -Tem three public places in Town and posting by title at the -7- EXHIBIT A FORM OF SITE AND IMPROVEMENT LEASE EXHIBIT B FORM OF LEASE PURCHASE AGREEMENT EXHIBIT C FORM OF CONTINUING DISCLOSURE CERTIFICATE EXHIBIT D FORM OF ESCROW AGREEMENT EXHIBIT E FORM OF PRELIMINARY OFFICIAL STATEMENT STATE OF COLORADO ) COUNTY OF EAGLE ) SS. TOWN OF AVON ) I, the duly elected, qualified, and acting Town Clerk of the Town of Avon, Colorado (the "Town "), do hereby certify that: (1) The foregoing pages are a true, correct and complete copy of an ordinance (the "Ordinance ") that was introduced, approved on first reading and ordered published by posting in accordance with the Town Charter (the "Charter ") by the Town Council at a regular meeting thereof held on September 28, 2010, and was introduced, approved on second and final reading, and ordered published by posting in accordance with the Charter on October 12, 2010, which Ordinance has not been revoked, rescinded or repealed and is in full force and effect on the date hereof. (2) The Ordinance was duly moved and seconded, and the Ordinance was approved on first reading, at the meeting of September 28, 2010, by an affirmative vote of a majority of the membership of the entire Town Council as follows: Councilmember "Yes" Voting "No" Absent Abstaining Ronald C. Wolfe Voting n v�`�d` -R 114) C� Brian Sipes Richard Carroll ✓ David Dantas Kristi Ferraro Amy Phillips Bu# Reynolds (3) The Ordinance was duly moved and seconded, and the Ordinance was approved on second and final reading, at the meeting of October 12, 2010, by an affirmative vote of a majority of the membership of the entire Town Council as follows: -1- Councilmember Voting "Yes" Voting "No" Absent Abstaining Ronald C. Wolfe Brian Sipes Richard. Carroll David Dantas Kristi Ferraro Amy Phillips Buzz Reynolds (4) The members of the Town Council were present at such meetings and voted on the passage of such Ordinance as set forth above. (5) The Ordinance was authenticated by the signature of the Mayor, sealed with the Town seal, attested by the Town Clerk, and recorded in the minutes of the Town Council. (6) There are no bylaws, rules or regulations of the Town Council that might prohibit the adoption of the Ordinance. (7) Notices of the meetings of September 28, 2010 and October 12, 2010 in the forms attached hereto as Exhibit A were posted at the Town Hall not less than 24 hours prior to each meeting in accordance with law. (8) On D&Dbef- I , 2010 and October 15, 2010, the full text of the Ordinance was posted at the office of the Town Clerk and in three public places in the Town in accordance with the Charter. WITNESS my hand and the seal of the Town affixed this 12 day of October, 2010. [SE , N OF A�0, ' :SEAL*: • Town Cl dR EXHIBIT A (Attach Notices of Meetings of September 28, 2010 and October 12, 20 10) TOWN OF AVON, COLORADO AV N OA%-K REGULAR MEETING FOR TUESDAY, SEPTEMBER 28, 2O1 n cu Lore 0 MEETING BEGINS AT 5:30 PM AVON TOWN HALL, ONE LAKE STREET PRESIDING OFFICIALS MAYOR RON WOLFE MAYOR PRO TEM BRIAN SIPES COUNCILORS RICHARD CARROLL, DAVE DANTAS, KRISTI FERRARO AMY PHILLIPS, ALBERT "Buz" REYNOLDS, JR. TOWN STAFF TOWN ATTORNEY: ERIC HEIL TOWN MANAGER: LARRY BROOKS TOWN CLERK: PATTY MCKENNY ALL REGULAR MEETINGS ARE OPEN TO THE PUBLIC EXCEPT EXECUTIVE SESSIONS COMMENTS FROM THE PUBLIC ARE WELCOME DURING CITIZEN AND COMMUNITY INPUT AND PUBLIC HEARINGS PLEASE VIEW AVON'S WEBSITE, HTTP: / /WWW.AVON.ORG, FOR MEETING AGENDAS AND MEETING MATERIALS AGENDAS ARE POSTED AT AVON TOWN HALL AND RECREATION CENTER, ALPINE BANK, AND AVON LIBRARY THE AVON TOWN COUNCIL MEETS ON THE SECOND AND FOURTH TUESDAYS OF EVERY MONTH 1. CALL TO ORDER AND ROLL CALL 2. APPROVAL OF AGENDA 3. DISCLOSURE OF POTENTIAL CONFLICT OF INTEREST 4. COMMUNITY & CITIZEN INPUT a. James Van Beek, Candidate for Eagle County Sheriff in November 2010 Election 5. CONSENT AGENDA a. Minutes from September 14, 2010 b. Sherman & Howard Engagement Letter (Scott Wright, Asst. Town Manager Finance) Proposal for professional bond counsel services c. Resolution 10 -20, Series of 2010, Resolution Approving an Encroachment Agreement with Holy Cross Energy for Improvements Related to the Avon Community Heat Recovery Project, Tract H, Block 2, Benchmark at Beaver Creek (Jeff Schneider, Project Engineer) d. Product & Service Purchase Agreement Contract with Imagine Technologies (Scott Wright, Asst. Town Manager Finance) Contract for purchase of the Avaya IP Office system 6. ORDINANCES a. Public Hearing on Ordinance No. 10 -14, Series of 2010, First Reading, An Ordinance Amending the Avon Municipal Code by Enacting Title 7, The Avon Development Code; Repealing Title 16: Subdivisions; Repealing Title 17: Zoning; and Repealing Portions of Title 2: Administration and Personnel (Sally Vecchio, Asst Town Manager Community Development, Eric Heil, Town Attorney) Review proposed Development Code as adopted by the Planning & Zoning Commission Public Hearings held on July 27. 2010, August 10, 2010, August 17, 2010, August 24, 2010, August 31, 2010 b. Ordinance No. 10 -17, Series of 2010, First Reading, An Ordinance Authorizing the Execution of a Site Improvement Lease, a Lease Purchase Agreement, a Disclosure Certificate, an Escrow Agreement, a Preliminary Official Statement and Other Documents and Matters Relating to Certain Certificates (Scott Wright, Asst Town Manager Finance) Review documents used for issuance of bond proceeds from Certificates of Participation ( "COPS ") for refunding of outstanding COPS & issuance of additional proceeds to be used for capital improvements, including but not limited to the Swift Gulch Transit / Public Works Facility Project Avon Council Meeting. 1 0.09.28.doc Page 4 of 5 TOWN OF AVON, COLORADO �II 0 AI AVON REGULAR MEETING FOR TUESDAY, SEPTEMBER 28, 2010 Y Ir C U 1. U N A U U MEETING BEGINS AT 5:30 PM AVON TOWN HALL, ONE LAKE STREET 6. ORDINANCES -CONTINUED c. Ordinance No. 10 -18, Series of 2010, First Reading, An Ordinance Adopting Local Designation of Noxious Weeds (Jenny Strehler, Director PW &T) Review proposed ordinance that allows for 30 day public notice period as well as amends the list to include several weeds designated by the State of Colorado for control or eradication 7. RESOLUTIONS 8. TOWN MANAGER REPORT 9. TOWN ATTORNEY REPORT 10. MAYOR REPORT 11. ADJOURNMENT FUTURE COUNCIL AGENDA DATES & PROPOSED TOPICS: OCTOBER 12TH: Budget Retreat and Regular Meeting: Comcast Franchise Agreement, Public Development Code Chateau St. Claire PUD Amendment, Ordinance on Hearing, 2nd Reading on Ordinance No. 10 -14 Avon Avon Council Meeting.10.09.28.doc Page 5 of 5 TOWN OF AVON, COLORADO � AVON REGULAR MEETING FOR TUESDAY, OCTOBER 12, 2010 VON C D L U M A D D MEETING BEGINS AT 5:30 PM AVON TOWN HALL, ONE LAKE STREET PRESIDING OFFICIALS MAYOR RON WOLFE MAYOR PRO TEM BRIAN SIPES COUNCILORS RICHARD CARROLL, DAVE DANTAS, KRISTI FERRARO AMY PHILLIPS, ALBERT "Buz" REYNOLDS, JR. TOWN STAFF TOWN ATTORNEY: ERIC HEIL TOWN MANAGER: LARRY BROOKS TOWN CLERK: PATTY MCKENNY ALL REGULAR MEETINGS ARE OPEN TO THE PUBLIC EXCEPT EXECUTIVE SESSIONS COMMENTS FROM THE PUBLIC ARE WELCOME DURING CITIZEN AND COMMUNITY INPUT AND PUBLIC HEARINGS PLEASE VIEW AVON'S WEBSITE, HTTP: / /WWW.AVON.ORG, FOR MEETING AGENDAS AND MEETING MATERIALS AGENDAS ARE POSTED AT AVON TOWN HALL AND RECREATION CENTER, ALPINE BANK, AND AVON LIBRARY THE AVON TOWN COUNCIL MEETS ON THE SECOND AND FOURTH TUESDAYS OF EVERY MONTH CALL TO ORDER AND ROLL CALL 2. APPROVAL OF AGENDA 3. DISCLOSURE OF POTENTIAL CONFLICT OF INTEREST 4. COMMUNITY & CITIZEN INPUT 5. STAFF UPDATES a. Tract J Eagle River, Old Bridge Pier Investigation Report (Shane Pegram, Project Engineer) Update Town Council on the condition of the old concrete bridge pier 6. CONSENT AGENDA b. Sherman & Howard Engagement Letter (Scott Wright, Asst. Town Manager Finance) Proposal for professional bond counsel services 7. REVIEW PLANNING & ZONING COMMISSION DECISION a. Master Sign Program ( "MSP ") Amendments within the West Town Center District Investment Plan Area specifically related to the Season's Building (Sally Vecchio, Asst. Town Manager Community Development) Review program as approved by the Planning & Zoning Commission 8. ORDINANCES a. Public Hearing on Ordinance No. 10 -17, Series of 2010, Second Reading, An Ordinance Authorizing the Execution of a Site Improvement Lease, a Lease Purchase Agreement, a Disclosure Certificate, an Escrow Agreement, a Preliminary Official Statement and Other Documents and Matters Relating to Certain Certificates (Scott Wright, Asst Town Manager Finance) Review documents used for issuance of bond proceeds from Certificates of Participation ("COPS") for refunding of outstanding COPS & issuance of additional proceeds to be used for capital improvements, including but not limited to the Swift Gulch Transit / Public Works Facility Project b. Public Hearing on Ordinance No. 10 -14, Series of 2010, First Reading, An Ordinance Amending the Avon Municipal Code by Enacting Title 7, The Avon Development Code; Repealing Title 16: Subdivisions; Repealing Title 17: Zoning; and Repealing Portions of Title 2: Administration and Personnel (Sally Vecchio, Asst Town Manager Community Development, Eric Heil, Town Attorney) Review proposed Development Code as adopted by the Planning & Zoning Commission Public Hearings held on July 27. 2010, August 10, 2010, August 17, 2010, August 24, 2010, August 31, 2010, September 28, 2010 Avon Council Meeting.10.10.12.doc Page 3 of 4 TOWN OF AVON, COLORADO AVON REGULAR MEETING FOR TUESDAY, OCTOBER 12, 2010 l� cui.ox nuo MEETING BEGINS AT 5:30 PM AVON TOWN HALL, ONE LAKE STREET 8. ORDINANCES -CONTINUED c. Public Hearing on Ordinance No. 10 -18, Series of 2010, Second Reading, An Ordinance Adopting Local Designation of Noxious Weeds (Jenny Strehler, Director PW &T) Review proposed ordinance that allows for 30 day public notice period as well as amends the list to include several weeds designated by the State of Colorado for control or eradication 9. RESOLUTIONS 10. TOWN MANAGER REPORT 11. TOWN ATTORNEY REPORT 12. MAYOR REPORT 13. ADJOURNMENT FUTURE COUNCIL AGENDA DATES & PROPOSED TOPICS: OCTOBER 26T ": Public Hearing & 2nd Reading on Ordinance No. 10 -14, Avon Development Code, Ordinance for Comcast Franchise Agreement NOVEMBER 9T": Public Hearing on Budget NOVEMBER 23RD:Adopt 2011 Budget, Swear in Newly Elected Council Members, Reception for Outgoing Council Members Avon Council Meeting.10.10.12.doc Page 4 of 4 MINUTES OF THE REGULAR MEETING OF THE AVON TOWN COUNCIL HELD SEPTEMBER 28, 2010 A regular meeting of the Town of Avon, Colorado was held at the Avon Town Hall, One Lake Street, Avon, Colorado in the Council Chambers. Mayor Ron Wolfe called the meeting to order at 5:30 PM. A roll call was taken and Council members present were Rich Carroll, Dave Dantas, Amy Phillips, Buz Reynolds, and Brian Sipes. Kristi Ferraro was absent. Also present were Town Attorney Eric Heil, Town Manager Larry Brooks, Assistant Town Manager Patty McKenny, Assistant Town Manager Community Development Sally Vecchio, Assistant Town Manager Finance Scott Wright, Town Engineer Justin Hildreth, as well as other staff members and the public. AGENDA APPROVAL & DISCLOSURE OF POTENTIAL CONFLICT OF INTEREST Mayor Wolfe noted the following agenda changes: ✓ Remove Sherman & Howard Engagement Letter until the next meeting ✓ Add Capital Improvement Project Presentation (was not completed during the work session) ✓ Attempt to impose a new meeting adjournment timeframe of 9 PM noting that any pending items would be tabled for a special meeting or the next regularly scheduled meeting ✓ Add formal vote to call up the "Master Sign Program for the Seasons Building" as presented in the work session COMMUNITY & CITIZEN INPUT ✓ Jim Lemon asked about the dilapidated bridge in the Eagle River and asked if council was going to do anything about the dangerous situation that has been created. Staff was asked to review what might need to be done to correct the situation. ✓ James Van Beek, Candidate for Eagle County Sheriff in November 2010 Election, introduced himself. ✓ Ted Archibeque, running for County Surveyor, introduced himself and noted his background and tenure in Eagle County. ✓ Michael Lindholm asked about the noxious weed ordinance and commented on the financial matters memo in the packet noting that he was in disagreement about the 4) Accounts Receivable Balances Outstanding by Traer Creek Metro District CONSENT AGENDA Mayor Wolfe asked for a motion on the consent agenda noting that item b) would not be included on the list: b. Sherman & Howard Engagement Letter (Scott Wright, Asst. Town Manager Finance) Proposal for professional bond counsel services (to be included on 10/12/10 agenda) Councilor Phillips moved to approve the consent agenda on the following two items; Mayor Pro Tern Sipes seconded the motion and it passed unanimously. a. Minutes from September 14, 2010 c. Resolution 10 -20, Series of 2010, Resolution Approving an Encroachment Agreement with Holy Cross Energy for Improvements Related to the Avon Community Heat Recovery Project, Tract H, Block 2, Benchmark at Beaver Creek (Jeff Schneider, Project Engineer) Councilor Phillips moved to approve item d) on the consent agenda; Councilor Ferraro seconded the motion and it passed unanimously (Carroll recused due to conflict of interest). d. Product & Service Purchase Agreement Contract with Imagine Technologies (Scott Wright, Asst. Town Manager Finance) Contract for purchase of the Avaya IP Office system Mayor Pro Tern Sipes moved to appeal the P &Z approval of the Season's Master Sign Program so that the Town Council could review the decision to approve the program at its next regularly scheduled meeting on October 12, 2010. Councilor Ferraro seconded the motion and it passed unanimously. ORDINANCES Public Hearing on Ordinance No. 10 -14, Series of 2010, First Reading, An Ordinance Amending the Avon Municipal Code by Enacting Title 7, The Avon Development Code; Repealing Title 16: Subdivisions; Repealing Title 17: Zoning; and Repealing Portions of Title 2: Administration and Personnel Public Hearings held on July 27. 2010, August 10, 2010, August 17, 2010, August 24, 2010, August 31, 2010 Sally Vecchio, Asst Town Manager Community Development, presented an overview of the proposed Development Code as adopted by the Planning & Zoning Commission. Topics discussed included the following: ➢ Employee Housing Mitigation (page 104); changes were recommended ➢ Duplex Lot Split Subdivisions (Wildridge); changes were recommended ➢ Design Standards Mayor Wolfe opened the public hearing and the following comments were made: ❖ Dominic Mauriello, Avon resident, no minimum lot requirements for duplex separation, 7.04.090: doesn't agree w/ comp plan as binding document, spoke about the other policy documents, parking requirements concerns ❖ Chuck Madison, East West Partners, submitted questions to town attorney, suggested that they would discuss their concerns with staff, many concerns with current language and whether or not it impacts their current development, the Westin Resort & Spa. Eric Heil confirmed that staff would meet with them and that a future public hearing would be held and their public input would be heard. ❖ Charles ?, requested that the town require applications be submitted electronically and digitally in 3 -D Mayor Wolfe closed the public hearing. He presented the topics that received attention during the discussion as follows: • Housing mitigation in high residential areas • Duplex subdivision regulations to be simplified, remove requirements, submitted for WR it would be plat approval form P &Z • Comp plan and related planning documents, is it binding collection or advisory documents • Parking requirements maximum issue • Request other 3 -D forms for applications; • Board of Realtors letters was also reviewed Council comments addressed some of the following: ✓ Address the duplex to single family subdivision separately and not within the town code ✓ Housing mitigation included as Alt. Equ Compliance review ✓ Comp plan needs to be binding ✓ PUD: eliminate setbacks and density limitations ✓ Parking is OK as is ✓ 7.04. (page 12: is this consistent with the emergency ordinance ✓ Cash in lieu definitions should be reviewed ✓ Comp plan definition seems static, should contemplate amending (page 29) Regular Council Meeting Page 2 of 4 10.09.28.doc ✓ Page 10/11: prefers that there is clarity for people about the comp plan ✓ Page 13: 7.04.120: ✓ Page 68: temporary suspension: doesn't agree with the suspension language; remove it ✓ Page 64 review period to 60 days ✓ Housing % is not acceptable to him After these comments and in light of the suggested changes, Councilor Dantas moved to table Ordinance No. 10 -14, Series of 2010, First Reading, An Ordinance Amending the Avon Municipal Code by Enacting Title 7, The Avon Development Code; Repealing Title 16: Subdivisions; Repealing Title 17: Zoning; and Repealing Portions of Title 2: Administration and Personnel. Mayor Pro Tern Sipes seconded the motion and it passed unanimously. It was noted that the public hearing was continued until the October 12, 2010 regular meeting. Ordinance No. 10 -17, Series of 2010, First Reading, An Ordinance Authorizing the Execution of a Site Improvement Lease, a Lease Purchase Agreement, a Disclosure Certificate, an Escrow Agreement, a Preliminary Official Statement and Other Documents and Matters Relating to Certain Certificates. Scott Wright, Asst Town Manager Finance, presented a review of documents used for issuance of bond proceeds from Certificates of Participation ( "COPs ") for refunding of outstanding COPs & issuance of additional proceeds to be used for capital improvements, including but not limited to the Swift Gulch Transit / Public Works Facility Project. Some of the topics reviewed included: ✓ the options were for a refunding of current COPs and issuance of "new money" ✓ the numbers related to the issuance ✓ reviewed the refinancing options Questions were answered about how the town proceeds in light of transit grant awards. It was noted that a step forward with a motion that evening would be in order to accomplish the refinance prior to the end of the year. Councilor Carroll moved to approve Ordinance Authorizing the Execution of a Site Improvement Lease, a Lease Purchase Agreement, a Disclosure Certificate, an Escrow Agreement, a Preliminary Official Statement and Other Documents and Matters Relating to Certain Certificates. Mayor Pro Tern Sipes seconded the motion and it passed with a four to two vote ( Dantas, Reynolds — nay). Jenny Strehler, Director PW &T, presented Ordinance No. 10 -18, Series of 2010, First Reading, An Ordinance Adopting Local Designation of Noxious Weeds. She made a review of the proposed ordinance that allows for 30 day public notice period as well as amends the list to include several weeds designated by the State of Colorado for control or eradication. After some questions, Councilor Phillips moved to approve Ordinance No. 10 -18, Series of 2010, First Reading, An Ordinance Adopting Local Designation of Noxious Weeds. Mayor Pro Tern Sipes seconded the motion and it passed unanimously. It was noted that the public hearing would be scheduled for October 12, 2010. MAYOR REPORT It was decided to hear the CIP update at the Budget retreat scheduled for October 12, 2010. Mayor Wolfe noted that the multi party land exchange has been moved forwarded with the execution of documents and the initiation of land appraisals. Regular Council Meeting Page 3 of 4 10.09.28.doc There being no further business to come before the Council, the regular meeting adjourned at approximately 9:30 PM. RESPECTFULLY SUBMITTED: c P ty M Kenny, o lerk APPROVED: _ /�'� Rich Carroll Dave Dantas -- Kristi Ferraro Amy Phillips Albert "Buz" Reynolds Brian Sipes Ron Wolfe Regular Council Meeting Page 4 of 4 10.09.28.doc MINUTES OF THE REGULAR MEETING OF THE AVON TOWN COUNCIL HELD OCTOBER 12, 2010 A regular meeting of the Town of Avon, Colorado was held at the Avon Town Hall, One Lake Street, Avon, Colorado in the Council Chambers. Mayor Pro Tern Sipes called the meeting to order at 5:30 PM. A roll call was taken and Council members present were Rich Carroll, Dave Dantas, Kristi Ferraro, Amy Phillips, Buz Reynolds, and Brian Sipes. Ron Wolfe was absent. Also present were Town Attorney Eric Heil, Town Manager Larry Brooks, Assistant Town Manager Patty McKenny, Assistant Town Manager Community Development Sally Vecchio, Assistant Town Manager Finance Scott Wright, Town Engineer Justin Hildreth, as well as other staff members and the public. AGENDA APPROVAL & DISCLOSURE OF POTENTIAL CONFLICT OF INTEREST ✓ Mayor Pro Tern Sipes asked for any changes, Town Attorney Eric Heil asked that an executive session be held after the meeting to discuss pending litigation with the Village at Avon. ✓ Mayor Pro Tern Sipes noted a conflict of interest with the "Master Sign Program for the Seasons Building ". Town Attorney noted that the council could determine the degree of the conflict at that time. STAFF UPDATES Shane Pegram, Project Engineer, presented an update to the Tract J Eagle River, Old Bridge Pier Investigation which was a presentation of some pictures. He noted that he was working on getting an estimate to remove the structure from the water. It was noted that once the estimate were received another update would be provided. There was consensus as to the need to try to mitigate the situation. CONSENT AGENDA Town Attorney Eric Heil presented the engagement letter and noted his approval of the revised language. Mayor Pro Tern Sipes asked for a motion on the consent agenda. Councilor Ferraro moved to approve the consent agenda; Councilor Carroll seconded the motion and it passed with a three to two vote with a condition that a fee schedule of hourly rates be included as part of the documentation ( Dantas, Reynolds nay; Wolfe absent). a. Sherman & Howard Engagement Letter (Scott Wright, Asst. Town Manager Finance) Proposal for professional bond counsel services REVIEW PLANNING & ZONING COMMISSION DECISION Mayor Pro Tern Sipes stepped down from the discussion at this time due to a conflict of interest. Councilor Reynolds moved to appoint Councilor Phillips to lead the discussion on the item; Councilor Dantas seconded the motion and it passed unanimously. Sally Vecchio, Assistant Town Manager Community Development, presented a review of the Master Sign Program ( "MSP ") Amendments within the West Town Center District Investment Plan Area specifically related to the Season's Building as approved by the Planning & Zoning Commission. She noted that as part of the renovation work on the Seasons at Avon building, the owner's of the commercial portion of the property requested an amendment to the master sign program, which was approved in 1994. It was noted that staff was asked by council to provide them information related to all land development decisions in the town core, of which this item is considered. It was also noted that the council could choose one of the following actions: ✓ Overturn the P &Z decision ✓ Uphold the P &Z decision ✓ Revise the conditions of the approval ✓ Remand the application back to P &Z for further consideration The council packet memo outlined the analysis made of the master sign program for the building and noted the following criteria that resulted in differences of opinions between the P &Z Commission & staff: Tenant Signs: • PZC interpretation of the exterior illumination requirement • second story tenant signs were unnecessary Monument Signs: ✓ Size & location of the two monument signs along Benchmark Road Matt Tracer, spoke on behalf of the property owner. With the relocation of Vail Resorts, there is a need to increase the signage for them anticipated multiple tenants. He was supportive of the decisions made by the P &Z Commission. The following commissioners spoke about the applications: Todd Goulding and Chris Green. Councilor Phillips asked if there were any public comments, none were made. Councilor Dantas moved to uphold the P &Z Commission decision and direct staff to rewrite the town center plan to allow for this type of signage. Councilor Reynolds seconded the motion and it passed with a three to one vote (Ferraro nay; Sipes recused, Wolfe absent). ORDINANCES Town Attorney Eric Heil noted that this matter of Ordinance No. 10 -17, would require a majority vote in order to pass the ordinance; that would then require four yes votes to pass; he also noted that the matter would be denied if the vote in favor of the ordinance were less than four votes. He also noted that Mayor Pro Tern Sipes does not vote and since there are five voting a tie would not occur. Scott Wright, Asst Town Manager Finance, presented Ordinance No. 10 -17, Series of 2010, Second Reading, An Ordinance Authorizing the Execution of a Site Improvement Lease, a Lease Purchase Agreement, a Disclosure Certificate, an Escrow Agreement, a Preliminary Official Statement and Other Documents and Matters Relating to Certain Certificates. He noted that this bond refinancing would be used for issuance of bond proceeds from Certificates of Participation ( "COPs ") for refunding of outstanding COPs & issuance of additional proceeds to be used for capital improvements, including but not limited to the Swift Gulch Transit / Public Works Facility Project. Jenny Strehler, Director PW &T, highlighted the Swift Gulch Site Plan and the recent award of the "State of Good Repair" Federal Grant Award and CDOT funding for this facility, noting that monies awarded would possibly total up to $6M. She noted that the bond proceeds help the project move forward, enhance the town's land as an asset, create the possibility of renting space to ECO. Town Manager Brooks commented on the project and how the town arrived to this point of the refinance. There was a review of the financial structure of the refinancing options. Town Manager Larry Brooks provided a summary of how the financing of the project happens alongside the federal and state grants. Some concerns about where the town pays for the matching monies were expressed. Mayor Pro Tern Sipes opened the public hearing, no comments were made, the hearing was closed. Councilor Ferraro moved to approve Ordinance No. 10 -17, Series of 2010, Second Reading, An Ordinance Authorizing the Execution of a Site Improvement Lease, a Lease Purchase Agreement, a Disclosure Certificate, an Escrow Agreement, a Preliminary Official Statement and Other Documents and Matters Relating to Certain Certificates. Councilor Dantas seconded the motion and it passed unanimously (Wolfe absent). Regular Council Meeting Page 2 of 4 10.10.12.doc Eric Heil, Town Attorney, presented Ordinance No. 10 -14, Series of 2010, First Reading, An Ordinance Amending the Avon Municipal Code by Enacting Title 7, The Avon Development Code; Repealing Title 16: Subdivisions; Repealing Title 17: Zoning; and Repealing Portions of Title 2: Administration and Personnel. A review of the memo included in the council packet outlining the revisions was made as follows: 1. Housing mitigation revisions 2. Duplex subdivision deletion 3. Comprehensive Plan provision and revisions 4. 3D Renderings addition 5. 7.04.110(d) revisions 6. Delete Temporary Building Suspension 7. 7.16.060 (a) revisions 8. Special Review Use revisions Mayor Pro Tern Sipes opened the Public Hearing and the following people commented: ✓ Chris Green, resident & P &Z, commented on definition, design review guidelines, ✓ Andy Sutton, representing the East West Partners, read a letter about the proposed development code and has concerns about the impacts of their ability to develop the project, requested that the town not take action on the ordinance. Town Attorney Eric Heil provided an update on the matter with East West Partners noting that he had met with their representatives. The public hearing was closed. Council comments were heard and there was a majority of the members who supported adopting the ordinance on first reading and a motion was made. Councilor Carroll moved to approve Ordinance No. 10 -14, Series of 2010, First Reading, An Ordinance Amending the Avon Municipal Code by Enacting Title 7, The Avon Development Code; Repealing Title 16: Subdivisions; Repealing Title 17: Zoning; and Repealing Portions of Title 2: Administration and Personnel with changes proposed in the memo written by Town Attorney Eric Heil dated 10/5/10 & memo written by Assistant Town Manager Sally Vecchio dated 10/6/10. Councilor Phillips seconded the motion and it passed with a three to two vote ( Dantas, Reynolds nay; Wolfe absent). It was agreed that any other comments should be forwarded to staff no later than next Monday and changes would be incorporated for second reading to take place on October 26, 2010. Jenny Strehler, Director PW &T, presented Ordinance No. 10 -18, Series of 2010, Second Reading, An Ordinance Adopting Local Designation of Noxious Weeds. She presented a review of the proposed ordinance that allows for 30 day public notice period as well as amends the list to include several weeds designated by the State of Colorado for control or eradication. Mayor Pro Tern Sipes opened the Public Hearing and input was received from Michael Lindholm, Traer Creek LP, who commented on the fact that there are many non compliant properties. He noted that there have been letters sent to the town by Often Johnson that have not been responded to. He noted that there isn't a very good mitigation plan in place for the entire town and that there needs to be a comprehensive plan. Town Attorney Eric Heil noted the letter dated 10/6/10 from Often Johnson did not get into the council packet. Councilor Dantas moved to continue the hearing and decision on Ordinance No. 10 -18 until the next meeting on October 26, 2010; Councilor Reynolds seconded the motion and it passed unanimously (Wolfe absent). Regular Council Meeting Page 3 of 4 10.10.12.doc EXECUTIVE SESSION CONVENED AT 9 PM Councilor Carroll moved to convene into an Executive Session to meet with the town attorney in order to receive legal advice pursuant to Colorado Revised Statute §24- 6- 402(4)(b) related to pending litigation regarding Town of Avon v Traer Creek Metropolitan District, 2008 CV 0385 and Traer Creek, LLC, et.al. v Town of Avon 2010 CV 316; Councilor Ferraro seconded the motion and it passed unanimously. The Executive Session adjourned at 9:30 pm. There being no further business to come before the Council, the regular meeting adjourned at 9:30 PM. APPROVED: Rich Carroll Dave Dantas Kristi Ferraro Amy Phillips Albert "Buz" Reym Brian Sipes Ron Wolfe RESPECTFULLY SUBMITTED: Patty M ny, Town Pet Regular Council Meeting Page 4 of 4 10.10.12.doc • Memo To: Honorable Mayor and Town Council Thru: Larry Brooks, Town Manager Initials Legal: Eric Heil, Town Attorney From: Scott Wright, Asst. Town Manager — Finance Date: October 6, 2010 Re: Bond Ordinance No. 10 -17 Summary: • Bond Ordinance No. 10 -17 is scheduled for a public hearing and second reading on Tuesday evening. Attached is a revised version of the final ordinance with one minor change, plus a current schedule of sources and uses and a final timetable. In order to save printing costs, please refer to the website for the materials presented at first reading, including my memorandum and the various exhibits referred to in the ordinance. The current plan is to pay and cancel the 1998 COPS on the delivery date of the 2010 COPs and to not escrow those proceeds for 30 days post closing. Consequently, one minor change has been made to the ordinance to reflect this current plan. The last recital on page two of the ordinance now includes the underlined words as follows: WHEREAS, there have been presented to the Town Council and are on file at the Town offices the following: (i) the Site Lease, in the proposed form attached hereto as Exhibit A; (ii) the Lease, in the proposed form attached hereto as Exhibit B; (iii) the Escrow Agreement relating to the Refunding Project (the "Escrow Agreement "), if such Escrow Agreement becomes necessary, in the proposed form attached hereto as Exhibit C, (iv) the Continuing Disclosure Certificate to be provided by the Town (the "Disclosure Certificate "), in the proposed form attached hereto as Exhibit D; and (v) the Preliminary Official Statement (the "Preliminary Official Statement ") relating to the 2010 Certificates, in the proposed form attached hereto as Exhibit E; and Instead of deleting the approval of the Escrow Agreement altogether, we thought it best • to just indicate that the Escrow Agreement was approved and could be used to the extent Page 1 necessary. If we end up paying and cancelling the 1998 COPS as planned then we will just not use the Escrow Agreement. If, for whatever reason, it becomes necessary to • escrow the proceeds for a short period of time before the 1998 COPS are redeemed then we will have an approved Escrow Agreement that is ready to use. Financial Implications and Discussion: As I have discussed with Council previously, the opportunity exists for the Town to refinance the existing Certificates of Participation (COPS) and issue "new money" that would be used to either provide matching funds for the Swift Gulch Transit/Public Works Facility Project or use the proceeds for existing CIP projects and reserve the funds that were to be used for those projects for the Swift Gulch project at some time in the future. A sources and uses of funds schedule follows: Sources: Bond Proceeds $ 6,955,000.00 Other Sources of Funds: Debt Service Reserve Fund 563,570.00 Prior Debt Service Fund 459,200.00 7,977.770.00 Uses: • Project Fund $ 3,000,000.00 Refunding Escrow Deposit 4,089,200.00 Debt Service Reserve Fund 647,802.98 Delivery Date Expenses: Cost of Issuance 75,000.00 Underwriter's Discount 69,550.00 Bond Insurance 88,505.00 Additional Proceeds 7,712.02 7,977,770.00 The estimated coupon rates for the bonds ranges from 1.625 % - 4.625% with a final maturity of twenty years. Recommendations: It is my recommendation that Council approve Ordinance No. 10 -17 at second reading. • Page 2 • Town Manager Comments: • Attachments: Bond Ordinance No. 10 -17 (Final Version) Sources and Uses of Funds (Updated on September 28, 2010 Updated timetable From Previous Packet: Bond Ordinance No. 10 -17 Exhibit A — Site Lease Exhibit B — Lease Purchase Agreement Exhibit C — Escrow Agreement Exhibit D — Continuing Disclosure Agreement Exhibit E — Preliminary Official Statement (Draft Form) Timetable Sources and Uses • Page 3 TOWN OF AVON, COLORADO ORDINANCE NO. 10 -17 SERIES OF 2010 AN ORDINANCE AUTHORIZING THE EXECUTION OF A SITE AND IMPROVEMENT LEASE, A LEASE PURCHASE AGREEMENT, A DISCLOSURE CERTIFICATE, AN ESCROW AGREEMENT, A PRELIMINARY OFFICIAL STATEMENT AND OTHER DOCUMENTS AND MATTERS RELATING TO CERTAIN CERTIFICATES OF PARTICIPATION. WHEREAS, the Town of Avon, Eagle County, Colorado (the "Town ") is a duly organized and existing home rule municipality of the State of Colorado, created and operating pursuant to Article XX of the Constitution of the State of Colorado and the home rule charter of the Town (the "Charter "); and WHEREAS, pursuant to Chapter XIV of the Charter, the Town is authorized to enter into one or more leases or lease - purchase agreements for land, buildings, equipment and other property for governmental or proprietary purposes; and WHEREAS, pursuant to such authority and for the purposes of financing the construction, other acquisition, and equipping of a public works maintenance facility (the "Public Works Facility "), the Town has heretofore (a) entered into that certain Ground Lease Agreement, dated as of July 1, 1998 (the "1998 Ground Lease "), whereby the Town, as lessor, has leased • certain real property owned by the Town and described therein (collectively, the "Site "), to the Town of Avon Finance Authority, a Colorado nonprofit corporation (the "Finance Authority "), as lessee, and (b) entered into that certain Lease Purchase and Sublease Agreement, dated as of July 1, 1998 (the "1998 Lease "), whereby the Town has leased the Public Works Facility and subleased the Site from the Finance Authority; and WHEREAS, in order to provide funds for the construction, other acquisition, and equipping of the Public Works Facility, the Finance Authority as grantor, and The Bank of Cherry Creek, N.A., as trustee, entered into that certain Mortgage and Indenture of Trust, dated as of July 1, 1998 (the "1998 Indenture "), pursuant to which there were issued certain certificates of participation (the "1998 Certificates "), evidencing assignments of proportionate interests in rights to receive certain revenues pursuant to the 1998 Lease; and WHEREAS, the Town is permitted by the 1998 Lease to pay the "Purchase Option Price" (as defined in the 1998 Lease) to acquire the Public Works Facility, which Purchase Option Price is an amount sufficient to redeem the 1998 Certificates and pay related costs thereof, and WHEREAS, redemption of the 1998 Certificates will result in (a) termination of the 1998 Indenture pursuant to Section 6.01 thereof, (b) conveyance of the Public Works Facility to the Town pursuant to Article XII of the 1998 Lease, (c) termination of the "Lease Term" of the 1998 Lease pursuant to Section 4.2 thereof, and (d) termination of the 1998 Ground Lease pursuant to Section 5.2 thereof; and • -1- WHEREAS, the 1998 Certificates were subject to prior redemption, at the option • of the Town, beginning on December 1, 2009, and on any date thereafter, at a price of par plus accrued interest to the date fixed for redemption; and WHEREAS, the Town Council of the Town (the "Town Council ") has determined, and hereby determines, that it is in the best interests of the Town and its residents and taxpayers to (a) pay the Purchase Option Price in order to terminate the 1998 Lease and redeem the 1998 Certificates (the "Refunding Project "), and (b) construct, install, equip and furnish certain capital improvements within the Town (the "Improvement Project," and together with the Refunding Project, the "Project "); and WHEREAS, the Town Council has determined, and hereby determines, (a) to lease the Site and all improvements thereon, including, without limitation, the Public Works Facility (collectively, the "Leased Property "), to UMB Bank, n.a., as trustee (the "Trustee "), pursuant to a Site and Improvement Lease (the "Site Lease "), and (b) sublease the Leased Property from the Trustee pursuant to a Lease Purchase Agreement (the "Lease "); and WHEREAS, in order to produce the revenue necessary to finance the Project, the Trustee will execute an Indenture of Trust (the "Indenture "), pursuant to which certain certificates of participation evidencing proportionate interests in certain revenues under the Lease (as more particularly defined in the Indenture, the "2010 Certificates ") will be issued, and the proceeds thereof used to finance the Project; and • WHEREAS, pursuant to the Lease, and subject to the right of the Town to terminate the Lease and other limitations as therein provided, the Town will pay certain Base Rentals and Additional Rentals (as such terms are defined in the Lease) in consideration for the right of the Town to use the Leased Property; and • WHEREAS, the Town's obligation under the Lease to pay Base Rentals and Additional Rentals shall be from year to year only; shall constitute currently budgeted expenditures of the Town; shall not constitute a mandatory charge or requirement in any ensuing budget year; and shall not constitute a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter limitation or requirement concerning the creation of indebtedness or multiple fiscal year financial obligation, nor a mandatory payment obligation of the Town in any ensuing fiscal year beyond any fiscal year during which the Lease shall be in effect; and WHEREAS, there have been presented to the Town Council and are on file at the Town offices the following: (i) the Site Lease, in the proposed form attached hereto as Exhibit A; (ii) the Lease, in the proposed form attached hereto as Exhibit B; (iii) the Escrow Agreement relating to the Refunding Project (the "Escrow Agreement "), if such Escrow Agreement becomes necessary, in the proposed form attached hereto as Exhibit C, (iv) the Continuing Disclosure Certificate to be provided by the Town (the "Disclosure Certificate "), in the proposed form attached hereto as Exhibit D; and (v) the Preliminary Official Statement (the "Preliminary Official Statement ") relating to the 2010 Certificates, in the proposed form attached hereto as Exhibit E; and IPA WHEREAS, capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Lease; and • WHEREAS, § 11 -57 -204 of the Supplemental Public Securities Act, constituting Title 11, Article 57, Part 2, Colorado Revised Statutes (the "Supplemental Act "), provides that a public entity, including the Town, may elect in an act of issuance to apply all or any of the provisions of the Supplemental Act. NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF AVON, COLORADO the following: Section 1. Ratification and Approval of Prior Actions. All action heretofore taken (not inconsistent with the provisions of this Ordinance) by the Town Council or the officers, agents or employees of the Town Council or the Town relating to the Site Lease, the Lease, the acquisition, construction, installation or improvement of the Improvement Project, the implementation of the Refunding Project, and the execution and delivery of the 2010 Certificates is hereby ratified, approved and confirmed. Section 2. Finding of Best Interests. The Town Council hereby finds and determines, pursuant to the Constitution, the laws of the State of Colorado and the Charter, that the acquisition, construction, and installation of the Improvement Project, the implementation of the Refunding Project, and the financing of the costs thereof pursuant to the terms set forth in the Site Lease and the Lease are necessary, convenient, and in furtherance of the Town's purposes and are in the best interests of the inhabitants of the Town and the Town Council hereby • authorizes and approves the same. The Town Council hereby further finds and determines that the Refunding Project will result in interest costs savings to the Town and lower annual payments and is therefore necessary, desirable, advisable and in the best interest of the Town. Section 3. Supplemental Act; Parameters. The Town Council hereby elects to apply all of the Supplemental Act to the Site Lease and the Lease and in connection therewith delegates to each of the Mayor, the Town Manager or the Finance Director the authority to make any determination delegable pursuant to § 11- 57- 205(1)(a -i) of the Colorado Revised Statutes, as amended, in relation to the Site Lease and the Lease, and to execute a sale certificate (the "Sale Certificate ") setting forth such determinations, including without limitation, the term of the Site Lease, the rental amount to be paid by the Trustee pursuant to the Site Lease, the term of the Lease, and the rental amount to be paid by the Town pursuant to the Lease, subject to the following parameters and restrictions: (a) the total amount of rental payments to be received by the Town from the Trustee under the Site Lease shall not be less than $6,000,000; (b) the term of the Site Lease shall not extend beyond December 31, 2040; (c) the aggregate principal amount of the Base Rentals payable by the Town pursuant to the Lease shall not exceed $7,250,000; (d) the Lease Term shall not extend beyond December 31, 2030; and (e) the maximum net effective interest rate on the interest component of the Base Rentals relating to the 2010 Certificates shall not exceed 5.00 %. Pursuant to § 11 -57 -205 of the Supplemental Act, the Town Council hereby delegates to each of the Mayor, the Town Manager or the Finance Director the authority to sign a contract for the purchase of the 2010 Certificates or to accept a binding bid for the 2010 • -3- Certificates and to execute any agreement or agreements in connection therewith. In addition, iseach of the Mayor, the Town Manager or the Finance Director is hereby authorized to determine if obtaining an insurance policy for all or a portion of the 2010 Certificates is in the best interests of the Town, and if so, to select an insurer to issue an insurance policy, execute a commitment relating to the same and execute any related documents or agreements required by such commitment. Each of the Mayor, the Town Manager or the Finance Director is also hereby authorized to determine if obtaining a reserve fund insurance policy for the 2010 Certificates is in the best interests of the Town, and if so, to select a surety provider to issue a reserve fund insurance policy and execute any related documents or agreements required by such commitment. Section 4. Approval of Documents. The Site Lease, the Lease, the Escrow Agreement, and the Disclosure Certificate, in substantially the forms presented to the Town Council and on file with the Town, are in all respects approved, authorized and confirmed, and the Mayor or Mayor Pro Tern of the Town is hereby authorized and directed for and on behalf of the Town to execute and deliver the Site Lease, the Lease, the Escrow Agreement and the Disclosure Certificate in substantially the forms and with substantially the same contents as presented to the Town Council, provided that such documents may be completed, corrected or revised as deemed necessary by the parties thereto in order to carry out the purposes of this Ordinance. Section 5. Approval of Official Statement. A final Official Statement, in substantially the form of the Preliminary Official Statement presented to the Town Council and • on file with the Town, is in all respects approved and authorized. The Mayor is hereby authorized and directed, for and on behalf of the Town, to execute and deliver the final Official Statement in substantially the form and with substantially the same content as the Preliminary Official Statement on file with the Town, with such changes as may be approved by the Town Manager or the Finance Director. The distribution of the Preliminary Official Statement and the final Official Statement to all interested persons in connection with the sale of the 2010 Certificates is hereby ratified, approved and authorized. Section 6. Authorization to Execute Collateral Documents. The Town Clerk is hereby authorized and directed to attest all signatures and acts of any official of the Town in connection with the matters authorized by this Ordinance and to place the seal of the Town on any document authorized and approved by this Ordinance. The Mayor, Mayor Pro Tem, and Town Clerk and other appropriate officials or employees of the Town are hereby authorized and directed to take all action necessary or appropriate to effectuate the provisions of this Ordinance, including without limiting the generality of the foregoing, executing, attesting, authenticating and delivering for and on behalf of the Town any and all necessary documents, instruments or certificates and performing all other acts that they deem necessary or appropriate in order to implement and carry out the transactions and other matters authorized by this Ordinance. The approval hereby given to the various documents referred to above includes an approval of such additional details therein as may be necessary and appropriate for their completion, deletions therefrom and additions thereto as may be approved by bond counsel prior to the execution of the documents. The execution of any document or instrument by the • aforementioned officers or members of the Town Council shall be conclusive evidence of the -4- approval by the Town of such document or instrument in accordance with the terms hereof and thereof. • Section 7. No General Obligation Debt. No provision of this Ordinance, the Site Lease, the Lease, the Indenture, the 2010 Certificates, the Preliminary Official Statement, or the final Official Statement shall be construed as creating or constituting a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter provision, nor a mandatory charge or requirement against the Town in any ensuing fiscal year beyond the then current fiscal year. The Town shall have no obligation to make any payment with respect to the 2010 Certificates except in connection with the payment of the Base Rentals (as defined in the Lease) and certain other payments under the Lease, which payments may be terminated by the Town in accordance with the provisions of the Lease. Neither the Lease nor the 2010 Certificates shall constitute a mandatory charge or requirement of the Town in any ensuing fiscal year beyond the then current fiscal year or constitute or give rise to a general obligation or other indebtedness or multiple fiscal year financial obligation of the Town within the meaning of any constitutional, statutory or Charter debt limitation and shall not constitute a multiple fiscal year direct or indirect debt or other financial obligation whatsoever. No provision of the Site Lease, the Lease or the 2010 Certificates shall be construed or interpreted as creating an unlawful delegation of governmental powers nor as a donation by or a lending of the credit of the Town within the meaning of Sections 1 or 2 of Article XI of the Colorado Constitution. Neither the Lease nor the 2010 Certificates shall directly or indirectly obligate the Town to make any payments beyond those budgeted and appropriated for the Town's then current fiscal year. Section 8. Reasonableness of Rentals. The Town Council hereby • determines and declares that the Base Rentals due under the Lease, in the maximum amounts authorized pursuant to Section 3 hereof, constitute the fair rental value of the Leased Property and do not exceed a reasonable amount so as to place the Town under an economic compulsion to renew the Lease or to exercise its option to purchase the Trustee's leasehold interest in the Leased Property pursuant to the Lease. The Town Council hereby determines and declares that the period during which the Town has an option to purchase the Trustee's leasehold interest in the Leased Property (i.e., the entire maximum term of the Lease) does not exceed the useful life of the Leased Property. The Town Council hereby further determines that the amount of rental payments to be received by the Town from the Trustee pursuant to the Site Lease is reasonable consideration for the leasing of the Leased Property to the Trustee for the term of the Site Lease as provided therein. Section 9. No Recourse against Officers and Agents. Pursuant to § 11 -57- 209 of the Supplemental Act, if a member of the Town Council, or any officer or agent of the Town acts in good faith, no civil recourse shall be available against such member, officer, or agent for payment of the principal, interest or prior redemption premiums on the 2010 Certificates. Such recourse shall not be available either directly or indirectly through the Town Council or the Town, or otherwise, whether by virtue of any constitution, statute, rule of law, enforcement of penalty, or otherwise. By the acceptance of the 2010 Certificates and as a part of the consideration of their sale or purchase, any person purchasing or selling such 2010 Certificate specifically waives any such recourse. • -5- Section 10. Severability. If any provision of this Ordinance, or the application • of such provision to any person or circumstance, is for any reason held to be invalid, such invalidity shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are declared to be severable. The Town Council hereby declares that it would have passed this Ordinance and each provision thereof, even though any one of the provisions might be declared unconstitutional or invalid. As used in this Section, the term "provision" means and includes any part, division, subdivision, section, subsection, sentence, clause or phrase; the term "application" means and includes an application of an ordinance or any part thereof, whether considered or construed alone or together with another ordinance or ordinances, or part thereof, of the Town. Section 11. Repealer. All bylaws, orders, resolutions and ordinances, or parts thereof, inconsistent herewith are hereby repealed to the extent only of such inconsistency. This repealer shall not be construed to revise any bylaw, order, resolution or ordinance, or part thereof, heretofore repealed. Section 12. Interpretation. This Ordinance shall be so interpreted and construed as to effectuate its general purpose. Section 13. Charter Controls. Pursuant to Article XX of the State Constitution and the Charter, all State statutes that might otherwise apply in connection with the provisions of this Ordinance are hereby superseded to the extent of any inconsistencies or • conflicts between the provisions of this Ordinance and the Sale Certificate authorized hereby and such statutes. Any such inconsistency or conflict is intended by the Town Council and shall be deemed made pursuant to the authority of Article XX of the State Constitution and the Charter. Section 14. Effective Date, Recording, and Authentication. This Ordinance shall be in full force and effect seven days after public notice following final passage in accordance with Section 6.4 of the Charter. This Ordinance shall be numbered and recorded in the official records of the Town kept for that purpose, and shall be authenticated by the signatures of the Mayor and Mayor Pro -Tem and Town Clerk, and published in accordance with law. Section 15. Safety Clause. The Town Council hereby finds, determines and declares that this Ordinance is promulgated under the general police power of the Town, that it is promulgated for the health, safety and welfare of the public, and that this Ordinance is necessary for the preservation of health and safety and for the protection of public convenience and welfare. The Town Council further determines that the Ordinance bears a rational relation to the proper legislative object sought to be obtained. Section 16. Publication by Posting. The Town Clerk is ordered to publish this Ordinance by posting notice of adoption of this Ordinance on final reading by title in at least three public places within the Town and posting at the office of the Town Clerk, which notice shall contain a statement that a full copy of this Ordinance is available for public inspection in the office of the Town Clerk during normal business hours. • I on INTRODUCED, APPROVED, PASSED ON FIRST READING, ORDERED PUBLISHED BY POSTING AND REFERRED TO PUBLIC HEARING, and setting such is public hearing for October 12, 2010, at 5:30 p.m., at the Council Chambers of the Avon Municipal Building, located at One Lake Street, Avon, Colorado, on September 28, 2010. Ronald C. Wolfe, Mayor Published by posting in at least three public places in Town and posting at the office of the Town Clerk at least seven days prior to final action by the Town Council. ATTEST: Patty McKenny, Town Clerk APPROVED AS TO FORM: Eric Heil, Town Attorney INTRODUCED, FINALLY APPROVED, PASSED ON SECOND READING, AND ORDERED PUBLISHED BY POSTING on October 12, 2010. Ronald C. Wolfe, Mayor • Published by posting by title in at least three public places in Town and posting by title at the office of the Town Clerk. ATTEST: Patty McKenny, Town Clerk 110 • • EXHIBIT A FORM OF SITE AND IMPROVEMENT LEASE • • EXHIBIT B • FORM OF LEASE PURCHASE AGREEMENT • • • EXHIBIT C FORM OF CONTINUING DISCLOSURE CERTIFICATE 11 • EXHIBIT D • FORM OF ESCROW AGREEMENT • • • EXHIBIT E FORM OF PRELIMINARY OFFICIAL STATEMENT • U STATE OF COLORADO ) COUNTY OF EAGLE ) SS. TOWN OF AVON ) I, the duly elected, qualified, and acting Town Clerk of the Town of Avon, Colorado (the "Town "), do hereby certify that: (1) The foregoing pages are a true, correct and complete copy of an ordinance (the "Ordinance ") that was introduced, approved on first reading and ordered published by posting in accordance with the Town Charter (the "Charter ") by the Town Council at a regular meeting thereof held on September 28, 2010, and was introduced, approved on second and final reading, and ordered published by posting in accordance with the Charter on October 12, 2010, which Ordinance has not been revoked, rescinded or repealed and is in full force and effect on the date hereof. (2) The Ordinance was duly moved and seconded, and the Ordinance was approved on first reading, at the meeting of September 28, 2010, by an affirmative vote of a majority of the membership of the entire Town Council as follows: Councilmember Voting "Yes" Voting "No" Absent Abstaining Ronald C. Wolfe Brian Sipes Richard Carroll David Dantas Kristi Ferraro Amy Phillips Buzz Reynolds (3) The Ordinance was duly moved and seconded, and the Ordinance was approved on second and final reading, at the meeting of October 12, 2010, by an affirmative vote of a majority of the membership of the entire Town Council as follows: -1- • • • • • • Councilmember Voting "Yes" Voting "No" Absent Abstaining Ronald C. Wolfe Brian Sipes Richard Carroll David Dantas Kristi Ferraro Amy Phillips Buzz Reynolds (4) The members of the Town Council were present at such meetings and voted on the passage of such Ordinance as set forth above. (5) The Ordinance was authenticated by the signature of the Mayor, sealed with the Town seal, attested by the Town Clerk, and recorded in the minutes of the Town Council. (6) There are no bylaws, rules or regulations of the Town Council that might prohibit the adoption of the Ordinance. (7) Notices of the meetings of September 28, 2010 and October 12, 2010 in the forms attached hereto as Exhibit A were posted at the Town Hall not less than 24 hours prior to each meeting in accordance with law. (8) On September _, 2010 and October _, 2010, the full text of the Ordinance was posted at the office of the Town Clerk and in three public places in the Town in accordance with the Charter. WITNESS my hand and the seal of the Town affixed this [SEAL] -2- day of October, 2010. Town Clerk EXHIBIT A (Attach Notices of Meetings of September 28, 2010 and October 12, 20 10) • • U Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. TABLE OF CONTENTS • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Report Page Sources and Uses of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . I Bond Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Detailed Bond Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Savings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Summary of Refunding Results . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Bond Summary Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Bond Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Prior Bond Debt Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Summary of Bonds Refunded . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1 Escrow Descriptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Escrow Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 • Escrow Cash Flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Escrow Sufficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Escrow Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 I/1 I PiperJaffraym Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 1 SOURCES AND USES OF FUNDS TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Dated Date 10/28/2010 Delivery Date 10/28/2010 Sources: Bond Proceeds: Par Amount 6,955,000.00 Other Sources of Funds: Debt Service Reserve Fund 563,570.00 Prior Debt Service Fund 459,200.00 1,022,770.00 7,977,770.00 Uses Project Fund Deposits: Project Fund 3,000,000.00 Refunding Escrow Deposits: SLGS Purchases 4,089,200.00 Other Fund Deposits: Debt Service Reserve Fund 647,802.98 Delivery Date Expenses: Cost of Issuance 75,000.00 Underwriter's Discount 69.550.00 Bond Insurance 88,505.00 233,055.00 Other Uses of Funds: Additional Proceeds 7,712.02 7,977,770.00 PiperJaff ray. • • • Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. page 2 • BOND DEBT SERVICE TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Dated Date 10/28/2010 Delivery Date 10/28/2010 Period Ending Principal Coupon Interest Debt Service 12/01/2011 230,000 1.625% 277,890.58 507,890.58 12/01/2012 250,000 1.750% 250,818.76 500,818.76 12/01/2013 260,000 2.000% 246,443.76 506,443.76 12/01/2014 260,000 2.250% 241,243.76 501,243.76 12/01/2015 270,000 2.500% 235,393.76 505,393.76 12/01/2016 280,000 2.750% 228,643.76 508,643.76 12/01/2017 280,000 3.000% 220,943.76 500,943.76 12/01/2018 290,000 3.250% 212,543.76 502,543.76 12/01/2019 300,000 3.500% 203,118.76 503,118.76 12/01/2020 310,000 3.625% 192,618.76 502,618.76 12/01/2021 325,000 3.875% 181,381.26 506,381.26 12/01/2022 335,000 4.000% 168,787.52 503,787.52 12/01/2023 350,000 4.000% 155,387.52 505,387.52 12/01/2024 365,000 4.125% 141,387.52 506,387.52 12/01/2025 375,000 4.125% 126,331.26 501,331.26 12/01/2026 395,000 4.250% 110,862.50 505,862.50 • 12/01/2027 415,000 4.375% 94,075.00 509,075.00 12/01/2028 425,000 4.500% 75,918.76 500,918.76 12/01/2029 445,000 4.500% 56,793.76 501,793.76 12/01/2030 795,000 4.625% 36,768.76 831,768.76 6,955,000 3,457,353.28 10,412,353.28 r� PiperJaff ray® Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 3 DETAILED BOND DEBT SERVICE • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (New Money) Dated Date 10/28/2010 Delivery Date 10/28/2010 Serial Bond Period Ending Principal Coupon Interest Debt Service 12/01/2011 120,000 1.625% 135,660.06 255,660.06 12/01/2012 130,000 1.750% 122,318.76 252,318.76 12/01/2013 135,000 2.000% 120,043.76 255,043.76 12/01/2014 135,000 2.250% 117,343.76 252,343.76 12/01/2015 140,000 2.500% 114,306.26 254,306.26 12/01/2016 145,000 2.750% 110,806.26 255,806.26 12/01/2017 145,000 3.000% 106,818.76 251,818.76 12/01/2018 150,000 3.250% 102,468.76 252,468.76 12/01/2019 155,000 3.500% 97,593.76 252,593.76 12/01/2020 160,000 3.625% 92,168.76 252,168.76 12/01/2021 170,000 3.875% 86,368.76 256,368.76 12/01/2022 175,000 4.000% 79,781.26 254,781.26 12/01/2023 180,000 4.000% 72,781.26 252,781.26 12/01/2024 190,000 4.125% 65,581.26 255,581.26 • 12/01/2025 195,000 4.125% 57,743.76 252,743.76 12/01/2026 205,000 4.250% 49,700.00 254,700.00 12/01/2027 215,000 4.375% 40,987.50 255,987.50 12/01/2028 220,000 4.500% 31,581.26 251,581.26 12/01/2029 230,000 4.500% 21,681.26 251,681.26 12/01/2030 245,000 4.625% 11,331.26 256,331.26 3,440,000 1,637,066.48 5,077,066.48 • PiperJaff ray® Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 4 • DETAILED BOND DEBT SERVICE TOWN OF AVON, COLORADO REFUNDING CERTIFICATES OF PARTICIPATION Principal IN LEASE PURCHASE AND SUBLEASE AGREEMENT Interest SERIES 2010 12/01/2011 (Refund Series 1998) 1.625% Dated Date 10/28/2010 252,230.52 Delivery Date 10/28/2010 Serial Bond Period Ending Principal Coupon Interest Debt Service 12/01/2011 110,000 1.625% 142,230.52 252,230.52 12/01/2012 120,000 1.750% 128,500.00 248,500.00 12/01/2013 125,000 2.000% 126,400.00 251,400.00 12/01/2014 125,000 2.250% 123,900.00 248,900.00 12/01/2015 130,000 2.500% 121,087.50 251,087.50 12/01/2016 135,000 2.750% 117,837.50 252,837.50 12/01/2017 135,000 3.000% 114,125.00 249,125.00 12/01/2018 140,000 3.250% 110,075.00 250,075.00 12/01/2019 145,000 3.500% 105,525.00 250,525.00 12/01/2020 150,000 3.625% 100,450.00 250,450.00 12/01/2021 155,000 3.875% 95,012.50 250,012.50 12/01/2022 160,000 4.000% 89,006.26 249,006.26 12/01/2023 170,000 4.000% 82,606.26 252,606.26 12/01/2024 • 175,000 4.125% 75,806.26 250,806.26 12/01/2025 180,000 4.125% 68,587.50 248,587.50 12/01/2026 190,000 4.250% 61,162.50 251,162.50 12/01/2027 200,000 4.375% 53,087.50 253,087.50 12/01/2028 205,000 4.500% 44,337.50 249,337.50 12/01/2029 215,000 4.500% 35,112.50 250,112.50 12/01/2030 550,000 4.625% 25,437.50 575,437.50 3,515,000 1,820,286.80 5,335,286.80 • PiperJaffray® • Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 5 PV of savings from cash flow 8,539.71 Plus: Refunding funds on hand 3,391.59 Net PV Savings 11,931.30 Piperjaffray. • SAVINGS TOWN OF AVON, COLORADO REFUNDING CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refund Series 1998) Present Value Prior Prior Prior Refunding Refunding Refunding to 10128/2010 Date Debt Service Receipts Net Cash Flow Debt Service Receipts Net Cash Flow Savings Q 4.1747171% 12/01/2010 459,200.00 459,200.00 ( 1,735.90) 12/01/2011 561,120.00 11,271.40 549,848.60 252,230.52 7,148.11 245,082.41 304,766.19 291,558.84 12/01/2012 562,500.00 11,271.40 551,228.60 248,500.00 6,547.88 241,952.12 309,276.48 283,950.75 12/01/2013 562,500.00 11,271.40 551,228.60 251,400.00 6,547.88 244,852.12 306,376.48 269,741.05 12/01/2014 561,500.00 11,271.40 550,228.60 248,900.00 6,547.88 242,352.12 307,876.48 259,926.78 12101/2015 559,500.00 11,271.40 548,228.60 251,087.50 6,547.88 244,539.62 303,688.98 245,850.80 12/01/2016 561,500.00 11,271.40 550,228.60 252,837.50 6,547.88 246,289.62 303,938.98 235,933.98 12/01/2017 562,250.00 11,271.40 550,978.60 249,125.00 6,547.88 242,577.12 308,401.48 229,553.62 12/01/2018 561,750.00 574,841.40 (13.091.40) 250,075.00 6,547.88 243,527.12 (256,618.52) (184,350.40) 12/01/2019 250,525.00 6,547.88 243,977.12 (243,977.12) 1168,284.36) 12/0112020 250,450.00 6,547.88 243,902.12 (243,902.12) (161,388.63) 12/012021 250,012.50 6,547.88 243,464.62 (243,464.62) (154.543.80) • 12/012022 249,006.26 6,547.88 242,458.38 (242,458.38) (147.639.96) 12/012023 252,606.26 6,547.88 246,058.38 (246,058.38) (143,721.25) 12/012024 250,806.26 6,547.88 244,258.38 (244,258.38) (136,858.84) 12/012025 248,587.50 6,547.88 242,039.62 (242,039.62) (130.089.68) 12/012026 251,162.50 6,547.88 244,614.62 (244,614.62) (126,108.81) 12/012027 253,087.50 6,547.88 246,539.62 (246,539.62) (121,912.93) 12/012028 249,337.50 6,547.88 242,789.62 (242,789.62) (115,159.39) 12/012029 250,112.50 6,547.88 243,564.62 (243,564.62) (110,806.66) 12/012030 575,437.50 333,942.20 241,495.30 (241,495.30) (105,375.48) 4,951,820.00 1,112,941.20 3,838,878.80 5,335,286.80 458,952.15 4,876,334.65 ( 1,037,455.85) 8,539.71 Savings Summary PV of savings from cash flow 8,539.71 Plus: Refunding funds on hand 3,391.59 Net PV Savings 11,931.30 Piperjaffray. • Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 6 SUMMARY OF REFUNDING RESULTS • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Dated Date 10/28/2010 Delivery Date 10/28/2010 Arbitrage yield 4.174717% Escrow yield 0.071143% Bond Par Amount 3,515,000.00 True Interest Cost 4.321567% Net Interest Cost 4.396991% Average Coupon 4.129769% Average Life 12.540 Par amount of refunded bonds 3,990,000.00 Average coupon of refunded bonds 4.997272% Average life of refunded bonds 4.417 PV of prior debt to 10/28/2010 n 4.174717% 4,198,256.17 Net PV Savings 11,931.30 Percentage savings of refunded bonds 0.299030% Percentage savings of refunding bonds 0.339440% 1I 11 u • PiperJaff ray Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 7 BOND SUMMARY STATISTICS TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Dated Date Delivery Date First Coupon Last Maturity Arbitrage Yield True Interest Cost (TIC) Net Interest Cost (NIC) All -In TIC Average Coupon Average Life (years) Duration of Issue (years) Par Amount Bond Proceeds Total Interest Net Interest Bond Years from Dated Date Bond Years from Delivery Date Total Debt Service Maximum Annual Debt Service Average Annual Debt Service Underwriter's Fees (per $1000) Average Takedown Other Fee Total Underwriter's Discount Bid Price Bond Component 10/28/2010 10/28/2010 06/01/2011 12/01/2030 4.174717% 4.286058% 4.364375% 4.407988% 4.088758% 12.158 9.199 6,955,000.00 6,955,000.00 3,457,353.28 3,526,903.28 84,557,541.67 84,557,541.67 10,412,353.28 831,768.76 518,242.39 10.000000 10.000000 99.000000 Par Average Average Value Price Coupon Life Serial Bond 6,955,000.00 100.000 4.089% 12.158 6,955,000.00 12.158 PiperJaff ray® • • Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 8 • BOND SUMMARY STATISTICS TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) All -In Arbitrage TIC TIC Yield Par Value 6,955,000.00 6,955,000.00 6,955,000.00 • Accrued Interest • Premium (Discount) Underwriter's Discount (69.550.00) (69.550.00) - Cost of Issuance Expense (75.000.00) -Other Amounts (88.505.00) (88.505.00) (88.505.00) Target Value 6,796,945.00 6,721,945.00 6,866,495.00 Target Date 10/28/2010 10/28/2010 10/28/2010 Yield 4.286058% 4.407988% 4.174717% C, • PiperJaff ray. Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 9 BOND PRICING • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Maturity Bond Component Date Amount Rate Yield Price Serial Bond: 12/01/2011 230,000 1.625% 1.625% 100.000 12/01/2012 250,000 1.750% 1.750% 100.000 12/01/2013 260,000 2.000% 2.000% 100.000 12/01/2014 260,000 2.250% 2.250% 100.000 12/01/2015 270,000 2.500% 2.500% 100.000 12/01/2016 280,000 2.750% 2.750% 100.000 12/01/2017 280,000 3.000% 3.000% 100.000 12/01/2018 290,000 3.250% 3.250% 100.000 12/01/2019 300,000 3.500% 3.500% 100.000 12/01/2020 310,000 3.625% 3.625% 100.000 12/01/2021 325,000 3.875% 3.875% 100.000 12/01/2022 335,000 4.000% 4.000% 100.000 12/01/2023 350,000 4.000% 4.000% 100.000 12/01/2024 365,000 4.125% 4.125% 100.000 12/01/2025 375,000 4.125% 4.125% 100.000 12/01/2026 395,000 4.250% 4.250% 100.000 12/01/2027 415,000 4.375% 4.375% 100.000 12/01/2028 425,000 4.500% 4.500% 100.000 12/01/2029 445,000 4.500% 4.500% 100.000 12/01/2030 795,000 4.625% 4.625% 100.000 Net Proceeds 6,885,450.00 Piperjaffray. • 6,955,000 Dated Date 10/28/2010 Delivery Date 10/28/2010 First Coupon 06/01/2011 Par Amount 6,955,000.00 Original Issue Discount Production 6,955,000.00 100.000000% Underwriter's Discount (69,550.00) (1.000000) Purchase Price 6,885,450.00 99.000000% Accrued Interest Net Proceeds 6,885,450.00 Piperjaffray. • Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 10 PRIOR BOND DEBT SERVICE • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Dated Date 10/28/2010 Delivery Date 10/28/2010 • • PiperJaff ray. Period Ending Principal Coupon Interest Debt Service 12/01/2010 360,000 4.800% 99,200 459,200 12/01/2011 380,000 4.900% 181,120 561,120 12/01/2012 400,000 5.000% 162,500 562,500 12/01/2013 420,000 5.000% 142,500 562,500 12/01/2014 440,000 5.000% 121,500 561,500 12/01/2015 460,000 5.000% 99,500 559,500 12/01/2016 485,000 5.000% 76,500 561,500 12/01/2017 510,000 5.000% 52,250 562,250 12/01/2018 535,000 5.000% 26,750 561,750 3,990,000 961,820 4,951,820 Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 1 1 • is PiperJaffraye SUMMARY OF BONDS REFUNDED • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Maturity Interest Par Call Call Bond Date Rate Amount Date Price Series 1998: SERIAL 12/01/2010 4.800% 360,000.00 12/01/2011 4.900% 380,000.00 12/01/2010 100.000 TERM 12/01/2018 5.000% 3,250,000.00 12/01/2010 100.000 3,990,000.00 • is PiperJaffraye Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 12 • ESCROW DESCRIPTIONS TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Type of Type of Maturity First Int Par Max Security SLGS Date Pmt Date Amount Rate Rate Oct 28, 2010: SLGS Certificate 12/01/2010 12/01/2010 4,089,200 0.070% 0.070% 4,089,200 SLGS Summary • PiperJaff ray® SLGS Rates File 28SEP10 Total Certificates of Indebtedness 4,089,200.00 Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 13 ESCROW COST • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Type of Maturity Par Total Security Date Amount Rate Cost SLGS 12/01/2010 4,089,200 0.070% 4,089,200.00 4,089,200 4,089,200.00 Purchase Cost of Cash Total Date Securities Deposit Escrow Cost 10/28/2010 4,089,200 4,089,200.00 4,089,200 0.00 4,089,200.00 PiperJaff ray® • • Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Pagc 14 ESCROW CASH FLOW • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Net Escrow Date Principal Interest Receipts 12/01/2010 4,089,200.00 266.64 4,089,466.64 4,089,200.00 266.64 4,089,466.64 • • PiperJaff ray® Escrow Cost Summary Purchase date Purchase cost of securities 10/28/2010 4,089,200.00 Sep 28, 2010 1:12 pm Prepared by Piper Jaffray & Co. Page 15 ESCROW SUFFICIENCY • TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Escrow Date Requirement Net Escrow Receipts Excess Excess Receipts Balance 12/01/2010 4,089,200.00 4,089,466.64 266.64 266.64 4,089,200.00 4,089,466.64 266.64 • PiperJaff ray. r� Sep 28, 2010 1:12 pm Prepared by Piper ]affray & Co. Page 16 • Pipe rjaffray • ESCROW STATISTICS TOWN OF AVON, COLORADO CERTIFICATES OF PARTICIPATION IN LEASE PURCHASE AND SUBLEASE AGREEMENT SERIES 2010 (Refunding & New Money) Modified Yield to Yield to Perfect Value of Total Duration Receipt Disbursement Escrow Negative Cost of Escrow Escrow Cost (years) Date Date Cost Arbitrage Dead Time Series 2010 (Refund 1998 COPS): DSRF 563,570.00 0.092 0.071148% 0.071148% 563,570.00 2,093.83 BP 3,525,630.00 0.092 0.071143% 0.071143% 3,525,630.00 13,098.81 4,089,200.00 4,089,200.00 15,192.64 0.00 Delivery date 10/28/2010 Arbitrage yield 4.174717% • Pipe rjaffray • $6,800,000* TOWN OF AVON, COLORADO Refunding Certificates of Participation, Series 2010 Draft Timetable, as of September 30, 2010 S M T W T F S 1 2 3 4 5 0 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 S M T W T F S 9/17/10 Time TBD -2 Nu Document Review Session Location: Sherman & Howard All 9/20/10 POS Distributed (Estimate) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Final Closing Documents Distributed All 11/16/10 Closing All S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 F M 26 27 28 29 30 Date Event Responsibility 9/9/10 Revised Legal Documents Distributed BC 9/17/10 Time TBD -2 Nu Document Review Session Location: Sherman & Howard All 9/20/10 POS Distributed (Estimate) BC 9/28/10 . Send Documents to Rating Agencies • First Reading of the Ordinance BC /UW A 10/11/10 Ratings Calls with Agencies: • 10:00 a.m. Moody's • 12:00 p.m. S &P A/UW 10/12/10 Second Reading of the Ordinance 10/15/10 . Receive Ratings and Insurance Quote • Post POS UW BC 10/21/10 . Market Bonds • CPA Signed UW A 10/22/10 Final OS Distributed for Comments BC 10/26/10 . Closing Documents Distributed • Comments Back to Bond Counsel on OS All 11/1/10 Final OS Printed and Distributed Printer 11/5/10 Final Closing Documents Distributed All 11/16/10 Closing All A - I own of Avon, 5tatt and Consultants BC - Bond Counsel and Disclosure Counsel (Sherman & Howard) UW - Underwriter (Piper Jaffray & Co) * Estimate Piperjaff ray. 0 • • i Sherman & Howard L.L.C. Dee P. Wisor Direct Dial Number: (303) 299 -8228 E -mail: dwisor @shermanhoward.com Town of Avon P.O. Box 975 400 Benchmark Road Avon, CO 81620 Attention: Scott Wright Dear Scott: ATTORNEYS & COUNSELORS AT LAW 633 SEVENTEENTH STREET, SUITE 3000 DENVER, COLORADO 80202 TELEPHONE: (303) 297 -2900 FAX: (303) 298 -0940 W W W.SHERMANHOWARD.COM October 6, 2010 Re: Lease Purchase Agreement and approximately $6,800,000 Certificates of Participation, Series 2010 We are pleased to confirm our engagement as special counsel to the Town of Avon, Colorado (the "Town ") in connection with the execution of a Lease Purchase Agreement • (the "Lease ") by the Town and related Certificates of Participation, Series 2010, in the approximate amount of $6,800,000 (the "Certificates "). We appreciate your confidence in us and will do our best to continue to merit it. This letter sets forth the role we propose to serve and the responsibilities we propose to assume as special counsel to the Town in connection with the Lease and the Certificates. Personnel Dee Wisor will be principally responsible for the work performed by Sherman & Howard L.L.C. on your behalf. He will be assisted by David Lucas and Maria Harwood. Where appropriate, certain tasks may be performed by other attorneys or paralegals. At all times, however, Dee Wisor will coordinate, review, and approve all work completed for the Town. Scope of Employment As your special counsel we are being engaged as a recognized expert whose primary responsibility is to render an objective legal opinion with respect to the authorization of securities like the Certificates. We will: examine applicable law; consult with the parties to the transaction prior to the execution of the Lease; prepare customary authorizing and operative documents, which may include the Lease, an indenture of trust, a site lease and related documents, proceedings relating to the authorization and execution of the Lease and related documents and issuance of the Certificates and closing certificates; review a certified transcript of proceedings; and undertake such additional duties as we deem necessary to render the opinion. • • Sherman & Howard L.L.C. Town of Avon, Colorado October 6, 2010 Page 2 Subject to the completion of proceedings to our satisfaction, we will render our opinion relating to the validity of the Lease and the Certificates, the enforceability of the security for the Certificates, and the exclusion of the interest of the rentals paid under the Lease which is paid by the Trustee as interest on the Certificates (subject to certain limitations which may be expressed in the opinion) from gross income for federal income tax purposes, and in the case of all the Certificates the exclusion of the interest of the rentals paid under the Lease which is paid by the Trustee as interest on the Certificates for Colorado income tax purposes. We are also being retained by you to act as special counsel to the Town in connection with the Official Statement for the Certificates (the "Official Statement "). As such, we will provide advice to the Town on the applicable legal standards to be used in preparing the Official Statement and meeting the Town's disclosure responsibilities. At the conclusion of the transaction, we will deliver a letter to you stating that we have assisted the Town in the preparation of the Official Statement, and that in the course of such assistance, nothing has come to the attention of the attorneys in our firm rendering legal services in connection with our representation which leads us to believe that the Official Statement, as of its date (except for the financial statements, other statistical data and statements of trends and forecasts, and information concerning the bond insurer, if any, and information concerning The Depository Trust Company and its procedures contained in the Official Statement and its Appendices, as to which we express no view), contains any untrue statement of material fact or omits to state any material fact necessary to make the statements in the Official Statement, in light of the circumstances under which they were made, not misleading. In delivering our opinion and letter, we will rely upon the certified proceedings and other certifications of public officials and other persons furnished to us without undertaking to verify the same by independent investigation. Our opinion and letter will be addressed to the Town and will be executed and delivered by us in written form on the date the Certificates are exchanged for their purchase price (the "Closing "). The opinion and letter will be based on facts and law existing as of their date. Our services are limited to those contracted for explicitly herein; the Town's execution of this letter constitutes an acknowledgment of those limitations. Specifically, but without implied limitation, our responsibilities do not include any representation by Sherman & Howard L.L.C. in connection with any IRS audit or any litigation involving the Town or the Certificates, or any other matter. Neither do we assume responsibility for the preparation of any collateral documents (e.g., environmental impact statements) which are to be filed with any state, federal or other regulatory agency. Nor do our services include financial advice (including financial advice about the structure of the Lease or Certificates) or advice on the investment of funds related to the Lease or Certificates. • Sherman & Howard L.L.C. Town of Avon, Colorado October 6, 2010 Page 3 Representation of the Town In performing our services, the Town will be our client and an attorney- client relationship will exist between us. We will represent the interests of the Town, rather than the Town Council (the "Council "), the Council's individual members or employees of the Town. We will work closely with the Town Attorney and will rely on the opinion of the Town Attorney with regard to specific matters, including pending litigation. We assume that other parties to the transaction will retain such counsel as they deem necessary and appropriate to represent their interests in this transaction. Conflicts of Interest Our firm sometimes represents, in other unrelated transactions, certain of the financial institutions that may be involved in this transaction, such as underwriters, credit enhancers, and banks that act as paying agents or trustees. We do not believe that there is a significant risk that any of these representations will materially limit our ability to provide competent and diligent representation of the Town in connection with the Lease and the Certificates and the Lease, even though such representations may be characterized as adverse under the Colorado Rules of Professional Conduct (the "Rules "). In any event, during the term • of our engagement hereunder, we will not accept a representation of any of these parties in any matter in which the Town is an adverse party. However, pursuant to the Rules, we do ask that you consent to our representation of such parties in transactions that do not directly or indirectly involve the Town. Your execution of this letter will signify the Town's prospective consent to such adverse representations in matters unrelated to the Certificates and the Lease while we are serving as bond counsel hereunder. In determining whether to consent to and waive the foregoing potential conflicts of interest, you should understand that your waiver includes your acknowledgement and agreement: (i) that you are not entitled to information we will obtain during our representation of our other clients, and (ii) that we have no duty to provide such information to you or to use it in representing you. We will treat your execution of this letter as consent to any future representations of such other parties in matters unrelated to our representation of the Town as described above. If at any time a question should arise about an adverse representation, please do not hesitate to contact us. Fee Arrangement Based upon: (i) our current understanding of the terms, structure, size and schedule of the financing, (ii) the duties we will undertake pursuant to this letter, (iii) the time we anticipate devoting to the financing, and (iv) the responsibilities we will assume, we estimate that our fee for this engagement will be $45,000. Such fee may vary: (i) if the principal amount of the Certificates increases significantly, (ii) if material changes in the structure of the financing • L Sherman & Howard L.L.C. Town of Avon, Colorado October 6, 2010 Page 4 occur, or (iii) if unusual or unforeseen circumstances arise which require a significant increase in our time or our responsibilities. Specifically, if the Certificates are not delivered at Closing on or before December 15, 2010, it will be necessary for us to repeat and update much of our work and a commensurate increase in our fees will result. If, at any time, we believe that circumstances require an adjustment of our original fee estimate, we will consult with you. In addition, this letter authorizes us to make disbursements on your behalf, which we estimate will not exceed $1,200. The Town agrees to reimburse us for such disbursements, including travel costs, photocopying, deliveries, filing fees, and other necessary expenses. Our fees are usually paid at Closing out of Certificate proceeds. We customarily do not submit any statement until the Closing, unless there is a substantial delay in completing the financing. We understand and agree that our contingent fees will be paid at Closing out of proceeds. If the financing is not consummated, we understand and agree that we will not be paid. Termination of Engagement The above fees contemplate compensation for usual and customary services as • special counsel to the Town, as described above. Upon delivery of the opinion and letter, our responsibilities as special counsel will terminate with respect to this financing, and our representation of the Town and the attorney - client relationship created by this engagement letter will be concluded. Specifically, but without implied limitation, we do not undertake to provide continuing advice to the Town or to any other party to the transaction. Many post- issuance events may affect the Lease, the tax- exempt status of interest on the Lease, or liabilities of the parties to the transaction. Such subsequent events might include a change in the project to be financed with Certificate proceeds, a failure by one of the parties to comply with its contractual obligations (e.g., rebate requirements, continuing disclosure requirements), an IRS audit, or a change in federal or state law. Should the Town seek our advice on a post - closing matter or seek other, additional legal services, we would be happy to discuss the nature and extent of our separate engagement at that time. Document Retention At or within a reasonable period after Closing, we will review the file to determine what materials should be retained as a record of our representation and those which are no longer needed. We will provide you with a copy of the customary transcript of documents after Closing and will return any original documents obtained from you (if a copy is not included in the transcript). We will retain for several years a copy of the transcript and such other materials as correspondence, final substantive work product, documents obtained from you, and documents obtained from third parties. We will not retain such materials as duplicates of the above - described material, or drafts and notes that do not appear needed any longer. • Sherman & Howard L.L.C. Town of Avon, Colorado • October 6, 2010 Page 5 Ordinarily the firm will keep the retained materials until seven years after the final maturity of the Certificates. At the end of that time, unless you advise us in writing to the contrary, we will destroy the bulk of the file. If the file is especially voluminous, we may destroy all or a portion of it earlier, as our storage facilities are limited. If you prefer other arrangements for retention or disposition of our files in this matter, please advise us in writing. Approval If the estimated fees and other foregoing terms of this engagement are acceptable to you, please so indicate by returning the enclosed copy of this letter signed by the officer so authorized, retaining the original for your files. We appreciate this opportunity to serve as your special counsel on this financing and look forward to a mutually satisfactory and beneficial relationship. • DPW:jw Enclosures cc: Eric Heil, Esq. • Accepted and Approved: TOWN OF AVON, COLORADO By:_ Title: Date: PUBFIN \1220671.2 SHERMAN & OWARD L.L.C. By: -P—G . TOWN OF AVON, COLORADO VON AVON REGULAR MEETING FOR TUESDAY, OCTOBER 12, 2010 co " • MEETING BEGINS AT 5:30 PM AVON TOWN HALL, ONE LAKE STREET PRESIDING OFFICIALS MAYOR RON WOLFE MAYOR PRO TEM BRIAN SIPES COUNCILORS RICHARD CARROLL, DAVE DANTAS, KRISTI FERRARO AMY PHILLIPS, ALBERT "Buz" REYNOLDS, JR. TOWN STAFF TOWN ATTORNEY: ERIC HEIL TOWN MANAGER: LARRY BROOKS TOWN CLERK: PATTY MCKENNY ALL REGULAR MEETINGS ARE OPEN TO THE PUBLIC EXCEPT EXECUTIVE SESSIONS COMMENTS FROM THE PUBLIC ARE WELCOME DURING CITIZEN AND COMMUNITY INPUT AND PUBLIC HEARINGS PLEASE VIEW AVON'S WEBSITE, HTTP: / /WWW.AVON.ORG, FOR MEETING AGENDAS AND MEETING MATERIALS AGENDAS ARE POSTED AT AVON TOWN HALL AND RECREATION CENTER, ALPINE BANK, AND AVON LIBRARY THE AVON TOWN COUNCIL MEETS ON THE SECOND AND FOURTH TUESDAYS OF EVERY MONTH 1. CALL TO ORDER AND ROLL CALL 2. APPROVAL OF AGENDA 3. DISCLOSURE OF POTENTIAL CONFLICT OF INTEREST 4. COMMUNITY & CITIZEN INPUT 5. STAFF UPDATES • a. Tract J Eagle River, Old Bridge Pier Investigation Report (Shane Pegram, Project Engineer) Update Town Council on the condition of the old concrete bridge pier 6. CONSENT AGENDA b. Sherman & Howard Engagement Letter (Scott Wright, Asst. Town Manager Finance) Proposal for professional bond counsel services 7. REVIEW PLANNING & ZONING COMMISSION DECISION a. Master Sign Program ( "MSP ") Amendments within the West Town Center District Investment Plan Area specifically related to the Season's Building (Sally Vecchio, Asst. Town Manager Community Development) Review program as approved by the Planning & Zoning Commission 8. ORDINANCES a. Public Hearing on Ordinance No. 10 -17, Series of 2010, Second Reading, An Ordinance Authorizing the Execution of a Site Improvement Lease, a Lease Purchase Agreement, a Disclosure Certificate, an Escrow Agreement, a Preliminary Official Statement and Other Documents and Matters Relating to Certain Certificates (Scott Wright, Asst Town Manager Finance) Review documents used for issuance of bond proceeds from Certificates of Participation ( "COPS ") for refunding of outstanding COPS & issuance of additional proceeds to be used for capital improvements, including but not limited to the Swift Gulch Transit / Public Works Facility Project b. Public Hearing on Ordinance No. 10 -14, Series of 2010, First Reading, An Ordinance Amending the Avon Municipal Code by Enacting Title 7, The Avon Development Code; Repealing Title 16: Subdivisions; Repealing Title 17: Zoning; and Repealing Portions of Title 2: Administration and Personnel (Sally Vecchio, Asst Town Manager Community Development, Eric Heil, Town Attorney) Review proposed Development Code as adopted by the Planning & Zoning Commission • Public Hearings held on July 27. 2010, August 10, 2010, August 17, 2010, August 24, 2010, August 31, 2010, September 28, 2010 Avon Council Meeting.10.10.12 Page 3 of 4 TOWN OF AVON, COLORADO AVON AVON REGULAR MEETING FOR TUESDAY, OCTOBER 12, 2010 C U L O Y A U• MEETING BEGINS AT 5:30 PM AVON TOWN HALL, ONE LAKE STREET 8. ORDINANCES - CONTINUED c. Public Hearing on Ordinance No. 10 -18, Series of 2010, Second Reading, An Ordinance • Adopting Local Designation of Noxious Weeds (Jenny Strehler, Director PW &T) Review proposed ordinance that allows for 30 day public notice period as well as amends the list to include several weeds designated by the State of Colorado for control or eradication 9. RESOLUTIONS 10. TOWN MANAGER REPORT 11. TOWN ATTORNEY REPORT 12. MAYOR REPORT 13. ADJOURNMENT FUTURE COUNCIL AGENDA DATES & PROPOSED TOPICS: OCTOBER 26TH: Public Hearing & 2 "d Reading on Ordinance No. 10 -14, Avon Development Code, Ordinance for Comcast Franchise Agreement NOVEMBER 9TH: Public Hearing on Budget NOVEMBER 23RD:Adopt 2011 Budget, Swear in Newly Elected Council Members, Reception for Outgoing Council Members • • Avon Council Meeting.10.10.12 Page 4 of 4