TC Res. No. 1981-08i •
RESOLUTION NO.#81-8
SERIES OF 1981
RESOLUTION CONCERNED WITH THE ESTABLISHMENT OF DEVELOPMENT
REVENUE BOND POLICY, PROCEDURE AND GUIDELINES.
WHEREAS, the Town Council of the Town of Avon has from
time to time been requested to sanction and participate in the issuance
of development revenue bonds, and
WHEREAS, the Town Council has determined that it is desirable
to establish those policies which the Council believes should govern'
the issuance of such bonds in order that the Council apply similar
criteria to all persons interested in the issuance of such revenue
bonds and in order to assure that those bonds'issued by the.Town of
Avon'are only for purposes which assist the community as a whole"rather
than individual interests,
NOW,-THEREFORE-, BE IT RESOLVED, by the Town Council of the
Town of Avon as follows:
Section 1. PUBLIC POLICY It is the policy of the Town of Avon
to apply similar criteria to all applicants for Town participation
in development revenue bond programs, and further toassure that any
development revenue bond programs, in which this Town participates
shall be for the purpose.of benefiting the entire community. It is
therefore the policy of the Town of Avon to encourage and participate
in development revenue bond programs to assist those activities
authorized by the 1967 County and Municipality and Development Bond Act,
set.forth as C.R.S. 1973, 29-3-101 et seq.
Section 2. DETERMINATION BY TOWN COUNCIL The Town Council
will make all necessary determinations of the desirability of projects
and-will not delegate this dermination to any agency, contractor or
employee of the Town.
Section 3. INDUCEMENT OF REMOVAL OF PROJECTS The Town will
not apply the provisions-of the 1967 County and Municipality Development
Revenue Bond Act to industries presently located in other parts of the
State of Colorado if such act is to induce removal of these industries
from their present location.
Section 4. PAYMENT OF AD VALOREM TAXES The Town declares its
intention to require the payment of any ad•valorem real estate taxes
on any project in the same amount and manner as if the ownership of the
real estate remained in private hands rather than in the ownership of
the town in the event ownership is in the Town.
Section 5. FISCAL REPUTATION OF TOWN: The Town will, in per-
forming its duties, seek to protect an enlarge the good fiscal
reputation of the Town.
Section 6. CONFIDENTIALITY OF SUBMITTAL Material supplied
under the following Sections of this policy shall not be made public
unless the Town Council at a public meeting agrees to issue the revenue
bonds provided hereunder, but this shall not preclude the Council from
giving such public notice of its consideration of the application as
necessary to attract the comments and suggestions of the community.
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Section 7. COMPLETENESS OF APPLICATION The Town Council will
not consider, nor pass any resolution of inducement or any resolution
indicating their intent to implement a proposal for revenue bond
issuance until all the application requirements provided hereunder have
satisfactorily been met.
Section 8. LOCATION OF PROJECT All property on which any
such project is to be located must be within the corporate boundaries
of the Town of Avon or whthin eight miles of the nearest point of said
corporate boundaries and such property must have affixed thereto a
zoning district classification which permits the proposed project use.
Section 9. COMPLIANCE WITH LAND;VSE~.PLANS, POLICIES AND
REGULATIONS When a Development Revenue Bond application-is made to the
Town from an applicant, evidence must be submitted that it will comply
with the following land'use plans, policies and regulations.
- The appropriate comprehensive plan,,goals, policies and map;
- The appropriate zoning regulations;
- The appropriate subdivision regulations;-
The appropriate building code.
Section 10. SITE PLAN REQUIREMENTS Insofar as practicable,
all Development Revenue Bond applicat~ons made to the Town Council
shall contain a site development plan illustrating the development which
is the subject of the request, together with a legal description, and
plans for the placement of proposed structues, parking area, access
points, internal traffic cont"ril devices, landscaping, utility-easement
locations, appropriate zoning setbacks, and any other descriptive
illustrations to aid in determining conformance with.relevant plans,
policies and regulations. This evidence must be approved by the Town
before Development Revenue Bonds 'are issued.
Section 11. PURPOSE OF REVENUE BOND PROGRAM The primary,
requirement for the approval of a revenue bond issue shall be that.the
Town receive a demonstrated public benefit involving one or more of
the following:
a) Provide facilities or benefits to the Town of Avon citizens
for economic, recreational, cultural, or health purposes
in a manner- that complements the town's own program or
facilities.
b) Carrying out stated goals and objectives of the Town's
Comprehensive Master Plan.
c) Protecting or enhancing the environment and general welfare
of the residents of the Town.
d) Enhancing the financial stability and/or tax base of the
Town.
Section 12. FINANCIAL RESPONSIBILITY OF APPLICANTS Applicants -
for revenue bond issues must clearly demonstrate financial responsibility
sufficient to amortize the proposed bond issue. The following information
must be submitted•by the applicant for consideration by the Town in
accordance with the stated criteria:
a) 'Bond Counsel; A legal opinion from a qualified("red.,book")
municipal bond counsel, acceptable to the Town Council,
stating that the applicant's request falls within the
intent and meaning of the Colorado Development Revenue Bond
Act. .
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b) Underwriter: An opinion or other satisfactory
eviderice'-from an experienced underwriter, investment
banking firm or other financial institution having
experience with Colorado revenue bond issues,
acceptable to the Town Couricil,'stating-that the bonds
can be sold on the then current municipal bond market
or placed with one or more financial institutions.
c) Public offering of Revenue Bonds: In the event the Town
Council in its discretion desires additional information,
the following information may be considered:
(1) Whether the ratio of current assets to
current liabilities is 2-to 1 or better or
the norm for the industry.
(2) Whether the net operating earnings before
deductions for interest payments and
depreciation cover maximum annual debt
service by at least 1.25 x 1.
(3) Whether the amount of bonds authorized'exceeds
the aggregate tangible net worth of the
applicant.
(4) Whether the, applicant has a successful
business history.
(5) Whether cash flow projections demonstrate the
.ability to retire the_!proposed bond issue
in a timely manner.
d) Private Placement:
'(1) Description of private placement investor(s).
(2) The debt in connection with the proposed
facility should not exceed 80% of-the appraised
'value of the facility. An appraisal prepared
by a member at the American Institute of Real
Estate Appraisers shall be submitted.' Exceptions
to this guideline should be allowed where the
applicant presents special, circumstances for'
a higher debt to appraise'value ratio.
e) Other General Economic Considerations: In addition to
the criteria set forth above, the Town Council may also
consider-:
(1) Asset life span versus term of the bond issue.
(2) Special purpose buildings.
(3) Management strength of applicant.
"Section 13. PROCEDURES Proposal for the issuance of the
revenue bonds shall be"made by iling an application at the Town Offices.
a) Staff Review: The Town Council shall direct copies of
the application to the Town's budget officer and other.
Town staff. Within 15 working days after a complete
application has been circulated, the budget officer and
staff will make a written recommendation. Exceptions
to the review period may be granted by the Council.
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b) Inducement Resolution: As soon as practicable after
a favorable staff recommendation,' an inducement
resolution will be placed on.the agenda of the Council.
Public notice of the Council's consideration of such
resolution shall be given a reasonable time prior to
the meeting at-which the resolution is to be con-
sidered.' The inducement resolution shall be approved
by the Town Attorney. All commi_tments - by the Town.
in the inducement resolution are subject to the
condition that on or before 12 months from the date
of adoption of the inducement resolution, the Town and
the applicant shall have agreed mutually to acceptable
terms for the bonds and the form of the financing
documents. Accordingly, the adoption of the inducement
resolution is not binding until the aforesaid mutual
terms are agreed upon.
c) Bond Resolution: The bond ordinance shall be filed
at the-Town office at least 14 days prior to the date
it is to,be introduced, unless a shorter time is
permitted by the Council for good,cause shown. ,Such
bond resolution shall be reviewed by the Town attorney,
bond,counsel, and the Town staff for compliance with
all of the Town's requirements.
d) Closing: Closing of the sale of the bonds shall
proceed on a reasonable time schedule after final
passage of the bond ordinance.
e) Fees and Reimbursement of Expenses:
(1) The application for the issuance of revenue bonds
shall be accompanied by a nonrefundable
application fee of $500.00, which fee shall be
credited to the fee paid at the time of issuance
of the bonds.
(2) If the bonds are issued and sold, the Town will
be paid a fee equal to .25W of the requested bond
issue, but not less than $2,500.00, to compensate
for staff time expended and for exposure to
litigation subsequent to the issue of the bonds.
(3) The applicant must agree that in the event the
bonds are not issued and sold it will reimburse
the Town for all direct, extraordinary and out-
of-pocket expenses, within ten days of the same
being billed by the Town.
Section 14. MISCELLANEOUS PROVISIONS
a) The proposed project plans shall-be reviewed and
analyzed by the Town to determine necessary on,- or
offsite capital-improvements including, but not limited
to, streets, curbs, gutters, sidewalks, utility
easements, water and sewer lines and traffic control
devices, especially if any of said improvements are
to'.-be installed'or paid,for by the Town.
b) The-Town reserves,the right to-deny any application
made hereunder, and it shall be in the-sole discretion
of the Town Council whether any application meets the
criteria established hereunder and whether the issuance
of revenue bonds hereunder should be granted.
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C) Applicant must'indemnify-the Town against all
lawsuits or costs which may result from the
termination or abandonment of the project, or from
any.other cause related to issuance of the revenue
bonds.
d) The project,financed through the bonds shall comply
with all federal, state-and local laws and
regulations- 'related to its construction and, operation.
1981.
ADOPTED THE DAY OF
ATTEST:
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