HomeMy WebLinkAboutReso 46-1982 RESOLUTION NO, 46-82
CITY COUNCIL, CITY OF SOUTH SAN FRANCISCO, STATE OF CALIFORNIA
A RESOLUTION AUTHORIZING EXECUTION
OF A REPAYMENT AGREEMENT FOR THE
GATEWAY REDEVELOPMENT'PROJECTAREA
WHEREAS, there has been presented to this Council an agreement entitled
"Repayment Agreement Among City of South San Francisco, Redevelopment Agency of
the City of South San Francisco and Homart Development Co.,.Respecting Letter of
Credit and Financing of Improvements" referred to herein as "the Repayment ^~ree-
ment;" and
WHEREAS, this Council has reviewed the Repayment Agreement and is fully
advised in the premises;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South
San Francisco that:
1. The Repayment Agreement, a copy of which is attached as Exhibit "A,"
is hereby approved.
2. The Mayor is authorized to execute said agreement, and the City Clerk
is authorized to attest his signature thereto.
3. The City Manager is hereby authorized and directed to do all things
necessary and proper to implement the abOve-mentioned agreement.
I hereby certify that the foregoing Resolution was regularly introduced
and adopted by the City Council of the City of South San Francisco at an adjnurn~
meeting held on the 28thday of April , 1982, by the following vote:
AYES: Councilmembers Ronald G. Acosta, Mark N Addiego, Emanuele N. Damonte,
NOES:
ABSENT:
Gus Nicolopulos; and Roberta Cerri Teglia
None
None
:on 04/21/82
:in 04/26182
EXHIBIT "A" TO RESOLUTION N0.46 -82
ADOPTED APRIL 28, 1982
REPAYMENT AGREEMENT AMONG CITY OF SOUTH SAN FRANCISCO,
REDEVELOPMENT AGENCY OF THE CITY OF SOUTH SAN FRANCISCO
AND HOMART DEVELOPMENT CO., RESPECTING LETTER OF CREDIT
AND FINANCING OF IMPROVEMENTS.
This Agreement dated this 28th day of April, 1982 is made among the City
of South San Francfsco ("City"), the Redevelopment Agency of the City of South
San Francisco {"A enc"
g y ) and Homart Development Co., a corporation {"Homart"}.
RECITALS
WHEREAS, the Agency is a duly constituted Redevelopment Agency under the
laws of the State of California and .pursuant to such laws has duly proceeded
with the redevelopmi~nt of the Gateway Redevelopment Project Area (the "Project
Area") within the City of South San Francisco (the "City");
WHEREAS, Homart is the developer of a project known as the Gateway
Project in the Project Area upon which it proposes to construct or cause to be
constructed a development consisting of office buildings, a hotel or hotels,
retail commercial establishments, research and development facilities and
other buildings and facilities;
WHEREAS, Homart's development is within the Project Area and subject to
the Redevelopment Plan; the City, the Agency and Homart have entered into an
.Owner Participation .and Development Agreement, dated March 19, 1981 (the
"OPA"), which deals with the development of the area by Homart and provides
for the financing of certain public improvements; including the Grand Avenue
Separation, as defi.ned therein, and various other public improvements;
WHEREAS, the Agency has de~ermined to issue h~__~,,,a~ 'in anticipation of
bonds {the "Bonds"} to provide interim financing of the Proportionate Share of
the Agency of the Local Share (as defined in the OPA) of the cost of the Grand
Avenue Separation, the security for which Notes and bonds would be limited to
the Tax Revenues of the Agency generated by future development, which,
standing alone, are insufficient to support the sale of the Notes at this time;
WHEREAS, Homart is willing to facilitate the sale of the Notes by
providing the Letter of Credit if the Agency will repay Homarl~, with interest,
from the Tax Revenues, any amounts paid by Homart to the issuing bank by
reason of any amounts drawn on the Letter of Credit;
.!
WHEREAS, it is proposed that t~e cost of the Improvements be financed by
special assessment and assessment ~ proceedings with the Agency's share of
the cost included in assessments against Homart properties, subject to
reimbursement to Homart, With interest, as herein provided.
NOW, THEREFORE, in consideration of the mutual obligations of the
parties hereto and for other good and valuable consideration, the parties
hereto agree as follows-
ARTICLE I
DEFINITIONS
1.1 Except as otherwise expressly provided herein, all capitalized
terms used herein and defined .in Article I of Resolution No. 31 adopted by the
Agency on April' 21, 1982 {the "Resolution") and in Article I of the OPA are
used in this Agreement with the meanings assigned to them in the Resolution
and the OPA, respectively.
In addition, for the purposes of this Agreement, the following
capitalized terms shall have the following meanings:
1.2 "Assessment District" shall mean the Gateway Assessment District,
City of South San Francisco, a special assessment district, proceedings for
the formation of which have been initiated by the City Council of the City and
which will be conducted pursuant to the 1913 Act and the Resolution of
Intenti on.
1.3 "Assessment Spread" shall mean the allocation of the Total Cost of
the Improvements' among the several parcels of land to be benefited by the
Improvements in the Assessment District.
1.4 "Engineer's Report" shall mean the report prepared by the Engineer
of Work pursuant to Section 10204 of the 1913 Act and the Resolution' of
Intention.
1.5 "City Contribution" shall mean, with respect to the Improvements,
(i) the construction cost of the sanitary sewers along Oyster Point Boulevard
frontage, (ii) that portion of the construction cost of undergrounding
existing overhead utilities which is obtained from Pacific Gas & Electric
Company under P.U.C. Rule No. 20, (iii) the construction cost of the pump
station and force main along Gateway Boulevard frontage, and (iv) a portion of
the construction cost of enlarging sanitary sewers along Gateway Boulevard
frontage including, in the case of each of said items, engineering,
superVision and inspection costs as incidental to construction (allocated in
proportion to construction cost}, but exclusive of any allocation of financing
costs such as bond discount, reserve fund, bond counsel fees and printing and
advertising costs.
1.6 "Improvement Bonds" shall mean improvement bonds of the City of
South San Francisco to be issued pursuant to the 1915 Act.
1.7 "Improvements'' shall mean the public improvements described in
Exhibit A hereto.
1.8 "Lot" or "Parcel" shall mean a lot or parcel shown on the Maps or
on the Parcel Map.
1-.9 "Maps" shall mean the final Subdivision' Maps' entitled "Final Map
Gateway Center." .
1.10 "1913 Act" shall mean the Municipal Improvement Act of 1913
(Section 10000 et seq. California Streets and Highways Code), amended as of.
the date of adop-{lon of the Resolution of Intention pursuant thereto.
1.11 "1915 Act" shall mean the Improvement Bond Act of 1915 (Section
8500 et seq. California Streets and Highways Code), amended as of the date of
adoption of the Resolution of Intention pursuant thereto.
1.12 "OPA" shall mean the Owner Participation and Development Agreement
dated March 19, 1981, by and among the City, .the Agency and Homart as the same
may be amended from time to time.
1.13 "Parcel Map" shall mean that certain Parcel Map recorded December
9, 1981 in Book 52 at pages 18 and 19, Book of Maps, Official Records, San
Mateo County.
1.14 "Plans and Specifications" shall mean the plans and specifications
for the Improvements included in the Engineer's Report, together with
supplements and modifications thereto approved in accordance with the
Assessment District proceedings and this agreement.
1.15 "Proportionate Share" shall mean the respective shares of. the
Agency on the one hand and Homart on the other with respect to the Total Cost
of the Improvements as set forth in Exhibit "B", as now or hereafter amended
by mutual agreement to reflect changes in the Improvements which affect the
criteria used to establish the proportionate shares under the OPA.
1.16 "Resolution of Intention" shall mean Resolution No. adopted
by the City Council of the City on , 1982 pursuant to the 1913
Act..
1.17 "Total Cost of the Improvements" shall mean the total estimated
cost of construction, total estimated cost of acquisition of lands and
easements and all incidental costs and contingencies as identified in the
Engineer's Report filed pursuant to the Resolution of Intention, incl'uding
engineering, supervision and inspection as incidental to -construction and
acquisition, and including all financing costs such as bond discount, reserve
fund, bond counsel fees and printing and advertising costs, all with respect
to the Improvements, including both the Agency's Proportionate Share and
Homart's Proportionate Share of said Costs, but exclusive of the City
Contri buti on.
ARTICLE II
FINANCING PLAN
2.1 General. (i) The Total Cost of the Improvements shall be financed
by special assessment and assessment bond proceedings for the formation of the
Assessment District, to be Conducted by the City pursuant to the 1913 Act and
the ReSolution of Intention, with Improvement Bonds to represent unpaid
assessments issued pursuant to the 1915 Act; (ii) the Proportionate Share of
the Agency of the Local Share (as defined in the OPA) of the cost of the Grand
Avenue Separation shall be financed by the issuance and sale of NOtes by the
Agency under the Resolution, further secured by the Letter of Credit.
2.2 Assessment District. The Total Cost of the Improvements shall be
the subject of the Assessment Spread, with the Agency's Proportionate Share
being an ' "Obligation to Homart" within the meaning of the Resolution, all as
more particularly provided in the Resolution and in Article IV hereof.
2.3 Tax Allocation Notes; Redevelopment Fund, The net proceeds of sale
of the Notes, together with funds received from the State Public Utilities
Commission and the Developer's Proportionate Share of the cost of the Grand
Avenue' Separation shall be deposited in the Redevelopment Fund pursuant to
Section 3.03 of. the Resolution and applied to the cost of the Grand Avenue
Sep ar at i on.
ARTICLE III
FORMATION OF ASSESSMENT DISTRICT AND
CONSTRUCTION OF IMPROVEMENTS
3.1 Initiation of Assessment Proceedings. Upon the petition of Homart,
_~City initiated assessment district proceedings on December 16, 1981 by
adoption of Resolution No. 149-81. City agrees to take all further steps as
required by the 1913 Act to implement the Assessment District with reasonable
diligence to the point of consummation of the proceedings by the levy of
special assessments upon the respective parcels within the Assessment District
and by an award of one or more public works cons, truction contracts for
·
construction and installation of the Improvements.
(a) City shall take all steps reasonably necessary to accomplish
the issuance and sale of Improvement Bonds in the amount of the unpaid special
assessments as levied upon the respective parcels, and to utilize the proceeds
of assessments and sale of the Improvement Bonds as provided in Article IV
be 1 ow.
(b) City shall make appropriate provision in the Engineer's Report
to be processed as prescribed by the 1913 Act of amounts necessary to
reimburse Homart for all preliminary engineering expense and similar expense
incurred by Homart for feasibility studies and preliminary design of the
Improvements.
(c) If the Engineer's Report results in an assessment spread to
Parcel 2 in excess of $1,800,000 {One Million Eight. Hundred Thousand Dollars)
and if there are no property owners within the Assessment District other than
Homart and Genentech, the amount allocated to Parcel 2 as shown on the Parcel
Map in relation to the Assessment Spread shall be limited .to. $1,800,000 (One
Million Eight Hundred-ThoUsand Dollars} and the excess over such sum shall be
spread to the remaining property within the Assessment'District pro rata'.
3.2 Time of-Recordation. The Maps shall be recorded prior to the
recordation of the assessment diagrams as required by the 1913 Act for
Assessment District proceedings.
3.3 Plans and Specifications. The Plans and Specifications
{preliminary) for the Improvements are identified in the Engineer's Report.
The preparation.of the final Plans and Specifications shall be done under the
direction of the Engineer of Work and shall be adopted by the City as part of
the Engineer's Report. No material changes to the Plans and Specificatons as
originally prepared and approved by the parties may be made without the mutual
consent of the parties hereto. Said work shall be done and accomplished under
the direction of them City Engineer as Engineer of Work with the advice and
consultation of Wilsey & Ham pursuant to a subcontract let by the City.
,, ,
3.4 Time for Commencement and Performance. City shall, following the
successful sale of the Improvement Bonds, let a contract or contracts with a
contractor or contractors for the construCtion of the Improvements in
accordance with the provisions of the 1913 Act and all related provisions of
California law pertaining to such public works contracts.
3.5 Contractor's Indemnity and Insurance. Any contract let for the
construction of the Improvements by the City shall require that the contractor
indemnify all parties hereto and provide public liability and property damage
insurance with single limits of not less than $10,000,000 naming all parties
~'~hereto as additional insureds.
3.6 Title to Improvements. Title to and ownership of all Improvements
constructed pursuant to the terms hereof {other'than Improvements constructed
on construction period easements expiring on completion of construction) shall
vest absolutely in the City or other public agencies,,~ persons, partnerships,.
associations or corporations to which permanent dedications of easements were
made under the terms of the Maps or otherwise.
ARTICLE IV
ASSESSMENT FINANCING OF THE IMPROVEMENTS
4.1 Contributions. City shall contribute the City Contribution to the
Total Cost of the Improvements and the amount of the City Contribution .shall
be credited to the Agency's Proportionate Share under the terms of the OPA.
City shall take all steps necessary to appropriate said sums to the
Improvement fund for the Assessment District and to obtain appropriate credits
from Pacific, Gas & Electric Co. in a time and manner to assure timely payment
of the cost and expense of the Assessment District.
4.2 Improvement Bond Financin_q. The balance of the Total Cost of the
Improvements shall be entirely paid from the proceeds of assessments and sale
of Improvement Bonds in the principal amount of the unpaid assessments.
4.3 Agency's and Homart's Proportionate Shares of Costs. The Agency's
and Homart's Proportionate Shares of the Total Cost of the Improvements shall
be determined as follows:
(a) The Total Cost of each numbered item of Improvements listed
under "Improvement Description" in Exhibit B shall first be determined by
adding to the estimated construction cost thereof its alloCated share of.
incidental expenses as identified in the definition of Total Cost of the
Improvements in Section 1.18, such allocation to be made in direct proportion
to constructi on costs.
(b) The resulting Total Cost of each numbered item4of Improvements
shall then be multipled by the percentage figures set opposite each such item
under the captions "Agency Share" and "Homart Share" ~in Exhibit B.
(c) The total aggregate amount of all of the figures resulting
from the calculations under {a} and {b) shall be the Agency's and Homart's
Proportionate Shares, respectively, of the Total Cost of the Improvements for.
purposes of the Assessment Spread in the Engineer's RepOrt.
(d) The final determination of' the Agency's and Homart's
Proportionate~ Share of the Total Cost of the Improvements shall be made upon
completion of the Improvements and acceptance thereof by the City, as provided
by the 1913 Act.
ARTICLE V
NOTE FINANCING AND LETTER OF CREDIT
5.1 Notes. Agency agrees to use its best efforts to authorize, issue,
sell and deliver the Notes in a total principal amount sufficient to provide
net proceeds equal to at least the amount of the Proportionate Share of the
Agency of the Local Share {as defined in the OPA) of'the cost of the Grand
Avenue Separation.
5~2 Letter of Credit. Homart agrees to use its best efforts to provide
to the Agency in connection with the Notes a Letter of Credit from Bank of
America National Trust and Savings Association, or other bank whose most
recently issued debt obligations are rated AAA by Standard & P'oor's
Corporation or AAA by Moody's Investors Service (the "Bank")-, in such amount
and on such terms as may be necessary to obtain a MIG-1 or AAA investment
rating for the Notes. Except as otherwise expressly provided herein, Homart
shall bear all costs of the Letter of Credit.
ARTICLE VI
AGENCY REPAYMENT OF OBLIGATIONS TO HOMART
6.1 Advances. (i) Any amounts paid by Homart (or any subsidiary
thereof) to the Bank under Section ~,~ of the Application for Issuance of
Letter of Credit (the "Applicat(on") dated as of '?--7'-~(~ , 1982, among
the Agency, the Bank, and Homart pursuant to Article V hereof and (ii) the
principal amount of the Agency's Proportionate Share of the Total Cost of the
Improvements included in the Assessment Spread pursuant to Article IV hereof
shall be deemed advances by Homart, and loans (defined as "Obligations to
Homart"~in the Resolution), subject to repayment from the Tax Revenues and the
Special Fund. The Agency promises to repay Homart the full amount of the
Obligations to .Homart so advanced, with interest computed as hereinafter
provided,, from the sources, and at the times, and in the manner hereinafter
set forth,-pursuant to Section 4.05 of the Resolution.
6.2 Repayment of Advances. Repayment of advances made by Homart
pursuant to Article IV hereof (the "Article IV Advances") shall commence on
July 1, 1983; repayment of advances made by Homart in the form of repayment of
Drawings to the Bank in the event of such a Drawing under the Letter of Credit
by the Fiscal Agent under Article V hereof (the "Article V Advances"} shall
commence on. the January I or July ! next succeeding such repayment. The
Article IV Advances and the Article V Advances' are hereinafter collectivelY
referred to as the "Advances". In either event, payments to Homart' shall
continue upon each July I and January i after commencement until the full
amounts of the Advances together with interest as hereinafter provided, have
been repaid in full. ·
6.3 Interest. Interest is payable on the Article IV Advances at the
coupon rate at which the Improvement Bonds are sold. Interest is payable in
~the Article V Advances at the coupon rate at which the Notes are sold. Such
interest shall be computed on the unpaid principal amount of the respective.
Advances on the January 1 or July 1 on which repayments are being made.
~6.4 Application of Payments. The sole source of repayment of the-.
Obligations to Homart (being the Advances and the interest thereon) shall be
the Repayment Fund created by Section 4.05 of the 'Resolution. Until the
Obligations to Homart have been repaid in full, the entire amount in the
Repayment Fund on each January I and July i on and after July 1, 1983 shall be
paid to Homart in discharge ~ tanto of the Obligations to Homart.
Such payments shall be applied to the payment of the following in
the following order of priority:
(i) interest on the Article V Advances;
(ii) principal on the Article V Advances;
(iii) interest on the Article IV Advances; and
· {iv) principal on the Article IV Advances.
Interest shall not be paid on interest accrued and unpaid because
of lack of funds in the Repayment Fund.
Until the Obligations to Homart are repaid in full, the moneys in
the Repayment Fund shall be used for no other purpose, and Homart shall have a
.security interest in the Tax Revenues and Special Fund prior and superior to
all others excepting only the security interests of the Noteholders and the
Fiscal Agent under the Resolution and the Bondholders upon issuance of the
Bonds.
6,5 Repayment from Bond Proceeds. Nothing in this Agreement shall be
construed to prevent the repayment of the Agency's Obligations to Homart from
the proceeds of Bonds to be issued at or before the maturity of the Notes or
at any other time.
6.6' Advances by Homart Not Pursuant to Special Assessment District
Proceedings. If all or any portion of the Agency's Proportionate Share of the
'lotal Cost of the Improvements is paid by Homart under the provisions of the
Public .Improvements Agreement among the City of South San Francisco, the
Agency and Homart, then all such payments by Homart shall be .deemed advances
by Homart '(defined as "Obligations to Homart" in the Resolution), subject to
repayment from Tax Revenues and the Special Fund. Such Obligations to Homart
shall be given the same priority as Article IV Advances as set forth in
Section 6.4 above. For this purpose the Agency's and Homart's Proportionate
Shares shall be as set forth in the OPA as the same may be. modified by the
said Public ImproVements'Agreement.
ARTICLE VII
MI SCELLANEOUS
7.1 Not General Obligations. The Agency's repayment obligations under
this agreement are not a general obligation of the Agency, but are special
obligations payable solely from the Tax Revenues and Special Fund as provided
in the Resolution, unless otherwise paid pursuant to Section 6.5. Neither the~
full faith and credit nor the taxing power of the Agency is pledged to
repayment of the Obl igati ons to Homart. ,.
7.2 Leqal Opinion. At the time of the issuance of the Improvement
Bonds, the Agency shall provide Homart with the legal opinion of Jones Hall
Hill & White, A Professional Law Corporation, that the City and the Agency are
duly authorized pursuant to law to make a-nd perform this Agreement and that
provisions of this Agreement are and will be valid and legally enforceable
special obligations of the Agency in accordance with their ter. ms and the terms
of the Resolution, except as such obligations may be limited by proceedings
under bankruptcy, reorganization, insolvency or other laws of general
application and principles of equity relating to or affecting the enforcement
of creditors' rights and that, commencing on the date of call of all the
Bonds, Homart shall have a security interest in the Tax Revenues and Special
Fund of the Agency prior and superior to all others, except as provided in the
Resolution.
7.3 Audits and Reports. At all times after the Notes have been issued
and until all principal and interest on the Notes have been paid and until the
amount of any Obligations to Homart shall have been paid to Homart in full,
the Agency shall provide Homart with copies of each financial statement
referred to in Section 5.06 of the Resolution within ten {10} days of the'
Agency's receipt thereof.
7.4 Notices. All notices herein required shall be in writing and shall
be delivered in person or sent by registered or certified mail, postage
prepaid. Notices required to be given shall be addressed as follows-
to City:
City Manager
City Hall
Post Office Box 711
South San Francisco, CA 94080
to Agency:
Redevelopment Agency of the City
of South San Francisco
400 Grand Avenue
South San Francisco, CA 94080
Attention: Executive Director
to Homart:
Homart Development Co.
The Xerox Centre
Suite 3100
55 West Monroe
Chicago, IL 60603
Attention: John Schippel
Homart Development Co.
450 Industrial Way
South San Francisco, CA 94080
Attention: .John Aguilar
Any party-may change such address by notice in writing to the other
party and thereafter notices shall be addressed and transmitted to the new
address.
7.5 No Agency. Nothing herein contained shall be deemed to create any
party hereto the agent of any other party hereto for any purpose whatsoever.
7.6 Headings. The headings in this agreement are inserted only as a
matter of convenience and for reference, and in no way define the scope or
extent of this agreement or the construction or instrument referred to her'ein.
7.7 Time. Time is of the essence of this agreement.
7.8 Amendments and severability. The validity of any one of the
covenants, agreements, conditions or provisions of this agreement or any
portion thereof shall not affect the remaining portions thereof or any part
thereof, and this agreement shall be construed as if such covenant, agreement,
condition or provision had not been inserted herein. This agreement may be
·
amended by the mutual consent of the parties but may not be amended, waived or
discharged, except by an instrument in w~:iting executed by the party against
which enforcement of such amendment, waiver or discharge is sought·
7.g Successors and Assigns· This agreement shall be binding upon
and inure to the benefit of parties hereto and the successors and assigns of
each of them.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed properly by their duly authorized representatives on the day and year
first above written.
· -$
,
. ~,~,
',AT,TEST:
.
City Clerk
HOMART DEVELOPMENT CO.
THE CITY OF SOUTH SAN FRANCTSCO
a municipal corporation
ATTEST:
Secretary
THE REDEVELOPMENT AGENCY OF THE
C!TY OF SOUTH SAN FRANCISCO, a
public body corporate and politic
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