Loading...
HomeMy WebLinkAboutResolution 4168 Creating, Capitalizing, and Establishing the Guidelines for the Bozeman Blast Clean-up Loan Fund COMMISSION RESOLUTION N0.4168 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, CREATING, CAPITALIZING, AND ESTABLISHING THE GUIDELINES FOR THE BOZEMAN BLAST CLEAN-UP LOAN FUND. WHEREAS, downtown Bozeman is a hub of the Bozeman community, a major contributor to the City's quality of life, and is critical to the City's economic vitality as it provides immeasurable social and economic benefits to residents and guests of the City; and WHEREAS, an explosion occurred on March 5, 2009, destroying several buildings on the north side of the 200 block of East Main St. in downtown Bozeman; and WHEREAS, the debris of the destroyed buildings continues to exist; and WHEREAS, several property and business owners whose property and businesses were destroyed in the explosion and resulting fire seek to clean up debris located on the site as quickly as possible to ensure plans for rebuilding are moved forward in as expeditious a manner as possible; and WHEREAS, the City Commission desires to assist the various business and property owners whose property was destroyed in the March 5, 2009 explosion in expediting the cleanup of the affected sites by providing a loan of money to four property owners to be used exclusively for cleanup of existing debris and as such desires to create the Bozeman Blast Clean-Up Fund; and WHEREAS, the monies for the Fund will consist of $90,000 of money recycled from the City's Economic Development Revolving Loan Fund, $110,000 of money from the City's Housing Revolving Loan Fund, $50,000 from the City's general fund; and $50,000 from Northwestern Energy pursuant to the Bozeman Downtown Recovery Fund Participation Agreement, approved by the City Commission for signature by the City Manger on May 18, 2009; and WHEREAS, Gallatin Development Corporation, d/b/a/ Prospera Business Network, a private, non-profit, member-supported economic development organization, as a gesture of good will to the citizens of Bozeman, agrees to hold, distribute and track the monies allocated under this Fund and loaned to the four participating property owners and receive payments from the owners and, in turn, return those payments to the appropriate contributing source as detailed below; and WHEREAS, Prospera Business Network is in no way responsible for the loan proceeds or assumes any liability stemming from the cleanup of the site; and WHEREAS, the City Commission specifically finds loaning money to the affected property owners constitutes a valid public purpose because the existing condition of the properties destroyed in the explosion is having a negative effect on the economic vitality of downtown Bozeman and expediting the cleanup will benefit the economic recovery of the entire City of Bozeman; and WHEREAS, the City Commission specifically finds that while the loans may be provided to private individuals to expedite the cleanup of the affected properties, the loans benefit the inhabitants of the City of Bozeman as a community, not just as individual property owners and although private property and business owners may benefit from the loans, the loans provides a public benefit as it shows the community's commitment to the social and economic vitality of downtown Bozeman. NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City of Bozeman, Montana: Section 1 -Fund Establishment The Bozeman Blast Clean-Up Loan Fund (the Fund) is hereby established. The use of monies from the Fund are exempt from requirements of City of Bozeman Res. 3866 (Policy for Granting City Funds) but are subject to the City of Bozeman's living wage ordinance (Chapter 2.96 of the Bozeman Municipal Code) as well as all other federal and state law regarding prevailing wages, including the Montana Prevailing Wage Act, Title 18, Chpt. 2, Part 4, MCA, and any State of Montana administrative rules established there under by the Montana Department of Labor & Industry. Section 2 - Elisible Borrowers The Fund will make loans, through Prospera Business Network ("Prospera") to the real property owners who experienced catastrophic building loss as a result of the natural gas explosion on March 5, 2009. The only property owners eligible under the Fund include the following: Ralph Ferraro, Robert Sanks, Ann C. Bates, and the Gallatin Post #14 of the American Legion. Each of the above property owners are eligible to receive a percentage of the total Fund capitalization, described in Section 5, below, based on their specific percentage of the total above ground square footage as described in Section 4, below. The above listed property owners are hereby referred to individually and collectively as the "Borrowers." Section 3 - Eligible Activities Loans will be made available to eligible borrowers for the only following activities: debris removal services, hauling costs, landfill tipping fees, and fencing and screening of the site. Use of the loan proceeds by a borrower for any purpose other than described herein and not i consistent shall be cause for immediate breach and all monies shall be repaid to the City of Bozeman immediately. No monies from this loan will be used for any political purpose. Section 4 -Application Procedures & Loan Terms Upon adoption of this Resolution, eligible borrowers may apply for loans under this Fund by making a request to the Bozeman City Attorney's Office. The City Attorney's Office will prepare a Memorandum of Agreement for each loan recipient. Prior to distribution of the Fund monies to the Borrowers, agreements with all eligible Borrowers must be executed by the Borrowers and the City Manager. By adopting this Resolution the Commission specifically authorizes the City Manager to sign the Memorandum of Agreements thus fully executing and binding the City of Bozeman to said Agreement. The loan monies will be transferred to Prospera and will be available for draw, pursuant to Section 6, below, by the eligible Borrowers. The loan amount for each recipient will be pursuant to the loan recipient's total above ground floor area as a percentage of the sum of the above ground floor area for all properties located within the affected area pursuant to the following schedule: _ _ _ _ _ ~._______.__.___~ _ v____~_.. ..~ Ralph Ferraro 24.7% $74,100 Robert and Mary Sanks ~ 15.8% $47,400 Ann C. Bates 30% $90,000 Gallatin Post #14 of the American Legion ~ 29.5% $88,500 Section 5 -Fund Capitalization The Fund will be created with a total and maximum of $300,000. This is the maximum amount available for loans to Borrowers. Principal will be loaned-out from the sources in the amounts and order listed below, fully utilizing one source before moving to the next: $50,000 from the City General Fund. ii. $50,000 from the Northwestern Energy contribution. iii. $110,000 from the City's Housing Revolving Loan Funds. iv. $90,000 from the City's Economic Development Revolving Loan Fund. In the event that the cost of eligible activities does not amount to $300,000, unused portions of the Fund will be returned to their sources immediately upon completion of all eligible activities. To the extent money is loaned-out, re-payments of Principal will be credited to sources in the following order, fully crediting one source before moving to the next: i. $90,000 to the City's Economic Development Revolving Loan Fund. ii. $110,000 to the City's Housing Revolving Loan Funds. iii. $50,000 to Northwestern Energy for their contribution. iv. $50,000 to the City General Fund. Section 6 -Fund Administration Prospera will administer the Fund, and in doing so perform the following duties: i. Hold the Fund dollars in aninterest-bearing account fully covered by FDIC insurance. ii. Upon written certification by the Borrowers and the presentation of detailed itemized invoices indicating the work completed, and after execution of Promissory Notes for the amount to be loaned as approved by the City Attorney, disburse eligible loan amounts commensurate with the invoice amounts to Borrowers for eligible activities. Borrowers may receive only those amounts for which certification and invoices have been presented and in no case shall receive more than the allocation listed in Section 4, above. iii. Issue account statements to Borrowers for payments according to the terms of each Borrower's Memorandum of Agreement and Promissory Note(s) on a quarterly basis. iv. Determine when eligible activities are complete and no more loan funds will be available to Borrowers and recommend to the City when "unused portions" of the Loan Fund may be returned to their sources. v. Report to the City, in writing, the balance of the fund and all outstanding loan balances on June 30, 2009, and each quarter there-after. vi. Upon payment by the Borrower to Prospera for any principal amount Prospera will return any funds other than those that are to return to the Economic Development Revolving Loan Fund to the City on a quarterly basis. Prospera will transfer directly to the Economic Development Revolving Loan Fund any monies owed to that fund. vii. As compensation for fund administration services, Prospera will retain a 2% (two- percent) closing and administrative fee at the time each loan disbursement is made to the Borrowers. PASSED AND ADOPTED by the City Commission of the City of Bozeman, Montana, at a regular session thereof held on the 18th day of May 2009. ~ (~-Gt-~`~-~ KAAREN JACOBS N Mayor ATTEST: I ST CY EN, C C City Clerk APPROVED AS TO FORM: