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R-04-40 A RESOLUTION AUTHORIZING THE EXTENSION AND MODIFICATION OF CERTAIN OBLIGATIONS OF THE CITY TO REPAY CITY OF PORTSMOUTH PROMISSORY NOTES DUE IN AUGUST 2004. WHEREAS, the City of Portsmouth, Virginia entered into a Contract for Loan Guarantee Assistance with the United States Department of Housing and Urban Development ("HUD") dated January 21, 1997 (the "Contract"); and WHEREAS, the Contract was entered into under the provisions of Section 108 of Title I of the Housing and Community Development Act of 1974, as amended (42 U.S.C. section 5308); and WHEREAS, the City of Portsmouth executed certain additional documents and issued certain Promissory Notes ("the Notes") pursuant to the Contract; and WHEREAS, the principal mount of the Notes has been reduced from $2.4 million to $1.765 million since 1997; and WHEREAS, payment of the entire remaining balance of $1.765 million is due in August 2004; and WHEREAS, HUD has offered the City the opportunity to modify its existing obligations under the Contract, the Notes, and other related documents upon terms and conditions beneficial to the City; and WHEREAS, the terms and conditions offered by HUD significantly reduce the City's short-term financial obligations by extending the repayment period; and WHEREAS, the modification of the City's existing obligations under the Contract, the Notes, and other related documents is fiscally responsible and desirable. NOW THEREFORE BE IT RESOLVED by the Council of the City of Portsmouth, Virginia that it hereby authorizes the modification of its existing financial obligations under the Contract for Loan Guarantee Assistance, the Notes, and other related documents under such terms and conditions as the Interim City Manager or his designee shall deem in the best interest of the City, including the pledging of present and future grant funds as security for such obligations.