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<br />May 27.2008
<br />
<br />Discussion:
<br />. Construction of the hotel is to commence on or before July 31, 2008. It shall be
<br />made ready for business by April 30, 2009. These stipulations are in accordance with
<br />the License Agreement. At a minimum it will be 5-story building, hosting 120 keys, a
<br />restaurant and limited conferencing area.
<br />
<br />Financial Impact:
<br />. See Fiscal Impact Statements Attached.
<br />
<br />Staff Recommends:
<br />. Adoption of resolution. Vision Principle: A Robust and Prospering Economy.
<br />
<br />Next Steps Following Council Action:
<br />. Issuance of Land Disturbance and Building permits.
<br />
<br />1. William Nausbaum, 1700 Dominion Tower, Norfolk, spoke in support of this item.
<br />
<br />Motion by Ms. Psi mas, and seconded by Mr. Moody, to adopt the following
<br />resolution, and was adopted by the following vote:
<br />
<br />"RESOLUTION APPROVING THE EXERCISE BY THE ECONOMIC DEVELOPMENT
<br />AUTHORITY OF THE CITY OF PORTSMOUTH, VIRGINIA OF POWERS
<br />CONFERRED BY THE INDUSTRIAL DEVELOPMENT AND REVENUE BOND ACT,
<br />IN CONJUNCTION WITH THE ISSUANCE FOR OLD TOWNE HOSPITALITY, L.L.C.,
<br />A VIRGINIA LIMITED LIABILITY COMPANY, OF NOT TO EXCEED $12,000,000 OF
<br />THE AUTHORITY'S NEW EMPOWERMENT ZONE FACILITY REVENUE BONDS TO
<br />FINANCE A PORTION OF (1) THE COST OF A 120 ROOM HOLIDAY INN AND
<br />SUITES HOTEL, (2) A DEBT SERVICE RESERVE FUND, (3) CAPITALIZED
<br />INTEREST, AND (4) THE COSTS OF ISSUING SUCH BONDS AND DESIGNATING
<br />THEM AS NEW EMPOWERMENT ZONE FACILITY BONDS FOR PURPOSES OF
<br />SECTION 1394(f)(2)(A) OF THE INTERNAL REVENUE CODE OF 1986, AS
<br />AMENDED.
<br />
<br />WHEREAS, the Industrial Development and Revenue Bond Act, Chapter 49,
<br />Title 15.2 of the Code of Virginia, as amended (the "Act"), authorizes the creation of the
<br />Economic Development Authority of the City of Portsmouth, Virginia (the "Authority"),
<br />this Council has created the Authority, and the Act empowers the Authority to assist Old
<br />Towne Hospitality, L.L.C., a Virginia limited liability company (the "Applicant"), by the
<br />issuance of not to exceed $12,000,000 of its new empowerment zone facility revenue
<br />bonds (the "Bonds") to finance a portion of (1) the costs of a 120-room Holiday Inn and
<br />Suites Hotel, to be located on an approximately 2.5 acre parcel of land at the southwest
<br />corner of Port Centre Parkway and Crawford Connector South, in the City of
<br />Portsmouth, Virginia (the "Project"), (2) a debt service reserve fund, (3) capitalized
<br />interest, and (4) the costs of issuing such Bonds; and
<br />
<br />WHEREAS, the Applicant, which will own the Project, has its present principal
<br />place of business at 825 Greenbrier Circle, Suite F, Chesapeake, VA 23320; and
<br />
<br />WHEREAS, Section 147(f) of the Internal Revenue Code of 1986, as amended
<br />(the "Code"), requires approval by this Council of the issuance of any private activity
<br />bonds by the Authority after the Authority has held a public hearing to consider the
<br />issuance of such bonds as one of the acts required in order for the interest on such
<br />bonds to qualify for exemption from the imposition of federal income tax; and
<br />
<br />WHEREAS, the Project is located in the 10 square mile area of the City of
<br />Portsmouth, Virginia ("Portsmouth") and the City of Norfolk, Virginia ("Norfolk") which has
<br />been designated an empowerment zone under Section 1391 (g) of the Code;
<br />
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