Minutes 06/25/2019 - Laserfiche WebLink

Home Browse Search

June 25, 2019 Discussion:  It is necessary to amend the original loan agreement between the city and the Commonwealth to take into account the additional $3,400,000 in funding.  Once the loan agreement is executed, the city will submit draw requests as appropriate to draw funds from the Commonwealth Treasury.  Repayment of the loan will commence in FY 2022. If the city’s personal property tax revenue has not increased by $1,700,000 or more between FY 2017 and FY 2021, the city’s payments will be $200,000 annually from FY 2022 through FY 2030. If the city’s personal property tax revenue has increased by $1,700,000 or more between FY 2017 and FY 2021, then annually from FY 2022 through FY 2030 the city will pay the greater of $200,000 or the amount of revenue in excess of the $1,700,000 increase. In either case, any remaining balance will be repaid in FY 2031. Financial Impact  The city will receive $1,700,000 from the Commonwealth for FY 2019 and an additional $1,700,000 for FY 2020, to be repaid as described above. Staff Recommends:  Adoption of the resolution Next Steps Following Council Action:  City Manager will sign all necessary amendments to the existing loan agreement. 1. Mark Geduldig-Yatrofsky, P. O. Box 50141, spoke in support of this item. Motion by Ms. Psimas, and seconded by Ms. Lucas-Burke, to adopt the following resolution, and was adopted by the following vote: “RESOLUTION AUTHORIZING AND RATIFYING AN AMENDMENT TO THAT CERTAIN LOAN AGREEMENT WITH THE COMMONWEALTH OF VIRGINIA DATED NOVEMBER 2017 FOR THE PURPOSE OF INCREASING THE LOAN AMOUNT. WHEREAS, by Resolution R-17-31 adopted on October 10, 2017 City Council authorized the City Manager to enter into a loan agreement for the purpose of drawing a loan in the amount of $3,400,000 from the Commonwealth of Virginia (the “Original Loan”); and WHEREAS, theOriginal Loan is an interest free loan that was authorized by the Virginia General Assembly to address the temporary loss of personal property tax revenue to the City as a result of the Virginia International Gateway lease amendment in 2016; and WHEREAS, the Original Loan included draws of $1,700,000 in both Fiscal Year 2017 and Fiscal Year 2018; and WHEREAS, the 2018 Appropriation Act adopted by the Virginia General Assembly included additional loans of $1,700,000 for Fiscal Year 2019 and $1,700,000 for Fiscal year 2020; and WHEREAS, it is therefore necessary to amend the loan agreement to increase the loan amount by $3,400,000; and WHEREAS, the additional draws on the loan will remain interest free and it is anticipated that the repayment terms will remain as stated in Resolution R-17-31; NOW THEREFORE BE IT RESOLVED by the Council of the City of Portsmouth, Virginia that the City Manager is hereby authorized to execute and deliver one or more amendments to the Loan Agreement between the City and the Commonwealth for the purpose of increasing the loan amount and providing for additional draws, and to take such further action as may be necessary or desirable in furtherance of the purpose of this Resolution.”