AGENDA #4d

 

MEMORANDUM

 

 

TO:                  Mayor and Town Council

 

FROM:            W. Calvin Horton, Town Manager

 

SUBJECT:       Calling a Public Hearing to Consider Purchase of Land for Municipal Operations                                   Facility Using Installment Contract Financing

 

DATE:             March 26, 2001

 

 

This memorandum provides information on a proposed schedule and process required for purchasing land for a municipal operations facility using installment contract financing.  This financing would require an application be submitted to and approved by the NC Local Government Commission (LGC).

 

The attached Resolution would begin this process with the Council making a preliminary determination to proceed with installment financing for this project and authorizing a public hearing on April 9 to consider the financing of this project in an amount not to exceed $900,000.

 

BACKGROUND

 

The Town has contracted to purchase land that would be used for a municipal operations facility, particularly for Public Works operations.  We recommend purchasing the property using an installment financing contract authorized by General Statue 160A-20 similar to other contracts that involve borrowing funds from private financial institutions to be repaid over a specific term.  Installment purchases for equipment over short periods of time do not require approval by the Local Government Commission; however, the purchase of land and purchases with more than 5-year payment maturities do require approval by the LGC.  Below is information on the schedule and approval process that would be required in order to complete the purchase of land for this project using an installment contract.

 

DISCUSSION AND RECOMMENDED SCHEDULE

 

For this purchase, we recommend that the Council consider an installment financing contract from private financial institutions with a term of 10 years.  Below is the process and schedule recommended by the Local Government Commission to complete the proposed purchase.  We would anticipate no problems with obtaining approval of the financing.

 

 

 

 

 

Dates                          Steps

                                                                                   

March 26                     Council makes determination to proceed with financing, calls a public hearing to consider such financing, and publishes notice of such hearing 10 days prior to hearing.

 

April 9                          Council holds public hearing on April 9, adopts resolution authorizing the filing of an application for the financing with the LGC on April 10, and authorizes staff to solicit financing proposals

                                   

April10                         Town files application with LGC and solicits financing proposals                       

 

April 24                        Council approves financing proposals with financial institution                

 

May 1                          LGC approves financing                                                                                  

 

May 7                          Council adopts resolution approving final documents and financing Terms

                                                                                                           

Before June 9               Closing and delivery of funds to Town                                                  

 

RECOMMENDATION

 

That the Council adopt the attached resolution expressing intent to use installment financing for the purchase of land for a municipal operations facility, calls for a public hearing on April 9 to consider such financing, and authorizes publication of a notice regarding the hearing.

 

 

 

A RESOLUTION CALLING A PUBLIC HEARING ON APRIL 9 TO CONSIDER THE PURCHASE OF LAND USING INSTALLMENT CONTRACT FINANCING (2001-03-26/R-4)

 

WHEREAS, the Town Council has contracted to purchase land to be used for a municipal operations facility, including the Public Works operations; and

 

WHEREAS, the Town Council wishes to consider the purchase of said land using installment financing as authorized by General Statues 160A-20 and proposes to file an application with the N. C. Local Government Commission for approval of such financing;

 

NOW, THEREFORE, BE IT RESOLVED by the Town Council of the Town of Chapel Hill that the Council hereby calls a public hearing at 7:00 p.m. on April 9 to receive comments from citizens concerning such financing, and hereby authorizes the publication of a notice of this public hearing 10 days prior to the hearing.

 

This the 26^th day of March, 2001.