2010-76 AUTHORIZING ISSUANCE OF HOSPITAL FACILITY REVENUE BONDS

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DEVELOPMENT SERVICES MEMORANDUM Memo No. 10-95 October 25, 2010 TO: Honorable Mayor Michael T. McElroy and City Council FROM: Ryan P. McCrady, City Manager Greg C. Crowe, Assistant City Manager SUBJECT: 2010 DMH Bond Issue SUMMARY RECOMMENDATION: Staff recommends approval of the attached ordinance authorizing the City of Decatur to issue $21,000,000 in Hospital Facility Revenue Bonds. BACKGROUND: On April 4, 1997 the City Council approved an Ordinance setting forth the determination that it is in the public interest to assist hospitals serving residents of the City in financing hospital facilities, and prescribing the procedures to be followed in the issuance of Hospital Facility Revenue Bonds by the City. That ordinance has been amended by Council on April 4, 1998 and October 21, 2010. These Bonds shall be limited obligations of the City payable solely out of the revenues and receipts derived from payments to be made by the Hospital; no holder of the Bonds shall have the right to compel any exercise of the taxing power of the City and the Bonds shall not constitute an indebtedness or a loan of credit of the City. The Memorandum of Agreement approved by Council on October 21, 2010 spells out the terms of which the Hospital will obligate itself to pay to or on behalf of the City an amount sufficient to pay the principal of and interest. Also, the Hospital will reimburse the City for, or pay reasonable expenses, including all reasonable attorneys' fees and expenses, which the City may incur arising from the execution of the Memorandum of Agreement and the performance by the City of its obligations hereunder POTENTIAL OBJECTION: None. INPUT FROM OTHER SOURCES: The ordinance has been reviewed by the City Corporation Counsel as well as Chapman& Cutler, the City's Bond Counsel. STAFF REFERENCE: Any additional questions may be forwarded to Greg Crowe at 424-2727 or at gcrowe@decaturil.gov. BUDGET/TIME IMPLICATIONS: None