2010-73 AMENDING ORDINANCE 77-33, SETTING FOR THE DETERMINATION OF THE COUNCIL TO ASSIST HOSPITALS

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DEVELOPMENT SERVICES MEMORANDUM Memo No. 10-89 October 18, 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 ordinances authorizing the execution and delivery of a Memorandum of Agreement between DMH and the City of Decatur pertaining to the issuance of$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. The attached ordinance will further amend to authorize the City to issue Hospital Facility Revenue Bonds for the purposes of financing in whole or in part the cost of the acquisition, purchase, construction, reconstruction, improvement, equipping, betterment or extension of a hospital, or other health care facility located in the City, to redeem, retire or otherwise pay any outstanding indebtedness of a hospital and of refunding bonds previously issued pursuant to the Enabling Ordinance. 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 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 this Memorandum of Agreement and the performance by the City of its obligations hereunder POTENTIAL OBJECTION: None. INPUT FROM OTHER SOURCES: The ordinances and agreement 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