DEPARTMENT: Finance
DEPARTMENT HEAD: Troy Elliott
COUNCIL DISTRICTS IMPACTED: City-wide
SUBJECT:
Defeasance of HUD Loan related to the Port Authority of San Antonio
SUMMARY:
This Ordinance authorizes the City to take all actions necessary to defease two outstanding bonds issued in 2010 by the City to the U.S. Department of Housing and Urban Development in connection with providing financial assistance to the Port Authority of San Antonio including approving and authorizing the execution of an Escrow Agreement related to such defeasance.
BACKGROUND INFORMATION:
In July, 2010, the City issued and delivered two bonds to the United States Department of Housing and Urban Development ("HUD"), one in the original principal amount of $9,730,000 and the other in the original principal amount of $2,425,000, (together, the "2010 Bonds") the proceeds of which were used to refund, in order to achieve interest cost savings, two loans previously issued by HUD to the City to provide funds to support the redevelopment of the former Kelly Air Force Base (the "HUD 108 Loan").
On August 21, 2014, City Council approved the restructuring of the terms of the Agreement to Pledge Structural Reserve Funds which was entered into by the City and the Port Authority of San Antonio (the "Port") as a requirement for the funding provided by the HUD 108 Loan. The restructuring allowed for the Structural Reserve Funds to be utilized by the Port and approved the redirection of $3.7 million in funding that the City had budgeted for infrastructure improvements at the Port to be applied to the Port's payments to the City for the HUD 108 Loan. The City recommended both of these actions in response to a request by the Port for assistance and cash flow flexibility.
ISSUE:
The Port recently notified the City that it is in the process of refinancing a portion of their outstanding debt and desires to pledge all or a portion of its property which is current...
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