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HomeMy WebLinkAboutHUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION - Loan from • , in CITY OF HUNTINGTON BEACH 2000 MAIN STREET CALIFORNIA 92648 OFFICE OF THE CITY CLERK CONNIE BROCKWAY CITY CLERK October 8, 1991 Robert B. Goodrich Chairman, HBMACF 1202 North Broadway Santa Ana, CA 92701 The City Council •of the City of Huntington Beach at the regular meeting held Monday, October 7, 1991 , approved Agreement between the City of Huntington Beach and the Huntington Beach- Municipal Art Center Foundation for financing the cost of the construction of improvements to the Huntington Beach Municipal Art Center. Enclosed is an executed copy of the agreement for your records. Connie Brockway City Clerk CB:bt Enc. (Telephone:714536-5227) AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND THE HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION FOR FINANCING THE COST OF THE CONSTRUCTION OF IMPROVEMENTS TO THE HUNTINGTON BEACH MUNICIPAL ART CENTER THIS AGREEMENT is made and entered into this 7th day of October , 1991, by and between the CITY OF HUNTINGTON BEACH, a California municipal corporation, hereinafter referred to as "CITY, " and the HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION, a California non-profit public benefit corporation, hereinafter referred to as "FOUNDATION. " WHEREAS, CITY owns that certain building located at 538 Main Street in the City of Huntington Beach, County of Orange, California, commonly known as the Huntington Beach Municipal Art Center; and CITY wishes to construct certain improvements, hereinafter referred to as the "PROJECT, " to said building; and FOUNDATION wishes to provide the finances for PROJECT, NOW, THEREFORE, in consideration of the mutual promises and agreements hereinafter made and exchanged, CITY and FOUNDATION covenant and agree as follows : 1. ESTIMATED COST OF PROJECT The estimated cost of the PROJECT is $700, 000 . 00 . The parties agree that this amount is a preliminary estimate only, and that the actual cost of PROJECT may exceed the estimated cost . 2 . PAYMENT OF ACTUAL COST OF PROJECT FOUNDATION agrees to pay to CITY all actual costs of -1- I PROJECT, whether or not the actual costs exceed the estimated cost provided in Section 1 hereinabove. 3 . DEPOSIT OF FUNDS Prior to CITY'S request for construction bids regarding PROJECT, FOUNDATION shall deposit with CITY the full amount of the estimated cost for PROJECT. Said deposit shall be in the form of a cash payment in the amount of $400, 000 . 00; and a loan from CITY to FOUNDATION in the amount of $300, 000 .00, as more fully described below. FOUNDATION agrees to deposit the cash payment of $400, 000 .00 on or before October 1, 1991. 4 . LOAN CITY agrees to lend FOUNDATION the amount of $300, 000 . 00 for PROJECT as provided in the document attached hereto as Exhibit "A, " and incorporated herein by this reference. Said loan amount shall be credited to FOUNDATION' S deposit of estimated cost as described herein. 5 . REPAYMENT OF LOAN FOUNDATION warrants and represents that its obligation to repay the loan described in Exhibit "A" is its primary financial obligation. As such, FOUNDATION covenants and agrees that all funds raised by FOUNDATION shall be applied to the loan balance until said loan has been fully and completely repaid. 6 . NOTICES Any notices or special instructions required to be given under this Agreement shall be given in writing to the parties ' authorized officers, as follows : -2- TO CITY: TO FOUNDATION: Mr . Ron Hagan Mr . Robert B . Goodrich Director of Community Services Chairman, HBMACF 2000 Main Street 1202 North Broadway Huntington Beach, CA 92648 Santa Ana, CA 92701 7 . MODIFICATION. All modification or amendments to this Agreement shall be in writing and fully executed by both parties . 8 . ENTIRETY This Agreement, and Exhibit "A" attached hereto, set forth the entire agreement between the parties . IN WITNESS WHEREOF, CITY and FOUNDATION have caused this Agreement to be executed by and through their authorized officers on the day, month and year first above written. HUNTINGTON BEACH MUNICIPAL ART CITY OF HUNTINGTON BEACH, CENTER FOUNDATION, a California a California municipal non-profit public benefit 'corpora,tion corporation \\NA 2 j President Mayor Secretary ATTEST: APPROVED AS TO FORM: et$101 # ataa"72 City Clerk G1.1 .liCity Attorney ?w c ,On4F g_a6- 1 %- it-91 REVIEWED AND APPROVED: INITI A D APPROVED: A4./L,L-A City Administrator"-47A— Direc or of Community Services -3- EXHIBIT "A" At Huntington Beach, California, on October 7 , 1991. For value received, the HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION, a California nonprofit public benefit corporation, hereinafter referred to as "FOUNDATION, " promises to pay in lawful money of the United States, to the order of the CITY OF HUNTINGTON BEACH, a California municipal corporation located at Huntington Beach, California, or its successors and assigns, hereinafter collectively referred to as "CITY, " on October 1, 1992, the principal sum of Three Hundred Thousand Dollars ($300, 000 . 00) , with interest from October 1, 1991 at the rate of Eight and One-half Percent (8 . 5%) per annum, interest to be paid at maturity. FOUNDATION hereby waives (a) presentment, demand, protest, notice of protest, notice of dishonor, and notice of nonpayment; (b) the right to the benefit of, or to direct the application of, any funds raised by FOUNDATION to pay any indebtedness other than incurred under this note, until all indebtedness of FOUNDATION to CITY under this note shall have been paid; (c) the right to require CITY to proceed against FOUNDATION, or to pursue any other remedy in CITY'S power. If FOUNDATION at any time should fail in business or become insolvent, or commit an act of bankruptcy, or if any deposit account or other property of FOUNDATION be attempted to be obtained or held by writ of execution, garnishment, attachment or other legal process, or if FOUNDATION fails to notify CITY of Page 1 of 2 any material change in its financial condition, then and in such case all of the obligation of FOUNDATION shall, at the option of CITY, become due and payable without demand or notice. HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION a California nonprofit public benefit corpo ation President ee ecretar Page 2 of 2 • /. REQUU _ FOR CITY COUNCI ACTION Date October 7, 1991 Submitted to: Honorable Mayor Green and City Council Submitted by: Michael T. Uberuaga, City Administrator Prepared by: Ronald E. Hagan, Community Services Director t PPROVED BY CITY COUNCIL Subject: LOAN TO HUNTINGTON BEACH ART CENTER FOUNDATION "0-�-�,�,7 ig1L 41, Consistent with Council Policy? [ I Yes [ ] New Policy or Exception ¢ cr.,i C Statement of Issue, Recommendation, Analysis, Funding Source, Alternative Actions, Attachments: 2( STATEMENT OF ISSUE There is a need to provide a loan to the Huntington Beach Art Center Foundation of $300,000 to provide the necessary funds to begin the remodeling of the property at 538 Main Street for the Huntington Beach Art Center. RECOMMENDATION Approve the agreement between the city and the Huntington Beach Municipal Art Center Foundation to provide short term financial assistance with the cost of the construction of the improvements, and direct staff to appropriate necessary funds. ANALYSIS At the June 3, 1991 study session, Council directed staff to prepare a loan agreement that would enable the Foundation to proceed with its efforts to complete the Art Center project in a timely manner. The loan would provide the remaining portion ( $300,000) of the funds necessary to complete the project. The Foundation agrees to deposit a cash payment of $400,000 on or before November 1 , 1991 with the city. The Foundation agrees to pay the loan back on or before November 1 , 1992, with interest from October 1 , 1991 at a rate of eight and one-half percent (8.5%) per annum, interest to be paid at maturity. The Foundation expects to have the remaining portion of the monies pledged by July 1 , 1992, just prior to completion of the reconstruction. With the Council ' s approval of the agreement, staff will proceed with the project by initiating the bid process. It is expected to take six to eight months to complete the remodeling. FUNDING SOURCE ro T Capital Improvement Project Fund r x rn ALTERNATIVE ACTION c_o m Deny request for loan. r- rn p ATTACHMENTS = " Loan agreement ca Fiscal Impact Statement V\ RH:MM:cjg (etV: / 2137E/4 PI 4/84 CITY OF HUNTINGTON BEACH COI INTER-DEPARTMENT COMMUNICATION HUNTINGTON BEACH To MICHAEL T. UBERUAGA From ROBERT J. FRANZ City Administrator Deputy City Administrator Subject REQUESTED FUNDING TO Date SEPTEMBER 27, 1991 FACILITATE REMODELING OF THE CITY'S ART CENTER FIS 91-34 As required under the authority of Resolution 4832, a Fiscal Impact Statement has been prepared and submitted relative to the request for interim financing to assist in the remodeling of the property that has been designated as the site for the Huntington Beach Municipal Art Center. An appropriation of $300,000 would be adequate for this project. Upon approval of the City Council , the balance of the unaudited, undesignated Capital Improvements Fund would be reduced to $501 ,754 prior to the repayment of these monies by the Huntington Beach Munici Art Center oundation. ERT J. FRANZ Deputy City Administrato RJF:AR:skd WPADSERT:577 / ('\ To MICHAEL T. UBERUAGA From ROBERT J FRANZ City Administrator Deputy City Ad Subject REQUESTED FUNDING TO Date Sept. 26, 1991 FACILITATE REMODELING OF THE CITY'S ART CENTER F. I.S. 91-34 As required under the authority of Resolution 4832 , a Fiscal Impact Statement has been prepared and submitted relative to the request for interim financing to assist in the remodeling of the property that has been designated as the site for the Huntington Beach Municipal Art Center. An appropriation of $300, 000 would be adequate for this project. Upon approval of the City Council, the balance of the unaudited, undesignated Capital Improvements Fund would be reduced to $501, 754 , prior to the repayment of these monies by the Hunt- ington Beach Municipal Art Center Foundation. i \/[ / ' (t.----- 1 i/ ( // r ROBERT J. FRANZ Deputy City Admin. ,7i, ., r Sept. 25, 1991 FISCAL IMPACT STATEMENT Why is this item not in the budget? The allocation was not appropriated in the 1991/92 budget because the City Council did not consider the possibility of a loan until June, 1991. At the June 3 study session, Council directed staff to prepare the necessary loan documents. II. What will be the cost? A loan of $300,000 will be granted to the Huntington Beach Art Center Foundation to be paid back to the city by November 1, 1992 with interest from November 1, 1991 at a rate of eight and one-half percent (8.5%) per annum with the interest to be paid at maturity. There will be no future cost as a result of this loan. The indirect costs are minimal other than the administration of the loan. III. Funding Source According to Administrative Services, the loan will be provided through the Capital Improvements Projects Fund. IV. History The renovation project for the Huntington Beach Art Center is part of the city's Capital Improvement Project Program. The city acquired the property at 538 Main Street for the purpose of the Huntington Beach Art Center. The Foundation, an adjunct of the city of Huntington Beach, is responsible for raising all the monies necessary for the reconstruction estimated to cost $700,000. To date, the Huntington Beach Art Center Foundation has raised over $425,000 and expects to secure the remaining monies by August of 1992 and deposit with the city by the deadline of November 1, 1992. The loan monies are not expected to be withdrawn from the city's account given that the Foundation anticipates having all the necessary funds for the construction in place before the reconstruction is completed. The City Council and Huntington Beach Art Center Foundation agreed to proceed in a timely manner to complete the project without further delay. The loan will allow the city to begin the construction process while the Foundation completes its fundraising efforts. 2162E REQUES u I=OR CITY COUNCIL ACTION Date October 7, 1991 Submitted to: Honorable Mayor Green and City Council Submitted by: Michael T. Uberuaga, City Administrator Prepared by: Ronald E. Hagan, Community Services DirectorGN Subject: LOAN TO HUNTINGTON BEACH ART CENTER FOUNDATION Consistent with Council Policy? [ ] Yes [ ] New Policy or Exception Statement of Issue, Recommendation,Analysis, Funding Source,Alternative Actions,Attachments: STATEMENT OF ISSUE There is a need to provide a loan to the Huntington Beach Art Center Foundation of $300,000 to provide the necessary funds to begin the remodeling of the property at 538 Main Street for the Huntington Beach Art Center. RECOMMENDATION Approve the agreement between the city and the Huntington Beach Municipal Art Center Foundation to provide short term financial assistance with the cost of the construction of the improvements, and direct staff to appropriate necessary funds. ANALYSIS At the June 3, 1991 study session, Council directed staff to prepare a loan agreement that would enable the Foundation to proceed with its efforts to complete the Art Center project in a timely manner. The loan would provide the remaining portion ($300,000) of the funds necessary to complete the project. The Foundation agrees to deposit a cash payment of $400,000 on or before November 1 , 1991 with the city. The Foundation agrees to pay the loan back on or before November 1 , 1992, with interest from October 1 , 1991 at a rate of eight and one-half percent (8.5%) per annum, interest to be paid at maturity. The Foundation expects to have the remaining portion of the monies pledged by July 1 , 1992, just prior to completion of the reconstruction. With the Council 's approval of the agreement, staff will proceed with the project by initiating the bid process. It is expected to take six to eight months to complete the remodeling. FUNDING SOURCE Capital Improvement Project Fund ALTERNATIVE ACTION Deny request for loan. ATTACHMENTS Loan agreement Fiscal Impact Statement RH:MM:cjg 2137E/4 AGREEMENT BETWEEN THE CITY OF HUNTINGTON BEACH AND THE HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION FOR FINANCING THE COST OF THE CONSTRUCTION OF IMPROVEMENTS TO THE HUNTINGTON BEACH MUNICIPAL ART CENTER THIS AGREEMENT is made and entered into this day of , 1991, by and between the CITY OF HUNTINGTON BEACH, a California municipal corporation, hereinafter referred to as "CITY, " and the HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION, a California non-profit public benefit corporation, hereinafter referred to as "FOUNDATION. " WHEREAS, CITY owns that certain building located at 538 Main Street in the City of Huntington Beach, County of Orange, California, commonly known as the Huntington Beach Municipal Art Center; and CITY wishes to construct certain improvements, hereinafter referred to as the "PROJECT, " to said building; and FOUNDATION wishes to provide the finances for PROJECT, NOW, THEREFORE, in consideration of the mutual promises and agreements hereinafter made and exchanged, CITY and FOUNDATION covenant and agree as follows : 1. ESTIMATED COST OF PROJECT The estimated cost of the PROJECT is $700, 000 . 00 . The parties agree that this amount is a preliminary estimate only, and that the actual cost of PROJECT may exceed the estimated cost . 2 . PAYMENT OF ACTUAL COST OF PROJECT FOUNDATION agrees to pay to CITY all actual costs of -1- PROJECT, whether or not the actual costs exceed the estimated cost provided in Section 1 hereinabove. 3 . DEPOSIT OF FUNDS Prior to CITY' S request for construction bids regarding PROJECT, FOUNDATION shall deposit with CITY the full amount of the estimated cost for PROJECT. Said deposit shall be in the form of a cash payment in the amount of $400, 000 . 00; and a loan from CITY to FOUNDATION in the amount of $300, 000 . 00, as more fully described below. FOUNDATION agrees to deposit the cash payment of $400, 000 . 00 on or before October 1, 1991. 4 . LOAN CITY agrees to lend FOUNDATION the amount of $300, 000 . 00 for PROJECT as provided in the document attached hereto as Exhibit "A, " and incorporated herein by this reference. Said loan amount shall be credited to FOUNDATION' S deposit of estimated cost as described herein. 5 . REPAYMENT OF LOAN FOUNDATION warrants and represents that its obligation to repay the loan described in Exhibit "A" is its primary financial obligation. As such, FOUNDATION covenants and agrees that all funds raised by FOUNDATION shall be applied to the loan balance until said loan has been fully and completely repaid. 6 . NOTICES Any notices or special instructions required to be given under this Agreement shall be given in writing to the parties ' authorized officers, as follows : -2- EXHIBIT "A" At Huntington Beach, California, on , 1991. For value received, the HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION, a California nonprofit public benefit corporation, hereinafter referred to as "FOUNDATION, " promises to pay in lawful money of the United States, to the order of the CITY OF HUNTINGTON BEACH, a California municipal corporation located at Huntington Beach, California, or its successors and assigns, hereinafter collectively referred to as "CITY, " on October 1, 1992, the principal sum of Three Hundred Thousand Dollars ($300 , 000 . 00) , with interest from October 1, 1991 at the rate of Eight and One-half Percent (8 . 5%) per annum, interest to be paid at maturity. FOUNDATION hereby waives (a) presentment, demand, protest, notice of protest, notice of dishonor, and notice of nonpayment; (b) the right to the benefit of, or to direct the application of, any funds raised by FOUNDATION to pay any indebtedness other than incurred under this note, until all indebtedness of FOUNDATION to CITY under this note shall have been paid; (c) the right to require CITY to proceed against FOUNDATION, or to pursue any other remedy in CITY' S power . If FOUNDATION at any time should fail in business or become insolvent, or commit an act of bankruptcy, or if any deposit account or other property of FOUNDATION be attempted to be obtained or held by writ of execution, garnishment, attachment or other legal process, or if FOUNDATION fails to notify CITY of Page 1 of 2 • 1 ' any material change in its financial condition, then and in such case all of the obligation of FOUNDATION shall, at the option of CITY, become due and payable without demand or notice. HUNTINGTON BEACH MUNICIPAL ART CENTER FOUNDATION a California nonprofit public benefit corporation President Secretary Page 2 of 2 TO CITY: TO FOUNDATION: Mr. Ron Hagan Mr . Robert B. Goodrich Director of Community Services Chairman, HBMACF 2000 Main Street 1202 North Broadway Huntington Beach, CA 92648 Santa Ana, CA 92701 7 . MODIFICATION. All modification or amendments to this Agreement shall be in writing and fully executed by both parties . 8 . ENTIRETY This Agreement, and Exhibit "A" attached hereto, set forth the entire agreement between the parties . IN WITNESS WHEREOF, CITY and FOUNDATION have caused this Agreement to be executed by and through their authorized officers on the day, month and year first above written. HUNTINGTON BEACH MUNICIPAL ART CITY OF HUNTINGTON BEACH, CENTER FOUNDATION, a California a California municipal non-profit public benefit corporation corporation President Mayor Secretary ATTEST: APPROVED AS TO FORM: City Clerk G14 k).,Dtt.w,4NiCity Attorney Ti,..Q REVIEWED AND APPROVED: INITIATED AND APPROVED: City Administrator Director of Community Services -3- ipM1' r ' CAPITAL IMPROVEMENT FUND (As of 9/26/91) Adjusted, unaudited Fund Balance thru June 30, 1991 6, 557,881 Plus: 1991/92 Anticipated Revenues 1 600 000 Less: 1991/92 Revised Appropriations 7, 356, 127 F. I. S. 91-34 Loan For Art Center 300, 000 Adjusted Capital Improvement Fund at 9/26/91 501, 754