Cleveland City Council

p. 404 REGULAR SESSION MAY 22, 2017 3:00 P.M. MINUTE BOOK 28 BE IT REMEMBERED THAT THE CITY COUNCIL OF THE CITY OF CLEVELAND, TENNESSEE MET IN A REGULAR SESSION THIS MONDAY, MAY 22, 2017 AT 3:00 P.M. AT THEIR REGULAR MEETING PLACE IN THE CLEVELAND MUNICIPAL BUILDING. Present and presiding was Mayor Tom Rowland. Also present were Vice Mayor Avery Johnson, Councilmen Charlie McKenzie, Bill Estes, Tom Cassada, David May, Jr., Dale Hughes and Richard Banks. Others in attendance according to the sign-in sheet were as follows: City Manager Joe Fivas; Assistant City Manager/CFO Shawn McKay; Assistant City Manager/Operations Melinda Carroll; City Attorney John Kimball; Christy Bryant, Support Services Manager, Fire Chief Ron Harrison; Jonathan Jobe, Director of Development and Engineering Services; Tommy Myers, Director of Public Works; Police Chief Mark Gibson; Mark Fidler, Jetport Director; Dan Hartman, Assistant Director of Parks and Recreation; Jeff Davis, Personnel Director, Kris Miller, IT Director; Brian Moran, Social Media Coordinator; Kim Spence, Safety and Wellness Manager; Bethany McCoy with Lee University; City Reporter Randall Higgins; Jonathan Carroll; Marshall Stinnett, Walt Vineyard and Tad Bacon with Cleveland Utilities; Teresa Torbett, CDBG Coordinator; Doug Berry and Gary Farlow with the Chamber of Commerce; School Board Member Dawn Robinson; Larry Bowers with the Cleveland Daily Banner. Following the Pledge of Allegiance to the American Flag and prayer by Vice Mayor Johnson the following business was then entered into: WAIVE READING OF MINUTES Vice Mayor Johnson moved that the City Council of the City of Cleveland waive the reading of the minutes of the Regular Session of the City Council held on May 8, 2017 and approve them as written. The motion was seconded by Councilman May; and upon roll call the motion unanimously passed. PRESENTATIONS, PETITIONS AND COMMUNICATIONS FROM MAIL Mayor Rowland stated today’s meeting is being held as a public hearing to hear public comments concerning the FY2018 Budget. Mayor Rowland asked if anyone would like to speak in favor of the approval of the budget. No one spoke. Mayor Rowland asked if anyone would like to speak in opposition of the approval of the budget. No one spoke. Mayor Rowland then read the following Proclamation for Public Works Week. “N A T I O N A L P U B L I C W O R K S W E E K” Whereas, public works services provided in our community are an integral part of our citizens’ everyday lives; and . . . . Whereas, the support of an understanding and informed citizenry is vital to the efficient operation of public works systems and programs such as water, sewers, streets and highways, public buildings, and solid waste collection; and . . . . Whereas, the health, safety and comfort of this community greatly depends on these facilities and services; and . . . . Whereas, the quality and effectiveness of these facilities, as well as their planning, design, and construction, are vitally dependent upon the efforts and skill of public works officials; and . . . . Whereas, the efficiency of the qualified and dedicated personnel who staff public works departments is materially influenced by the people’s attitude and understanding of the importance of the work they perform, p. 405 REGULAR SESSION MAY 22, 2017 PAGE -2- MINUTE BOOK 28 NOW THEREFORE, I, Tom Rowland, Mayor of the City of Cleveland, Tennessee do hereby proclaim the week of May 21-27, 2017 as National Public Works Week” in the City of Cleveland and call upon all citizens and civic organizations to acquaint themselves with the issues involved in providing our public works and to recognize the contributions which public works officials make every day to our health, safety, comfort, and quality of life. CONSENT AGENDA Mayor Rowland reviewed the items on the consent agenda. • Final Passage - Ordinance No: 2017-16 - Amending section 3.1.B of the Zoning Regulations to create provisions which allow for review and approval for greater densities of development on properties which are allowed to be developed to the R3 Multi-Family Residential Zoning District standards (Planning Commission: Approved; 9-0). • Final Passage - Ordinance No: 2017-18 – Adopting the FY2018 Budget. • Resolution No: 2017-24 – Authorizing the Mayor to sign the FY2018 TDOT Highway Maintenance contract. RESOLUTION NO: 2017-24 WHEREAS, the State of Tennessee Department of Transportation has submitted the attached contract for maintenance of State Highways through the City of Cleveland, Tennessee, to the City Council of the City of Cleveland for the purpose of providing for approval of said Contract; and WHEREAS, the City Council of the City of Cleveland desires to approve said Contract. NOW, THEREFORE, BE IT RESOLVED that the Mayor be, and hereby is, authorized to sign the Contract on behalf of the City of Cleveland. [On file in the City Clerk’s Office.] Adopted this 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk • Resolution No: 2017-25 – Authorizing the Mayor to sign a letter of engagement and a contract with Arnett, Kirksey, Kimsey, Sullivan, Lay & Hall to audit accounts of the City of Cleveland for the period July 1, 2016 through June 30, 2017. RESOLUTION NO: 2017-25 A RESOLUTION AUTHORIZING AN ENGAGEMENT LETTER AND A CONTRACT WITH ARNETT, KIRKSEY, KIMSEY, SULLIVAN, LAY & HALL, PLLC TO AUDIT THE ACCOUNTS OF THE CITY OF CLEVELAND, TENNESSEE WHEREAS, the City of Cleveland has received a proposal from the Certified Public Accounting firm of Arnett, Kirksey, Kimsey, Sullivan, Lay & Hall, PLLC, to audit the accounts for the period from July 1, 2016, through June 30, 2017, with a fee of $49,000.00; and p. 406 REGULAR SESSION MAY 22, 2017 PAGE -3- MINUTE BOOK 28 WHEREAS, the City Council desires to enter into an engagement letter and a contract with Arnett, Kirksey, Kimsey, Sullivan, Lay & Hall, PLLC, and to further authorize the Mayor to execute the required engagement letter and the attached contract on behalf of the City of Cleveland. [On file in the City Clerk’s Office.] BE IT THEREFORE RESOLVED by the City Council of the City of Cleveland, Tennessee that the Mayor be, and hereby is, authorized to sign the engagement letter and contract and all other necessary forms for said audit on behalf of the City of Cleveland for the above referenced contract. Adopted this 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk • Resolution No: 2017-26 – Approving the FY2018 Appropriations. RESOLUTION NO: 2017-26 CITY OF CLEVELAND APPROPRIATION RESOLUTION WHEREAS, the City of Cleveland recognizes that its citizens have various needs which must be addressed; and WHEREAS, the municipal government has neither the expertise or manpower to assist its citizens with all their special needs; and WHEREAS, several not-for-profit organizations have been established over the years to help the citizens with their special needs; and WHEREAS, the enclosed organizations have demonstrated, through their financial statements and by reputation, to be of service in enhancing the quality of life in this area; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Cleveland, Tennessee that these contributions be made for FY 2017-2018: Adopted this 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk p. 407 REGULAR SESSION MAY 22, 2017 PAGE -4- MINUTE BOOK 28 • Resolution No: 2017-27 – Directing the payment by the Cleveland Utilities Board to the City of Cleveland Tax Equivalent Payment for the Cleveland Utilities Board’s Electric System. RESOLUTION NO: 2017-27 A RESOLUTION DIRECTING THE PAYMENT BY THE CLEVELAND UTILITIES BOARD TO THE CITY OF CLEVELAND TAX EQUIVALENT PAYMENTS FOR THE CLEVELAND UTILITIES BOARD’S ELECTRIC SYSTEM WHEREAS, section 7-52-304 of the Tennessee Code annotated empowers a municipality’s governing body, after consultation with the supervisory body of an electric system, to determine the amounts of tax equivalents to be paid to the taxing jurisdiction (municipality) in the service area of the electric system; and WHEREAS, the City Council of the City of Cleveland, through its City Manager and Finance Director, has held such consultation with the supervisory body of the electric system of the City of Cleveland; and WHEREAS, the necessary calculations of tax equivalents payable have been made in accordance with the provisions of Tennessee Code annotated Section 7-52-304; p. 408 REGULAR SESSION MAY 22, 2017 PAGE -5- MINUTE BOOK 28 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CLEVELAND; Section 1. The Cleveland Utilities Board electric system is hereby directed to pay to the City of Cleveland $2,065,242 in tax equivalents for FY2018. Section 2. This resolution shall become effective July 1, 2017 the public welfare requiring it. Adopted this 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk • Resolution No: 2017-28 - Directing the payment by the Cleveland Utilities Board to the City of Cleveland Tax Equivalent Payment for the Cleveland Utilities Board’s Water System. RESOLUTION NO: 2017-28 A RESOLUTION DIRECTING THE PAYMENT BY THE CLEVELAND UTILITIES BOARD TO THE CITY OF CLEVELAND TAX EQUIVALENT PAYMENTS FOR THE CLEVELAND UTILITIES BOARD’S WATER SYSTEM. WHEREAS, section 7-34-115 of the Tennessee Code annotated empowers a municipality’s governing body, after consultation with the supervisory body of a water system, to determine the amounts of tax equivalents to be paid to the taxing jurisdiction (municipality) in the service area of the water system; and WHEREAS, the City Council of the City of Cleveland, through its City Manager and Finance Director, has held such consultation with the supervisory body of the water system of the City of Cleveland; and WHEREAS, the necessary calculations of tax equivalents payable have been made in accordance with the provisions of Tennessee Code annotated Section 7-34-115; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CLEVELAND; Section 1. The Cleveland Utilities Board water and wastewater system is hereby directed to pay to the City of Cleveland $231,900 in tax equivalents for FY2018. Section 2. This resolution shall become effective July 1, 2017 the public welfare requiring it. Adopted this 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk p. 409 REGULAR SESSION MAY 22, 2017 PAGE -6- MINUTE BOOK 28 • Resolution No: 2017-29 – Directing the payment by the Cleveland Utilities Board to the City of Cleveland Tax Equivalent Payment for the Cleveland Utilities Board’s Wastewater System. RESOLUTION NO: 2017-29 A RESOLUTION DIRECTING THE PAYMENT BY THE CLEVELAND UTILITIES BOARD TO THE CITY OF CLEVELAND TAX EQUIVALENT PAYMENTS FOR THE CLEVELAND UTILITIES BOARD’S WASTEWATER SYSTEM. WHEREAS, section 7-34-115 of the Tennessee Code annotated empowers a municipality’s governing body, after consultation with the supervisory body of a wastewater system, to determine the amounts of tax equivalents to be paid to the taxing jurisdiction (municipality) in the service area of the water system; and WHEREAS, the City Council of the City of Cleveland, through its City Manager and Finance Director, has held such consultation with the supervisory body of the wastewater system of the City of Cleveland; and WHEREAS, the necessary calculations of tax equivalents payable have been made in accordance with the provisions of Tennessee Code annotated Section 7-34-115; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CLEVELAND; Section 1. The Cleveland Utilities Board wastewater system is hereby directed to pay to the City of Cleveland $212,180 in tax equivalents for FY2018. Section 2. This resolution shall become effective July 1, 2017 the public welfare requiring it. Adopted this 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk • Resolution No: 2017-30 – Regarding the Cleveland City Schools Federal Project Fund. RESOLUTION NO: 2017-30 A RESOLUTION REGARDING THE CLEVELAND CITY SCHOOLS FEDERAL PROJECT FUND THAT WHEREAS, the Cleveland City Schools receive monies from the federal government to assist with the educational programs of the local school system; and NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Cleveland, Tennessee in regular session assembled this 22nd day of May, 2017, as follows: p. 410 REGULAR SESSION MAY 22, 2017 PAGE -7- MINUTE BOOK 28 Section 1. That the Cleveland City Schools General Fund is hereby approved, and the budget for the Cleveland City Schools Federal Project Fund shall be the budget for the separate projects approved within the fund by the Tennessee Department of Education and for the No Child Left Behind projects as approved by the Cleveland Board of Education. Section 2. That a certified copy of this Resolution shall be furnished to the Director of Schools to forward to the Tennessee Department of Education as proof of compliance with its regulations regarding federal project funds. Section 3. That this Resolution shall be and remain in full force and effect from and after its date of adoption. Passed and adopted this 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk • Resolution No: 2017-34 – Adopting the City’s Public Records Policy. RESOLUTION NO: 2017-34 A RESOLUTION AUTHORIZING A PUBLIC RECORDS POLICY FOR THE CITY OF CLEVELAND WHEREAS, the Tennessee Comptroller of the Treasury has issued provisions regarding the establishment of a public records; and WHEREAS, the policy must be approved by July 1, 2017 by the City Council; and WHEREAS, the attached policy has been prepared to meet the needs of the City and to meet the standards issued by the Office of Open Records Counsel; and NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Cleveland, Tennessee does hereby adopt the attached public records policy and will review it on an annual basis for any necessary changes or modifications. Approved 22nd day of May, 2017. /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk • Resolution No: 2017-35 – Authorizing the Mayor to sign a subscription agreement with Siteimprove, Inc., to assist staff with the City’s website. p. 411 REGULAR SESSION MAY 22, 2017 PAGE -8- MINUTE BOOK 28 RESOLUTION NO. 2017-35 WHEREAS, the City has received the attached subscription agreement from Siteimprove, Inc. and WHEREAS, the City desires to enter into this agreement because the software program will assist city staff in managing the City’s website to help locate broken links, ADA accessibility, readability and other issues; and WHEREAS, the City Council has reviewed the subscription agreement and now desires to accept the agreement and to enter into the attached agreement with Siteimprove, Inc., and to further authorize the Mayor to execute the same on behalf of the City of Cleveland. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Cleveland, Tennessee, in regular session assembled, that the City Council does hereby accept and approve of the attached agreement with Siteimprove, Inc., and it further authorizes the Mayor to execute the agreement on behalf of the City of Cleveland. This 22nd day of May, 2017 /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk • Motion – Designating Depositories for the City of Cleveland (Mayor Rowland and Councilman McKenzie announced they were stock holders at Bank of Cleveland). ANDREW JOHNSON BANK ATHENS FEDERAL COMMUNITY BANK BANK OF CLEVELAND BB&T BANK BOWATER CREDIT UNION FIRST TENNESSEE BANK SMART BANK (FSG BANK) PINNACLE BANK REGIONS BANK SOUTHEAST BANK AND TRUST SOUTHERN HERITAGE BANK SUNTRUST BANK TENNESSEE VALLEY FEDERAL CREDIT UNION UNITED COMMUNITY BANK • Bid Report – Greenway Stage - Sound and Lighting Equipment BID SUMMARY SOUND & LIGHTING EQUIPMENT FOR THE CITY OF CLEVELAND April 19, 2017 1. Bradley Services Cleveland, TN No Bid 2. SB Electric Cleveland, TN No Bid p. 412 REGULAR SESSION MAY 22, 2017 PAGE -9- MINUTE BOOK 28 3. Stage AVL Cleveland, TN $42,881.00 Recommendation is to accept the bid from Stage AVL of Cleveland, TN with a bid of $42,881.00. This project is funded 70/30 by a Tourism Enhancement Grant. The Grant is for $65,000 with the State funding $45,500 and the City funding $19,500.00. This will provide sound equipment and lighting as well as a storage area located on the Stage at Greenway Park. Committee Recommendation: Stage AVL Assistant City Manager’s Approval: Melinda B. Carroll Department Head’s Approval: Patti Petitt Councilman Banks moved to approve the Consent Agenda. The motion was seconded by Vice Mayor Johnson; and upon roll call, the motion to approve the consent agenda unanimously passed. REPORTS OF MAYOR AND COUNCIL MEMBERS Councilman Hughes congratulated Walt Vineyard on his promotion with Cleveland Utilities to Executive Vice President, IT and Customer Connection. Councilman Banks stated Mayor Rowland was recognized last week at the unveiling of the Tom Rowland Interchange. As suggested before, we should have a convention center in the old Whirlpool site and name it the Tom Rowland Convention Center for his service to the City of Cleveland. Councilman McKenzie asked if they poured walls for the new fire hall would that money. Mayor Rowland stated once the bid is approved staff will negotiate with the contractor and see if that’s something that could be done. Councilman McKenzie continued that we have buildings and houses in town that are abandoned and falling down. He is told no one can go into check them because the doors are locked. He suggested something be done to change the Code to help with the situation. NEW BUSINESS AND ORDINANCES The following bid summary was presented for Fire Hall #6. BID SUMMARY FIRE HALL #6 2190 WESTLAND DRIVE, S.W. CLEVELAND FIRE DEPARTMENT MAY 2, 2017 1. Hickory Construction Alcoa, TN $2,145,000.00 2. K & F Construction Knoxville, TN $2,165,000.00 3. Cherokee Construction Cleveland, TN $2,307,951.00 p. 413 REGULAR SESSION MAY 22, 2017 PAGE -10- MINUTE BOOK 28 4. Evans-Ailey Construction Clinton, TN $2,338,700.00 5. P & C Construction Chattanooga, TN $2,350,000.00 6. Frizzell Construction Bristol, TN No Bid Recommendation is to accept Hickory Construction of Alcoa, TN and to negotiate a lower bid. Committee Recommendation: Hickory Construction Assistant City Manager’s Approval: Melinda B. Carroll Department Head’s Approval: Chief Ron Harrison Councilman May moved to accept the bid summary as recommended. The motion was seconded by Councilman Cassada. Councilman Banks asked if this was subject to negotiations. Ms. Carroll stated yes. You have to award it to a construction company then staff will meet with them to come up with some ideas to possibly save money. We previously had a meeting with the architect and we’re trying to find way to get it down as much as we can. Councilman Hughes stated we are, counting the $150,000 extra, still at $600,000 over budget. Ms. Carroll stated that’s correct with the additional furniture at $150,000 that would need to be added. We haven’t come up with a price. I am just asking you to approve a company that we can negotiate with and they were the low bidder. Councilman Cassada asked if this was a different concept than fire hall 5. Ms. Carroll stated there are some things from fire hall 5 they have modified. Councilman Cassada asked if we could get a plans where it is all the same instead of paying an architect every time. Ms. Carroll stated modifications were made and also the State requires you to have an architect over any project that exceeds $5,000. Councilman Cassada asked would the architect sign off on existing plans. Ms. Carroll replied if you do not make changes. Mr. Fivas stated part of the process is we need to award it before we can negotiate. We will bring information to the Council since we are not accepting the price at this time. Vice Mayor Johnson asked if all fire halls should have the same blue print or depending on the area be different. Ms. Carroll stated there is some difference in the size. The State has mandated certain things, like turnout gear location and the washing machines are some of the differences between the two stations. Chief Harrison stated we wanted to allow for growth so we added four bedrooms for another crew. Councilman Cassada asked if this new blueprint could be used for #7. Chief Harrison stated he hoped so. Upon roll call the motion was unanimously passed. The following Ordinance was then presented in full: ORDINANCE NO: 2017-19 AN ORDINANCE OF THE CITY OF CLEVELAND, TENNESSEE TO AMEND THE 2016-2017 BUDGET FOR THE CITY OF CLEVELAND, TENNESSEE. BE IT ORDAINED by the City Council of the City of Cleveland that the City of Cleveland, Tennessee budget for fiscal year 2016-2017 be amended according to the attached amendment. BE IT FURTHER ORDAINED by the City Council of the City of Cleveland, Tennessee that all ordinances in conflict with the provisions of this ordinance are hereby repealed. This Ordinance shall take effect from and after its final passage, the public welfare of the City of Cleveland requiring it. p. 414 REGULAR SESSION MAY 22, 2017 PAGE -11- MINUTE BOOK 28 APPROVED AS TO FORM: /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk p. 415 REGULAR SESSION MAY 22, 2017 PAGE -12- MINUTE BOOK 28 p. 416 REGULAR SESSION MAY 22, 2017 PAGE -13- MINUTE BOOK 28 p. 417 REGULAR SESSION MAY 22, 2017 PAGE -14- MINUTE BOOK 28 Councilman Banks moved that Ordinance No: 2017-19 be voted for passage on first reading. The motion was seconded by Vice Mayor Johnson; and upon roll call, unanimously passed. The following Resolution was then presented in full: • Resolution No: 2017-31 - Annual Review of the City’s Debt Management Policy. RESOLUTION NO: 2017-31 A RESOLUTION AMENDING THE DEBT MANAGEMENT POLICY FOR THE CITY OF CLEVELAND WHEREAS, the Tennessee Comptroller of the Treasury issued provisions regarding the establishment of a debt management policy; and WHEREAS, the Comptroller’s provisions require that cities annually review its debt management policy; and WHEREAS, the City of Cleveland adopted its Debt Management Policy on November 14, 2011. NOW, THEREFORE, BE IT RESOLVED, that the City Manager, Assistant City Manager/CFO, and the Mayor and City Council have reviewed the City of Cleveland Debt Management Policy and do not recommend any changes to the policy at this time. The City’s Debt Management Policy will be reviewed annually during the budget process, which process allows public input. Approved the 22nd day of May, 2017. APPROVED AS TO FORM: /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk Councilman Estes moved that Resolution No: 2017-31 be accepted as presented. The motion was seconded by Councilman Hughes. Councilman Estes then stated we should be at 50% variable and we are almost at two-thirds. We don’t follow our policy. We should solicit an advisor, we don’t. We should prefer fixed, we don’t. We have a debt policy that we do not follow. We are about to vote on more variable debt to take it even further. We need to get ahold of this and we need experts to inform us. There is too much money at stake to continue going p. 418 REGULAR SESSION MAY 22, 2017 PAGE -15- MINUTE BOOK 28 synthetically fixed with the Bond Fund for five years and paying fees now, paying them later when we refinance and we stay synthetically fixed. On June 28 something needs to happen. We don’t need RFQ’s or to put it off and drag it on. We need some experts to come in and tell us how to structure our debt and where we can save and refinance now. We quival over little bits of money but we give away hundreds of thousands of dollars in fees and interest every year. This is where the money is and where we can save. When he is asked what is the number one threat to the City of Cleveland, it is our debt structure. Two-thirds is variable and it is the greatest threat. Councilman Estes stated he, along with staff and Cleveland Utilities would to look at companies to evaluate and give us advice. Councilman Estes will have a small presentation and a recommendation to move forward with our debt and lay it out the best he can because it is too important. We need to follow our debt policy. Councilman Banks asked for comments from Mr. McKay. Mr. McKay replied the City has a very good bond rating and if we went to market we may be much more competitive on interest rates. He feels we could get 20-year fixed rates as good as a 5-year synthetic fixed rate. It is concerning we carry quite a bit of variable debt. Variable debt is locked for 5-years but can go up after that. Councilman Estes stated if it is truly fixed we can save and budget accurately. Upon roll call the motion was unanimously passed. The following Resolution was then presented in full: RESOLUTION NO: 2017-32 INITIAL RESOLUTION AUTHORIZING THE INCURRENCE OF TAXABLE INDEBTEDNESS BY THE CITY OF CLEVELAND, TENNESSEE, IN THE AMOUNT OF NOT TO EXCEED $3,000,000, BY THE EXECUTION WITH THE PUBLIC BUILDING AUTHORITY OF THE CITY OF CLARKSVILLE, TENNESSEE, OF A LOAN AGREEMENT TO PROVIDE FUNDING FOR PUBLIC WORKS PROJECTS, AND TO FUND THE INCIDENTAL AND NECESSARY EXPENSES RELATED THERETO WHEREAS, it is necessary and in the public interest of the City of Cleveland, Tennessee (the “Municipality”), to incur indebtedness (the “Indebtedness”), through the execution with The Public Building Authority of the City of Clarksville, Tennessee (the “Authority”), of a loan agreement (a “Loan Agreement”), for the purpose of financing certain public works projects, as hereinafter more fully described. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Cleveland, Tennessee, as follows: SECTION 1. For the purpose of financing all or a portion of the costs of certain public works projects, consisting of the City's share of the costs of infrastructure at the Spring Branch Industrial Park, the acquisition of all other property real and personal, appurtenant thereto or connected with such work, and to pay legal, fiscal, administrative, and engineering costs, and to pay costs incident to incurring the Indebtedness (collectively, the “Project”), the Municipality is hereby authorized to incur Indebtedness in the amount of not to exceed Three Million Dollars ($3,000,000), for the financing of the Project through the execution of a Loan Agreement with the Authority. The rate of interest payable pursuant to the provisions of a Loan Agreement shall be a fixed rate which rate shall not exceed the maximum rate of interest permitted under the laws of the State of Tennessee. SECTION 2. The indebtedness evidenced by the Loan Agreement shall be payable from funds of the Municipality legally available therefor and to the extent necessary from ad valorem taxes to be levied for such purpose on all taxable property within the corporate limits of the Municipality, without limitation as to time, rate, and amount and for the punctual payment of said principal of, premium, if any, and interest on, the Loan Agreement, the full faith and credit of the Municipality will be irrevocably pledged. SECTION 3. The Loan Agreement shall be executed pursuant to the provisions of Title 9, Chapter 21, Tennessee Code Annotated, as amended (the “Act”), and Title 12, Chapter 10, Tennessee Code Annotated, as amended. p. 419 REGULAR SESSION MAY 22, 2017 PAGE -16- MINUTE BOOK 28 SECTION 4. After the adoption of this Resolution, the City Clerk is directed to cause this Resolution, with the notice prescribed by the Act, to be published in full once in a newspaper published and having general circulation in the Municipality. SECTION 5. This Resolution shall take effect from and after its adoption, the welfare of the Municipality requiring it. Approved and adopted this 22nd day of May, 2017. APPROVED AS TO FORM: /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk NOTICE The foregoing Resolution has been adopted. Unless within twenty (20) days from the date of publication hereof a petition, signed by at least ten percent (10%) of the registered voters of the City of Cleveland, Tennessee, shall have been filed with the City Clerk of the City of Cleveland, Tennessee, protesting the incurrence of the Indebtedness by the execution of the Loan Agreement, such Loan Agreement will be executed, as proposed. STATE OF TENNESSEE) COUNTY OF BRADLEY) I, Shawn McKay, hereby certify that I am the duly qualified and acting City Clerk of the City of Cleveland, Tennessee (the “Municipality”), and, as such official, I further certify as follows: (1) that attached hereto is a copy of a resolution excerpted from the minutes of the meeting of the City Council (the “Council”), of said Municipality held on May 22, 2017; (2) that I have compared said copy with the original minute record of said meeting in my official custody; (3) that said copy is a true, correct, and complete transcript from said original record insofar as said original record relates, to, among other matters, the incurring of taxable indebtedness in the amount of not to exceed $3,000,000, by said Municipality; (4) that the actions by said Council including the aforementioned, at said meeting were promptly and duly recorded by me in a book kept for such purpose; and, (5) that a quorum of the members of said Council was present and acting throughout said meeting. WITNESS my official signature and the seal of said Municipality this 22nd day of May, 2017. ___________________________________ City Clerk (SEAL) Councilman May moved that Resolution No: 2017-32 be accepted as presented. The motion was seconded by Councilman Hughes. Councilman Estes asked if this was fixed. Mr. McKay stated it is a 5- year rate lock with a twenty-year amortization. The banks that provided rates to the Bond Fund would not provide a fixed rate. Councilman Estes stated he will vote for the Resolution but is against it because it is adding to our variable debt. Mr. McKay stated this will not change the percentage since it is replacing debt issued last year. Councilman Estes replied he is aware but this is another example. Upon roll call, Councilmen May, Hughes, McKenzie, Estes, Cassada, and Vice Mayor Johnson voted aye. Councilman Banks passed on the motion due to his brother in-law owing property for this project, but it is a worthwhile project. p. 420 REGULAR SESSION MAY 22, 2017 PAGE -17- MINUTE BOOK 28 The following Resolution was then presented in full: RESOLUTION NO: 2017-33 RESOLUTION AUTHORIZING A LOAN PURSUANT TO A LOAN AGREEMENT BETWEEN THE CITY OF CLEVELAND, TENNESSEE, AND THE PUBLIC BUILDING AUTHORITY OF THE CITY OF CLARKSVILLE, TENNESSEE, IN THE PRINCIPAL AMOUNT OF NOT TO EXCEED $3,000,000; AUTHORIZING THE EXECUTION AND DELIVERY OF SUCH LOAN AGREEMENT AND OTHER DOCUMENTS RELATING TO SAID LOAN; APPROVING THE ISSUANCE OF A TAXABLE BOND BY SUCH PUBLIC BUILDING AUTHORITY; PROVIDING FOR THE APPLICATION OF THE PROCEEDS OF SAID LOAN AND THE PAYMENT OF SUCH INDEBTEDNESS; CONSENTING TO THE ASSIGNMENT OF THE CITY'S OBLIGATION UNDER SUCH LOAN AGREEMENT; AND, CERTAIN OTHER MATTERS WHEREAS, the City Council (the "Council"), of the City of Cleveland, Tennessee (the "Municipality" or the "City"), has determined that it is necessary to finance the costs of certain "public works projects", as defined in Title 9, Chapter 21, Tennessee Code Annotated, as from time to time amended and supplemented, consisting of financing the City's share of the costs of infrastructure at the Spring Branch Industrial Park, the acquisition of all other property real and personal, appurtenant thereto or connected with such work, and to pay legal, fiscal, administrative, and engineering costs, and to pay costs incident to the issuance of the Bond and the loan of the proceeds thereof to the City (collectively, the "Project"), by obtaining a loan from The Public Building Authority of the City of Clarksville, Tennessee (the "Authority"); WHEREAS, it has been determined by the Council of the City to be in the best interests of the City to finance the Project through The Tennessee Municipal Bond Fund fixed rate loan program; WHEREAS, the City is authorized by Title 9, Chapter 21, Tennessee Code Annotated, as amended, to borrow funds and incur indebtedness for the purpose of financing the Project, subject to the compliance by the Municipality of the provisions of Title 13, Chapter 16, Part 2, Tennessee Code Annotated, as amended, with respect to obtaining a Certificate of Public Purpose and Necessity; WHEREAS, the Authority has been established pursuant to the provisions of Title 12, Chapter 10, Tennessee Code Annotated, as amended (the "Act"), and is authorized pursuant to the provisions of the Act to issue its bonds from time to time, in one more series, and to loan the proceeds thereof to the Municipality for the above described purposes; WHEREAS, in order to effectuate the program, the Issuer has authorized and approved by its Resolution, adopted May 13, 2015, the issuance of its Local Government Loan Program Bonds, in an aggregate principal amount not to exceed $300,000,000; WHEREAS, the Authority will issue its Taxable Local Government Loan Program Bond, Series 2017 (City of Cleveland Spring Branch Industrial Park Loan) (the "Bond"), in the principal amount of not to exceed Three Million Dollars ($3,000,000), and loan the proceeds thereof to the City pursuant to the provisions of a Loan Agreement, by and among the City, the Authority, and the Purchaser, as hereinafter defined, to be dated the date of issuance and delivery (the "Loan Agreement"); WHEREAS, the Council of the City has on the date hereof adopted an Initial Resolution authorizing the borrowing of funds and the incurring of taxable indebtedness for the purpose of financing the Project in the amount of not to exceed $3,000,000, and the City Clerk has been instructed to publish such Initial Resolution together with the Notice required by Section 9-21-206 of Tennessee Code Annotated, as amended, in a local newspaper in the City; WHEREAS, the indebtedness evidenced by the Loan Agreement shall be payable from any and all funds of the Municipality legally available therefor, including, but not necessarily limited to, ad valorem taxes to be levied for such purpose on all taxable property within the corporate limits of the Municipality, without limitation as to time, rate, and amount and for the punctual payment of said principal of, premium, if any, and interest on, the Loan Agreement, the full faith and credit of the Municipality will be irrevocably pledged; and, p. 421 REGULAR SESSION MAY 22, 2017 PAGE -18- MINUTE BOOK 28 WHEREAS, the Bond is to be secured by and contain such terms and provisions as set forth in a Bond Purchase Agreement, entered into between the Authority and the purchaser of the Bond (the "Purchaser"). NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Cleveland, Tennessee, as follows: Section 1. Approval of the Loan. (a) For the purpose of providing funds to finance the Project and to pay costs incident to the issuance and sale of the Bond and the loan of the proceeds thereof to the City, the loan to the City from the Authority is hereby authorized in the principal amount of not to exceed $3,000,000 and the City is hereby authorized to borrow such funds from the Authority (the "Loan"). (b) The Bond to be issued by the Authority shall bear interest at a fixed rate to be determined at the time of the issuance of the Bond, as provided in the Loan Agreement. The Mayor and City Clerk are authorized to enter into the Loan Agreement, such Loan Agreement to bear interest at a fixed rate, as the Mayor and City Clerk shall determine is in the best interest of the Municipality. The Municipality shall make payments of interest and principal in the amounts and on the dates set forth in the Loan Agreement from the sources and funds described herein and in the Loan Agreement. The final rate of interest payable on the Loan Agreement shall not exceed the maximum rate of interest permitted by applicable law. The Loan Agreement shall be for a term of twenty years. The final principal and interest payment dates, final interest rate payable, amortization of principal amounts of the loan evidenced by the Loan Agreement, and prepayment provisions of such Loan Agreement, may be established by the Mayor and the City Clerk, at the time of the sale of the Bond and the execution and delivery of the Loan Agreement, as shall be determined to be in the best interests of the Municipality, in accordance with the terms of this Resolution and the Loan Agreement. (c) The Council of the City understands and is aware that the Purchaser has the option to put the Bond for purchase to the Authority during the term of the Loan (the "Put Option"), at certain intervals upon not less than one hundred eighty days' written notice to the Authority, the Tennessee Municipal Bond Fund, as administrator, and the City. The Council is aware of the risks and benefits associated with the Loan and the Put Option. The Council finds that the repayment structure of the Loan (including the Put Option) is in the public interest of the City. The Council further agrees that it is willing to pay additional issuance costs associated with the refunding of the Loan and related Bond in the event the Put Option is exercised by the Purchaser. In the event that the Put Option is exercised by the Purchaser, and the City is unable to pay the Loan amount in full on such date and no subsequent holder can be determined, the Council commits to refund the Loan in the following manner: (x) the Council shall submit a plan of refunding to the Comptroller or Comptroller's designee; (y) the final maturity of the refunding debt obligation will not extend beyond the final maturity of the original Loan; and, (z) the debt service structure of the refunding debt obligation will be substantially similar to or more declining than the debt structure of the original Loan. The Council has not retained an independent municipal advisor in connection with the Loan. The Council understands and acknowledges that the Purchaser does not owe a fiduciary duty to the City and that the Purchaser is acting for its own business and commercial interests. The Council has consulted with such advisors and experts as it deems appropriate before the consideration and adoption of this Resolution. p. 422 REGULAR SESSION MAY 22, 2017 PAGE -19- MINUTE BOOK 28 Section 2. Approval of Loan Agreement. The form, terms, and provision of the Loan Agreement are in the best interest of the Municipality and are hereby approved and the Council hereby authorizes the Mayor and the City Clerk of the Municipality to execute and deliver such Loan Agreement, such Loan Agreement to be in substantially the form of the Loan Agreement presented to this meeting, the execution of such Loan Agreement by the Mayor and the City Clerk to evidence their approval of any and all changes to such Loan Agreement, and any related documents necessary to the consummation of the transactions contemplated by the Loan Agreement. Section 3. Fulfillment of Obligations. The Council of the Municipality is authorized and directed to fulfill all obligations of the Municipality under the terms of the Loan Agreement. Section 4. Tax Levy. There shall be levied and collected in the same manner as other ad valorem taxes of the Municipality on all taxable property within the corporate limits of the Municipality without limitation as to time, rate, or amount, to the extent necessary in the event funds of the Municipality legally available to pay the indebtedness evidenced by the Loan Agreement are insufficient, a tax sufficient to pay when due the amounts payable under the Loan Agreement, as and when they become due, and to pay any expenses of maintaining and operating the Project required to be paid by the Municipality under the terms and provisions of the Loan Agreement. For the prompt payment of the Loan Agreement, both principal and interest, as the same shall become due, the full faith and credit of the Municipality are irrevocably pledged. Section 5. Approval of Bond. For the purpose of providing funds to make the loan to the Municipality evidenced by the Loan Agreement, as provided herein and in the Loan Agreement, and to pay legal, fiscal, and administrative costs incident thereto, including costs incident to the issuance and sale of the Bond related to the Loan Agreement, the issuance and sale of the Bond by the Authority in connection with the Loan Agreement is hereby approved. Section 6. Disposition of Proceeds. The proceeds from the sale of the Bond shall be paid, from time to time, to the official of the Municipality designated by law as the custodian of the funds, upon submission of a requisition for such funds by the Municipality to the Purchaser, in accordance with the terms of the Loan Agreement. Such proceeds shall be disbursed from time to time solely to finance the costs of the Project and to pay costs of issuance incurred in connection with the issuance of the Bond and the loan of the proceeds thereof to the Municipality. Any monies remaining in the Project Fund after completion of the Project shall be used to pay debt service on the Bond. Section 7. Consent to Assignment. The Municipality hereby consents to the assignment of all of the Authority's right, title, and interest in and to the Loan Agreement as security for the Bond to which such Loan Agreement relates, except for certain reserved rights of the Authority, to the Purchaser. Section 8. Miscellaneous Acts. The Mayor, the City Clerk, the Finance Director, the City Manager, the City Attorney, and all other appropriate officials of the Municipality are hereby authorized, empowered, and directed to do any and all such acts and things, and to execute, acknowledge, and deliver all such documents, instruments, and certifications, in connection with the execution of the Loan Agreement and the issuance of the Bond by the Authority, in addition to those acts, things, documents, instruments, and certifications hereinbefore authorized and approved, as may in their discretion, be necessary or desirable to implement or comply with the intent of this Resolution or any of the documents herein authorized and approved. Section 9. Captions. The captions or headings in this Resolution are for convenience only and shall in no way define, limit, or describe the scope or intent of any provision hereof. Section 10. Severability. Should any provision or provisions of this Resolution be declared invalid or unenforceable in any respect by final decree of any court of competent jurisdiction, the invalidity or unenforceability of such section, paragraph, ordinance, or provisions shall not affect the remaining provisions of such Resolution. Section 11. Repeal of Conflicting Resolutions. All resolutions or parts thereof in conflict herewith are, to the extent of such conflict, hereby repealed. p. 423 REGULAR SESSION MAY 22, 2017 PAGE -20- MINUTE BOOK 28 Section 12. Effective Date. This Resolution shall take effect upon its adoption, the welfare of the Municipality requiring it. Approved and adopted this 22nd day of May, 2017. APPROVED AS TO FORM: /s/John F. Kimball ___________________________ City Attorney Tom Rowland, Mayor ___________________________ Shawn McKay, City Clerk STATE OF TENNESSEE) COUNTY OF BRADLEY) I, Shawn McKay, hereby certify that I am the duly qualified and acting City Clerk of the City of Cleveland, Tennessee (the “Municipality”), and, as such official, I further certify as follows: (1) that attached hereto is a copy of a resolution excerpted from the minutes of the meeting of the City Council (the “Council”), of said Municipality held on May 22, 2017; (2) that I have compared said copy with the original minute record of said meeting in my official custody; (3) that said copy is a true, correct, and complete transcript from said original record insofar as said original record relates, to, among other matters, the incurring of taxable indebtedness in the amount of not to exceed $3,000,000, by said Municipality; (4) that the actions by said Council including the aforementioned, at said meeting were promptly and duly recorded by me in a book kept for such purpose; and, (5) that a quorum of the members of said Council was present and acting throughout said meeting. WITNESS my official signature and the seal of said Municipality this 22nd day of May, 2017. ______________________________ City Clerk (SEAL) Councilman Estes moved that Resolution No: 2017-33 be accepted as presented. The motion was seconded by Councilman Cassada. Councilman Estes stated he is for the project but against the variable debt issue. Upon roll call, Councilmen Estes, Cassada, McKenzie, May, Hughes and Vice Mayor Johnson voted aye. Councilman Banks passed due to his brother in-law owing property for this project, but again, it is a worthwhile project. Councilman Banks moved that the following policy concerning firework displays. The motion was seconded by Councilman Hughes; and upon roll call, unanimously passed. p. 424 REGULAR SESSION MAY 22, 2017 PAGE -21- MINUTE BOOK 28 Councilman Banks moved to waive the cost of fire suppression vehicles and firefighters (Number 3 in the policy) for the 2017 WCLE Duck Race to be held on June 23. The motion was seconded by Councilman May; and upon roll call, unanimously passed. Mayor Rowland stated Mr. Word had contacted him about the property located at 37th Street/Tasso Road for fire hall #7. Mr. Fivas stated he understands an appraisal is in but has yet to see it. Mayor Rowland stated that is what he relayed to Mr. Word. Councilman Estes moved that Mr. Fivas and City Staff pursue downtown redevelopment conceptual drawings in whatever ways they see best and to work with Mainstreet. The motion was seconded by Councilman Cassada; and upon roll call, unanimously passed. There being no future business the meeting was adjourned at 3:39 p.m. _________________________________ ______________________________ Mayor City Clerk