Item H04 H.4
Coty f � ,�� ,' BOARD OF COUNTY COMMISSIONERS
�� Mayor David Rice,District 4
The Florida Keys � Mayor Pro Tem Craig Cates,District 1
y Michelle Coldiron,District 2
James K.Scholl,District 3
Ij Holly Merrill Raschein,District 5
County Commission Meeting
September 21, 2022
Agenda Item Number: H.4
Agenda Item Summary #11074
BULK ITEM: No DEPARTMENT: Land Authority Governing Board
TIME APPROXIMATE: STAFF CONTACT: Christine Hurley (305) 295-5180
9:25 AM
AGENDA ITEM WORDING: Approval of Subordination Agreement between Monroe County
Comprehensive Plan Land Authority and First State Bank of the Florida Keys whereby Monroe
County Land Authority (MCLA) will subordinate its Second and Third Mortgages (but not its deed
restrictions) to a new mortgage to be issued by First State Bank of the Florida Keys to the Key West
Housing Authority to refinance the existing first mortgage and secure funding for rehabilitation of
units at 817, 818, 819, and 820 Washington Street.
ITEM BACKGROUND:
In 2010 the Key West Housing Authority (KWHA) purchased 16 multi-family units at 817-820
Washington Street in Key West for $2,950,000. The Monroe County Land Authority helped
finance this purchase investing $1,636,000 as follows:
1) a 30-year zero interest balloon second mortgage for $836,000 to be repaid in full in July, 2040
and
2) a 30-year soft third mortgage for$800,000 (forgivable in July 2040)
MCLA issued these mortgages in exchange for a deed restriction that requires the dwelling units
to be rented to families whose income is below 160% of the median income for the area. Land
Authority funding may only be used for projects that meet this requirement, according to Section
380.0666(3).
KWHA is in the process of re-financing the Washington Street Apartments in order to make
some necessary repairs to the property. The KWHA Board has adopted two resolutions
(attached) approving this refinancing. KWHA is requesting MCLA to subordinate to the new
first mortgage held by First State Bank. The current situation is as follows:
• The current outstanding I"mortgage held by First State Bank is $898,292
• The proposed increase in the I"mortgage to cover repairs is $596,400
• The resulting total I"mortgage would be $1,494,692
• Appraised Value of the property without the repairs is $4,410,000.
KWHA has provided a 20 year proforma (attached) that demonstrates the viability of the new
loan, as well as the MCLA payback. At the point in time in which the MCLA loan is to be paid
back (July, 2040), the balance remaining on the I" mortgage is expected to be $136,959. If
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necessary, KWHA could restructure debt again to satisfy the MCLA debt. The proforma shows
the KWHA setting aside funding each year to pay back the MCLA 2nd Mortgage.
This item seeks approval of Subordination Agreement between Monroe County Comprehensive
Plan Land Authority and First State Bank of the Florida Keys whereby Monroe County Land
Authority (MCLA) will subordinate its Second and Third Mortgages (not deed restrictions) to a
new mortgage to be given by First State Bank of the Florida Keys to the Key West Housing
Authority, in order to refinance the existing mortgage and secure funding for rehabilitation of
units at 817, 818, 819, and 820 Washington Street.
PREVIOUS RELEVANT BOCC ACTION: N/A
CONTRACT/AGREEMENT CHANGES:
N/A
STAFF RECOMMENDATION: Approval
DOCUMENTATION:
Proposed Subordination Agreement
Existing Deed Restrictions
KWHA Proforma
KWHA Resolution 22-2597
KWHA Resolution 22-2602
Legal Description Of Subject Property
Request from KWHA
FINANCIAL IMPACT:
Effective Date:
Expiration Date:
Total Dollar Value of Contract:
Total Cost to County:
Current Year Portion:
Budgeted:
Source of Funds:
CPI:
Indirect Costs:
Estimated Ongoing Costs Not Included in above dollar amounts:
Revenue Producing: If yes, amount:
Grant:
County Match:
Insurance Required:
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Additional Details:
N/A
REVIEWED BY:
Christine Hurley Completed 09/02/2022 8:59 AM
Dina Gambuzza Completed 09/02/2022 9:03 AM
Mark Rosch Completed 09/02/2022 6:05 PM
Lindsey Ballard Completed 09/06/2022 8:57 AM
Board of County Commissioners Pending 09/21/2022 9:00 AM
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Prepared by and after
recording mail to:
Robert C.Reid,Esq.
Bryant Miller Olive P.A.
1545 Raymond Diehl Road
Tallahassee, Florida 32308
SUBORDINATION AGREEMENT
THIS AGREEMENT made this day of September, 2022 between
MONROE COUNTY COMPREHENSIVE PLAN LAND AUTHORITY, a land
authority under Section 380.0663(1), Florida Statutes, hereinafter referred to as "Land 0
Authority," and FIRST STATE BANK OF THE FLORIDA KEYS, hereinafter referred
to as "Lender".
THE PARTIES STIPULATE AND RECITE THAT:
A. On or about July 19, 2010, THE HOUSING AUTHORITY OF THE CITY
OF KEY WEST,FLORIDA,hereinafter referred to as "Owner," entered into that certain E
Second Mortgage Deed in favor of the Monroe County Comprehensive Plan Land U)
Authority, a land authority under Section 380.0663(1), Florida Statutes, and Monroe
County Ordinance No. 031-1986 (the "Land Authority') recorded in O.R. Book 2475,
Page 1762, of the Public Records of Monroe County, Florida (the "Second Mortgage").
B. On or about July 19, 2010 the Owner entered into that certain Third
Mortgage in favor of the Land Authority recorded in O.R. Book 2475, Page 1767, of the
Public Records of Monroe County, Florida (the "Third Mortgage").
C. Owner has executed, or is about to execute, a mortgage and
promissory note in the amount of One Million Four Hundred Eighty-Six Thousand
Nine Hundred Twenty And No/100 Dollars ($1,486,920.00) in favor of Lender, and
Land Authority acknowledges that such mortgage is in the best interest of Owner.
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E. Lender is willing to accept the said mortgage from Owner provided that 0
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Land Authority will subordinate its Second Mortgage and Third Mortgage referred to in
paragraphs A and B above.
For the reasons set forth above, and in consideration of the mutual covenants and
promises of the parties hereto, Land Authority and Lender agree as follows:
The Land Authority Second Mortgage referred to in paragraph A above and the
Land Authority Third Mortgage referred to in paragraph B above, pertaining to the real
property described on Exhibit "A," attached hereto, shall be subordinate to the claim of
Lender under the Mortgage and Security Agreement(the"Lender Mortgage")executed by
Owner, dated as of September 2022 and recorded in O.R. Book Page of
the Public Records of Monroe County,Florida.
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Land Authority shall execute such additional documents as Lender may
reasonably require to give effect to this Agreement.
[Remainder of page intentionally left blank-signature pages follow]
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IN WITNESS WHEREOF, the parties have executed this Agreement at Monroe
County, State of Florida, the day and year first above written.
MONROE COUNTY COMPREHENSIVE PLAN
LAND AUTHORITY
WITNESSES: By:
Chairman 2
Print:
Print:
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STATE OF FLORIDA
COUNTY OF MONROE
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The foregoing instrument was acknowledged before me by means of ❑ physical
presence or ❑ online notarization, this _ day of September, 2022, by as
Chairman of Monroe County Comprehensive Plan Land Authority, on behalf of said
Authority. Such person is personally known to me or has produced a valid driver's license
as identification.
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Notary Public; State of Florida
Print Name:
My Commission Expires:
My Commission No.:
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FIRST STATE BANK OF THE FLORIDA KEYS
WITNESSES: By:
Kurt Lewin, Sr., Vice President
Print:
Print:
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STATE OF FLORIDA
COUNTY OF MONROE
The foregoing instrument was acknowledged before me by means of ❑ physical 0
presence or ❑ online notarization, this _ day of [August], 2022, by Kurt Lewin, Sr., as a
Vice President of First State Bank of the Florida Keys, on behalf of said entity. Such person
is personally known to me or has produced as identification.
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Notary Public; State of Florida
Print Name:
My Commission Expires:
My Commission No.:
(Notary Seal)
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LEGAL DESCRIPTION
Lots 15 and 16, Block 14, Key West Investment Company, according to the Plat thereof
recorded in Plat Book 1,Page 69,Public Records of Monroe County, Florida.
AND
On the island of Key West and known on the Plat of the Key West Investment Company
recorded in Plat Book 1 at Page 69 as Lots 5 and 6 in Block 11 of Tract 17 and more
particularly described as follows: Commencing at a point on the Southeasterly side of
Washington Street distant 200 feet in a Northeasterly direction from the corner of the
intersection of William Street and Washington Street and running thence along the
Southeasterly side of Washington Street in a Northeasterly direction 100 feet to a ten foot
alley; thence at right angles in a Southeasterly direction and along said alley 100 feet to a
10 foot alley; thence at right angles in a Southwesterly direction 100' along said last
mentioned alley; thence a right angles in a Northwesterly direction 100 feet to the Point of
beginning on Washington Street.
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Vlac# 1798205 07/19/2010 4:20PM
Filed & Recorded in Official Records of
THIS INSTRUMENT PREPARED BY AND RETURN TO: MONROE COUNTY DANNY L. KOLHAGE
John M. Spottswood, Jr. tu,oca 179E1205
SPOTTSWOOD,SPOTTSWOOD&SPOTTSWOOD Doc c!�179 P # 1711
500 Fleming Street g
Key West,FL 33040
LAND USE RESTRICTION AGREEMENT
THIS LAND U Restriction AGREEMENT (hereinafter "Agreement") is made and
entered into a of the ay of July, 2010, by and between THE HOUSING AUTHORITY OF
THE CITY OF KE WEST, FLORIDA, a public body corporate and politic (hereinafter
"Borrower"), and the MONROE COUNTY COMPREHENSIVE PLAN LAND AUTHORITY, a
land authority pursuant to section 380.0663(1), Florida Statutes and Monroe County Ordinance No.
031-1986(hereinafter"Land Authority"),and their respective successors and assigns.
RECITALS
A. The Borrower, has requested and the Land Authority has agreed, under certain
conditions, to provide two (2) loans which total ONE MILLION, SIX HUNDRED THIRTY-SIX
THOUSAND AND NO/100 DOLLARS ($1,636,000.00) (collectively the loans shall be referred
to as the "Land Authority Loan") for the purchase of that certain multifamily rental housing
development located at 817-820 Washington Street in Key West, Florida, more particularly
described in Exhibit"A" attached hereto and incorporated herein by this reference(the"Property").
B. As a condition of the Land Authority Loan, the Borrower has agreed that the
Property shall comply with the affordable housing requirements specified herein. g
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NOW, THEREFORE, in consideration of the mutual covenants and undertakings set forth
herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged,the Borrower and Land Authority do hereby contract and agree as follows:
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ARTICLE I COMPLIANCE WITH LAND AUTHORITY REQUIREMENTS
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In order to comply with the Land Authority's requirements pursuant to section
380.0663(1), et seq., Florida Statutes and Monroe County Ordinance No. 031-1986, the
Borrower hereby covenants and agrees that Borrower's use of the Property shall be subject to
Affordability Covenants as follows:
1.01 Term. These affordability covenants are perpetual, run with the land, and are binding on
all present and subsequent owners and mortgagees.
1.02. Property Use. Use of the property shall be restricted to the provision of affordable rental
housing as defined in section 380.0666(3), Florida Statutes, as said statute may be amended
from time to time; provided however, so long as the obligation to First State Bank of the
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Florida Keys, its successor and assigns and the first mortgage, as may be modified,
extended or assigned, securing said obligation and executed on even date herewith remain
outstanding, the eligibility for affordable housing provided in said Statute shall not be
reduced below 160% of the median income for the area.
1.03. Monitoring. Borrower is responsible for ensuring compliance with the affordability
covenants contained herein and expressly agrees to furnish, upon Land Authority's request,
written certification thereof.
ARTICLE H CONSIDERATION
In addition to other purposes, the Land Authority has authorized and issued the Land
Authority Loan as an inducement to the Borrower to acquire the Property and provide affordable
housing for the benefit of persons or families whose incomes are equal to or less than the amounts
specified in this Agreement. In consideration of said Land Authority Loan for the foregoing purposes,
the Land Authority and Borrower have entered into this Agreement.
ARTICLE HI RELIANCE 0
In performing its duties hereunder, the Land Authority may rely upon statements and
certificates of the Borrower and tenants of the Property believed to be genuine and to have been
executed by the proper person or persons, and upon audits of the books and records of the Borrower
pertaining to occupancy of the Property.
ARTICLE IV TERM
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This Agreement shall become effective upon its execution and delivery, and shall remain in a
full force and effect without expiration, unless modified by mutual written consent of the parties. c�
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ARTICLE V ENFORCEMENT
If the Borrower defaults in the performance of its obligations under this Agreement or
breaches any material covenant, agreement or warranty of the Borrower set forth in this
Agreement, and if such default remains uncured for a period of thirty (30) days after written notice
thereof shall have been given by the Land Authority to the Borrower (or for an extended period
approved by the parties if such default stated in such notice can be corrected,but not within such thirty ..
(30) day period, and if the Borrower adopts a plan to correct or cure such default and commences
such correction within such thirty (30) day period (subject to any rights of tenants in possession of
units under a valid lease agreement), and thereafter diligently pursues the same to completion within
such extended period), then the Land Authority may take any action at law or in equity or
otherwise. The enforcement of this Agreement is not secured by the mortgage to the Land
Authority securing the Land Authority Loan.
ARTICLE VI RECORDING AND FILING: COVENANTS TO RUN WITH THE LAND
Upon execution and delivery by the Borrower, the Borrower shall cause this Agreement to
be recorded and filed in the official public records of the County and shall pay all fees and charges
incurred in connection therewith, including, without limitation, all documentary stamp tax, intangible
tax or any other excise taxes which may be due and payable in connection with the transaction
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contemplated by the Land Authority Loan. This Agreement and the covenants contained herein
shall run with the land and shall bind, and the benefits shall inure to, respectively, the Borrower and
Land Authority and their respective successors and assigns during the Term of this Agreement.
ARTICLE VII GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of the State
of Florida, with respect to both substantive rights and with respect to procedures and remedies.
ARTICLE VIII NOTICE AND EFFECT
All notices and other communications to be made or permitted to be made hereunder shall
be in writing and shall be delivered to the addresses shown below or to such other addresses that the
parties may provide to one another in accordance herewith. Such notices and other communications
shall be given by any of the following means: (a) personal service; (b) national express air courier,
provided such courier maintains written verification of actual delivery. Any notice or other
communication given by the means described in subsection (a) or (b) above shall be deemed
effective upon the date of receipt or the date of refusal to accept delivery by the party to whom such
notice or other communication has been sent. .
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Land Authority: Monroe County Land Authority
1200 Truman Avenue,Suite 207
Key West,FL 33040
Attention: Executive Director
Borrower: Key West Housing Authority
1403 12th Street
Key West,FL 33040
Attention: Executive Director
.
Any party may change said address by giving the other parties hereto Notice of such
change of address in accordance with the foregoing provisions.
ARTICLE IX MISCELLANEOUS
If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining portions shall not in any way be affected or unpaired.
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This Agreement may be simultaneously executed in multiple counterparts, all of which shall
constitute one and the same instrument and each of which shall be deemed to be an original.
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IN WITNESS WIIEREOF, the Borrower and Land Authority have caused this Agreement
to be signed, sealed and attested on their behalf by duly authorized representatives, all as of the date
first set forth above.
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WITNESSES:
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MONROE COUNTY COMPREHENSIVE PLAN
LAND AUTHORITY
By: � JS.
KIM WIGINOTON,
Chairman
Address: 1200 Truman Avenue, Suite 207 U)
Key West,FL,33040
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STATE OF FLORIDA .
COUNTY OF MONROE
The foregoing instrument was acknowledged before me this day of July, 2010, by
Kim Wigington, Chairman of the MONROE COUNTY COMPREHENSIVE PLAN LAND
AUTHORITY, a land authority pursuant to section 380.0663(1),Florida Statutes and Monroe County
Ordinance No. 031-1986, on behalf of the Land Authority. Said person is personally known to me or
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Notary
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Notary Publi tate of Florida r Ko��Y pq°°� Kimberly A PUb�iC Nystromof Florida
Kimberly A. Nystrom �o��oa� EMy pCo mission DD639861
My Commission Expires: April 19, 2011
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WITNESSES:
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HOUSING AUTHORITY OF THE CITY OF
KEY WES ORIDA
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By:
YJ. NUEL CASTILLO, Sr.
Executive Director and Secretary 0
Address: 1403 12� Street
Key West, FL 33040
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STATE OF FLORIDA g
COUNTY OF MONROE 2
The foregoing instrument was acknowledged before me this ( 'of July, 2010, by J.
Manuel Castillo, Sr., as Executive Director and Secretary of the HOUSING
AUTHORITY OF THE CITY OF KEY WEST, FLORIDA, a public body corporate and politic
duly created and existing under the laws of the State of Florida, on behalf of the Borrower. Said
person is personally known to me or has produced a valid driver's license as identification.
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Notary Public, State of Florida
My Commission Expires:
PATRICIA Mi GANISTI R
MY COMMISSION#DD594431
fJ EXPIRES:Sep 20,2010
OFF" Fl.Notary Di—ffl Asax.Co.
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EXHIBIT A
Lots 15 and 16, Block 14, Key West Investment Company, according to the Plat thereof recorded in Plat
Book 1,Page 69,Public Records of Monroe County,Florida.
AND
On the island of Key West and known on the Plat of the Key West Investment Company recorded in Plat
Book 1 at Page 69 as Lots 5 and 6 in Block 11 of Tract 17 and more particularly described as follows:
Commencing at a point on the Southeasterly side of Washington Street distant 200 feet in a Northeasterly 0
direction from the corner of the intersection of William Street and Washington Street and running thence
along the Southeasterly side of Washington Street in a Northeasterly direction 100 feet to a ten foot alley;
thence at right angles in a Southeasterly direction and along said alley 100 feet to a 10 foot alley; thence at
right angles in a Southwesterly direction 100' along said last mentioned alley; thence at right angles in a
Northwesterly direction 100 feet to the Point of beginning on Washington Street.
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NIIONROE COUNTY
[IIIFFICiAL RECORDS
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H.4.d
RESOLUTION NO. 22-2597
A RESOLUTION OF THE HOUSING AUTHORITY OF THE CITY OF
KEY WEST, FLORIDA; ESTABLISHING THE AUTHORITY'S INTENT
TO REIMBURSE CERTAIN CAPITAL IMPROVEMENT PROJECT COSTS
INCURRED WITH PROCEEDS OF FUTURE TAX-EXEMPT FINANCING
OR OTHER OBLIGATIONS; APPROVING LOAN COMMITMENT
FROM FIRST STATE BANK OF THE FLORIDA KEYS; PROVIDING g
CERTAIN OTHER MATTERS IN CONNECTION THEREWITH; AND
PROVIDING AN EFFECTIVE DATE. 0
WHEREAS, the Housing Authority of the City of Key West, Florida (the
"Authority") has determined that the need exists to undertake certain capital repairs 0
and improvements to its properties located at 817/818/819/820 Washington Street, Key
West, Florida ("Project)";
WHEREAS, the Authority adopted Resolution No. 2022-2591 on April 12, 2022
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which authorized an internal interfund loan to pay a portion of the capital costs to be
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incurred at the Project to be repaid within six months; and
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WHEREAS, the Authority received a loan commitment from First State Bank of
the Florida Keys ("First State Bank") dated April [22], 2022 (the "Commitment"), which �e
provided for the refinancing of the existing indebtedness on the Project and the loan of
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an additional principal amount of up to $596,400.00 to pay for the capital repairs and
improvements to the Project;
NOW, THEREFORE, BE IT RESOLVED BY THE HOUSING AUTHORITY OF
THE CITY OF KEY WEST,FLORIDA THAT:
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SECTION 1. AUTHORITY. This Resolution (hereinafter called the
"Resolution") is adopted pursuant to the provisions of the Florida Constitution, Chapter
421, Florida Statutes, and other applicable provisions of law.
SECTION 2. DECLARATION OF INTENT. The Authority hereby expresses its
intention to be reimbursed from proceeds of a tax-exempt financing or other obligations
for capital expenditures to be paid by the Authority in connection with the repair and
improvements of the Project. Pending reimbursement, the Authority expects to use
funds on deposit in its general fund, reserve funds and other funds legally available to 0
pay a portion of the cost of the Project. It is not reasonably expected that the total
amount of debt to be incurred by the Authority to reimburse itself for expenditures paid
with respect to the Project will exceed $596,400.00. This Resolution is intended to
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constitute a "declaration of official intent" within the meaning of Section 1.150-2 of the
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Income Tax Regulations.
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SECTION 3. ACCEPTANCE OF COMMITMENT. The Authority hereby
accepts the Commitment in the form attached hereto as Exhibit A, and the Chairman or
Executive Director are hereby authorized and directed to execute and deliver the
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Commitment on behalf of and in the name of the Housing Authority with such
additional changes, insertions and omissions therein as may be made and approved by
the said officers of the Authority executing the same, such execution to be conclusive
evidence of such approval.
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SECTION 4. EFFECTIVE DATE. This Resolution shall take effect immediately
upon its adoption.
PASSED AND ADOPTED BY THE HOUSING AUTHORITY OF THE CITY
OF KEY WEST, FLORIDA, THIS 10t"DAY OF MAY, 2022.
HOUSING AUTHORITY OF THE
CITY OF KEY WEST,FLORIDA
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By: MAKI
omksJr., C . �� m
j , G. Par ,j Chairman
ATTEST:
R Utc y Sterling, Secretary
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RESOLUTION NO. 22-2602
A RESOLUTION OF THE HOUSING AUTHORITY OF THE CITY OF KEY
WEST, FLORIDA APPROVING THE ISSUANCE OF THE HOUSING
AUTHORITY OF THE CITY OF KEY WEST, FLORIDA MULTIFAMILY
HOUSING REVENUE BOND (WASHINGTON STREET PROJECT), SERIES 2022
IN A PRINCIPAL AMOUNT OF NOT TO EXCEED $1,494,692.12 (THE
"BOND"), IN ONE OR MORE SERIES; APPROVING THE FORM OF AND
AUTHORIZING THE EXECUTION AND DELIVERY OF A MORTGAGE AND
SECURITY AGREEMENT, ASSIGNMENT OF LEASES AND RENTS, THE
BOND, LOAN AGREEMENT, AND ENVIRONMENTAL INDEMNITY 0
AGREEMENT, RELATING TO THE EXECUTION OF THE BOND;
APPROVING AND AUTHORIZING THE EXECUTION AND DELIVERY OF
CERTAIN ADDITIONAL AGREEMENTS NECESSARY OR DESIRABLE IN
CONNECTION WITH THE ISSUANCE OF AND PROVISION OF SECURITY 0
FOR THE BOND; APPROVE REFINANCING OF THE WASHINGTON STREET
PROJECT AND FINANCING CAPITAL IMPROVEMENTS THERETO;
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AUTHORIZING THE CHAIRMAN OR THE EXECUTIVE DIRECTOR TO
EXECUTE SAID DOCUMENTS; AUTHORIZING THE AWARD OF THE
HOUSING REVENUE BOND;AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, the Housing Authority now desires to authorize the issuance of not N
exceeding $1,494,692.12 in aggregate principal amount of The Housing Authority of the City of W
Key West, Florida Multifamily Housing Revenue Bond (Washington Street Project), Series 2022 N
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(the 'Bonds") by this resolution, payable from revenues derived from the operation of the a
Washington Street Apartments (the "Project") on behalf of The Housing Authority of the City of
Key West, Florida(the "Housing Authority"); and 0
WHEREAS, the Housing Authority desires to approve the forms of, and authorize the
execution and delivery of a Mortgage and Security Agreement, Assignment of Leases and Rents,
Bonds, Loan Agreement, Environmental Indemnity Agreement and other documents to be ;
executed in connection with the issuance of the Bonds; and
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WHEREAS, the Housing Authority has previously approved a loan commitment letter
from First State Bank of Florida Keys (the "Commitment Letter") in an amount not to exceed the
then outstanding principal amount of the Housing Authority's Multifamily Housing Revenue
Bond (Washington Street Project), Series 2010 (the "2010 Bonds") plus $596,400 for capital
improvements to the Project in accordance with the Commitment Letter.
NOW, THEREFORE, BE IT RESOLVED BY THE HOUSING AUTHORITY OF CITY OF
KEY WEST, FLORIDA as follows:
SECTION 1. AUTHORITY FOR THIS RESOLUTION. This Resolution is adopted
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pursuant to the provisions of Chapter 421, Florida Statutes, and other applicable provisions of
law.
SECTION 2. DEFINITIONS. The following words and phrases shall have the
following meanings when used herein:
"Act" means Chapters 421 and 423, Florida Statutes, and other applicable provisions of
law. �
"Assignment of Rents" means that certain Assignment of Leases and Rents, from the
Housing Authority to the Lender, substantially in the form of Exhibit C hereto. 0
"Bank Tax Rate" means the maximum marginal statutory percentage rate of federal
income tax applicable to the taxable income of the Owner or any Participant.
0
"Business Day" means any day except any Saturday, Sunday or day on which the Federal a
Reserve Bank of Atlanta is closed.
0
"Code" means the Internal Revenue Code of 1986, as amended, and any Treasury
Regulations, whether temporary, proposed or final, promulgated thereunder or applicable
thereto.
N
"Determination of Taxability" means a final decree or judgment of any Federal Court or a W
final action of the Internal Revenue Service or of the United States Treasury Department N
determining that any interest paid on the Bonds is includable in gross income of the holder
thereof for federal income tax purposes, or that Bonds, or any of them, are not a "qualified tax-
exempt obligation"within the meaning of Section 265(b)(3)of the Code. 0
"Environmental Indemnity" means the Environmental Indemnity, from the Housing
Authority to the Lender, substantially in the form of Exhibit E hereto.
"Interest Payment Date"means the first day of each month, commencing with the first day
of the month next following the month in which the Bonds are issued.
"Lender"means First State Bank of the Florida Keys, located in Key West, Florida.
"Loan Agreement" means that certain Loan Agreement, between the Housing Authority
and the Lender, substantially in the form of Exhibit D hereto.
"Loan Documents" means collectively, the Bonds, the Mortgage, the Assignment of Rents,
the Loan Agreement, the Environmental Indemnity, and any other document evidencing or
securing the repayment of the Loan.
2 Packet Pg. 1778
H.4.e
"Mortgage" means the Mortgage and Security Agreement, from the Housing Authority to
the Lender substantially in the form of Exhibit m_B hereto, together with any additional documents
required to enable the Mortgage to also secure the Bonds.
"Owner" or "Owners" means the Person or Persons in whose name or names a Bond shall
be registered on the books of the Housing Authority kept for that purpose in accordance with
provisions of this Resolution.
"Participant" or "Participants" means any financial or banking institution to which the
Lender shall grant a participation in or assign or sell or otherwise transfer all or any part of the
Lender's interest in the Bonds.
"Person" means natural persons, firms, trusts, estates, associations, corporations,
partnerships and public bodies. 0
"Pledged Revenues" means the revenues of the Project as and when received by the
Housing Authority. S
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"Resolution" means this Resolution, pursuant to which the Bonds are authorized to be
issued, including any Supplemental Resolution(s) adopted pursuant to Section 17 hereof.
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SECTION 3. FINDINGS.
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(a) It is necessary and serves a paramount public purpose for the Housing Authority
to issue its Bonds, as defined herein, to provide for all or a portion of the cost of the acquisition of
the Project to be owned by the Housing Authority. 0
0
(b) The Housing Authority is authorized under the Act to issue its Bonds for the
paramount public purpose of paying all or a portion of the cost of the Project.
(c) There is a shortage in the City of Key West, Florida (the "City"), of housing
available at prices which many persons or families can afford, which shortage has been found by
the Legislature of the State of Florida (the "State), and the City Commission of the City, to
constitute a threat to the health, safety, morals and welfare of the State and City, to deprive the
State and the City of an adequate tax base and to cause the State and the City to make extra
expenditures for crime prevention and control, public health, welfare and safety, fire and
accident protection, and other public services and facilities.
(d) The use of public funding to provide a "housing project" (as defined in the Act)
will assist in alleviating the shortage of existing affordable housing by making housing available
to low income persons and families, thereby enabling such persons to obtain sanitary, decent and
safe housing that they could not otherwise afford. The Project constitutes a "housing project"
3
Packet Pg. 1779
H.4.e
within the meaning of Section 421.03(9), Florida Statutes, and the issuance of the Bonds to
finance the acquisition of the Project in order to provide additional safe, decent and affordable
housing for low income persons is authorized by the Act.
(e) The Bonds are limited obligations of the Housing Authority payable solely from
the Pledged Revenues and amounts realized pursuant to the Mortgage and the other Loan
Documents. The Bonds are not an obligation of the City, the State or any other Person other than
the Housing Authority. Neither the faith and credit nor the taxing power of the City, the State or 2
any political subdivision thereof is pledged to the payment of the principal of the Bonds or the
interest thereon or other costs incident thereto. The Housing Authority has no taxing power.
0
(f) The Pledged Revenues will be sufficient to pay all of the principal of and interest
on the Bonds as the same become due, and to make all required payments required under this
Resolution.
0
(g) The principal of and interest on the Bonds and all required payments shall be a
0
made solely from the Pledged Revenues and, to the extent necessary, amounts realized pursuant
to the Mortgage and other Loan Documents as herein provided.
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(h) The Housing Authority has received an offer from the Lender to purchase the
Bonds, and in light of current market conditions, the need to proceed in an expedited manner s
and the willingness of the Lender to purchase the Bonds, a negotiated sale of the Bonds to N
Lender is in the best interest of the Housing Authority.
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(i) The Housing Authority has been or will be provided all applicable disclosure a
information required by Section 218.385(6), Florida Statutes.
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(j) In consideration of the purchase and acceptance of the Bonds authorized to be
issued hereunder by those who shall be the Owners thereof from time to time, this Resolution
shall constitute a contract between the Housing Authority and the Owners.
SECTION 4. AUTHORIZATION OF BONDS. Subject and pursuant to the provisions
of this Resolution and the Commitment Letter, obligations of the Housing Authority to be
known as The Housing Authority of the City of Key West, Florida, Multifamily Housing
Revenue Bond (Washington Street Project), Series 2022, are hereby authorized to be issued under
and secured by this Resolution, in the principal amounts of not to exceed the then outstanding
principal amount of the 2010 Bonds plus $596,400, for the purpose of providing funds to
refinance the 2010 Bonds and pay a portion of the costs of the capital improvements to the
Project. Because of the characteristics of the Bonds, prevailing market conditions, and additional
savings to be realized from an expeditious sale of the Bonds, it is in the best interest of the
Housing Authority to accept the offer of the Lender to purchase the Bonds at a private
negotiated sale. The Bonds are hereby sold by the Housing Authority to the Lender, subject to
the terms hereof and the Commitment incorporated herein by reference. The terms of the
4 Packet Pg. 1780
Commitment shall survive the issuance of the Bonds.
Prior to the issuance of the Bonds, the Housing Authority shall receive from the Lender a
Purchaser's Certificate, the form of which is attached hereto as Exhibit F and the Disclosure
Letter containing the information required by Section 218.385, Florida Statutes, a form of which
.is attached hereto as Exhibit G. In addition, subject to the terms and conditions of the
Cormnitment I-etter is hereby authorized to be issued with the Bonds under and pursuant to this
Resolution, so long as the aggregate principal amount of Bonds issued hereunder does not 0
exceed the then outstanding principal amount of the 2010 Bonds plus$596,400.
SECTION 5. DESCRIPTION OF BONDS. Each of the Bonds shall be dated the date of 0
their execution and delivery, which shall be a date agreed upon by the Housing Authority and
the Lender, shall bear interest at the rate of four and one-half percent(4.50%) (the "Interest Rate")
payable on such dates, shall mature on such date and shall contain such other terms and
provisions as set forth in the form attached hereto as 1-7xhibit& which form is hereby approved. 0
together with such changes as shall be approved by the Chairman or Vice Chairman, such
0
approval to be conclusively evidenced by the execution thereof by the Chairman or Vice
Chairman. The Bonds shall. be executed on behalf of the Housing Authority with the manual or S
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facsimile signature of the Chairman or Vice Chairman and shall have impressed thereon the
official sea[ of the Housing Authority, and be attested with the manual or facsimile signature of
the Secretary or an Assistant Secretary of the Housing Authority, and the Chairman or Vice
Chairman and Secretary or Assistant Secretary are hereby authorized to execute and attest to the N
Bonds on behalf of the Housing Authority.
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SECTION 6. REGISTRATION AND EXCHANGE OF BONDS; PERSONS
TREATED AS OWNERS. The Bonds are initially registered to the Lender. So long as the Bonds
shall remain unpaid, the Housing Authority will keep books for the registration and transfer of 0
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the Bonds. The Bonds shall be transferable only upon such registration books.
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The Person in whose name a Bond shall be registered shall be deemed and regarded as
the absolute owner thereof for all purposes, and payment ofprhicipal and interest on such Bond
shall be made only to or upon the written order of the Owner. All such payments shall be valid
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and effectual to satisfy and discharge the liability upon such Bond to the extent of the surn or
sums so paid.
SECTION 7. PAYMENT OF PRINCIPAL AND INTEREST; LimiTED
OBLIGA,rION. The Housing Authority promises that it will promptly pay the principal of and
interest on the Bonds at the place, on the dates and in the manner provided therein according to
the true intent and meaning hereof and thereof. The Bonds shall not be or constitute general
obligations or indebtedness of the Housing Authority as "bonds" within the meaning of Article
VIL Section 12 of the Constitution of Florida, but shall be payable solely from the Pledged
Revenues and, to the extent necessary, amounts realized pursuant to the Mortgage and the other
Loan Documents, in accordance with the terms hereof. INo holder of any Bond issued
5 1 Packet Pg. 1781
hereunder shall over have the right to compel the exercise of any ad valorem taxing power to pay
such Bond, or be entitled to payment of such Bond from any funds of the Housing Authority
except from the Pledged Revenues and, to the extent necessary, amounts realized pursuant to the
Mortgage and the other Loan Documents, as described herein.
SECTION 8. PREPAYMENT. The Bonds shall be subject to prepayment at the option
of the Housing Authority in whole or in part on any date, at a price equal to the principal
amount thereof to be prepaid, plus accrued interest to the date fixed for prepayment. The
.2
Housing Authority shall give the Owner of the Bonds 30 days prior written notice of its intent to M
prepay the Bonds.
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SECTION 9. PLEDGED REVENUES.
(a) The Housing Authority hereby pledges all. of the revenue and income of the
Project, together with an interest in the Project represented by the hereinafter approved 0
2
Mortgage and Assignment of Rents, to the payment due on the Bonds. The full repayment of the 9=
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Loan, and the performance of all of the obligations of the Housing Authority under the Loan
Documents shall be the responsibility of the Housing Authority.
(b) The Housing Authority hereby covenants, that as long as the Bonds are unpaid, it
will not impair or adversely affect the right of the Housing Authority to receive the Pledged
Revenues. The Housing Authority will proceed diligently to perform legally and effectively all N
steps required on its part to collect and receive the Pledged Revenues.
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SECTION 10. APPROVAL OF FORM OF LOAN DOCUMENTS. The Mortgage,
Assignment of Rents, Loan Agreement and Environmental Indemnity (the "Agreements"), are
hereby approved, confirmed and ratified and the Chairman, Vice-Chairman and/or Secretary or 0 U)
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an Assistant Secretary, or any other authorized officers of the Housing Authority are hereby
authorized and directed to execute and deliver the Agreements on behalf of and in the name of
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the Housing Authority with such additional changes, insertions and omissions therein as may be
made and approved by the said officers of the Housing Authority executing the same, such
execution to be conclusive evidence of such approval.
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SECTION 11. APPLICABILITY OF AFFORDABILITY POLICY; OPERATION OF
PROJECT. The Housing Authority hereby confirms that its Affordability Policy does not
contemplate the deduction of a utility allowance in determining affordable rental rates unless
such requirement is otherwise imposed as a condition of the financing for a housing project.
With respect to the Project, the financing does not require the deduction of a utility allowance in
determining affordable rental rates, and no such deduction will be applicable to the Project.
SECTION 12. APPLICATION OF PROCEEDS OF BONDS. At the time of delivery of
the Bonds herein authorized, the proceeds from the sale of the Bonds shall be used to refund the
2010 Bonds in full.and to pay a portion of the costs of capital improvements to the Project.
6 1 Packet Pg. 1782
All moneys deposited in said Project Account shall be and constitute a trust fund. created
for the purposes stated, and there is hereby created a fien upon such fund in favor of the holders
of the Bonds until the moneys thereof shall have been applied in accordance with this
Resolution.
SECTION 13. CREATION OF ACCOUNTS AND DISPOSITION OF REVENUES,
.2
There is hereby created the following funds and accounts:
(a) Revenue Fund, into which shall be deposited, upon receipt, all revenues and 0
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income derived from the Project (exclusive of any tenant security deposits). From such funds
and other Pledged I,'evenues, the Housing Authority shall. transfer first to the Debt Service Fund, 0
the amount of funds required to pay principal. of and interest on the Bonds on the next Interest
Payment Date, and second to pay the operation costs of the Project, Any such funds derived 0
from the Project not so expended shall. be retained in the Revenue Fund.
0
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(b) Debt Service Fund, into which the Housing Authority shall deposit Pledged S
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Revenues in an amount sufficient to pay, when due, the principal of and interest on the Bonds.
The funds on deposit in the Debt Service Fund, regardless of whether transferred from the Revenue Fund or from other sources, shall be used by the Housing Authority to pay, as and
.When due the principal of and interest on the Bonds. N
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The designation and establishment of the various funds and accounts in and by this N
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Resolution shall not be construed to require the establishment of any completely independent,
self-balancing funds as such term is corn only defined and used in governmental accounting,
but rather is intended solely to constitute an earmarking of certain revenues and assets for 0
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certain purposes and to establish certain priorities for application of such revenues and assets as
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herein provided,
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The Housing Authority hereby covenants that it will establish with the Lender in
accordance with the Commitment Letter, a "Project Account" into which, at the time of delivery
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of the Bonds herein authorized, shall be deposited the proceeds from the sale of the Bond, and
further covenants tliat it will open deposit accounts with the Lender for the Revenue Fund and
the Debt Service Fund.
SECTION 14. TAX COVENANT, The Housing Authority covenants to the purchasers of
the Bonds provided for in this Resolution that the Housing Authority shall not use or permit the
use of any amounts received by the Housing Authority with respect to the Bonds in any manner,
and shall not take or permit to be taken any other action or actions, which would cause the
Bonds to be a "private activity bond" within. the meaning of Section 141 or an "arbitrage bond"
within the meaning of Section 148, or "federally guaranteed" within the meaning of Section
149(b), of the Code or otherwise cause interest on such Bonds to become subject to federal
7 1 Packet Pg. 1783
H.4.e
income taxation.
The Housing Authority shall, at all times, do and perform all acts and things permitted
by law and this Resolution which are necessary or desirable in order to ensure that interest paid
on the Bonds will be excluded from gross income of the holders thereof for purposes of federal
income taxes and shall take no action that would result in such interest not being so excluded.
The Housing Authority shall pay or cause to be paid to the United State Government any
amounts required by Section 148(f) of the Code and the regulations thereunder (the
"Regulations"). In order to ensure compliance with the rebate provisions of Section 148(f) of the
Code with respect to the Bonds for which the Housing Authority intends on the date of issuance
thereof to be excluded from gross income for purposes of federal income taxation, the Housing
Authority hereby creates The "Housing Authority of the City of Key West, Florida Multifamily
Housing Revenue Bond (Washington Street Project) Rebate Account" (the 'Rebate Account") to
be held by the Housing Authority. The Rebate Account need not be maintained so long as the 0
Housing Authority timely satisfies its obligation to pay any rebatable earnings to the United
0
States Treasury; however, the Housing Authority may, as an administrative convenience,
maintain and deposit funds in the Rebate Account from time to time. Moneys in the Rebate
Account (including earnings and deposits therein) shall be held for future payments to the
United States Government as required by the Regulations.
SECTION 15. AMENDMENT. This Resolution shall not be modified or amended in any N
respect subsequent to the issuance of the Bond except with the written consent of all of the W
Owners of the Bonds. cv
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SECTION 16. LIMITATION OF RIGHTS. With the exception of any rights herein or
in the Loan Documents expressly conferred, nothing expressed or mentioned in or to be implied 0
from this Resolution or the Bonds is intended or shall be construed to give to any Person other
than the Housing Authority and the Owner any legal or equitable right, remedy or claim under
or with respect to this Resolution or any covenants, conditions and provisions herein contained;
except for such rights expressly conferred, this Resolution and all of the covenants, conditions ;
and provisions hereof being intended to be and being for the sole and exclusive benefit of the
Housing Authority and the Owner.
SECTION 17. BONDS MUTILATED, DESTROYED, STOLEN OR LOST. In case a
Bond shall become mutilated, or be destroyed, stolen or lost, the Housing Authority shall issue
and deliver a new Bond of like tenor as the Bond so mutilated, destroyed, stolen or lost, in
exchange and in substitution for such mutilated Bond, or in lieu of and in substitution for the
Bond destroyed, stolen or lost and upon the Owner furnishing the Housing Authority proof of
ownership thereof and indemnity reasonably satisfactory to the Housing Authority and
complying with such other reasonable regulations and conditions as the Housing Authority may
prescribe and paying such expenses as the Housing Authority may incur. The Bond so
surrendered shall be canceled.
8 Packet Pg. 1784
SECTION 1.8. IMPAIRMENT OF CONTRACT'. The Housing Authority covenants
with the Owners of the Bonds that it will not, without the written consent of the Owners of the
Bonds, or adopt any resolution which repeals, impairs or amends in any manner adverse to the
Owners the :rights granted to the Owners of the Bonds hereunder,
SECTION 19, FINANCIAL AND 0PERA'rING STATEMENT. The Housing
Authority shall deliver to the Lender, within ninety (90) days after the end of each fiscal year
.Y .0
beginning with fiscal year 2022, internally prepared financial statements of the Housing
Authority and the .Project. The Housing Authority will provide additional financial staternents,
prepared and certified by independent certified public accountants acceptable to the Lender 0
within '180 days of the fiscal year end. The Lender may require that Such financial statements be (n
audited. All financial statements and other financial information shall be prepared in accordance
with generally accepted accounting principles consistently applied.
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The l:lousing Auffiority also covenants to provide the Owners with.copies of the Housing a
0
.Authority's annual budget and capital improvernent plan. on an annual basis.
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SECTION 20. EVENTS OF DEFAULT; REMEDIES OF BONDHOLDER. The following
1hority fails to pay any payment of
shall constitute Events of Default:: (i) if the Housing Au
principal of, or interest on any Bond as the same becomes due and payable; (ii) if the Housing oo
.Authority defaults in the performance or observance of any covenant or agreement contained in N
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this Resolution, the Commitment, the Loan Documents or the Bonds (other than set forth in (i) W
C14
above) and fails to cure ,much default within the applicable cure and grace period provided. in the C14
C14
Loan Documents; or (iii) filing of a petition. by or against the Housing Authority relating to
bankruptcy, reorganization, arrangement or readjustment of debt of the Housing Authority or
.for any other relief relating to the liousing .Authority under the United. States BankruP tcy Code, 0
.
as armended, or any other insolvency act or law :now or hereafter existing, or the involuntary W
appointment of areceiver or trustee for the Ho using;.Authority, and the continuance of any such <
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event for 90 days undismissed or undischarged.
Up o:in the occurrence and during the continuation of any Event of Default, the Owner of
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the Bonds may, in addition to any other remedies set forth. in this Resolution, the Loan
Documents or the Bonds, either at law or in equity, by suit, action, mandunus or other
proceeding in any court of competent jurisdiction, protect and enforce any and all rights under
the laws of the State of Florida, or granted or contained in this Resolution., and may enforce and
compel the performance of all du ties :required by this Resolution, or by any applicable statutes to
be performed by the I lousing Authority or by any officer thereof.
SECTION 21. SEVER.A.BlU."I'Y. If any provisio-n of this Resolution shall be held or
deemed to be or shall, in fact, be illegal, inoperative or unenforceable in any context, the same
shall not affect any other provision herein or render any other provision (or such provision in
any other context)invalid, inoperative or unenforceable to any extent whatever.
9 Packet Pg. 1785
SECTION 22. BUSINESS DAYS. In any case where the due date of interest on or
principal of a Bond is not a Business Day, then payment of such.principal or interest shall not be
made on such date but shall be made on.the next succeeding Business Day, provided that credit
for payments made shall not be given,until the payment is actually received.by the Owner.
SECTION 23. APPLICABLE PROVISIONS OF LAW. This .Resolution shall be governed
by and construed in accordance with the laws of the State. .2
SEcTION 24. RULES OF INTERPRETATION. Unless expressly indicated otherwise, '10
references to sections or articles are to be construed as references to sections or articles of this 0
.0
instrument as originally executed. Use of the words "herein," "hereby," "hereunder," "hereof," (n
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"hereinbefore," "hereinafter" and other equivalent words refer to this Resolution and not solely to 0
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the particular portion in which any such word is used. 0
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SECTION 25. CAPTIONS. The captions and headings in this Resolution are for a
0
convenience only and in no way define, lin-dt or describe the scope or intent of any provisions or 0
sections of this Resolution.
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SECTION 26. MEMBERS OFTHE ISSUER EXEMPT FROMPERSONAL LIABILITY.
No recourse under or upon any obligation covenant or agreement of this Resolution. or the oo
C, 1 —
Bonds or for any claim based [hereon or otherwise in :respect thereof, shall be had against any N
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Housing Authority Members or employees of the Housing Authority, as such, of the .Housing W
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Authority, past, present or. future, either directly or through the Housing Authority, :it being C14
C14
expressly understood. that no personal habilfty whatsoever shall attach to, or is or shall be a
.2
incurred by, tine l-Iousing Authority Members or employees of the HousingAuffiority, as such,
uJider n or by reason of the obligations, covenants or agreernents contained in this Resolution, or 0
any Loan Documents or implied therefrom.
X
SECTION 27. AUT110RIZATIONS. To the extent that the Chairman, Vice-Chairman,
Secretary and/or Assistant Secretary of the Housing Authority are unable for any reason to
execute or deliver the documents referred to above, such documents maybe executed, attested
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and/or delivered by any other mernber of the 1-:lousing Authority, with the sarne effect as if
executed an-d/ or delivered by the Chairman, Vice-Chairman, Secretary or Assistant Secretary,
The Chairman, Vice Chairman and the Secretary and all other members of the Housing
Authority are hereby authorized and directed to (a) execute any and all certifications or other
instruments, agreements, assignments, endorsement or documents required by this Resolution,
the Commitment, Bond Counsel or any other document referred to above as a prerequisite or
precondition to the issuance of the Bonds, and any representation made therein, shall be deemed
to be made on behalf of the Housing Authority, and (b) to take all such. actions as shall be
necessary of advisable to carry out the transactions provided for in this Resolution. All action.
taken to date by the members of the Housin-gAu-thority and the staff of the Fi.ousing Authority in
furtherance of the issuance of the Bonds is hereby approved, confirmed and ratified.
10 1 Packet Pg. 1786
H.4.e
SECTION 28. BANK QUALIFIED. The Housing Authority hereby designates the Bonds
as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Code. The
Housing Authority and any subordinate entities of the Housing Authority (i.e., any entity that is
controlled by the Housing Authority within the meaning of Section 1.150-1(e) of the Income Tax
Regulations) and any issuer of "tax-exempt" debt that issues "on behalf of the Housing Authority
do not reasonably expect during the calendar year 2022 to issue more than $10,000,000 of "tax-
exempt" obligations including the Bonds, exclusive of any private activity bonds as defined in
Section 141(a) of the Code (other than qualified 501(c)(3) bonds as defined in Section 145 of the
Code). a
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SECTION 29. REPEALER All resolutions or parts thereof in conflict herewith are hereby
repealed.
SECTION 30. EFFECTIVE DATE. This Resolution shall be in full force and take effect 0
immediately upon its passage and adoption.
0
ADOPTED this 9th day of August,2022. E
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THE HOUSING AUTHORITY OF THE CITY
OF KEY WEST, FLORIDA
(SEAL) N
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ATTEST: CN
1u G. Parks,Jr.
hairman 0
By:
Ran(iall B. Stei*
Executive Director/Secretary
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11
Packet Pg. 1787
H.4.e
EXHIBIT LIST
EXHIBIT A-FORM OF BONDS
EXHIBIT B-FORM OF MORTGAGE AND SECURITY AGREEMENT
EXHIBIT C-FORM OF ASSIGNMENT OF LEASES AND RENTS
EXHIBIT D-FORM OF LOAN AGREEMENT
EXHIBIT E-FORM OF ENVIRONMENTAL INDEMNITY
EXHIBIT F-FORM OF PURCHASER'S CERTIFICATE
EXHIBIT G-FORM OF DISCLOSURE STATEMENT
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Packet Pg. 1788
H.4.f
EXHIBIT A
Lots 15 and 16, Block 14, Key West Investment Company, according to the Plat thereof recorded in Plat
Book 1, Page 69, Public Records of Monroe County, Florida.
AND
On the island of Key West and known on the Plat of the Key West Investment Company recorded in Plat
Book I at Page 69 as Lots 5 and 6 in Block 11 of Tract 17 and more particularly described as follows:
Commencing at a point on the Southeasterly side of Washington Street distant 200 feet in a Northeasterly
direction from the corner of the intersection of William Street and Washington Street and running thence
along the Southeasterly side of Washington Street in a Northeasterly direction 100 feet to a ten foot alley;
thence at right angles in a Southeasterly direction and along said alley 100 feet to a 10 foot alley; thence
at right angles in a Southwesterly direction 100' along said last mentioned alley; thence at right angles in
a Northwesterly direction 100 feet to the Point of beginning on Washington Street.
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Packet Pg. 1789
H.4.g
1111
HOUSING AUTHORITY
OF THE CITY OF KEY WEST, FLORIDA
1400 Kennedy Drive—Key West, FL 33040• Phone: 305-296-5621 •TTY/Florida Relay Service (FRS): 800-955-8771
Board of Commissioners Executive Director
John G. Parks,Jr. Randy Sterling
Bob Dean
Annette Mobley
Roosevelt C. Sands,Jr.
Frank Toppino
EXECUTIVE SUMMARY
To: The Monroe County Comprehensive Plan Land Authority (MCLA)
From: Randy Sterling, Executive Director
Pc: MCLA Advisory Committee
Date: September 1, 2022 0
RE: Washington Street Apartments
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Agenda Item:
Consideration of an agreement whereby Monroe County Land Authority (MCLA) will subordinate
it's Second and Third Mortgages to a new mortgage to be given by First State Bank of the Florida
Keys to the Housing Authority of the City of Key West, Florida (KWHA), in order to refinance the
existing mortgage and secure funding for rehabilitation of units at 817, 818, 819, & 820 E
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Washington Street.
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Background:
On July 6, 2010 the KWHA took title to said real property by virtue of a Warranty Deed. The MCLA
made two mortgage loans as follows, for a total of$1,636,000:
1) a 30-year zero interest balloon second mortgage for$836,000 to be repaid in full in July
2040and
2) a 30-year soft third mortgage for$800,000 (forgivable in July 2040).
These mortgages were given in exchange for an MCLA deed restriction that requires the dwelling
units to be rented for families whose income is below 160% of the median income for the area.
Land Authority funding may only be used for projects that meet this requirement, according to
Section 380.0666(3).
pPPpWSWNunv
Packet Pg. 1790
H.4.g
Current Request:
The KWHA is in the process of re-financing the Washington Street Apartments in order to make
some necessary repairs to the property. The KWHA needs MCLA to subordinate to the first
mortgage held by First State Bank. The current situation is as follows:
• Current outstanding 111 mortgage is $898,292
• KWHA is seeking$596,400 in equity to make repairs
• Total First mortgage will now be $1,494,692
• Appraised Value of the property without the improvements is$4,410,000.
The KWHA has provided a 20 year proforma that demonstrates the viability of the new loan, as
well as the MCLA payback. At the point in time in which the MCLA loan is to be paid back (July,
2040), the balance remaining on the 1st mortgage is expected to be $136,959. If necessary, KWHA
could restructure debt again to satisfy the MCLA debt.The proforma shows the KWHA setting aside
funding each year to payback the MCLA 2nd Mortgage.
Action by MCLA Needed:
Approval of Subordination Agreement between Monroe County Comprehensive Plan Land
Authority and First State Bank of the Florida Keys whereby Monroe County Land Authority(MCLA)
will subordinate it's Second and Third Mortgages (not deed restrictions) to a new mortgage to be
given by First State Bank of the Florida Keys to the Key West Housing Authority, in order to
refinance the existing mortgage and secure funding for rehabilitation of units at 817, 818, 819 &
820 Washington Street.
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Packet Pg. 1791