Title
Ordinance No. 16-94 authorizing the execution and delivery by the City of Colorado Springs (City) of a site lease between the City as lessor and a financial institution to be identified, and, in connection therewith, a lease purchase agreement between the City, as lessee, and such financial institution, with respect to certain real property for the purpose of financing the construction and improvement of a police substation; authorizing officials of the City to take all action necessary to carry out the transactions contemplated hereby and providing for related matters
Presenter:
Kara Skinner, Chief Financial Officer
Tom Florczak, Deputy City Attorney
Body
Summary:
The City is requesting approval to finance, through a lease/lease-purchase agreement, the construction and improvement of the new Sand Creek Police Substation. The attached ordinance approves a lease/lease purchase agreement within specific parameters: principal amount not to exceed $14 million, an interest rate not to exceed 3.0%, and a term not to exceed 10 years. The financial institution proposal the City has selected, Bank of America Merrill Lynch, uses the following pricing formula: Index Rate + Margin. The Index Rate is based upon the 6-year and 7-year LIBOR Swap Rates and the Margin is 40 basis points. At the time of proposal, the total interest rate was 1.61% (1.21%+0.40%). The actual interest rate and will be locked two days prior to closing.
Previous Council Action:
On August 22, 2016, City staff briefed City Council on the proposed lease/lease-purchase agreement. At that time, the City was awaiting proposals in response to a competitive Request for Proposals led by RBC, the City's direct placement agent for the proposed transaction.
On August 11, 2015, City Council approved Resolution No. 80-15 authorizing the acquisition of land for a new, more appropriately sized Sand Creek Police Substation (Substation).
On November 25, 2015, City Council approved the or...
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