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HomeMy Public PortalAboutResolution 08-04 Chapter 9 Petition - signedRESOLUTION NO. 08-4 A RESOLUTION OF THE CITY OF MCCALL, IDAHO AUTHORIZING THE FILING OF A PETITION IN THE UNITED STATES BANKRUPTCY COURT IN AND FOR THE DISTRICT OF IDAHO SEEKING RELIEF UNDER TITLE 11 U.S.C.A CHAPTER 9 OF THE UNITED STATES BANKRUPTCY CODE, 11 U.S.C. §§ 101, ET SEQ.; AND PROVIDING FOR THIS RESOLUTION TO BE EFFECTIVE UPON ITS PASSAGE AND APPROVAL WHEREAS, this Resolution is made on the 5-day of February, 2008 by the City of McCall, Idaho ("City"); and WHEREAS, the City is a duly incorporated political subdivision of the State of Idaho; and WHEREAS, the City has determined that it cannot satisfy the Judgments ("Judgments") entered against it in the case styled Wausau v. City of McCall, et al., United States District Court in and for the District of Idaho (Case No. CIV 1:01-629), in accordance with the Orders entered by the Court in that Case; and WHEREAS, the City has paid to Wausau on account of the Judgments those funds available to the City under applicable State law; WHEREAS, the City is of the opinion that it has been ordered to pay more than it is authorized under State law to pay, and has been unable to find lenders willing to lend to the City to satisfy the Judgments on terms consistent with the City Council's statutory and fiduciary duties on behalf of the citizens of McCall; and WHEREAS, the City has attempted good faith negotiations regarding satisfaction of the Judgments, but Wausau has declined to negotiate the Judgments; and WHEREAS, negotiations are impracticable in the absence of a decision by the Ninth Circuit Court of Appeals or the Supreme Court of Idaho regarding the City's constitutional and statutory ability to raise funds to pay the Judgments; and WHEREAS, the City desires to reorganize and restructure its finances in an effort to adjust its debts in a fair and equitable manner to its constituents, including its creditors, taxpayers and rate payers while continuing to provide essential services to its citizens and the surrounding community; and WHEREAS, on the 25th day of February, 2008, the City held a Special Public Meeting to discuss how it may proceed in light of the financial distress caused by the Judgments and Orders entered against it in the Wausau matter; and WHEREAS, the City has determined that it is in the best interests of its citizens and the surrounding community to reorganize and restructure its finances in an effort to provide essential services to its citizens and the surrounding community; and WHEREAS, the City is authorized to file or cause to be filed a Petition in the United States Bankruptcy Court in and for the District of Idaho, seeking relief under Chapter 9 of the United States Bankruptcy Code, 11 U.S.C. §§ 101, et seq. RESOLUTION NO. 08-4 - 1 NOW, THEREFORE, IT IS HEREBY RESOLVED BY THE CITY COUNCIL AND THE CITY OF MCCALL, IDAHO: Section 1: The City hereby authorizes the filing of a Petition in the United States Bankruptcy Court in and for the District of Idaho, seeking relief under Chapter 9 of the United States Bankruptcy Code, 11 U.S.C. §§ 101, et seq. Section 2: That this Resolution constitutes the necessary action of the City to file its Petition under Article VIII § 3 and Article XII § 2 of the Idaho Constitution and Idaho Code § 50- 301 and Idaho Code § 67-3901, et seq. Section 3: This Resolution authorizes the City to retain the law firms Seyfarth Shaw LLP and Trout Jones Gledhill Fuhrman, P.A. and such other professionals as the Mayor or City Council shall designate to file the City's Petition and represent the City in the Bankruptcy Proceedings and in all proceedings commenced under or resulting from this Resolution. Section 4: The Mayor, the City Clerk, and City Staff, as well as legal counsel to the City, are hereby authorized and directed to take all necessary and convenient steps to file said Petition, and all related Schedules and other documents, to appear and represent the City as necessary in the Bankruptcy Proceedings, and to obtain confirmation of a Plan of Reorganization under Chapter 9 of the United States Bankruptcy Code, 11 U.S.C. §§ 101, et seq. Section 5: That any and all actions heretofore or hereafter taken in the name of or on behalf of the City in good faith by any of said persons or entities in furtherance of the purpose of the foregoing Resolutions or in connection with the transactions contemplated therein are hereby ratified, confirmed and adopted as the acts of the City. Section 6: This Resolution authorizes the City's legal counsel in the Bankruptcy Proceeding to take all reasonable actions it deems necessary to protect the City's interests. Section 7: That this Resolution shall be in full force and effect immediately upon its adoption and approval. ADOPTED AND APPROVED THIS o?S -day of February, City of McCall By: Attest: By: Fred uie1, Acting City Clerk za, Mayor / RESOLUTION NO. 08-4 - 2