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HomeMy Public PortalAboutSPLOST 14 Intergovernmental Agreement 9-9-13.pdfSTATE OF GEORGIA ) COUNTY OF CHATHAM ) INTERGOVERNMENTAL AGREEMENT FOR THE USE AND DISTRIBUTION OF PROCEEDS FROM THE 2014 SPECIAL PURPOSE LOCAL OPTION SALES TAX FOR CAPITAL OUTLAY PROJECTS THIS AGREEMENT (this Agreement) is made and entered this q�ay of September, 2013, by and between Chatham County, a political subdivision of the State of Georgia (the County), and the Mayor and Aldermen of the City of Savannah, a municipal corporation and a political subdivision of the State of Georgia (City) WITNESSETH: WHEREAS, O.C.G.A. § 48-8-110 et seq. (the Act), authorizes the levy of a one percent special purpose local option sales tax for the purpose of financing capital outlay projects for the use and benefit of the County and qualified municipalities within the County; and WHEREAS, the County, City, as well as other municipal corporations, met on June 18, 2013, in compliance with the requirements of O.C.G.A. § 48-8-111(a), to discuss possible projects for inclusion in an election to be held on November 5, 2013 for the purpose authorizing the reimposition of the special purpose local option sales tax now in effect in Chatham County and presently expected to terminate on September 30, 2014; and WHEREAS, the County and City have negotiated a division of the Special Purpose Local Option Sales Tax (SPLOST) to be collected in the event a majority of the votes cast in the election are in favor of reimposing the SPLOST; and WHEREAS, the parties hereto anticipate that the County will enter into separate agreements with the other municipalities in the County (the "Municipalities') providing for the distribution of a portion of SPLOST proceeds to such other municipalities to fund allowable capital outlay projects which will be authorized by the referendum to be held on November 5, 2013, if passed; and WHEREAS, the County, the City, and the Municipalities, and all citizens of the County will derive substantial benefits from the proposed projects to be funded by SPLOST proceeds distributed pursuant to this Agreement; and WHEREAS, the County has been asked to submit to the qualified voters of the County at an election to be held November- 5, 2013, the question of whether the voters will approve the Special Sales Tax and the issuance of up to $30,000,000 of general obligation debt of the County (the "Bonds"); and WHEREAS, the County determined that it is in its best interests to fund a portion of the County Projects from the proceeds of the Bonds; and Page 1 WHEREAS, it is necessary that the County set forth its respective legal rights, responsibilities, and obligations regarding the proposed issuance of the Bonds. NOW, THEREFORE, in consideration of the mutual promises and understandings made in this Agreement, and for other good and valuable consideration, the County and the City consent and agree as follows: Section 1. Representations and Mutual Covenants A. The County makes the following representations and warranties which maybe specifically relied upon by all parties as a basis for entering this Agreement: (i) The County is a political subdivision duly created and organized under the Constitution and laws of the State of Georgia; (ii) The governing authority of the County is duly authorized to execute, deliver and perform this Agreement; (iii) This Agreement is a valid, binding, and enforceable obligation of the County; and (iv) The County will take all actions necessary to call an election to be held in all voting precincts in the County on the 5th day of November, 2013, for the purpose of submitting to the voters of the County for their approval, the question of whether or not a SPLOST shall be imposed on all sales and uses within the special district of Chatham County for a period of 24 quarters (6 years), commencing as provided in Section 4, to raise an estimated $370,000,000 to be used for funding the projects specified in Exhibit A attached hereto. (v) Net proceeds of the Bonds shall be deposited into a special trust account as further outlined herein of the County to be used for the acquisition and construction of the County Projects. The Bonds shall be a general obligation debt of the County. Prior to or concurrently with the issuance and delivery of the Bonds, the County shall make contract payments of the principal of and interest on the Bonds. To the extent the proceeds of the Special Sales Tax are insufficient, the County shall levy an ad valorem tax on all taxable property located within the limits of the special district subject to taxation for such purposes, at such rate or rates as may be necessary to produce revenues to pay such debt service payments, and to certify that it will take no actions that would impair the exclusion of interest on the Bonds from federal income taxation. B. The City makes the following representations and warranties which may be specifically relied upon by all parties as a basis for entering this Agreement: (i) The City is a municipal corporation duly created and organized under the laws of the State of Georgia; Page 2 (ii) The governing authority of the City is duly authorized to execute, deliver and perform this Agreement; (iii) This Agreement is a valid, binding, and enforceable obligation of the City; (iv) The City is a qualified municipality as defined in O.C.G.A. § 48-8-110 (4); and (v) The City is located entirely or partially within the geographic boundaries of the special tax district created in the County. C. It is the intention of the County and City to comply in all respects with O.C.G.A. § 48-8-110 etseq. and all provisions of this Agreement shall be construed in light of O.C.G.A. § 48-8-110 et seq. Section 2 . Restrictions as to Use of Tax Funds. A. The City and the County shall comply with all requirements of Georgia law pertaining to all SPLOST funds each receives, including but not limited to the following: (i) All SPLOST funds and interest received may only be used for projects described in Exhibit A. If circumstances arise which dictate that a project which initially seemed feasible is no longer so, then the governing body to which the SPLOST funds for such project was allocated under this Agreement, may use its lawful discretion to make adjustments in its plan of capital projects. In the event that the cost to complete a project is less than the amount allocated to that project under this Agreement, then the governing body to which the SPLOST funds for such project were allocated, may use its lawful discretion to make adjustments in its plan of capital projects to utilize the funds for other projects provided for in this Agreement. This provision shall be construed in light of O.C.G.A. § 48-8-123. (ii) All SPLOST funds received shall be accounted for in a separate fund as more fully described herein and not commingled with other monies prior to expenditure for allowable uses. (iii) Interest earned from the investment of SPLOST funds prior to their disbursement for allowable expenditures shall be considered SPLOST funds and used under the same restriction for SPLOST funds as set forth in subparagraph (i) above. (iv) No SPLOST funds received may be used for general operating expenses. SPLOST funds may be used to repay loans made to temporarily fund SPLOST capital projects in anticipation of receipt of SPLOST funds. B. The County and City agree to proceed with the acquisition, construction, design, permitting, equipping and installation of the projects specified in Exhibit A of this Agreement, subject to the availability of funds. Page 3 C. The County and City agree that each approved SPLOST project associated with this Agreement shall be maintained as a public facility and in public ownership. If ownership of a project financed pursuant to this Agreement is transferred to private ownership within 10 years of the SPLOST expiration, the proceeds of the sale shall, for the purposes of this Agreement, be deemed excess funds and disposed of as provided under O.C.G.A. § 48-8-121 (g)(2)• D. The County and City agree to maintain thorough and accurate records concerning receipt of SPLOST proceeds and expenditures for each project undertaken as required to fulfill the terms of this Agreement. Section 3. Conditions Precedent A. The obligations of the County and City pursuant to this Agreement are conditioned upon the adoption of a resolution of the County calling for the imposition of the SPLOST in accordance with the provisions of O.C.G.A. § 48-8-111 (a). B. This Agreement is further conditioned upon the approval of the proposed imposition of the SPLOST by the voters of the County in a referendum to be held in accordance with the provisions of O.C.G.A. § 48-8-111 (b) through (e). C. This Agreement is further conditioned upon the collecting of the SPLOST revenues by the State Department of Revenue and transferring same to the County. Section 4. Effective Date and Term of the Tax The SPLOST, subject to approval in an election to be held on November 5, 2013, shall continue for a period of six years with collections beginning on the earlier of October 1, 2014 or the termination of the special purpose local option sales tax now in effect. Section 5. Effective Date and Term of This Agreement This Agreement shall commence upon the date of its execution and shall terminate upon the later of- A. f A. The official declaration of the failure of the election described in this Agreement; or B. The expenditure by the County and City of the money collected from the SPLOST. Section 6. County SPLOST Fund; Separate Accounts; No Commingling A. Should the County elect not to validate the bonds issued as a part of the special election, then the County shall create a separate fund by the County and designated as the 2014 Chatham County Special Purpose Local Option Sales Tax Fund (SPLOST Fund). The County shall select a local bank which shall act as a depository and custodian of the SPLOST Fund upon such terms and conditions as may be acceptable to the County. However, prior to Page 4 or concurrently with the issuance and delivery of the Bonds, the County will create and establish with a bank designated by the County three special accounts which shall be designated as the COUNTY 2013 SPECIAL COUNTY ONE PERCENT SALES AND USE TAX PROCEEDS ACCOUNT (the "SPLOST FUND "), the COUNTY GENERAL OBLIGATION SALES TAX BONDS, SERIES 2013 DEBT SERVICE ACCOUNT (the "County Debt Service Account 2013") and the COUNTY 2013 ELECTION COUNTY PROJECTS ACCOUNT (the "County Projects Account 2013"). Money in each of said accounts shall be held separate and apart from all other funds of the County and shall not in any manner be comingled with other funds of the County. B. The City shall create a special fund to be designated as the 2014 City of Savannah Special Purpose Local Option Sales Tax Fund. The City shall select a local bank which shall act as a depository and custodian of the SPLOST proceeds received by the City upon such terms and conditions as may be acceptable to the City. C. All SPLOST proceeds shall be maintained by the County and the City in the separate accounts or funds established pursuant to this Section. Except as provided in Section 7, SPLOST proceeds shall not be commingled with other funds of the County or City and shall be used exclusively for the purposes detailed in this Agreement. No funds other than SPLOST proceeds and related revenues shall be placed in such funds or accounts. Section 7. Procedure for Disbursement of SPLOST Proceeds A. Upon receipt by the County of SPLOST proceeds collected by the State Department of Revenue, the County shall immediately deposit said proceeds in the SPLOST Fund. The monies in the SPLOST Fund shall be held and applied to the cost of acquiring, constructing and installing the capital outlay projects listed in Exhibit A and as provided in Paragraph B of this Section. B. In accordance with O.C.G.A. §48-8-121(e), part of the proceeds of the tax will be used for the payment of the Bonds. No part of the net proceeds from the tax received in any Bond Year shall be used for any other purposes whatsoever until all debt service requirements of the Bonds for that Bond Year have first been satisfied from the SPLOST Fund. C. After the County Debt Service Account 2013 has sufficient money therein to pay the principal of and interest coming due on the Bonds in the then current Bond Year, all remaining proceeds of the Special Sales Tax subsequently received in said Bond Year (the "Unencumbered Distributions") shall be distributed by the County to the City for its projects in accordance with the percentages provided by this Intergovernmental Agreement in Exhibit A, provided, however, that the amount distributed to the County Debt Service Account 2013 shall be deemed to be a portion of the percentage assigned to the County and that the distribution percentages for the Unencumbered Distributions shall be adjusted so as to cause the total distribution of all SPLOST proceeds (being the sum of distributions to the County Debt Service Account and Unencumbered Distributions) for the Bond Year shall be as provided by Exhibit A. Page 5 D. The County will be responsible for distributing such remaining proceeds in accordance with the Notice of Election and Exhibit A. E. The County, following deposit of the SPLOST proceeds in the SPLOST Fund, shall disburse the pro -rata share of SPLOST proceeds due to City within 30 business days of such deposit according to the schedule in Exhibit A. The proceeds shall be deposited in the separate funds established by the City in accordance with Section 6 of this Agreement. The City shall hold and apply the monies so deposited against the cost of acquiring, constructing and installing the capital outlay projects or the retirement of general obligation debt listed in Exhibit A. F. The proceeds of the Special Sales Tax shall be distributed between County, City and the other municipalities in accordance with Exhibit A. G. Should any Municipality cease to exist as a legal entity before all funds are distributed under this Agreement, that Municipality's share of the funds subsequent to dissolution shall be paid to the County as part of the County's share unless an act of the Georgia General Assembly makes the defunct Municipality part of another successor municipality, in which event the defunct Municipality's share shall be paid to the successor Municipality in addition to all other funds to which the successor Municipality would otherwise be entitled. Section 8. Proiects All capital outlay projects, to be funded in whole or in part from SPLOST proceeds, are listed in Exhibit A which is attached hereto and made part of this Agreement. The Notice of Election calling for the imposition of the tax is also herein specifically referenced and made a part of this agreement. Section 9. Priority and Order of Proiect Funding Projects shall be fully or partially funded in accordance with the schedule set forth in Exhibit A of this Agreement. Except as provided in Paragraph B and Paragraph C of Section 10 of this Agreement, any change to the priority or schedule must be agreed to in writing. Section 10. Completion of Projects A. The County and City acknowledge that the costs shown for the County's and the City's respective projects described in Exhibit A are estimated amounts. As listed in Exhibit A, should SPLOST proceeds be insufficient to complete any capital outlay project, then the responsibility for additional funding and completion shall rest with the entity responsible for the project. B. If a County project has been satisfactorily completed at a cost less than the estimated cost listed for that project in Exhibit A, the County may apply the remaining unexpended funds to any other County project in Exhibit A. Page 6 C. If a City or other municipal project has been satisfactorily completed at a cost less than the estimated cost listed for that project in Exhibit A, then the City or Municipality may apply the remaining unexpended funds to any other project included for the City or that Municipality in Exhibit A, or as otherwise provided by law. Section 11. Expenses The County shall administer the SPLOST Fund to effectuate the terms of this Agreement and shall be reimbursed for the actual costs of administration of the SPLOST Fund from the County's SPLOST allocation as determined by Exhibit A. Section 12. Retention of Records The parties agree to retain all records pertaining to the SPLOST funds for a period of four years subsequent to the expiration of the SPLOST and to make such records reasonably available to each other upon request. Section 13. Use of SPLOST Funds The County, the City and the Municipalities shall use the SPLOST funds only for SPLOST eligible projects. Section 14. Other Requirements. The parties agree that they each will abide by any other requirements regarding the use and accounting for SPLOST funds as specified by Georgia law, and in the event that any party fails to follow all applicable requirements of Georgia law, it shall hold all other parties harmless for any such failure. Section 15. Agreement Effective When Executed by the City and Countv This Agreement shall be effective when executed by Savannah and the County. The County may enter into separate agreements with other Municipalities that are not signatories to this Agreement and other organizations upon such terms as appropriate to insure that funds will be used for SPLOST eligible projects and meet the requirements of the law. If there is an inconsistency between such agreements and this Agreement regarding the distribution and allocation terms, this Agreement shall govern. Section 16. Audits A. During the term of this Agreement, the distribution and use of all SPLOST proceeds shall be audited annually by an independent certified public accounting firm in accordance with O.C.G.A. § 48-8-121 (a)(2). The County and City receiving SPLOST proceeds shall be responsible for the cost of their respective audits. The County and City agree to cooperate with the independent certified public accounting firm in any audit by providing all necessary information. Page 7 B. The City shall provide the County a copy of the audit of the distribution and use of the SPLOST proceeds by the City. Section 17. Notices All notices, consents, waivers, directions, requests or other instruments or communications provided for under this Agreement shall be deemed properly given when delivered personally or sent by registered or certified United States mail, postage prepaid, as follows: If to County: R. E. Abolt, County Manager Chatham County PO Box 8161 Savannah, GA 31412 If to Savannah: Stephanie S. Cutter, City Manager City of Savannah PO Box 1027 Savannah, GA 31402 Section 18. Entire Agreement This Agreement, including any attachments or exhibits, constitutes all of the understandings and agreements existing between the County and City with respect to distribution and use of the proceeds from the SPLOST. Furthermore, this Agreement supersedes all prior agreements, negotiations and communications of whatever type, whether written or oral, between the parties hereto with respect to distribution and use of the SPLOST funds authorized by the November 5, 2013 referendum. Section 19. Amendments This Agreement shall not be amended or modified except by agreement in writing executed by the governing authorities of the County and City. Section 20. Governing Law This Agreement shall be deemed to have been made and shall be construed and enforced in accordance with the laws of the State of Georgia. Section 21. Severability Should any phrase, clause, sentence, or paragraph of this Agreement be held invalid or unconstitutional, the remainder of the Agreement shall remain in full force and effect as if such invalid or unconstitutional provision were not contained in the Agreement unless the elimination of such provision detrimentally reduces the consideration that any party is to receive under this Agreement or materially affects the operation of this Agreement. Page 8 Section 22. Compliance with Law The County and City shall comply with all applicable local, State, and Federal statutes, ordinances, rules and regulations. Section 23. No Consent to Breach No consent or waiver, express or implied, by any party to this Agreement, to any breach of any covenant, condition or duty of another party shall be construed as a consent to or waiver of any future breach of the same. Section 24. Counterparts This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 25. Mediation The County and City agree to submit any controversy arising under this Agreement to mediation for a resolution. The parties to the mediation shall mutually select a neutral party to serve as mediator. Costs of mediation shall be shared equally among the parties to the mediation. (Signatures on the following page) Page 9 IN WITNESS WHEREOF, the County and the City acting through their duly authorized agents have caused this Agreement to be signed, sealed and delivered for final execution by the County as of the date set forth above. CHATHAM COUNTY, GEORGIA By: _ 4kaxu: Albert J. Cott, Chairman (Seal) Attest: r(dYN� ice Bocook, Clerk of Commission MAYOR AND ALDERMEN OF THE CITY OF SAVANNAH, GEORGIA By: r--�- Stephanie S. Cutter, City Manager Attest, � 4�w� Dyanne C. se, Clerk of Council Page 10 (Seal) EXHIBIT A Projects and Priorities for SPLOST Distribution 1. SPLOST Proiects. The table below lists the SPLOST projects, the entity responsible for the project, the project priority for SPLOST funding, and the pro -rata share of the SPLOST monthly distribution. 2. Distribution of SPLOST Proceeds. All SPLOST collections up to $370,000,000 shall be distributed to the County and the Municipalities on a monthly basis based upon each entity's pro -rata percentage of the project totals based on Distribution Table below after bond obligations outlined in O.C.G.A. § 48-8-121(e) are satisfied; provided, however, that the amount distributed to the County Debt Service Account 2013 shall be deemed to be a portion of the percentage assigned to the County and that the distribution percentages for the Unencumbered Distributions shall be adjusted so as to cause the total distribution of all SPLOST proceeds (being the sum of distributions to the County Debt Service Account and Unencumbered Distributions) for the Bond Year shall be as provided by the Distribution Table below. Should the total tax collection exceed $370,000,000 during the six year collection cycle, then SEDA would receive an additional amount not to exceed $15,000,000 from the collected funds over the $370,000,000. Such distribution of the tax at that time shall be solely collected by the County and given to Savannah Economic Development Authority (SEDA) pursuant to an intergovernmental contract or contracts until SEDA has received an amount not to exceed a total of $30,000,000. Should SPLOST proceeds exceed $385,000,000, the remaining SPLOST proceeds will be allocated to the City for an arena. Should SPLOST proceeds exceed $400,000,000, the remaining SPLOST proceeds will be allocated between the County and the Municipalities on a pro rata population basis. The County's share of the SPLOST proceeds in excess of $400,000,000 shall be based upon the ratio of the unincorporated population of the County relative to the total County population. Each Municipality's share of the SPLOST proceeds in excess of $400,000,000 shall be based upon the ratio of that Municipality's population relative to the total County population. The source for the population figures shall be the final 2010 Decennial Census figures compiled by the U.S. Census Bureau. Said excess proceeds shall be used to fund allowable projects under the terms of this agreement or as otherwise provided for in law. 3. Proiects within Municipalities. For capital outlay projects (i.e. that include but are not limited to roads and drainage) that are located wholly within a Municipality, it is agreed that the final design plans shall be approved by the Municipality. For such projects, the County and a Municipality may have a separate agreement to transfer SPLOST funds to the Municipality which shall assume the responsibility for detailed design, construction procurement and construction management of the project. Exhibit A-1 4. Issuance of General Obligation Debt. If imposition of the tax is approved by the voters, such vote shall also constitute approval of the issuance of general obligation debt of Chatham County in the principal amount not to exceed $30,000,000 for County projects. If such special purpose sales and use tax is to be imposed, Chatham County, acting by and through the Board of Commissioners of Chatham County, may issue general obligation debt, in an aggregate principal amount not to exceed $30,000,000. The proceeds from such general obligation debt, if issued, shall be used to fund all or a portion of the projects described in the foregoing question. The maximum interest rate paid per year shall not exceed six percent annum. The maximum amount of principal to be paid in each year during the life of the debt shall be as follows: Year Principal Amount Maturing 2016 $15,000,000 2017 $15,000,000 The Board of Commissioners may issue aggregate general obligation debt which is less than $30,000,000 and reduce the principal amount maturing shown above. (Distribution Table Follows) Exhibit A-2 DISTRIBUTION TABLE FOR S370,000,0 0 IN SPLOST PROCEEDS Project Project Responsible Projected Pro Rata Number Entity SPLOST Share* Allocation (%) 1 CSavannah projects including roads, City of $ 190,000,000 51.3514 streets and bridges; storm water and drainage; Savannah an arena; cultural and recreational facilities; fire protection and public safety facilities and equipment, capital outlay projects to support the community's economic growth and capital outlay projects to promote neighborhood vitality. See notes. 2 City of Bloomingdale projects including roads, City of $ 3,200,000 0.8649 streets and bridges; storm water and drainage, Bloomingdale cultural and recreational facilities, and public safety facilities and equipment. See notes. 3 City of Garden City projects including roads, City of Garden $ 8,085,000 2.1851 streets and bridges; cultural and recreational City facilities, parks, fire facilities and equipment, public safety facilities and equipment and acquisition of judicial and municipal facilities. See notes. 4 City of Pooler projects including roads, streets City of Pooler $ 16,900,000 4.5676 and bridges; recreational facilities; public safety facilities and equipment. See notes. 5 City of Port Wentworth projects including City of Port $ 6,200,000 1.6757 roads, streets and bridges; recreational facilities Wentworth and parks; sewers; and downtown redevelopment. See notes. 6 Town of Thunderbolt projects including roads, Town of $ 3,750,000 1.0135 streets and bridges; storm water and drainage; Thunderbolt water and sewer; public works and public safety vehicles and equipment; fire protection; and administrative facilities. See notes. 7 City of Tybee Island projects including roads, City of Tybee $ 4,200,000 1.1351 streets and bridges; storm water and drainage; Island recreational facilities; public safety and fire protection facilities and equipment; and water and sewer. See notes. 8 Town of Vernonburg projects including roads, Town of $ 150,000 0.0405 streets and bridges; public safety facilities and Vernonburg equipment; and gas lines. See notes. Exhibit A-3 9 Unincorporated County projects including Chatham $ 137,515,000 37.1662 roads, streets and bridges; storm water and County drainage; cultural, recreational, judicial, and industrial facilities; libraries; public safety and fire protection facilities and equipment; greenspace; public transit equipment and facilities; and retirement of debt. See notes. Total: ,$ 370,000,000 100.0000 Notes: * Pro rata share governs distribution up to $370,000,000; see Exhibit A, Paragraph 2. (1) Projects may be from the County or Municipality Adopted Capital Improvement Program. (2) County will collect SEDA's proceeds and distribute the same per an intergovernmental contract(s). (3) County will provide up to $6 million to Tybee Island for beach improvements. Exhibit A-4