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HomeMy WebLinkAboutR-86-0976J-o6-1049 12/10/86 RESOLUTION NO. QQ��•�Q'�" • ci"_�b - A RESOLUTION AUTHORIZING THE CITY MANAGER TO TERMINATE AN AGREEMENT DATED JULY 20, 1983, BETWEEN THE SOUTH FLORIDA ECONOMIC DEVELOPMENT CORPORATION, INC. (SFEDC) AND THE CITY OF MIAMI; SAID AGREEMENT TO BE TERMINATED IN ACCORDANCE WITH CONTRACT PROVISION NUMBER 13; FURTHER AUTHORIZING THE CITY MANAGER TO DIRECT THE CITY ATTORNEY TO COLLECT THE PRINCIPAL AMOUNT OF SAID LOAN ALONG WITH ANY INTEREST DUE FROM SOUTH FLORIDA ECONOMIC DEVELOPMENT CORPORATION, INC. WHEREAS, this program was approved in the Eighth (8th) Year Community Development Program; and WHEREAS, the City Commission passed Resolution 83-484 authorizing and directing the City Manager to loan fifty thousand dollars ($50,000) to South Florida Economic Development Corporation, Inc. at a rate of three percent (3%) for a five (5) year period; and WHEREAS, the South Florida Economic Development Corporation has been granted a Credit Union Charter by the National Credit Union Administration (NCUA) to participate in its Community Federal Credit Union Program as a sponsoring agency; and WHEREAS; said funds were deposited with the Dade -Model Cities Community Federal Credit Union for the purpose of creating risk loans for residents, employers and employees of the Model Cities Target Area; and WHEREAS, the Dade -Model Cities Community Federal Credit Union has been declared insolvent and all administrative and fiscal matters are being handled by the National Credit Union Administration in Washington, D.C.; CITY COMMISSION MEETING OF DEC n tigbb � c RLSOLUTION No.8G,,%76 MARKS NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. The City Manager is hereby authorized to loan terminate an/agreement dated July 20, 1983 between the City of Miami and the South Florida Economic Development Corporation as outlined under contract provision number 13 of said agreement. Section 2. The City Manager is hereby authorized to direct the City Attorney to collect principal and interest due, as a result of said loan, from South Florida Economic Development Corporation within one hundred and twenty (120) days of contract termination. PASSED December ATT E,ST : r MATTY HIRAI CITY CLERK AND ADOPTED this . 1986. PREPARED AND APPROVED BY: n OBERT F. CLARK CHIEF DEPUTY CITY ATTORNEY APPROVED )CS/TO FORM AND CORRECTNESS: LUCLA A: DOUG CITY ATTORNEY llth. day of XAVIER L. S&AEZ MAYOR -2- _ CITY OF MIAMI. FLORIDA INTER -OFFICE MEMORANDUM TO: The Honorable Mayor and Members DATE: DEC 51� FILE: of the City Commission SUBJECT: Resolution authorizing the City Manager to terminate an agreement with the South F"": l Florida Economic Development Cesar H. Odio J REFERE"CEs`Corporation, Inc. City Manager �j , ENCLOSURES: RECOMMENDATION: It is respectfully recommended that the City Commission adopt the attached resolution authorizing the termination of an agreement, in substantially the form attached hereto, between the South Florida Economic Development Corporation and the City of Miami for the purpose of providing financial assistance to the Dade - Model Cities Community Federal Credit Union thereby creating risk loans for low-income residents and businesses in the Model Cities Target Area, in accordance with the terms and conditions as set forth therein. BACKGROUND: The Department of Community Development (DCD) has analyzed the need to terminate the agreement dated July 20, 1983 between City of Miami and the South Florida Economic Development Corporation, Inc. The termination of said agreement is in accordance with contract provision number thirteen (13) of the aforementioned agreement. The Department of Community Development allocated fifty thousand dollars ($50,000) of Eighth (8th) Year Community Development Funds to the South Florida Economic Development Corporation. Upon approval of said allocation by the City Commission, an agreement was entered into with South Florida Economic Development Corporation, Inc. loaning the agency fifty thousand dollars ($50,000) with interest to accrue at the rate of three percent (3%) per annum. These funds were then immediately placed on deposit with the Dade -Model Cities Community Federal Credit Union Program. Since South Florida Economic Development Corporation had been granted a Credit Union Charter by the National Credit Union Administration, as a sponsoring agency, the funds allocated were used to capitalize the Dade -Model Cities Credit Union thereby creating risk loans and venture capital pools to assist homeowners and small businesses in the Model Cities Area. es-s76. a s The Honorable Mayor and Members of the City Commission Page 2 Although the Dade —Model Cities Credit Union was successful in disbursing the allocated funds, unfortunately, due to inadequate fiscal controls ,the agency was declared insolvent by the National Credit Union Administration (NCUA). The local agency is no longer in operation and all accounts receivable and/or payable are being handled by the NCUA. Since our agreement is with the South Florida Economic Development Corporation, they are responsible to the City of Miami for the repayment of allocated funds both principal and interest. The recapture of the aforementioned funds will be placed into the Community Development Block Grant contingency account and reallocated at a later date. 86-9'7,6 .