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HomeMy WebLinkAboutexhibit1INTERLOCAL COOPERATION AGREEMENT DATED , 2004 BY AND AMONG MIAMI-DADE COUNTY, THE CITY OF MIAMI AND THE MIAMI SPORTS AND EXHIBITION AUTHORITY This Interlocal Cooperation Agreement made this day of , 2004 by and among Miami -Dade County, a political subdivision of the State of Florida (the "County"), the City of Miami, a municipal corporation organized under the laws of the State of Florida (the "City") and the Miami Sports and Exhibition Authority, an autonomous agency of the City ("MSEA") regarding the defeasance of the MSEA Bonds and the use and disposition of a portion of the Convention Development Tax as defined in this agreement and certain other provisions (the "Interlocal"). WITNESSETH: WHEREAS, the County, pursuant to Section 212.0305(4)(b), Florida Statutes (the "Act"), Section 29-60 of the Code of Metropolitan Dade County, Florida, and Ordinance No. 83-91 enacted by the Board of County Commissioners of Miami -Dade County (the "Board") on June 5, 1984, imposed a levy on the exercise within its boundaries of the taxable privilege of leasing or letting transient rental accommodations at the rate of three percent of the total consideration charged for such accommodations (the "Convention Development Tax" or "CDT"); and WHEREAS, Sections 212.0305(4)(b)2.b and d, Florida Statutes, provide that one-third of the CDT Receipts (defined below) of the County (net of administrative costs permitted to be deducted from such amount pursuant to Section 212,0305(5)b.5, Florida Statutes, and excluding any carryover from prior year collections) (the "One -Third CDT Share") shall be applied for acquisition, construction, extension, enlargement, remodeling, reparation, improvement, operation or maintenance of one or more convention centers, stadiums, exhibition halls, arenas, coliseums, auditoriums, golf courses, or related buildings and parking facilities in the most populous municipality in the County; and WHEREAS, MSEA issued bonds for the construction of the Miami Arena; and WHEREAS, pursuant to Resolution No. R-1366-90 adopted on December 18, 1990 and Resolution No. R-821-92 adopted on July 7, 1992 (the "1992 Resolution"), the Board approved the issuance by MSEA of $40,950,000 Special Obligation Refunding Bonds, Series 1992A, and $7,725,000 Special Obligation Refunding Bonds, Series 1992B (collectively, the "MSEA Bonds") payable as to principal and interest from the One -Third CDT Share for the purpose of paying the cost of acquiring and constructing the coliseum component of the convention/coliseum/exhibition center (the "Miami Arena"); and ORS WHEREAS, pursuant to the 1992 Resolution the Board approved the allocation of a portion of the One -Third CDT Share to MSEA in the initial amount of $669,500 (plus an annual three percent CPI escalation) to assist in defraying its operating expenses for administering the Miami Arena (the "MSEA Operating Allocation"); and WHEREAS, as an aid to the City during its fiscal crisis in the mid -nineties, the County pursuant to Resolution No. R-1439-96, adopted by the Board on December 17,1996, approved a City request allowing MSEA to provide a portion of the MSEA Operating Allocation and certain unrestricted capital revenues held by MSEA derived from the One -Third CDT Share and its operation of the Miami Arena to the City to defray the operating costs of the Miami Convention Center, the Coconut Grove Exhibition Center, the Orange Bowl Stadium, the Miami Stadium and City -owned golf courses; and WHEREAS, the City has overcome its fiscal crisis thereby removing the purpose for Resolution No. R-1439-96; and WHEREAS, under Section 212.0305(b)2.d, Florida Statutes, after completion of the Miami Arena, the County has the statutory responsibility to determine the use of the One -Third CDT Share; and WHEREAS, the parties have determined that it is in the public interest to sell the Miami Arena, which has been under utilized as a result of the construction of the new American Airlines Arena; and WHEREAS, MSEA held a public auction for the sale of the Miami Arena and has agreed to sell it pursuant to a Purchase and Sale Agreement dated August 10, 2004 (the "Purchase and Sale Agreement'); and WHEREAS, the parties hereto wish to enter into this Agreement to provide for the continued use by MSEA and the City of CDT Receipts (defined below) solely for the purposes permitted in this Interlocal upon the closing of the sale of the Miami Arena and the deposit of Escrowed Funds (as defined below) in order to defease the MSEA Bonds; and WHEREAS, the City and County contemplate construction of the Ballpark Project (defined below) and the issuance by the City of the Ballpark Bonds (defined below) (exclusive of all financing expenses such as interest and costs of issuance) towards a portion of the cost of the Ballpark Project; and WHEREAS, MSEA and the City intend to enter into an agreement to establish MSEA's role with respect to other facilities in the City that are eligible to receive CDT funding, such as the Orange Bowl Stadium. NOW, THEREFORE, the County, the City and MSEA agree as follows: 2 A, DEFINITIONS (1) "Ballpark" shall mean the major League baseball facility to be constructed at the Orange Bowl site for use by the Florida Marlins. (2) "Ballpark Bonds" shall mean the issuance of debt by the City to pay $60 million (exclusive of all financing expenses such as interest and costs of issuance) towards a portion of the cost of the Ballpark Project. "Ballpark Project" shall mean the Ballpark, the related parking facilities, and associated land and infrastructure to be developed by the Florida Marlins adjacent to the Orange Bowl Stadium. (4) "CDT Receipts" shall mean the revenues collected annually (excluding any carryover from prior year collections) by the County of the levy on the exercise within its boundaries of the taxable privilege of leasing or letting transient rental accommodations at the rate of three percent (3°A) of the total consideration charged therefore as currently authorized pursuant to Section 212.0305(4)(b), Florida Statutes (net of Tax Collector administrative costs for local administration pursuant to Section 212.0305(5)(b)5, Florida Statutes). (5) "GOB/OB Share" shall mean proceeds in the amount of $50 million to be paid by the County to the City from the issuance of general obligation bonds issued for the purpose of renovating the Orange Bowl Stadium. (6) "MSEA Accounts" shall mean the Interest Fund, the Principal Fund, the Reserve Fund, the General Fund, the Expense Fund, the Rebate Fund and the Capital Reserve and Operating Deficit Account, as defined in the 1992 Resolution. It is understood that the MSEA Accounts do not include any non- CDT Receipts. (3) B. PRIORITY LIEN It is recognized and the parties agree that any outstanding indebtedness and obligations of the County secured by a pledge of the CDT Receipts, all as specifically set forth in Exhibit "A", which Exhibit "A" is incorporated herein as part of this Interlocal by this reference, shall have a first claim on such CDT Receipts prior to any other payments required under this Interlocal. It is agreed by the Parties that after the obligations of Exhibit "A" have been satisfied, the payments required under this Interlocal Agreement shall have a priority lien on the CDT Receipts ahead of all other obligations secured by the CDT Receipts, including bonds in addition to those bonds listed in Exhibit "A" issued to complete the Performing Arts Center ("PAC"), which additional PAC completion bonds shall have a lien on the CDT Receipts subordinate to the payments required under this Interlocal Agreement. 3 C. THE MSEA BONDS No later than ninety (90) days after the closing on the sale of the Miami Arena, MSEA shall deposit monies in an escrow fund in amounts sufficient to (i) redeem those MSEA Bonds that are callable by paying the principal and interest due on the next call date and (ii) to pay interest until maturity and principal at maturity for those MSEA Bonds not callable prior to maturity (collectively, the "Escrowed Funds"). The date MSEA deposits the Escrowed Funds shall be deemed the "Defeasance Date". At the time of execution of this Interlocal, MSEA shall provide to the City and the County an accounting of all unallocated, uncommitted monies on deposit in the MSEA Accounts and the net proceeds from the sale of the Miami Arena (the "Available Funds"). Until the Defeasance Date, the County shall continue to make all payments required under the 1992 Resolution. To the extent the Escrowed Funds are less than the Available Funds, the Parties agree that the remaining funds (the "Residual Amount") shall be used by the City for the sole purposes of renovating the Orange Bowl (the "Orange Bowl Renovations") or in connection with the Ballpark Project. The use of the Residual Amount for purposes other than the Orange Bowl Renovations or in connection with the Ballpark Project shall require Board approval. In the event the closing of the sale of the Miami Arena occurs and the Escrowed Funds are not deposited within ninety (90) days after the closing of the sale of the Miami Arena: (a) the County shall remit to the Bond Trustee only that portion of the CDT Receipts that are necessary to pay the principal and interest on the MSEA Bonds; (b) the County shall no longer be obligated to remit the MSEA Operating Allocation and the Capital Replacement Allocation; and (c) MSEA shall remit to the County no later than 91 days after the closing on the sale of the Miami Arena an amount equal to the Available Funds, less the net proceeds from the sale of the Miami Arena. D. GENERAL OBLIGATION BOND Provided there is a reasonable expectation the Orange Bowl renovations will be ready for funding and completed within in three years from the issuance of bonds, the County agrees that the County shall use its reasonable efforts to include all or a portion of the GOB/OB Share in the first series of bonds issued with respect to the General Obligation Bond question that includes funding for the Orange Bowl Stadium. E. CITY ISSUANCE OF THE BALLPARK BONDS If the Ballpark Project moves forward, as evidenced by approval of definitive agreements for the Ballpark Project by the Marlins, the Board and the City Commission (and such other necessary parties), which definitive agreements, include but are not limited to a cost overrun guaranty, a lease, a development agreement and a management agreement, no earlier than the effective date of the definitive agreements but no later than September 1, 2005 (unless extended in writing by the Parties) the City shall (i) issue the Ballpark Bonds or (ii) 4 contribute $60 million (exclusive of all financing expenses such as interest and costs of issuance) towards a portion of the cost of the Ballpark Project (for example, the City may fund its $60 million contribution with proceeds from a bond issuance by MSEA secured by a pledge of the Current Share and other revenues of the City). If the City elects to issue the Ballpark Bonds rather than provide the contribution, the Ballpark Bonds shall be secured with a pledge of the Current Share (defined below) and other revenues of the City. The issuance of the Ballpark Bonds or the City's contribution of $60 million (exclusive of all financing expenses such as interest and costs of issuance) towards a portion of the cost of the Ballpark Project will satisfy the County's prior pledge to the Marlins that the County would finance the same $58 million in project costs. The City agrees that additional financing secured above the amount required for the Ballpark Bonds, shall be used to fund the cost of Orange Bowl Renovations. F. DISPOSITION OF THE CDT RECEIPTS Other than as previously authorized by the Board or as set forth in this Section F, the One - Third CDT share shall be disbursed in accordance with the Act, as determined by the County, for projects qualified pursuant to the Act and located solely within the most populous municipality in the County. The County's obligation to make the payments set forth in this Section F is conditioned upon MSEA's deposit of the Escrowed Funds in the manner set forth in Section C above. Following MSEA's deposit of the Escrowed Funds in the manner set forth in Section C above, the County shall pay the City, solely from the CDT Receipts, an amount equal to the annual amount currently paid to MSEA, which consists of the MSEA Operating Allocation, debt service on the MSEA Bonds and the Capital Replacement Allocation (the "Current Share") commencing on the first day of the month following the Defeasance Date of the MSEA Bonds and ending on September 30, 2020. The County shall pay the Current Share to the City in monthly installments from the CDT Receipts received by the County that month until the Current Share is paid in full. The City agrees that the Current Share shall first be pledged to (i) payment of the debt service on the Ballpark Bonds or (ii) to fund the City's contribution of $60 million (exclusive of all financing expenses such as interest and costs of issuance) towards a portion of the cost of the Ballpark Project. To the extent the Current Share exceeds the required debt service on the Ballpark Bonds, or the amounts necessary to secure its $60 million contribution, the City shall use such excess to fund Orange Bowl Renovations. In the event the City has not issued the Ballpark Bonds or contributed $60 million (exclusive of all financing expenses such as interest and costs of issuance) towards a portion of the cost of the Ballpark Project pursuant to Section E by September 1, 2005 (unless extended in writing by the Parties) because the definitive agreements were not approved by the Marlins, the Board and the City Commission, the County shall no longer be obligated to pay the City the Current Share, as set forth in this Section above, and the City shall have no obligation to issue the Ballpark Bonds. Instead, the County shall pay to the City solely from the CDT 5 Receipts an amount equal to $2 million a year for a term commencing upon the Defeasance Date and ending on September 30, 2020. The County shall pay the annual $2 million payment to the City in monthly installments from the CDT Receipts received by the County that month, until the $2 million is paid in full. Notwithstanding the foregoing, any payments made by the County to the City of the Current Share that are in excess of those payments due pursuant to this paragraph shall be credited against future payments due from the County to the City until credited in full. After satisfaction of the City's obligations set forth in Section E, the City may remit a portion of the CDT Receipts received from the County to MSEA to be used in accordance with the terms of this Interlocal. The City shall require MSEA to prepare an annual report addressed to the City and the County that details MSEA's expenditures of any funds remitted to it by the City. G. AUTOMATIC TERMINATION In the event the closing of the sale of the Miami Arena does not occur by December 30, 2004 (the "Automatic Termination Date"), then this Agreement shall become automatically null, and void and shall have no further force and effect. If the closing of the sale of the Miami Arena is extended beyond December 30, 2004, the Parties to this Interlocal may agree to extend the Automatic Termination Date to such later date as approved in writing by the Parties to this Interlocal. For purposes of this Section, the County Manager, the City Manager and MSEA's Chairperson may exercise their respective rights to extend the Automatic Termination Date without the Board, the City Commission and MSEA's prior approval, respectively. H. AUDIT RIGHTS The County shall have the right, without limitation, but not the obligation, to separately audit all accounts, books, records, and the supporting documentation related to the CDT Receipts remitted either directly or indirectly to the City and MSEA and the expenditure of any funds on the Orange Bowl Renovations. Such auditor may be engaged to investigate, inspect and review the operations and activities of the City and MSEA in connection with this Interlocal. The County shall be responsible for the cost of any separate audits performed at its request. The City and MSEA shall use its best efforts in assisting the auditor in its duties. Nothing in this Interlocal shall impair the County's existing rights to audit or to investigate past and future acts. Any rights that the County has under this section shall not be the basis for any liability to the County either from the City, MSEA or third parties for such investigation or for the failure to have conducted such investigation. I. ENTIRE AGREEMENT This Interlocal constitutes the sole and only agreement of the County, the City and MSEA with respect to the CDT Receipts and correctly sets forth the rights, duties and obligations of 6 each to the other as of its date. Any prior agreements, promises, resolutions, negotiations, or representations not expressly set forth in the Interlocal are of no force and effect. J. AMENDMENTS No amendments to this Interlocal shall be binding on the parties unless in writing and executed by the parties. Joe Arriola City Manager City of Miami George M. Burgess County Manager Miami -Dade County APPROVED AS TO FORM APPROVED AS TO FORM AND CORRECTNESS: AND LEGAL SUFFICIENCY: City Attorney ,, Assistant County Attorney' City Clerk Clerk of the Board Chairperson Miami Sports and Exhibition Authority 7