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HomeMy WebLinkAbout029-22 (WoodstockEDAFinancing(ReShenandoahUniversity) RESOLUTION OF THE BOARD OF SUPERVISORS OF FREDERICK COUNTY CONCURRING WITH A FINANCING TO BE UNDERTAKEN BY THE ECONOMIC DEVELOPMENT AUTHORITY OF THE TOWN OF WOODSTOCK,VIRGINIA, TO BENEFIT SHENANDOAH UNIVERSITY WHEREAS, the Economic Development Authority of the Town of Woodstock, Virginia (the "Authority"), has received an application from Shenandoah University, a not-for-profit Virginia non-stock corporation (the "University"), requesting the Authority to issue its Educational Facilities Revenue Bond in an aggregate principal amount not to exceed $9,000,000 (the "Bond") to finance (1) the Project, as described on Exhibit A, and (2) issuance expenses incurred in connection with the issuance of the Bond; WHEREAS, Section 15.2-4905 of the Code of Virginia of 1950, as amended (the "Virginia Code"), states that an industrial development authority may not finance facilities in another jurisdiction that has created its own industrial development authority "unless the governing body of such locality in which the facilities are located or are proposed to be located, concurs with the inducement resolution adopted by the Authority, and shows such concurrence in a duly adopted resolution;" WHEREAS, Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code") requires that the governmental unit having jurisdiction over the area in which any facility financed with the proceeds of the Bond is located approve the issuance of such Bond; WHEREAS, Section 147(fj of the Internal Revenue Code requires that any such approval by the applicable governmental unit be given after a public hearing following reasonable public notice, which hearing may be held by the public authority issuing the Bond; WHEREAS, .on November 1 2022, in accordance with the. requirements of Section 147(f) of the�Intenial Revenue Code and Section 15.2-4906 of the Virginia Code, the Authority held a public hearing and adopted a resolution (the "Resolution"), a copy of which has been filed with the records of the Clerk of the Board of Supervisors of the County; and WHEREAS, the University has requested the Board of Supervisors of the County to express its concurrence with the Resolution so that a portion of the net proceeds of the Bond may be loaned to the University to finance such portions of the Project to be located in the County. BE IT RESOLVED BY THE BOARD OF SUPERVISORS OF FREDERICK COUNTY,VIRGINIA: 1. The Board of Supervisors hereby approves the issuance of the Bond by the Authority for the benefit of the University, as required by Section 147(0 of the Internal Revenue Code and Section 15.2-4906 of the Virginia Code, and concurs with the Resolution adopted by the Authority for the benefit of the University to the extent required by Section 15.2-4905 of the Virginia Code to permit the Authority to loan the proceeds of the Bond to the University to finance the portion of the Project to be located in the County. Res. No. 029-22 2. The approval of the issuance of the Bond does not constitute an endorsement of the Bond or the creditworthiness of the University. As required by Section 15.2-4909 of the Virginia. Code, the Bond shall provide that the County will have no obligation to pay the Bond or the interest thereon or other costs incident thereto. I All acts and doings of the officers of the County and members of the Board of Supervisors that are in conformity with the purposes and intent of this resolution shall be, and the same hereby are, in all respects approved and confirmed. 4. This Resolution shall take effect immediately. Passed this 9th day of November 2022 by the following recorded vote: Charles S. DeHaven, Jr., Chainnan Aye Shawn L. Graber Aye J. Douglas McCarthy Aye Robert W. Wells Aye Josh Ludwig Aye Judith McCann-Slaughter Aye Blaine P. Dunn Aye A COPY A-TTEST Michael L, Bollhoefe Frederick County ministrator Res. No. 029-22 2 Exhibit A THE PROJECT The proceeds of the Bonds will be loaned to the University to finance and refinance the following facilities to be owned and operated by the University(herein, the "Capital Projects"): (a) finance costs related to the acquisition of real property and improvements located within the boundaries of the City of Winchester, Virginia, at 711 Millwood Avenue, Winchester, Virginia 22601 (known as the"South Campus Commons"); (b) refinance a taxable line of credit, the proceeds of which were used to provide interim financing for the renovation and equipping of residential facilities located within the boundaries of Frederick County, Virginia, at 1017 Millwood Pike, Winchester, Virginia 22601 (known as the"East Campus Commons"); (c) finance costs related to the design, acquisition, construction, renovation, rehabilitation and equipping of various University facilities (including classroom, office, laboratory, study, lounge, residential, dining, conference and event spaces) located or to be located on the Main Campus (as defined below) within the boundaries of the City and/or the County; and (d) finance, if and as needed, capitalized interest on the Bonds, a debt service reserve fund for the Bonds, costs of issuance related to the Bonds, and working capital expenditures related to the Capital Projects. The University's main campus (the "Main Campus") is located partly within the boundaries of the City of Winchester, Virginia, and partly within the boundaries of the County of Frederick, Virginia, generally (although not exclusively) in the area south of Winchester Recreati-on Park and the Winchester Country Club, north of-E. Jubal Early Drive, Millwood Avenue and Millwood Pike, east of South Pleasant Valley Road and west of Tulane and Shockey Drives. The Main Campus also includes the South Campus Commons, described above, which are located just south of Millwood Avenue. Res. No, 029-22 3 r COUNTY of FREDERICK ` Office of the County Administrator ti�gGl\'f x�a Tel: 540.665.6382 Fax: 540.667.0370 MEMORANDUM To: Board of Supervisors From: Jay E. Tibbs, Deputy County Administrator Date: November 3, 2022 Re: Consent to the Issuance of Bonds by the Town of Woodstock Economic Development Authority for the Benefit of Shenandoah University Attached is a proposed resolution for the Board to consent to the issuance of bonds by the Town of Woodstock Economic Development Authority for the benefit of Shenandoah University. One or more of the projects that would be subject to this bond financing is located in Frederick County. The Woodstock EDA is facilitating this transaction for the University because of limitations on "bank qualified" bond financings, which are the lowest cost option for borrowers using EDA financings. For the current calendar year, however, neither the Frederick County EDA nor the Winchester EDA is in a position to issue further "bank-qualified" bond financings. Federal and state law permit issuance of a bond financing by an EDA that does not serve the jurisdiction in which the borrower's facilities are located, with the consent of the governing body of the jurisdiction where the facilities are located. Accordingly, the attached resolution would reflect the Frederick County Board of Supervisors' consent to the Woodstock EDA engaging in this transaction. This financing in no way represents an obligation of the full faith and credit or otherwise of Frederick County or the Frederick County EDA. 107 North Kent Street 9 Winchester, Virginia 22601 HUNTON&WILLIAMS LLP II �,\ RIVERFRONT PLAZA,EAST TOWER i P t� 11 R k ,�' 1,, 951 EAST BYRD STREET ANDREWS KURTH RICHMOND,VIRGINIA 23219-4074 TEL 804•788•8200 FAX 804•788•8218 CHRISTOPHER G.KULP DIRECT DIAL:804-788-8742 EMAIL: ckulp@hunton.com October 24, 2022 FILE NO:054410.0000011 Via Email & U.S. Mail Mr. Jay E. Tibbs Deputy County Administrator Frederick County 107 North Kent Street Winchester, Virginia 22601 Dear Jay: In our firm's capacity as bond counsel to Shenandoah University, I wanted to follow up on our telephone discussion last week and formally request that the County Board of Supervisors place on its agenda for its November 9th meeting a resolution concurring in the issuance of bonds by the Town of Woodstock Economic Development Authority for the benefit of Shenandoah University. Similar to recent financings undertaken by the University, the University has decided to undertake a $9 million new money financing through the issuance of bank-qualified bonds in this calendar year. The University wanted to pursue the lowest cost financing option and was able to secure bank- qualified eligible financing through the Town of Woodstock EDA for this calendar year, which would not have been available from either the Frederick County EDA or the Winchester EDA because of tax-exempt financings that both the County and the City have already undertaken this calendar year. I have attached the form of TEFRA public hearing notice that was scheduled to appear in the Northern Virginian Daily newspaper on October 18 and October 25 for purposes of a public hearing before the Town of Woodstock EDA on November 1, 2022, at 6:00 pm. I have also attached a draft inducement resolution that will be considered by the Town of Woodstock EDA following the public hearing. As you are aware, state law requires that the governing body of the jurisdiction(s) in which a project is to be physically located concur in the issuance of bonds by an economic/industrial development authority from outside the jurisdiction. Hence, the University is seeking concurrence from both the County Board of Supervisors as well as from the Common Council of the City of Winchester since portions of the project may be located in the County and portions may be located in the City. ATLANTA AUSTIN BANGKOK BEIJING BOSTON BRUSSELS CHARLOTTE DALLAS HOUSTON LONDON LOS ANGELES MIAMI NEW YORK NORFOLK RICHMOND SAN FRANCISCO THE WOODLANDS TOKYO TYSONS WASHINGTON www,h u nton.com ANDREWS KURTH Mr. Jay E. Tibbs October 24, 2022 Page 2 I am attaching a draft resolution that we have prepared for the County Board of Supervisors. I would appreciate your reviewing this draft and conveying any comments or concerns that you or others at the County may have. My colleague Martha Warthen and I will try to address them as quickly as we can. The Town of Woodstock EDA will not be able to issue bonds for the University until the County Board of Supervisors has adopted its concurring resolution. On behalf of the University, thank you for your assistance with this request. Very truly yours, Christopher G. Kulp Enclosures cc: Philip Evans, Esq.