ITEM R3

OFFICE OF THE CITY MANAGER

(910) 341-7810 | FAX (910)341-5839
TDD (910)341-7873

2/21/2023

City Council
City Hall
Wilmington, North Carolina 28401

Dear Mayor and Councilmembers:

Attached for your consideration is a resolution authorizing the negotiation of an amendment to an

installment financing contract (“Contract Amendment”) in a principal amount not to exceed
$30,000,000, and providing for certain other related matters. The City intends to apply the proceeds of
the Contract Amendment to finance (a) street, sidewalk, accessibility, streetscape, and Riverwalk
improvements; (b) parks and recreation improvements, including improvements to Water Street Park
and Riverfront Park; (c) the construction and equipping of a new fire station in the Riverlights
community; and, (d) a portion of the construction and equipping of a sports complex (together as "the
Projects"). Additionally, the resolution authorizes the following:

1) The City Manager and the Finance Director, with advice from the City Attorney and Bond Counsel,
are directed to negotiate the Contract Amendment, and to extend the lien created by the deed of trust
securing the Contract Amendment to the site of the Riverlights Fire Station;

2) The Finance Director is directed to file an application with the Local Government Commission;

3) The City shall retain Bond Counsel, an Underwriter, and a Financial Advisor;

4) A public hearing will be conducted by the City Council on March 21, 2023, at 6:30 p.m.,
concerning the Contract Amendment, the financing of the Projects, and other transactions
contemplated; and,

5) The City Clerk is directed to cause a notice of Public Hearing, a form of which is attached, to be
published once in a qualified newspaper of general circulation within the City no fewer than 10 days
prior to the Public Hearing.

Passage of the attached Resolution is recommended.

Respectfully submitted,

Anthony N. Caudle,
City Manager
Resolution City Council
City of Wilmington
North Carolina

Introduced By: Anthony N. Caudle, City Manager Date: 2/21/2023

Resolution of the City Council of the City of Wilmington, North Carolina, Authorizing the
Negotiation of an Amendment to an Installment Financing Contract in an Amount Not to
Exceed $30,000,000 to Finance Streets and Sidewalks Projects, Parks and Recreation
Projects, the Construction of a New Fire Station, and the Construction of a Sports
Complex and Providing for Certain Other Related Matters Thereto

**See ATTACHMENTS for complete resolution

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 City Council
Resolution City of Wilmington
North Carolina
________________________________________________ 
  Introduced By: Meredith Everhart, Interim City Attorney Date: February 21, 2023

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WILMINGTON, NORTH

CAROLINA, AUTHORIZING THE NEGOTIATION OF AN AMENDMENT TO AN
INSTALLMENT FINANCING CONTRACT IN AN AMOUNT NOT TO EXCEED
$30,000,000 TO FINANCE STREETS AND SIDEWALKS PROJECTS, PARKS AND
RECREATION PROJECTS, THE CONSTRUCTION OF A NEW FIRE STATION, AND
THE CONSTRUCTION OF A SPORTS COMPLEX AND PROVIDING FOR CERTAIN
OTHER RELATED MATTERS THERETO

WHEREAS, the City of Wilmington, North Carolina (the “City”) is a validly existing
municipal corporation of the State of North Carolina, existing as such under and by virtue of the
Constitution, statutes and laws of the State of North Carolina (the “State”);

WHEREAS, the City has the power, pursuant to the General Statutes of North Carolina
to (1) enter into installment contracts in order to purchase, or finance or refinance the purchase
of, real or personal property and to finance or refinance the construction or repair of fixtures or
improvements on real property and (2) create a security interest in some or all of the property
financed or refinanced to secure repayment of the purchase price;

WHEREAS, the City has previously entered into (1) an Installment Financing Contract
dated as of June 15, 2012 (the “2012 Contract”), as amended by Amendment Number One to the
2012 Contract dated as of June 1, 2015 (the “First Amendment”), Amendment Number Two to
the 2012 Contract dated as of May 1, 2020 (the “Second Amendment”), and Amendment Number
Three to the 2012 Contract dated as of May 1, 2021 (the “Third Amendment”), each with
Wilmington Future, Inc., a North Carolina nonprofit corporation (the “Corporation”), to finance
and refinance the projects described therein; and (2) to secure its obligations under the 2012
Contract, as amended, a Deed of Trust and Security Agreement dated as of June 15, 2012 (the
“2012 Deed of Trust”) granting a security interest in the sites of the Operations Center, Fire
Station 8, Fire Station 9, Masonboro Fire Station, Seagate Fire Station and the Command Center
(all as defined in the 2012 Contract), as extended by a Notice of Extension of Deed of Trust to
Additional Property dated as of June 1, 2015 (the “First Notice”), extending the lien of the 2012
Deed of Trust to the sites of Cinema Drive and Shipyard Fire Stations, and a Second Notice of
Extension of Deed of Trust to Additional Property dated as of May 1, 2020 (the “Second

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Notice”), extending the lien of the 2012 Deed of Trust to the site of the Public Safety Training
Facility and Firing Range;

WHEREAS, the City Council hereby determines that it is in the best interest of the City
to enter into Amendment Number Four to the 2012 Contract (the “Fourth Amendment” and
together with the 2012 Contract, the First Amendment, the Second Amendment, and the Third
Amendment, the “Contract”) in order to pay the capital costs of (a) street, sidewalk,
accessibility, streetscape, and Riverwalk improvements, (b) parks and recreation improvements,
including improvements to Water Street Park and Riverfront Park, (c) the construction and
equipping of a new fire station in the Riverlights community (the “Riverlights Fire Station”), and
(d) a portion of the construction and equipping of a sports complex (collectively, the “2023
Projects”);

WHEREAS, the City intends to extend the lien of the 2012 Deed of Trust, as previously
extended, to the site of the Riverlights Fire Station and the City Council hereby determines that it
is in the best interest of the City to enter into a Third Notice of Extension of Deed of Trust to
Additional Property (the “Third Notice” and together with the 2012 Deed of Trust, the First
Notice, and the Second Notice, the “Deed of Trust”);

WHEREAS, the City Council reaffirms the findings in its resolutions previously adopted
with respect to the 2012 Contract and its related amendments;

WHEREAS, the City hereby determines that acquiring the 2023 Projects is essential to
the City’s proper, efficient and economic operation and to the general health and welfare of its
inhabitants; that the 2023 Projects will provide an essential use and will permit the City to carry
out public functions that it is authorized by law to perform; and that entering into the Fourth
Amendment and Third Notice is necessary and expedient for the City by virtue of the findings
presented herein;

WHEREAS, the City hereby determines that the Fourth Amendment would allow the
City to finance the acquisition of the 2023 Projects and take title thereto at a favorable interest
rate currently available in the financial marketplace and on terms advantageous to the City;

WHEREAS, the City hereby determines that the estimated cost of acquiring the 2023
Projects is an amount not to exceed $30,000,000 and that such cost exceeds the amount that can
be prudently raised from currently available appropriations, unappropriated fund balances and
non-voted bonds that could be issued by the City in the current fiscal year pursuant to Article V,
Section 4 of the Constitution of the State;

WHEREAS, although the cost of the acquisition of the 2023 Projects pursuant to the
Fourth Amendment is expected to exceed the cost thereof pursuant to a bond financing for the
same undertaking, the City hereby determines that the cost of acquiring the 2023 Projects
pursuant to the Fourth Amendment and the obligations of the City thereunder are preferable to a
general obligation bond financing or revenue bond financing for several reasons, including but
not limited to the following: (1) the cost of a special election necessary to approve a general

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obligation bond financing, as required by the laws of the State, would result in the expenditure of
significant funds; (2) the time required for a general obligation bond election would cause an
unnecessary delay which would thereby decrease the financial benefits of acquiring,
constructing, improving and equipping the 2023 Projects; and (3) insufficient revenues are
produced by the 2023 Projects so as to permit a revenue bond financing;

WHEREAS, the City has determined and hereby determines that the estimated cost of
acquiring the 2023 Projects pursuant to the Fourth Amendment reasonably compares with an
estimate of similar costs under a bond financing for the same undertaking as a result of the
findings delineated in the above preambles;

WHEREAS, the City does not anticipate a future property tax increase to pay installment
payments falling due under the Fourth Amendment;

WHEREAS, the sums to fall due under the Fourth Amendment will be adequate but not
excessive for its proposed purpose;

WHEREAS, Parker Poe Adams & Bernstein LLP (“Bond Counsel”), will render an
opinion to the effect that entering into the Fourth Amendment and the transactions contemplated
thereby are authorized by law;

WHEREAS, no deficiency judgment may be rendered against the City in any action for
its breach of the Fourth Amendment, and the taxing power of the City is not and may not be
pledged in any way directly or indirectly or contingently to secure any moneys due under the
Fourth Amendment;

WHEREAS, the City is not in default under any of its debt service obligations;

WHEREAS, the City’s budget process and Annual Budget Ordinance are in compliance
with the Local Government Budget and Fiscal Control Act, and external auditors have
determined that the City has conformed with generally accepted accounting principles as applied
to governmental units in preparing its Annual Budget ordinance;

WHEREAS, past audit reports of the City indicate that its debt management and contract
obligation payment policies have been carried out in strict compliance with the law, and the City
has not been censured by the North Carolina Local Government Commission (the “LGC”),
external auditors or any other regulatory agencies in connection with such debt management and
contract obligation payment policies;

WHEREAS, a public hearing on the Fourth Amendment after publication of a notice with
respect to such public hearing must be held, and approval of the LGC with respect to entering
into the Fourth Amendment must be received; and

WHEREAS, the City hereby determines that all findings, conclusions and determinations
of the City in this Resolution are subject to modification or affirmation after all interested parties
have been afforded the opportunity to present their comments at a public hearing regarding the

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execution and delivery of the Fourth Amendment and Third Notice and the projects to be
financed thereby.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY

OF WILMINGTON, NORTH CAROLINA, AS FOLLOWS:

Section 1. Authorization to Negotiate the Fourth Amendment and Third Notice.

The City Manager and the Finance Director, including anyone serving as such in an interim
capacity, or their respective designees, individually and collectively (the “Authorized Officers”),
with advice from the City Attorney, including anyone serving as such in an interim capacity, and
Bond Counsel, are hereby authorized and directed to negotiate on behalf of the City for the
financing of the 2023 Projects for a principal amount not to exceed $30,000,000 under the Fourth
Amendment entered into in accordance with the provisions of the Section 160A-20 of the
General Statutes of North Carolina, and to provide in connection with the Fourth Amendment, as
security for the City’s obligations thereunder, the Third Notice extending the lien created by the
2012 Deed of Trust, as previously extended, to the site of the Riverlights Fire Station, including
the improvements thereon.

Section 2. Application to LGC. The Finance Director or her designee is hereby

directed to file with the LGC an application for its approval of the Fourth Amendment and all
relevant transactions contemplated thereby on a form prescribed by the LGC and to state in such
application such facts and to attach thereto such exhibits regarding the City and its financial
condition as may be required by the LGC.

Section 3. Financing Team. The Authorized Officers, with advice from the City
Attorney, are hereby authorized and directed to retain the assistance of Parker Poe Adams &
Bernstein LLP, Raleigh, North Carolina, as bond counsel, Raymond James & Associates, Inc., as
underwriter, and Waters & Company, LLC, as financial advisor.

Section 4. Public Hearing. A public hearing (the “Public Hearing”) shall be

conducted by the City Council on March 21, 2023 at 6:30 p.m. in the Council Chambers, City
Hall, 102 N. 3rd St., Wilmington, North Carolina 28401, concerning the Fourth Amendment, the
Third Notice, and the proposed projects to be financed thereby, and any other transactions
contemplated therein and associated therewith.

Section 5. Actions by the City. All actions of the Authorized Officers on behalf of
the City with respect to the Fourth Amendment, whether previously or hereinafter taken, are
hereby approved, ratified and authorized.

Section 6. Notice of Public Hearing. The City Clerk is hereby directed to cause a
notice of the Public Hearing to be published once in a qualified newspaper of general circulation
within the City no fewer than 10 days prior to the Public Hearing.

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 Section 7. Repealer. All motions, orders, resolutions and parts thereof in conflict
herewith are hereby repealed.

Section 8. Effective Date. This Resolution is effective on the date of its adoption.

The resolution was adopted by the following vote:

YEAS

NAYS

READ, APPROVED AND ADOPTED this 21st day of February, 2023.

_______________________________

Bill Saffo, Mayor

ADOPTED AT A REGULAR MEETING

ON FEBRUARY 21, 2023

ATTEST:

_______________________________
Penelope Spicer-Sidbury, City Clerk

APPROVED AS TO FORM:

_______________________________
Meredith Everhart, Interim City Attorney

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 EXHIBIT A

NOTICE OF PUBLIC HEARING

The City of Wilmington, North Carolina (the “City”) previously entered into (1) an Installment
Financing Contract dated as of June 15, 2012 (the “2012 Contract”), as amended by Amendment Number
One to the 2012 Contract dated as of June 1, 2015 (the “First Amendment”), Amendment Number Two to
the 2012 Contract dated as of May 1, 2020 (the “Second Amendment”), and Amendment Number Three to
the 2012 Contract dated as of May 1, 2021 (the “Third Amendment”), each with Wilmington Future, Inc.,
a North Carolina nonprofit corporation, to finance and refinance the projects described therein, (2) to secure
its obligations under the 2012 Contract, as amended, a Deed of Trust and Security Agreement dated as of
June 15, 2012 (the “2012 Deed of Trust”) granting a security interest in the sites of the City’s Operations
Center, Fire Station 8, Fire Station 9, Masonboro Fire Station, Seagate Fire Station and the Command
Center (all as defined in the 2012 Contract), as extended by a Notice of Extension dated as of June 1, 2015
(the “First Notice”) extending the lien of the 2012 Deed of Trust to the sites of Cinema Drive and Shipyard
Fire Stations and a Second Notice of Extension to the 2012 Deed of Trust dated as of May 1, 2020 (the
“Second Notice”) extending the lien of the 2012 Deed of Trust to the site of the Public Safety Training
Facility and Firing Range.

At its February 21, 2023 meeting, the City Council (the “City Council”) of the City adopted a
resolution which authorized the City to proceed to pay the capital costs of (a) street, sidewalk, accessibility,
streetscape and Riverwalk improvements, (b) parks and recreation improvements, including improvements
to Water Street Park and Riverfront Park, (c) the construction and equipping of a new fire station in the
Riverlights community (the “Riverlights Fire Station”), and (d) a portion of the construction and equipping
of a sports complex (the “Sports Complex” together with the projects listed in (a) through (c), above, the
“2023 Projects”) under Amendment Number Four to the 2012 Contract to be dated on or about May 1,
2023 (the “Fourth Amendment” and together with the 2012 Contract, the First Amendment, the Second
Amendment, and the Third Amendment, the “Contract”), in a principal amount not to exceed $30,000,000,
under which the City will make certain installment payments, in order to make the 2023 Projects available
to the City.

As security for its obligations under the Fourth Amendment, the City Council has authorized the
City to proceed to provide, in connection with the Fourth Amendment, as grantor, a Third Notice of
Extension to the 2012 Deed of Trust (the “Third Notice” and together with the 2012 Deed of Trust, the First
Notice, and the Second Notice, the “Deed of Trust”) to extend the lien and security interest created by the
2012 Deed of Trust to the land on which the Riverlights Fire Station will be constructed and any
improvements thereon.

The Sports Complex is located at 205 Sutton Steam Plant Rd., Wilmington, NC 28401. The
principal amount of the Contract to be used to finance improvements to the Sports Complex will not
exceed $15,000,000, which portion of the Contract will constitute “qualified 501(c)(3) bonds” within
the meaning of Section 145(a) of the Internal Revenue Code of 1986. The City will own the Soccer
Complex, and the Soccer Complex will be initially operated by Cape Fear Youth Soccer Association,
Inc.

The Riverlights Fire Station will be located at 4455 River Road, Wilmington, North Carolina
28412. On payment by the City of all installment payments due under the Contract, including any future
amendments to finance or refinance projects, any lien created by the Deed of Trust will terminate and the
City’s title to the Operations Center, Fire Station 8, Fire Station 9, Masonboro Fire Station, Seagate Fire
Station, the Command Center, the Cinema Drive Fire Station, the Shipyard Fire Station, Public Safety

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Training Facility and Firing Range, and the Riverlights Fire Station (collectively, the “Mortgaged
Property”) will be unencumbered. The Contract and the Deed of Trust permit the City to enter into
amendments to finance additional projects and refinance projects using the Mortgaged Property as collateral
and the City may or may not grant additional collateral in connection with such amendments.

NOTICE IS HEREBY GIVEN, pursuant to Sections 160A-20 of the General Statutes of North
Carolina, that on March 21, 2023 at 6:30 p.m. in the Council Chambers, City Hall, 102 N. 3rd St.,
Wilmington, North Carolina 28401, a public hearing will be conducted concerning the Fourth Amendment,
the Third Notice, the 2023 Projects and any other transactions contemplated therein and associated
therewith. All interested parties are invited to present comments related thereto at the public hearing.

/s/ PENELOPE SPICER-SIDBURY

City Clerk
City of Wilmington, North Carolina
Published: March __, 2023

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