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RFD- 3883 Bylaws   Item #   10. c.    
Regular Council Meeting Agenda
Meeting Date: 03/09/2020  
Title:    C-1111-20 - Land Borrowing Bylaw Amendment - Second and Third Reading - Boje
Department: Corporate Services  
Strategic Vision Element: This topic relates to all three of the City’s strategic vision elements contained in Council’s Strategic Plan Related Goal: n/a

Information
Request for Decision Summary
The purpose of this report is to seek Council's support for second and third reading of Bylaw C-1111-20, which will amend a Land Borrowing Bylaw to update the repayment terms of the debenture.

Proposed Motion
That second reading be given to Bylaw C-1111-20 - Land Borrowing Bylaw Amendment.
 
That third reading be given to Bylaw C-1111-20 - Land Borrowing Bylaw Amendment. 
Background/Analysis
A $8,900,000 debenture was taken out with Pacific Western Bank of Canada (now VersaBank) under an agreement signed and dated March 24, 2010. The funds were taken out to provide long term debenture financing to acquire lands for the Gateway Centre Development Project in the City (also known as the Westwind Lands). Section 5, in the original bylaw, allowed the City to make interest only semi-annual payments for the first 10 years of the agreement, and section 6 required that we shift to semi-annual equal payments of combined principal and interest for the remaining term of the agreement. We have paid down the principal through land sales reducing the outstanding balance of this debenture to $451,909.
 
The City has elected to extend the agreement with the developer beyond March 2020. Pacific Western Bank of Canada (now VersaBank) has agreed to extend the interest only portion of the loan to allow the City to collect the interest from the developer and avoid paying the principal payments until there are further land sales. This proposed bylaw amendment allows for the extension of the interest only payments.
Options/Alternatives
Council could choose not to approve this amending bylaw and commence paying semi-annual installments of combined principal and interest.
Consultation/Engagement
The Corporate Leadership Team was consulted on the direction they would like to take with respect to repayment of the outstanding debenture of $451,909. They were more comfortable with the interest only payments option, as the balance of the principal will be paid from land sales when the developer acquires the remaining Westwind lands.
Implementation/Communication
This bylaw amendment does not require re-advertisement as the amount to be borrowed was already approved by Council. The amendment is to the repayment terms only. We combined the second and third reading of this bylaw to allow sufficient time to get the bylaw approved and circulated back to the financial institution prior to the March 24, 2020 ten year debenture date.
Impacts
If this bylaw amendment is not approved the City will be required to commence paying semi-annual installments of combined principal and interest on the outstanding debenture $451,909 commencing in March, 2020.

Fiscal Impact
Financial Implications:
If this bylaw amendment is not approved the City will be required to commence paying semi-annual installments of combined principal and interest on the outstanding debenture $451,909 commencing in March, 2020. This
represents an unplanned additional expense that would contribute negatively to the City's financial position.
Attachments
Proposed C-1111-20 Land Borrowing Bylaw Amendment
Land Borrowing Bylaw - Redline Copy

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