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From time to time and as funds may temporarily be needed by the city for the payment of all or a part of the estimated cost and expenses incident to the public improvement, the city council shall adopt an ordinance to be designated "Interim Note Ordinance, ________ Project" which ordinance shall authorize the temporary borrowing of funds under such conditions, as may be provided for in the basic agreement above referred to in Section 2-32-900 hereof and which said interim note ordinance shall describe the particular public improvement for which funds are temporarily needed, shall designate the name by which such project shall be identified, its location and a general description of the public improvement, shall indicate the total estimated cost of such project, which estimated cost may include the amount of the estimated interest which will accrue on the amount to be borrowed during the estimated period of time to complete the project, shall make an appropriation of sufficient funds of the city to pay such estimated costs, shall indicate the maximum amount of such temporary borrowing for such designated project, and shall indicate the maximum rate of interest to be paid for such temporary borrowing, such interest to be payable at the time and the manner as may be provided in the basic agreement. Provision may be made for an adjustable rate of interest but such rate or rates shall not exceed the rate of ten percent per annum. Said interim note ordinance shall further state and describe the use or uses to be made of such public improvement and shall make a determination on behalf of the city that the making of such public improvement serves a public purpose or purposes for which the city may subsequently issue or authorize and issue its general obligation full faith and credit bonds, as authorized by the provisions of Sections 2-32-680 through 2-32-750 of the Municipal Code hereinabove referred to. Said interim note ordinance shall also authorize and direct the mayor of the city and the city comptroller to execute on behalf of the city such interim note as may be provided for in the basic agreement, such interim note to be in substantially the following form:
(Form of Interim Note)
State of Illinois
County of Cook
City of Chicago
General Obligation Interim Note
Project
Number________ $________
The City of Chicago, Illinois (herein called "City"), a home rule unit and a body politic and corporate of the State of Illinois, for value received hereby promises to pay to the order of ________, as Agent under an Interim Note Financing Agreement dated ________ (which as the same may from time to time be amended is herein called the "Interim Note Financing Agreement"), on the maturity date of this Interim Note, the principal sum hereof together with interest hereon at the rate or rates to be computed as hereinafter provided for, which interest shall be payable on the first day of ________ following the date of this Note and semi-annually thereafter on each ________ 1 and ________ 1 until this Note is paid. Payment of such interest shall be evidenced by notation on the back hereof to indicate the date and the amount of interest so paid and signed by an authorized representative of the bank acting as agent for the bank or banks who are parties to the Interim Note Financing Agreement hereinabove referred to.
This Interim Note shall bear interest from the date of issue until paid at the rate of ________ percent per annum and which interest rate shall be adjusted from time to time and which rate shall be the lesser of ten percent per annum or a rate of interest equal to 60 percent of the rate announced from time to time by the Agent for 90-day unsecured loans made at its banking house in Chicago, Illinois, to commercial customers of the highest credit rating, such rate being known as the "Agent's Prime Rate". Within 3 business days after any change in its Prime Rate the Agent shall notify the City of such change.
This Interim Note shall be in the principal amount and shall be dated and become due on the dates as follows:
Principal Sum | Date of Issue | Date of Maturity |
Both principal of and interest on this Interim Note will be paid in lawful money of the United States of America at, or at such other financial institution as may be designated by the City Comptroller.
This Interim Note evidences indebtedness incurred under the terms of the Interim Note Financing Agreement, hereinabove referred to, to which reference is made for a statement of the terms and conditions under which this Interim Note may be paid in whole or in part at any time and without premium or penalty and without notice prior to its maturity date.
This Interim Note shall constitute a direct and general obligation of the City and a debt of the City, and the full faith and credit of the City are hereby irrevocably pledged for the punctual payment of the principal of and interest on this Interim Note according to its terms.
No official, officer, agent or employee of the City shall be liable personally on this Interim Note by reason of the issuance hereof.
It is hereby certified, recited and declared that all conditions, acts and things required by the Constitution and statutes of the State of Illinois, and including the duly enacted Ordinances of the City Council of the City of Chicago, including particularly the provisions of Sections 2-32-900 through 2-32-940 of the Municipal Code of the City of Chicago, as amended, to exist, to have happened and to have been performed precedent to and in the issuance of this Interim Note, do exist, have happened and have been performed in due time, form and manner as required by law, and that the issuance of this Interim Note does not violate any constitutional or statutory limitation or any limitation imposed by any existing Ordinance heretofore adopted by the said City Council of the City of Chicago, Illinois.
In Witness Whereof, the City of Chicago, Illinois, by its City Council, has caused this Interim Note to be signed by its mayor and by the Comptroller of said City, to be attested by the City Clerk of said City and the corporate seal of said City to be affixed hereto, all as of the date above specified.
City of Chicago, Illinois
By ________________
Mayor
Comptroller,
City of Chicago
Attest:
________________
City Clerk
(City Seal)
(Back of Interim Note)
Record of Payments Made of Principal or
Interest Accruing on this Interim Note
Date of Payment | Amount of Principal Paid | Amount of Interest Paid | Signature of Representative of Agent Bank |
____ | ____ | ____ | ____ |
____ | ____ | ____ | ____ |
____ | ____ | ____ | ____ |
and which said interim note shall be attested by the city clerk and the seal of the city shall be affixed thereto.
Prior to the adoption of any such interim note ordinance, a public hearing shall be held thereon by the finance committee of the city council pursuant to a notice given to such public hearing, such notice to refer generally to the subject matter of the ordinance and to be published at least once in a newspaper published in and having a general circulation within the City of Chicago, the date of such publication to be not less than ten days prior to the date of the public hearing.
Upon the adoption of any interim note ordinance by the city council and its approval by the mayor, the same shall be published by the city clerk, in pamphlet form, and shall be in full force and effect upon its publication.
(Prior code § 7-82)
That the interim note, or notes, be of the form and content as provided in the basic agreement, be dated as of the date of their execution and delivery, shall be expressed to mature on a definite payment date, which date shall be the same for all interim notes issued for a particular project and not to exceed five years from the date that the first interim note with respect to a project has been issued, and interest thereon at the agreed rate of interest shall be payable at the time or times as may be provided for in the basic agreement. The interim notes shall be payable by the city and without notice to the holder at any time before maturity and at any financial institution which shall be designated by the city comptroller, including the place where delivery will be made to a purchaser of the general obligation full faith and credit bonds to be issued pursuant to the provisions of Sections 2-32-680 through 2-32-750 of the Municipal Code, above referred to, or as such bonds may be issued in such manner as may then be provided by law.
The interim note, or notes, to be issued shall be made payable in the manner as provided in the basic agreement and shall contain such terms and conditions as shall be provided in such interim note ordinance authorizing the temporary borrowing, and such interim note, or notes, shall be an obligation of the city for which the full faith and credit of the city shall be pledged for the payment thereof. The city and the holder, or holders, of its interim note, or notes, may mutually agree that the time of payment of any interim note, or notes, may be extended for a period of not to exceed two years beyond its stated maturity date, and evidence of such extension be noted on the face of such interim note, or notes, so extended by the signatures of the mayor, of the city comptroller and to be attested by the city clerk and also to be signed by an authorized representative of the other parties to the basic agreement. Such ordinance shall further provide that the payment of principal and interest on such interim note, or notes, shall be made simultaneously with the delivery to the purchaser of the general obligation full faith and credit bonds previously authorized or to be authorized and issued by the city. If, for any reason, sufficient funds are not available from the proceeds of bonds to be issued, the city will take such action as may be necessary, including the levy of taxes for such purpose, to provide sufficient funds to pay in full such interim note, or notes, and interest thereon to the date of its payment; that the execution of any such interim notes as herein provided shall not cause any officer signing the same on behalf of the city to be personally liable by reason of such signing and the issuance thereof.
(Prior code § 7-83)
(Prior code § 7-84)
ARTICLE XI. FINANCING OF COST OF RESIDENTIAL OWNERSHIP AND DEVELOPMENT (2-32-950 et seq.)
(a) "Bonds" means the revenue bonds authorized under this ordinance and includes notes and any and all other limited obligations payable as provided hereunder.
(b) "Municipality" means the City of Chicago, Cook County, Illinois.
(c) "Person" means any individual, partnership, copartnership, firm, company, corporation, lending institution, association, joint stock company, trust, estate, political subdivision, state agency or any other legal entity, or its legal representative, agent or assigns, but shall, when used with reference to a mortgagor or owner of a home, mean a natural person or a trust for the benefit of such natural person.
(d) "Residential development" means the acquisition, construction, reconstruction, rehabilitation, repair, alteration, improvement or extension of any land, interest in land, building, structure, facility, system, fixture, improvement, addition, appurtenance, machinery or equipment or any combination thereof, all real and personal property deemed necessary in connection therewith and all real and personal property or improvements functionally related and subordinate thereto, substantially for use by or intended to be occupied substantially by persons of low or moderate income for the purpose of decent, safe and sanitary housing, and in connection therewith nonhousing facilities which are an integral part of or functionally related to such residential development not to exceed ten percent of the cost of such residential development in accordance with the terms contained in this ordinance. Any such residential development shall be located within the municipality.
(e) "Development costs" means and includes the sum total of all reasonable or necessary costs incidental to the acquisition, construction, reconstruction, rehabilitation, repair, alteration, improvement and extension of a residential development, including, without limitation, the following: the cost of studies and surveys; plans and specifications; architectural and engineering services; underwriting fees; legal, accounting, marketing and other special services relating to residential development or incurred in connection with the issuance and sale of bonds; necessary application and other fees to federal, state and local government agencies for any requisite approvals for construction, for assisted financing or otherwise; financing, acquisition, demolition, construction, equipment and site development of new and rehabilitated buildings; the relocation of utilities, public ways and parks; the construction of recreational, cultural and commercial facilities; rehabilitation, reconstruction, repair or remodeling of existing buildings and all other necessary and incidental expenses, including trustee and rating agency fees and an initial bond and interest reserve together with interest on bonds issued to finance a residential development to a date six months subsequent to the estimated date of completion; any premiums for mortgage insurance or insurance with respect to bonds; and such other expenses as the municipality may deem appropriate to effectuate the purposes of this ordinance.
(f) "Lending institution" means any bank, trust company, savings bank, national banking association, savings and loan association, building and loan association, mortgage banker or other financial institution or governmental agency which customarily provides service or otherwise aids in the financing of mortgages on single-family residential housing or multifamily residential housing located in the municipality or any holding company for any of the foregoing.
(g) "Home mortgage" means an interest-bearing loan to a mortgagor for the purpose of purchasing or improving a home, evidenced by a promissory note and secured by a mortgage on such home, but shall not include a loan primarily for the purpose of refinancing an existing loan.
(h) "Home" means real property and improvements thereon located within the municipality consisting of not more than six dwelling units, including but not limited to condominium units, owned by one mortgagor who occupies or intends to occupy one of such units.
(i) "Mortgagor" means a person or persons whose adjusted gross aggregate income, together with the adjusted gross aggregate income of all persons who intend to reside with such person or persons in one dwelling unit, shall not have exceeded $50,000.00 for the immediately preceding taxable year and who has received a home mortgage on a home.
(Prior code § 7-85)
It is hereby determined and declared that the purpose of this ordinance is to provide a means of financing the cost of residential ownership and development that will provide decent, safe and sanitary housing for residents of the municipality at prices they can afford; it is further determined and declared that such residential ownership and development will (a) provide for and promote the public health, safety, morals, and welfare; (b) relieve conditions of unemployment and encourage the increase of industry and commercial activity and economic development so as to reduce the evils attendant upon unemployment; (c) provide for efficient and well-planned urban growth and development including the elimination and prevention of potential urban blight and the proper coordination of industrial facilities with public services, mass transportation and residential development; (d) assist low- and moderate-income persons in acquiring and owning decent, safe and sanitary housing which they can afford; (e) promote the integration of families of varying economic means; and (f) preserve and increase the municipality's ad valorem tax base; and the foregoing are hereby determined and declared to be public purposes and functions pertaining to the government and affairs of the municipality.
(Prior code § 7-86)
In addition to powers which the municipality may now have, the municipality shall have all powers necessary to accomplish the purposes of this ordinance including, but not limited to, the following:
(a) Residential development. The municipality shall have the power to plan, conduct research, study, develop and promote the establishment of residential development.
(b) Home mortgages. The municipality shall have the power:
(1) To acquire, and contract and enter into advance commitments to acquire, home mortgages owned by lending institutions at such purchase prices and upon such other terms and conditions as shall be determined by the municipality or such other person as it may designate as its agent, to make and execute contracts with lending institutions for the origination and servicing of home mortgages and to pay the reasonable value of services rendered under those contracts;
(2) To make loans to lending institutions under terms and conditions which, in addition to other provisions as determined by the municipality, shall require the lending institutions to use substantially all of the net proceeds thereof, directly or indirectly, for the making of home mortgages in an aggregate principal amount substantially equal to the amount of such net proceeds;
(3) To establish, by rules or regulations, in ordinances relating to any issuance of bonds or in any financing documents relating to such issuance, such standards and requirements applicable to the purchase of home mortgages or the making of loans to lending institutions as the municipality deems necessary or desirable, including but not limited to: (i) the time within which lending institutions must make commitments and disbursements for home mortgages; (ii) the location and other characteristics of homes to be financed by home mortgages; (iii) the terms and conditions of home mortgages to be acquired; (iv) the amounts and types of insurance coverage required on homes, home mortgages and bonds; (v) the representations and warranties of lending in situations confirming compliance with such standards and requirements; (vi) restrictions as to interest rate and other terms of home mortgages or the return realized therefrom by lending institutions; (vii) the type and amount of collateral security to be provided to assure repayment of any loans from the municipality and to assure repayment of bonds; and (viii) any other matters related to the purchase of home mortgages or the making of loans to lending institutions as shall be deemed relevant by the municipality; provided, however, that in no case shall any such lending institution charge and retain an origination fee in excess of three percent of the principal amount of any such home mortgage; and, further provided, the interest rate on such home mortgage (or on the municipality's participation interest in such home mortgage if the municipality shall own less than 100 percent of such home mortgage) shall be at least one and one-half percent less than the stated interest rate being charged on 95 percent loan-to-value ratio mortgages made in the municipality or one percent less than the stated interest rate for 80 percent loan-to-value mortgages made in the municipality. The determination of such rates shall be made on any reasonable basis as determined by the comptroller, on a day established by the comptroller reasonably proximate to the date of execution of a contract for the sale of the related bonds;
(4) To require from each lending institution from which home mortgages are purchased or to which loans are made the submission, at the time of such purchase or loan, of evidence satisfactory to the municipality of the ability and intention of such lending institution to make home mortgages, and the submission, within the time specified by the municipality for making disbursements for home mortgages, of evidence satisfactory to the municipality of the making of home mortgages and of compliance with any standards and requirements established by the municipality; in connection therewith, the municipality may inspect the books and records of such lending institutions.
(c) Bonds. The municipality shall have the power:
(1) To issue its bonds to defray, in whole or in part, the development costs of any residential development; to issue its bonds to defray, in whole or in part, the costs of purchasing, or funding the making of, home mortgages including, but not limited to, the costs of studies and surveys, insurance premiums, underwriting fees, legal, accounting and marketing services incurred in connection with the issuance and sale of such bonds, including bond and interest reserve accounts and trustee, custodian and rating agency fees; and to designate appropriate names for such bonds. The municipality need not acquire or hold title to or any interest in a residential development or home mortgages;
(2) To rent, lease, sell or otherwise dispose of any residential development or home mortgages, in whole or in part, or to loan sufficient funds to any person to defray, in whole or in part, the development costs of any residential development or the costs of purchasing home mortgages, so that the rents or other revenues to be derived with respect to the residential development or home mortgages, together with any insurance proceeds, reserve accounts and earnings thereon shall be designed to produce revenues and receipts at least sufficient to provide for the prompt payment at maturity of principal, interest and redemption premiums, if any, upon all bonds issued to finance such costs;
(3) To pledge any revenues and receipts to be received from any residential development or home mortgages to the punctual payment of bonds authorized under this ordinance, and the interest and redemption premiums, if any, thereon;
(4) To mortgage, pledge or grant security interests in any residential development, home mortgages, notes or other property in favor of the holder or holders of bonds issued therefor;
(5) To sell and convey any residential development or home mortgages, including, without limitation, the sale and conveyance thereof subject to a mortgage, pledge or security interest, if any, as provided in the ordinance relating to the issuance of the bonds for such prices and at such times as the governing body of the municipality may determine;
(6) To issue its bonds to refund in whole or in part at any time bonds theretofore issued by the municipality under authority of this ordinance;
(7) To apply for and accept on its own behalf or on behalf of any person, advances, loans, grants, contributions, guarantees, rent supplements, mortgage assistance and any other form of financial assistance from the federal government, the state, any county or municipality, or any other public or quasi-public body, corporation or foundation, or from any other source, public or private, including any person, for any of the purposes of this ordinance, and to include in any contract for financial assistance such conditions as it may deem reasonable and appropriate and which are not inconsistent with the purposes of this ordinance;
(8) To make and execute contracts and other instruments necessary or convenient to the exercise of any of the powers granted herein;
(9) Bonds shall not be issued hereunder unless they receive at least an "A" rating from one of the nationally recognized rating agencies.
(Prior code § 7-87)
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