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Home My WebLink AboutRESOLUTION - 36-96 - 7/23/1996 - GROVE MALL PROJECT/CONTRACTRESOLUTION NO. 36-96 A RESOLUTION AUTHORIZING THE VILLAGE PRESIDENT AND VILLAGE CLERK TO E�7CUTE A CONTRACT WITH CHAPMAN & CUTLER FOR BOND COUNSEL SERVICES REGARDING THE GROVE MALL PROJECT NOW, THEREFORE, BE IT RESOLVED by the President and Board of Trustees of the Village of Elk Grove Village, Counties of Cook and DuPage, State of Illinois as follows: Section 1: That the Village President be and is hereby authorized to sign the attached documents marked: CONTRACT SERVICES RE: Village of Elk Grove Village, Cook County, Illinois Proposed Arlington Heights Road and Biesterfield Road Tax Increment Area and Related Bonds a copy of which is attached hereto and made a part hereof as if fully set forth and the Village Clerk is authorized to attest said documents upon the signature of the Village President. Section 2: That this Resolution shall be in full force and effect from and after its passage and approval according to law. VOTE: AYES: 5 NAYS: p ABSENT: 0— PASSED this 23rd day of July , 1996. APPROVED this 23rd day of July , 1996. Dennis J. Gallitano Village President rsvw4xW Patricia S. Smith Village Clerk Law Offices of CHAPMAN AND CUTLER Theodore S. Chapman 111 West Monroe Street, Chicago, Illinois 60603-4080 1877-1943 TWX 910-221-2103 Telex 206281 Henry E. Cutler FAX (312) 701-2361 1879-1959 Telephone (312) 845-3000 July 16, 1996 Mr. Dennis J. Gallitano Village President Village of Elk Grove Village 901 Wellington Avenue Elk Grove Village, Illinois 60007-3499 Re: Village of Elk Grove Village, Cook County, Illinois Proposed Arlington Heights Road and Biesterfreld Road Tax Increment Area and Related Bonds Dear Mr. Gallitano; 2 North Central Avenue Phoenix, Arizona 85004 (602) 256-4060 50 South Main Street Salt Lake City, Utah 04144 (801) 533-0066 Pursuant to our recent discussions regarding the area ("Area") and bonds ("Bonds") in reference, we have prepared this letter setting forth information about our responsibilities as finance counsel ("Bond Counsel") in connection therewith. I. ROLE OF BOND COUNSEL A. Services Prior to Issuance In general, our services as Bond Counsel during the course of a tax increment financing leading up to the closing include the following: 1. Review of the matters incident to the authority and powers of the Village to carry out its corporate functions and to issue the Bonds, including specifically the Area organizational proceedings; 2. Consultation with the Village and its counsel with respect to the proceedings which may be necessary in connection with the Area organization and to implement the legal authority of the Village to issue the Bonds; 3. Consultation, review and assistance in connection with any other contracts relating to the validity or tax-exempt status of the Bonds which the Village enters into in connection with the financing; and 4. Preparation and review of drafts of the various documents essential to the validity and tax-exempt status (if applicable) of the Bonds and securing the Bonds, 500788.01.02.8 2023836-TVM-7/22/96 Lav Offices d CHAPMAN AND CUTLER Mr. Dennis J. Gallitano July 16, 1996 Page 2 including, without limitation, the various authorizing resolutions or ordinances, any trust indentures pursuant to which the Bonds will be issued, and any revenue agreements or other agreements in connection with the validity or tax-exempt status of the Bonds and the underlying security therefor. B. Opinion at Issuance Our function as Bond Counsel in a tax increment financing is to help assure the proper organization of the Area and, eventually, render an approving legal opinion with respect to the authorization and issuance of the Bonds. This opinion is rendered in written form at the time Bonds are delivered. It will cover the following matters: (a) the form of bond prescribed for the issue, (b) the legality of the Bonds and the various authorizing proceedings, (c) the source of payment for the Bonds, (d) the tax-exempt status of the Bonds, if applicable, and (e) the status of the Bonds as "qualified tax-exempt obligations" under Section 265(b)(3) of the Internal Revenue Code of 1986. C. Limitations on our Role; Additional Services As Bond Counsel, we are generally neutral and independent in the negotiation of the various business terms of a bond issue and the provisions of the documents. Our responsi- bility with respect to such terms and provisions will be limited to documenting whatever understandings the Village may reach with the users of its facilities, its underwriters or financial advisors, or the bondholders in accord with the enabling legislation. We do not, as Bond Counsel, undertake to provide counsel in matters relating to securities or blue-sky laws. These matters relate primarily to advice on the drafting of an official statement and on the qualification of bonds for sale in various states. We would expect to review the portions of the official. statement describing the terms of the Bonds and the treatment of the interest on the Bonds for purposes of federal tax law. The official state- ment should contain an itemization of those portions thereof which we have reviewed and should indicate that, as bond counsel, we (lid not take any responsibility for the balance of the official statement not reviewed. We have in the past and do frequently act as securities law counsel on municipal bond issues. Services rendered in connection with any tax objections, Internal Revenue Service audits, litigation, tax rulings, public registration matters or other items outside the scope of the services described herein would be covered in additional billings which would be discussed with you prior to undertaking any such additional work. Lax Offices of CHAPMAN AND CUTLER Mr. Dennis J. Gallitano July 16, 1996 Page 3 II. FEES A. Basis for Our Fee in General Generally, our fees as bond counsel are determined on a transactional basis — that is, our fee is based on a percentage of the Bonds rather than on a strict time basis. We attempt to relate our fee to the following factors, among others: (a) the appropriate amount of time to do the work, (b)the risk involved in writing the opinion — this risk is related to the issue size and security for the repayment of the bond issue; (c) the complexity of the bond issue; (d) recognition that we carry the time for services rendered on our books until the Bonds are issued rather than render a statement monthly or quarterly as work progresses; and (e) services and advice we frequently and routinely provide for no charge after bonds are issued, such as brief periodic consultations regarding the interpretation of documents we have drafted. B. Fee for Proposed Transaction We understand we will be retained as Bond Counsel through the closing of the pro- posed transaction for the Bonds and our estimate is based on that assumption. For an issue of Bonds ranging in size from $2 million to $5 million, our fee may be determined as follows: Base Fee, Non -contingent and Payable: even if No Bonds Issued For General Obligation Taxable Bonds For Revenue Taxable Bonds For Tax-exempt Bonds (either General Obligation or Revenue) --$1-5-,999- $7,500 DJG An additional $3,000 for $2,000,000 in Bonds plus 0.25% of Bonds above $2,000,000 To all of the above -charges, an additional $2,000 for $2,000,000 in Bonds plus 0.10% of Bonds above $2,000,000 To the above -charges, as applicable, additional 0.25% of all Bonds issued We should explain that the above flee quote is more elaborate than usual because the best Village means of financing have yet to be determined, and the Village may ultimately find it to be in its best interests to internally finance (that is, not issue Bonds). Changes in the issue size or the nature or structure of the transaction, as currently proposed, may result in changes in our fee which we would be pleased to discuss with you. Law Offices W CHAPMAN AND CUTLER Mr. Dennis J. Gallitano July 16, 1996 Page 4 C. Expenses and Separately Charged Items Expenses and separately charged items will be billed separately. These include telephone, photocopy and word processor expenses, travel and conference expenses, and postage and special courier amounts. These amounts will be itemized in our statements. III. LAWYERS INVOLVED Timothy V. McGree and Patricia M. Curtner of our office will work with the Village in connection with the issuance of the Bonds. The firm's approach to its responsibilities as bond counsel to the Village will be to undertake each aspect of the representation with the resources of the firm best able to perform the service required by the Village. Although the undersigned attorneys would assume primary responsibility for performing the services of Bond Counsel, the entire resources of the firm, most particularly its broadly-based financial capabilities, will be available to the Village as appropriate to fulfill our responsibilities as bond counsel. IV. CONCLUSION We hope that the services to be rendlered by our firm as bond counsel meet with your approval. Please execute a copy of this letter and return it for our files. If you wish to discuss the contents hereof or any other matter, please do not hesitate to contact us. Very truly yours, By o--" (/ , CZ-�C� Timothy V. McGree TVM:rw Enclosure Lew Offices of CHAPMAN AND CUTLER Mr. Dennis J. Gallitano July 16, 1996 Page 5 The foregoing offer of services as bond counsel in the matter indicated has been received and is hereby approved and accepted this 23rd day of July 1996. VILLAGE OF ELK GROVE VILLAGE COOK COUNTY, ILLINOIS By: Dennis J. Gallitano Dennis J. Gallitano Village President