Legal Notice
ORDINANCE #2023-01
AN ORDINANCE TO RATIFY AN
EXISTING
PRIVILEGE
LICENSE TAX
AND TO
AUTHORIZE THE PLEDGE OF A SPECIFIED
PORTION OF
THE PROCEEDS THEREOF FOR THE HEALTHCARE AUTHORITY OF HALEYVILLE
AND WINSTON COUNTY,
ALABAMA
BE IT ORDAINED by the City Council of the City of Haleyville, Alabama (the “City Council”), as governing body of the City of Haleyville, Alabama (the “City”), as follows:
Section 1.
Representations and Definition of Terms
The City Council has found and determined, and does hereby find, determine and declare:
(a) Pursuant to Article 3 of Chapter 51 of Title 11 of the Code of Alabama 1975 the City has provided for the levy and collection of privilege license taxes (the “City Sales Tax”) within the corporate limits of the City by Ordinance No. 2017-12, as true and correct copy of which is attached hereto as Exhibit A and made a part of this ordinance.
(b) Pursuant to Section 9-67 of Ordinance No. 2017-12 the City has provided for the allocation of a specified portion of the proceeds of the City Sales Tax for the use and benefit of The Healthcare Authority of the City of Haleyville and Winston County, Alabama (the “Authority”), a public corporation under Article 11 of Chapter 21 of Title 22 of the Code of Alabama 1975 (the “Authority Law”).
(c) Ordinance No. 2017-12 is in full force and effect without amendment thereto.
(d) The City has heretofore delivered that certain Special Public Hospital Agreement dated December 15, 2020 ("the Hospital Agreement") to the Authority pursuant to which the City has agreed to pay, for the account of the Authority in each fiscal year, to Regions Bank, as trustee for the Authority, an amount of the City Sales Tax equal to the greater of (i) 12.5% of the net proceeds of the City Sales Tax or (ii) the "Coverage Amount", being the amount by which 120% of the annual debt service on the indebtedness of the Authority evidenced by the revenue bonds of Series 2020-A and Series 2020-B (including all generations of refunding bonds) of the Authority exceeds the amount provided to the Trustee for such purpose in each fiscal year by Winston County, Alabama, from the proceeds of the special hospital ad valorem tax levied under Amendments Nos. 72 and 76 to the Constitution of Alabama of 2022.
(e) The Authority has advised the City that the Authority needs to obtain a credit agreement to provide for a line of credit of approximately $3,000,000 (the "Line of Credit") pursuant to the Authority Law to provide for the operation, maintenance and capital improvement of the public health care facilities of the Authority and requires a pledge of an additional ½ cent of the net proceeds of the City Sales Tax to secure the payment of the Line of Credit.
(f) The Authority has advised the City that the Line of Credit will never constitute a direct, indirect, or contingent pecuniary liability or obligation of the City or a charge against the credit, funds, or revenues of the City.
(g) The Authority has requested the City, and the City finds and determines it is in the best interests of the taxpayers and citizens thereof for the City, to:
(1) amend Ordinance No. 2017-12 to:
(i) recognize the pledge by the Authority of the portion of the City Sales Tax allocated to the Authority for the benefit of the Hospital Agreement and the Line of Credit; and
(ii) provide for the continued levy and collection of the City Sales Tax at rates sufficient to provide to, or for the benefit of, the Authority each fiscal year proceeds of the City Sales Tax in an amount sufficient to pay all amounts due from the City pursuant to the Hospital Agreement and the by the Authority under the Line of Credit; and
(2) ratify and confirm the levy and collection of the City Sales Tax on the terms of Ordinance No. 2017-12.
Section 2.
Amendment of Section 9-67 of
Ordinance No. 2017-12
The Council amends Section 9-67 of Ordinance No. 2017-12 by deletion of said Section 9-67 in the entirety thereof and substitution therefor of the following:
“Section 9-67. Use of Proceeds from Taxes Herein Levied; Duration of Levy of Taxes for Specified Purposes
(a) The proceeds from the taxes herein levied remaining after payment of the costs of collecting the said taxes, including without limitation all charges by HDL therefor, and paid on account of collection of the same, shall be applied each month as follows:
(1) there shall be delivered to The Healthcare Authority of Haleyville and Winston County, Alabama (the “Authority”) for use for the corporate and public healthcare purposes thereof as provided by law, the following amounts (collectively the "Healthcare Amount"):
(i) the greater of (A) 12.5% of the net proceeds of the City Sales Tax or (B) the "Coverage Amount", being the amount by which 120% of the annual debt service on the indebtedness of the Authority the amount by which 120% of the annual debt service on the indebtedness of the Authority evidenced by the revenue bonds of Series 2020-A and Series 2020-B (including all generations of refunding bonds) of the Authority exceeds the amount provided to the Trustee for such purpose in each fiscal year by Winston County, Alabama, from the proceeds of the special hospital ad valorem tax levied under Amendments Nos. 72 and 76 to the Constitution of Alabama of 2022; and
(ii) the amount of ½ cent on each dollar taxed of the net proceeds of the City Sales Tax to provide for the payment of amounts due in respect of the Line of Credit; and
(2) there shall be delivered to the City Board of Education of the City of Haleyville, Alabama, for use for the public educational purposes thereof as provided by law, an amount equal to 7.5% of the net proceeds of such taxes remaining after payment of the Healthcare Amount; and
(3) there shall be deposited in the General Fund of the City, for use for the lawful purposes of the City, an amount equal to 67.5% of the net proceeds of such taxes remaining after payment of the Healthcare Amount.
(b) The City of Haleyville covenants and agrees:
(1) to levy and collect the taxes levied pursuant to Section 9-60 of this Ordinance (i) at rates sufficient to provide to the Authority in each month an amount not less than the Healthcare Amount and (ii) for a period commencing on the date of adoption of this Ordinance and continuing thereafter until the principal of and interest on any obligations of the Authority and secured by a pledge of the Healthcare Amount shall have been paid in full or provision made therefor; and
(2) to provide the Healthcare Amount to the Authority each month pursuant to Section 9‑67(a); and
(3) the Authority may pledge and apply the Healthcare Amount for the benefit of any obligations of the Authority.
Section 3.
Ratification of
Ordinance No. 2017-12 and Taxes
(a) The Council ratifies and confirms the terms and provisions of Ordinance No. 2017-12 as amended by this Ordinance.
(b) The Council ratifies and confirms the assessment, levy and collection of the privilege license taxes pursuant to Ordinance No. 2017-12, as amended by his Ordinance, in all respects.
Section 4.
Contract
The City covenants and agrees the provisions of this Ordinance shall constitute a contract with The Healthcare Authority of Haleyville and Winston County, Alabama.
Section 5.
Repeal of
Conflicts
All resolutions, ordinances and parts thereof in conflict or inconsistent with the provisions of this Ordinance are hereby, to the extent of such conflict or inconsistency, repealed.
Section 6.
Effective Date
This Ordinance shall take effect upon publication hereof as provided by law.
The foregoing Ordinance is adopted on this 21st day of February 2023.
Ken Sunseri
Mayor
Attest:
Christy Harbin
City Clerk
OR_Mar 1
1312