NOTICE OF PUBLIC HEARING
ON PROPOSED PROJECT
AND FINANCIAL ASSISTANCE
Notice is hereby given that a public hearing pursuant to Section 859-a(2) of the General Municipal Law of the State of New York (the “Act”) and Section 147(f) of the Internal Revenue Code of 1986, as amended (the “Code”) will be held by County of Chautauqua Industrial Development Agency (the “Issuer”) on the 15th day of September, 2014 at 10:00 o’clock a.m., local time, at in the Conference Room at the offices of the Issuer located at 200 Harrison Street in the City of Jamestown, Chautauqua County, New York, in connection with the following matters:
Covenant Manor Apartments, LLC (the “Applicant”), on behalf of Prairie Covenant NY, Ltd., a New York to-be-formed limited partnership (the “Company”), has presented an application (the “Application”) to the Issuer, a copy of which Application is on file at the office of the Issuer, requesting that the Issuer consider undertaking a project (the “Project”) for the benefit of the Company, said Project consisting of the following: (A) (1) the acquisition of approximately 0.62 acres of land located at 23 West Third Street in the City of Jamestown, Chautauqua County, New York (the “Land”), together with an existing approximately 120,000 square foot, 8-storey building and parking and related improvements located thereon and at 107 West Second Street in the City of Jamestown (collectively, the “Facility”), (2) the renovation of the Facility, and (3) the acquisition and installation thereon and therein of certain related furniture, fixtures, machinery and equipment (the “Equipment”) (the Land, the Facility and the Equipment hereinafter collectively referred to as the “Project Facility”), all of the foregoing for use by the Company as a low to moderate income senior independent living facility; (B) the financing of all or a portion of the costs of the foregoing by the issuance of revenue bonds of the Issuer in one or more issues or series in an aggregate principal amount sufficient to pay the cost of undertaking the Project, together with necessary incidental costs in connection therewith, presently estimated to be approximately $4,460,000 and in any event not to exceed $6,000,000 (the “Obligations”); (C) the payment of a portion of the costs incidental to the issuance of the Obligations, including issuance costs of the Obligations and any reserve funds as may be necessary to secure the Obligations; (D) the granting of certain other “financial assistance” (within the meaning of Section 854(14) of the Act) with respect to the foregoing, including potential exemptions from certain sales and use taxes, real property taxes, real estate transfer taxes and mortgage recording taxes (collectively with the Obligations, the “Financial Assistance”); and (E) the lease (with an obligation to purchase) or sale of the Project Facility to the Company or such other person as may be designated by the Company and agreed upon by the Issuer.
The Issuer is considering whether (A) to undertake the Project, (B) to finance the Project by issuing, from time to time, the Obligations, (C) to use the proceeds of the Obligations to pay the cost of undertaking the Project, together with necessary incidental costs in connection therewith, and (D) to provide certain exemptions from taxation with respect to the Project, including (1) exemption from mortgage recording taxes with respect to any documents, if any, recorded by the Issuer with respect to the Project in the office of the County Clerk of Chautauqua County, New York or elsewhere, (2) exemption from deed transfer taxes on any real estate transfers, if any, with respect to the Project, (3) exemption from sales taxes relating to the acquisition, construction, renovation and installation of the Project Facility, and (4) in the event that the Project Facility would be subject to real property taxation if owned by the Company but shall be deemed exempt from real property taxation due to the involvement of the Issuer therewith, exemption from real property taxes (but not including special assessments and special ad valorem levies), if any, with respect to the Project Facility, subject to the obligation of the Company to make payments in lieu of taxes with respect to the Project Facility. If any portion of the Financial Assistance to be granted by the Issuer with respect to the Project is not consistent with the Issuer’s uniform tax exemption policy, the Issuer will follow the procedures for deviation from such policy set forth in Section 874(4) of the Act prior to granting such portion of the Financial Assistance.
If issuance of the Obligations is approved, interest on the Obligations will not be excludable from gross income for federal income tax purposes unless (A) pursuant to Section 147(f) of the Code and the regulations of the United States Treasury Department thereunder (the “Treasury Regulations”), the issuance of the Obligations is approved by the County Executive of County of Chautauqua, New York after the Issuer has held a public hearing on the nature and location of the Project Facility and the issuance of the Obligations; and (B) pursuant to Section 142(a)(7) of the Code, at least ninety-five percent (95%) of the net proceeds of the Obligations are used to provide a “qualified residential rental project” within the meaning of such quoted term in Section 142(d) of the Code.
If the Issuer determines to proceed with the Project and the issuance of the Obligations, (A) the Project Facility will be acquired, constructed, reconstructed and installed by the Issuer and will be leased (with an obligation to purchase) or sold by the Issuer to the Company or its designee pursuant to a project agreement (the “Agreement”) requiring that the Company or its designee make payments equal to debt service on the Obligations and make certain other payments and (B) the Obligations will be a special obligation of the Issuer payable solely out of certain of the proceeds of the Agreement and certain other assets of the Issuer pledged to the repayment of the Obligations. THE OBLIGATIONS SHALL NOT BE A DEBT OF THE STATE OF NEW YORK OR COUNTY OF CHAUTAUQUA, NEW YORK, AND NEITHER THE STATE OF NEW YORK NOR COUNTY OF CHAUTAUQUA, NEW YORK SHALL BE LIABLE THEREON.
The Issuer has not yet made a determination pursuant to Article 8 of the Environmental Conservation Law (the “SEQR Act”) regarding the potential environmental impact of the Project.
The Issuer will at said time and place hear all persons with views on either the location and nature of the proposed Project, the Financial Assistance being contemplated by the Issuer in connection with the proposed Project or the proposed plan of financing the proposed Project by the issuance from time to time of the Obligations. A copy of the Application filed by the Company with the Issuer with respect to the Project, including an analysis of the costs and benefits of the Project, is available for public inspection during business hours at the offices of the Issuer. If the Issuer determines to issue any portion of the Bonds as federally tax-exempt obligations, a transcript or summary report of the hearing will be made available to the County Executive of County of Chautauqua, New York. Approval of the issuance of the Obligations by County of Chautauqua, New York, acting through its elected County Executive, is necessary in order for the interest on the Obligations to qualify for exemption from federal income taxation.
Additional information can be obtained from, and written comments may be addressed to: Kevin M. Sanvidge, Administrative Director/Chief Executive Officer, County of Chautauqua Industrial Development Agency, 200 Harrison Street, Jamestown, New York 14701-6902; Telephone: (716) 661-8900.
Dated: August 27, 2014.
COUNTY OF CHAUTAUQUA INDUSTRIAL DEVELOPMENT AGENCY
BY: Kevin Sanvidge
Administrative Director/Chief Executive Officer