RES 18-743 - Authorizing Interfund Loan to PAEC RESOLUTION NO. 18-743
A RESOLUTION of the City Council of the City of Federal Way,
Washington,authorizing an Interfund Loan of up to$500,000 from the
General Fund, Information Technology Fund, REET Fund, Fleet and
Equipment Fund,Streets Capital Fund,Utility Tax Fund,and Strategic
Reserve Fund to fund the cash flow management of the Performing Arts
& Event Center Operations Fund of the City of Federal Way.
WHEREAS, the City of Federal Way ("City") has entered into a Management Agreement
with Spectra Venue Management("Manager")to manage and operate the Performing Arts&Event
Center("Facility") on behalf and for the benefit of the City; and
WHEREAS, the Manager shall pay all items of expense for the operation, maintenance,
supervision and management of the Facility from the funds in the Operating Checking Account for
the Facility; and
WHEREAS, the Operating Checking Account shall be funded with amounts generated by
operation of the Facility,or otherwise made available by the City; and
WHEREAS,to ensure sufficient funds are available in the Operating Checking Account,City
will advance in the Operating Checking Account, enough for its cash flow management; and
WHEREAS, the City shall thereafter, on or before the 1st day of each succeeding month
following the Effective Date, deposit (or allow to remain) in the Operating Checking Account the
budgeted or otherwise approved expenses for each such month,retaining at all times in the accounts
funding for the upcoming 3-month period; and
WHEREAS,the Performing Arts&Event Center Operations fund will need up to$500,000
to manage the cash flow needs of the Facility operations per the Management Agreement; and
Resolution No. 18-743 Page 1 of 4
WHEREAS,the City's General Fund,Information Technology Fund,REET Fund,Fleet and
Equipment Fund,Streets Capital Fund,Utility Tax Fund,and Strategic Reserve Fund(loaning funds)
have adequate fund balances to provide a revolving inter-fund loan and such funds are being invested
in the State Investment Pool at the current rate of 2.01% (as of August 31, 2018); and
WHEREAS, the City is paying 2.17% on its last General Obligation Bond issued in 2017;
and
WHEREAS,the loaning funds will earn 0.09%more than the State Investment Pool current
rate of 2.01%from a revolving inter-fund loan.
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF FEDERAL WAY,
RESOLVES AS FOLLOWS:
Section 1. The Performing Arts & Event Center Operations Fund is authorized to borrow
from the City's other loaningfunds an amount of upto$500,000,for the purpose of funding the cash
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flow of the operation, maintenance, supervision and management of the Facility pursuant to the
Management Agreement with the Manager.The term of the revolvingloan shall be fora period not
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to exceed three years from the day of first advance at an annual interest rate of 2.10% (current
Washington State Investment Pool's earning rate is 2.01%as of August 31,2018).The Performing
Arts&Event Center Operations Fund may pay off the revolving loan or make extra payment at any
time during the life of the loan.
Section 2. The Finance Director is authorized to process and administer a temporary
revolving loan of up to $500,000 from the available cash of the loaning funds, where money
deposited therein is not immediately needed for the purposes of that fund,to the Performing Arts&
Event Center Operations Fund.
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Section 3. Severability.If any section,sentence,clause or phrase of this resolution should be
held to be invalid or unconstitutional by a court of competent jurisdiction, such invalidity or
unconstitutionality shall not affect the validity or constitutionality of any other section, sentence,
clause, or phrase of this resolution.
Section 4. Corrections. The City Clerk and the codifiers of this resolution are authorized to
make necessary corrections to this resolution including, but not limited to, the correction of
scrivener/clerical errors, references, resolution numbering, section/subsection numbers and any
references thereto.
Section 5.Ratification.Any act consistent with the authority and prior to the effective date of
this resolution is hereby ratified and affirmed.
Section 6.Effective Date.This resolution shall be effective immediately upon passage by the
Federal Way City Council.
RESOLVED BY THE CITY COUNCIL OF THE CITY OF FEDERAL WAY,
WASHINGTON this 2nd day of October,2018.
[signature page to follow]
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CITY OF FEDERAL WAY:
F RELL, MAYOR
ATTEST:
S W�/ I MA/ti
'H A NIE COURTNEY, C , CITY CLERK
APPROVED AS TO FORM:
J. RYAN CALL, CITY ATTORNEY
FILED WITH THE CITY CLERK: 09/26/2018
PASSED BY THE CITY COUNCIL: 10/02/2018
RESOLUTION NO.: 18-743
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