A Resolution authorizing a loan under a Loan Agreement between The Metropolitan Government of Nashville and Davidson County, Tennessee and the Tennessee State School Bond Authority in an aggregate principal amount of not to exceed Six Million Three Hundred Fifty Thousand Dollars ($6,350,000) and to execute and deliver the Loan Agreement and other documents relating to said borrowing; providing for the application of the proceeds of said borrowing and the payment of the Metropolitan Government's obligations under the Loan Agreement.

WHEREAS, pursuant to the Tennessee State School Bond Authority Act, Sections 49-3-1201, et seq., Tennessee Code Annotated, as amended (the "Act"), the Tennessee State School Bond Authority (the "Authority") is authorized to issue its bonds or notes to make loans to any county, metropolitan government, incorporated city or town, or special school district in the State to provide funds to rehabilitate, repair or equip schools for such local governments ("Qualified Zone Academy Projects"); and

WHEREAS, the Authority has determined that it will issue its Qualified Zone Academy Bonds, Series 2005 (the "Bonds"), for the purpose of making loans to The Metropolitan Government of Nashville and Davidson County, Tennessee (the "Metropolitan Government"), in addition to other cities and counties in the State, to fund Qualified Zone Academy Projects; and

WHEREAS, the Metropolitan Government has applied for a loan from the Authority and the Metropolitan Government's application has been approved by the Department of Education of the State and approved by the Authority for the purpose of receiving funds to renovate, repair and equip schools in the Metropolitan Government, including Glencliff High School, Maplewood High School, Pearl Cohn High School, Stratford High School, Whites Creek High School, Antioch Middle School, Bailey Middle School, Bellevue Middle School, Brick Church Middle School, Cameron Middle School, Dalewood Middle School, Donelson Middle School, Dupont Hadley Middle School, Dupont Tyler Middle School, Ewing Park Middle School, Goodlettsville Middle School, H.G. Hill Middle School, Head Middle School, J.T. Moore Middle School, Jerre Baxter Middle School, Joelton Middle School, John Early Middle School, Litton Middle School, Martha Vaught Middle School, McKissick Middle School, McMurray Middle School, Neely's Bend Middle School, Rose Park Middle School, Two Rivers Middle School, W.A. Bass Middle School, West End Middle School, Wharton Middle School and Wright Middle School (collectively, the "Projects") each of which is a Qualified Zone Academy Project; and

WHEREAS, the Projects are located at Metropolitan Government schools which are established and operated by the local education agency of the Metropolitan Government to provide education and training below the post-secondary level and are either in an empowerment zone or at least 35% of the students attending the schools at which the Projects will be installed or participating in the program are eligible for free or reduced cost lunch programs under the school lunch program established under the National School Lunch Act; and

WHEREAS, the Metropolitan Government has received a written commitment from one or more private entities to make a qualified contribution consisting of equipment, technical assistance, training, services of employees as volunteer mentors, internships, field trips or other educational opportunities outside the schools for students having a present value of not less than 10% of the proceeds of the loan requested for the Projects; and

WHEREAS, under the Act, the Metropolitan Government is authorized to enter into a loan agreement with the Authority to finance the Projects; and

WHEREAS, it is hereby determined to be in the best interests of the Metropolitan Government to finance the Projects through a loan from the Authority to the Metropolitan Government (the "Loan Agreement") whereby the Metropolitan Government will pledge its full faith and credit and unlimited taxing power to the payment of its obligations thereunder, including payment of amounts sufficient to pay its allocable share of the principal on the Bonds, costs of issuance of the Bonds, and certain administrative expenses; and

WHEREAS, the Loan Agreement shall be additionally secured by a pledge by the Metropolitan Government of taxes imposed and collected by the State pursuant to law and appropriated and allocated to the Metropolitan Government as identified by resolution of the Tennessee Local Development Authority and as established by Section 4-31-102, Tennessee Code Annotated, as amended from time to time ("State-Shared Taxes"), which have not been pledged or applied to any other indebtedness ("Unobligated State-Shared Taxes") in an amount equal to the maximum annual principal payments to be made under the Loan Agreement; and

WHEREAS, the Metropolitan Government has pledged its State-Shared Taxes to other indebtedness of the Metropolitan Government; however, the Metropolitan Government has Unobligated State-Shared Taxes remaining in an amount greater than 100% maximum annual principal payments to be made under the Loan Agreement; and

WHEREAS, there has been presented to this meeting the form of the Loan Agreement as attached to this Resolution which appears to be in appropriate form and is an appropriate instrument to be executed and delivered for the purposes intended; and

WHEREAS, for the purposes of authorizing the loan from the Authority, the execution and delivery of the Loan Agreement by the Metropolitan Government, the pledging of the Metropolitan Government's full faith and credit and a portion of its Unobligated State-Shared Taxes for the payment of its obligations under the Loan Agreement, approving the assignment of such pledge to secure the Bonds, and authorizing the execution of such documents and certificates as shall be necessary to consummate the sale and delivery of the Bonds and of the Loan Agreement, the Metropolitan Council (the "Governing Body") of the Metropolitan Government adopts this Resolution.

Now, Therefore, be it resolved by the Council of The Metropolitan Government of Nashville and Davidson County, as follows:

ARTICLE I.
APPROVAL, LEVY AND PLEDGE

Section 1.1. Approval of Loan. For the purpose of providing funds to finance the costs of the Projects, including the payment of legal and fiscal costs incident to the issuance and sale of the Bonds and the Loan Agreement and making and receiving the loan herein authorized, there is hereby authorized a loan ("Loan") from the Authority in a principal amount not to exceed $6,350,000. The Metropolitan Government shall make annual payments of principal in amounts equal to approximately level debt service payable in the years 2006 through 2023; provided, however, the final dates and amortization of principal amounts of the Loan may be adjusted by the Metropolitan Government as shall be determined by the Director of Finance to be in the best interests of the Metropolitan Government and as may be required by the Authority, taking into account the expected revenues available for debt service, in accordance with the terms of this resolution and the Loan Agreement upon consultation with the Director of Schools. The Loan shall not bear interest.

Section 1.2. Approval of Loan Agreement. The form, terms and provisions of the Loan Agreement which have been presented at this meeting as attached to this Resolutions are hereby approved and the Mayor is hereby authorized, empowered and directed to execute and deliver and the Metropolitan Clerk to attest the Loan Agreement in the name and on behalf of the Metropolitan Government. The Loan Agreement is to be in substantially the form now before this meeting and hereby approved, or with such changes therein as shall be approved by the Director of Finance upon consultation with the Director of Schools, the execution by the Mayor thereof to constitute conclusive evidence of approval of any and all changes or revisions therein. From and after the execution and delivery of the Loan Agreement, the Mayor, the Metropolitan Clerk, the Director of Finance and the Metropolitan Treasurer are hereby authorized, empowered and directed to do all such acts and things and to execute all such documents as may be necessary to carry out and comply with the provisions of the Loan Agreement as executed.

Section 1.3. Pledge of Taxes. (a) The Metropolitan Government hereby covenants and agrees, through the Governing Body, to annually levy and collect a tax upon all taxable property within the Metropolitan Government, in addition to all other taxes authorized by law, sufficient to pay when due the annual amounts payable by the Metropolitan Government under the Loan Agreement as and when they become due and payable and, for such purposes, the Metropolitan Government hereby pledges such tax and the full faith and credit of the Metropolitan Government to such payments, provided, however, that the tax hereinabove described will not be required to be levied or, if levied, may be proportionately reduced to the extent of funds appropriated by the Governing Body of the Metropolitan Government to the payment of the amounts described above from other revenues of the Metropolitan Government. Such tax, to the extent levied, shall be assessed, levied, collected and paid in like manner as other taxes of the Metropolitan Government. Such tax shall not be included within any statutory or other limitation of rate or amount for the Metropolitan Government but shall be excluded therefrom and be in addition thereto and in excess thereof, notwithstanding and without regard to the prohibitions, restrictions or requirements of any other law, whether public or private. Any amounts payable under the Loan Agreement falling due at any time when there are insufficient funds from the tax levy shall be paid from current funds of the Metropolitan Government out of the taxes hereby provided to be levied when the same shall have been collected.

(b) The Metropolitan Government has pledged its State-Shared Taxes to other obligations; however, the Metropolitan Government has Unobligated State-Shared Taxes remaining in an amount greater than 100% of the maximum annual principal payments to be made under the Loan Agreement. The Metropolitan Government additionally pledges its Unobligated State-Shared Taxes in an amount equal to the maximum annual principal payments under the Loan Agreement. The Metropolitan Government hereby authorizes the Authority, without further recourse, to direct that Unobligated State-Shared Taxes pledged hereunder and due to the Metropolitan Government be withheld and paid over to the Authority for credit to the Metropolitan Government's payments due under the Loan Agreement at any time that such payments become delinquent and in an amount necessary to liquidate the amount of the delinquent payment.

ARTICLE II
MISCELLANEOUS

Section 2.1. Consent to Assignment. The Metropolitan Government hereby consents to the assignment pursuant to the Resolution of all the Authority's right, title and interest under the Loan Agreement as security for the Bonds.

Section 2.2. Additional Authorizations. All acts and doings of the Mayor, the Metropolitan Clerk, the Director of Finance, the Metropolitan Treasurer and the Director of Schools of the Metropolitan Government and any other officer of the Metropolitan Government which are in conformity with the purposes and intent of this Resolution and in furtherance of the issuance and sale of the Bonds and the execution and delivery of the Loan Agreement as set forth herein shall be and the same hereby are in all respects, approved and confirmed.

Section 2.3. Severability. If any section, paragraph or provision of this Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this Resolution.

Section 2.4. Repeal of Conflicting Resolutions and Effective Date. All other resolutions and orders, or parts thereof, in conflict with the provisions of this Resolution, are, to the extent of such conflict, hereby repealed and this Resolution shall be in immediate effect from and after its adoption.

Section 2.5. Effective Date. This Resolution shall take effect from and after its adoption, the welfare of The Metropolitan Government of Nashville and Davidson County requiring it.

Sponsored by: Diane Neighbors

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LEGISLATIVE HISTORY
Referred:	Budget & Finance Committee Education Committee
Introduced:	September 20, 2005
Adopted:	September 20, 2005
Approved:	September 21, 2005
By: