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HomeMy WebLinkAboutAGENDA REPORT 2003 0319 CC REG ITEM 09BE. T.1 MOORPARK CITY COUNCIL AGENDA REPORT TO: Honorable City Council �`� FROM: Cindy Borchard, Administrative Services Director co DATE: March 11, 2003 (Meeting of March 19, 2003) SUBJECT: Boys & Girls Club Loan BACKGROUND In 1994, the City of Moorpark provided an $82,000 loan to the Moorpark Boys and Girls Club at 5% simple interest. No payments had been made on the loan when, in 1997, the Council approved a restructuring of the loan. Under the new plan, all accrued interest would be paid, as well as principal, and the first installment was due September 30, 1998. The Boys and Girls Club did not make the scheduled payment on September 30, 1998 and paid only part of the accrued interest. On June 7, 2000, the City Council waived accrued interest due and future interest and directed that the total principal due of $82,000, be paid over 82 months with monthly installments of $1,000. Since this time, monthly principal payments have been made and as of March 6, 2003, the balance due is $52,000. DISCUSSION W. Scott Mosher, Executive Director of the Boys & Girls Club of Moorpark, submitted a letter to the City Manager requesting consideration that the remainder of the City's loan to the Club be forgiven. The request was presented to the Budget and Finance Committee members Mayor Patrick Hunter and Councilmember Clint Harper on March 5, 2003. The Budget and Finance Committee recommends that the balance of the loan be forgiven effective June 30, 2003, unless Council decides otherwise during budget deliberations due to financial impacts resulting from State budgetary actions. The outstanding balance at that time would be $47,000. 00CA28 RECOMMENDATION Forgive the loan balance Club effective June 30, modify this decision during Attachments: of $47,000 to the Boys & Girls 2003, but retain the right to budget deliberations. 1. Letter from Boys & Girls Club dated January 30, 2003 2. Promissory Note dated July 1, 2000 2 0�.>'Ld :.2 9 30YS & GIRLS CLUB OF MOORPARK P.O. Box 514 Moorpark, GA 93020 Tel 805- 529 -1140 Fax 805 -529 -2820 officers Patty Waters President Roy Talley Vve President of Admink&ahon Michael Wesner, Esq. We President of Board Development Donald I. Moore Vice President of Resource Development Scott Green sererary Board of Dk ctors Rick Baltes Gary Cabiiales Dave Chaney Robert E Coughlon, Esq. Lyle Pennington Toni Pugh Carla A. Robertson Sal Sandoval James D. Stueck Bruce Thomas Advisory CouncH January 30, 2003 Mr. Steven Kueny, City Manager City of Moorpark 799 Moorpark Avenue Moorpark, CA 93021 Dear Steve: I am writing to request that the City offset the loan to the Boys & Girls Club in lieu of the services and benefits we provide for the City and our community as a whole. As you will recall, Councilmember Clint Harper brought this idea before the Council in September of 1999. After subsequent discussions and meetings, there seemed to be general interest on the part of the Council to forgive the loan, however, there were concerns about the Club's financial stability and the lack of performance on payments at that time. Consequently, the decision then was to forgive the interest and have the Club make monthly payments of $1,000. Council expressed that they would like to see the Club establish a track record of performance and would be willing to revisit the issue in the future. Since that time we have met our obligation to the City every month, bringing our current loan balance to $53,000. 1 think you will agree that we have honored our commitment to the City to date and have a solid track record of performance. Stw* Bob Brooks N Cantwell Additionally, we have increased the level of services we provide; serving Tony Union an average of 110 young people daily, and among all of our services, Bill McMahan Su Judy Mikels impact the lives of over 1,800 kids annually. Our members have John W. Newton increased their grades in school and improved their study habits; have A. J. Patterson Debi Ryono increased their resistance skills to drugs, alcohol, and tobacco; and many Jaynes P. Sandoval special needs of members have been met through building relationships Doug Sp Bruce T ck ran with caring adult staff. Jahn W. Wood OD We would like to reinvest the $12,000 per year of loan payments to the ExKuew Direr. City into programs for kids. We will be successful in making a difference "t' Scott Mosher in the lives of those children we serve and the City will be successful in helping meet the needs of the young people in our community. Our success is truly your success. Most importantly, however, is that the kids of Moorpark succeed and they receive the opportunities they need. J00:130 These are exciting times at the Boys & Girls Club. We have fully utilized and have now outgrown our current facilities and we are beginning to plan for a new state of the art Boys & Girls Club, an additional facility to better serve the growing youth population in Moorpark. I look forward to sharing our ideas on this with you and hearing your thoughts and suggestions. Steve, I very much appreciate your support of the Boys & Girls Club and the support from the City Council. It has helped enable us to grow and deepen the impact of our services. I also believe that our work collaboratively with the Moorpark After Dark events have been very effective and we are certainly willing to look at other opportunities to work together. I would appreciate your consideration of our request that the City offset the loan to the Boys & Girls Club in lieu of the services and benefits we provide for our City. I truly believe that it would be a solid investment that would pay great dividends! I look forward to discussing this with you further. Sincerely, W. Scott Mosher Executive Director X00131 PROMISSORY NOTE Moorpark, California July 1, 2000 FOR VALUE RECEIVED, the undersigned Moorpark Boys and Girls Club, a California non - profit organization, ( "Borrower ") hereby promises to pay as herein stated to the City of Moorpark ( "City"), or order, at its principal place of business at 799 Moorpark Avenue, Moorpark, California or at any other place 3 designated by the holder hereof, the principal amount of Eighty - two Thousand Dollars ($82,000), together with simple interest on the unpaid principal amount at the rate of 5% per annum; provided, however, that such interest (the "Accrued Interest ") will not be payable unless a Default (as defined below) occurs. The principal shall be payable in equal monthly installments of $1,000 commencing with the first payment on August 1, 2000. City, at its option and without notice or demand, may declare the entire unpaid principal amount of this Promissory Note and all Past Due Interest (as defined below) and Accrued Interest to be immediately due and payable if any one or more of the following occurs (each a "Default "): (i) the sale, conveyance, transfer, lease or alienation of all or any part of the property (the "Property") located at 200 Casey Road, Moorpark, California or any interest in the Property, whether voluntary or involuntary, except where such sale, conveyance, transfer, lease or alienation is to the City, or (ii) Borrower fails to fully perform and discharge each of its obligations under this Promissory Note, including, without limitation, Borrower's failure to pay and monthly installment of principal when due and such payment failure is not completely cured within sixty (60) days following the due date of such installment. Borrower shall have the right to prepay all or any portion of the indebtedness, without penalty or premium. All prepayments will be applied to the installments of principal under this note in the inverse order of their maturity. This Note shall be governed and interpreted under the laws of the State of California. This Promissory Note is based upon City Council's approval on June 7, 2000, of the Borrower's request to restructure previous agreements for repayment of this loan. This Promissory Note supercedes the previous Promissory Note dated November 30, 1994 and any other written or oral agreements for terms of repayment of this obligation. Unless a Default OOCI432 PROMISSORY NOTE Moorpark, California July 20, 2000 Page 2 occurs, in accepting this Promissory Note, the City is waiving its right to collect interest in the amount of $5,522 (the Past Due Interest ") which is agreed by the Borrower to have been earned but unpaid under the Prior Note. Should the indebtedness represented by this Note or any part thereof be sought to be enforced or collected at law or in equity or through any bankruptcy including, without limitation, any action for relief from the automatic stay of any bankruptcy proceeding, receivership, probate or other court proceedings or by any judicial or non - judicial foreclosure proceeding, or if this Note is placed with attorneys for collection after Default, Borrower agrees to pay, in addition to all amounts due and payable hereon, reasonable attorneys' fees and collection costs and expenses. No modification or waiver by the City of any of the terms of this Promissory Note will be valid or binding on the City unless such modification or waiver is in writing and signed by the duly authorized official or officer of the City. Without limiting the generality of the preceding sentence, no delay, omission or forbearance by the City in exercising or enforcing any of its rights or remedies under or respecting this Promissory Note constitutes a waiver of any such rights or remedies. All rights and remedies of the City under this Promissory Note are cumulative with and in addition to all other legal and equitable rights and remedies which the City may have. This Promissory inures to the benefit of the City and its successors and assigns. Date: July 20, 2000 Moorpark Boys and Girls Club By: w --A 1N` W. Scott Mosher, Executive Director By: ,e Michael H. Wesner, President 00C 133