AGENDA MEMO

City Council

February 16, 2010

ISSUE STATEMENT

A resolution authorizing the Mayor, City Clerk and Treasurer to sign a Governmental Certificate, Business Loan Agreement and Compliance Agreement to open a line of credit with Republic Bank. RESOLUTION

BACKGROUND/HISTORY

The City of Darien accepted a proposal from Republic Bank to provide banking services. At the time one of the items discussed was a line of credit the City could draw upon in case of emergency or cash flow deficiencies. At this time staff recommends entering into an agreement with Republic Bank to open the line of credit in the amount of $1,250,000.00. The City is not using the money at this time; it is only keeping the option of borrowing the funds at a future date. The intention is to use the line of credit in an emergency or if needed for cash flow.

The included documents are the Governmental Certificate, Business Loan Agreement and the Compliance Agreement. These documents make the credit line available to the City of Darien. In the event the City of Darien requires the funds, a Promissory Note, Business Loan Affidavit, Disbursement Request and Notice of Final Agreement must also be executed by the Mayor, City Clerk and Treasurer. These documents contain the interest rate, which for this loan is the Republic Bank Prime Rate, which currently stands at 3.25%.

STAFF/COMMITTEE RECOMMENDATION

The Administrative/Finance Committee recommends approving the resolution

ALTERNATE CONSIDERATION

Not approving the resolution would be an alternate consideration.

DECISION MODE

This item will be on the February 16, 2010 City Council agenda for formal approval.