Title
Resolution authorizing the Execution and Delivery by the County of Lake, Illinois of a First Amendment to Regulatory Agreement and Restrictive Covenants, a HUD Amendment to Regulatory Agreement and Restrictive Covenants and a Performance Security Agreement Relating to the Regulatory Agreement and Restrictive Covenants entered into by the County at the time of issuance of its Variable Rate Demand Multifamily Housing Revenue Bonds (Whispering Oaks Apartments Project) Series 2008; and Other Provisions in Connection Therewith.
Staff Summary
• In 2008, the County issued $26,000,000 in conduit bonds for the purpose of loaning the funds to Whispering Oaks Associates, L.P., which used the funds for the acquisition, rehabilitation and equipping of the Whispering Oaks Apartment in Waukegan to provide affordable housing, governed by Restrictive Covenants to assure compliance with federal affordable housing standards.
• The bonds were supported by a credit facility from Freddie Mac, which imposed special conditions on the Restrictive Covenants.
• The owner has arranged to refinance the outstanding portion of the bonds with a new loan insured by the U.S. Department of Housing and Urban Development (HUD) and HUD requires certain different special conditions on the Restrictive Covenants.
• The resolution approves amendments to the Restrictive Covenants to (1) remove the special conditions of Freddie Mac and (2) add the special conditions required by HUD, as well as approves a new Performance Security Agreement to cover County out-of-packet costs in the event of non-compliance by the owner of the Restrictive Covenants.
Body
RESOLUTION
WHEREAS, The County of Lake, Illinois (“Issuer”), is a duly organized and existing unit of local government within the meaning of Section 1 of Article VII of the 1970 Constitution of the State of Illinois and is a body politic and corporate operating under the general laws of the State of Illinois and is not a home rule unit of local government; and
WHEREAS, the Issuer is authorized under the Industrial Building Revenue Bond Act, 50 ILCS 445/1 et seq. (“Bond Act”), to issue its revenue bonds to finance, in whole or in part, the cost of the construction, rebuilding, acquisition, improvement, or extension of an “industrial project,” as defined in Section 2 of the Bond Act; and
WHEREAS, the Issuer previously issued its Variable Rate Demand Multifamily Housing Revenue Bonds (Whispering Oaks Apartments Project) Series 2008, in an aggregate principal amount of $26,000,000 (“Bonds”) and loaned the proceeds thereof to Whispering Oaks Associates, L.P., an Illinois limited partnership (“Borrower”), in order to finance the costs of the acquisition, rehabilitation and equipping of a multifamily rental housing facility, located in the City of Waukegan of The County of Lake, Illinois (“Project”); and
WHEREAS, in connection with the issuance of the Bonds, the Borrower, the Issuer and The Bank of New York Mellon Trust Company, as trustee (“Trustee”) entered into a Regulatory Agreement and Declaration of Restrictive Covenants, dated as of November 1, 2008 (“Restrictive Covenants”), governing the Borrower’s use of the Project; and
WHEREAS, the Borrower intends to refinance the loan of the proceeds of the Bonds through a loan from the United States Department of Housing and Urban Development (“HUD”), and HUD requires certain modifications in connection with the Restrictive Covenants as part of the issuance of the mortgage loan for the Project; and
WHEREAS, the Bonds were subject to a credit facility with Freddie Mac, and the conditions on the Restrictive Covenants required by Freddie Mac will no longer be required upon payment in full of the Bonds by the Borrower; and
WHEREAS, the Bonds will be redeemed in full and the outstanding amounts paid in full as part of the refinancing of the Project by the Borrower; and
WHEREAS, following the payment in full of the Bonds, the Project will continue to be subject to the Restrictive Covenants and the Borrower will be required to continue to perform the duties and obligations of the Borrower under the Restrictive Covenants; and
WHEREAS, the Borrower and the County will enter into the First Amendment to Restrictive Covenants (“First Amendment”) and the HUD Amendment to Restrictive Covenants (“HUD Amendment”) to reflect the new financing arrangements and enable the Borrower to continue to comply with the Restrictive Covenants as they will be amended; and
WHEREAS, the Purchaser and the County will enter into a Performance Security Agreement (“PSA”) to ensure the Purchaser’s performance of its obligations under the Restrictive Covenants as they will be amended; and
WHEREAS, there has been presented to the County Board of The County of Lake, Illinois (the “County Board”) at this meeting, the proposed form of the First Amendment, the HUD Amendment, and the PSA; and
WHEREAS, the County Board finds the form and substance of the Assignment and the PSA to be satisfactory and proper and hereby determines to proceed with the execution and delivery of the First Amendment, the HUD Amendment, and the PSA and the taking of such other actions as may be necessary and appropriate in connection therewith.
NOW, THEREFORE, BE IT RESOLVED, BY THE COUNTY BOARD OF THE COUNTY OF LAKE, ILLINOIS, THAT:
SECTION 1: The foregoing recitals are hereby incorporated in this Resolution as if fully set forth herein.
SECTION 2: The First Amendment to Restrictive Covenants and the HUD Amendment to Restrictive Covenants (collectively, “Amendments”) are each hereby approved in substantially the form and substance presented to the County Board and on file with the County Clerk of the Issuer with such changes or additions thereto as may be required or approved by counsel to the Issuer and approved by the officers of the Issuer executing and attesting the same, as evidenced by their execution and delivery thereof and the Chair or Vice Chair of the County Board is authorized and directed, for and on behalf of the Issuer, to execute and the County Clerk of the Issuer is hereby authorized to attest the Amendments on behalf of the Issuer, and such officers are hereby authorized to deliver the Amendments. Upon execution by the parties thereto and delivery thereof, the Amendments shall be binding upon the Issuer in accordance with the terms and provisions thereof.
SECTION 3: The PSA is hereby approved in substantially the form and substance presented to the County Board and on file with the County Clerk of the Issuer with such changes or additions thereto as may be required or approved by counsel to the Issuer and approved by the officers of the Issuer executing and attesting the same, as evidenced by their execution and delivery thereof and the Chair or Vice Chair of the County Board is authorized and directed, for and on behalf of the Issuer, to execute and the County Clerk of the Issuer is hereby authorized to attest the PSA on behalf of the Issuer, and such officers are hereby authorized to deliver the PSA. Upon execution by the parties thereto and delivery thereof, the PSA shall be binding upon the Issuer in accordance with the terms and provisions thereof.
SECTION 4: No pledge, agreement, covenant, representation, obligation or undertaking by the Issuer contained in this Resolution and no other pledge, agreement, covenant, representation, obligation or undertaking by the Issuer contained in any other document executed by the Issuer in connection with the Project or the Bonds shall give rise to any pecuniary liability of the Issuer or charge against its general credit, or shall obligate the Issuer financially in any way. No failure of the Issuer to comply with any term, condition, covenant, obligation or agreement herein or therein shall subject the Issuer to liability for any claim for damages, costs, or other financial or pecuniary charge except to the extent the same is paid by the Purchaser; and no execution of any claim, demand, cause of action or judgment shall be levied upon or collected from the general credit, general funds or other property of the Issuer.
SECTION 5: The Borrower agrees to pay to the Issuer, immediately upon presentation of a written demand or demands therefor, all legal and other consulting and administrative fees, costs, and expenses incurred or accrued in connection with the negotiation, preparation, consideration, and review of this Resolution and the performance by the Issuer of its obligations under this Resolution, and all fees, costs, and expenses that the Issuer may incur at the request of the Borrower or as a result of or arising out of this Resolution or in connection with the execution and delivery of the Assignment.
SECTION 6: The provisions of this Resolution are hereby declared to be separable and if any section, phrase or provision shall for any reason be declared to be invalid, such declaration shall not affect the validity of the remainder of the sections, phrases and provisions; provided, however, that no holding of invalidity shall impose any personal liability on any director, member, elected or appointed officer, official, employee, attorney, or agent of the Issuer.
DATED at Waukegan, Illinois, on October 13, 2026.