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S.J.R. 11
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RESOLUTION ADDRESSING OLYMPIC
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FINANCING
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2000 GENERAL SESSION
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STATE OF UTAH
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Sponsor: L. Alma Mansell
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A JOINT RESOLUTION OF THE LEGISLATURE AUTHORIZING TIME LIMITED
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DEFERRAL OF CERTAIN MONIES OWED FOR THE PURCHASE AND SALE OF THE
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UTAH WINTER SPORTS PARK; AND ADDRESSING FINANCIAL ISSUES RELATING TO
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THE SALT LAKE OLYMPIC ORGANIZING COMMITTEE FOR THE OLYMPIC WINTER
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GAMES OF 2002, AND TO THE PURCHASE AND SALE OF THE UTAH WINTER SPORTS
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PARK.
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Be it resolved by the Legislature of the state of Utah:
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WHEREAS, as used in this resolution:
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(1) "credit agreement" means the credit agreement between the organizing committee and
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the lending institution, as defined in S.J.R. 14 (1998 General Session);
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(2) "lending institution" means the institution or institutions that have provided and that
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provide or will provide the organizing committee with one or more revolving or other lines of
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credit;
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(3) "LLC" means "SLOC, LLC, a Delaware Limited Liability Company", formed by the
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organizing committee pursuant to the credit agreement;
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(4) "NBC television revenue" means NBC television revenues assigned by the organizing
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committee to the LLC in the approximate amount of $228,900,000, to be paid to the LLC on
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February 24, 2002, and March 6, 2002;
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(5) "Olympics" means the Olympic Winter Games of 2002;
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(6) "Olympic special revenue fund" means the fund established pursuant to Section
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59-12-103
(4);
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(7) "organizing committee" means the Salt Lake Olympic Organizing Committee for the
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Olympic Winter Games of 2002;
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(8) "organizing committee revenues" means all revenues that have been or may be received
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by the organizing committee or any of its wholly owned subsidiaries, including revenues received
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from any contract into which the committee has entered or may enter, and proceeds payable under
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insurance contracts;
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(9) "State Olympic Officer" means the individual appointed pursuant to Section
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63A-10-103
;
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(10) "Utah Athletic Foundation" means the private nonprofit entity created in accordance
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with S.J.R. 17 (1994 General Session); and
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(11) "Utah Sports Authority" means the agency created pursuant to Title 63A, Chapter 7;
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WHEREAS, the organizing committee has pledged to the state that expenses of the
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Olympics will not exceed organizing committee revenues;
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WHEREAS, the organizing committee is requesting the state to defer $58,000,000 of the
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$99,000,000 purchase price of the Utah Winter Sports Park from January 10, 2002 to March 7,
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2002, in order to address concerns and requirements of the lending institution;
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WHEREAS, the organizing committee has proposed that if future, additional cash flow
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concerns that meet the requirements and conditions subsequently described in this resolution
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occur, and are documented in accordance with the specific requirements of this resolution, up to
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$20,000,000 of the $99,000,000 purchase price for the Utah Winter Sports Park which is owed to
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the Utah Athletic Foundation, be deferred from March 7, 2002, for a period not to exceed one year;
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WHEREAS, the state has a security interest in all organizing committee revenues;
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WHEREAS, the security interest held by the state in organizing committee revenues:
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(1) is second in priority only to the lending institution;
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(2) secures:
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(a) the $100,000,000 purchase price of the Utah Winter Sports Park; and
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(b) an amount equal to the bond obligations owed with respect to the State Building
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Ownership Authority bond, in accordance with its terms, and as described in S.J.R. 14 (1998
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General Session); and
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(3) immediately becomes a first priority security interest in all organizing committee
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revenue upon satisfaction of the terms and conditions of the existing credit agreement or
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agreements with the lending institution, and release by the lending institution in accordance with
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the terms of that agreement or agreements;
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WHEREAS, the Utah Sports Authority is an agency of the state and therefore, as
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previously established by joint resolutions of the Legislature, any security interest or right to
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payment from the organizing committee held by the Utah Sports Authority is held by the state in
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organizing committee revenues;
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WHEREAS, S.J.R. 17 (1994 General Session) governs the sale of the Utah Winter Sports
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Park and payment of the purchase price of up to $99,000,000, depending on the actual total funds
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expended or incurred by the Utah Sports Authority, through the closing date referred to in the
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purchase agreement and thereafter extended by the parties to July 14, 1999, except to the extent
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that a specific requirement of S.J.R. 17 is expressly superseded by a subsequent joint resolution
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of the Legislature;
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WHEREAS, on August 1, 1994 the Utah Sports Authority entered into an agreement to sell
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the Utah Winter Sports Park to the organizing committee for a purchase price of up to $99,000,000
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which was affirmed by S.J.R. 5 (1996 General Session);
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WHEREAS, on July 14, 1999 the Utah Winter Sports Park purchase agreement closing
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documents were executed and title to the Utah Winter Sports Park was transferred from the Utah
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Sports Authority to the organizing committee, subject to certain restrictive covenants and
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reversionary interests cited in the purchase agreement, closing documents, and joint resolutions
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of the Legislature;
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WHEREAS, according to joint resolutions of the Legislature, the Utah Winter Sports Park
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purchase agreement, and subsequent final sales agreements:
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(1) $1,000,000 was paid, a portion of which was value in kind, to the Utah Sports
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Authority at the July 14, 1999 closing date;
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(2) $58,000,000 of the purchase price is to be paid by the organizing committee into the
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Olympic Special Revenue Fund on January 10, 2002 for repayment to state and local governments
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as provided in the purchase agreement, joint resolutions of the Legislature, and in statute; and
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(3) $40,000,000 is to be paid by the organizing committee to the Utah Athletic Foundation
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on or before March 7, 2002;
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WHEREAS, the organizing committee required and received a revolving line of credit
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from the lending institution to pay for costs incurred in preparing for and hosting the Olympics;
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WHEREAS, S.J.R. 11 (1997 General Session) required the Utah Sports Authority to
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execute agreements and take actions, consistent with S.J.R. 11 (1997 General Session), as was
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required by the lending institution, in order to evidence subordination and subrogation of the state's
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security interest to the security interest of the lending institution;
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WHEREAS, subsequent to the passage of S.J.R. 11 (1997 General Session), the lending
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institution has since placed restrictions on the line of credit extended to the organizing committee
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including a requirement that, in order to retain its line of credit, the organizing committee obtain
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legislative approval to defer payment of $58,000,000 owed to state and local governments, from
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January 10, 2002 to March 7, 2002;
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WHEREAS, NBC televison revenue will be first used to repay the credit or line of credit
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extended to the organizing committee by the lending institution;
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WHEREAS, according to current contractual obligations and estimates, NBC television
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revenue will exceed the amount owed by the organizing committee to the lending institution, to
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the extent that all obligations owed to the state relating to the purchase and sale of the Utah Winter
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Sports Park could be paid from the NBC television revenues:
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NOW, THEREFORE, BE IT RESOLVED that, the Legislature authorizes deferral of the
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organizing committee's payment to the state of $58,000,000 from January 10, 2002 to no later than
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March 7, 2002, only if all of the following conditions are met:
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(1) the organizing committee and the lending institution execute all necessary agreements
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providing that $58,000,000 of NBC television revenues be paid directly from the LLC to the
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Olympic Special Revenue Fund, immediately upon satisfaction of the terms and conditions of the
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credit agreement, and providing that the $58,000,000 be paid no later than March 7, 2002;
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(2) the organizing committee and the lending institution execute all necessary agreements
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establishing that, immediately after the $58,000,000 payment described in Subsection (1), the next
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$40,000,000 of NBC television revenue be paid by the LLC directly to the Utah Athletic
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Foundation no later than March 7, 2002, unless the specific conditions and exceptions
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subsequently defined in this resolution, relating to potential deferral of up to $20,000,000 of those
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funds, have been met;
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(3) the organizing committee and the lending institution execute all necessary agreements
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providing that, other than monies owed to the lending institution, there will be no disbursement
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of or agreements incurring obligations, pledges, or requiring payments that affect NBC television
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revenues held by the LLC until after the amount of $58,000,000 has been paid to the Olympic
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Special Revenue Account, and an amount up to $40,000,000 has been paid to the Utah Athletic
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Foundation in accordance with the specific requirements and provisions of this resolution; and
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(4) the organizing committee documents and certifies that the state's security position is
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in no way affected or altered by the deferrals contemplated by this resolution, and that the
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organizing committee and the Utah Sports Authority have executed or provided for the execution
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of any and all documentation necessary to maintain the state's security interest and its priority
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position as a secured creditor, as previously described in this resolution and in previous joint
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resolutions of the Legislature;
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(5) the organizing committee and the Utah Sports Authority execute all necessary
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agreements providing for interest to be paid to the state on the $58,000,000 at a rate of no less than
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7% per annum, to be deposited monthly into the Olympic Special Revenue Fund, beginning
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January 10, 2002;
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(6) by no later than March 31, 2000, the organizing committee provides the State Olympic
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Officer and the attorney general's office with documentation that the organizing committee, the
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lending institution, and the Utah Sports Authority have complied with the requirements and
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provisions described in Subsections (1), (2), (3), (4), and (5); and
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(7) by no later than April 7, 2000, the State Olympic officer and the attorney general's
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office notify the President of the Senate and the Speaker of the House that the requirements and
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provisions described in Subsections (1), (2), (3), (4), and (5) have been complied with, and
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provide the President and the Speaker with any requested documentation.
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BE IT FURTHER RESOLVED that if the foregoing conditions are not met, there is no
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legislative approval for deferral of the $58,000,000 payment for the Utah Winter Sports Park.
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BE IT FURTHER RESOLVED that, if the organizing committee meets the following
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criteria and provides the described documentation and evidence regarding its revenue projections
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and potential cash flow concerns, as specified in this resolution, the governor may at a future date
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agree to a deferral of up to $20,000,000 of the $40,000,000 owed to the Utah Athletic Foundation
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for a period not to exceed one year from the agreed date of payment, if:
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(1) by no later than December 31, 2001, the organizing committee provides the governor
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and the State Olympic Officer with:
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(a) analysis and supporting documentation evidencing that the organizing committee's
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revenues, revenue projections, expenses, cash flow, and contingency funds demonstrate, to the
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satisfaction of the governor and the State Olympic Officer, that the organizing committee's cash
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flow will require deferral of some portion of the $40,000,000 owed to the Utah Athletic
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Foundation, which portion may not exceed $20,000,000; and
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(b) the specific amount of the requested deferral; and
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(c) the specified dates for the delayed payments in accordance with Subsection (3) and
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with other specific requirements and limitations of this resolution;
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(2) by no later than January 10, 2002, the State Olympic Officer reviews the organizing
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committee's proposal for deferral and provides to the governor his written determination regarding
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whether the specific terms and conditions of this resolution have been complied with, and whether
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the deferral, not to exceed $20,000,000, is in the best interest of the taxpayers and citizens of this
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state;
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(3) by no later than January 20, 2002, the governor shall review the information provided
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to him by the State Olympic Officer, pursuant to Subsection (2), and, based on that information
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and any other information that he has requested or that has been provided to him, the governor
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shall, in writing, determine whether the specific terms and conditions of this resolution have been
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complied with and whether the deferral, not to exceed $20,000,000 is in the best interest of the
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taxpayers and the citizens of this state;
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(4) (a) any deferred amount of principal is paid in no more than four equal, quarterly
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payments;
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(b) with regard to any deferred amount of principal, interest is paid to the Utah Athletic
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Foundation monthly, at the rate of no less than 7% per annum; and
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(c) any other consideration agreed to by the organizing committee and the Utah Athletic
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Foundation is paid, so long as the Utah Athletic Foundation remains in a position substantially
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equivalent to its position prior to any deferral of monies owed to the Utah Athletic Foundation;
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(5) the deferral does not affect the state's security interest or position, or the organizing
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committee's obligations to the state or the Utah Athletic Foundation; and
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(6) any portion not deferred is paid, in accordance with the terms of this resolution, from
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NBC television revenues held by the LLC.
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BE IT FURTHER RESOLVED that, without the specific written approval of the governor,
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in accordance with the terms of this resolution, there shall be no deferral of any portion of the
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$40,000,000 owed by the organizing committee to the Utah Athletic Foundation; and that no other
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person may approve that deferral on behalf of the governor.
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BE IT FURTHER RESOLVED that, regardless of whether NBC television revenues held
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or maintained by the LLC are or will be sufficient to fully meet the organizing committee's
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obligations to pay $58,000,000 to the state and $40,000,000 to the Utah Athletic Foundation in
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relation to the purchase and sale of the Utah Winter Sports Park, nothing in this resolution, or in
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any agreement or document executed pursuant to this resolution, shall be interpreted to affect,
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modify, or alter the organizing committee's debt, and its agreement to fully pay those obligations
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to the state and to the Utah Athletic Foundation from any and all organizing committee revenue,
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on the dates provided by the purchase and sales agreements for the Utah Winter Sports Park,
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except as expressly modified by this resolution, upon compliance with the terms and conditions
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of deferral described in this resolution, or by previous joint resolutions of the Legislature.
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BE IT FURTHER RESOLVED that the Legislature hereby reaffirms S.J.R. 17 (1994
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General Session), S.J.R. 5 (1996 General Session), S.J.R. 11 (1997 General Session), and S.J.R.
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14 (1998 General Session), except as expressly modified by this resolution.
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BE IT FURTHER RESOLVED that nothing in this resolution modifies or affects the state's
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security interest or its position as a secured creditor with regard to organizing committee revenues.
Legislative Review Note
as of 2-7-00 12:42 PM
A limited legal review of this legislation raises no obvious constitutional or statutory concerns.