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89-1237 W1i1T6� - C�TV CLERK PINK - FINANCE CITY OF S NT PAUL . Council CANARV - OEPARTMEN T BLUE - MAVOR File NO. � � - ouncil solution � 5 Presented By Referred To Committee: Date Out of Committee By Date RESOLUTION RECIT N A PROPOSAL FOR REFINANCING TWO L I-FAMILY RENTAL HOUSING DEVELOP E S THROUGH THE _ ISSUANCE OF REFUNDI G ONDS, AUTHORIZING THE PREPARATION OF N C SARY DOCUMENTS AND MATERIALS IN CONN CT ON WITH THE SAID DEVELOPMEN S ND BONDS ( 900 COMO LAKE N HIGHLAND PARK RETIREMENT RES D CE PROJECTS) WHEREAS, (a) Minnesota t utes, Chapter 462C (the "Act) confers u o cities, or housing and redevelopment au h ities or port authorities authoriz d y ordiance to exercise on behalf o city the powers conferred by the Act e power to issue revenue bonds to fin n a program for the purposes of planning ministering, making or purchasing loans wit spect to one or more multi-family housing d elopments within the boundaries of the ci y; COUNCIL MEMBERS Requested by Department of: Yeas Nays ' , Dimond ( i.ong �-' In Favor Goswitz s�ch;`�� Against BY - ��� Sonnen Wilson Form Approved by City Attorne Adopted by Council: Date Certified Passed by Council Secretary � �y � By Approved by �Vlavor: Date _ Appr d by Mayor for S 's ion t ouncil By By . � . ��,�..�7 OEPARTMENTlOFFI�JCOUNqL � DATE INITIATED P.E.o. Housing 6/27/89 REEN SHEET No. 3��T�0,� CONTACT PERSON d PHONE � DE ENT OIRECTOR �GTY COUNGL Gary Peltier Ext. 3351 ��� ATTORNEY ¢ �9 9�cmcx�nc MUBT BE ON OOUNqL A(iENDA BY(DAT� ROU7INO BU ET DIRECTOR �FlN.8 MOT.SERVICES DIR. 7/11/8 9 MA OR(OR ASSIST � TOTAL N OF SIGNATURE PAGES 2 (CLIP ALL L TIO 8 FOR SIGNATUR� ACTION REQUE8TED: Execution of attached City Council re 1 tion providing preliminary .approval of refunding bonds , and authorizing H o provide final approval . f�COMMENDATIONS:Approve(IU a R�Jsct(i� COUNCIL C�A TT RCH REPORT OPTIONAL ANALYST PHONE NO. _PLANNINO COMMISSION _CIVIL 8ERVi(:E COMMIS810N CIB COMMITTEE _ �STAFF _ COMMENT3: _D�TRICT COURT _ SUPPORTS WHICH COUNCIL OBJECTIVE4 INITIATIN(i PROBLEM,ISSUE,OPPORTUNITV(1Nho,Whe�Whsn,Whsre,Why): HRA issued tax exempt bonds in 1984 or the Highland Park Retirement Center (aka The Wellington) and the 900 Com L ke rental housing elderly projects; neither project has worked well fina ci lly. It is currently proposed to refund the original bonds to arrive at a lower interest rate and put the projects on sound footing. ADVANTAOE8 IF MPROVED: The two projects can operate in a fi a ially better position and prevent a default on each of the projects . e lopers will pay HRA and City out- of-pocket expenses for the refunding nd continue the payment of the annual fees to HRA. DI8/1DVANTAOEB IF APPROVED: None apparent DISADVANTAOE8 IF NOT APPROVED: Potential default of the two projec s . To AMOUNT OF TRANSACTION s 11,7 0 0 ,0 0 0 CpgT/REVENUE BUDQETED(CIRq.E OI�1� YES No �/A FUNDING80URCE Refundin bond roceeds ACTIViTYNUM9ER N/A FlNANCIAL INFORMATION:(EXPWN) � �� . , � . ��/.?37 � (b) The Housi g nd Redevelopment Authority of the Ci y f Saint Paul, Minnesota (the "HRA" ) has bee signated, by ordinance, to exercise, on beh 1 of the City of St. Paul, Minnesota (th " ity" ) the powers conferred by Minnes t 5tatutes, Section 462C. 01 to 462C. b8 t "Act" ) ; (c) By Resolu i No. 84-1287, the City Council of the City of Saint Paul authorized . � the HRA to issue it using Development Revenue Bonds pursu n to the Act to finance two projects, one o n by 900 Como Lake Limited Partnership ( e "Como Project" ) and the other ownetl by i land Park Retirement Residence Limited P r ership (the "Highland Project" ) (each of a' partnerships being referred to in this r olution as a "Developer" ) ; (d) The HRA i s d its $12, 065, 000 Housing Development R enue Bonds (FHA-Insured Mortgage Loans) Ser es 1984 (the "Prior Bonds" ) pursuant to a rust Indenture dated as of October 1, 1984 t "Original Indenture" ) between the HRA and No west Bank Minnesota, National Associatio ( formerly, Norwest Bank Minneapolis, Nation 1 ssociation) as trustee; (e) The proce ds of the Prior Bonds have been utilized, in p rt, to acquire FHA-insured mortgage loans made to finance the Como Project and the Hig l d Project, respec- tively, and the pro ee s of the Prior Bonds were used in part t f nd reserve funds and to pay the costs of au ho ization, issuance and delivery of the Pri r onds; ( f) The owner o the Como Project and the Highland Projec ve now proposed to the , HRA that it should ss e its refunding bonds (the "Rsfunding Bon s" ) to refinance and refund the Prior Bo ds, and that the Refunding Bonds should be iss ed in two series, one for each project, pursu nt to separate indentures of trust; 2 ,c,u� � � . . . ���/•�3 7 (g) The owne s of the Como Project and Highland Project h v retained Dougherty, Dawkins, Strand & o t Incorporated ( "Dougherty Dawkin " ) to act as underwriters and investment ban e s for the Refunding Bonds; • (h) The owne s f the Como Project and the Highland Proje t, and Dougherty Dawkins, have proposed term d conditions for the . � . Refunding Bonds wh c require the City to publish a notice d sc ibing the proposal to issue refunding bo ds, and to hold a public hearing thereon; a d public hearing on said refunding bonds wa ld on July 11, 1989, after notice was p bl ' shed, as required by Minnesota Statutes a federal income tax law, at which public he ri g all those appearing who desired to spe k ere heard; (i) The Minn so a Housing Finance Agency approved the finan in program for the Projects prior to he issuance of the Prior Bonds, and Minneso a tatutes, Chapter 462C does not require t at a new financing program be submitted to or ap roved by the Minnesota Housing Finance Ag nc in connection with the issuance of refund ng bonds; � ( j ) No publi o ficial of the City has either a direct or 'in irect financial interest in the Projects, t e rior Bonds or the Re- funding Bonds, nor wi 1 any public official either directly or in irectly benefit finan- cially from the Pr je ts, the Prior Bonds or the Refunding Bond . NOW THEREFORE, BE IT RE OL ED by the City Council of the City of Saint Paul, Minriesot , s follows: �- 1 . The City hereb p eliminarily approves the proposal of the Developers t at the HRA issue refunding bonds (the "Refunding Bonds" ) to p y 11 of the outstanding principal of and accrued int re t on the Prior Bonds through their date of redemption (wh'ch date shall be no later than 90 days following the date of i su nce of the Refundinq Bonds) pursuant to a financing agre me t between the HRA and each of ,..�� � � . . . 1��9-/�z3Z the Developers relating to t e ssuance and sale of the Refunding Bonds in a total p in ipal amount not to exceed the outstanding principal amount an accreted value of the Prior Bonds (approximately $5,350, 00 with respect to the Como Project and approximately $6, 35 , 000 with respect to the Highland Project) , which Ref nd ng Bonds shall be issued pursuant to the Act to refin nc the Projects; and the • financing agreements may pro id for the entire interest of the Developers to be mortgag d or the benefit of the purchasers of the Refunding on s, or a trustee for the . owner(s) of the Refunding Bo ds and the City, acting by and through the HRA, hereby unde ta es preliminarily to issue its Refunding Bonds in accordanc w th such terms and conditions; 2 . The Refunding on s will be structured to be issued in two series, one fo e ch project, pursuant to a separate indenture of trust or each, and will be structured to utilize mortgage insuranc p ovided by the Federal Housing Administration. 3 . On the basis o i formation available to the City it appears, and the Cit h reby finds: that the Projects constitute multi-family hous 'ng developments within the meaning of subdivision 5 of ec ion 462C.02 of the Act and are multi-family developments de ig ed primarily for occupancy by elderly persons within the m an ng of subdivision 4 of Section 462C.05 of the Act; that the Pr jects are primarily occupied by persons of low income and by elderly persons; the avail- ability of the financing und r he Act and the willingness of ` the City to furnish such fin nc ng has been a substantial inducement to the Developers to undertake the Projects, and that the effect of the Proje ts has been to provide additional multi-family rental housing pp rtunities to residents of the City, to assist in the redev lo ment of blighted and marginal land and to promote more int ns ve development and use of land within the City; and that th r financing of the Projects through the issuance of the ef nding Bonds by the HRA will substantially improve the fi an ial viability of. the Projects so as to enable their contin ed operation as decent, safe and sanitary housing for persons of low income and elderly persons; 4 . The proposal t at the HRA refinance the Projects by the issuance of revenue r fu ding bonds, is hereby given preliminary approval by the it , subject to final approval by the HRA, the Developers and he purchasers of the Refunding Bonds as to ultimate details f the refinancing; ,�� • . , ��I`-/.?�7 5 . Pursuant to Cha t r 72, Saint Paul, Minnesota, Administrative Code, the Cit h reby authorizes and directs The Housing and Redevelopment A thority of the City of Saint Paul, Minnesota (the "HRA" ) t ssue the housing revenue refunding bonds to refinance h Projects and to take all actions necessary or desirabi n connection therewith, and no further approval or authoriza i n of the City shall be • required; 6 . The Developers a e agreed and it is hereby � determined that any and all c s s incurred by the City or HRA in connection with the refina c ng of the Projects whether or not the Refunding Bonds are i' s ed will be paid by the Developers; 7 . Briggs and Mor n Professional Association, and : Dougherty Dawkins, acting as 'n estment bankers, are author- ized to assist in the prepara i n and review of necessary documents relating to the ref ' n ncing of the Projects and the issuance of the Refunding Bon s to consult with the City Attorney, Developers and purc a ers of the Refunding Bonds (or trustee for the purchasers of t e Refunding Bonds) as to the maturities, interest rates an ther terms and provisions of the Refunding Bonds and as to t e covenants and other provi- sions of the necessary docume t and submit such documents to the HRA for final approval; 8 . Nothing in this R solution or the documents prepared pursuant hereto shal uthorize the expenditure of � any municipal funds on the Pr j cts other than the revenues derived from the Projects or t erwise granted to the City or HRA for this purpose. The Re u ding Bonds shall not consti- tute a charge, lien or encumb' a ce, legal or equitable, upon any property or funds of the i y or HRA except the revenue and proceeds pledged to the a ent thereof, nor shall the City or HRA be subject to any 1 ability thereon. The holders of the Refunding Bonds shall e er have the right to compel any exercise of the taxing po e of the City or HRA to pay the outstanding principal on the e unding Bonds or the interest thereon, or to enforce paymen hereon against any property of � the City or HRA. The Refundi g Bonds shall recite in substance that the Refunding o ds, incl.uding *he interest thereon, are payable solely f o the revenues and proceeds pledged to the payment thereo . The Refunding Bonds shall not constitute a debt of the City o HRA within the meaning of any constitutional or statutory 1 'm'tation of indebtedness . 5 �� WHITEs — CITV CLERK PINK — FINANCE GITY OF A NT PAUL Council I�I�/� CANARV — DEPARTMENT �+�//7i BLIYE — MAVOR File NO. ��� — � � Council solution Presented By Referred To Committee: Date Out of Committee By Date 9 . In anticipation of t e issuance of the Refunding Bonds to refinance the Projects, a d in order that the completion of the refinancing wi 1 not be unduly delayed when approved, the Developers ar ereby authorized to: negotiate with a corporate fiduc'a y to act as trustee for the Refunding Bonds; to nego i te with an appropriate mortgage banker to act as servic r for the FHA-insured mortgage loans securing each ser' e of Refunding Bonds, and in that connection to replac' he mortgage banker currently acting as servicer for the FHA-i s red mortgage loans securing the Prior Bonds; to negotiate wi h the Federal Housing Administration for insurance of econd mortgage loan which will secure the Refunding o ds (provided that such second mortgage loan shall not h v the effect of increasing the principal amount of Refundin onds over the figure stated in paragraph 1 hereof ) . o e of such actions shall give rise to any pecuniary or ot e liability on the part of the City or HRA. 10 . Except to the ex n any earlier resolutions of the City or the Authority wi espect to the Projects and the financing therefor may nconsistent with this resolution, this resolution sha 1 ot be construed to amend, repeal or vitiate such earlier s lutions. Adopted by the City C n il of the City of Saint Paul, Minnesota this llth day of J ly, 1989 . COUNCIL MEMBERS Requested by Department of: Yeas Nays Dimond Lona [n Favor coswitz �l'`'�'� ,�----- s�ne n�� � _ Against By � Sonnen .i�15lse�r JUL 1 1 t989 Form Approved by City Attorney Adopted by Council: Date � Certified Pass Council S tar � � °�g� sy + t�pp o by INavor: Date � , 2 �9 Appr e b Mayor for Submi 'on �o Council By By pUBUSlEA J U L 2 2 1989 , ��i�.�� .. • • ..y , . ,.� � l J � � , CITY OF AI T PAUL � INTERDEPARTME A MEMORANDUM RfCEIVED DATE: June 23, 1989 �uN 2�1989 CITY CLERK T0: A1 Olson FROM: Sheri Pemberton� RE: CITY COUNCIL PUBLIC HEARIN F R JULY 11, 1989 Attached is a copy of the Public Heari g otice which will be published in the St. Paul Legal Ledger and the St. Pau1 Di patch Pioneer Press on Saturday, June 24, 1989. Please place this public Hearing on th C ty Council Agenda for Tuesday, July 11, 1989. A City Council Resolution w 11 be forwarded to you by the City Attorney's Office prior to the City Co nc 1 meeting. Thank you. cc: Jim Hart Gary Peltier � .� . (,� �q-�o?3� ., 520X - NOTICE OF PU LIC HEARING ON A PROPOSAL TO IS UE BONDS TO REFUND THE HOUSING DEVE 0 MENT REVENUE BONDS (FHA-INSURED MORTG G LOANS) SERIES 1984 ORIGINALLY ISSUED BY T E OUSING AND REDEVELOPMENT • AUTHORITY OF TfiE CIT 0 SAINT PAUL, MINNESOTA Notice is hereby given ha the City Council of the City of Saint Paul, Mi�inesota, wi 1 eet in the City Council chambers of the City Hall in th City of Saint Paul, Minnesota at 9 : 00 o 'clock A.M. on July ll, 1989 to consider the proposal of 900 Como Lake Limited Par ne ship, a Minnesota limited partnership, and Highland Pa k etirement Residence Limited Partnership, a Minnesota lim te partnership (the "Developers " ) that the City pp ove the issuance of Refunding Bonds by the Housing and Red ve opment Authority of the City of Saint Paul, Minnesota (th " RA" ) to refund $12 , 065, 000 Housing Development Revenue on s (FHA-Insured Mortgage Loans) Series 1984 (the "Prior Bond " ) originally issued by the HRA on October ].7 , 1984 . Under the proposal, the H , on belialf of the City of St. Paul, will issue housing r.e enue refunding bonds (the "Refunding Bonds " ) to refund th Prior Bonds and to refinance the projects originally fina ce through the Prior Bonds . The Refunding Bonds will be issu d ' n two separate series , one for each project, pursuant to se ar te indentures of trust, in an aggregate principal amount n t o exceed the outstanding principal amount and accrete v lue of the Prior Bonds . Approximately $5, 350, 000 of he Refunding Bonds will be issued for the project owned by the 90 Como Lake Limited Partnersh5.p, and approximate y 6 , 350, 000 of the Refunding Bonds will be issued for the pr ject owned by the Highland Park Retirement Residence Li it d Partnership. Said Refunding Bonds, a a d when issued, will not constitute a charge, lien or er. umbrance upon any property of the City of Saint Paul or th H , except the multifamily rental housing projects refi an ed thereby and the revenues to be derived from such project ( ' ncluding insurance provided by the Federal Housing Administ at 'on) and other revenues specifically pledyed thereto uch Refunding Bonds will not be a charge against the City s eneral credit or taxing powers but will be payable solely f o sums to be paid by the owners of each of the projects purs an to revenue agreements . � - - � C�F��-�aa? .� � . - Further information conc �r ing the projects and the refinancirig thereof may be o a ned from the Housing Division, Department of Planning and Ec n mic Development, City Hall Annex - 12th Floor, 25 West F u th Street, St. Paul, Minnesota 55102 (Telephone: 228-3200) . • At the time and place fi e for the public hearing, the City Council of the City of S i t Paul wiil give all persons who appear at the hearing an p ortunity to express their . views with respect to the ref'' n ncing proposal . Dated this 24th day of J n , 1989 . (BY R ER OF THE CITY COUNCIL OF THE CITY 0 SAINT PAUL, MINNESOTA) By B RT B. OLSON Ci y Clerk