88-1787 WHITE - GT'! CLER1�
f�NK - FINANCE GITY OF SAINT PAUL Council
C°ANARV � DEPARTMENT
BI.UE - MAVOR File NO• �_-/�� � -
. Council Resolution �
Presented By ��.�✓,l�r�� { /
Referred To Committee: Date
Out of Committee By Date
WHEREAS:
1. On October 25, 1988, the Port Authority of the City of Saint Paul adopted Resolu-
tion No. 3049 giving preliminary approval to the issuance of revenue bonds in the 1ni-
tial principal amount of $935,000 to finance the construction of a 20,950 square foot
office/production facility in Empire Buiider Industrial Park for St. Paul Stamp Works,
Inc. Miiler $ Schroeder Financial, Inc. will underwrite the 30-year revenue bond issue.
2. The Port Authority of tfi� L�ty of Saint Paul wili submit an applicatlon for an
industrial revenue bond allocation from the State of Minnesota Competltive Pool as the
proJect is industrial . The City of Saint Paul 's entitlement allocation will not be af-
fected by this application.
3. The Port Authority of the City of Saint Paul will submit an application for an
industrial revenue bond allocation from the State of Minnesota Competitive Pool as the
proJect is industrial . The City of Saint Paul 's entitlement allocation will not be af-
fected by this application.
4. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue bonds
authorized by the Port Authority of the City of Saint Paul, shall be issued only with the
consent of the City Council of the City of Saint Paul, by resolutton adopted in accordance
with law;
5. The Port Authority of the City of Saint Paul has requested that the City Counctl
give its requisite consent pursuant to said law to facilitate the issuance of said revenue
bonds by the Port Authority of the City of Saint Paul, subJect to final approval of the
details of said issue by the Port Authority of the City of Saint Paul .
COUNCIL MEMBERS Requested by partme t of:
Yeas Nays
Dimond
�o� � [n Favor �
Goswitz
Rettman
s�ne;ne� _ Against BY
Sonnen
Wilson
Form Approved by City Attorney
Adopted by Council: Date � �.
Certified Passed by Council Secretary By �
By, v�, _
Approved by Mavor: Date _ Approved by Mayor for Submission to Council
By
WHITE - CITY CLERK
ffINK - FINANCE GITY OF SAINT PAUL Council
CANAR'y► DEPARTMENT R.�
BLUE - MAVOR File NO. �t' /��
Council Resolution
Presented By
Referred To Committee: Date
Out of Committee By Date
RESOLVED, by the City Council of the City of Saint Paul, that in accordance with Laws
of Minnesota 1976, Chapter 234, the C1ty Council hereby consents to the issuance of the
aforesaid revenue bonds for the purposes described in the aforesaid Port Authority Resolu-
tion No. 3049 the exact details of which, including, but not limited to, provisions
relating to maturities, interest rates, discount, redemption, and for the issuance of ad-
ditional bonds are to be determined by the Port Authority, pursuant to resolution adopted
by the Port Authority, and the City Council hereby authorizes the issuance of any addi-
tional bonds ( including refunding bonds) by the Port Authority, found by the Port
Authority to be necessary for carrying out the purposes for which the aforesaid bonds are
issued.
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COUNCIL MEMBERS Requested by De rtm nt of:
Yeas Nays �
Dimond
�� In Favor
coswitz
� �
s�he;be� __ Against BY
Sonnen
Wilson
��`� � �' ?�`��
Form Approved by City Attorney
Adopted by Council: Date
Certified Ya-s\ ,d Council Sec r BY
B}. %'
✓ pp
Approv d Mavor: a _ ���"! � � ���JU Appr by Mayor for Sub " s' rL,to Council
B ��� I���V �� By'
St_ P�i�l Pnrt �1�ithnrit� DEPARTMENT �_ ��f 17`� 7 . N� _ �s�$
�.A. Kra � _, .l_A. Camr�obass�,,,� CONTACT
274-568[ PHONE
October 25, 198$ DATE ,,i�r� e�
�
ASSIGN NUhBER ..FOR ROUTING ORDER (Clip All locations for Sianature) :
1 Departnient Darector 3 Director of Manageme►lt/Mayor
Finance and Management Services Director � � City Clerk
_� BUdget Di r'eCtOr �,E,; ST_ PAlll STAMP W(1RKS,,, T NC_
� City Attorney $935,000 TAX EXEMPT REVENUE BOND
ISSUE
WHAT WILL BE ACHIEVED BY TAKING ACTION ON THE ATTACHED MATERIALS? (Purpase/ .
Rationale) :
The purpose of the tax exempt revenue bond issue is to finance the constructi_on of` a 20,950 squar
foot office/productian facility in Empire 9uiTder Industrial Park for St. Paul Stamp Works,
Inc.
COST/BENEFIT, BUDGETARY AND PERSONNEL IMPACTS ANTICIPATED:
The amount of the revenue bond issue is $935,000 and will be for a term of 30 years.
There will be approximately 8 new jobs created as a result of this project, and the company
has 2ntered into the City's First Source Agreement and is already proceeding wi�h the i�iring
of a new employee under this program.
The Port Authority will submit an application for an industr.ial revenue bond, aliocation from
the STate of Minnesota Competitive Pool as the project is industrial . The Gity of Saint Paul 's '
entitlement allocation wilJ not be affected by this application. �
FINANCING SOURCE AND BUDGET ACTIVITY NUNBER CHARGED OR CREDITED: (Mayor's signa-
� � ture not re-
Total Amaunt ,of "Transaction: N/A quired if under
� $10,000)
Funding Source:
Activity Number: � . ,,
ATTACHMENTS (List and Number All Attachments) :
_ ��u~c:� ������rc� Center,
1 . Staff Memorandum �
2. Draft City Council Resolution (;i;`J O1 j�$$
3. Port Authorty Resolution No. 3049
cc. J. Shoholm �
:,
. ;
DEPARTMENT REVIEW CITY A�'TQRNEY R�YIEW
X Yes No Council Resolution Required? � Resolution Requ�red? X Yes No
Yes X No Insurance Required? IASUrance Sufficie�it? X Yes No
Yes X No Insurance Attached;
� (SEE •REVERSE SIDE fOR INSTRUCTIONS) _
Revised 12/84
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��'. � _ ,,��' _ FAX (612) 223-5198
' PORT AUTHORIN OF THE CITY OF SAINT PAUL TOLL FREE (800) 328-8417
��.___ 1900 AMHOIST TOWER • 345 ST. PETER STREET � ST. PAUL, MN, 55102 • PHONE (612) 224-5686
October 25, 1988
.
RECEIVEO�
OCT 281988
Mr. Ken Johnson, Director
Planning and Economic Development Department �AY�'$(��
Ci ty of St. Pau I
13th Floor, City Hall Annex
St. Paul, Minnesota 55102
SUBJECT: ST. PAUL STAMP WORKS, INC.
$935,000 REVENUE BOND ISSUE
Dear Ken:
We submit herewith for your review and referral to the office of the
Mayor, City Council and City Attorney's office details pertaining to the
issuance of 3935,000 in revenue bonds to finance the construction of a
20,950 square foot office/production facility in Empire Builder In-
dustrial Park for St. Paul Stamp Works, Inc.
The Port Authortty will submit an application for an industrtal revenue
bond allocation from the State of Minnesota Competitive Pool as the
proJect is industrial . The City of Saint Paul 's entitlement allocation
will not be affected by this application.
The Port Authority staff has conducted a thorough evaluation of the
firms and/or individuals that are involved in this proJect or in which
the principals have an interest. This investigation has inciuded
detailed credit analysis, Dun and Bradstreet reports, direct communica-
tion with representatives of financial institutions with whan the par-
ticipants have done business and data base checks to determine if any
principal (s) have been in any way involved in legal proceedings as a
result of securities fraud, extortion, embezzlement or financial mis-
representation.
EUGENE A.KRAUT,C.I.D. PERRY K.FEDERS,C.PA CHARLES M.TOWLE LAWRENCE H.LANGER,P.E. PATRICK E.DEAN,C.P.A.
D�CUTNE ViCE PRESIDEM,C.E.O. PSSf.EXEC.VICE PRESIDEM,C.F.O. DIRECTOR INDU5TRWL DEVELOPMENT CHIEF ENGINEER FINANCE DIRECTOR
JAMES F.FAUE,C.I.D. RICHARD A.GIERDAL WILLIAM E.McGNERN
DIRECTOR RfA1 E5fAiE OPERAlIONS PROPER7`/MANAGER DIRECTOR PUBUC RELAl10NS
COMMISSIONERS: GEORGE W.WINTER WILLIAM R.PETERSON ARTHUR N.GOODMAN JEAN M.WEST VICTOR P.REIM JAMES SCHEIBEL ROBERT C.LONG
PRESIDENT VICE PRESIDENT SECRETARV ASST.SECREfA17V 7REASURER AS5f.TREASURER COMMISSIONER
C.I.D.CERTIFIED INDUSTRIAL DEVELOPER
'' . . c��'/7��7
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Mr. Ken Johnson
October 25, 1988
Page -2-
In addition to the staff inemorandum, we are attaching a draft copy of
the proposed City Council resolution and a copy of Port Authority
Resolution No. 3049 which authorized the sale of revenue bonds in the
amount of $935,000.
Your expeditious handling of this matter will be appreciated.
. lurs truly,
' � �����"�
��.p \
'Eugene A -Kraut
Executiv Vtce President
EAK:ca
cc. Mayor Latimer
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569P
Resolution No. �Q,S�9'
RESOLUTION OF
THE PORT AUTHORITY OF THE CITY OF SAINT PAUL
WHEREAS, one of the purposes of Minnesota Statutes ,
Chapter 469 (hereinafter called "Act" ) , as found and
determined by the legislature is to promote the welfare of the
state by the active, promotion, attraction, encouragement and
development of economically sound industry and commerce to
prevent so far as possible the emergence of blighted and
marginal lands and areas of chronic unemployment and to aid in
the development of existing areas of blight, marginal land and
persistent unemployment; and
WHEREAS, factors necessitating the active promotion
and development of economically sound industry and commerce
are the increasing concentration of population in the
metropolitan areas and the rapidly risinq increase in the
amount and cost of governmental services required to meet the
needs of the increased population and the need for development
of land use which will provide an adequate tax base to finance
these increased costs and access to employment opportunities
for such population; and
WHEREAS, the Port Authority of the City of Saint
Paul (the "Authority" ) has received from the St. Paul Stamp
Works, Inc . , a Minnesota corporation (hereinafter referred to
as "Company" ) a request that the Authority issue its revenue
bonds (which may be in the form of a single note) to finance
the acquisition, installation and construction of facilities
for the manufacturing of marking and identification products
( hereinafter collectively called the "Project" ) in Empire
Builder Industrial Park in the City of St. Paul, all as is
more fully described in the staff report on file; and
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WHEREAS, the Authority desires to facilitate the
selective development of the community, to retain and improve
its tax base and to help it provide the range of services and
employment opportunities required by its population, and said
Project will assist the City in achieving that objective.
Said Project will help to increase the assessed valuation of
the City and help maintain a positive relationship between
assessed valuation and debt and enhance the image and
reputation of the City; and
WHEREAS, the Project to be financed by revenue bonds
will result �n substantial employment opportunities in the
Project;
wHEREAS, the Authority has been advised by repre-
sentatives of the Company that conventional, commercial
financing to pay the capital cost of the Project is available
only on a limited basis and at such high costs of borrowing
that the economic feasibility of operating the Project would
be significantly reduced;
WHEREAS, Miller & Schroeder Financial, Inc . (the
"Underwriter" ) has made a proposal in an agreement (the
"Underwriting Agreement" ) relating to the purchase of the
revenue bonds to be issued to finance the Project;
WHEREAS, the Authority, pursuant to Minnesota
Statutes, Section 469 . 154, Subdivision 4 , did publish a
notice, a copy of which with proof of publication is on file
in the office of the Authority, of a public hearing on the
proposal of the Company that the Authority finance the Project
hereinbefore described by the issuance of its industrial
revenue bonds; and
WHEREAS, the Authority did conduct a pub.lic hearing
pursuant to said notice, at which hearing the recommendations
contained in the Authority' s staff inemorandum to the
Commissioners were reviewed, and all persons who appeared at
the hearing were given an opportunity to express their views
with respect to the proposal .
NOW, THEREFORE, BE IT RESOLVED by the Commissioners
of the Port Authority of the City of Saint Paul, Minnesota as
follows:
1 . On the basis of information available to the
Authority it appears, and the Authority hereby finds, that
said Project constitutes properties, used or useful in
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connection with one or more revenue producing enterprises
engaged in any .business within the meaning of Subdivision 2 of
Section 469 . 153 of the Act; that the Project furthers the
purposes stated in Section 469 . 153 of the Act and, but for the
willingness of the Authority to furnish such financing, the
Company would not undertake the Project, and that the effect
of the Project, if undertaken, will be to encourage the
development of economically sound industry and commerce and
assist in the prevention of the emergence of blighted and
marginal land, and will help to prevent chronic unemployment,
and will he1F the City to retain and improve its tax base and
provide the �ange of services and employment opportunities
required by its population, and will help to prevent the
movement of talented and educated persons out of the state and
to areas within the state where their services may not be as
effectively used and will result in more intensive development
and use of land within the City and will eventually result in
an increase in the City' s tax base; and that it is in the best
interests of the port district and the people of the City of
Saint Paul and in furtherance of the general plan of
development to assist the Company in financing the Project.
2 . Subject to the mutual agreement of the
Authority, the Company and the purchaser of the revenue bonds
as to the details of the lease or other revenue agreement as
defined in the Act, and other documents necessary to evidence
and effect the financing of the Project and the issuance of
the revenue bonds, the Project is hereby approved and
authorized and the issuance of revenue bonds of the Authority
(which may be in the form of a single note) in an amount not
to exceed approximately $935, 000 (other than such additional
revenue bonds as are needed to complete the Project) is
authorized to finance the costs of the Project and the
recommendations of the Authority' s staff, as set forth in the
staff inemorandum to the Commissioners which was presented to
the Commissioners, are incorporated herein by reference and
approved.
3 . In accordance with Subdivision 3 of Section
469 . 154 , Minnesota Statutes, the Executive Vice-President of
the AUTHORITY is hereby authorized and directed to submit the
proposal for the above described Project to the Commissioner
of Trade and Economic Development, requestinq his approval,
and other officers, employees and agents of the AUTHORITY are
hereby authorized to provide the Commissioner with such
preliminary information as he may require.
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4 . There has heretofore been filed with the
Authority a form of Preliminary Agreement between the
Authority and Company, relating to the proposed construction
and financing of the Project and a form of the Underwriting
Agreement. The forms of the agreements have been examined by
the Commissioners . It is the purpose of the agreements to
evidence the commitment of the parties and their intentions
with respect to the proposed Project in order that the Company
may proceed without delay with the commencement of the
acquisition, installation and construction of the Project with
the assurance that there has been sufficient "official action"
within the meaning of the Internal Revenue Code of 1986 , as
amended, to allow for the issuance of industrial revenue bonds
( including, if deemed appropriate, any interim note or notes
to provide temporary financing thereof) to finance the entire
cost of the Project upon agreement being reached as to the
ultimate details of the Project and its financing. Said
Agreements are hereby approved, and the President and
Secretary of the Authority are hereby authorized and directed
to execute said Agreements .
5 . Upon execution of the Preliminary Agreement by
the Company, the staff of the Authority is authorized and
directed to continue negotiations with the Company so as to
resolve the remaining issues necessary to the preparation of
the lease and other documents necessary to the adoption by the
Authority of its final bond resolution and the issuance and
delivery of the revenue bonds; provided that the President (or
Vice-President if the President is absent) and the Secretary
(or Assistant Secretary if the Secretary is absent) of the
Authority, or if either of such officers (and his alternative)
are absent, the Treasurer of the Authority in lieu of such
absent officers, are hereby authorized in accordance with the
provisions of Minnesota Statutes, Section 475 .06 , Subdivision
1, to accept a final offer of the Underwriter made by the
Underwriter to purchase said bonds and to execute an
Underwriting Agreement setting forth such offer on behalf of
the Authority. Such acceptance shall bind the Underwriter to
said offer but shall be subject to approval and ratification
by the Authority in a formal supplemental bond resolution to
be adopted prior to the delivery of said revenue bonds .
6 . The revenue bonds ( including any interim note
or notes) and interest thereon shall not constitute an
indebtedness of the Authority or the City of Saint Paul within
the meaning of any constitutional or statutory limitation and
shall not constitute or give rise to a pecuniary liability of
the Authority or the City or a charge against their general
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credit or taxinq powers and neither the full faith and credit
nor the taxing powers of the Authority or the City is pledged
for the payment of the bonds (and interim note or notes) or
interest thereon.
7 . In order to facilitate completion of the
revenue bond financing herein contemplated, the City Council
is hereby requested to consent, pursuant to Laws of Minnesota,
1976 , Chapter 234, to the issuance of the revenue bonds
( including any interim note or notes ) herein contemplated and
any additional bonds which the Authority may prior to issuance
or from time to time thereafter deem necessary to complete the
Project or to refund such revenue bonds; and for such purpose
the Executive Vice President of the Authority is hereby
authorized and directed to forward to the City Council copies
of this resolution and said Preliminary Agreement and any
additional available information the City Council may request .
8 . The actions of the Executive Vice-President of
the Authority in causing public notice of the public hearing
and in describing the general nature of the Project and
estimating the principal amount of bonds to be issued to
finance the Project and in preparing a draft of the proposed
application to the Commissioner of Trade and Economic
Development, State of Minnesota, for approval of the Project,
which has been available for inspection by the public at the
office of the Authority from and after the publication of
notice of the hearing, are in all respects ratified and
confirmed. �
Adopted October 25, 1988 .
Attest �J
Pr
The Po Authority of the City
of Sa' t Paul
����
Secretary
5
J� , P O R T �8�1���
.,
AUTHORITY
OF THE CITY OF ST. PAUL
MemoPandum
TO: BOARD OF OOMMISSIONERS DATE Oct. 20, 1988
(Oct. 25, 1988 Regular Meeting)
,
FROM: J.A. Campobasso '
SUBJECT: ST. PAUL STAMP WORKS, INC.
PUBLIC HEARING - PRELIMINARY b UNDERWRITING AGREEMENTS
$935,000 TAX EXEMPT REVENUE BOND ISSUE
EMPIRE BUILDER INDUSTRIAL PARK
RESOLUTION N0. 3049
PUBLIC HEARING - SALE OF LAND
RESOLUTION N0. 3050
PUBLIC HEARING - CREATION OF INDUSTRIAL DEVEIOPMENT DISTRICT
947 UNIVERSITY AVENUE
RESOLUTION N0. 3051 -
1. IHE COMPANY
St. Paul Stamp Works, Inc. was established in 1870 and has been owned and
operated by four generations of the Meligren family. As the name indi-
cates, the company has been located in St. Paul since its inception and
presently owns a facility at 946 University Avenue.
St. Paul Stamp Works is one of the largest manufacturers of marking and
identification products in the country. These products include custom
hand stamps for improving paper flow, decorative trim, nameplates and
labels for identifying products and making equipment for stamping variable
information on customer parts.
The company presently has 37 full time employees and anticipates the crea-
tion of another eight positions within the next three years. They have
entered into the City's First Source Agreement and are already proceeding
with the hiring of a new employee under this program.
The company also has a subsidiary located in Chicago. The subsidiary has
19 employees and has a three-year lease at that location. It is an-
ticipated that the Chicago operation will be combined at the St. Paul
facility once the lease has expired thereby creating additional job oppor-
tunities.
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BOARD OF COMMISSIONERS
October 20, 1988
Page -2-
2. THE PROJECT
St. Paul Stamp Works will construct a 20,950 square foot facility in Em-
pire Bullder industrial Park which will include 6,200 square feet of of-
fice and 14,750 square feet of production space. The pians allow for an
addition to be constructed to the north as the company continues to grow.
The Port Authority would swap the site containing 93,860 square feet for
the company's existing facility on University Avenue. The land price is
$187,720 based on $2 per square foot. The Stamp Works present butlding
was appraised at $290,000 by Muske Company, Inc. in September, 1988. A
purchase price of $218,000 was agreed upon with the company. The dif-
ference of $30,280 will be paid when the company moves into their new
facility.
St. Paul Stamp will remain in the University Avenue facility until con-
structton is completed on their new building. They will cover all operat-
ing costs including insurance and utilities. During this period, the Port
Authority will proceed with marketing the tacllity with the anticipation
of selling it immediately upon St. Paul Stamp's relocation.
The company has submitted an Enterprise Zone application in which credits
totaling $160,000 wiil go to them for filling new positions through the
City's Job Creation and Training Office and for the new investment in the
facility.
3. FINANCING
The proposed financing would be done as an 876 tax exempt industrial
development revenue bond issue for a 30-year term. Proceeds from the bond
issue would be as follows:
Construction $876,562.50 -
Capitalized Interest - 6 Months 39,737.50
Bond Issuance Cost 18,700.00
TOTAL $935,000.00
The company will pay bond issuance and discount costs beyond those incor-
porated in the bond issue of $30,855. They will also provide a cash
deposit of $90,208 for the debt servtce reserve. St. Paul Stamp Works'
equity in the project including the land will be $308,783 or approximately
25� of the total proJect.
The Port Authority would receive earnings on the sinking fund as well as
the customary fiscal and administrative fees based on a rate of $350 per
month for the tirst ten years, $450 per month for the second ten years and
$550 per month for the third ten years ot the lease.
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BOARD OF COMMISSIONERS
October 20, 1988
Page -3-
The Port Authority wtll submit this proJect to the State of Minnesota's
revenue bond competitive pool for allocation as an industriai proJect.
Authorization to issue the bonds should be received by November 14 wtth
sale of bonds profected for the November 22 Board meeting.
4. UNDERWRITING
Miller 8 Schroeder Financial, Inc. has agreed to underwrite the thirty-
year bond issue at an interest rate to be set at the time the bonds are
so I d.
5. TERMS OF THE LEASE
The term of the lease would be for thirty years. The company will have an
option to purchase at 10, 20 and 30 years for the outstanding principal
balance on the bonds plus 10� of the original bond issue.
6. RECOMMENDATIONS
Staff has met with neighborhood councils in District 6 and 7, and they
both support the project.
Staff has interviewed the officers of the company, reviewed the corporate
financial statements and recommends approval of Resolution Nos. 3049 ,
3050, and 3051 which approve the Preflminary and Underwriting Agreements,
the sale of land and creation of the industrial district respectively.
JAC:ca
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- Members:
� Bill Wiison, chair
CITY OF SAINT PAUL Tom Dimond
cuwt4lil '
e�u I li ll
OFFICE OF THE CITY COIINCIL Kiki Sonnen
Date: November 9, 1988
i
WIL.LIAM L. WILSON MARK VOERDING
Co,����an C o m m i tt e e R e p o rt �g�s�at��e Aide
To: Saint Paul City Council
From : Housing and Economic Development Committee
Biil Wilson, Chair '
l. Approval of Minutes - APPROVED �
2. Presentation - "Year of the Cities"
NO CONII�IITTEE ACTION REQUIRID
3. Economic Development Strategy IIpdate
NO CONIl�IITTEE ACTION REQUIRED
� 4. Appeal of Michael D. Williams on the denial of a request for House Number and/or
waiver for Lot 45, Block 12, Burlington Heights, Division 1
COI�M�IITTEE RECOMMIIVDED DEDIIAL OF TE� APPEAL AND WAIVIIZ REQUEST (3-0) ,
5. Enterprise Zone Application for St. Paul Stamp Works, Inc.
COMMITTEE RECOI�IENDED APPROVAL (3-0) -
. �te�nue �s f or S t. Paul� S tamp Wo�rks, -�nc.
CArM4ITTEE REGO��i?ID APPRUVAL (3-0)
7. Resolution - Fmergency Fund Service, Inc. , $1,400,000 Revenue Bond Issue
COMMITTEE RECOMMII�TDED DISAPPROVAL (2-1) .
R�CEIVED�
N�� �-0 '1��� '`,
GITY CLER�.
CITY HALL SEVENTH FLOOR SAINT PAUL, MINNESOTA 55102 612/298-4646
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