86-996 WHITE w- CITV CLER
PINK - PINANCE C�IInCII
�LUERV `MAyPp{ZTME T G I TY O F SA I NT PA U L
File N 0. � ` g9�
� .Cou ci �Resolution
Presented By
Ref o Committee: Date
Out of C mm ttee By Date
RESOLUTION RECITING A PROPOSAL FOR A
FINANCING PROGRAM FOR A MULTI-FAMILY RENTAL
' HOUSING DEVELOPMENT, GIVING PRELIMINARY
APPROVAL TO THE PROJECT AND THE PROGRAM
URSUANT TO MINNESOTA STATUTES, CHAPTER 462C,
AUTHORIZING THE HOU5ING AND REDEVELOPMENT
AUTHORITY OR MINNEAPOLIS/SAINT PAUL HOUSING
FINANCE BOARD TO ISSUE HOUSING REVENUE BONDS
AND AUTHORIZING THE SUBMISSION OF ,
FINANCING PROGRAM EOR APPROVAL TO THE
MINNESOTA HOUSING FINANCE AGENCY AND
AUTHORIZING THE PREPARATION OF NECESSARY
DOCUMENTS AND MATERIALS IN CONNECTION
WITH THE SAID PROJECT AND PROGRAM
(614 SELBY PROJECT)
WHEREAS, �
(a) Minnesota Statutes, Chapter 462C
(the "Act) confers upon cities, or housing
and redevelopment authorities or port
authorities authorized by ordinance to
exercise on behalf of a city the powers
conferred by the Act, the power to issue
' revenue bonds to finance a program for the
purposes of planning, administering, making
or purchasing loans with respect to one or
' more multi-family housing developments within
the boundaries of the city;
COUNC[L EN
Yeas N ys Requested by�partQ�ent of:
Drew �4���
Masanz [n Favor
Nicosia
Scheibel
so�nen ' _ Against BY
Tedesco
Wilson
Adopted by Council: Date Form A ved by City Attor�
Certified Passed b Co ncil Secretary , gY / ''
By
Approved by Mavor: ate Approv M or for Submiss' ei} -
By B
. . � . . � �i=-�� ����
(b) The Housing and Redevelopment
� Authority of the City of Saint Paul,
Minnesota (the "HRA" ) has been designated, by
ordinance, to exercise, on behalf of the City
of St. Paul, Minnesota (the "City" ) the
powers conferred by Minnesota Statutes,
Section 462C.01 to 462C.08;
(c) The HRA and the Minneapolis
Community Development Agency (the "CDA" ) have
entered into a Joint Powers Agreement dated
, December 1 , 1984 creating the
Minneapolis/Saint Paul Housing Finance Board
(the "Board" ) , which is authorized to
exercise on behalf of the Cities of
Minneapolis and St. Paul and the HRA and CDA
the powers conferred by the Act;
(d) The City has received from Greg
Hotzler, Paul Sween, Mark Sween, Leo Gadbois
and CEA Real Estate, Inc. (the "Developer" ) a
i proposal that the City undertake a program to
finance a Project hereinafter described,
through the issuance of revenue bonds or
obligations ( in one or more series) (the
' "Bonds" ) pursuant to the Act;
(e) The City desires to: facilitate
' the development of rental housing within the
community; encourage the development of
affordable housing opportunities for
residents of the City; encourage the
development of housing facilities designed
for occupancy by persons of low or moderate
income ; and encourage the development of
' blighted or underutilized land and structures
within the boundaries of the City; and the
Project will assist the City in achieving
these objectives.
(f) The Developer is currently engaged
in the business of real estate development.
The Project to be financed by the Bonds is
the rehabilitation of an existing building
for use as a multi-family rental housing
�, development of approximately 14 rental units
located at 614 Selby Avenue, in the City of
St. Paul, and consists of the acquisition of
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an existing structure and the rehabilitation
� thereof which will result in the provision of
additional rental housing opportunities to
persons within the community;
(g) The City has been advised by
representatives of the Developer that con-
ventional, commercial financing to pay the
capital costs 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, but the Developer has
' also advised the City that with the aid of
municipal financing, and resulting low
borrowing costs, the Project is economically
more feasible;
(h) A public hearing on the Project and
, the financing program therefor was held on
July 22, 1986, after notice was published,
all as required by Minnesota Statutes,
Section 462C.05, subd. 5, at which public
hearing all those appearing at said hearing
who desired to speak were heard and written
comments were accepted and considered;
( i) No public official of the City has
either a direct or indirect financial
interest in the Project nor will any public
official either directly or indirectly
benefit financially from the Project ;
' (j ) The Developer has submitted to the
HRA a form of Memorandum of Understanding
executed by the Developer, expressing certain
understandings by and between the HRA aMd the
Developer pertaining to the Project, and the
financing therefor.
' NOW THEREFORE, BE IT RESOLVED by the City Council of
the City of Saint Paul, Minnesota, as follows:
I 1. The City hereby gives preliminary approval to the
propo �al of the Developer that the City undertake the Project,
describe above, and the program of financing therefor,
pursu nt to Minnesota Statutes, Chapter 462C, consisting of the
, ' , ' /,7r �p -rj��o
�:�-
acquisi ion of land and improvements and rehabilitation thereof
for use s multi-family rental housing facilities within the
City u uant to the Developer' s specifications and to a
reven e greement between the HRA or Board and the Developer on
such e s and conditions with provisions for revision from
time o ime as necessary, so as to produce income and revenues
suffici t to pay, when due, the principal and interest on the
Bonds i the total principal amount of approximately $500,000
to be i ued pursuant to the Act to finance the acquisition,
const' u ion and equipping of the Project ; and said agreement
may a s provide for the entire interest of the Developer
there 'n o be mortgaged to the purchasers of the Bonds, or a
trust e or the holder(s) of the Bonds; and the City, acting by
and thr gh the HRA or Board, hereby undertakes preliminarily
to issu its bonds in accordance with such terms and
conditi s;
2. At the option of the HRA or Board, the financing
may b ructured so as to take advantage of whatever means are
avail b and are permitted by law to enhance the security for,
or marke ability of, the Bonds; provided that any such
financi structure must be consented to by the Developer.
3. On the basis of information available to the City
it ap e s, and the City hereby finds, that the Project consti-
tutes a ulti-family housing development within the meaning of
subdi is'on 5 of Section 462C.02 of the Act; that the Project
will be rimarily occupied by persons of low or moderate
income; he availability of the financing under the Act and the
willi gn ss of the City to furnish such financing will be a
subst nt' al inducement to the Developer to undertake the
Proje t, and that the effect of the Project, if undertaken,
will e o encourage the provision of rehabilitated
multi-fa ily rental housing opportunities to residents of the
City, to assist in the redevelopment of blighted and marginal
land and to promote more intensive development and use of land
withi t e City;
4. The Project, and the program to finance the
Proje t y the issuance of revenue bonds, is hereby given
prelimin ry approval by the City subject to the approval of the
financin program by the Minnesota Housing Finance Agency
( "MHFA" ) and subject to final approval by the HRA or Board, the
Devel pe and the purchasers of the Bonds as to ultimate
detai s f the financing of the project;
. � � , , � �,� �� -�9�
. .
5. Pursuant to Chapter 72, Saint Paul, Minnesota,
Aminilst ative Code, the City hereby authorizes and directs The
Housing and Redevelopment Authority of the City of Saint Paul,
Minnelso a (the "HRA" ) to issue the housing revenue bonds to
finanlce the Project and to take all actions necessary or
desir�ab in connection therewith, and no further approval or
authori tion of the City shall be required; provided that the
HRA m�ay, in its discretion, authorize the Board to issue the
BondsI a to implement the program approved hereby, and the
City he by consents thereto;
6. In accordance with subdivision 5 of Section
462C.05, Minnesota Statutes, the Executive Director of the HRA
is he�e authorized and directed to submit the program for
finan�in the project to MHFA, requesting its approval, and
other of icers, and employees and agents of the City and HRA
are h�re y authorized to provide MHFA with preliminary
infor�jnat on as it may require;
7. The Developer has agreed and it is hereby
deter�in d that any and all costs incurred by the City, the HRA
or th B ard in connection with the financing of the Project
wheth�r r not the project is carried to completion and whether
or not� a proved by MHFA will be paid by the Developer;
8. Briggs and Morgan, Professional Association,
actin� a bond counsel, and such investment bankers as may be
select�ed by the HRA or Board, are authorized to assist in the
preparat on and review of necessary documents relating to the
Projec�t nd the financing program therefor, to consult with the
City A�tt rney, Developer and purchasers of the Bonds (or
trust e or the purchasers of the Bonds) as to the maturities,
inter�st rates and other terms and provisions of the Bonds and
as tolth covenants and other provisions of the necessary
document and submit such documents to the HRA or Board for
f inal lap roval;
I 9. Nothing in this Resolution or the documents
prepar�ed ursuant hereto shall authorize the expenditure of any
munici�a funds on the Project other than the revenues derived
from t�e roject or otherwise granted to the City, the HRA or
the Bo r for this purpose. The Bonds shall not consitute a
chargel, 'en or encumbrance, legal or equitable, upon any
proper�ty r funds of the City, the HRA or the Board except the
revenue d proceeds pledged to the payment thereof, nor shall
the Ci�y, the HRA or the Board be subject to any liability
,
WHITE „- CITV CLERIYC
PINK� - FINANCE GITY OF SAINT PAiTL Council � y/�y/�
� LAIVARY - pEPARTMENT � Flle NO. �L _ ! / �
BLt7E � - MAVOR �
Council '
Resolution
Presented By
ReferrediTo Committee: Date
Out of Cqmm ttee By Date
ther o . The holder of the Bonds shall never have the right to
comp�el ny exercise of the taxing power of the City or HRA to
pay th outstanding principal on the Bonds or the interest
ther�eo , or to enforce payment thereon against any property of
the i , the HRA or the Board, except such property as may be
expr�es y pledged for the security of the Bonds. The Bonds
sha1X cite in substance that Bonds, including the interest
ther�o are payable solely from the revenue and proceeds
pledge to the payment thereof. The Bonds shall not constitute
a de t f the City or HRA within the meaning of any
cons�it tional or statutory limitation.
10. In anticipation of the approval by MHFA and the
issu�nc of the Bonds to finance all or a portion of the
Proj�ct and in order that completion of the project will not
be u du y delayed when approved, the Developer is hereby
auth�ri ed to make such expenditures and advances toward
paym�nt of that portion of the costs of the Project to be
finar�ce from the proceeds of the Bonds, as the Developer
cons�de s necessary, including the use of interim, short-term
fina ci g, subject to reimbursement from the proceeds of the
Bond� i any when delivered but otherwise without liability on
the ar of the City, the HRA or the Board.
COUNCILM N Requested by Department of:
Yeas �_ �Na ���
Masanz [n Favor
Nioosia
8af�etbel+
Sonnen � _ AgBinst BY
Tedesco
� JUL 2 2
Adopted by Council:l Date �� Form Appro by City tto y
Certified Pa. .il Sec a BY
t\p ve by 14avor. , Da J`�' 2 3 17VU Pr y Mayor for Submis i to il
B B'
UBUSHED �U G � 1��
PEO H si ,
DEPA#rTMENT ����� N� 05'730
� Gar lt r CONTACT
7494 . 59. PHONE
_ .
DATE Q� Q Q
� . _
IGN NUMBE.R . : UTING ORDER Cli Al1 Locations for Si aature :
partment ir tor �' 4 Director of Management/Mayor
Finance an Ma gement Services Director '- 5 City Clerk
udget, Di r� te ' �
ty AttAr y J.i m Hart)
HAT WILL BE A IE D BY TAKING ACTION 0N THE ATTACHED MATERIA�:S? (Purpose/
Rationale) :
� Prelir� na apprnval to issue privately p1aced tax exempt rental housing
reYen� o igatfon(s) for 614 Selby Pro�ect {commercial and 14 rentaT units)
I
� Cs� ��P
, �,-� � � .
COST BENEFIT B D6 ARY AND PERSONNEL IMPACTS ANTICIPATED: �
I
i
Oevelo� er ays all HRA/PEO fees
t .
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;
FINANCING SOURC BUDGET RCTIVITY NUMBER CNARGED OR CREDITED: (Mayor's signa-
ture not re-
Total Amountl f ' ransaction: quired if under .
; _ � ��o,000�
Funding Sour : i N/A .
�
Activity Num r• •
ATTACHMENTS Li a d Number All Attachments :
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City un '1 Resolution
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DEPARTMENT REVI CITY ATTpRNEY REYIEW
X Yes No nc 1 Resolution Required? (attached) ' Resolution. Required? Yes No
Yes �No I� ur nce Required? Insurance Sufficient? ,�fes No
Yes �No I ur nce. Attached: �
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i (SEE •REVERSE SIDE FOR INSTRUCTIONS) � �
Revised 12/84 i .
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I CITY OF SAINT PAUL
I INTERDEPARTMENTAL MEMORANDUM
DATE• � JULY 3, 1986
T0: ALBERT OLSON
FROM: I SHERI PEMBERTON, DEPT. OF PED �
SUBJE�T: CITY COUNCIL PUBLIC HEARING FOR JULY 22 , 1986
Attack�ed s a copy of the Public Hearing , which was published in the
St. P 1 egal Ledger and the St. Paul Pioneer Press and Dispatch on
S atur�ay July 5., 1986.
Pleas� p ce this Public Hearing on the City Council Agenda for Tuesday,
July 22 , 986. A City Council Resolution will be forwarded to you by
the City ttorney's Office , prior to the City Council Meeting.
Thank lyou
SAP:rmlf �
At t acY�nen I
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cc: Beck Hartman, Gary Peltier
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S6�E
��, NOTICE OF PUBLIC HEARING ON
;r';� PROPOSAL FOR A PROGRAM TO FINANCE A
MULTI-FAMILY RENTAL HOUSING DEVELOPMENT
i (614 SELBY PROJECT)
To wh it may concern:
Notice is hereby given that the City Council of the
Cit�y f Saint Paua., Minnesota will m�et in the City Council
Chamb rs at the City Hall in the City of Saint Paul, Minnesota
at� 10 o'clock a.m, on July 22 , 1986, to consider the
pr po al of the •Developer" identified below (the "Developer" )
th t he City undertake a program to finance the development
he�ei after described, pursuant to the City's housing plan
un�er Minnesota Statutes, Chapter 462C, by the issuance of
re en e obligations.
i The Development
The development consists of the acquisition
and rehabilitation of an existing building
for use as a multi-family rental housing
I development of approximately 14 residential
rental units located at 614 Selby Avenue in
i Saint Paul, Minnesota. Not less than 258 of
the units in the development will be occupied
by persons or families whose income is 80$ or
less of the median income (adjusted for
family size) for the St. Paul area as
I determined by the Un�ted States Department of
Housing and Urban Development or not less
than 2U$ of the units in the development will
I be occupied by persons or families whose •
income is 70$ of inedian income (adjusted for
family size) . Total approximate development
I casts to be �pproximately 51 , 100 ,000. The
Develop�nent will be owned and operated by
I Greg Hotzler, Paul Sween, Mark Sween, Leo
Gadbois and CEA Real Estate, Inc. or a
partnership or other entity to be formed in
Which those persons or entities will be
general partners. Non-housing components
will be included within the developcnent but
all (90$) of the facilities financed by bonds
or other obligations will consist of rental
housing and functionally related facilities.
I
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' The estimated principal amount of bonds or other obli-
gati s to be issued to finance the Development will be
ap' r imately $SOO,OOU. The bonds or other obligations may be
'rs u by the Minneapolis/Saint Paul Housing Finance Board (the
"B a ") or by the Housing and Redevelopment Authority of the
Ci y f Saint Paul, Minnesota (the "HRA" ) .
I Said bonds or other obligations, as and when issued,
wi 1 ot constitute a charge, lien or encumbrance upon any
pr p ty of the City, the HRA or the eoard except the
De e pment and the revenues to be derived from the
De e pment. Such bonds or obligations will not be a charge
ag i t the City's or HRA' s general credit or taxing powers but
are yable from sums to be paid by the owner of the
Deve pment pursuant to revenue agreements.
Further information concerning the Development, and
th inancing programs therefor, may be obtained from the
Ho s ' g Division, Department of Planning and Economic
De e pment, City Hall Annex - 12th floor, 25 West 4th Street,
St. ul, Minnesota 55102 (telephone 292-1577) .
At the time and place fixed for the public hearing,
th ity Council of the City of Saint Paul, Minnesota will
gi e all persons who appear at the hearing an opportunity to
ex r s their views with respect to the proposal. Written
co ts will be considered if submitted to the Housing
Divi ion on or prior to the date of the hearing.
Dated this 3rd day of July , 1986 .
(BY ORDER OF THE CITY COUNCIL OF
THE CITY OF SAINT PAUL,
MINNESOTA)
, By ALBERT OLSON
City C er
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