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84-1327 WMITE - CITV CLERK PINK - FINANCE G I TY O F SA I NT PA U L Council //yy [[[ /` N CANARV - DEPARTMENT (%��/�� BLUE - MAVOR File NO. d � • Co c,il Resolution Presented By I/ Re erred To 1'� ^/�Lt Committee: Date ( ~� � "� � Out of Committee By Date WHEREAS: 1. On August 21, 1984, the Port Authority of the City of Saint Paul adopted Resolution No. 2314 giving preliminary approval to the issuance of revenue bonds in the initial principal amount of $1,400,000 to finance the construction of a 40,000 square foot warehouse addition to the building at 403 Fillmore Avenue East in Riverview Industrial Park for Kaplan Paper Box Company, Inc. The bonds will be underwritten by Miller & Schroeder Municipals, Inc. 2. 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 resolution adopted in accordance with law; 3. The Port Authority of the City of Saint Paul has requested that the City Council 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. RESOLVED, by the City Council of the City of Saint Paul, that in accordance with Laws of Minnesota 1976, Chapter 234, the City Council hereby consents to the issuance of the aforesaid revenue bonds for the purposes described in the aforesaid Port Authority Resolution No. 2314 the exact details of which, including, but not limited to, provisions relating to ma.turities, interest rates, discount, redemption, and for the issuance of additional 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 additional bonds (including refunding bonds) by the Port Authority, found by the Port Authority to be necessary for carrying out the purpo`ses for which the aforesaid bonds are issued. COUIVC[LMEN Requested by Department of: Yeas ��`LYNNS �� o`e'" � In Favor Masanz Nfcosia L� __ Against BY 5��'��`��r Scheibel Tedesco � ,1�iNcan Adopted by Council: Date SEP 2 7 198� Form Approved by City Attorney Certified Y : C il S BY ��---�"�'"' �=—L.2� ss. �� `� $� App d by iNavor. Dat tJ�+T - 1 1984 Approved by Mayor r Subm sio o Council � � B — PU�LIS4if0 OCT 61984 . . � � . . . G�f�-�'t1''/.3z7 St. Paul Port Authoritv DEPARTh1ENT � ' D G. Dunshee, E A KrautrONTACT `� 224-5686 PHONE �� August 22, 1984 DATE �v (Routing and Explanation Sheet) Assign Number for Routing Order (Clip Al1 Locations for Mayoral Signa�ure): � �epartment oi rector RECEIVED 2 i ty Attorney �- AUG 3 1 1gg4 Director of Management/Mayor ��E� Fi nance and Management Servi ces Di rector R�� CITY ATTORIVEY 5 City C1erk 5'�� D�~��C Budget Di rector ��r`�,.' �� .. ,� pF� �RV�CEs N N S 4.�,�.�, G��E a�p �T�P� What Will be Achieved by Taking Action on the Attached Materials? (Purpose/Rationale):_ The purpose of the bond issue is to finance the construction of a 40;000 square foot warehouse addition to the building at 403 Fillmore Avenue East in Riverview Industrial Park for Kaplan Paper Box Company, Inc. This would permit the Company to consolidate all of their operations into one building. Financial , Budgetary and Personnel In�pacts Anticipated: The amount of the bond issue is $1 ,400,000 and will be for a term of 30 years. `- � � Funding Source and Fund Activity Number Charged or Credited: f= � /.1,+� � �� Attachments (Li st and Nurr�er al l A�tachrr�ents� : 1 . Staff inemorandum ; 2. Draft City Council Resolution 3. Port Authority Resolution No. 2314 cc. D. Thorpe DEPARTMENT REVIEW CITY ATTORNEY REVIEW X Yes No Council Resolution Required? Resolution Required? X Yes No Yes x No Insurance Required? Insurance Sufficient? X Yes _ No Yes X No Insurance Attached? Revision of October, 1982 � (�ee Reverse Side for Instructions) - ��0 R T - � � � � ��_��.��-� ' `AUTHORITY � oF TMe cmr oF sT. PAUL - Memo�andurn . TO: gOARD OF COh�IISSIONERS �� August 17, 1984 (Regular Meetinq 8/21/84) FROM: D. G. Dunsf�ee SUBJECT: KppLqN PAPER BOX CO. , INC. - 876 PUBLIG HEARIN6 PRELIMINARY & UNDERWRITIN6 A6REEMENT - �1,400,000 REVENUE BOND ISSUE RIVERYIEW INDUSTRIA�. PARK RESOLUTION N0. 2314 1. The Company The Company presently operates a printing business in a building leased from the Port Authority at 403 Fillmore Avenue East in Riverview Industrial Park. This building was originally constructed in 1968 for McMillan Manufacturing Company who operated the structure until the lease was assigned to Kaplan Paper Box Company in May of 1976. The facility contains 87,000 sq.ft. and is situated on a site containing 308,475 sq.ft. The original bond issue was for �950,000. At the present time the Company employs 130 people. 2. The Pro�ect The Company proposes to construct a 40,000 sq.ft. warehouse addition at the rear of their present building. This would permit the Company to consolidate all of their.operations into one building as they are now leasing storage space in a multi-story building on the west-side. They also will be repairing the roof on the existing building and modifying the paper scrape removal system. 3. Financing The proposed financing would be done as an 876 industrial development revenue bond issue for a 30 year term. Proceeds from the bond issue would be as follows: Construction �1,110,000.00 Bond Issuance Expense 25,000.00 Capita1ized Tnterest puring Construction (6 months) 72,000.00 Debt Service Reserve 151,000.00 Discount 42,000.00 $1,400,000.00 � { . � � � � � �,��/-i.��7 � • BOARD OF COMaMISSIONERS -- - Augr�st 17, 1984 Page 2 � - The Port Authority would receive earnings on th� debt service reserve and sinking fund as well as the customary fiscal and administrative fees based on a formula of .42x per million per year for the first ten years, .54x per milliort per year for the second ten years and .66� per million per year for the third ten years of the lease. 4. Underwriting Miller & Schroeder Municipals,. Inc. has agreed to underwrite the 30 year bond_ issue at an interest rate to be set the date the bonds are sold. We anticipate the bonds will sell at the regular September 18, 1984 cortmission meeting. 5. Terms af the Lease The terms of the bond issue would be for 30 years witfi the Company having an option to purchase the buiiding for lOx of the original bond issue cost at the end of the lOth and 20th years or the end of the term. 6. Recommendation At the present time of the original bond issue of $950,000, only �595,00� remains outstanding. On October 17, 1983 Wflliam Muske prepared an appraisal of the buitdinq and placed a value of $2,300,000 on the structure. The proposed bond issue and the money outstanding on the oriqinal bond issue is �305,000 less than the appraisal which did not reflect the proposed expansion. Staff recon�nds approval of Resolution No. 2314. OGD:Ir . ; . - � � ' � � � �/- /�,�y � �/ Resolution No. v�3�1" RESOLUTION OF THE PORT AUTHORITY OF THE CITY OF SAINT PAUL WHEREAS, the purpose of Chapter 474, Minnesota Statutes, knam as the Minnesota Municipal Industrial Develop- ment Act (hereinafter called "Act") as found and determi.ned by the legislature is to promote the welfare of the state by the active attraction and encouragement and development of economi- cally sound industzy and connnerce to prevent so far as possible the emergence of blighted and marginal lands and areas of chronic unemplayjnent and to aid in the development of existing areas of blight, marginal land and persistent unemployment; and WEiEREAS, factors necessitating the active promotion and development of economically sound industry and cammerce are the increasing concentration _of population in the metropolitan areas and the rapidly rising 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 Kaplan Paper Box Company, znc. (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 construction of a 40,000 square foot warehouse addition (hereinafter called the "Project") to the rear of the facilities presently occupied by the Company at 403 Fillmore Avenue East in the City of St. Paul, all as is nore fully described in the staff report on file; and WHEREAS, the Authority desires to facilitate the selective develop�nent of the community, to retain and improve its ta�c 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 � � • _ � � � � - ��/-/3z 7 ; .. WHEREAS, the Project to be financed b�� revenue bonds will result in 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, but the Company has also advised this Authority that but for the aid of revenue bond financing, and its resulting laa borrowing cost, the Project would not be undertaken; WHEREAS, Miller & Schroeder Municipals, Inc. (the "Underwriter") has made � 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 474.01, Subdivision 7b 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 V7HEREAS, the Authority did conduct a public hearing pursuant to said notice, at which hearing the reco�nmendations contained in the Authority' s staff inemorandum to the Commi.ssioners 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 follvws: 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 connection with one or more revenue producing enterprises engaged in any business within the meaning of Subdivision 1 of Section 474.02 of the Act; that the Project furthers the purposes stated in Section 474.01 of the Act, that but for the availability of t'ne financing under the Act and 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 developcnent of economically sound e , , _ � � � �=-�//��y industry and com¢nerce and assist in the prevention of the emergence of bliyhted and marginal land, and will help to prevent chronic unernployment, and will help the City to retain and improve its tax base and provide the range of services and esaployment opportunities required by its population, and will help to prevent the mov�nent 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 tlze 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 $1,400,000 (other than such additional revenue bonds as are needed to complete the Project) is authorized to finance the costs of the Project and the recomanendations of the Authority' s staff, as set forth in the staff inenwrandum to the Commissioners which was presented to the Comm.issioners, are incorporated herein by reference and approved. 3. In accordance with Subdivision 7a of Section 474.01, rdinnesota Statutes, the Executive Vice-President of the AUTHORITY is hereby authorized and directed to submit the proposal for the above described Project to the Cosnmissioner of Energy and Economic Development, requesting 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. 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��,form of said Agreements have been examined by the Coanmissioners: It is the purpose of said Agreements to evidence the commi.tment 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 _ - t , , ; - - • �� ' - " � � ' ��-/-� � - the assurance that there has been .�ufficient "official action" under Section 103(b) of the Internal Revenue Code of 1954, 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 Pro�ect 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 are 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 necessaxy 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 Underwriters made by the Underwriters to purchase said bonds and to execute an underwriting agreement setting forth such offer on behalf of the Authority. Such acceptance shall bind the Underwriters to said offer but shall be subject to approval and ratification by the Port 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 credit or taxing 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 � � � , . - • • � C��'-/.�27 �h' �' � ' .. additional bonds which the Authority may prior to issuance or froan time to time thereafter de�n necessary to complete the - Project or to refund such revenue bonds; and for such purpose the Executive Vice President of the Authority is hereby autho=ized and directed to forward to the City Council copies of this resolution and said Preliminary Agreement and any additional available infoxmation 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� �e issued to finance the Project, and in preparing a drafti� of the proposed application to the Commissioner of Energy 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 August 21, 1984 �� Attest -' � ' Pr TherPo Authority of the City �., _� / of Sa' t Paul / ;', :� � � _ � ,/ / � �,,�; ,� i'� •/�� Z � �-�., _a�1�f , ' — =�cretary ' ( . � . 3 ��,, � ��/�.�� 7 ,, Finance Committee Agenda September 20, I984 Page 2 9. Resolution consenting to the issuance of Port Authority Revenue bonds in the amount of $4,750,000 to finance the construction of an 80,000 square f oot cooler and freezer facility in Riverview Industriai Park for GRL Cold Storage. 10. Resolution consenting to the issuance of Port Authority Revenue bonds in the amount of $1,100,000 to finance Ieasehold improvements at 450 N. Syndicate for the C. Angus Wurtele, Clarkson Lindley � Mary Wurtele Vaughan Trusts. 11. Resolution consenting to the issuance of Port Authority Revenue bonds in the �amount of $1,325,000 to finance the construction of a 25,000 sq. ft. office, •warehouse and distribution facility in Energy Park for P.M. Properties, Inc. '�o be subleased to Craighead f� Associates, Inc. dba Power/Mation: 12. Resolution consenting to the issuance of Port Authority Revenue bonds in the amount of $5,000,000 to finance the construction of a 72, 170 sq. ft. building in Energy Park for Partnership Technology, Inc. , a subsidiary of iti'infield bevelopments, Inc. 13. Resolution consenting to the issuance of Port Authority Revenue bonds in the amount of $600, 000 to finance the construction of a 2,500 sq. ft. truck an d garage repair facility and a 2, 100 sq. ft. cooler addition to the building at 370 University A�-e. for Old Home Foods, Inc. 14. Resolution consenting to the issuance of Port Authority Revenue bonds in the amount of 51,000,000 to finance the rehabilitation of an existing 90,000 sq. ft. facility at 800 Hampden in St. Paul and to expand it by 40,000 sq. ft. for Roger Greenberg dba Bro-Tex, Inc. 15. Resolution consenting to the issuance of Port Authority Revenue bonds in the amou�t of $1,400,000 to finance the construction of a 40,000 sq. ft. warehouse addition to the building at 403 Fillmore Avenue East in Riverview Industrial Park for Kaplan Paper Box Co. , Inc. • 16. Ordinance amending Sections 34.K F� 34. L in the Civil Service Rules by establishing the classification Associate Director of Personnel in the Unclassified Ser;�ice. (Personnel) 17. Resolution amending the Salary Plan and Rates of Compensation Resolution regarding the Associate Director of Personnel classification. (Per.sonnel) 18. Resolution revising the class specification for tidater Laborer in the Civil Service Rules. (Personnel) 19. Resolution approving 1984-1985 Agreement bet►veen the ISD #625 and the Teamsters � Local 320 representing Food Service Personnel. (Personnel) 20. Ordinance amending Chapter 183 of the St. Paul Legislative Code and pertaining to the set-aside program Prohibiting acts regarding the same, and vesting investigative responsibilities in the Human Rights Department iaith respect to the set-aside program. 21. Issuance of Industrial Revenue Bonds for Continental Safety Building. (PED)