281097 WMITE - GTV CLERK 2�1��'�
PINK - FINANCE G I TY O F SA I NT PA U L Council
CANARV - DEPARTMENT File NO.
'BLUE - MAVOR
�
� , - ncil Resolution
,
Presented By
✓ Referred To���'��� Committee: Date l�� � ^�3
Out of Committee By Date
WHEREAS:
1. On July 5 , 1983, the Port Authority adopted Resolution No. 2163 giving
preliminary approval to the issuance of a tax exempt mortgage note in the amount
of approximately $5 ,100,000 to finance the acquisiton of the McColl building and
the construction of 26,000 square feet of office space on floors 6 and 7 of the
Galtier Plaza by Mears Park Partnerships. The tax exempt mortgage will be
privately placed with a local financial institution based upon a 30-year lease
with a 10-year put .
2. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue
bonds authorized by the Port Authority of the City of Saint Pau�., sha11 be issued
only with the consent of the City Council o�' the City of Saint Pau1, by resolution
adopted in accordance with 1aw;
3. The Port Autharity of the City o�' Saint Paul has requested that the
City Council give its requisite consent pursuant to said 1aw to facilitate the
issuance of said Tax Exempt Mortgage by the Port Authority of the City of Saint
Pau1, sub�ect to final. approval of the details o�' said issue by the Port
Authority of the City of Saint Pau1.
RESOLVED, by the City Council o�' the City of Saint Paul, that in accordance
with Laws of Minnesota 1976, Chapter 23�4, the City Council he�eby consents to
the issuance of the aforesaid Taa� Exempt Mortgage �or the purposes described
in the aforesaid Port Authority Resolution No, 2163 the exact details of which,
including, but not 1.imited to , provisions rel,ating to rn,aturities , intexest
rates , discount , redemption, and �'or the issuance of addition.a7. bonds axe to be
determined by the Port Authorit�, pursuant to reso�ution adopted by the Port
Authority, and the City Counci�., hereby authorizes the issuance o�' any additional
bonds (incl.uding refunding bonds) by the Port Authority, found by the Pox�t
Authority to be necessary �'or carrying out the purposes �'or which the aforesaid
bonds are issued.
COUNCILMEN Requested by Department of:
Yeas Nays �
Fletcher � �l
ceu� [n Favor
Masanz
Nicosia
Scheibel � __ Against BY
TedesCo
Wilson
OCT 2 7 1983 Form Appr by City ttorn y
Adopted by Council: Date ?
��
Certified Y-s o ncil reta By ,/ I'
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F�ppro e by 14avor. Date oE� �' � �`��� Appro by Mayor for Sub 's ' to Council
B �
� Y �—
PUBLiSHtD NOV � 1983
,�._. �rt Aut horit y DEPARTt,1ENT. , �rJ1�9 /
E. A. Kr aut �OI��ACT •
. 22 4-5 686 PHONE ''�`
J'uly 5 � 1983 DATE . i ��� ��
. (Routing and Explanation� Sheet�
.,. : .:. . . .:_; _ : . �. . ,
. ._ . ,. , . . . �
Assign Aiumber for Routing Order (Clip A11 Locations for Mayoral Si9nature):
_
` � Department Di rector rw
Ci Attorne � � . �
tY Y � ,
MaYar � ���� ��-r �--
4 Fi nance and Management Serv i rector ��,��� 2 � "1983
5 C3ty Cler�k
.... .�_ . .,- .�;._=
Budget Di rector
�lhat Will be Achieved by Taking Action on the Attached Materials? (Pu se Ratio�,nale�,
The purpose of the Tax Exempt Mortgage is to �inance the acquisiti,can of the
McColl building and construction of 26;000 square feet o;f of�ice space on �7,00rs
6 and 7 of the Ga�,tier P1aza bui7.din� b� Mears Park Partnerships. With the
acc�uisition of the McCol1 building the rehabi7.itation wi7.1 3.nclude direct con-
nections to the atrium that is comprised o,f the main retail rel,ement of Galti�r
P1aza. The issuance of the tax exempt mort�age does not put the Port Autho�*ity
at risk since it is not in any way guaranteeing �or ass_uring �hat the �5.1
mil3ion will be repaid.
Finanzial�, Budgetary and Personr�el Impacts Anticipated: �
N�A � RECEivE�
. � . . . . . r���'.'��1 r� . .. � .
. . . ��L, � ..
Fundi ng Source and Furrd Acti vi ty Nu�er Charged or Credited:
N/A � A�ORNEY
Attachm�nts (List and Number all Attachn�ents):
�
Staff Memorandum
Draft City Counci�. Resol.ution _
Port Authority Resolution No. 2163 :
DEPARTMENT REYIE41 CITY ATTORNEY REYIEW
X Yes No Council Resolution Required? Resolutioi;n Required?' X Yes No
Y�s X No Insurance Required? Insuranca Sufficient?� Yes � No
Yes �lo Insurance Attached? '
cc: R. Thorpe
Revision �of October, 19�2
(SpP RevarsP Si�ip f�r 'Instructions)
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��1�s�
` ' � Resolution No. .� /�:,j
RESOLUTION OF .
TIiE PORT AUTHORZTY O�' TI3E CITY OF SAINT PAUL
WHEREAS, the purpose of Chapter 474, Minnesota
Statutes, known as the Minnesota t�lunicipal Industrial Develop-
ment Act (hereinafter called "Act" ) as found and determined by
the legislature is to prornote the welfare of the state by the
active attraction and encouragement and development of economi-
cally sound industry and commerce to prevent so far as possible
the ernergence of blighted and marginal lands and areas of
chronic unemployment and to aid in the development of existing
areas of blight, rnarginal land and persistent unemployment; and
WHEREAS, factors necessitating the active promotion
and development of economically sound industry and cortunerce are
the increasing concentration of population in the metropolitan
areas and the rapidly rising increase in the amount and cost of
gover:unental 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 �ity of Saint Paul
(the "Authority") has received from Mears Park Associates
(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 and renovation of the
McColl Building located at the corner of Fifth and Jackson
Streets and the construction of approximately 26, 000 square
feet of office space on floors six and seven of the Galtier
Plaza (other portions of which were �reviously financed by the
issuance of Port Authority revenue bonds) (hereinafter
collectively called the "Project" ) in the City of St. Paul, all
as is more fully described in the staff report on file; and
. 2�1 os"7
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 op�ortunities 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
WHER�;AS, the Project to be financed by 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 b�sis 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 with the aid of revenue bond financing, and its
resulting low borrowing cost, the Project is economically more
feasible;
WHER�:AS, the Company has received a commitinent from a
local financing institution (the "Bank" ) relating to the
purchase of the revenue bonds to be issued to finance the
Project;
WHEREAS, the Authority, pursuant to Minnesota
Statutes, 5ection 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
�7HERERS, the Authority did conduct a public 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 A:ithority of the City of Saint Paul, Minnesota as
follows:
� � � � � 2�10�'�
1. �On the basis of information available to the
Aut2iority 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 la of Section 474.�2
of the Act; that the Project furthers the purposes stated in
Section 474.01 of the Act, that the availability of the
financing under the Act and willingness of the Authority to
furnish such financing will be a substantial inducement to the
Company to 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 help the
City to retain and improve its tax base and provide the range
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 rnore 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 Bank as to the details vf 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
$5 , 100,000 .(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
Comrnissioners which was presented to the Commissioners, are
incorporated herein by reference and approved.
3 . In accordance with Subdivision 7a of Section
474.01, 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 Commissionpr of
Securities, 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. �
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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. The form of said Agreements have
been examined by the Commissioners. It is the purpose of said
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 cortunencement of
the acquisition, installation and construction of the Project
with the assurance that there has been sufficient "official
" action" under Section 103 (b) of the Internal Revenue Code of
1954, as amended, to allaw 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 are authorized and
directed to continue negotiations with the Company so as to
resolve the remaining issues necessary to the preparation of
the revenue agreement and other documents necessary to the
adoption by the Authority of its final bond resolution and the
issuance and delivery of the 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
� 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 tnay request.
• • � ������
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8. 'I'he 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 Securities, 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 July 5, 1983 /
7 '
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Attest , ,/ c- �i�::.
Pr
� ,;� The Po t Authority of the City
/ / J: ,�: of S nt Paul
- �'
�����,� �, ���•/�ii;���
Secretary '
�
� R�O R T . , - . 2�1��'7
° AUTHORITY
OF THE CITY OF ST. PAUL
Memorandum
TO: Board of Commissioners . DATE: July 1, 1983
',
4 -
FROM: E. A ���
SUBJECT: PRELIMINARY AGREEMENT WITH MEARS PARK ASSOCIATES
(GALTIER PLAZA) PRIVATELY PLACED TAX EXEMPT MORTGAGE
TO FINANCE MC COLL BUILDING AND GALTIER PLAZA OFFICE
SPACE - $5 ,100 ,000
RESOLUTION N0. 2163
The Mears Park Partnerships have negotiated the purchase of
the McColl building and have secured the financing for 26,000
square feet of office space on floors 6 and 7 of the Galtier
Plaza.
In the original proposal the site of the former Mears building
was to contain 60 ,000 square feet of office space in addition
to space on floors 3 through 5 in Mears Park which wi11 contain
34,100 square feet of office space. -
Prior to the recommendation to the Board to finance the Mears
Park project , the overall office space was reduced from 90,000
square feet to 60 ,000 square feet . The Mears Park West Partner-
ship and the proposed 6th and 7th floor expansion contained in
this memo wi11 contain 26 ,000 square feet to equal the original
60 ,000 square feet previously approved by the Port Authority.
That previous approval did not , however, contain financing of
the 26 ,000 square feet .
With the acquisition of the McColl building, which is currently
80� occupied, the rehabilitation will include direct connections
to the atrium that is comprised of the main retail element of
Galtier Plaza.
The Mears Park Partnerships have negotiated a private placement
with a local financial institution based upon a 30-year lease
with a 10-year put .
A11 of the other elements of the Mears Park project are
financed and the syndication has been completed to put in place
the necessary equity participation which was pledged under the
agreements with the Port Authority , Lowertown Redevelopment
Corporation, and the City of St . Pau�.
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� • � 2�1��"'1
Board of Cmmissioners
July l, 1g83 �
Page -2-
. The terms of the lease und�r this $5 ,100,000 bond issue will
encompass 30 years with interest only on the debt for the
first five years and principal and interest payable for the
� last 25 years . The rate of interest will be est ablished by
the financial institution with whom the placement is being�
made.
The issuance of the $5. 1 million does not put the Port
Authority at risk since the Port Authority is not in any way
guaranteeing nor assuring that the $5. 1 million will be repaid.
An ' as completed' appraisal of the remodeled McColl building
and t he 26,000 square feet of office space indicates a value
of $6. 8 million.
Under the terms of the lease the Port Authority will charge
fiscal and administrative fees on the proj ect based upon the
following scheduled:
. �2% per million per month for the first 10 years $21, 420�year
. 54% per million per month for the second 10 years 27 ,540/year
. 66q per million per year for the final 10 years 33,600/year
The Port Authority will also retain all earnings on the sinking
fund and the rental shall be paid monthly in advance.
Th contract wi11 also provide that the developers will comply
with all local and federal affirmative action and the Port
Authority' s set aside program prior to commencement of this
construction proj ect .
The actual interest rate and terms of the bank agreement will
be available on the date of sale .
In the bank' s evaluation they have considered the significant
amount of equity already in the project from the Partnership ,
Lowertown Redevelopment , the UDAG grant , and the City of St .
Paul to be adequate equity to warrant a loan for the total
cost of the project . The borrowing also will be secured by
appropriate letters of credit .
St aff recommends approval of the preliminary agreement based
upon the terms set forth above.
EAK:j mo
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�' �'. '�..� �IZ`Y OF ►SAIN7` PAUL
�I�_ �
�••� OI`FICE OF TFiIC CITY COUI�TCIL
,�,;.�;:...:,.�
- '�:Iis+�or-; �
"-'�""`�-��- D a t e ; October 20, 1983
,,��
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� ����� COMMITT � E RE PORT
� ,
..;:-.>�. .�, .
��;;: ;T; = Sq�nt Pau I City Council
� 1 1 q�
:.j''��} •�'t � M � �:O�Y11111r t@@ O h Finance, Management � Personnel
;�'.�;�i, `
�---- CHAIR Councilman Scheibel
-�-- �
_ . _ _ �_ - ---—__ --------- - —------ . .-—- -. .�.
� 1. Resolution recommending additions to 1983 budget, Library Grants Trust Fund,
in th� amount .of $S0,000. (Co�luiity Services) �
� 2. Resolution recommending additions to 1983 budget, Library Special Revenue Fund,
in the amount of $16,227. (Community Services) �
�' 3. Resolution recommending additions to 1983 budget, Interlibrary Loan Fund, in
the amount of �24,000. (Community Services) �.
�4. Resolution amending 1980 Capital Improvement Budget _for St. Anthony Hill
Sewer Rehabilitation and rtinnehaha Avenue Curbing. (Public t�'orks) �
� . ._ _ _� __
�" 5. . Resolution recommending additions to 1983 budget, Rietzke Niemorial TYust I=und,
779.00. (Community Services) � .
� 6. Resolution transferring $124,645 from Contingent Reserve Specified into the
Building 'Irades Fringe Benefits. (Finance �, Aianagement) �`p-°��."�'
� 7. Resolution transferring $328.31 from 1980 CIB Fund. Will enabie City to
close out Energy Audit Grant. (Community Services) � �
8. Resolution authorizing the filing of an application for an Urban Development
Action Grant. (PED) �
9. Resolution transferring �35,000 in the 1983 General Fund Budget to Public
Utilities Investigation Fund, Cable TV - Legislative. (Council Research)
��
10. Ordinance amending Section 33.04 of the Saint Pau� Legislative Code. (Comm. Services)
. � --- -- - _ .. - - .. . __-. __ .
11. Ordinance allowing the Division of Valuations and Assessments to .charge a fee
for providi_no pending and current assessment searches. (Finance � Dlanagement)
�
12. Resolution for issuance of revenue bonds in the amount of $5,100,000 to finance
the acquisition of the hfcColl building and construction of office space at.
Galtier Plaza. (Port Authority) �
13. Discussion regarding civil service reclassification of Roseanne D'Agostino.
"'0 ,�:.�i�`,:,7,� ��
CIT'Y HALL SEVENTH FLOOR SAINT PAUL, MINNESOTA 55102
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