280693 wHITE - CITY CLERK COUflCll ����I��fl�
PINK - FINANCE G I TY OF SA I NT PA V L
CANARV - DEPARTMENT 7�w � Y
BLUE - MAVOR File NO.
� � C u cil Resolution
i
Presented By
Referred To Committee: Date
Out of Committee By Date
WHEREAS:
1. On July 19, 1983 the Port Authority of the City of Saint Paul adopted Resolution
No. 2166 giving preliminary approval to the issuance of a tax exempt mortgage note in the
initial principal amount of $200,000 to finance the acquisition of the W.W. Grainger
Building in Riverview Industrial Park by the John F. Tracy partnership which is comprised
of John F. Tracy, Patrick M. Tracy, Winnifred M. Tracy and James T. Tracy. The
partnership will then sublease the building to Graybar Electric. Miller and Schroeder
Municipals has provided a placement agreement for the Tracy partnership.
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. 2166 the exact details of which, including, but not limited to, provisions
relating to maturities, 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 purposes for which the aforesaid bonds are
issued.
COUNCILMEN
Yeas Nays Requested by Department of:
Fletcher
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Masanz �
Nicosia
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Tedesco
Wilson
AI��± � �ro� Form Approved by City Attorney
Adopted by Council: Date 11u i�__— ��
Certifie ss�d by un ' S cre y " v �
By, A
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A d by (Vlavor. t r _~UG � 1983 A r ve y Mayor for Su 'ssi n t
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pilgLtSNED AU G 13 1983 �
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� ORT
AUTHORITY '
OF THE CITY OF ST. PAUL
Memorandum
TO: BOARD OF COMMISSIONERS DATE: �uly 14, 1983
(July 19, 1983 Regular Meeting) .
FROM: B.A. Mau
SUBJECT: GRAYBAR ELECTRIC (JOHN F. TRACY)
$200,000 TAX EXEMPT MORTGAGE NOTE
PUBLIC HEARING
ACQUISITION OF W.W. GRAINGER BUILDING
RIVERVIEW INDUSTRIAL PARK
RESOLUTION N0. 2166
1 . THE CONIPANY
Graybar Electric is one of the largest electrical equipment and supply
wholesale companies in the United States. Sales of Graybar in 1982
were approximately $1 .5 billion. Graybar will sublease the W.W. Grainger
bu�lding in Riverview Industria1 Park from a Minnesota general partnership
composed of John F. Tracy, Patrick M. Tracy, Winnifred M. Tracy and
James T. Tracy. This will be a newly formed partnership with each
partner having a 25% interest.
2. THE PROJECT
W.W. Grainger has listed their building in Riverview for sale during
the past year. Graybar Electric, located at 366 Dayton Avenue in
St. Paul , is being required to relocate due to condemnation proceedings.
The company has been considering a site outside of St. Paul .
3. TERhiS OF THE AGREEMENT
The Tracy partnership has obtained a financing commitment from Liberty
State Bank of 176 Snelling Avenue in St. Paul in the amount of $200,000.
The building is being acquired at a price of $290,000; the $90,000 balance
is in the form of cash equity.
The Port Authority will collect its normal fiscal and administrative
fees on the tax exempt mortgage.
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• �rJ���
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BOARD OF COMMISSIONERS
July 14, 1983 .
Page -2-
4. RECOMMENDATIONS
In view of the fact that this issue does not pose a financial risk to
the Port Authority, includes a national company that will sign a lease
for five years and keep the company in St. Paul , staff recommends
approval of Resolution No • 2166.
BAM:ca
Attach.
, • iG�����2
� • � Resolution No. �11��'
_ RESOLUTION OF
THE PORT AUTHORITY OF THE CITY OF SAINT PAUL
WHEREAS, the purpose of Chapter 474, Minnesota _
Statutes, known as the Minnesota Municipal Industrial Develop- "
ment Act (hereinafter called "Act") as found and determined by �
the legislature is to promote t21e welfare of the state by the
active attraction and encouragement and development ot economi-
cally sound industry and commerce to prevent so far as possible
the emergence of blignted 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 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 wi.11 provide an adequate tax base to finance these
--- increased costs and access to employment opportunities for such
popul a�tion; and
WHEREAS, The Port Authority of tne City of Saint Paul
(the "Authority") has received from John F. Tracy, Patrick M.
Tracy, Winnifred M. Tracy and James T. Tracy a request that the
Authority issue its revenue bonds (which may be in the form of
a single note) to finance, on behalf of a partnership to be
formed by those persons (hereinafter referred to as "Company")
the acquisition of the W. W. Grainger facility in Riverview
Industrial Park and the renovation of those facilities for use
by Graybar Electic (hereinafter collectively called the
"Project") , all as is more fully described in the staff report
on file; and
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
' s �����
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 posi�ive 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 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 with the aid of revenue bond financing, and its
resulting low borrowir.g cost, the Project is economically more
feasible;
WHEREAS, Liberty State Bank (the "Bank") has made a
proposal in an agreement (the "Commitment") 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 t'ne Authority finance the Project hereinbefore
described by the issuance of its industrial revenue bonds; and
WHEREAS, 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 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 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 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 more intensive development and use of land
within the City and wil'1 eventually result in an increase in
the City' s tax base; and that it is in the best interests of
the port distri`�t and the people of the City of Saint Paul and
in furtherance af 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 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 $200,000
(other than su.ch 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 7a of Section
474.01, �Iinnesota 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
Energy, Planning and 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 constructian and
financing of the Project. The form of said Agreement has been
� � � � � ���s��
examined by the Commissioners. It is the purpose of said Agree-
men�t 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" under Section 103 (b) of the Internal Revenue Code of
1954, as amended, to allow for the issuance of industrial
revenue bonds to finance the entire cost of the Project upon --
agreement being reached as to the ultimate details of the
Project and its financing. Said Agreement is hereby approved,
and the President and Secretary of the Authority are hereby
authorized and directed to execute said Agreement. .
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 revene�e bonds.
o. The revenue bonds and interest t'nereon shall nQt
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 t'ne Authority or tne 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 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 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. �
. �V�a��
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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
appli�ation to the Commissioner of Energy, Planning and Develop-
ment, 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 19, 1983
Attest
President
The Port Authority of the City
of Saint Paul
� / ��. �,
C�, S cretary. �� _ � ��
� �
Port Authori ty DEPARTt,1ENT ����
B.A. Maus, E,A. Kraut r.4NTACT � � �
224-5686 PHONE
1 u]�_1 Q� 198'�
DATE �v�� �� �
(Routing and Explanation Sheet)
Assign Number for Routing Order (Clip All Locations for Ma�yoral Signature): CEIVED
� rtment Di rector JUI_ �� ;,��:v�
Ci ty Attorney / �t,CEIVt.D CITY AT
or � TORNEY
�_ Finance and Management Services Director �U L 2 6 i�83
�_ City Clerk �F�YOR� OFFICE
Budget Director
i�hat Will be Achieved by Taking Action on the Attached Materials? (PurposelRationale)_;_
The purpose for the tax exempt mort�age. note is to finance the acquisition of the
W.W. Grainger Building in Riverview Industrial Park for the John F. Tracy Partnership.
The partnership is comprised of John F. Tracy, Patrick M. Tracy, Winnifred M. Tracy
and James T. Tracy. The partnership will sublease the building to Graybar Electric.
Financial , Budgetary and Personnel Irrq�acts Anticipated:
The amount of the. tax exempt mortgage note is $�OO.,D00 and the term is for 10 years.
This project will create an additional five new jobs in St. Paul .
Funding Source and Fund Activity Number Charged or Credit�d: �
Attachments (List and Number all Attachments� :
1. Staff Memarandum
2. Draft City Council Resolution
3. Port Authority Resolution No. 2166 ,
R
DEPARTMENT REVIEW CITY ATTORNEY RE�IIEW
X Yes No Council Resolution Required? Resolution Required? X Yes No
Yes � No Insurance Required? Insurance Sufficient? X Yes _ No
Yes � No Insurance Attached?
Revision of October, 1982
(See Reverse Side for �Instructions)