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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 �" [n Favor Masanz � Nicosia scr,eibei _ o __ Against BY� '������'"' ` ��- 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 7-d '�S� � A d by (Vlavor. t r _~UG � 1983 A r ve y Mayor for Su 'ssi n t � •,�,,ai, �` `��,,�---�. By — Y - pilgLtSNED AU G 13 1983 � ���� � 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. �v��;rav� • �rJ��� r . 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�� . • ` � _ 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)