277912 WHITE - CITY CLERK
PINK - FINANCE COUIICII �j '�'�� �
CANARY - DEPARTMENT G I T Y O F S A I N T PA LT L
BLUE - MAYOR File N O. ���
o cil Resolution
Presented By �
Referred To Committee: Date
Out of Committee By Date
WHEREAS:
1 . On December 15, 1981 , the Port Authority of the City of Saint Paul adopted
Resolution No. 1946giving preliminary approval to the issuance of approximately
$1 ,570,000 in revenue bonds to finance the construction of a new 20,000 Sq. Ft.
corporate office headquarters on a 70,000 Sq. Ft. site in St. Paul Energy Park for
J. L. Shiely Company;
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. 1946, 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 Requestgd by Department of:
Hunt
Levine In Favor
Maddox
McMahon a Against By
Showalter -
Tedesco
�lilww�
JAN 7 ��2 Form Ap o ed by Cit ttorney
Adopted by Council: Date
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Certified � -s by Counc' Se ry By� �
r
By �".-. -
JAN 8 �982 Appr d by Mayor fo S mis i�n to Council
Approved b Mavor: Dat
�y PUBLISHED By
JAN 16 1982
� � �ORT
� UTHORlTY ` r''
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OF THE CITY OF ST. PAUL � �_ +
Memorandum
TO: BOARD OF COMMISSIOKE DATE: December 11 , 1981
(Meeting December 15 19 )
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FROM: Donald G. Dunshee �
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�g��; PUBLIC HEARI�G - PRELI�rINARY AND UNDERWITING AGREEMENT
$1 ,570,000 REVENI;E BOND ISSUE
J. L. SHIELY CCMPAhY
RESOLUTION N0. 1946
PUBLIC SALE HEARIyG - SALE OF LAND
J. L. SHIELY CCMFANY
RESOLUTION N0. 1�47
1 . COMPANY
J. L. Shiely Company was incorporated in St. Paul in 1914 and has been
involved in the sand, gravel and ready mix business since that time.
The Company began mining sand and gravel in the area between Lexington
and Snelling that is now part of St. Paul Energy Park in 1921 and oper-
ated in tha� area until Midway Stadium was constructed in 1953. Following
the close oF their mining operation at that location they opened up an
operation at Gray Cloud Island which is still being used. Besides the
sand and gr�vel operation, J. L. Shiely Company leases land from the Port
Authority ir� Barge Terminal No. 1 where material is stockpiled and they
have a ready mix concrete operation.
2. PROJECT
The headquarters for the Company is presently located at 1101 Snelling
Avenue P�orth and because of the growth of their business they have had
to lease additional office space. The Company wishes to keep their
corporate headquarters in St. Paul and because of their strong ties to
the Energy Park area from their gravel operations, wish to relocate their
headquarters to a new site in St. Paul Energy Park. Their proposed office
building r�rould contain 20,000 Sq. Ft. and be situated on a 70,000 Sq. Ft.
site.
The Company would not start construction of the new building until the
Fall of 1982 or the Spring of 1983 depending on their construction act-
ivity for next year. Because of the fact they would not be starting
construction for at least a year the location of their proposed facility
in the Park has not been determined and final design of the building not
completed.
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3CARD OF COMMISSIONERS
. (M�eting December 15, 1981 )
J. L. SHIELY COMPANY
?dge 2
3. FINANCING .
The proposed financing would be done as an 876 industrial development
revenue bond issue witr a 30 year term. Proceeds from the bond issue
would be as follows:
Building (20,000 �q. Ft. ) $1 ,200,000
Bond Issue Expense 20,000
Capitalized InterESt 100,000
Debt Service Reserve 205,000
Discount 45,000
$1 ,570,000
In addition to the mon�nly rent the Company will pay the customary fiscal
and administrative fee based on the formula of .42% per mi7lion per year
for the first 10 years, . 54'o per million per year for the second 10 years
and .66% per million per year for the third 10 years of the lease.
The interest earnings cn the sinking fund and debt service reserve would
inure to the benefit o= the Port Authority.
' . UhDERWRITING
hiiller and Schroeder M�nicipals has agreed to underwrite the bond issue
Yrith the interest ra�e to be set at the time the bonds are sold.
�. TERF;S OF THE LEASE
The lease would be for a term of 30 years and the company would have an
o�tion to purchase az ihe end of the lOth, 20th and 30th years for 10%
of the original bond issue cost plus retirement of any outstanding bonds.
The 70,000 Sq. Ft. o� ;and would be leased at a rate of �2.25 per Sq. Ft.
plus 10% interest or ar� annual rental of $16,977.96 payable monthly in
advance in the amount cf 51 ,414.84. The Company would have an option to
purchase the land under the standard Port Authority formula at one-half
the original land price at the end of the term.
6. RECGMMENDATION
Staff has met with Cou:^.cil 46 regarding the project and they voted to support
the project providing :he Company brought the final site plan and rendering
for their review before the project commences. Staff has reviewed the
project, the officers af the Company and recommends approval of Resolution
P�o. 1946 and Resolutio� t�o. 1947.
sjs
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` Resolution No. ��y�
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 Deveiop-
ment Act (hereinafter called "Act") as found and determined by
the legislature is to promote 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 emergence of blighted 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 o£ population in the metropoZitan
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 the J. L. Shiely Company
�hereinaftPr referr�d to as "Company" ) a requAst that the
Authority issue its revenue bonds to finance the acquisition,
installation and construction of facilities for its corparate
headquarters and that the Port Authority lease land to the
Company in Saint Paul Energy Park as a site for its
headquarters (hereinafter collectively called the "Project" ) in
the City of St. Paul, all as is more fully described in the
staff report on file; and
«iEREAS, 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
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 relationshi� between assessed
valuation and debt and enhance the image and reputation of the
City; and
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WHEREAS, the Project to be financed by reve�ue bonds
will result in substantial employment opportunities in the
Project;
�VHEREAS, the Authority has been advised by repre-
sentatives of the Company that conventional, commercial
financing to pay the capital cost of the Pzoject 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 law borrowing cost, the Project is economically more
feasible;
WHEREAS, the Company has represented that it is on�.y
willing to enter into an agreement and land lease with the Port
Authority because of the Urban Development Action Grants ( "UDAG
Grants") made and to be made by the United States Department of
Housing and Urban Development for the land acquisition, site
and public improvement, and other related costs incurred and to
be incurred by the Port Ruthority for Saint Paul Energy Park
and that the Company would not have agreed to undertake the
Project contemplated by this Resolution but for said UDAG
Grants;
WHEREAS, Miller & Schroeder Municipals, Inc. (the
"Underwriter" ) has made a proposal in an agreement (the
"Undexwriting Agreement" ) relating to the purchase of the
revenue bonds to be issued to finance the Project;
Tn1HEREAS, 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 tha Auth�rity finaiice the Project hereinbefore
described by the issua�rce of its industrial revenue bonds; and
VIHEREAS, 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 CorRmissioners
of the Port Authority of the City af Saint Paul, yinnesota 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 la of Section 474.02
of the Act; that the Project furthers the purposes stated in
Seetion 474.01 of the Act, that the availability of the
financing under the Act, the willingness of the Authority to
furnish such financing, and the UDAG Grants 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
unemplcyment, 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 serviGes
may not be as effectively used and will result in more
intensive development and use of land within the C.ity 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 Praject. •
2. Subject to the mutual agreement of. the
Authority, the Company and the purchaser vf the revenue bonds
as to the details of t'ne lease or other revenue agreement as
defined in the Act, and other documents necessary to evidence
and effect the financing of the Project and �he issuance of the
revenue bonds, the Project is hereby approved and authorized
and the issuance Qf revenue bonds of the Authority in an amount
not to exceed approximately $1,570,000 (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 Commissioners which was presented to
the Commissioners, are incorporated herein by reference and
approved.
3. In accordance with Subdivision 7a of Section
474.01, P9innesota 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
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 and a form of the Underwriting
Agreement. 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 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
(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 Prel.iminary Ayreement by
the Company, the staff of the Authority are authorized and
3irected to continue negotiations with the Company so as to
resolve the remaining issues necessary to the preparation of
the lease and other documents necessary to the adoption by the
Authority of its final bond resalution and the issuance and
delivery of the revenue bonds; provided that the President (or
Vice-President if the President is abserit) 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
Undezwriters 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 s.hall 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 Pau1 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.
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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 no�es) 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 Agreemen� and any
additional available information the City Council may request.
8. The acti.ons of the Executive Vice-President of
the Authority in causing public notice of the publa.c 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.
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Adopted December 15, 1981
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Attest ' ' `�/ "'"'" ; ,`
I
President r
The Port :Authority of the City
of Saint Paul .
Z ? �'l2le'�
S retary
. . S' ` ;, . ,c �, .�-� �8�-�
� � OM al : � 1975
; , Rev. : 9/8/76
EXPLANATION OF ApMIMISTRATTYE ORDERS, �yr�
RESOLUT.IONS, AN� ORQINAWCES /r r t /9��
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oa�e: ue��n�r �5, i�a� � R�CEIVED
ut� 21 1981
TQ: MAYOR G GE LATTMER MAYQRS OFFICE
FR: Eugene A. St aul �Port Authori ty � -
�E: J. L. SHI LY COMPANY
$1 ,570,0 0 REVENUE BOND ISSUE
ACTION REQUESTED: • �
In accord�nce with the Laws of Minnesota, Chapter 234, it is r�equested that the
� City Council , by Resolution, a draft copy, of which is attached hereto, �pprove
the issuance of approximately $1 ,570,000 in revenue bonds to finance the construction
of a 20,000 Sq. Ft. office building on a 70:,000 Sq. Ft. si�e in St. Paul Energy Park
for J. L. Shiely Company. This facility would serve as their corparate headquarters
which is presently located at 1101 Snel1ing Avenue North and is no longer adequate.
The Company wishes to keep their corporate headquarters in St. Paul . �hey have a
sand and gravel operation at Gray C]oud Island and also lease land fror� the Port
Authority in Barge Terminal No. 1 where material is stoekpi.led and they have a ready �
mix concrete operation. `
PURPO�E AND RATIONALE FOR THIS ACTION: � �
The purpose of the bond issue is to permit J. L. Shiely Company to relpcate their
corporate headquarters in St.' Paul Energy Park where they have strong ties because
of their gravel operations in that area b�tween 1921 and 1953. The Co�pany is
involved in the sand, gravel and ready mix business and apprvximate1y .lU new jobs
will be created as a result of this project. The Shiely facility will meet all the
conditions contained in the Energy Park Master Plan and wi11 go through the �esign
review process as pravided in the Energy Park Master Plan,
ATTACHMENTS:
Staff Memorandum
Draft City Council Resolution
Port Authority Resolution No. 1946
c�: R. Thorpe, Manpower Services