Loading...
277286 WMITE - CITY CLERK PINK - FINANCE COUI1C11 CANARY - DEPARTMENT G I TY O F SA I NT PA U L � BLUE - MAYOR File N O. b ` } - �'`^j�� u ci Resolution Presented By Referred To Committee: Date Out of Committee By Date WHEREAS: 1 . On July 28, 1981 , the Port Authority of the City of Saint Paul adopted Resolution No. 1851 , giving preliminary approval to the issuance of a Tax Exempt Mortgage in the initial principal amount of approximately $1 ,085,000 to finance the construction of a 20,000 Sq. Ft. , two-story office and warehouse irnrnediately east of their facility on the Lafayette Frontage Road South of Plato Boulevard. 2. Laws of Minnesota 1976, Chapter 234, provides that an.y Tax Exempt Mortgage No�te 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 accord�ance with law; 3. The Port Authority of the City of Saint Paul has requested that the City Coun�cil give its requisite consent pursuant to said law to facilitate the issuance of said Tax Exempt Mortgage Note by the Port Authority of the City of Saint Paul , subject to final approv.al of the details of said Note by the Port Authority of the Gity- 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 t�ue aforesaid Tax Exempt Mortgage Note for the purposes described in the aforesaid Port Authority Resolution No. 1851 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 b y the Port Authority, and the City Council hereby authorizes the issuance of any addi'tional 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. COUNCILMEIV Requestgd by Department of: Yeas Nays � Hunt Levine In FavOr Maddox �) McMahon �V� B Showalter A gai n s t Y Tedesco �Ison AIIL' 1 ��T Form Approve y Ci ttorney < Adopted by Council: Date $ Certified Y•s-e by Council creta By By v Appr b :Vlavor. Date A ov by Mayor f u micsion to Council By _ PUBCISHED AU G 2 y 1981 � P �� R T r:::::;:: ;`:� ��::. AI�� THORITY ���c�� OF THE CITY OF ST. PAUL Memorandum T�: BOARD OF COMMISSIONERS DAT� July 28, 1981 (Meeting July 28, 1981 ) FROM: Donald G. Dunshee SUBJECT: PUBLIC HEARING - SALE OF TAX EXEMPT MORTGAGE NOTE PRELIMINARY AND UNDERWRITING AGREEMENT DURINO PARTNERSNIP SUBLEASE TO COLLINS COMMUNICATIONS SYSTEMS C0. $1 ,085,000 TAX EXEMPT MORTGAGE NOTE - RIVERV�IEW INDUSTRIAL PARK RESOLUTION N0. 1851� PUBLIC HEARING - SALE OF LAND DURINO PARTNERSHIP SUBLEASE TO COLLINS COMMUNICATIONS SYSTEMS C0. RESOLUTION N0. 1852 1 . The Company Collins Communications Systems Co. was started in 1930�and was purchased in 1948 by Mr. William Collins, President of the Company. The Company began business as an electrical contractor and is still involved in general commercial and industrial electrical construction activity. . In 1974 the Company formed a communication systems division that is involved in selling private telephone systems in the Twin City Met- ropolitan area. That division presently employs more than 80 peopl� and customers include the First National banks of both St. Paul and Minneapolis, Jelco Corporation, IDS, Piper, Jaffray & Hppwood Incor- porated, Pako and many other businesses throughout the area. 2. The Project The Port Authority in 1969 sold a three acre site to Collins Communications Systems Co. on which they constructed their own building with private financing. That building was expanded in 1979 to accommodate the growth of the communications division. The Company proposes to construct a 20,000 Sq. Ft. , two-story office and warehouse immediately east of their present facility on the Lafayette Frontage Road south of Plato Boulevard. � ..... ..-:.. . s°`::::' � _.. . _.... BOARD OF COMMISSIONERS COLLINS COMMUNICATIONS SYSTEMS C0. July 28, 1981 Page 2 3. Financing The proposed financing would be done under a tax exempt mortgage note by American National Bank to the partnership with a sublease to the Corporation. The mortgage would have a 20 year amortization schedule with a ten year balloon. Proceeds from the bond issue would be as follows: Land $ 128,985.00 Construction 870,250.00 Bond Issue Expense 14,115.00 Capitalized Interest - 6 Months 66,000.00 Discount 5,650.00 1 ,085,000.00 In addit�ion to the monthly rent the Company will pay the customary fiscal and administrative fee based on the formula of .36� per million per year for the first 10 years and .48% per million per year for the second 10 years of the tax exempt mortgage. 4. Underwriting American National Bank has agreed to purchase the mortgage with a floating interest rate at one-half of the American National Bank's prime rate plus two points. 5. Term of the Lease The site ccntains 74,991 Sq. Ft. and is located approximately 500 feet south of Plato Boulevard on the west side of the Lafayette Freeway. The contractor has determined from soil tests it will cost �50,000 far piling, pile caps, grade beams and other reinforcements necessary to support the building. We propose to adjust the land price from $2.00 per Sq. Ft.. to $1 .72 per Sq. Ft. to help offset that expense. The site would be sold at a cost of $128,985.00. --.. - - 6. Recommendation Staff has reviewed the project, the financial statements of the partner- ship and the Corporation and reco�nends approval of Resolutions 1851 and 1852. sjs �, . .� � `�..- =....... �'�,,`��� Resolution i1o. 1851 , RESOLUTION OF THL PORT AUTHORITY OI' THE CITY OF SAINT PAUL L•7HEREAS, the purpose of Chapter 474, Aiinnesota . Statutes, known as the Minnesota i�iunicinal Industrial Develop- � ment Act (hereinafter called "Act" ) as found and determined by the legislature is to promote the ��elfare 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, narginal land and persistent unernployr�lent; and ��'HEI2EAS, factors necessitatiny the active promotion and developrnent of economically sound industry and commerce are the increasing coiicentration of �opulation 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 developr��ent of land use which will provide an adequate tax base to finance these inereased costs and access to enployment opportunities for such population; and Z�7FiEREAS� The Port Authority of t7ie City of 5aint Paul (the "Authority" ) has received from Durino Partnership, a Minnesota general �artnership corzprised of �7illiam N. Collins, William Heggelman and Raymond M. Barzy (hereinatter referred to as "Company" ) a request that the Authority issue its revenue bonds, in the form of a single note to finance the acquisition, installation and construction of a 20, 000 square foot two-story , office and warehouse building (hereinafter collectively called � the "Project" ) in the City of St. Paul, all as is nore fully described in the staff report on file; and �JfiEREAS, the Authority desires to facilitate the selective development of the community, to retain and imnrove 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 ' r ' . 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 WHEREAS, the Project to' be financed by revenue bonds will result in substantial employment opportunities in the Project; � WFiE�AS, the Authority has been advised by repre- � sentatives of the Company that conventional, comriercial 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 F�roject would be significantly reduced, but tYie 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; � WHERr:AS, Miller & Schroeder t�lunicipals, Inc. (the "Placement Agent" ) has made a proposal in an agreement (the . "Placement Agreement" ) relating to the purchase of the revenue bonds to be issued to finance the Project; ��JHEREAS, the Authority, pursuant to Miiinesota Statutes, Section 474 .01, Subdivision 7b did publish a notice, a copy of ��hich with proof of puUlication is on file in the office of the Authority, of a public hearing on the proposal o£ the Company that the Authority finance the Project hereinbefore described by the issuance of its industrial revenue bonds; and F7�iEREAS, 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 �aere given an opportunity to eapress their views with respect to the Proposal. � NOS•�, THLREFOI2E, BE IT RESOLVEll by the Comnissioners of the Port Authority of the City of Saint Paul, Minnesota as follo��s: � 1. On the basis of information available to the Authority it appears, and the Authority 3�ereby finds, that said Project constitutes properties, used or useful in connection . - . �::=:. ��:_: � � � 7 �a � � with one or more revenue producing enterprises engaged in any business within the meaniny of Su2xlivision 1 of Section 474.U2 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 mover.�ent of talented � � and educated persons out of the state and to areas caithin the . . state where their .services may not be as effectively used and will result in rr�ore 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 Paui and in furtherance of the general plan of development to assist the Company in financiny the Project. 2. Subject to the mutual agreeme:�t of the Authority, the Company and the �ourchaser of the revenue bonds as to the details of the lease or other revenue agreernent as defined in the Act, and-..ot�er docwnents necessary to evidence and effect the financing of the Project and the issuance of the revenue bonds, the Project is hereby apyroved and authorized and the issuance of revenue bonds of the Authority, in the form of a single note, in an amount not to exceed approxiiaately $1, 085, 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 Auth�rity' s staff, as set forth in the staff inemorandum to the Commissioners w'nich 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 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. 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 Placement , �� �, _ _...- � �� �� �� � 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 int�entions with respect to the proposed Project in order that the Company may proceed �vithout 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 anended, to allow for the issuance of industrial revenue bonds (incluciin3, if deemed appropriate, any interim note or notes to provide temporary financing thereof) to finance the entire cost of the Project upon ayreement 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 �vith 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 bon3 resolution and the . issuance and delivery of the note. 6. The note (including any interim note or notes) and interest thereon shall not constitute an indebtedness of the Authority or the Ci=�y -of Saint Paul within the meaning of any constitutional or statutory limitation and shall not constitute or give rise to a �ecuniary 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 note (and interim note or notes) or interest thereon. 7. In order to facilitate completion of the revenue bond financiny herein co:ztemplated, the City Council is hereby requested to consent, pursuant to Laws of Minnesota, 1976, Cha�ter 234, to the issuance of the Note (includiny any interim note or notes) herein contemplated and any additional bonds ' which the Authority nay prior to issuance or from time to time thereafter deem necessary to complete the Project or to refund _ such revenue bonds; and for suc2i purpose the Executive Vice , '::::. ,.:::.. / - �. ` . _.. ' �_.::�� � � 7 �� � � � ' ' President of the Authority is hereby authorized and directed to forward to the City Council co�ies of this resolution and said Preliminary Agreement and any additional available information 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 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 tne office of the Authority from and after the publication of notice of the hearing, are in all respects ratified and confirmed. , . ,' Adopted July 28, 1981 . Attest � Pre 'de t T e Po t Authority of the City of Saint Paul � � � retary _ .�*--� �' Councilman George McMahon '� r' �` Room 716 Ci ty Hal l ;; ;: St. Paul , Minn. 55102 � , �'��'�� '° �•c,1 .r �� � � PORT AUTHORITY OF THE CITY OF SAINT PAUL � 25 WEST FOURTH STREET • SUITE 1305 • ST. PAUL, MINN. 55102 • PHONE (612) 224-5686 July 28, 1981 Mr. James Bellus Director Planning and Economic Development Department City of St. Paul 14th Floor, City Hall Annex St. Paul , Minnesota . 55102 � SUBJECT: DURINO PARTNERSHIP (SUBLEASE TO COLLINS COMMUNICATIONS SYSTEMS C0.) $1 ,085,000 TAX EXEMPT MORTGAGE NOTE Dear Jim: � We submit herewith for your review and referral to the office of the Mayor, City Council , and the City Attorney's office details pertaining to the issuance of a tax exempt mortgage note to finance the construction of a 20,000 Sq. Ft. , two-story office and warehouse for Collins Communications Systems Co. In addition to the staff inemorandum, we are attaching a draft copy of the proposed City Council Resolution and a copy of Port Authority Resolution No. 1851 which authorized the sale of the note in .the amount of $1 ,085,040. Your expeditious handling of this matter will be appreciated. urs truly, gene .A. Kraut Assistant Executive Vice President EAK:sjs cc: R. Broeker �OBERT F.SPRAFKA EUGENE f�KRAU1,C.I.D. DONALD G.DUNSHEE,C.I.D. CLIFFORD E.RAMSTED ROMALD O.SCHETfLE xECUfNE viCE PRESIDEM ASSISIAM EXECUINE VICE PRESIDEM dRKTOR.INpU5iRW1 pEVE�ppA4EM CNiEF ENGINEER CMIEi ACCOUMAM �OMMISSIONERS GEORGE W.WINTER GEORGE R. MCMAHON ARTHUR N.GOODMAN VICTOR P. REIM JE4N M.WEST WILLIAM WILSON WIILIAM J.SEIFERT oRE51DEM V10E PRE9DEM SECREIARV TREASURER `�?0 7 C.I.D. Certified Industrial Developer � � � OM Ol : 12/1975 . Rev. : 9/8/76 EXPLANATION OF ADMINISTRATIVE ORDERS, r' � �P� �/` /3� RESOLUTIONS, AND ORDINANCES � - � : RECEIVED �ate: �uly 2s, 1 gsl AUG 4 1981 MAYORS UFFICE TQ: MAYOR GE LATIMER . FR: E. A. Krau , . aul Port Authority � � RE; DURINO PAR NERSHIP UBLEASE TO COLLINS COP�IUNICATIONS SYSTEMS C0.) �1 ,085,000 TAX EXEMPT MORTGAGE NOTE ACTION REQUESTED: • In accordance with the Laws of�Minnesota, Chapter 234,. it is requested that the City Council, by Resolution, a draft copy of which is attached hereto, approve the issuance of a $1 ,085,000 tax ex�npt mortgage note to finance the constructi of a Z0,000 Sq. Ft. , two-story office and warehouse imnediately east of their ' present facility on the Lafayette Frontage Road south of Plato Boulev�rd. PURPOSE AND RATIONALE FOR 7HIS ACTION: � Tfie purpose of. the tax exempt mortgage is to finance the construction of a 20,00 : Sq. Ft. , two-story office and warehouse for the expansion of their communication systems division that is involved in selling private telephone systems in the Tw n : City Metropolitan Area. That divisio.n presently employs more than 80 people and customers include the First National banks of both St. Paul and Minneapolis, Je1 0 Corporation, IDS, Piper, Jaffray & Hopwood Incorporated, Pako and many other bus inesses throughout the area. When completed, it is estimated that 2Q persons wi 1 be employed in the facility and it will generate an estimated �300,OQ0.40'�;' in ta es for the City. ATTACHMENTS: Staff Memorandum � � Draft City Gouncil Resolution Port Authority Resolution No. 1851 ....._._ CI'�Y OT'' �Ai1,"'T' �A'UL �• � •- �' �.y O�+�F�ICE OF THi CITY COUNCxL � �--^� - ����� e.-�' ,�.;� .�v � P.'!�'N-�;�.+ �.• 1S� ��Jy��J� . ,�' . . �� .�►!�y Y['��� �� � . - .o- . pq t e ; August 13, 1981 r� �4: C � � � i � 1 � � � � '�' 0�`T'�- . Tp : Sain� Pout . City Council . : - . . 3 F R O� • C O Jl���3�e� O�1 FINANCE, MANAGEMENT & PERSONNEL _ . George McMahon � chairman, makes the fot lowing � . prdinance reporP on� C.F. � -� . (4} [� Resotution . . C] Other T �TLE : � - . , At its meeting of August 13, 1981, the Finance Committee recommended approval __ of the following: : -. _ � ' l, Resolutiori approving issuance of a $1,085,000 tax exempt mortgage note by the Port Authority to finance construction of two-story office and warehous� on ' ; Lafayette Frontage Road for Durino Partnership (Sublease to Collins Communicatians� Systems Co.) (12174-McM) 2, Resolution approving issuance of revenue bond by Port Authority for approxima�ely $1,520,000 to finance construction of office building and shop facility in � Riverview Industrial Area West for Carl Bolander & Sons Co_ (12173-McM) 3. Resol,ution approving execution of City/School District Operating Agreement for 1981. (Requested by Finance Department) (�121S9-McM� ' 4. Resolution approving collateral pZedged by Summit National Bank to protect city funds held in said bank. (Requested by Finance Department) (12178-McM) C�y ���, SEVE?tiTH FLOOR SAI�IT PAUL, titl��iESOT.� SSIO? � ::.�;,� .