275948 WHITE - CITY CLERK 2�5948
PINK - FINANCE COl1I1C11
BLUE RY _ �PEnPAOR�TMENT G I T Y O F S A I N T PA U L
City Attny/SDM � � File NO.
C uncil Resolution
Presented By �
Referred To Committee: Date
Out of Committee By Date
RESOLUTION RECITING A PROPOSAL FOR A FINANCING
PROGRAM FOR A A'tULTI-FAMILY HOUSING DEVELOPMENT,
GIVING PRELIMINARY APPROVAL TO THE PROJECT AND
THE PROGRAM PURSUANT TO MINNESOTA STATUTES,
CHAPTER 462C, AND AUTHORIZTNG THE HRA TO
EXERCISE THE POWERS CONFERRED ON THE CITY BY
MTNNESOTA STATUTES, CHAPTER 462C, (TED GLASRUD
ASSOCIATES, INC./CHILDRENS HOSPITAL PROJECT)
WHEREAS,
(a) Minnesota Statutes, Chapter 462C (the "Act") authorizes
cities, or housing and redevelopment authorities authorized by
ordinance to exercise on behalf. of a city the powers conferred
by the Act, the power to issue revenue bonds to finance a program
for the purpose of planning, administering, making or purchasing
loans with respect to one or mare multi-family housing develop-
ments within the boundaries of the cit�;
(b) The Housing and Redevelopment Authority of the City of
Saint Paul, Minnesota (the "HRA") has been designated, by ordi-
nance, to exercise, on behalf of the City of St. Paul, IIZinnesota,
(the "City") the powers conferred by Minnesota Statutes, Section
462C.01 to 462C.08, upon specific Program Approval by the City
Cauncil;
(c) The HRA has received from Ted Glasrud Associates, Inc. ,
a Minnesota corporation and Childrens Hospital, a P�innesota
Limited Partnership, (collectively the "Developer") a proposal
that the HRA undertake a program to finance a Program hereinafter
described, through the issuance of revenue bonds (which may be in
the form of a single debt instrument) (the "Bonds") pursuant to
the Act;
COUNCILMEN Requestgd by Department of:
Yeas Nays f�
Hunt �,,,�,,,�J ���,,� �
Levine IR Favo[ -c���'�`°T—T ��l
Maddox
McMahon B
Showalter __ Against Y
Tedesco
Wilson
Form Approved by City Attorney
Adopted by Council: Date
Certified Passed by Council Secretary BY
By
Approved by :Vlayor: Date _ Approved by Mayor for Submission to Council
By _ BY
. �E��48
-2-
(d) The City desires to: �acilitate the development of
multi-family housing within the community, encourage the develop-
ment of affordable housing opportunities for residents of the
City; and prevent the emergence of blighted or underutilized
land and structures within the boundaries of the City; and the
Program will assist the City in achieving these objectives.
(e) The Program is to znake or purchase znartgage loans to
finance the acquis�tion of condominium units by individuals or
famil�es in the 59 unit condominiuTn conversion project at
Children's Hospital pursuant to Minnesota Statutes, Section
462 . 05, Subdivision l (d) , and that the Program will result in
the provision of additional housing opportunities to persons
within the community;
(f) The City has been �,dvised by representatives of the
Developer that convention�l, commercial financing to accomplish
the program is a,vailable only on � limited basis and at such
high costs of borrowa.ng that the economic feasibility of
operating the Program would be significantly reduced, but the
Developer ha,s also advised the City that with the aid of
municipal fin�,ncing, and resulting low borrowing costs, the
Program is econoanically more feasible;
(g) Pursuant ta a resolution of the City adopted on November
6, 1980, a pzogram for financing the Program has been dra�ted,
a public hearing on the Program was held on November 18, 1980,
after notice was published, all a,s required by Minnesota Statutes,
Section 462C.05, subd. 5, at which public hearing all those
appearing at said hearing who desired to speak were heard;
(h) No public officia,l of the HRA or the City has either a
direct or indirect �inancial interest in the Program nor will
any public official either directly or indirectly benefit
financially from the Program;
(i) The City, in reviewing the Program, has considered the
information contained in the City's 462C Housing Plan adopted
March 6, 1980, (the "Housing Plan") , including particularly (i)
the availability and affordability of other government housing
programs; (ii) the availability and affordability of private
market financing for multi-family housing; (iii) an analysis
of population and emplayment trends and future employment needs;
(iv) the recent housing trends and future housing needs of the
City; (v) an analysis of how the Progra�n will meet the needs
of persons and families residing and expected to reside in the
City; (vi) an analysis of how the Program furthers statewide
housing policies; (vii) whether the proposed amount of the
bonds will exceed the limitation provided in MSA � 462C.07,
subdivision 2; and (viii) an analysis of administrative and
bond issuance casts.
• �����8
-3-
NOW, THEREFORE, BE IT RESOLVED by the Council of the City
of Saint Paul, Minnesota as follows:
1. That the Program is in conformance with the goals and
specifications of the City ' s 462C Housing Plan adopted March 6,
1980, and is hereby approved.
2. The City hereby gives preliminary approval to the pro-
posal of the Developer that the HRA undertake the Program, making
or purchasing of mortgage loans to finance the acquisition of
condominium units by individuals or families in the 59 unit
condominium conversion project at Childrens Hospital pursuant to
Section 462C. 05, Subdivision 1 (d) of the Act.
3. On the basis of information available to the City it
appears, and the City hereby finds, that the Program constitutes
a multi-family housing developrnent within the meaning of sub-
division 1(d) of Section 462C. 05 of the Act; that the Program
is located within a redevelopment project area established
pursuant to Minnesota Statutes, Chapter 462; the availability
of the financing under the Act and the willingness of the HRA
to furnish such financing will be a substantial inducement to
the Developer to undertake the Program, and that the effect of
the Program, if undertaken, will be to encourage the provision
of additional multi-family housing opportunities to residents
of the City, to prevent the emergence of blighted and marginal
land and to promote more intensive development and use of land
within the City;
4 . The Program cantemplating the issuance of revenue bonds,
is hereby given preliminary approval by the City subject to the
approval of the Program by the Minnesota Housing Finance Agency
("MHFA") and subject to final approval by the HRA, the Developer
and the purchasers of the Bonds as to ultimate details of the
financing of the Program;
5. The Developer has agreed and it is hereby deter�nined
that any and all costs incurred by the City and the HRA in
connection with the Program whether or not the Program is carried
to completion and whether or not approved by MHFA will be paid
by the Developer;
r 6. Nothing in this Resolution or the documents prepared
pursuant hereto shall authorize the expenditure of any municipal
funds on the Program other than the revenues derived from the
Program or otherwise granted to the HRP, for this purpose. The
Bonds shall not constitute a charge, lien or encumbrance, legal
or equitable, upon any property or funds of the City or the HRA
except the revenue and proceeds pledged to the payment thereof,
nor shall the City or the HRA be subject to any liability thereon.
WHITE - CITY CLERK ��594$
PINK - FINANCE COl1tIC1I
CANARY - DEPARTMENT G I T Y O F S A I N T PA LT L
BLUE . �MAYOR File N O.
�.
Council Resolution
Presented By
Referred To Committee: Date
Out of Committee By Date
—4—
The holder of the Bonds shall never have the right to compel any
exercise of the taxing power of the City or the HRA to pay the
outstanding principal on the Bonds or the interest thereon, or
to enforce payment thereon against any property of the City or
the HRA. The Bonds shall recite in substance that Bonds, in-
cluding the interest thereon, are payable solely fro�n the revenue
and proceeds pledged to the payment thereof. The Bonds shall not
constitute a debt of the City or the HRA within the meaning of
any constitutional or statutory limitation.
7 . The HRA is authorized to exercise, on behalf of the
City, the powers conferred by Minnesota Statutes, Section 462C . 01
to 462C. 08 with respect to this Program.
COUNC[LMEN
Yeas Nays Re tgd by Department of:
Hunt
Levine In Favor
Maddox �
McMahon
Showalter - __ AgaitlSt BY
Tedesco
�
NOV � g �qR� Form Approved y ity tor
Adop by Cou il: Date `
rtiEied P• sed by oun ' Sec etary BY
5'
,�, NQV `�, 5 �4� Approve Mayor for Subm' ion �ouncil
A d by lNayor: D —
By — BY
P�B1.tS�4tC:� i o�; , �;; _ i`�'.;�
PROGRAM DESCRIPTION
� Irvine Hill Condominiums/Children's Hospital Project ����`�'
The Housing policies and plans for the City of Saint Paul, as specifically stated in the Housing
Plan adopted pursuant to Chapter 462C, Minnesota Statutes 1979, support the creation of new
residential opportunities through the conversion/rehabilitation of non-residential structures.
In the fall of 1979 a plan was announced by Ted Glasrud Associates, Inc. and the Children's
Hospital, Inc. to rehabilitate the vacated Children's Hospital complex for multi-family condo-
minium housing. Since that time, the City has demonstrated its support for the project not
only by providing the developers with technical assistance but also by providing mortgage financing
for purchasers of units in the project under the St. Paul Below Market Home Rehabilitation
(BMHR) Program.
The Children's Hospital complex has long been a landmark on the Pleasant Avenue approach
to downtown Saint Paul. (See location map attached as Program Exhibit 1). Due to declining
utilization in recent years, it was decided that the Children's Hospital would relocate to the
new United Hospital's complex located across Pleasant Avenue in 1978. The future of the econom-
ically obsolete facility was in doubt until the announcement of plans for rehabilitation for housing
in 1979.
THE PROJECT
The project to be financed under the Program has been designated the Irvine Hill Condominiurras.
It consists of 59 one and two bedroom units ranging from 785 - 1,250 square feet each. Sales
prices for the condominium units range from approximately $52,000 - $95,OOQ.
The total renovation of the structure is nearing completion at a rehabilitation cost of approximately
$2.5 million. All construction plans and specifications have been approved by the Saint Paul
Division of Building Codes and all materials and workmanship will be inspected for compliance
with all applicable building codes. A new 60 stall, two level parking ramp is currently under
construction to provide off-street parking for condominium owners.
As stated above, the Irvine Hill Project was approved by the City for mortgage financing of
units under the St. Paul BMHR Program. Approximately $1.6 million has been committed to :
mortgagors of 26 units under the BMHR Program.
The Fin4ncing Program
The proposed financing program involves the private placement of a $2,000,000 tax-exempt
Housing Revenue Bond to be issued by the Housing and Redevelopment Authority. The Northwestern
National Bank of Minneapolis has preliminarily agreed to purchase the Bond in this principal
amount to bear interest at a rate not to exceed 9.75%.
The proceeds of the bond issue will be used solely to provide mortgage financing for purchasers
of approximately 30 units in the project. As each unit is sold and the loan approved to a qualified
mortgagor, an exchange revenue bond to be secured by a mortgage on the individual unit shall
then be issued by HRA and the initial principal amount of the Bond shall be reduced by this
amount. The unit mortgagor, by execution of a promissory note, assumes the developer's obligation
to repay that portion of the loan.
When all mortgage loans to be financed under the Program have closed, the original $2 million
Bond shall have been replaced by exchanged revenue bonds to be amortized over 29 years. Any
portion of the original Bond not assumed by qualified mortgagors must be prepaid by the developer.
The Saint Paul HRA will review and approve the loan applications of all qualified mortgagors.
The criteria for qualified mortgagors will include an affordability test (See attached Program
Exhibit 2) and a requirement that the units be owner-occupied.
., � . . ��� :;e , `j � . : � �!�
° � � . �48 .
, _ :-�-_ _ � � _. :� C� �. .� �
-'�. . � N, W S T R N ' .
_„ _ � � o� ` r - N . o . �
p � � D m D � �
a �y C �
D. • It • � �1� _ � � � _
� . u � r ' Z D
"A vlFtr.INl rr-
o r .{ i • I
z ' � .
< < < ' < o a • . • <
_ . p � F/1RRING ON ' . n y
1 _ . L =�
J :y � .2 �
../ � . � � 1
� �-� z � �
r (�, ' �a,�r � z
� . _. � -��.c• '� , e n
�OUG A S ST. � � y. �q y� •; ; `'
� � � ���
- -- J� / ���c� �' . �
J �� z �,. � ��
o �Y
SMITN THOAIP�`' o.�\ O � CJ,J
Q . . ,� �� � � � , . `
� q 9� • ` �� ' Z �
-s+�F,�. � 1 r- ��
Z� �� -C�?Cl /
LE�G� ' �T.• \(' �yr
� .�,�
� . -� �.
�4 ` � � ��'y ^�, . : . . .�� 0 0�'� • '��" `
� ��` �: y r \ `� `�� . ���
WILKIN 3T. , �
` � .
� 4 \ �� � �
♦� r �`y \ �y�' � SG
ti . ' � i �4� �y �'�s,r `
.
1�' ` .y'�: �.�i . � q` �
i 'e'-�. , � � . . � _ .� � F
f� �'o
� SMr TH ( .
. � � ,
E• ,
�� �` �', . c�
Q `��" �� `' _. � s�' i
�
� '°'�'-t'� j�� 'I !'_"'_-- M A f!y • � c
(� . d j � n� �- sl
�
- � � �� - . — _
�
. J `� f'� ' � r , -t a
. � � _ -
, �
. '�J . q` , . �� f �Ck�NGE � ' ��
� c�� � . i • .
. �_ � , . , . � ��
(f �-�_. L r � :
,sy � !� ' � r • o �
. �
�'° f� ��� � a � oR�UM .-� � .
9�\ ,� � � �� S T
�'
•y5 � ���
i � ! . c�,-
v c+
. � �\ � Q r wA SH� � � d� Sa ��►
. 'A � /) � � a � .a �N(�7`��'H� S 7' ��I►�D�� �o �N �
°� � a 2 ^' � ^ L_------' �`i . �` �
• o i �3y�urw ��� - o�� �
.' 1 .i S �
. <
. , � ' ,
� � , ��
• / . ti � �/ �% �. C
. i . � yo
. s
� �
- � '6 _°� �� . G y y,�
� � � �' f y '
, �
� '� �
� , � y �
.
.
.
- _...,•�_ _ __ ,._.._ .�s�� . \ 1 ��'�_ _�. ._ _ . - � �� --
?-�-�-..� // � ,, ._ _.� __-_ : --- - I�--_. _ _ ,__.
,�} ._
_ �..�. _. .., . _ _ � . ,. _ _. _ _.�.� _ . _�
� „ � . • � . . .
�594$_ - .
. 'EXHIBIT 2
AFFORDABILITY TEST FOR ELIGIBLE BORRO��lERS -
.The �criterion for determination ��hether the � .
purchase of a dwelling. unit in the Cross�aa�rs Project ma�r � '
properly be provided in whole or in part by permitting the - - _
� ' purchaser to assume a portion of the loan made for construc-- �
• . tion, to be 'financed. on a long term basis by the continued
• obligation of a like principal amount of the Revenue Bond,
or whether such financing is otherc�ise available from -
� private lenders upon terms and conditions which are affordable -
� by a purchaser applying for public financi.ng, shall be whether: -
. (a) The interest rate, discoiznt,- and term then � � - -
available in the conventional mortgage market for a com-
� - parable mortgage loan is ascertained from.a qualifiec� lendinq � � -
institution in accordance G�ith the terms of the Loan Agreemen�;
(b) The annualized amounts of princinal and in- , . -
terest payments (based on a market rate establishecl in acc-- . '
� ordance with the. terms of the Loan Agreement) taxes,
insurance and common expenses (as defined in P4innesota Statutes
Section 515.02, Subdivision 8) are computed by the qualified
lending institution and verified as to mathemati.cal accuracy _
by duly designated HRA persorinel; . . -
(c) The Adjusted Annual Income of the applicant � _
is c�mputed from information certified by the applicant; as:� -
� {l) gross family �.ncome from aI� sources, hzfore �
taxes or withholding, which shall incTude the income of the " �
purchaser and any �o-bwner of the fee interest in the unit, hi�
. or her spouse, and any member of the purchaser's (or co- �
owner's) faxnily residing in the unzt, less: � �
� . . (2) the fallowing: (a) income of any person -
� described in clause (A) who is under 18 years of age or who '
is a full-tir�e student and who is related by blood, adoption,
or marriage to a resident income recipient or his or her _ . ,
spouse, (b) non-recurring inco,-�e, (c) sums received for foster - •
child care, (d) . extraordinary medical or other expenses,
(e) income� of each additional income recipient 18 years Qf
a�e or older and described in paragraph (I) , �other than the
primary inCOme recipient, but not exceeding the amount o� .
$750, (f) an amount equaZ to $750 for each resident of the
unit who is 18 years of age or older (maximum of tcao) and
. $5�10 for each additional resident; (g) an amount up to $750
for child care expenses that are eligible for deduction under •
' U�ited States Internal Revenue Service tax regulations, but
not exceeding the ar.�ount of $750. � : � ,
_..__.. � - _______ - ------- - -
_.._ _ _ � �._ ._.. - -- - ___ .
_ —
��
__ .._..__.�._.,_�___,_ _____._�_.__ ___.�.
___ _�,.______
_.._...�.._....�....,...._ ..�_.T,..�._..,.�, .-....-..... .........-_.-.._._...___�._.. .�b.—.�n��._.. . , . ..
. ..� _�' .. _ _..__. . � � . . . .
� - � , �� " - . � � . � �594� -_ �
. • (d) The total of. the annualized amounts referred
• . to in clause (b) exceeds 2(l percent o£ the Adjusted Annual �
' Income computed pursuant ta clause (c� , in ��hich case the .
� applicant shall be deemed an Eligible Borrower; provided tfie
� anplicant shall not be deemed an "Eligible� Borrower" unless - .
at the closing di the sale,� the apnla.cant files with the Bank'
� a certificate that he or she intends to use the un3t as his � �'
� or her primar� residence, does not intend to use the unit
as rental or income proper'ty, and sti,ll qualifies as ari ' � . •.
Eligible Borrower. • - . - -
� . � � �,:
; :
� - > . . - .
__: . _.-----_. -- _._ -- � .
_.....___ ______ .- --,,
_
-. _ _._ ___._�_._.�.� ._ .�� ____.�_..__ _ '""� _
�
._ �,.._.,_.�,� . _..,� ,�� _ _ ___ _ v :x�_ .,,.__
�
_.._._._ ....�.,. e_... __.__.�_._ �_ ._ ._ :_.. _
.__..._ _.._________ __._.___._._.__.
2�5�4�
`,,: NO![CB�PU�l;IC HEAN�S OAI A PRO-
£ P08AL FOB A MO(i�A1M!O PINANCE
`. A lNUL17.FAMILY 01RYblt YOCOlIED'".
' CONDdpN1UM HOUSING DiVEIAP-
� `i `:�N�'P fCIAi,DEEN'S HOSt1'PAL!�O-
JBLT►
To w�3om it may concern: .
NObkt l�ifeilby givm t�at!Ne-Cky CounCll �A.:� ��
of the Ctty ad Saint Paui.llteeesola will meet �y;
at�fheClt�@suncil Chambea,Cffy Hall in the 4�;.
Citg ct Safat'�etd,Minpes�et t1Y.00 o'clxk
a.m.�m��r1.i..�9�f:To cmNder tAe pro- "
pnsai a-iee awasiad;wswci#yee. lnc., and w
C�kMe�n's Hospital. U►at fde Hopeing and ` 1 e;..
�top�at Ant6ork'of�Cltj of Saint � j►1R' � } �
Paul.ltioeewta("HRA'9 assiet in fin� �` �� +'.�;`;
ainB q,
deve�t hereinaft�dderlbed.,6y.the is-
$wM�e��rev��x bonds ,, ��� �'y,
�x
~��R[PTIQN OF DEVEIAPMENT Mln � ,y
'Phe pro�tam b!o m�ke or Paichas�mort- " � � R�
A+i�a:fa�os to fio�nea th's ts-'.,-;
aoQubition of �� t veaue� ;�
em�emiotom untts�n ane�vffis co� . " �,�
'� deedsium convers3on project ai �t h , �.
, Chi�de!m's Hospltal pnzswu�t .to Mio- �M�
�(wl�.8tetntes..8lAloa l6Y.OS Subdivl% ' Y0� r'
���(�. ��
a$= ; �°�
,��v�ta.ra�or�.«� g '
; P�.Myaeioas co bc hrpea eo noanoe t� � .� F��t
itif.�600: ' �x rs r•'�,<, I��e�.
t'e{-
- ��A��dY�blTOI1ISjQtIOASISBGaiI1E� .
'M+
' isswd wi�t i�t!�tit�e�a e9�ar�e,tien or m- , Y,
� I�V���H��' i;; i
� the Cit7 ot�Paal<tlfl!"p ") �°t
t7 �t She
Pm Nd,.
�. f �� �
1!!�a� . �� �, _ , r �
L�+1"e�idit oi taxig� � `�; � !'��
�Va�ie:kap su�'"�6,,Rover�'c�a�e Ce ao�",�
Y1�8 ��d
developNsD�sq�tta'���� �' • r1
Adeaft�aithe� '�pu�pgfioaoce ��' d
', q�Q'±�. all'att�haients aad ? �'
ec�tte iit�+�rA�to�r yvblle io- r�yi ';`;
' � � '. �i1Lr g.19b0�f:om 9 � � �s'
o'do�k�8.�i.'bti :��t�.'�►.;'�oodsY tNrou� : x ��.
LrWRJ.at the��tthe ltanewd Dlvlaion. � �f;.
Bepart�nt et Plannia;-aed iesnomic
De�wlapo�t.Cit7 11�11 Anndf:7EtM.11oon .i.
Ak t6e tLpe�nd.bee fl�d for sald'Pubiic f ;+e! " �.
He�dnK,t4e..Clt�thlugcil of tihe p4y o!$qlnt "� ';
�t.� . .,. .��, ���.gP- i r
�p�f7�ezPrecs
thdr vfews wi'!F n�ect te 1me prapoyL � .
Dated this&h dt�46t N��9p. , 2', � ���.
'�'-�-rf' w '-"'�� > fCfafk��._�i. �N►k, Cily'�•:
S..�:r .axc ea�t+��:�� i I Pras�Dt��las�t•,:, �
����ST P�it#��i�C�i#,�`':/.�w►►►► -