275952 WFItTE - CITY CLERK ` A
PINK - FINANCE 7� COURCII y t
CANARY - DEPARTMENT G I T Y O F S A I N T I A U L �~ �
BLUE - MAYOR File N O.
Council Resolution
Presented By
Referred To Committee: Date
Out of Committee By Date
WHEREAS:
1 . On October 28, 1980, the Port Authority of the City of Saint Paul adopted
Resolution No. 1718, giving preliminary approval to the issuance of revenue bonds in
the initial principal amount of $470,000 to finance a 12,500 Sq. Ft. addition to
Consolidated Electric Company's present facility in Riverview Industrial Park;
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. 1718, 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 Requestgd by Department of:
Yeas Nays
Hunt � �
Levine �� [n Favor
Maddox �/
McMahon (!
s�,owaite� _ Against BY
T� _G�`Q�
Wilson t��n
NOV 1 g � U Form Ap r ved by Cit tto
Adopte y Council• Date
C ified Pas by Cou .il Secretay� BY � �
Ap o d by ;Navor: t OV 2 APPr by Mayor for Su unc�
By - BY
7 � �n��
4.�tt'»,. , .
P � RT
°�AUTH4RITY �`�5��2
•OF THE CITY OF ST. PAUL
Memorandum
TO: BOARD OF COMMISSIONERS .9� DATE October 24, 1980
(Meeting, October 28, )
��\�,
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FROM: Donal d G. Duns hee �,
• . 1
SUBJECT: CONSOLIDATED ELECTRIC COMPANY
PUBLIC HEARING - PRELIMINARY AND UNDERWRITING AGREEMENT
$470,000 REVENUE BOND ISSUE
RIVERVIEW INDUSTRIAL PARK
RESOLUTION N0. 1718
� 1 . COMPANY
Consolidated Electric Company was started in St. Paul in 1922 and
has operated within the City since that date. In 1968 the Port
Authority Commission approved the issuance of $245,000 in industrial
development revenue bonds to finance the construction of a 14,400
Sq. Ft. facility in Riverview Industrial Park. The Company has
operated since that time in Riverview and has experienced vigorous
• growth in recent years and now needs to expand their building to
accommodate the growth.
2. PROJECT
The Company proposes to construct a 12,500 Sq. Ft. addition to their
present facility. They are a manufacturer of electronic control
service devices and the accompanying brochure outlines the type of
product they manufacture. The addition would be constructed to con-
conform to the covenants of the industrial park and the parking area
would be blacktopped and the remainder landscaped.
3. FINANCING
The proposed financing of the facility would be done through a �470,000
industrial development revenue bond issue under Resolution 876 as follows:
Construction $362,775 .
Bond Issue Expense 14,000
Debt Service Reserve 56,800
Capitalized Interest
(Six Months) 22,325
Discount 14,100
470,000
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CONSOLIDATED ELECTRIC COMPANY 5����
� October 28, 1980
Page 2
In addition to the monthly rent the Company would pay a fiscal
and administrative fee as follows:
First 10 Years $300 per million issued
Second l0 Years $400 per million issued
4. UNDERWRITING
Miller & Schroeder Municipals has agreed to issue the revenue bonds
and the interest rate on the bond issue will be set ten days before
closing.
5. TERM OF THE AGREEMENT
The issue would be for a term of twenty years commencing December 1 , 1980
through No vember 30, 2000. The Company would have an option to purchase
the building for 10% of the bond issue cost.
6. RECOMMENDATION
Staff has reviewed the project in detail along with the financial statements
• of the Company and recommends approval of Resolution No. 1718.
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• •. , Resolution No. 1718
�G i��t1�G+
� RESOLUTION OF
THE PORT AUTHORITY OF THE CITY OF SAINT PAUL
�dHEREAS, the purpose of Chapter 474, Minnesota
. Statutes, known as the Minnesota h;unicinal Industrial Develop-
' ment" Act (hereina�ter called "Act" ) zs 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 so��nd industry and commerce are
the increasing concentration of pogulation in the metropolitan
areas and ;he rapidly rising increase in the amount and cost of
governmental services required to meet the needs of� the
increased population and tne need for development of land use
which will provide an adequate tzx base to. finance these
increased costs and access to employment opportunities for such
population; and •'
• WH£REAS , The Port Authority of the City of Saint ?aul
( the "ALthority" ) has previously issued its revenue bonds in
the arnoun� of $245, 000 to finance the cor.struction of a manu-
racturing facility in the City of Saint Paul �by Consolid��ed
£lectric Company (hereinafter the "Company" ) which Company
currently leases that facility from the Authority; and
4��HEREAS the ALthority has received from the Company a
request that the Authority issUe additional revenue bonds to
� finance the acquisition, installation and construction of �n
addition to the existing manuf�cturing facility (which addition
is hereina`ter called the "Project" ) all as i.s more fully
described in the staff report on file ; �nd
t�':�EREAS , the Authority cesires to facilitate the
- selective developrnent oi the co���mLnity, to retain and iTp�ove
its tax base and to help it prcvice the range ef services a;�d �
eiii�l�}'fi1G:�� OF�O��Url1t1E5 reauired JV 1�5 DGDt1�ct.10;'1� c:�� SciC� '
Proiec� '»i�l ass_st the City in ac7ievine that objective . Saic
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. 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
wi11 result in substantial employment opportunities in the•
Project; � '
hiHERt�AS, 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
Autnority that wi_th the aid of revenue bond financing, and its
resulting low borrowing cost, the Project is economically more
� feasible ;
�. �4;�3EREAS , Miller & Schroeder Municipals, Inc. ( the �
"Underwriter" ) has made a proposal in an agreement ( the
- "UnCerwriting Agreement" ) relating to the purchase of the
revenue bonds to be issued to finance the Project;
Tti�HEREAS , 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 tbe
office of the Authority, of a public hearing on the proposal of
the Company that the Authority f=nance the Project hereinbefore
described. by the issuance of its industrial revenue� �bonds ; and
Wr3EREAS, the Authority did conauct a public .hearing
pursuant to said notice, at which hearing the recommendations
cortained 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 RF.SOLVED by the Commissioners
of the. Port Authority of the City of Saint Paul, r4innesota as .
follows:
1 . On the basis of information available to the
�.uthority it appears, and the Authority hereby finds, that said
'rroject constitutes properties, used or Lseful in conne�ction
with one or more re�enue producing enterprises engaged in any •
bu= ine=s within the meaning of Subdivision 1 of Section 47� . 02
o` the ?�ct ; that the Project furtners the purposes stated in
S?C�lOfl �7� • �1 Oi t.r7e ACt � �}�ci t:i2 cVc}�a�Jlllty Of tne
financing unoer the Act snd willi�eness of the �.utheri�y to
furnish such financing will be a substantial inducement to the
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Company to undertake the Project, and that the effect of the
Project, if undertaken, will be to encourage the development of
econor�ically sound industry and commerce and assist in the
. prevention of the emergence of blighted and� r,�arginal land, and
will help to prevent chronic une�ployment, and will help the . .
City to retain and improve its tax base and prov?de the range
• o£ se rvices and employr�ent 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 within the
state where their services may not be as effec�ively used and
will result in more 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 or the City o` Saint Paul and
- in ,furtherance of the general plan of develop�ent to assist the '
Company in financing the Project.
2 . Subject to the mL�ual agreenent of the
_Authority, the Company and the purchaser of the revenue bonds
as tc� the details oi the lease or other revenue agree^�ent as
defined in the Act, and other dccur�ents necessary to evidence
and effect the financing of the Project and the issuance of the
revenue bonds, the Project is hereby appYoved and authorized
and the issuance oi revenue bonas of the P.uthority in an anount
not to �exceed approximately $L70, 000 (other than such
additional revenue bonds as a�e needed to co,:,plete the Project)
' is au�horized to finance the costs of the Prejec� aria the
recommendations of the Authorit;�' s stafi, as set forth in the
staff r�emorandum to the Commissioners which was presen`ed to
the Conmissioners, are incorporated herein by reference and �
approved.
3 . In accordance wi�h Subdivision 7a o� Section
474 . 01 , N,innesota Statutes, the Executive Vice-Presioent of the
AUTHORITY is hereby authorized and directed to subnit the
proposal for the above describec Project to the Comm�ssioner of
Securities, reauesting his appreval, and other officers,
' employees and agents of the AU'T?:0?.ITY are hereby 8L't:�OL'ized to
provice the Comnissioner with s�ch prelininG�j ir`er--���ion as
he may require. '
4 . There has heretc�ore been Filed with the .
Autherity a fo�-r,i o� Prel iminary Acreer;ent be�ween t?-ie -.uthority
anc Ccm�ar:v , relating to �he prc�e=ed cc^;=tY�ctien anc �
iinancing of the Project and a =orm of t:;e Underwriting r.gree-
r,�ent• IJIe 1��.� �F s�ld T�CYeE i.��".�.'�.S 11GVE ✓CEi� e�.G��1TiCCi �V L�le
C0:^nissicners• it <<J L�e �L'r�CS@ Cil �G�G' "�~eE�1�:11.0 L� ,
evidence the com�it^�ent of t1-e �ar�ies and t'r,eir inten�io^s
with respec� to the �roposed rrciect _n orceY that the Cc:.,pa�y '
i:'icy proceed W1�}�011� C�21ZV W1�'7 �'�12 CC�':f'?e.^.CE-:i;12f�t Ci �;12 cC�L'151—
�1G'?� _ilS�c�Zct101-1 cIlC1 CC1:��L':-1C�1Cil Ci �.^S YL"O]C-Ct ti'].t:? "�E
assur�-�nce �hat th�re has been s��,-:iicient "o£ficial� act�en"
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to finance the entire cost of the Project ut�on 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 Preliminary Agreement by
' the Company, the staff of the Authority are authorized and
dir•ected to continue negotiations with the Company so as to
resolve the remaining issues necessary to the preparation of
the lease and' other documen�s necessary to the adoption by the
Authority of its final bond resolution and the issuance and
delivery of the revenue bonds ; provided that the President (or
Vice-Pr�esident if the President is absent) and the Secretary
� (or Assistant Secre�ary 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 ��ith the
�rovisions of Minnesota St�tutes, Section 475. 06, Subdivision
1 , to acceot a final offer of the Underwriters made by the
Underwriters to purchase said bonds and to e�ecu�e an
unde?-writing agree�ent setting forth such offer on behalf of
the Authority. Such acceptance shall bind the Underwriters to
said offer but shall be subject to approval .�and r.ati�ication by
the Port Authority in a formal suppler�ental bond� resolution to
• be adopted prior to the delivery of said revenue bonds .
6 . The revenue� bonds and interest thereon shall not
constitute an indebtedness of the Authority or the City of
Saint Paul within the meanina 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 ch�rae
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 paynent of the bonds or interest
• thereon.
7 . In orc�er to iacilitate completion of the revenue
bond financing herein contempla�ed, the City Council is herebv
reQUested to consent, pursuant to Laws oi f�9innesota, . 1976, �
Ch�pter 234 , to the issuance of the revenue bonds herein .
contemplated and any additional bonds which the Authority nay .
' �r?or to issuance or frorn tir�e to tine thereafter deem
:�ecessarv to co;�plete the Project or to refLnd such revenue
boncs ; and `or such pLrpcse the Executive Vice Pres_cent c` the
:.u��'iOrl�}� 15 hereby cJthorized �n� Glrect,ec �O iOrWZr� �O �.h@
City Council copies of this resolution and said Pre' ir:�narv
.'-cree�ent anc any additional available info�natien the City
Ceuncil nay reaLest.
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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 pr�incipal amount of bonds to� be issued to
finance the Project and in preparing a draft of the proposed .
�� applicat'ion to the Comr�issioner of Securities, State of �
Minnesota, for approval of the Project, which has been
av�ilable for inspection by the public at the office of the
Authority from and after the publication of notice of the
he�-ring, are in all respects ratified and confirmed .
Adopted: October 28, 1980 � _
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A t t e s t ( c/,�/�" . ` ' .__
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Pre-s�.dent%
The Pcrt Authority or the City
• oi Saint Paul �
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. ��.�� • Secretary � /
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; . OM Ol : 12/19
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• Rev. : 91 � 76
t , EXPLANATION OF ADMINISTRATIVE QRDERS,
_ . RESOLUFIONS,,AND ORDINANCES . `_
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Date: October 28, 1980
TO: MAYQ GEORGE LATIMER R E C E I V E D ,
. OC?" 3 1 t980
�R: E. A. MA_Y�,�4 G� •
RE: CONS IDATED ELECTitIC COMPANY
$470,000 REVENUE BOND ISSUE �
RESQt,ltTION N0. 1718
ACTI;flN REQUESTED: . . .
In acao�rdance with the Laws of Mannesota, Chapter 234, it is requested t�at the
City Ga�yncil, by Resolution, a draft copy of which is attached hsr+�to, ap�rove
the is�e of. revenue �onds in �he amount of appraximately $47Q,� ta ftnahce
a 12,5a9 Sq. Ft. addition to Consolfdated Eiectric Company located Qn 141 South
Lafayet�+e Freeway in Riverview Industrial Park. The Company has expe�^iertcxtl
v3gcrous growth in recent years artd now needs to expand their builditrg to
accomaadrtte the growth.
PURPOSE AND RATIONALE FOR THIS ACTION: �
� The purpose of the bond issue is to finance a 12,500 Sq. Ft. addition to Consvlidated
Electric Company's present facility in Riverview Industrial Park. They are a manufactur�� ;
�; of eiectronic control service� devices. The addition w�ould be constructed to conform
to the covenants of the Industrial Park and the parking area would be blpcktopped and
� t#�e remainder landscaped. Employment w�ould be increas�d hy aRpraxi�ately ten persons.
The bo�d issue wvuld be for a term of twenty years.
ATTACHI�NTS: �
Staff Memorandum
Draft City Cauncil Resolution
Port Author�y Resolution No. 1718