275953 WNITE - CITY CLERK �
PINK - FINANCE �5 53
CANARY - DEPARTMENT � G I T Y O F SA I N T PA U L COl1I1C1I Q
BLUE - MAYOR File� N O.
u cil 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. 1722, giving preliminary approval to the issuance of revenue bonds in
the initial principal amount of $275,000 to finance the acquisition of a new glueing
machine for Kaplan Paper Box Company located 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. 1722, 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.
COUIVCILMEN
Yeas Nays Requestgd by Department of:
Hunt ��
Levine In Favor
Maddox
McMahon A ainst BY
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son
NQV �_ � »R� Form A r ed by Cit tto
Ad ed by Coun � . Date ����
ertified V• d by Co cil Secretary B �
Ap e by :1�1ayor: t � _ ��V �� �S?(1 A ro ed y Mayor for S is n to Council
D'T
By _ BY
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�► oRT
AUTHOtt1TY �`�5453
OF THE CITY OF ST. PAUL
��� Memorandum
TO: BOARD OF COMMISSIONERS, DATE: October 24, 1980
(Meeting October 28, �980)
i ���,,
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FROM: Donal d G. Dunshe� `
�'`J
SUBJECT: KAPLAN PAPER BOX COMPANY
PUBLIC HEARING - PRELIMINARY AND UNDERWRITING AGREEMENT
$275,000 EQUIPMENT LEASE - PRIVATE PLACEMENT
RESOLUTION N0. 1722
1 . COMPANY
Kaplan Paper Box Company presently leases from the Port Authority
a facility at 403 East Fillmore Avenue. The Company has experienced
rapid growth and has asked the Commission to consider the issuance of
an additional $275,000 in industrial development revenue bonds.
2. PROJECT
The Company proposes to acquire a new glueing machine estimated to cost
$275,000. The bond issue for the equipment would be done through a
private placement and done on the credit and security of the Corporation
and not the Port Authority.
3. FINANCING
The proposed financing of the equipment would be done through a loan
agreement placed by Miller & Schroeder. In addition to the monthly rent
the Company would pay fiscal and administrative fees.
4. UNDERWRITING AND TERM OF THE LEASE
M;ller & Schroeder is working on a private placement of the issue and
the exact term of the lease and rate has not been determined.
5. RECOMMENDATION
Staff has reviewed the project, interviewed the officers of the Corporatian,
and recommends approval of Resolution No. 1722.
sjs
�� �., . ����� �`�5953
. •`" Resolution No. 1722
RESOLUTION OF
THE PORT AUTHORITY OF THE CITY OF SAINT PAUL
. . WHEREAS, the purpose o` Chapter �74, Minnesota
' Statu�es, known as the Minnesota ASun?cipal Industrial Develop-
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
chron?c unemployment and to aid in the development of existing •
" areas of blight, marginal land and persistent unemployment; and
�,''rIER�AS , factors necessitating the active promotion
and development o� economically sound industry and commerce are
the increas.ing concentratibn of population in the metrapolitan
areas and the rapidly rising increase in the amount and cost oi
covernmental services reauired to neet the neecs or the
increased population and the need ior development of land use
which will provide an adequate t�x base to �inance these
increased costs and ' access to employment opportunities for such
_ population ; and '
���HEREAS , The Port Authority of the Ci�y cf Sa.�nt P�ul
( the "Authority" ) has received from the Kaplan Paper Box
Company (hereinafter referred to �s "Company" ) a request thGt
the Authority issue its revenue bonds. (��hich may be in the form
of a single note ) to finance the acguisition and installation
of a glueing machine (hereina�ter called the "Equipment" ) to be
used in connection ��ith the Company' s existing facility in the �
City of St. Paul, all as is more fully cescribed in the staff
report on file ; and
t,�Y,EREAS, the Authority desires to facili�.ate the
selec�ive develo�ment of the community, to retain and improve
1i.5 �8X base c;lQ �O help lt DI"OV1C@ Li�2 r�nge Oi services c:1G�
E?�'�ployment OpDOrtllnitlBS required by 1�S �ODU�2tlOn� dnd Se1C3
�GL'1DTi@^t �'ll� cSS1S� the C1��% 11'l cCi71EV1Ila t�'lc� O�i�EC�1VE � ci1Q
` � �, . �'S�'�3
r �' WHEREAS, the Authority has been advised by repre-.
sentatives of the Company that conventional, comrnercial •
• financing to pay the capital cost of the Equipment. is available
only on a limited basis and at such high costs of borrowing
� that the economic feasibility of acquiring and operating the
Equipment would� be significantly reduced, but the Company has
also advised this Authority that with the aid of revenue bond
financing, and its. resulting low borrowing cost, the purchase
and operation of the Equipment is economically more feasible ;
WHEREAS, Miller & Schroeder Municipals, Inc. ( the '
"Placement Agent" ) has made a proposal in an agreement (the
. "Placement Agreernent" ) relating to the purchase of the revenue
bonds to be issued to finance the purchase of the Equipment;
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 hearin�g on the proposal of .
the Company that the Authority finance the purchase of the �
. �� Equipment hereinbeiore described by the issuance of its
industrial revenue bonds; and
A7HEREAS, the Authority did conduct a public hearing
pursuant to said notice, at which hearing the recommendations
contained in the Authority' s staf` memorandum to the
Commissioners were reviewed, and all persons who appeared at
the hearing were given an opportL�nity to express their views
With respect to the proposal. �
. NOW, THEREFORE, BE IT Rr.SOLVED by the Commissioners
- of the Port Authority of the City o` Saint Paul, Minnesota as
follows: �
1 . On the basis of in`orm�tion available to the
Authority it appears, and the Au�hority hereby finds, that said
Equipment constitutes properties , used or use�u� in connection
with one or more revenue producing enterprises engaged in any
business within the me�ning 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
`inancing under the Act and willingness oi the Authori�y to
�urnish such financing will be a _=ubsLantial .induce�ent to the
Comp�ny to purchase the Equipmer.t ; and that it is in the bESt
interests of the port d�strict anc the people of the Ci.ty of
Saint Paul and in further�nce o` �he general plan of
. develop,;�znt to assist the Com�any in iinancing the purchase cf .
the Equipment.
. �
� '- • 2. Subject to the mutual agreement of the ��5���
Authority, the Company and the purchaser of the revenue bond�s
� as to the details of the revenue agreement as defined in the
� Act,, and other documents necessary to evidence and' effect the
financing of the purchase of the Equipment and the issuance of
the revenue bonds, the purchase of the Equipment is hereby
approved and authorized and the issuance of revenue bonds of
the Authority (whi.ch. may be in the form of a single note) �in an
amount not to exceed approximately $275, 000 is authorized to
, finance the_ purchase of the Equipment, and the recommendations .
of the Authority' s staff, as set forth in the staff inemorandum
to the Commissioners which was presented to the Comm?ssioners,
are incorporated herein by reference and approved. �
3. In accordance with Subdivision ia of Section
474. 01 , Minnesota Statutes, the Executive Vice-President of the
AUTHORITY is hereby authorized and directed to submit the
proposal for the purchase of the Eauipment 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 prelim?n�ry information as
� he may require.
4 . There has heretofore been filed with the
Authority a. form of Preliminary Ag�eement between the Authority
and Company, relating to the proposed financing and a iorm of
the Placement hgreement. The iorm of said Agreemen�s have been
examined by the Commissioners. It is the purpose of said
Agreements to evidence the commi*ment of the parties and their
intentions with respect to the proposed purchase of� � the
� Equipment .in order that the Company may proceed without delay
with the acquisition with the assurance that there has been
sufficient "official action" under Section 103 (b) of the
Intern�l Revenue Code of 1°54 , as amended, to allow for the
issuance of industrial revenue bonds to finance the entire cost
of the acquisition upon agreement bei.ng reached as to the
ultimate details of its financing. Said Agreements are hereby
approved, and the Pre�sident �nd Secretary of the Author?�y are
hereby au�horized and directed to execute said Agreements.
5. Upon execution of the Preliminary Aareenent by
' the Company, the staff of the Authority are �uthorized and
directed to continue negotiations with the Company so as to
resolve the rem�ining issues nece=sary to the preparation of
the documents necessary to the adoption by the �.uthority e� its
final bond resolution and the issuance and delivery of the
revenue bonds. �
6 . The revenue bonds �nd interest thereon shall not
cons�itLte an incebtedness of the �_uthority or �he City ci
. ` •
, � �Gr f ����
� Saint Paul within the meaning of any constitutional or -
� statutory limitation and shall not constitute or give rise to a
- pecuniazy liability of the Authority or the City or a charge
ag�inst 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 fin�.ncing herein contemplated, the City Council is hereby
requested to consent, pursuant to Laws of Minnesot.a, 1976,
Chapter 234, to the issuance of the revenue bonds herein
' co;�templated and any additional bonds which the Authority may
prior to issuance or from tir�e to time thereafter deem
necessary to complete the financing or to refund such revenue
bonds; and fcr such purpose the Executive Vice President of the
Authority is hereby authorized and directed to forwa=d to the
City Council copies of this resolution and said Preliminary
Agreement and any additional available information the City .
. � Council r,�ay 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 oi the Project and
estimating the principal amount of bonds to be issued to .
finance the acquisition of the Equ�pment and in preparing a
draft of the proposed applicat:on to the Commissioner of
_ Securities, State� of Minnesota, for approval of the acquisition
of the Equip;�ent 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 zll respects
ratified and confirmed .
Adopted: October 28, 1980 �
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A t t e.s t \ /�'i`; • ,� �
Pse sic�e n t"
The Port Authority of �the City
� � of Saint Paul .�
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�/, " �i�' -i!. �..�.%=.J� .
• �_ _�� Secretary '' / .
� . . ' ` � F, f�l �-��� ��'o-o�j
� OM Ol: �12/197 ,
, Rev. : i9/ �J76 �
1 . .
EXPLANATIOM OF ADMINiSTRATIVE OR[?ERS, ; ��a�,��
RESOLUTIONS, AND ORDINANCES
,
Date: Octob�r 28, 1980
RECEtVEp '
T0: MAYOR GEORGE LATIMER p�T 3 � �9$0
FR: E. A. . � �.�OJ�'� Q� •
;
RE: KAPLAN PAPER BOX COMPANY ��
�275,000 EQUIPMENT LEASE - PRIVATE PLACEMENT ',
RESOLUTION N0. 1722
ACTION REQUESTED: • �, ,
�
In accordance with the Laws of M�rrnesota, Ghapter 234, it is requested �hat the
City Council, by Resolution, a draft co�y of which is a�ttached hereto, �pprove
the issuance of revenue bonds in the an�unt of approximately �275,000 tq finance
the acquisition' of a new glueing machine for KapTan Paper Box Company i�i Rivervieav . .
Industrial Park. ,
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PURPOSE ANO RATIONALE FOR THIS ACTION: ' .
. ;
The purpose of .the bond issue is to finance the ac4uisition of a new ql 1nc� a�achine
for Kapl�an Paper Box Company: The bond issue for the equiprr�nt would be �c�te �ii�rcugh
a private placement and done on the credit and security of the Corparatf a�d nat tt�e
Port� Authority. Employment would be increased by approximately one per� n.
�
ATTACHMENTS: ;
Staff Memorandt�m
Draft City Council Resolution '
Port .�ut+�:rity Resolution No. 1722 ;. :
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