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273359 WHITE - CITV CLERK COIIIICII �� 1�� PINK � - FINANCE G I TY OF SA I NT PALT L CANARV - DEPARTMENT �„ � RM �- BLUE - MAVOR File NO. ouncil Resolution Presented By Referred To Committee: Date Out of Committee By Date WHE�tEAS: 1 . On July 9, 1979, the Port Authority of the City of Saint Pau1 adopted Resolution No. 1507, giving pre1iminary approval to the issuance of revenue bonds in the initial principai amount of approximate1y $620,000 for the purpose of acquiring, remodeling and repairing two buildings containing 36,662 square feet and 23,520 square feet on a 114,650 square foot site from McGill/Jensen Inc. on North Fairview Avenue for Battery & Tire Warehouse Inc. 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 , sha11 be issued on1y with the consent of the City Councii of the City of Saint Paul , by resolution adopted in accordance with 1aw; 3. The Port Authority of the City of Saint Paul has requested that the City Counci1 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 Pau1 , subject to finai approva1 of the details of said issue by the Port Authority of the City of Saint Paul . RESOLVED, by the City Counci1 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 Reso1ution No. 1507, the exact details of which,, including, but not limited to, provisions re1ating to maturities, interest rates, discount, redemption, and for the issuance of additionat bonds are to be determined by tfit�Port Authority, pursuant to resolution adopted by the Port Acrthority, and the City CounciT hereby authorizes the issuance of any additional bonds (inc1uding refunding bonds) by the Port Autharity, found by the Port Authority to be necessary for carrying out the purposes for which the aforesaid bonds are issued. ��:; COUNCILMEN Yeas Nays Requested by Department of: / .� � [n Favor Hunt Levine �__ Against BY Maddox Showalter Tede �� i g 1979 Form Approve by City Attorney Adopted Council: Date L/��'"�� __.. 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Augu�t 29, 1979 , • . ` � - • � �Flintkote Companq � Building .Materia�s,Manufacturing Divisioa � , � 1120 East Seventh St. St. Paul, Tiinnesota •Dear GeuClemenr i � ; , _ , . , ; , Attached is a copy of Council F31e Yo. 273377, published in the ' � St. ,Paul Lega� Ledger on Au�ust 25, 1979, granting permission to _ . Flintkote Canpany to construct and maintafn a communi,cation cabls - across East 5eventh Street., tJe wou3.a lik.e to c$11 your attention : ; . to Co�dition No. 1 which requires a �urety bond in the amount of . $kQ,000 •and Condition .Jo. 6 which requir�s a utritten acceptance be 'fi�,ed with our office witliin 20 days after publiCation.o£ the ordinance. � , � � , Ver� trulq your's, ' 1 � ; Rdse I�tix - ; City Clerk . • AC�ach. , , . dcr , � ' , . � : . � , . � . � . . . e. . . � . . . � r , � . . . � � . . . .. .f . , � .. � - . ' . . . . . . .. . .. . . �. . . . . . . . / . . -, . . � , . � . . .. � . . . . •,I � . . � � . . . � � . . . ' _ � � ' . . " ' . \ � . � . - .., . . . , � . . . . � . �. . ' : ' . oM oi: ia/�.y7s ` .�► ` ' R�. : 9/8/76 �� EXPLANATION OF ADM�PSTSTR.�ITIVE ORDERS, RF:SOLliTIONS, AND 4�D�NA,��ICES i�j �= .. _ �r� : .r.:�•_ ; � . � , Date: June l2, 1979 r - � ` .a � - ; � � �. � �� . � -' `� JUL. 6 .r7Q �o: r��oR c�ca�c� r�TZr�R : Al�YOR'S o��cE gg: Thanas J. Eggum, Pwblic Works Office Engineer -' gE; Placeme�t oP a� private carNnunicartion cable pyer Earst SeVenth St�eet at . 1120 East Seventh Street. � . . - � . . . . . . . r . . . . . . '. _ . . . .. . .�� . . � . .� ... . � . : . � . . . . �. A�TION �RE4UESTEII: � Ordinence would permit the Plintkcc�tte Gc�pat��r t4_place a p�tY�te A �onrnunicattons cable over �ast Seventti Street connectt�g tts ef�`tce and Manu- facturing Plant bailding on either .side of East Seventh Street, Resolntion would a'l low Pl intkote Comp�ny to put up the cc�nunicat�ons ca61.e ne�v, pending the adoption and effecti've date of Ordi`nance, , ` . � : . � .+ . _ . I PC�FtPOSE'ALVD �tATI4NALE FOR T�IS p,CTTOF�:: Qrdinance No. 1014� t Councti �ile No, � 165218 :aPProved August 28, 1953, 9�'ants permisston for a gtmtt�r tnstall�tttan� : ! at a different TocatTon. ,: - A3'T�4kIiYiENT5:, � . Qrd i nance. 2. ResolutPon. . : ' . . ACCEPTANCE OF TERMS AND CONDITIONS OF RE50LUTION GRANTING PERMISSION TO PERFORM WORK WITHIN THE PUBLIC RIGHT-OF-WAY Saint Paul, Minnesota October 3, 1979 To The Honorable City Council Saint Paul, Minnesota Ladies & Gentlemen: The undersigned petitioner does hereby accept and agree to comply with the terms and conditions of Council File No. 273377 adopted by the Council on August 14, 1979. FLINTKOTE, INC. By -�/� �J...�..c�.� Its Plant Manager and Authorized Agent � �PORT � AUTHORITY �� OF THE CITY OF 5T. PNUL Memorandum � TO: Board of Commissioners oAT� July 6, 1979 Special Meeting Ju1y 9, 1979 FROM: D.G. Dunshee SUBJECT: BATTERY & TIRE WAREHOUSE INC. $620,000 REVENUE BOND ISSUE RESOLUTION N0. 1509 - PUBLIC SALE HEARING RESOLUTION N0. 1507 - PRELIMINARY AGREEMENT 1 . THE COMPANY Battery & Tire Warehouse Inc. began operations in St. Paul in 1947 and has been headquartered here since that time at various locations. In 1958 they purchased a multi-story building at 909 Selby Avenue. The company has now outgrown that facility and needs to find a new location in St. Paui in order to retain their headquarters in the city. The company started as a supplier of batteries to service stations, garages, construction companies, industrial accounts, and others through- � out Minnesota, Wisconsin, Iowa, and the Dakotas. They have expanded their product line from batteries to include tires, cables, terminals, brakes, and other related products. In the year ending April 30, 1978, the company had annual sales in excess of $5,000,000 and a net worth of $711 ,003. 2. THE PROJECT The company proposes to purchase from McGill/Jensen Inc. two buildings containing 36,662 square feet and 23,520 square feet situated on a site containing 114,650 square feet on North Fairview Avenue. This parcel has rail trackage and contains 2.63 acres. These buildings were not part of the original project which was partially financed by a Port Authority bond issue in 1978 for McGill/Jensen. In addition to the acquisition of the buildings for $450,000, the company proposes to finish a 3,200 square foot office area on the second floor of the large building and remodel a portion of the first floor for City desk and separate office. In addition to that space, the company will be installing heaters, weather stripping, replacing truck doors, and closing five other truck doors, and making other repairs necessary to use the facility. These repairs are estimated to cost an additional $100,000. The repairs are estimated to cost an additional $1Q0,000. Mr. Robert Thees has agreed to deposit $25,000 equity in the construction fund at bond closing for improvements to the building. Board of Commissioners � July 6, 1979 Page -2- Under amendments to Chapter 474, approved by the Minnesota Legislature this spring, the Port Authority published notice in the Lega1 Ledger and the St. Paul Dispatch-Pioneer Press on June 9 and 11 respectively that the proposed project would be considered by the Port Authority Commission on Tuesday, June 26. The public hearing was held on the 26th, which meets the requirements of the State statute. If the project is approved by the Commission today, a formal application will be sub- mitted to the Commissioner of Securities before the bond issue can be closed. On May 18, 1979, the Port Authority notified District 11 of the proposed project. As of today the Port Authority has received no written or oral comnunication regarding the project. The company estimates they will be able to add an additional five persons to their present employment of 40 when the project is completed. Mr. Robert Thees, President of Battery & Tire Warehouse, has indicated he wishes to remain headquartered in St. Paul and this is the only building presently available in the city that meets his space require- ments, and if he is unable to lease this facility, he will consider � other buildings that he has looked at outside of the city of St. Paul , 3. FINANCING The proposed financing of the facility would be done under Resolution No. 876. Proceeds from the bond issue would be as follows: Construction $522,450 Bond Issue Expense 15,000 Capitalized Interest - 3 Months 10,850 Debt Service Reserve 53,100 Discount 18,600 TOTAL $620,000 In addition to the monthly rent, the company will pay a fiscal and administrative fee as follows: First 10 years $3Q0 per month or $3,600 per year Second 10 years 4Q0 per month or 4,800 per year Final 10 years 500 per month or 6,000 per year 4. UNDERWRITING AGREEMENT Mi11er & Schroeder Municipals has agreed to underwrite a bond issue for a 30-year term commencing September 1 , 1979 and terminating August 31 , 2009. The interest rate for the bond issue will be set ten days prior to closing. Board of Commissioners July 6, 1979 � Page -3- 5. TERMS OF THE LEASE The proposed agreement is for a period of 30 years and provides an option to purchase the building at the end of the lease for 10� of the bond issue cost. The Port Authority will receive the following income over the term of the lease: Option to Purchase $ 62,000 Fiscal and Administrative Fee 144,000 Debt Service Reserve Earnings - 8� 132,600 Sinking Fund Earnings 31 ,620 TOTAL $370,220 Mr. Robert Thees, who has a personal net worth of $936,000 as of Apri1 30, 1979, has agreed to personally guarantee the bond issue. In Ju1y 1978, Mr. Howard Lawrence, MAI, appraised the building and established a market value of the land and building at $460,OOQ, He . has reviewed the proposed improvements to the building and estimates that the new value following completion of the improvements will be $570,000, Based on Mr. Lawrence's market value appraisal of $570,000 � and the cash deposited in the debt service reserve of $53,100, this exceeds the amount of bonds proposed to be issued. The per square foot debt service on the building is approximately 90Q per square foot. Mr. Lawrence, in his appraisal , estimated that the market value rental for space in the building would be $90,000, or approximately $40,000 more than the debt service. After expenses and taxes are deducted from the estimated gross rental , there would be a surplus in the rental account above and beyand bond issue debt service. 6. RECON,PIENDATIONS Staff has reviewed the project in detail , the financial statements of the company, and the appraisal of the property, and recommends approval of Resolution No. 1507 authorizing the issuance of bonds in the amount of �o20,Gu�. DGD:jmo °� , � ��•��",� � - � . Resolution No. 1507 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 Develop- ment Act (hereinafter called "Act") as found anc7 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 o.f blighted and marginal lands and areas of chronic unemployme�t 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 of population in the metropolitan areas and the rapidly rising increase in the amount and cost o� 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 Battery & Tire Warehouse, Inc. , a Minnesota corporation (hereinafter referred to as "Company") a request that the Authority issue its revenue bonds to finance the acquisition and modification of two buildings . located on North Fairview Avenue in the . City of Saint Paul for use as an office, mechanical anc3 industrial facility (hereinafter collectively called the "Project" ) , all as is more fully described in the staff report on file; and � WHEREAS, 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 relationship between assessed valuation and debt ana 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; . .� WHEREAS, 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 Authority that with the aid of revenue bond financing, and its resulting low borrowing cost, the Project is economically more feasible; WHEREAS, Miller & Schroeder Municipals, Ina. ( the � "Underwriter") has made a proposal in an agreement (the "Underwriting Agreement") relating to the purchase of the revenue bonds to be issued to finance the Project; WHEREAS, the Authority, pursuant to Minnesota Statutes, Section 474. 01, Subdivision 7b did place 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 the Authority finance the Project hereinbefore described by the issuance of its industrial revenue bonds; and - WHEREAS, the Authority did conduct a public hearing pursuant to said notice at which hearing all persons, who appearec7 at the hearing were given an opportunity to express • their views with respect to the proposal. NOW, THEREFORE, BE IT RESOLVED by the Comrnissioners of the Port Authority of the City of Saint Paul, Minnesota 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 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 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; 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 movement of talented and educated persons� out of the state and to areas within the . state where their services may not be as effectively 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 of the City of Saint Paul and in furtherance of the general plan of development to assist the Company in financing the Project. 2. Subject to the mutual agreement of the Authority, the Company and the purchaser of the revenue bonds as to the details of the lease and other documents necessary to� evidence and effect the financing of the Project and the issuance of the revenue bonds, the Project is hereby approved and authorized and the issuance of revenue bonds of the Authori�y, which may be in the form of a single note, in an amount not to exceed approximately $620, 000 (other than such additional revenue bonds as are needed to complete the Project) is authorized to finance the costs of the Project. 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 her approval, and other officers, employees and agents of the AUTHORITY are hereby authorized to provide the Commissioner with such preliminary information as . � she 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 Underwriting Agreement. The form of said Agreements have been examined by the Commissioner.s. 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 comnencement 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 F ., , . 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 Preliminary Agreement by the Company, the staff of the Autho rity are authorized and directed 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 resolution and the issuance� and delivery of the revenue bonds; provided that thz President (or Vice-President if the President is absent) 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 Hiinnesota Statutes, Section 475. 60, Subdivision l, to accept a final offer of the Underwriters made by the Underwriters to purchase said bonds and to execute an underwriting agreement setting forth such offer on behalf of � the Authority. Such acceptance shall bind the Unaerwriters to said offer but shall 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 and interest thereon shall not constitute an indebtedness of the Authority or the City of Saint Paul 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 f ull 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 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 herein contemplated and any additional bonds which the Authority may prior to issuance or from time to time thereafter aeem 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 forwarci to � . ... . , , � • t��/`-°. , l� 0 �. 'v'r ,a � the City Council copies of this resolution and saici Preliminary . . Agreement and any additional available inforr.iation 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 describin.g the general nature of the Project and estimating the principal amount of bonds to be issued to finance the Project and in preparing a draf t 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. , Adopted July 9, 1979 %� • . Attest _ � � � P id t . The Port Authority of the City � of Sai t Paul � � �-¢�� Secretary � •` � �_� PORT AUTHORIN OF THE CIN �F SAINT PAUL 25 WEST FOURTH STRFET SUITE 1'36��D � ST. PAUL, MINNESOTA 55102 (612) 224-5686 - --�_� �P' ' �� - �.��. , . t � �'�t��:��L! , �� . July 10, 1979 � �,, • `' " � : s� � �.. . ��. ,J�� `j �979 Mr. Gary S to ut MAYOR'S � Director Department of Planning and Economic Developrr�nt Lowry Annex St. Pau1 , Minnesota 55102 SUBJECT: BATTERY & TIRE WAREHOUSE INC. $620,000 REVENUE BOND ISSUE Dear Gary: 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 revenue bonds to finance the acquisition of two buildings containing 36,662 square feet and 23,520 square feet on a 114,650 square foot site from McGili/Jensen Inc. on North Fairview Avenue for Battery & Tire Warehouse Inc. The company also proposes to finish a 3,200 square foot office area on the second floor of the large building and remodel a portion of the first floor for City desk and separate office. They also propose to make repairs to the facility. In addition to the staff inemorandum, we are attaching a draft copy of the proposed City Councii Resoiution and a copy of Port Authority Resolution No. 1507 which authorized the sale of bonds in the amount of $620,000. Your expeditious handling of this matter will be appreciated. u truly, Eu�ene A. Kraut Assistan t Executive Vice President EAK:jmo cc: R. Broeker ROBERT F.SPRAFKA EUGENE A KRAUT,C.I.D. DONALD G.DUNSHEE,C.I.D. CLIFFORD E.RAMSTED RONALD O.SCHETTLE EXECUiNE VICE PRESIDENT ASSISfANf EXECUfNE VICE PRESIDEM DIRECTOR,INDUSTRIAL DEVELOPMENT CHIEF ENGINEER CHIEP ACCWNTANT COMMISSIONERS GEORGE W.WINTER ROSALIE L BUTLER ARTHUR N.GOODMAN G.RICHARD SLADE RUBY HUNT LOUIS H. MEYERS WILLIAM J.SEIFERT PRESIDENT VICEPRESIDENT SECREfARV TREASURER � C.I.D, Certified Industrial Developer �Z