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C A N A R V - D E P A R T M E N T G I T Y O F S A I N T 1 A ll L ��� ,'j����
BLUE - MAVOR File NO. A
ouncil Resolution
Presented By
Referred To Committee: Date
Out of Committee By Date
WHEREAS:
1 . On May 31 , 1978, the Port Authority of the City of Saint Paul adopted Resolution
No. 1351 , giving preliminary approval to the issuance of revenue bonds in the initial
principal amount of approximately $770,000 to finance the expansion and improvements to
Farmers Union Grain Terminal Association's facility at Chestnut Street and Shepard Road.
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 .
4. It is estimated that the ini�ial principal amount of said bonds will be approxi-
mately $770,000 and that the net interest cost applicable to said issue will not exceed
8%, now, therefore, be it
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. 1351 in the initial principal amount of $770,000 at a net interest cost of not to
exceed 8%, 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
Yeas Nays Requested by Department of:
Butler �
Hozza In Favor
�
_ '—,=='==� _ � __ Against BY
I�X Maddox
Ted� Showalter
,�� � 5 �� Form Approved by City Attorney
Adopted by Council: Date — O
Certified ; e by ounc , cret� BY- �
B,, ��l
Ap rov by :Vlavor: te _ ,,,�,�o .n�_ Approv by Mayor for Submissi to ou cil
�J R � .r w
By BY
pUBLISHED JUN Z 4 197�
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Resolution No. 1351
RESOLUTTON OF
THE PORT AUTHORITY OF THE CITY OF SAINT PAUL
ZaHEREAS, the purpose of Chapter 4?9, Minnesota
Statutes, known as the Minnesota Municipal zndustrial Deve].op--
ment Act (hereinafter called "Act") as founcl and determined by
the legislature is to promote the welfare of the state by the
active attraction and encouragement and development af economi-�
cally sound industry and commerce to prevent so far as possible
the emergence of blighted and marginal lands and areas of chronic
unemploym�nt and to aid in� the development of existing areas
of blight, marginal land and persistent unemployment; and
WHEREAS, factors necessitating the active promotion
and GcV21G�::�°nt of economically sound industry and commerce are
tne increasi:^g concentration of population in the metropolitan
areas a=.d the rapidly rising increase in the amount and cost
of governmsntal services required to meet the needs of the
increa5ed population and the need for development of �and use -
tahich caill provide an adequate tax basz to finance these a.ncreas-
ed costs and access to employment opportunities for such po�u�
lation; and
WHEREAS, The Port Authority of the City o� Saint Paul.
(the "Authority") has received from the Farmers Una.on Grain �
Terminal Association (hereinafter referred to as "Company°}
a request that the Authority issue its revenue bonds to
finance improvements to existing grain terminal facila.ties
located at Chestnut and Shepard in St. Pau�. (said improvements
hereinafter called the "Project") all as is mare fully
described in the staff report on file; and
WHEREAS, the Authority desires to facilitate the
selective development of the community, ta retain and imprave
its tax base and to help it provide the range of services and
employment opportunities required by its nopulation, and said
Fr.oject �aill assist the City in achieving that objective. Said
Project will help to increase the assessed valuation of the City
�nd help maintain a positive relationship hetween assessed t�alua-
tion and debt and enhance the image and reputation of the City;
and
WHEREAS, the Project �to be financed by xevenue
bonds will result in substantial employment opportunities
in the Project;
� �afIEREAS, 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_ borroc�ing
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 �inancing,
and its resulting low borro�•�ing co�t, the Project is econom-
ically more feasible; and
WHERE�S, P�iller &. Schroede� Municipals, Tnc. (the
"Underwriter") has made a proposal in an agreement (the
"Underwriting Agreement") relating to the purchase af the
revenue bonds to be issued to finance the �roject.
NOW, THEREFORE, BE IT RESOLVED by the Conmissioners
of the Port Authority of the City of Saint Pau1, r9innesota
as follows : "
l. On the basis 'of information ava�.lable to the
Authori�y it appears, and the Authority hereby �inds, that
said Project constitutes properties, used or use�ul in
co:�nectior_ �•�ith one or more revenue producing enterprises
engaged in any busi.ness within the meaning of Subd?vision 1
or Section 474. 02 of the Act; that the availabilx•ty oi the
financing under the Act and �•rillingness of the Authority to
furnish such financing will be a substantia:l inducernent to
the Company to undertake the Project, and that the effect of
the Project, if undertaken, will be to increase the port� s
volume of commerce, grovide adeauate terminal faca,Iita.es
functionally related and subordinate to dock faci].ities
open ta all upon reasonable and equal terms, encourage the
develapment of economically sound industry and comm�rce and
assist in the prevention of the emergence oi b]_ighted and
marginal land, and wil.l help to prevent chronic unempl.ayment,
and tvil.l help the City to retain and improve its tax base
and provide the range of services and enployment oppor-
tunities required by its population, and will help to
prevent the movement of talented and educated per.sons out
of the state and to areas within the state �ahere their
services may not be as effectively used and cai11_ result in
more intensive development and use of land �aithin the City
and will eventually result in an increase in the City' s tax
base.
2. Subject to the mutual agreement o� the
Authority, the Company and the purchaser of i:he revenue
bonds as to the details of a revenue agr_eement as defined
����.`���
in the Act, and other documents necessary to evidence and
effect the �inancing o£ the Project and the issuance of
revenue bonds, the Project is hereby approved and authorized
and the issuance of revenue bonds of the Authority (which
may be in the form of a single �note} in an amount not to
exceed approximately $810,000 (other than such additional.
revenue bonds as are needed to complete the Project) is
authorized to finance the costs of the Project.
3. There has heretofore been filed with the
Authority a form of Preliminary Agreemznt 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 Cammissioners. It is the purpose of said Agreements
to evidence the commitment of the parties and their intent5.ons
with respect to the proposed Project in orc�er that the
Company may proceed without 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 Tnternal
Revenue Code of 1954, as amended, to a11o�a �or the iss�ance
of industrial revenue bor,ds to finance the entire cost of
the Project upon agreemznt being reached as to the ultimate
details of the Project and its financing. Said Agreem�nts
- are hereby approved, and the President and Secre�ary of_ the
Authority are hereby authorized and directed ta execute
said Agreements.
� 4. Upon execution of the Preliminary Agreement .
by the Company, the staff of the Authority are authorized
and directed to continue negotiations ��ith the Com�any so as
to resolve the remaining issues necessary to the preparation
of the revenue agreement ancl other documents necessary to
the adoption by the Authority of its final bond resoluta.on
and the issuance and delivery of the revenue bonds.
5. The revenue bonds and interest thereon shall
not constitute an indebtedness of the Authority or the
City of Saint Pau1 within the meaning of any constitu--
tional or statutory limitation and shall not constitute or
give rise to a pecuniary liability of the nuthority 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 bonds or interest thereon.
6. In order to facilitate completion oi the
reveriue bond financing herein contempZated, .the City Council
is hereby requested to consent, pursuant to Laws of Minnesota,
1976, Chapter 234, to the issuance of the reveriue bonds
herein contemplated and any additional bonds which the
Authority may prior to issuance or from time to time
thereafter deem necessary to complete the Project or to
refund such revenue bonds; and for such purpose the Execu-
tive Vice President of the Authority is hereby author�zed .
and directed to forc�ard to the City Council copies of this
resolution and said Preliminary Agreement and any addi- �
tional available information the City Cauncil may request.
Adopted I�tay 30, 1978
�
Attest �� -
Presi , "t '"
Tne Port Authority of the City
!of Saint Paul
Secretary
- . '.j � ,�
� ( . .
,. . . ����..�1.��
PRELIMINARY AGREEMENT
THIS AGREEMENT, made and entered into as of this �
day of , 197a , by and between the PORT
AUTHORITY OF THE CITY OF SAINT PAUL, a public corporation
organized and existing under the provisions of Minnesota Statutes,
Chapter 458, and a redevelopment agency within the meaning of
Minnesota Statutes, Chapter 474, hereinafter called "Port
Authority" , and Farmers Union Grain Terminal Association,
a cooperative corporation organized under the laws of Minnesota,
hereinafter called "Company" ;
WITNESSETH:
LaHEREAS : .
A. The Company and Port Authority intend that
improvements be made to existng facilities
located on premises described in Exhibit A
attached hereto and incorporated herein by
reference, said improvements being herein-
after called "Project" ; '
B. The parties hereto intend, subject to the
terms, covenants and conditions herein can-
tained, to enter into a revenue amreement
(the "Revenue Agreement") relating to the
Project, and in the form and tenor cus-
- tomary with respect to industrial revenue
bond financing in the State of Minne-
� sota and ta finance the acquisition, in-
stallation and construction of the Project
through the issuance by the Port Authority of
Industrial Development Revenue Bonds (here-
inaft$r called Bonds) which may, with the
consent of the Port Authority and Company,
be in the form of a single note, and,
if appropriate, a interim note or
notes payable from the proceeds of the
Bonds pursuant to Minnesota Statutes,
Chapters 458 and 474.
NOW THEREFORE, in consideration of the mutual� covenants
rerein cantained, it is hereby agreed by and between the parties
heret� as fo?lo�7s:
1. The Company and the Port Authority agree to nego-
tiate the Revenue Agreement in a form and tenor customary with
respect to industrial revenue bond financing in the State of
Minnesota, including without limitation the provision for the
following:
(a) The Revenue Agreement term shall commence
on the nominal date of the Bonds and shall extend
through the final maturity date of the Bonds.
(b) The Company shall agree under the Revenue.
Agreement to mak� monthly payments in the amounts
and at such times as are set out in said negotiated
Revenue Agreement, but in any event sufficient to
pay when due debt service on the Bonds.
(c) Interest on earnings derived from the
investment of the monthly payments and other monies �
in the bond fund and any reserve established for
the Bonds shall inure to the benefit of the Port
Authority. ,
(d) The Company shall be entitled to credit
against its last installments of payments due during
the term of the Revenue Agreement the principal
amount of any surplus constructian funds transferred
to the bond fund and any reserve established tor
the Bonds . . .
(e) The Company agrees that prior to the
commencement of any part of the Project, the
- Company will cause to be filed with the Port
� Authority and approved by its duly authorized
agent the Plans and Specifications for the entire
Project certified by an engineer registered in
the State of Minnesota and that with respect to
at least that part of the Project the Company
then wishes to undertake the Company will first
cause to be filed with the Port Authority and
approved by its duly designated agent, (i) all �
payment and performance bonds for the work to
be undertaken, (ii) all cor_struction contracts,
including any installation contract, (iii) such
builders risk, installation floater, and liabil-
� ity insurance as will fully protect the Company,
contractor and Port Authority (who shall be
named as an additional insured or loss payees) as
their interests shall appear, against risk of loss
or damage to the Project and Project premises and
against claims which may arise from the construct�on,
acquisition and installation of the Project, and (iv)
waivers from the general contracto� and all subcon-
tractors and suppliers of all rights against the
Port Authority �or damages to property except such
rights as they may have to proceeds of such insurance.
All construction contracts entered into for construc-
ting zhe Project described herein shall include
provisions that the wages paid to skilled and un-
skilled labor� shall not be less than the prevailing
wage rates currently in effect in the City of
Saint Paul.
(f) The Company shall agree to pay a11 taxes,
assessments, and other governmental charges that are
or may become due with respect to the Project.
2. Upon negotiation of the details of said Revenue
Agreement and final determination of the terms of the Bonds,
the Port Authority shall thereafter issue said Bonds in accor-
dance with the terms and conditions set forth in an underwriting
agreement and the Revenuz Agreement; provided that:
' ����..����
(a) Details of the sale and issuance of the
� Bonds to be issued by the Port Authority shall be
� subject to final approval by the Company and the
Port Authority.
(b) Issuance of said Bonds shall be subject to
the issuance of the approving opinion of Briggs and
Morgan, Professional Association, Bond Counsel for the
Port Authority and for the City of Saint Pau1, and
the furnishing of all documents, resolutions, agree-
ments, financial information, certifications, and
representations �necessary to the sale and delivery of
the Bonds, including those which are customarily used
and those which are customary and necessary to comp].y
with all state and federal laws, regulations, rulings
and decisions.
3. Regardless of whether or not for any reason the
Bonds are issued, the Company shall upon der.land nevertheless
promptly pay or reimburse the Port Authority for the payment of
all out-of-pocket e�penses incurred by the Port Authority in
connection with the Project including without limitation all
Bond Counsel and other legal fees incurred in the preparation
of this Preliminary Agreement, the negotiated Revenue Agreement,
the underwriting agreement, other related documents, and all
costs incident to any environmental studies required to be
hereafter made in connection caith the Project.
4. This Agreement i�s subject to the approval of
the Bonds by the City Cou�cil of the City of Saint Paul as
provided by Chapter 234 or the Laws of Minnesota for 1976 .
� IN WITNESS WHER�OF, the parties hereto have caused
these presents to be executed as of the day and year first
above written.
In the Presence of : PORT AUTHO Y OF THE CITY
OF SAI PAUL
�
� � /" �
$ j� � � � GL%
ItS
By
Its
(Corporate Seal)
In the Presence of: FARMERS UNION GRAIN TERMINAL
ASSOCIATION
By
Its
By
Its
(Corporate Seal)
' RORT � -
AUTH � RITY �'���.���
OF THE CITY OF ST. PAUL
Memorandum
TO: Board of Commissioners DAT� May 25, 1978
Meeting May 30, 1978
,,
v�
FROM: D. G. Duns � �
�``
SUBJECT: FARMERS UNION GRAIN TERMINAL ASSOCIATION EXPANSION AND IMPROVEMENT--$770,000
CHESTNUT STREET AND SHEPARD ROAD ELEVATOR
RESOLUTION N0. 1351
Farmers Union Grain Terminal Association owns a large elevator complex at
the intersection of Shepard Road and Chestnut Street. The Port Authority
owns the loading facility on the river side of the terminal which we presently
lease to Farmers Union. The company has asked that we consider the issuance
of $770,000 in industrial development revenue bonds under a private placement
to finance the improvements to the complex. These improvements include the
exterior painting and repair of the facility.
Since the elevators are so visible from the downtown and river portions of
the area, it would provide a significant improvement in the overall appearance
of the downtown St. Paul skyline. In addition to the resurfacing and re-
painting of the elevators, the company also proposes to construct an additional
truck dump facility. Total proceeds from the bond issue would be as fallows:
Painting and repair $550,000
Dump Facility 220,000 .
Capitalized Interest 23,900
Expenses 8,000
Placement Fee 8,100
TOTAL $810,000
In addition to the income the Port Authority would receive from the sinking
funds, there would be a fiscal and administrative fee of $162.00 per month.
The term of the bond issue would be for a period of 10 years commencing
July 1 , 1978 and terminating June 30, 1988.
Staff recommends approval .
DGD:jmo
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. OM Ol . .. 12/1975
. . Rev. : 9/8/76 _
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EXPLANATION OF ADMINISTRATIVE ORDERS, ; ;����-�
RESOLUTIONS, AND ORDINANCES �-�
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' �. . . . . - X3 1::
Date: May 3'[� .1978 � � . ;`� ; +1'
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� FR: E Ik.:�_Kraut; S �1 Por-t�Authortty . -- - _ " - - - - _ . ._: __,._:�:
_ _ .�,
RE: FARMERS UNION GRAIN TERMINAL ASSOCIATION EXPANSION AND IMPROVEMENT--$770,000 �
CHESTNt1T STREET AND SHEPARD ROAD ELEVATOR
RESOLUTION N0. 1351 � � . .
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ACTION REf�UES7ED: ' ,
Tn 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 approximately
$770,000 in revenue bonds for the purpose of financing the expansion and improvements
to their facility at Grain Terminal No. 1 . �
PURPOSE AND RATIONALE FOR THIS ACTION:
The purpose of the bond issue is to. finance the expansion and improvements, which include �
exterior painting and repafr, .ta Farmers Union Grain Terminal .Association's facility at
Chestnut Street and Shepard Road. � :
Since this bond issue is being privately placed the Port Authority is not in any way
pledging its resources to retire these bonds in the event of default.
When the riparian r�ghts lease was renegotiated two years ago the conditions included pro- �
visions for Farmers Union to repair and improve the aesthetics so that the entrance to St.
Paut from Sehpard Road was more attractive. A substantial part of this bond issue will be
used for aesthetic improvements. _
ATTACHMENTS• � �
Staff Memorandum � .
Draft City Council Resolution
Port Authority Resolution No. 1351 � �
Preliminary Agreement _
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