271449 WHITE - CITV CLERK ����,���
PINK - FINANCE TT COU�ICIl N
CANARV - DEPARTMENT G I TY OF SA I NT �A 11 L
BLUE - MAVOR File NO•
ouncil Resolution
Presented By
'l:.
Referred To Committee: Date
Out of Committee By Date
WHEREAS:
1 . On June 20, 1978, the Port Authority of the City of Saint Paul adopted Resolution
No. 1355, giving preliminary approval to the issuance of revenue bonds in the initial
principal amount of approximately $900,000 to finance electrical and mechanical improvements
to the area that will accommodate the Jensen and Holden operations, approximately $400,000
for the remodeling and improvement of the office area, and repair and resurfacing of the
parking lot for McGill/Jensen Inc. at their facility located at 655 Fairview Avenue North.
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 adop�ed 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 facilit�te 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 initial principal amount of said bonds will be approxi�
mately $900,000 and that the net interest cost appiicable to said issue will not exceed s
8�, now, therefore, �e 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 thepurposes described in the aforesaid Port Authority Resolution
No. 1355 in the initial principal amount of $900,000 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 Requested by Department of:
Yeas • Nays �
.._�
H a Hcaa In Favor
Hu t HuM �J
Le i e �e�^� �� __ Against By • �-
R e er Maddox
S ves er Showalter
iede�eo
�` � 8 ��8 Form Approved by City Attorney
Adopted by uncil: Date Q
A
Certy�ied Pass� y Council Secretary BY
/
B
A by Ylayor. e —
,Ul A pr v by Mayor Eor S b s icfa to Council
B -- B
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0
. PORT
� ' AUTHQRITY �������
OF THE CITY OF ST. PAUL
Memorondum
TO: BOARD OF COMMISSIONERS � DATE: �une 16, 1978
. (June 20, 1978 Regular Meeting)
FROM: D.G. Dunshee �
SUBJECt: MC GILL/JENSEN INC.
PUBLIC SALE HEARING & PRELIMINARY AGREEMENT
PRIVATE PLACEMENT INDUSTRIAL REVEtJUE 60ND ISSUE - $900,000
1. THE COMPANY
Mr. Frank Beddor, Jr. acquired Printing, Inc. in June, 1967.
In December, 1975, Mr. Beddor acquired the entire operation of
McGill Graphic Arts, Inc. , a division of Buckbee Mears. In
June, 1977, Mr. Beddor acquired all. of the assets of Holden
Printing Co. , Inc. and Jensen Printing Co, , Inc. of Minneapolis.
He has operated the McGill/Jensen/Holden printing operations in
-� separate facilities and proposes to consolidate all printing
operations into one building at 655 Fairview Avenue North, �
St. Paul This is the facility that McGill/Printing, Inc. �
has leased from Buckbee Mears and early this year secured an
opt9on to purchase for $3,000,000.
2. THE �FACILITY
The facility contains 363,960 square feet. Of that space, 256,16Q
is on the first floor, and the remainder on the second floor is
primarily used as office space. This facility is situated on
10.78 acres or 469,768 square feet of land running between Fairview
- Avenue North and Prior Avenue north of University.
At the present time, Controlforms leases 55,000 square feet of space
and will remain as a tenant, and Bissel Type leases 14,000 square
feet and will remain as a tenant. At the present time, McGill
occupies approximately 227,000 square feet of which 70,000 is
now vacant and would accommodate the Jensen/Holden printing
equipment and operations upon their location in St. Paul . The
only portion of the building that currently does not have a tenant
is a 57,000 square foot second floor office area on the west side
or Prior Avenue side of the building.
• , �r�� i�/� .
BOARD OF COM(�1ISSIONERS
June 16, 1978 �
Page -2-
On May 1 , 19;8, an a�praisal was done by Mr. Howard Lawrence, M.A. I. ,
to determine the market value of tn� building at 655 Fairview Avenu�
North. Based on tne appraisal done in May, he has established a
� market value of $4,200,000. Tliisappraised valu� is approximately
40% more than the pur:.hase price of $3,000,000.
3. UNDERWRITING AGREEMENT
Miller & Schroeder Municipals will make a private placement
of a $900,000 revenue bond issue at a rate to be determined for a
term of 1Q years. Proceeds from the bond issue would be used to
finance the electrical and mechanical improvements to the area that
will accommodate the Jensen and Holden o�erations, approximately
$400,000 for the remode1ing and improvement of the office area,
and repair and resur�`acing of tlie parking lot.
The $3,000,000 acquisition price from Buckbee Mears would be secured
through the private placement of a conventional mortgage.
4: su��r�ARv
At the present time, McGill/Jensen employs approximateiy 175 people
a� St. Paul , and they estimate that whan t�e two Minneapalis operat�ons
are transferred to St. Paul , the total emplayment in the facility will
_ incr�as� to a�proximately 400 wi�h a total annual payrall of appr�x-
inately �10 miliion.
The bond issue would be for a term of 10 years, and the company has �
agreed to pay a fiscal and administrative fee to the Port Author�ty
based on our formula of $200 per month per million dollars over the
term. Ti�is would amount to $180 per month �r �2,160 per year ov�r the
term.
zn ke�ping with the Port Authority policy of notifying the Districts
when a proj�ct is proposed, we have contacted pistrict 1T vn �ay ll ,
1978 regarding t�e proposed project. Rs of this date, we have 1^eceiv�d
no 4�t1^itten or oral co�t�tunication from the District regarding the project.
Staff has revie4��ed the 1977 financial statement and pro forma, inter-
Yteti�r�d officers of the company, and recommends approval of the private
placement of th� bond issu°. This issu� would be done autside Port
Autharity R�solutio� 876 and would b2 based on the corporation's
financial statement.
Issuance of the r�venu� bonds would be based on t�e satisfactot�y
placement of a convzntiunal mortgaga for $3,000,000 to permit acquisi-
tion of the build�ng. If a conve�tional mortgage placement could not
be secured, the bond issue would not be sold. Staff recorrnnends approval .
UGD:ca
WHITE - C�TV CLEHK � -
PINK -: FINANCE . ` � T � COUI�C11
6LUE�Y - DAVORTMENT GIT 1 O�` S� I -\�T 1,�UL File NO.
� Council Resolution
Presented By .
Referred To Committee: Date
Out of Committee By Date
WHEREAS:
1 . On June 20, 1978, the Port Authority of the City of Saint Paul adopted Resolution
No. 1355, giving preliminary approval to the issuance of revenue bonds in the initial �
principal amount of approximately $900,000 to finance electrical and mechanical impravements
to the area that will accommodate the Jensen and Holden operations, approximate'�y $400,000
for the remodeling and improvement of the office area, and repair and resurfacing of the
parking lot for McGill/Jensen Inc. at their facility located at 655 Fairview Avenue North.
2. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue bonds
authorized by the Port Autharity 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 adop�ed 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 initial principal amount of said bonds will be approxj-
mately $900,000 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 thepurposes described in the aforesaid Port Authority Resolution
No. 1355 in the initial principal amount of $900,000 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 �he 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.
COUNCILIIEN Requested by Department of:
Yeas Na�'s
Butler � �
Hozza in Favor . �`�
Hunt �r
Levine _ __ Against BY
Roedler
Sylvester
Tedesco
Form Approved by City Attorney
Adupted b�� Council: Date
Certified Y<�ssed b� Council Secretary By -
� B�: . �—�. --
Appro�'ed by l�tayor: Date — — Approved by Mayor for Submission to Council
By� —_ — — --- BY --
, . . , �����`��
Resolution No. T355
RESOLUTION OF
THE. PORT AUTHORITY OF THE CITY OF SAII�T PAUL �
WHEREAS, the purpose of Cnapter 474 , T�iinnesota
Statutes, known as the Piinnesota rSunicipal Inc�ustrial Develop-
ment Act (hereinafter called "Act"j as found and determined by
the legislature is to promote the welfare of the state by th�
active attraction and encouragement and develop;nent of ecor�omi-
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 unempl.oyment; and
WHEREAS� factors necessitating the active pramotion
and development of economically sound inclustry and commerce are
the_ increasing concentration of nopulation in the metropolitan
areas and the rapidly rising increase in the amount and cost
of govern::°^taI services required to meet the needs of the
-.- - increased popu lation and the need for deve�.opmen� of �.and use
wnich wi?1 pro,Tid� an adequate tax base to finance these. increas-
ed costs and access to employmen� opportuniti�s for such popu-
lation; and �
WHEREAS, The Port Authority of the City of Saint Paul
�the "Authority") has received from the McGill Printing Company
�hereinafter referred to as "Company") a xequest that the Author-
ity issu� its revenue bonds (which may be in the form of a single
note) to partially finance the acquisition, installation and
cqnstruction of improvements to existing comm�rcial printing
premises and facilities located at 655 Fairvie�o I�venue No..
(hereinafter collectively called the "Projec�") in the City of
St. Paul, all as is more fully describ�d in the sta�f repart on
file; and
WHEREAS, the Authority desires to facilitate the
selective development of the community, to retain and improve
. it:s tax base and to help it provide �he x-ange of services and
en;ployment opportunities required by its populati:on, 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 bett�een assessed valua-
tion and debt and enhance the image and reputation of the City;
and
� • - . ������
FTHEREAS, the Company proposes to finance the cost
of acquiring the existing premises and facilities �hrough
private financing; and
WH�REAS, the Project to be financed in part by
revenue bonds will result in substantial employment opportunities
in the Project;
��THEREAS, the Authority has been advised by repre-
sentatives of the Co:�►pany that canventional, commercial
financing to pay all of the capital costs of the Project is
available only on a limited basis and at such high costs of
borrowing that the economic feasibility of operating th�
Project �vould be significantly reauced, 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; and
WHEREAS, Miller & Schroeder riunicipals, Inc. {the
"Pl.acement Agent") has made a proposal in an agreement (the
"Placement Agreement") relating to the private placement of
the revenue bonds to be issued to �inance _the Project.
NOW, THEREFORE, BE IT RESOLVED by the Commissioners
of th� Port Authority of the City of Saint Paul, r�iinnesata
as foli o�as: � .
1. On the basis of information available to the
AuthoY�-cy it app�ars, and the Authority hereby finds, that
said Projec� canstitutes prop°rties, used or useful i.n
connection with one or more revenue producing enterprises
engaged in any business �aithin the meaning of Subdiva.sion 1
of Section 474.02 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 inducemsnt to
the Company to undertake the Project, and that the effect of
the Project, if undertaken, will be to encourage the develop-
ment of economically sound industry and commerce and assist
in the prevention of the emergence of blighted and marginal
Zand, and �vill 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 i.ts population, and �aill help to prevent the
movement of talented and educated persons out of ttie state
and to areas �vithin the state where their services may not
be as effectively used and will result in more intensive
aevelopment and use of land within the City and wi11
eventually result in an increase in the City s tax base.
2. Subject to the mutual agreement of the
Authority, the Company and the purchaser of the revenue
bonds as to the dPtails of the lease or other revenue
agreement as defined in the Act, and other docunents
. �������
necessary to evidence and e�fect the financing of the
Project and the issuance of the revenue bonds, the Project
is hereb�� approved and authorized and the issuance of
• revenue bonds of the Authority (which riay be in the form of
a .single note) in an amount not to exceed approximately
$900,000 (other than such additional revenue bonds as are �
needed to complete the Project) is authorized to finance, in
part, the costs of the Project.
3. 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 Placer.z�n�
Agreement. The form of said Agreem�ents have been examined
by the Commissioners. It is the purpose of said Agreenents
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 co�unencerient of . �
the acquisition, installatiori and construction of the
Project with the assurance that there has been sufficient
"official action" under Section 103 (b) oi the Internal
Revenue Code of 1954, as amended, to allow for the issuance
of industrial revenue bonds to finance, in part, the cost. _
of the Project upon agreeTnent being reache3 as to the
ultimate u�tails of the Project and its financing. Said.
Agreements are hereby approved, and the President and
- - Secretary of the Authority are hereby authorized and
direc�ed to execute said Agreements.
� 4. Upon execution of the Preliminary Agreement
by the Company, the staff of the �u�hority are authorized
and directed to continue negotiations with the Company so as
to resolve the remaining issues necessary to the preparation
� of the Revenue Agreement and other docum�nts necessary to
the adoption by the Authority of its final bond resolution .
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 �'aul �aithin the m�aning of any constitutional or
statutory limitation and shall not constitute or give rise
to a pecuniary liability of the Authority oz the City or a
charge against their general credit or taxing pocoexs and
neither the full faith and credit nor the ta�ing powers of
the Authority or the City is pledg?d for the payment of the
bonds or interest thereon.
. • �'`j J�,l�Q .
' � / �`�`#�.l
(, In order to facilitate completion of the .
revenue bond financing hereir. contemplated, the City Cauncil
is hereby requested to consent, pursuant to Laws of Minnesota,
1976 , Chapter 23�, to the issuance of the revenue bonds �
h�rei� con-templated and any ar3ditional bonds whic� the
Autharity may prior to issuance or frorz 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 hzreby authorized
ana directed to forc�ard to the City Council copies of this
� resolution and said Preliminary Agreement and any additional
available information the City Cotincil may request.
Adopted June 20, I978
G' �� • j� .
: . L-�
Attest
� LGti
Presi n
The Por Authority of the Ci.t�
of Saint Paul .
Secretary
. • r-
. PRELIP�INARY AGREEMENZ' � �����
� THYS AGREE�IENT, made and entered. into as of this
. day of , Z978, by and bet��een the PORT
AUTHORITY OF THE CITY OF SAINT PAUL, a public corporatio�
organized and e�isting under the provisions of Minnesota Statutes,
Chapter 458, and a redevelopinent agency within the meaning of
c
Minnesota Statutes, Chapter 474, hereinafter called "Port
Authority" , and McGill Printing Company, a corporation organized
under the laws of Minnesota, hereinafter called "Company" ; •
WITNESSETH:
W�IEREAS: �
• A. The Company and Port Authority intend that
the Company acquire title and install and
- construct improvements to existing
facilities loca�ed on premises described
in Exhibit t� attached here�o and incoxporated
herein by reference, said facilities and
premises and the �improvements thereto being
hereinafter collectively called "Project" ;
B. The parties hereto intend, subject to the
terms, covenants and conditions herein con-
tained, to enter into a Revenue Aqreement
(hereinafter called "Revenue Agreement")
. ;
relating to the Project in the form and
tenor customary �vith respect to industrial
• revenue bond financing in the State of Minne-
. � sota and to finance the improvements ta
the Project through the issuance by the
Port Authority of Industrial Development .
Revenue Bonds (hereinafter called
Bonds) which may, with the consent of
the Port Authority and Company, be in .
the form of a single z�ote.
NOW THEREFORE, in consideration of the mutual covenants
herein contained, it is hereby agreed by and between the par�ies
hereto as follows : .
1. The Company and the Port Authority agree to nego--
� tiate the R?�;znuz Agreemen� in a fox7� and tenor customary wi.tl�z
respect to industrial revenue bond financing in the State of
� Minnesota, including without limitation the provision �or the
following: �
(a) The Revenue Agreement terzn sha11 commence
on the nominal date o� th� Bonds . and sha11 extend
through the final maturity date of the Bonds. �
(bj The Company sha11 agree under the Revenue
Agreement to make monthly payments in the amounts
and at such times as are set out in said negotiated
Revenue Agreement, but in any event suff icient to
pay when due debt service on the Bonds, plus an
' � . ����`�`Z�
administrative �ee per month deter,nined on .
. the basis of $200 . 00 per $1,000,000 of
. Bonds computed in accordance �,�ith the ac�ual
principal amount of Bonds issued. -
(c) Interest on earnings derived frori the
investment of the monthly payments and other monies
�
in the Bond Fund and any reserve establisned for
the Bonds shall inure to the benefit of the Port .
Authority.
(dj The Company shall be entitled to credit
against its last i.nstallments of payments due during
the term of the Revenue Agreement the principal
. amount of any surplus constiruction funds transferred
_: to the Bond Fund and any reserve established for the
Bonds.
(e) The Company agrees that orior to the
commencement o� the construction oi the improv�- -
ments. to the Project, the Company will cause to
be filed �aith the Port Autnority and approved by
its duly authorized agent (i} the Plans and
Specifications for the improvements certi-
.fied by an engineer registered in �he
State of riinnesota and that (ii) all pay-
ment • and performance bonds for the �,�ork to
be undertaken, (iii) all construc�ion contracts,
including any instaZlation contract, (iv) such
�r/ �.�jij
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 construction,
�
acquisition and installation of the Project, and (v)
waivers from the general contractor and all subcon-
. tractors and suppliers of al1 rights against the
Port Authority �or damages to property except such
� rights as they may have to proceeds of such insurance..
Al1 construction contracts entered into for construc-
_ tyng the Improvements described herein shall incl.ude
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.
(i) The Company shall agree to pay all taxes, �
assessmen�s, and other governriental charges that are
or may become due with respecz to the Project.
2. Prior to the issuance of the Bonds, the Company
shall secure private financing for the acquisition of that �
portion of the Project representing the existing facilzties and
improvements.
3. Upon negotiation of the details of said Revenue
Agreement and final determination of the terms of the Bonds,
, . �s i ����
the Port Authority shall thereafter issue said IIonds in accor-
dance with the terms and conditions set forth in an underwriting
agreement and the R�venue Agreement; provided that;
(a) Details of the sale and iss�aance 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 bQ subject to
the issuance of the appzoving. opinion of Briggs and
riorgan, Professional Association� Bond Counsel for the
Port Authority and for the City of Saint Paul, and
the furnishing of all documents, resolutions, agree-
ments, financial information� certifications, and
representations necessary to the sale and �3elivery of
the Bonds, including those which 4re custoMari2y used
and those which are customary and necessary to comply
with all state and federal laws, regulations, rulings
and decisions.
4. Regardless of whether or no� for any reason the
Bonds are issued, the Company shall upon demand neverthsless
promptly pay or reimburse the Port Authority for the payment of
all out-of-pocket expenses incurred by the Port Authority in
connection with the Projec� including ��rithout limitation a1I
Band 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 incid�nt to any environmental studies required to be
hereafter made in connection with the Project.
- �������
5. This Agreement is subjec� to the approval of
the Bonds by the City Council of the City of Saint Paul as
provided by Chapter 234 of the Laws of AiinnesQta for 19?6.
IN WZTNESS tiVHEREOF, the parties hereto have caused
. these presents to b2 executed as of the day and year first
above written.
�
In the Presence of: PORT AUTHORITY OF THE GITY
OF SAINT PAUL �
. � j
.� `
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��.
Its� •
By
Its
(Corporate Seal)
� ,
• ' N i �`2`�t�►7
In the Presence of : 2�icGILL PRINTIiJG COPdPANY
� . . . . gy . . . . . . • . • . • . . • � . • . � . - • • - � . . .
Its
� - . By . . . � . . . . � . • . . : . � � . • - . , . . . . . .
Its '
(Corporate Seal) '
z