96-1341 Council File # ��
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9���s'�� Ordinance #`
Green Sheet # 3 �1 � S
ORDINANCE
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CITY OF PAUL,NIINNESOTA
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Presented By
Referred To Committee: Date
1
2 An ordinance granting authority to the Port Authority of the City of Saint Paul to issue and sell the bonds
3 in the aggregate principal amount not to exceed $ , and any bonds to refund such bonds, to
4 secure such bonds with a pledge of the full faith, credit and resources of the City of Saint Paul, and to use
5 the proceeds derived from the sale of such bonds to pay the cost and expense necessarily to be incurred by
6 said Port Authority for acquisition of lands, environmental remediation, construction of infrastructure
7 improvements and the relocation of owners, occupants and tenants, pursuant to the provisions and by
8 authority of Minnesota Statutes, Chapter 469, as amended, and prescribing the amount and form of such
9 bonds and the manner for establishing the rate of interest thereon.
10
11 WFiEREAS, on August 23, 1994 the Port Authority of the City of Saint Paul (the "Port Authority")
12 adopted its Resolution No. 3489, finding that the land commonly known as the Williams Hill Site is blighted
13 and marginal properties within the meaning of Minnesota Statutes, Sections 469.048 et seq., and establishing
14 and crea.ting the "Williams Hill Industrial Development District"; and
15
16 WHEREAS, the City of Saint Paul, Minnesota (the "City"), has authority under Minnesota Statutes,
17 Section 469.178, Subd. 2, to issue general obligation bonds payable from tax increments of a tax increment
18 district created by the Port Authority, and the Port Authority has authority under Minnesota Statutes, Section
19 469.060, to issue bonds for its purposes in anticipation of income from any source which are secured by the
20 full faith, credit and resources of the City, and pursuant to this Ordinance and Section 3.4 of that certain
21 Loan Agreement between the City and the Port Authority (the "Loan Agreement") evidencing the CDBG
22 Loan (as hereinafter defined), the Port Authority will issue bonds to which are pledged both tax increments
23 and the full faith, credit and resources of the City; and
24
25 W�IEREAS, on October 22, 1996, the Port Authority adopted its Resolution No. expressly
26 requesting the authorization of the Council of the City of Saint Paul, pursuant to Minnesota Statutes, Section
27 �469.060, fdr the issuance and sale by the Port Authority of its bonds in the aggregate principal amount not
28 to exceed $ (the "Bonds") and for the pledge of the full faith, credit and resources of the City
29 to the payment of such Bonds, which Bonds will also be secured by tax increments to be derived from the
30 Williams Hill Tax Increment Financing District and Hazardous Substance Subdistrict therein (collectively
31 refened to herein as the "District"), the establishment of which was approved by the City by its Resolution
32 No. adopted on October 16, 1996; and q `� �3�,
33
34 WHEREAS, in its Resolution No. the Port Authority described the purposes for which the Bonds
35 will be used, to wit: first, to the repayment of a loan previously made by the City from Community
36 Development Block Grant funds (the "CDBG Loan") to the Port Authority, as evidenced by the Port
37 Authority's Tax Increment Revenue Note(Williams Hill Project), Series 1996 (the "Note"), for the purposes
38 of paying or reimbursing the costs and expenses necessarily incurred by the Port Authority for acquisition
39 of the Williams Hill Site, environmental remediation, construction of infrastructure improvements, the
40 relocation of owners, occupants and tenants, and then for all other purposes authorized by authority of
41 Minnesota Statutes, Chapter 469, as amended (the "Act"); and
42
43 WHEREAS, the Council of the City (the "Council"), being duly advised in the premises, finds and
44 determines that it is necessary and appropriate that the Port Authority issue and sell bonds of the Port
45 Authority in the aggregate principal amount not to exceed $� for the purposes set forth in its
46 Resolution No. as stated above; and
47
48 WHEREAS, on the basis of the foregoing, it is now the intention of the Council to grant authority to
49 the Port Authority for the issuance of the Bonds; to prescribe the manner for establishing the amount,
50 maturity schedule, rates of interest, and the maximum rate of interest, to be borne by the Bonds; to authorize
51 the Port Authority to establish the date, denomination, place of payment and other details of the Bonds,
52 including the form of the Bonds; and to authorize and consent to the pledge by the Port Authority of the full
53 faith, credit and resources of the City to the payment of the Bonds as the same shall be issued and sold by
54 the Port Authority, pursuant to the authority of the Act, and pursuant to the authority granted by this
55 Ordinance; and
56
57 WHEREAS, the Loan Agreement provides that the City has completed the first reading of this
58 ordinance authorizing the issuance of the Bonds by the Port Authority, and such Loan Agreement also
59 provides that the City may cause bonds to be issued other than pursuant to this Ordinance in order to repay
60 the CDBG Loan if certain conditions are met:
61
62 NOW, THEREFORE, THE COUNCIL OF THE CITY OF SAINT PAUL DOFS ORDAIN:
63 Section 1
64 Authorization of Bonds. That subject to, and in accordance with, the applicable provisions, terms
65 and conditions of this ordinance and those contained in Section 469.060 of the Act, authority is hereby
66 granted to the Port Authority for the issuance and sale of its Bonds in the aggregate principal amount not to
67 exceed $ and the use of the proceeds of such Bonds first for the repayment of the CDBG Loan,
68 and then for all other purposes authorized by the Act. The tax increments from the District shall be pledged
69 to the payment of the Bonds
70 Section 2
71 Establishing Terms of the Bonds. That the Port Authority is hereby authorized to establish the date,
72 denomination, place of payment, form and details of the Bonds, provided that the Bonds shall be issued and
73 sold by the Port Authority as tax exempt and/or taxable Bonds in one or more series, in the manner provided
74 and allowed by law; the Bonds shall be secured by a pledge of the tax increments to be received by the Port
75 Authority from the District; the initial principal amount of the Bonds shall be equal to an amount sufficient
76 to repay the CDBG Loan in full and to fund a reserve as necessary to allow the tax levy to be canceled as
77 provided in Section 4 below (but shall not exceed an amount equal to $ ); the Bonds shall mature
78 in the amounts and years and bear interest at the rate or rates per annum established by the offer to purchase
79 the Bonds which is determined to be the most favorable by a Pricing Committee comprised of one
80 representative each from the Port Authority, the City's Budget office [and Springsted Incorporated or such
81 other fiscal consultant as may have been retained by the Port Authority in connection with the issuance of ;
82 the Bonds] provided that the average annual weighted interest rate of the Bonds shall not exceed
83 percent �%) per annum payable semi-annually unless such higher average annual weighted interest
q �... 13� �
84 is specifically approved by a resolution adopted by a majority of the members of the Council; and the
85 proceeds from the issuance and sale of the Bonds as received by said Port Authority shall be used first to
86 repay the CDBG Loan, and then for all other purposes authorized by the Act. The Bonds may be made
87 subject to redemption and prepayment at the option of the Port Authority at such time and price or prices
88 as shall be determined by the Port Authority and approved by the Pricing Committee described above and
89 upon such notice as is required by law. It is recognized that Section 469.060 of the Act provides that the
90 Bonds must be in the amount and form and bear interest at the rate set by the Council, that the Port
91 Authority with the consent of the Council shall set the date, denominations, place of payment, form, and
92 details of the Bonds and that the Council is required to decide whether the issuance of the Bonds by the Port
93 Authority is proper and if so, the amount of Bonds to issue, and that the Council is required to give specific
94 consent in the Ordinance to the pledge of the City's full faith, credit and resources to the Bonds. The
95 standards and delegation to the Pricing Committee set forth herein are intended as such full required action
96 of the Council, and except as provided herein no further approval of the Council is required for the issuance
97 of the Bonds under Section 469.060 of the Act.
98 Section 3
99 Pledge of Full Faith and Credit. That as security for the prompt and faithful payment of both
100 principal and interest of said Bonds the Port Authority is hereby authorized to pledge the full faith, credit
101 and resources of the City of Saint Paul, and such Bonds, both in respect of the principal amount of the same
102 and with respect to the interest thereon, may be paid by the Port Authority from tax levies provided therefor
103 and authorized by the Act.
104 Section 4
105 Tax LevX. That the Port Authority, in the event of the issuance of any said Bonds authorized
106 hereunder, shall before the issuance of the same, levy for each year, until the principal and interest are paid
107 in full, a direct annual tax on all the taxable property in said City of Saint Paul, in an amount not less than
108 5% in excess of the sum required to pay the principal and interest of the same when and as such principal
109 and interest mature and, after such Bonds have been delivered to the purchasers, such tax shall be
110 irrepealable until all such indebtedness is paid, and after the issuance of such Bonds no further action by said
111 Port Authority shall be necessary to authorize the extensions, assessments and collection of such tax. That
112 the Secretary of said Port Authority shall forthwith furnish a certified copy of such levy to the County
113 Auditor of Ramsey County, Minnesota, the county in which said Port Authority and said City are located,
114 together with full information regarding the Bonds of said Port Authority for which the tax is levied and such
115 County Auditor shall extend and assess the tax so levied, and shall do so annually until the principal and
116 interest have been paid in full. That any surplus resulting from the excess levy therein provided shall be
117 transfened to a sinking fund after the principal and interest for which the tax was levied and collected has
118 been paid; provided, that said Port Authority may, on or before September 15 in any year, by appropriate
119 action cause its Secretary to certify to the said County Auditor the amount on hand and available in its own
120 treasury from tax increments derived from the Williams Hill Tax Increment Financing District, earnings or
121 other income, including any amounts in the sinking fund, which it will use to pay the principal and interest
122 or both on each specified issue of its Bonds and the County Auditor shall reduce the levy for that year herein
123 provided for by that amount. That the amount of funds so acquired shall be set aside by said Port Authority
124 and be used for no other purpose than for the repayment of the principal and interest on such Bonds. That
125 all taxes being authorized to be levied under Minnesota Statutes, Section 469.060, as amended, shall be
126 collected and remitted to the Port Authority by the County Treasurer in accordance with provisions of law
127 governing the collection of other taxes and shall be used solely for the payment of such Bonds when due.
128 Section 5
129 No Further Council Action. That said Port Authority may provide for the exercise of the authority
130 hereby granted for its issuance and sale of the Bonds in the aggregate paz value amount provided in Secdon
1312 hereof, for the aforesaid purposes, and the pledge of the full faith, credit and resources of said City of
132 Saint Paul, as security for the payment of the same, by its appropriate resolution, and without further action
133 of the Council. The authority to set the maturity amounts and interest rates on the Bonds has been delegated
134 to the Pricing Committee as provided in Section 2 hereof. That in exercising the foregoing authority, the
135 Port Authority shall make due compliance with all applicable requirements for this ordinance, said Section
qc.-�� 41
136 469.060, Minnesota Statues, as amended, Sections 469.174 through 469.179, as amended, Chapter 475,
137 Minnesota Statutes, as amended, and all other applicable laws.
138 Section 6
139 Authorization of Refunding Bonds. Pursuant to and in accordance with the provisions, terms and
140 conditions of this Ordinance and the Act, authority is hereby granted to the Port Authority to issue and
141 sell Bonds as authorized by Minnesota Statutes, Section 469.060, in aggregate principal amounts
142 necessary for the purpose of securing funds as needed by the Port Authority to refund obligations issued
143 under this Ordinance. The principal of the refunding bonds may exceed the principal of the bonds to be
144 refunded to the extent necessary and appropriate to pay interest thereon (including interest accruing as
145 capital appreciation), to pay costs of issuing the refunding bonds and to allow for discount upon sale, and
146 to fund reserves and capitalized interest for the refunding bonds.
147 Section 7
148 Effective Date; Nullification. That this ordinance shall take effect and be in force 30 days after the
149 passage, approval and publicadon; provided, however, that this ordinance shall be null and void and of no
150 further force and effect in the event the City provides the Port Authority with a written certification from
151 an expert satisfactory to the Port Authority stating that the Bonds if issued as provided herein would bear
152 interest at a rate which is at least 100 basis points higher than bonds issued by the City with identical security
153 and the City exercises its right to cause bonds to be issued other than pursuant to this Ordinance in order to
154 repay the CDBG Loan pursuant to Section 3.1(2) of the Loan Agreement.
155
pndi i�ucn
DEC 141996
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Adopted by Council: Date Form App ed by Ci A orney
Adoption Certified by Council Secretary � _
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A roved b Ma r: Date Approved by Mayor for Submission to
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��TOTAL#E OF 81�I�ATURE P�E8 ' � �� ��� (CLIP�ALL��IOCATIONS FOii W�iNATtlR� g��� '� , �� �;�,'s�'�`�°�. �� �
AR:TION I�CUE8TE0: `� +a::
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1. Authorizatian ezecute a CDBG Float Loan foi the T�Itlliaas Hill psoject in an a�o�mt� i;
not to eaceed #���lion.
2. First r in.g of an Ordinance grantiag the Port Authority the abili.tg to issue baads 'ftfr:
:M�Ul a�lR) ; PERSONAI,,SERVICE CONYR�C7'S IIIU$T AN=1NER 17tE f0�L1.OMfIN3 OUEn10l1�:
_W.AtaN1N0 c�AISB�ON _cavlL SEnvtCE ooMMi88ion t. Has this persordNrm wer work�d urbsr a conhaat for tl�s d�prhnent4 -
YES 'NO
_Cls OOMMITTEE — 2. Hes ihis per�n/firtn evar bNn 1t dht empl0yes,?
—8T�` — YES NO
_aatt�cr c�uRT � 3. ooss dNs p�a�nn voesa•s a�Icu�nr�normaNy ac.sas.d ey.M+oum�nt dtr«rw�ay«7
BUPPORTB WMICN COtRif�L OBJECf1VE4 YES NO `�
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- �xplain dl yes an�w�n on s�p�ett�shNt and att�eb to�n�n�t < `
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M�pTtATNq PROBI.Bd�I�BUE�OPPORf1iN1TY lWhe.Wh�t.wh�n�WMn.WhYY
l. 0n Septesber 18, 1996 the Council suthorized: PSD to aa�end the 19'�6 CDBG spetn�dia,g:p �� ':.
��;�,nclude a Float Loan�not to azceed $6 Millioa. Council authorizaCioa for ezecutia�i,_��. 4
�'�Aie �oan is now being requested. :� :
_ � t: � ; �
` �. The Float I.osa is to be repaid �i�+�h t'�er��aG.^�9mrtz�.:_-_• $onda v'il.l=be issu,ad by
� Port ta repay: the Floa.t Loan. � �
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1. ,•�T6e Float Loan will provide interest free, inter�a f3ria,inci�ig at a'cost sarii.ngs j o�,:
�2 Million.
2.. .In the case that there are legislative changes to TIF lav, ire will incraase the
.. :s._ :, ;
possibflity of being graad�athered, if the 'C9.ty' hae alieadj'inc�rred/co�iiitted :to . _� .
s debt obligation through approval of a bond ordinaace.
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1. The Float Loan does enrail soae level of rist. �" �
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0�8ApVAliT11QE81F qCr APPRGVED:
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The i�Tilliaas Hill project �l.11 not be itiplesented. Loss of potegtia1 ,325 jobs aad incs °� }
taz base.
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ro�r��oF ��1 = 2• #��•� �" cosTrt�v�we s�wa�seo(cinc�.�o�� res rw `,
1TRA{I�BG� _OS�F'7 f��..
fw�ai souRCE 2, Gi0 Baad Pledge/Port Issuance : �c�nvtrr NuMSea I�o- 37 O .
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DEPARTMEKf OF PLANIVING
&ECONOMIC DEVELOPMEIVl'
Panela Whedo%Director q � �. ,3 y,
Cl'TY OF SAINT PAUL 25 Wat Fourth Sd�eet Telephone:612-266fi655
Norm Coleman,Mayor Saint Paul,MN 55102 Facsimile:612-228 3261
�
To: Councilmember Jerry Blakey
Councilmember David Thune
Councilmember Micheal Harris
Councilmember Roberta Megard
Councilmember Janice Rettman
Councilmember Dan Bostrom
Councilmember Dino Guerin
From: Marie Franchett, PED
Lorrie Louder, Port Authority
Date: October 23, 1996
Re: 1. Authorization to Execute CDBG Float Loan for Williams Hill
2. First Reading of Bond Ordinance for Williams Hill
On September 18, 1996, the City Council authorized an amendment to the 1996 CDBG
spending plan and authorized staff to enter into a grant agreement and contract with HUD
regarding a CDBG float loan for the project. The attached resolution will authorize PED to
enter into a loan agreeement with the Port Authority.
The attached Ordinance will grant the Port Authority the ability to issue the GO backed bonds
to repay the float loan. There will be a total of four Council readings of the proposed bond
ordinance, with a final reading date of November 6, 1996.
Staff recommends that the City Council approve the attached resolution authorizing execution of
the CDBG float loan agreement for the Williams Hill Project, and staff requests that the
Council conduct a first reading of the attached ordinance.
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