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270044 Y WHITE - C�TV CLERK CQU�1C11 +'� PINK - FINANCE GITY OF SAINT PAUL � �J� �.�� � CANARV - DEPARTMENT � BLUE - MAVOR File NO. Council Resolution Presented By ���—�-zC�� ���� Referred To Committee: Date Out of Committee By Date WHEREAS: 1 . On October 18, 1977, the Port Authority of the City of Saint Paul adopted Resolution No. �259, giving preliminary approval to the issuance of revenue bonds in the initial principal amount of approximately $435,000 to finance the addition to the Baldinger Baking Company facility. 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 initial principal amount of said bonds will be approximately $435,000.00 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. 1259 in the initial principal amount of approximately $435,000.00 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 � (n Favor Hozza Hunt Levine � Against BY Roedler Sylves SCO NOV 3 1977 Form Approved by y tto ey Ad ed by Council• Date ertified Ya by C cil Secre�ary BY By, � App d by INayor: t � Approv by Ma r for S mi to Cou cil Q�_ By BY FiJSLlSNED i;�u'�1 1 � 1977 , • ; : . OM Ol: I2/I975 Rev. : 9/8/76 E�fPLANATION OF ADMINISTRATIVE ORDERS, RESOLUTIONS, AND ORDINANCES ������' �� �`, . �. Date: Octaber 24, �1977 . � TO• MAYOR GEORGE LATIMER FR: E. A. Kraut,� St. Paul Port Authority REs BALDINGER BAKING COMPANY, INC. : - LAND LEASE PRELIMINARY AND UNDERWRITING AGREEMENTS ACTION REQUESTED: In 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 $435,000 in revenue bonds for the purpose � of constructing an additional 10,585 square feet of production space along the west and south sides of their present plant in Riverview Industrial Park. r PURPOSE AND RATIONALE FOR THIS ACTION: The purpose of the bond issue is to finance the construction of a 10,585 square foot addition of production space along the west and south sides of their present piant. This will permit the company to acquire additional equipment at their expense, increase production and employment, and eliminate present overcrowded conditions. ATTACHMENTS: � Staff Memorandum Draft City Council Resolution Port Authority Resolution No. 1259 Preliminary Agreement . . P�� R T C � "� AU �` H � RITY �'�����-� OF THE CITY OF ST. P/1UL Men�o�ondum TO: BOARD OF COP�MISSIONERS � DATE: Oct. 13, i977 (Oct. 18, 1977 egular Meeting) FltOM: D.G. Dunshee SUSJECT: BALDINGER BAKING COMPANY, INC. LAND LEASE, PRELIMINARY AND UNDERWRITING AGREEMENTS 1. THE COMPANY: Baldinger Baking Company has been a tenant of the Port Authority in Riverview Industrial Park since 1969. They are a general purpose bakery specilizing in commercial accounts for restaurants , supermarkets, and fast food chains. At the time of the original industrial revenue bond issue in 1968, Baldinger had annual sales of $920,000 and employed 65 people. As of November 30, 1976, annual sales had increased to $3,447,311 , and employment increased to approx- imately 85 people, 2. THE PROJECT: In 1969, the first revenue bond issue was for $450,000 to construct a 16,500 square foot facility. In 1975, the Port Authority approved the issuance of $240,000 in revenue bonds to add an additional 5,551 square feet to the plant. The proposed addition would add an additional 10,585 square feet of production space along the west and south sides of the plant. This will permit the company to acquire additional equipment a� their expense, increase production and employment, and eliminate present overcroNrded conditions. It is estimated that the construction of the building will take six months. 3. UNDERWRITING AGREEMENT: The projected costs for the addition are as follows: Construction & Architect's Fees � $350,000.00 Bond Issue Expense 20,232.50 Capitalized Interest - 6 Months 16,202.50 pebt Service Reserve 35,515.00 Under�vri ter's Di scount 13,050.00 TOTAL $435,000.00 � • � \ ' BOARD OF COP�if�ISSIONERS Oct. 13, 1977 Page -2- Briggs & Morgan recommend�d ta the Port Authority in a letter dafied August 19 that in order to avoid merg�r of tw� bond issues approved . on the same day that the resolution approving this project auth�rize the President and Secretary of the Port Au*hority CommissiQn to - execute the underw�riting agreement prior to the next regular meeting of the Commission. Execution of tn° underalrifing agreem�nt for Ba1dinger Baking would be ratified at the November m�eting 6y the adoption of a formal supplemental bond resolution. 4. 7ERMS OF TNE LEASE: In addition to proposing an additional industrial revenue bond issue, Baldinger Baking Comp�ny also wishes t� lease an additior�al trae� of land adjacent to th�ir present facility. The site' contains 32,210 square feet and would complete the sale of all property on the w�st sZde of Eva Street between Plato Soulevard and new Florida Court. b!e propose a 1 and 1 ease at a rate of $1 .5� per square foot pl us 7;J interes� over a 30-year term wi±h annual rent being $4,052.76 payable ironthly in advance in t^�e amount of $337.73. �he t°rm of the 1 ease wnul d be from ��overnb�r 1 , 1977 ta Oetot�er 31 , 2007 wi th the fi rst mo���h' s rent paym�nt due P�ay 1 , i 978. There v�ioul c� be opti�n to purchase provi s�o=�s i n the 1�nd 1 ease i n the fo11 o�ri ng amounts: 10 Years 2Q Years 30 Years $38,722.86 $27,653.93 $24,907.50 In addition to the o�tior� ta purchase the land, there wau�d be � provision in the b�nd issue tp approve purchas� or �he n�w �dditioi� at the end of the lOth, 20th, and 30th yea�s as follows: 10�31-1987 1 Q�31-1997 1 d-31=2007 $43,500 * $�3,500 * $43,5Q0 * Plus retirement of outstanding bands. Income to the Port f�uthority from th2 project will be as fol7ows: Lan� Rent & Options $133,014.95 Debt Ser�vice Reserve - $35,515 - 6°�0 - Term 63,927.00 Option to Purchase 43,500.4Q Intares� Earnings on Sinking Fund($655 per year� 1�,6�Q.OQ TOTAL $260,09� .95 � Estimated Real Estate Tax.es - $15,125 X 3fl Years 453,750.00 'fotal Pnr� Authority Inco�e and Rea1 Estate Taxes Estimated - Term $713,841.95 l r ` - ' � � " � BOARD OF COh1rtISSIONERS Qct. 13, 1977 Page -3- 5. RECO1��cr�NnATIONs Staff has reviewpd th� financial statement of Baldinger Baking Comoany, in�ervie4ti�e� ofificers of the company and inspected the _ existing facility. 41e recomm�nd approval of the 1an� lease . and financing for the expansion. We also recommend approval of Resolution �la. 1259 which wnuld apprave the land leas�, preiiminary agre�m�nt and authorize the President and Secretary - to execu�e the u�der��rf ti ng agreem�nt prior to the n�xt .regul ar meeting of the Commission to avoid the merger issue. DGD:ca . . ,.., . .�--�i� � ��'��2�,,r`�,� ��- . . Resolution No. �.259 RESOLUTION OF � THE PORT AUTHORTTY OF THE CTTY OF SAINT PAUL � WHEREAS, the Port Authority of the City of Saint Paul (the "Port Authority") , pursuant to Minnesota Statutes, Section 458.196 , did place a notice, a copy of which with proof of publication is on file in the office of the Port Authority, of a public hearing on the proposed sale of property owned or to be oti�ned by said Port Authority in a legal newspaper, sande�estsnofttheedistrict ande henpeoplehand it is in the best i in furtherance of the general plan of port development and industrial development to sell the property described in Exhibit A attachedbeeyncluded therewithnaand��perty o� the Port Authority to �� WHEREAS, the Port Authority of the City of Saint Paul did conduct a public hearing pursuant to said notice on October 1, 1977, at which hearing all taxpayers in the � district, both for and against the sale, were allowed to state their v�ews; and WHEREAS , Baldi.nger Baking Company, a Minnesota corporation (the "Company") , has submitted a proposal to lease with option to purchase said property, which property is owned or will be owned by the Port Authority of the City of Saint Paul; and . WHEREAS, it is in the best interests of the Port District and the people thereof, and in furtherance of the general plan of industrial and port development, to lease said property as described; and WHEREAS , the Port Authority of the City o£ Saint Paul has investigated the facts of tYie proposed lease of said property, said investigation including the. terms and conditions of said lease, the proposed use of said property, and the relationship thereof to the City of Saint Paul and the business facilities of the Port Authority of the City of Saint Paul in ; general; and (� � � ' � . �`���'�, � i. - �� resented by the Company �� y�iEREAS , �e PrOposal p .�e port Authority I conditions set �orth bdetermining if such meets t�e .terms and uide in o� 5aint Paul as �its 5 the Port District of the City .�e best interests of proposals are in and of the public, the Port Authority " THEREFORE, BE IT �SOLVED bY NOW, o� the City of Saint Paul: �e Yort . - the Board oi Commissioners °� determines � 1. That �inds . � _ . o� Saint Paul hereby e port Authority of �e Cit�is for the best interests of � declares �at and in furtherance of the and .�e people thereof, ment, to enter into said District. and develop the CompanY• uPon general plan of industrial urchase with lease with said option t� L' completion of the details thereof. . n$ o� the Executive V1ri�ausi 9eP�1ic 2. The O ft�e City of Saint Paul the terms and orit and in describing .�e port Auth ro osed sale, from and otice of the P p ale, which have been ortlAuthoritY inspe '" n of such s o� the P conditio�e publ�.� at �e ogfice are in all tion bY ot notice of the hearing, after the Publication con�i�ed. respects ratified and �- ' `Eyi� /.� �% 7 i �; � Adopted ` �i /�, � � , 2t.�.� '1 . • . . \ �- 1 p�Ces ident p,ttest / � /' �y� ' �� Secretary . . . . �. , . �►����,� � . , . - � � PRELIN.INARY AGREEMENT - THIS AGREEMENT, made and entered into as of this � �;�" day of C��?�ei._� � , 197�, 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 Baldinger Baking Company, a . corporation organized under the laws of Minnesota, here?natter called "Company" ; WITNESSETH: WHEREAS: A. The Company currently leases facilities from the Port Authority in the Riverview Industrial Park. B. The Campany and Port Authority intend that additional land adjacent to the � � existing leased premises be leased by the Port Authority to the Company and that additional facilities ("Additional Facilities" �be on the combined premises described in Exhibit A attacheu. hereto and incorporated herein b.y reference, . , . ����`�r�� said� existing and additional facilities � and premises being hereinafter called . "Project"; � � C.� The parties hereto intend, subject to the __ - - . _ . _ � - terms, covenants and conditions herei� � contained, to either 'amend the existing � lease or enter into a new lease af the . Project, which lease wo�xld include the . covenants set forth in the Project Agreement (said amendment to lease and Project Agreement or new leas� hereinafter called "Revenue Agreement") in the form � and tenor. customary with respect to industrial revenue bond financing in the State of Minnesota and to finance the acquisition, installation and construction of the Project through the issuance by the Part Authority of Industrial Develogment � Revenue Bonds (hereinafter called Bonds) . pursuant to Minnesota Statutes, Chapters 458 and 474. . NOW THEREFORE, in consideration of the mutual covenants herein contained, it is hereby agreed by and between the parties hereto as �ollows : , / ; ��,��,�� � 1_ The Company. and the Port Authority agree to nega- � 'ate the Revenue Agreemen� in a form and tenor customary with � ts. 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 o� the Bonds and shall extend � through the final maturity date of 'the Bonds. � (b) The Company shall agree under the Revenue Agreement to make additional monthly payments in the amounts and at such times as are set out in said negotiated Revenue Agreement, but in any event suffi- . cient to pay when due debt service vn the Bonds. (c} znterest on earnings derived from the investment o� the monthly payments and o�ther monies in the Bond Fund and any Reserve sha11 inure to the benefit of the Port Authority. (d) The Company shall have the option to purchase the Project at the amounts set forth in the existing � lease plus (1) an amount required to discharge the Bonds, including payment of Paying Agent and Escrow Agent fees and any other liabilities accrued under � the Revenue Agreement and (2) such additional amount determined in the Revenue Agreement to be required to reimburse the Port Authority for its additional equity in the Project. , - - � ��,�� �� _ � (e) The Company shall be entitled to credit • against its last installments of payments due during . the term of the Revenue Agreeinent the principal. - amount of any surplus construction funds transferrEd � � to the Bond Fund and any Reserve established out of bond proceeds. • (f) The Company shall agree to cause the Pro-- ject to be maintained in good working order and free of liens to the extent provided in the Revenue Agree- ment. . (g) The Company shall agree to procure on or before termination of the construction period and maintain in its name and in the name of the Port Authority, liability and praperty insurance F�ith respect to the Project in amounts and against risks customary with respect to such properties. (hJ The Company agrees that prior to the commeneement of the construction 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 Pro- ject 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 �iled . , . ��,�2,� ,�,� t,oith the Port Authority and approved by its duly � designated agent, (i) all payment and performance ' bonds for the work to be undertaken, (ii) all. con- � struction contracts , including any installation . contract, (iii) such builders risk, installation floater, and liability insurance as will fully protect the Company, contractor and Port Authority (who shall be named as an. additional insured) as their interests shall appear, against risk of lass or damage to the Project and Project premises and against claims which may arise from the construction, acquisition and installation of the Project, and (iv) waivers from the general contractor and all subcon- tractors and suppliers of all rights against the Port Authority for damages to property except such rights as they may have to proceeds of such insurance. A].l construction contracts entered into for construc-- ting the 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. � (i) The Company shall agree to pay a11 taxes, assessments, and other governmental charges that are or may become due with respect to the Project. � , , . • ��i�-��„�4 i� ,� � 2. Prior to the commencement of construction of the Project, the Port Authority and the Company shall complete and enter into a Project Agreement in substanti.ally the form on file in the office o� the Port Authority or into the negotiated Revenue Agreement which, if a new lease, may substantially _ . .: . � ineorporate by reference Arti,cles l and 2 of such Project - Agreement. � 3. Upon negotiat3.on of the details of said Revenue Agreement and final determ'ination of the terms of the Bonds, the Port Authority shall thereafter issue said Bonds in accor-- dance witY� the terms and conditions set forth in an underwriting agreement and the Revenue Agreement; provided that: (a) Details of the sale and issuance of the Bonds to be issued by the Port Authority shaI.l be - subject to final approval by the Company and the Port Authority. � � (b) Issuance of said Bonds shall be subject ta the issuance of the approving opinion of Briggs and Morgan, Professional Associationr Bond Counsel for the Port Authority and for the City of Saint Paul, and � � the furnishing of a11 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 comply with all state and federal laws, regulations, rulings and decisions. , . ' . . . r . -�y���J�,'� '� s,s�� ,a-�. '7 4. Regardless of whether or not for any reason the Bonds are issued, the Company shall upon demand nevertheless promptly pay or reimburse the Port Authority for the payment of ; all out-of-pocket expenses incurred by the Port Authority in i _ • connection with the Project including without limitation all Bond Counsel and other legal fees i.ncurred in the preparation of this Preliminary Agreement, the neqotiated Revenue Agreement, the underwriting agreement, and other related •documents. � _ 5. �his Agreement is subject to the approval of the City Council of the City of Saint Paul as provided by Chapter 234 of the Laws of Minnesota for 1976 . . IN WITNESS WHEREOF, the parties hereto have caused these presents to be executed as of the day and year first above written. In t Presence of: PC1RT AUTHORITY OF THE CITY OF SAT�7T �AUL � , . � �r� � ,Gc_,._ By , Lf C , � 'w f � I tS /iLL���'��L- � � � ` . � � ���� � �C ���� �;/ . i " $y . ;.�--- , ./ , � . ,�-�����-_�.�_. (Corporate Seal) . �� , , ; , � . , ' � � . . . ����;;� � . ._ � In the Presence of: - By � I ts By . Its (Corporate Seal) . .