03-10743�
Council File # �" �V i`�
Resolution #
Presented By
Referred To
Committee: Date
RESOLUTION RECITING A PROPOSAL FOR A
FINANCING PROGRAM FOR A MIJLTI-FAMILY RENTAL
HOUSING DEVELOPMENT, GIVING PRELTMINARY
APPROVAL TO THE PROJECT AND THE PROGRAM
PURSUANT TO MINNESOTA STATUTES, CFIAPTER 462C,
AUTHORIZING THE HOUSING AND REDEVELOPMENT
AUTHORITY TO ISSUE HOUSING REVENUE BONDS
t1ND AUTHORIZING THE PREPARATION OF NECESSARY
DOCUMENTS AND MATERIALS IN CONNECTION
WITH THE SAID PROJECT AND PROGRAM
1 (LYONS COURT PROJECT)
2 (a) Minnesota Statutes, Chapter 462C (the "Act) confers upon cities, or housing and
3 redevelopment authorities ar port authorities authorized by ordinance to exercise on behalf of a
4 city the powers conferred by the Act, the power to issue revenue bonds to finance a program for
5 the purposes of planning, administering, making or purchasing loans with respect to one or more
6 multi-family housing pro�ect developments within the boundanes of the city;
7 (b) The Housing and Redevelopment Authority of the City of Saint Pau1, Minnesota
& (the "HRA") has been designated, by ordinance, to exercise, on behalf of the City of Saint Paul,
9 Minnesota (the "City") the powers conferred by Minnesota Statutes, Section 462C.01 to
l0 462C.081;
11 (c) The Housing and Redevelopment Authority of the City of Saint Paul, Minnesota
12 (the "HRA"), has received a proposal from Lyon's Court Limited Partnership, a limited
13 partnership organized under the laws of Minnesota (the "Partnership"), that the HRA undertake a
14 program (the "Housing Program") to finance a Project hereinafter described, through the issuance
I S of revenue bonds (the "Bonds") pursuant to the Act;
16 (d) The Project to be financed by the Bonds is the acquisition, conshuction and
17 equipping of a senior independent living housing facility containing approximately 60 rental units
18 located at 230 East Tenth Street in the City of Saint Paul (the "Project");
19 (e) The proposal ca11s for the HRA to loan the proceeds realized upon the sale of the
20 Bonds to the Partnership pursuant to a revenue agreement ar agreements wherein the Partnership
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21 will be obligated to make payments at the times and in amounts sufficient to provide for the
22 prompt payment of principal of, premium, if any, and interest on the Bonds and all costs and
23 eapenses of the HRA and the City incident to the issuance and sale of the Bonds;
24 ( fl The City desires to facilitate the acquisition and construction of a multifamily
25 housing facility within the City; and the Project will assist the City in achieving these objectives;
26 (g) A public hearing on the Housing Program and the Project was held on this date
27 following duly published notice, at which time all persons that desired to speak were heazd;
28 (h) No public official of the City has either a direct or indirect financial interest in the
29 Project nor will any public o�cial either directly or indirectly benefit fmancially from the Project;
�o and
31 (i) A form o£Memorandum ofUnderstanding has been prepared between the HRA
32 and the Partnership, which sets forth certain understandings by and between the HRA and the
33 Partnership pertaining to the Project, and the fmancing therefor.
34 NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Saint
35 Paul, Minnesota, as follows:
36 1. The City hereby gives prelnninary approval to the proposal of the
37 Partnership that the City undertake the Project; described above, and the program of financing
38 therefor, pursuant to Minnesota Statutes, Chapter 462C, consisting of the acquisition,
39 construction and equipping of a senior independent living facil3ty within the City pursuant to the
40 Partnership's specifications and to a revenue agreement between the �1RA and the Partnership on
41 such terms and conditions with provisions for revision from time to time as necessary so as to
42 produce income and revenues sufficient to pay, when due, the principal and interest on the Bonds
43 in the total principal amount of approximately $5,000,000 to be issued pursuant to the Act to
a4 finance the acquisition and construction of the Project; and said agreement may also provide for
45 the enfire interest of the Partnership therein to be mortgaged to the purchasers of the Bonds, or a
46 trustee for the holdex(s) of the Bonds; and the City, acting by and through the HRA hereby
47 undertakes preliminarily to issue its revenue bonds in accordance with such terms and conditions;
4s 2. On the basis of information available to the City it appears, and the City
49 hereby finds, that the Project constitutes a multi-family housing development within the meaning
50 of subdivision 5 of Section 462C.02 of the Act; that the availability of the financing under the Act
51 and the wiilingness of the City to furnish such financing will be a substantial inducement to the
52 Partnership to undertake the Project, and that the effect of the Project, if undertaken, will be to
53 encourage the provision of multi-family rental housing opportunities to residents of the City, and
54 to promote more intensive development and use of land within the City;
55 3. The Project, and the program to finance the Project by the issuance of the
56 Bonds, is hereby given preliminary approval by the City subject to final approval by the HRA, the
57 Partnership and the purchasers of the Bonds as to ultimate details of the financing of the Project,
58 4. Parsuant to Chapter 72, Saint Paul, Minnesota Administrative Code, the
59 City hereby authorizes and directs the Housing and Redevelopment Authority of the City of Saint
6o Paul, Minnesota (the "HRA") to issue the Bonds to finance the Project and to take ali actions
61 necessary or desirable in connection therewith, and no further approval or authorization of the
62 City shall be required; provided that the HRA may, in its discretion, authorize the Board to issue
6� the Bonds and to implement the program approved hereby, and the City hereby consents thereto;
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64 5. The Partnership has agreed and it is hereby detenniued that any and all
65 costs incurred by the City or the HRA in connecrion with the fmancing of the Project whether or
66 not the Project is carried to completion and whether or not approved by HRA will be paid by the
67 Partnership:
68 6. Briggs and Morgan, Professional Association, acting as bond counsel, and
69 such investment bankers as may be selected by Partnership, with the consent of the IIRA, are
70 authorized to assist in the preparation and review of necessary documents relating to the Project
71 and the financing program therefor, to consult with the City Attorney, Partnership and the
72 purchaser of the Bonds as to the maturities, interest rates and other terms and provisions of the
73 Bonds and as to the covenants and other provisions of the necessary docuxnents and submit such
74 documents to the HRA for final approval;
75 7. Nothing in this Resolution or the documents prepazed pursuant hereto shall
76 authorize the expenditure of any municipal funds on the Project other than the revenues derived
77 from the Project or otherwise granted to the City or the HRA. The Bonds shall not constitute a
78 charge, lien or encumbrance, legal or equitable, upon any property or funds of the City or the
79 III2A except the revenue and proceeds pledged to the payment thereof, nor shall the City or the
8o HRA be subject to any liability thereon. The holders of the Bonds shall never have the right to
81 compel any exercise of the taxing power of the City or HRA to pay the outstanding principal on
82 the Bonds or the interest thereon, or to enforce payment thereon against any property of the City
s3 or the HRA. The Bonds sha11 recite in substance that Bonds, including the interest thereon, are
84 payable solely from the revenue and proceeds pledged to the payment thereof. The Bonds sha11
85 not constitute a debt of the City or IIRA within the meaning of any constitutional or statutory
86 limitation.
8� 8. In anticipation of the issuance of the Bonds to finance all or a portion of the
ss Project, and in order that completion of the Project will not be unduly delayed when approved, the
s9 Partnership is hereby authorized to make such expenditures and advances toward payment of that
90 portion of the costs of the Project to be financed from the proceeds of the Bonds, as the
91 Partnership considers necessary, including the use of interim, short-term financing, subject to
92 reimbursement from the proceeds of the Bonds if any when delivered but otherwise without
93 liability on the part of the City or the ARA.
9a 9. The form of the Memorandum of Understanding is hereby approved and
95 the Executive Director of the HRA is hereby authorized to execute the same.
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96 Adopted by the City Council of the City of Saint Paul, Minnesota this 3rd day of
97 December, 2003.
Requested by Department of:
Adoption Certified by Council Secretary
i
Approved by
:
ry
I�
Plauuin & Ec nomic Develo ment
By:
Approved by Financial Services
I:
Fnrm ArnrOV
1580922v1
Adopted by Council: Date �o/°...�, �D/l.- i
f�'L� X`hs�
DEPARTMENT/OFFICE/COONCII.: DATE INITTATED V ` F �
PED November 17 GREEN SHEET No.: . y �
2��3 � r/le? 7 9 �
' CONTAGT PERSON & PHONE: IlNITTAL/11A1'S ]NiT1AIJDnTE
Allen Cazison, 266-6616 � z nEr��rn�NT n� 6_covxcu,�sEnxc�
M[JST BE OY COUNCII, AGENDA BY (DATE) �IGN _
vpMggg 3 CITYATTORNEY Kelly _COUNCII.
December 3, 2003 - Public Fox
Hearing ROUI'ING 4 FINANCIAI, SERV DIIL _}1NANCIAL SERV/ACCTG
ORDER
5 MAYOR (OR ASST.) I TEAM LEADEA
TOTAL # OF SIGNATURE PAGES 1_(CLIP ALL LOCATIONS FOR SIGNAI'URE)
ACTION REQUESTED: Sign the attached resolution authorizing preliminary approval to issue multifanuly
revenue bonds of appro�mately $4.4 million to construct the proposed Lyon's Court senior rental housing
development located at 530 Sibley Street in the North Quadrant Redevelopment Project Area.
RECOMMENDATIONS: Approve (A) or PERSONAL SERVICE CONTRACTS MiJST ANSWER
Reject �) THE FOLLOWING QUESTIONS:
"' 1. Has this person/firm ever worked under a contract for this
y�= PLANNING COMIvIISSION department?
��� CIB COMNIITTEE Yes No
�" CIVIL SERVICE CONIIvIISSION 2. Has this person/firm ever been a city employee?
�':
� City Councii Yes No
�a�
?�r HIZA 3. Does this person/firm possess a skill not normally possessed
� �, by any current city employee? Yes No
; Expiain all yes answers on separate sheet and attach to green
�;�:
sheet
� IPiITIATING PROBLEM, ISSUE, OPPORTITNITY (Who, What, When, Where, Why):Sherman Associates,
vei er is ro osin to construct 60 units of senior rental housin at 530 Sible Street on's Court in
�, Ina (De op ) p P g g Y �Y )
conjunction with the conversion of the Workforce Building 215 9�' Street into 50 units of for sale-lofts (9"' Street
- Lofts). Tota1 development cost of Lyon's Court is $8,595,000. Staff is proposing the issuance of approxunately
„ $4.4 million in tax exempt multifamily revenue bonds, which proceeds will be used to construct the project. The
bonds will be backed by a first mortgage insured by HUD. The balance of the project will be financed with low
income housing tas credits ($2.2 Ivn, federal HOME funds ($150 K), TaY increment financing bond issued against
the 9�` Street Lofts project ($ lIvn and the rest from Developer contributions.
nnvnrrrncES iF arrxovEV:The addition oF 60 senior rental housing units to the City's housing stock of which 30 units
: will be affordable to households at or below 50% of the area median income. This project constitutes phase III of
the North Quadrant Redevelopment Plan.
DLSADVANTAGES IF APPROVED:
nrsanvnrrrncES � xor nrraovEn: The loss of constructing 110 units of housing (50 for 9�' Street and 60 for Lyon's
Court) One project can't be built without the other because of the pazking ramp being built on the Lyon' Couit site
for residents of the 9�' Street Lofts project.
A�.
.�_ -,✓ ,r . �.e� 1 6V�
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03-�0�
MULTI-FAMII.Y RENTAL HOUSING PROGRAM OF THE
CITY OF SAINT PAUL, MINNESOTA, AND THE
HOUSING AND REDEVELOPMENT AUTHORITY OF
'I`FIE CITY OF SAINT PAUL, NffNNESOTA
December 3, 2003
Proposal; Authoritv. The Housing and Redevelopment Authority of the City of Saint
Paul, Minnesota (the "HRA"), proposes to issue revenue bonds and to take other actions in
fi�rtherance of the objective of financing the acquisifion, construcfion, and equipping of the
multi-family rental housing project described herein (this "Program") pursuant to appiicable
authority conferred upon the HRA by the laws of the State of Minnesota, including without
lunitation Minnesota Statutes, Chapter 462C, as the same may be amended from time to time
(collectively, the "Act").
P oses. In creating this Program, the City of Saint Paul, Minnesota (the "City"), and
HRA aze acfing in fiu•therance of their findings that the preservation of the quality of life in the
City is in part dependent upon the maintenance and provision of adequate, decent, safe, sanitary,
and affordable housing stock; that accomplishing the goals of tYus Program is a public purpose
and will benefit the residents of the City; that the need exists within the City to provide in a
tunely fashion additional affordable rental housing to and for the benefit of elderly persons
residing and expected to reside within the City; that there exist or are expected to exist persons
within the City who are and will be able to benefit from and are in need of the Program; that the
Program is necessary in view of the limited resources that may be available to such persons
relative to the expenses involved in accomplishing the type of objectives outlined in this Program
in the absence of one or more of the forms of assistance described herein or otherwise available
pursuant to the Act; and that the City and HRA hereby fmd that such forms of assistance are
often necessary for the benefit of such persons, families, and goals and that, furthermore, the
successful implementation of the objectives of the kind described in this Program has been found
to provide impetus for the development of other housing in the City, as well as the general
development of the City, by other persons who are not the beneficiaries of such governmentally
sponsored or assisted activities.
Rental Housing Purposes. More particulazly, the City and HRA find that there exists a
need for senior rental housing, alone due to a variety of factors, including that the cost of new
construction of multi-family rental units may in many cases prove economically unfeasible, given
the high costs of construction and prevailing area rental levels, and that therefore appropriate
levels of public assistance may be helpful and necessary in bridging that gap.
General Description of the Proeram. This Program consists of the fmancing of the
acquisition, conshuction, and equipping of a senior, independent living rental housing project
consisting of an approximately 60 unit residential rental project. The initial owner of the Project
will be Lyon's Court Limited Partnership, a Minnesota limited partnership, (the "Company").
The Act does not impose any income limits on the tenants. Under federal law, at least 20 percent
of units must be occupied by persons or families whose family incomes do not exceed 50 percent
of area median gross income or 40 percent of the units must be occupied by persons or families
whose family incomes do not exceed 60 percent of area median gross income. The expected
base monthly rents will be approximately as follows:
One Bedroom $690.00 — 830.00
Two Bedroom $995.00
03 �tn q-
Location. This Program is limited to the Project. The Project is located at 230 East
Tenth Street in Saint Paui, Minnesota.
Revenue Bonds. The amount of revenue bonds required to fmance this Program is
approximately $5,000,000. The proceeds will fmance the acquisition, construction, and
equipping of the Project and pay costs of issuing the bonds, and may be used to establish a
reserve.
The Project will be operated as an elderly multifanuly rental housing development within
the meaning of Minnesota Statutes, Section 462C.02, Subd. 5. The HRA will issue multifamily
housing revenue bonds (the "Bonds") pursuant to Minnesota Statutes, Chapter 462C.07, Subd. 1,
and loan the proceeds of the Bonds to the Company to fmance the Project. The HRA will loan
the proceeds from the sale of the Bonds to the Company pursuant to a revenue agreement (the
"Loan Agreement") by and between the IIIiA and the Company. The Company will be required,
pursuant to the Loan Agreement, to make payments sufficient to pay when due the principal of,
premium, if any, and interest on the Bonds. The Bonds may be structured so as to take advantage
of whatever means aze available or necessary and aze permitted by law to enhance the security for
and marketability of the Bonds. Substanrially all of the net proceeds of the Bonds (the initial
principal amount thereof, less any amounts deposited in a reasonably required reserve ar paid out
as costs of issuance of the Bonds) will be used to pay the costs of the Project, including any
functionally related and subardinate facilities.
The HRA has adequate existing capacity to administer, monitor and supervise the Project
in order to insure that the Project will be consistent with the HRA's Housing Plan. The Company
will construct the Project in compliance with a11 applicable development restrictions, and all new
construction and rehabilitation of the eatisting buildings is subject to applicable state and local
building codes. The Company will be required to operate the Project in accordance with state
and local anti-discrimination laws and ordinances.
The costs of the Project and the Program undertaken to finance the Project, including
specifically the costs to the IIRA, will be paid or reimbursad by the Company.
Housine Plan. The City and HRA hereby adopt the Comprehensive Housing Plan of the
City of Saint Paul as the housing plan relating to the Project.
Monitorina. The Program will be monitored by the HRA. The HRA expects to enter into
or continue suitable agreements with necessary parties to ensure consistent compliance with the
objectives of this Program, as well as with the requirements of applicable law.
Meetin Needs: Methods. The Program will meet the need for rental housing for elderly
persons. The City and HRA believe that this Program will help meet the identified needs under
this Program. The specific methods anticipated to be used include the issuance of revenue bonds
under the Act to provide feasible fmancing for various aspects of the Program so undertaken.
The HRA will monitor the implementation of this Program pursuant to its loan agreement for the
Project.
Autharization. The Program is undertaken pursuant to Minnesota Statutes, Chapter 462C
and is consistent with the HRA's Program.
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