03-142��i������
Council File # � - � a
Green Sheet # 1. �`�{.O 3�
RESOLUTION
CTTY OF SAINT PAUL, MINNESOTA
Presented By
Referred To
Committee: Date
3�
RESOLUTION APPROVING THE PURCHASE OF THE
TAXABLE TAX INCREMENT BONDS (SPRUCE TREE
CENTRE RAMP PROJECT), SERIES 1988A
1 WHEREAS, pursuant to an Indenture of Trust dated as of March 1, 1988 (together with
2 the amendment described below, the "Indenture"), between the Housing and Redevelopment
3 Authority of the City of Saint Paul, Minnesota (the "HRA") and First Trust National Association,
4 now lrnown as U.S. Bank National Association (the "Trustee"), the HRA has issued its
5 $3,975,000 TaY-Exempt TaYable Tas Increment Bonds (Spruce Tree Cenire Ramp Project),
6 Series 1988A (the `Bonds") to finance the construction of an approximately 354 stall parking
7 ramp (the "Ramp") adjacent to the Spruce Tree Centre proj ect at the corner of University and
8 Snelling Avenues;
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WHEREAS, pursuant to the terms of the Indenture and the Bonds, the Bonds were
subject to mandatory purchase and were remarketed as of March 1, 1993, and in connection
therewith the IIRA and the Trustee entered into a First Amendment to the Indenture dated as of
March 1, 1993;
WHEREAS, the Bonds are again subject to mandatory purchase and remarketing, or
prepayment, on Mazch 1, 2003 (the "Mandatory Purchase Date");
WfIEREAS, the Ramp was originally constructed to alleviate a shortage of on street
parking, to remove conflicts between residential, institutional and commercial parking demand in
the Spruce Tree Centre Area, and to ameliorate adverse air quality conditions existing at the
intersection of Snelling and University Avenues to facilitate the future development of other
areas along University Avenue;
WHEREA5, at the time that the Bonds were initially issued, the City recognized that the
25 successful operation of the Spruce Tree project depended on access to reasonably priced parking
26 in the Ramp, considering the cost of parking for office and retail uses in the surrounding
27 neighborhood, and the competition from commercial facilities in outlying areas that provide free
28 parking and, as a result, the City provided its support to the Ramp by entering into (a) an annual
29 appropriation lease dated as of March 1, 1993 and entered into between the HRA, as the owner of
30 the ramp, and the City, as its operator (the "Lease") and (b) a Parking Operation and
31 Management Agreement with Spruce Tree Centre, L.L.P. ("Spruce Tree"), the owner of the
32 adjoining Spruce Tree Centre, whereby Spruce Tree operates the Ramp, and provides the City
33 with a fixed annual fee for the operation thereof;
ORIGI;��A�
03- i�2-
1 WHEREAS, when the Bonds were initially issued, they were secured by: (a) tax
2 increments generated from the Hauimond, Spruce Tree Centre and Metz Bakery Taac Increment
3 Dishicts; (b) repayments of a certain Urban Development Action Grant ("[JDAG"); and (c)
4 amounts received by the HRA from the City as rent under the Lease;
6 WHEREAS, pursuant to the Lease, and subject to annual appropriarion by the City, the
7 city has agreed to pay annual rent in the amount needed to pay principal and interest on the
8 Bonds, after taking into account the availability of other funds pledged to such payxnent;
10 WHEREAS, during the period from the issuance of the Bonds to the present, the City has
11 never had to pay rent under the Lease, and the principal and interest on the Bonds have been paid
12 in full and on time from other pledged funds;
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WHEREAS, the H2minond District was terminated in 1993 and no longer produces tax
increments, and the UDAG has been repaid and is no longer auailable as a source of revenue
supporting the Bonds;
WHEREAS, it has been represented to the City that tax increments pledged to the
payment of the Bonds will continue to be sufficient to pay principal and interest due on the
Bonds, and the City understands that if, for whatever reason, the City chooses to terminate the
Lease through non-appropriation, tax increments will be the sole source of payment for the
Bonds;
WHEREAS, although ongoing operation and maintenance expenses are paid by Spruce
Tree from Ramp revenues the City remains obligated to make capital improvements to the Ramp,
as needed, and the annual fee paid to the City by Spruce Tree is escrowed for such purpose;
WHEREAS, on the basis of mazket informarion provided by RBC Dain Rauscher, the
remarketing agent for the Bonds, among other things, the City's Office of Financial Services has
recommended that the City purchase the Bonds, as an investment, and in fiutherance of the
City's economic development and financial practices policies:
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Saint Paul
as follows:
1. Although the purchase of the Bonds is not specifically authorized by the City's
Inveshnent Policy or Minn. Stat. Chapter 118A, it is hereby found and determined that the use of
City funds to purchase the Bonds is authorized by the City's charter and by Chapter 376, Article
4, Laws of Minnesota for 1992 as an investment in the City's economic development program in
general, and in connection with the financing of a public parking facility, the continued operation
of which is needed in order to achieve the objective of the City's redevelopment plan for the
Snelling and University Avenue Area.
O�IG�iv��
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2. The City's Office of Financial Services is hereby authorized to use City funds to
purchase the Bonds, as such Bonds may be modified in connection with their remazketing, and
on such terms and conditions, as the D'uector, Office of Financial Services deems to be
reasonable and prudent for an inveshnent of such funds, including specifically terms relating to
the interest rate on the Bonds through their maturity in 2013, oprional redemption, and any
collateral security therefor.
o�-�w�
antl Mana9emeM Services
pATE INRIATED
��3 GREEN SHEET
No 114037
InHiaVDate
I u DEPARTMENTDQtECTOR i QI CRYCOUNCIL
GENDA BV (DATE) � ^LL �
NU IBER WR � CT'ATfOrsxEY �� CITYCLERK
ROUTING I
❑ FINANCWLSERVICESDIR _� FIWWCLILSERV/ALCtG
ORUEFi I
� MAYOft ❑
TOTAL # OF SIGNATURE PAGES 1 (CLIP ALL LOCATIONS FOR SIGNATURE) �
resolution gives ihe Office of Finar�cial Services the authority to W�� � Housirg aM RedevelopmerRAWwritys
Erzempt Ta�cable Ta< IncrCment BoMLS (Sp�uce Tree Centre Ramp PryeCt) as autho�¢ed by fhe Cib/s charter arid by Chapter 376, Article 4,
s of Minnesota fw 1H92.
that the City can tlo this, City Counc� neetls to author¢e the use Mthe charter antl laal law.
; KEWMMENUA fION Approve (A) or KeJec[
, PLANNING COMMISSION
CIB COMMITTEE
' CNIL SERVICE COMMISSION
PERSONAL SERVICE CONTRIICTS MUST ANSWEft TNE FOLLOWING QUESLIONS:
1. HasthispersoNfrmeverworkedwWeraconiractforthisdepartmenl?
YES NO
2. Has this persoNfirtn ever been a city employee?
VES NO
3. Dces this perso�rm possess a skill not normally possessetl by any current city employee?
YES NO
4. Is this persoNfirm a targetetl ventla?
YES NO
Exolam all ves ansrvers on separate sheet and attach to qreen sheet
INITIATING PROBLEM ISSUE, OPPORTUNITY (Who, What, When, Where, Why)
ihe HRA bonds are sub�ect to mantlatory purchase antl remarketing on March 1, 2003. The Ciry would like to purchase these bontls and is able to do so under the Crty charter
and local law, wiN Ne consent of the City Council. '� �---
� �.A3�� L`�3 f.�'?�4a�
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Office of Pinancial Services can pumhase these bonds for the City's poole� portfolio.
iHDVANTAGESIFAPPROVED
�ne.
iADVANTAGESIFNOTAPPROVED
e City will not be able to purchase ihe bontls.
�TALAMOUNTOFTRANSACTIONS S�.a9o.0ooao
MDING SOURCE
IANCIAL INFORMATION (EXPV+IN)
preresgs.xls
�; �� � ; 2�g3
: �M:
COST/REVENUE BUDGE7ED (CIRCLE ONE)
ACTIVITY NUMBER
2/4/2003
YES NO