05-548Council File # O � — � ° V
Resolution #
Green Sheet # �� f
RESOLUTION
SAINT P�UL, MINNESOTA �
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Presented By
ReEerred To
Committee: Date
1 APPROVIlVG AN AMENDED AND RESTATED SINGLE FAMII,Y HOUSING
2 FINANCE PROGRAM TO BE FINANCED BY TI� ISSUANCE OF SINGLE FAMIL,Y
3 MORTGAGE REVENUE BONbS
6 WHEREAS, pursuant to the Mivnesota Municipal Housing Act, Minnesota Statutes, Chapter 462C (the
7"Housing AcP'), the City of Saint Paul, Minnesota (the "Cit�') is authorized to carry out programs for the
s financing of single family housing for persons of low and moderate income; and
lo WIIEREAS, the Minneapolis/Saint Paul Housing Finance Boazd (the "Board"), a joint powers board
11 organized under a Joint Powers Agreement (the "Joint Powers Agreement") originally dated as of December 1,
1z 1984, and as subsequenUy amended, by and between the Housing and Redevelopment Authorily of the City of
13 Saint Paul, Minuesota (the "Authorit}�') and the City of Minneapolis, Minnesota ("Minneapolis") and accepted
1 a by the City, and under the laws of the State of Minnesota, proposes to undertake an amended and restated single
15 family housing finance program relating to the Mimieapolis and the Saint Paul entitlement allocations available
16 in 2005 and certain recycling refunding bonds (the "Amended Program"), to be fivanced by the issuance of one
1 � or more series ofmortgage revenue obligations and mortgage revenue refunding obligafions pursuantto Mixuiesota
18 Statutes, Sections 469.001 to 469.047, Chapters 462A, 462C and 474A and Section 471.59 (together with
19 applicable predecessor provisions of state law, the "AcY'); and
20
21 WI IEREAS, pursuant to the Act, the Boazd is authorized to issue bonds from tnne to time and to use the
22 proceeds of its bonds to make or purcl�ase mortgage loans or to purchase participations in mortgage loans from
z3 lending insritutions in order to finance the construction and rehabilitation, and to facilitate the purchase and sa1e,
24 of single family housing for eligible persons or families under the Act and to issue bonds to refund previously
25 issued bonds; and
26
27 WHEREAS, the Amended Progratn will provide below market interest rate mortgage loan financing or
28 income taY credits primarily to persons of low or moderate income purchasing single family homes to be used as
29 their principal places of residence and which are located within the geograpluc limits of the City or Minneapolis;
3o and
31
32 WHEREAS, the Act requires adoption of the Amended Program afker a public hearing held thereon
33 following publication of notice in a newspaper of general circulation in the City and Minneapolis at least fifteen
34 days in advance of the hearing; and
35
36 WIIEREAS,theCityCouncilhasonthedatehereofconductedapublichearingontheAmendedPrograin,
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37 after publication of norice as required by the Act; and
38
�9 WHEREAS, the Amended Progr<un was submitted to the Metropolitan Council at or before the time of
4o publication ofnotice ofthe public hearing on such Amended Program, and the Metropolitan CouncIl was afforded
41 an opportunity to present comments at the public heariu�, all as required by the Act; and
42
4� WHEREAS, the Amended Prograui provides for the issuance of single family mortgage revenue bonds
44 or revenue refunding bonds in one or more series pursuant to the Act (the `Bonds'� to make or purchase or cause
45 to be made or purchased mortgage loans, or to purchase securities the proceeds of which would be used to
46 purchase mortgage loans to finance the acquisition, primarily by low and moderate income persons and families,
47 of single family housing located within the geographic boundaries of the City or Minneapolis; and
48
49 WHEREAS, it is proposed that the Amended Program be approved and the Boazd be authorized to issue
5o Bonds pursuant to the Amended Program and the Joint Powers Agreement; and
51
52 WI IEREAS, the Amended Program and the issuance of Bonds by the Board or the Authority aze in the
53 best interests of the City.
54
55 NOW, THEREFORE, BE IT RESOLVED BY TT� CITY COUNCIL OF TF� CITY OF SA1NT PAUL
s6 AS FOLLOWS:
57
5s 1. The Amended Program is hereby approved in its entirety in substantially the form on file with the
59 City. The officers ofthe City and the Board are authorized to take a11 actions as may be necessary or appropriate
6o to carry out the Amended Program in accordance with the Act and any other applicable laws and regulations.
61
62 2. The issuance of the Bonds putsuant to the Amended Program is hereby approved subject to
63 agreement by the Board and the purchasers of the Bonds, if any.
64
65 3. The Bonds may be issued in one or more series at the time or times and pursuant to terms
66 deteimined by the Board, and be shuctured so as to take advantage of whatever means are available and are
67 pernutted by law to enhance the security for, or marketability of, the Bonds, provided that any such financing
6s slructure must be approved by the Board. All such determinarions by the Boazd must comply with the applicable
69 provisions of the Act and the Intemal Revenue Code of 1986, as amended, and regulations promulgated
70 thereunder.
71
72 4. The Board is authorized to take all actions which may be necessary or desirable in connection with
73 the issuance of the Bonds, acting on behalf of the City, and no further approval or consent of the City shall be
�4 required prior to the issuance of the Bonds by the Board, or prior to the taking of any action by the Board to
�5 undertake and implement the Amended Program.
76
�� 5. Nothing in this Resolurion or the documents prepazed pursuant hereto sha11 authorize the
�s expenditure of any municipal funds on the Amended Program other than as specified and authorized by separate
�9 acrions of the City and other than the revenues derived from the Amended Program or otherwise granted to the
8o City for tlus purpose. The Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any
81 property or funds of the City except the revenues and proceeds pledged to the payment thereof, nor sha11 the City
sz be subject to any liability thereon. The holders of the Bonds shall never have the right to compel any exercise of
83 the tasing power of the Ciry to pay the outstanding principal on the Bonds or the interest thereon, or to enforce
84 payment against any properry of the City. The Bonds shall recite in substance that the principal and interest
85 thereon, aze payable solely from the revenues and proceeds pledged to the payment thereof. The Bonds sha11 not
86 constitute a debt of the City within the meaning of any constitutional or statutory limitafion of indebtedness.
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s7 6. Any one or more series of the Bonds may be issued by the Authority in lieu of issuance by the
8s Boazd, at the discretion of the Authority.
Requested by Department of:
Plannina & Economic Develooment
Adopted by Council: Date V�� �"� �o
Adoption Certified by Council Secretary
By: / / �/Pl✓fG9 / ,C�'!��
/ '
Approved by
V� �
Date
• /'\ �
By:
By: (.(�/���
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Approved by Financial Services
By:
7 t �
Foxm App�roved by City Attorney
By:
Approved by r for Submission to Council
B :
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� Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet �
:�, . �.
DepartmemlofficaJcouncit: Date fnitiated:
PE -p,�,�„g�&�no��n�e�o�t ,�-�Y-0S '; Green Sheet NO: 3026481
� CoMad Person 8 Phone:
� Stephanie Hawkinson � 0
I 266-6585 q�� 1
Must Be on Councii Agenda by (Date): Number 2
(ISJUN-OS For 3
Routing
� Order
I
I
Total # of Signature Pages _(Clip All Locations for Signature)
Deoartme`rt Sent To Person Initial/Date
i lannin & Economic Deveio . Deoartment DireMOr �--!�
'tv Atto ev � Ciri Attornev
avor's O�ce � Mavo /AssisTant
ouncil �
Signature on attached Resolution for adoption at a Public Hearing on June ]�2005.
Recommendations: Approve (A) or Reject (R):
Planning Commission
CIB Committee
Civil Service Commission
�
Personal Service Contracts
� '
MAY 18 Z00�
�l�Y ATTORNIE`
1. Has this person/firm ever worked under a contract for this departmenY?
Yes No
2. Has this person/firm ever been a city employee?
Yes No
3. Does fhis person/firm possess a skill not normally possessed by any
curtent city employee? �
Yes No
Explain all yes answers on separate sheet and attach to green sheet
Initiating Problem, issues, Opportunity (Who, What, When, Where, Why):
Approving an amended and restated 2005 Single Faxnily Housing Program to be financed by the issuance of Single Family Mortgage
Revenue Bonds. Bond proceeds will be used to provide loans for low or moderate income persons and families-.
Advantapes If Approved:
The City is able to provi.de loans at lower interest rates through the issuance of tax-free bonds. The program allows the G`ity to better
serve fust time home buyers.
Disadvantaqes If Approved:
None.
Disadvantages If Not Approved:
Loan funds at lower interest rate would not be available for low or moderate income persons.
Total Amount of �
Transaction:
Fundinq Source:
Financial Information:
(Explain)
CosURevenue Budgeted:
ActiviNNumber. C�gpu+il Rncnzrrh �',on;py
1 � ; � �
DS- S�y�
MINNEAPOLISlSAINT PAUL
AMENDED AND RESTATED 2005
SINGLE FANIILY HOUSING FINANCE PROGRAM
The City of Mnmeapolis, Minnesota ("Minneapolis"), the City of Saint Paul, Minnesota
("Saint Paul") and the Housing and Redevelopment Authority of the City of Saint Paul, Mimiesota
(the "Authorit�'), acting individually or joinfly tiuough the Mimieapolis/Saint Paul Housing
Finance Board (the "Joint Board") (all together, the "Issuers") propose to issue mortgage revenue
bonds and certain mortgage revenue refunding bonds under Secrion 103 of the Internal Revenue
Code of 1986, as amended (together with regulations promulgated thereunder, the "Code")„ in one
or more series, in either case to finance the single family housing finance program described herein
(the "Program") pursuant to authority conferred by Mimiesota Statutes, Chapters 462C, 462A, 469
and 474A, all as amended, (and any predecessor provisions of State law or other general or special
law authority for the issuance of obligations to finance a single family housing finance program or
development) (all together, the "AcY'). Any action specified herein to be made by the Issuers may
be made by one or more of them acting in concert or individually.
In creating tlus Progruii, the Issuers find and deterxnine:
• that the preservafion of the quality of life in Minneapolis and Saint Paul (the "Cities") is
dependent upon maintaining an adequate, decent, safe and sanitary housing stock;
• that maintaining such housing stock is a public purpose and will benefit the residents of
the Cities;
• that a need exists within the Cities to provide additional affordable owner-occupied
housing for low and moderate income persons and families and for other persons and
families to the extent necessary to promote economic integration as provided in the Act; and
� that a need exists for mortgage credit to be made available for both existing and new
owner-occupied housing, for rehabilitation of existing single family housing and for home
improvements.
To meet such needs, the Issuers intend to issue one or more series of single family mortgage
revenue bonds and single family mortgage revenue refunding bonds ("Bonds") to cause the
origination of mortgage loans to finance the acquisition, conshucfion, rehabilitation or improvement
of single family housing in the Cities (or either of them). The Issuers may issue Bonds in an
aggregate principa) amount of appro�mately (a) $36,709,000 for Minneapolis and $27,529,000 far
Saint Paul, representing certain 2005 entitlement bond allocation of Minneapolis and Saint Paul; (b)
draw down bonds in the amount of $213,000,000; and (c) approximately $100,000,000 of refunding
bonds to fund the acquisi6on of mortgage loans, but which in any event shall be an amount
sufficient to refund outstanding mortgage revenue bonds and to recycle refund prepayments and
repayments of certain outstanding bonds; and (d) such principal amount of tasable bonds as may be
necessary or convement to further the purposes of this Program.
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Mortgage loans financed through the issuance of the Bonds will be subject to the following
terms (or, for Bonds as to which these requirements do not apply as a matter of law, to such other
terms approved by the Board):
ourchase price - the maxiinum purchase price for financed homes shall not exceed
the lesser of (a) 90% (ll0% in "targeted azeas" or areas treated as targeted areas) of the
applicable "average azea purchase price" detemuned by the United States Department of the
Treasury or by the Issuers on the basis of more complete information, or (b) 3 tunes the
applicable income lunit for the Program imposed by Minnesota law (except that in certain
azeas the purchase price shall not exceed 4 times the applicable income lunit to the extent
consistent with applicable federal law);
income lnnits - the m�imum income of the mortgagors sha11 be the lower of (a) the
income restrictions imposed by federal tax law or (b) the income xestrictions imposed by
Minnesota Statutes, Section 462C.03, Subd. 2, including the restricrion of Subd. 7 that for
the first six months of the Program, 50% of the money available to make mortgage loans or
the "non-issued bond amount" of MCCs must be reserved for persons and families with
adjusted incomes not greater than 90% of the general Program income limits. Income limits
under Section 462C.03, Subd. 2 shall be adjusted for fanuly size by deducting $1,000 per
adult and $1,200 per child in the family.
In connection with this Program:
(i) (a) in connection with any mortgage loans financed with the proceeds of
mortgage revenue bonds, any fmancial institutions described in Section 462C.03,
Subd. 4, and other mortgage lenders with offices located in the Cities and which are
FIIA/VA approved sellers of mortgage loans as well as other fmancial institutions
and mortgage lenders wluch are FHA/VA, or FNMA/F'HLMC approved sellers of
mortgage loans and are reasonably acceptable to any master servicer acting on
behalf of the Issuers, will be eligible for consideration for origination of such loans;
the Cities will not limit participation in the Program to a single lender unless other
lenders aze not willing to participate for the consideration offered; the Authority
shall be eligible for considera5on for origination of loans;
(b) in connection with issuance of MCCs, MCCs will not be limited to
loans originated by particular lenders but will be available with respect to the
origination of qualifying mortgage loans by any par[icipating lender;
(ii) loans will not be made available or set aside far the exctusive use of
developers or builders except, in the case of mortgage loans financed with the proceeds of
mortgage revenue bonds, for new housing described in Section 462C.071, Subd. 2;
(iii) the Issuers expect to act as, or to contract with, a program administrator and
a servicer to provide services to ensure that the Program will be consistent with this
Program, the Act and applicable £ederallaw;
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(iv) as indicated above, the Cities respecrive 2005 entitlement allocations may be
used in the Program, provided, however, that no provision of this Program shall in any way
prevent either Minneapolis or Saint Paul from using all or a portion of its respective
entitlement allocation(s) for multifamily housing or any other authorized purpose. In
addition, any election made by the Cities to issue Mortgage Credit Certificates ("MCCs") in
lieu of Bonds may be revoked in whole or in part, at any time during the calendaz year in
which the election was made as pernutted by Section 25 of the Intemal Revenue Code and
Section 1.25-4T(c)(3) of the Treasury Regulations. The resulting unused entitlement
allocation may be used to issue bonds for single fanuly housing or other authorized
purposes;
(v) the Program will meet the needs of low and moderate income families by
providing below-market rate financing for the acquisition or rehabilitation of single family
homes or by providing a tax credit for mortgage interest paid, thereby enabling such persons
to qualify for mortgages which would be unavailable at market rates;
(vi) no homes which are located in previously unincorporated real property
annexed by the Cities witkun one year prior to the date of adoption of this Program will be
financed under tlus Program;
(vii) prohibitions or limitations on assumption will be imposed to the exteni
required by federal law relating to the tax exempt status of Bonds issued pursuant to the
Program; provided that the Issuers may impose more stringent limitarions at their discretion;
(viii) the estimated amount of mortgage loans to be made or purchased pursuant to
this Program is appro�mately equal to the aggregate principal amount of Bonds issued;
(ix) the estimated aggregate principal amount of the Bonds is set forth above;
(x) the Bonds, if issued, may be issued in one or more series timed for sale
consistent with the needs of the Ciries in 2005 and the durarion of any origination period
provided in connection with the Bonds, or, if any bond allocation is carried forward for
single fanuly purposes, in 2006;
(xi) refinancing of existing indebtedness will be permitted only where the
mortgage loan also finances substantial "rehabilitation" as that term is defined under
Minnesota Statutes, Section 462C.01 and Section 462C.03, Subd. ll and under Secfion 143
of the Code;
(xii) to the extent required by the Act, during the first ten (10) months of the
origination period, loans financed by the Bonds (but not mortgage loans assisted by MCCs)
will be made for existing housing;
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