05-918Council File # ��
Presented by
Referred To
GreenSheet# 30��Si�.��P
RESOLUTION
OF SAINT PAUL, M{NNESOTA 15
Committee Date
City Council Resolution
[Minnesota Public Radio]
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WITEREAS:
1. The Port Authority of the City of Saint Paul (the "Port Authorit}�') has given its approval to the
issuance of its Variable Rate Revenue Bonds (Minnesota Public Radio Project) Series 2005-7 (the `Bonds") inffie
aggregate principal amount of $11,500,000. The proceeds ofthe Bonds willbe loanedto Mumesota Public Radio,
a Minnesota nonprofit coiporation ("MPR") foz its use in financing a project consisting of (a) the acquisltion
and improvement of a radio broadcast license and of radio transmission equipment and a leasehold interest in
space on a 500 foot radio tower located on Olmsted County Road ll 9, in Haverhill Townslup, Olmsted County,
Minnesota, and (b) the acquisition and improvement of a radio broadcast license, and of a leasehold interest in
land, an 800-foot radio tower, radio transmission equipment, and a building located at 17979 Annette Avenue in
Empue Townslup, Dakota County, Minnesota (collecrively the "ProjecP').
2. Laws of Minnesota 1976, Chapter 234, provides that any issue of revenue bonds authorized by
the Port Authority shall be issued only with the consent ofthe City Council of the Ciry of Sairn Paul, by resolution
adopted in accordance with law.
3. Approval ofthe issuance ofthe proposed Bonds by ffie City Council is also required by Section
147(� of the Intemal Revenue Code of 1986, as amended.
4. To meet the requirements of both state and federal law, the Port Authority has requested that
the City Councfl gives its requisite approval to the issuance of the proposed Bonds by the Port Authority,
subject to final approval of the detaIls of said Bonds by ffie Port Authority.
NOW, TFIEREFORE, BE IT RESOLVED by the Council of the City of Saint Paul that, in accordance
with the requirements of Section 147(� ofthe Internal Revenue Code of 1986, as amended, and in accordance with
Laws of Minnesoh 1976, Chapter 234, the City Council hereby approves the issuance of the aforesaid Bonds by
the Port Authority for the purposes described in the Port Authority resolution adopted August 23, 2005, the eacact
details of wlrich, including but not limited to, provisions relating to principal amount, maturities, interest rntes,
discount, redemption, and the issuance of additional bonds are to be detennined by the Port Authority, andthe 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 puiposes for which the aforedescribed Bonds aze
issued.
Adopted: October � 2005
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AdoptedbyCouncil: Date �L s a00S
Adoprion Certified by Council Secretary
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35089.v1
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Green Sheet NO: 3028216
Approval of the issuance of approrzimately $11,SOQ000 of 501(c)(3) conduit iaz exempt bonds to 5nance Minnesota Public Radio's
acquisition and impxovement of two xadio shtions.
Recommendations: Approve (A) or R
_ Planning Commission
_ CIB Committee
Civil Service Commissian
�
7. Has fhis person/firtn ever worked untler a contract for ihis department?
Yes No
2. Has ihis person/firm ever been a cily employee?
Yes No
3. �aes this persoNfirtn possess a skill mt normalfy passessed 6y any
curtent ciry employee?
Yes No
Explain all yes answers on separete sheet antl attach to green sheet
In�tiating Problem, Issues, Opportuniry (Who, What, When, Where,
MPR financed the acqwsilion with a tempoxazy loan. TLat lender would like the permanent 5uancing in place by tlie end of the yeaz.
Any taxable financ�ng mll be more expensrve tUan the proposed tax exempt fmancing.
AdvantaAes If Approved:
The issuance of the bonds will attow MPR to xeduce rts financ�ng costs by appro�mately $240,000 annually. This sav�ngs can be used
to pxo�ide its services to St. Paut residems. 16 newjobs were added to downtown as a result of tlus acquisieon.
Disadvantapes If Approved:
None
Disadvantapes If Not Approved:
MPR's service to St. Paul residems could be reduced.
Total Amount of
Trensaction: ��500000 Cosf/RevenueeudgMed:
Funtlin5t Sourca: po�t Autho�ity 501(C) (3) Activity Number.
Financial Information: COOdu�t ta)c ex0mpt
, (EZplain) bO0d5
� �.ig
�
SAINT PAUL
PORT AUTHORITY
► •.. . �
TO: BOARD OF COMMISSIONERS
(Meeting of September 27, 2005)
DATE:
Sept. 22, 2005
FROM: Peter M. Kfein )V`—�
Laurie J. Hanse� S�'``�
Kenneth R. Joh s
SLTBJECT: MINNESOTA PUBLIC RADIO (MPR)
AUTHORIZATION FOR AN APPROXIMATE $11,500,000 501(c)(3)
CONDUIT TAX EXEMPT BOND ISSUE
CONTINUATION OF PUBLIC HEARING
RESOLUTION NO. 4143
ACTION REQUESTED
Approval for the issuance of an approximate $11,500,000 of 501(c)(3) conduit tax
exempt bonds for MPR.
• PUBLIC PURPOSE
The presence of MPR is important to the vitality of downtown St. Paul due both to
the size of its workforce, and the fact that, because many of the programs produced
by MPR are closely identified with St. Paui, they are important to the market
presence and image of St. Paul. As a result, keeping MPR in downtown St. Paul,
and helping them to operate in an efficient and cost effective manner, is an
important pubiic objective. Minimizing the financing costs of this acqtaisition
increases the viability of both the acquisition and the expansion praject in downtown
and thereby solidifies MPR's presence in St. Paul. The issuance of tax exempt
bonds will help minimize the financing costs, a$240,000 savings in the first year,
and because MPR is a 501(c)(3) organizafion, these bonds are not subject to a
volume limitafion that is imposed on other types of tax exempt bonding. The
acquisition by MPR of the radio towers and equipment being refinanced by the
issuance of the proposed bonds, resulted in the addition of 16 jobs in St. Paul.
BUSINESS SUBSfDY
The proposed issuance of bonds is for a not-for-profit organization and is exempt
from treatment as a business subsidy.
BACKGROUND
At its August 2005 meeting, the Credit Committee recommended to send the
� proposed issuance of $11,000,000 of conduit tax exempt bonds for Minnesota
Public Radio to the Board for its approval. Several quesfions have been raised at
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and subsequent to that meeting. Some of the information that was requested had
. prev�ously been mcorporated into the August 2005 Board memo. The atEached
report has not been changed from the August Board memo. However, the
following information in this section is new and responds to questions that
have arisen: �
In the analysis of whether the Port Aufhority should issue tax exempt debt for MPR's
purchase of finro radio stations, we have found that: (A) many other communities
have issued tax exempt debt for this purpose; (B) Saint Paul has done so in the
past; and (C) the public purpose for issuing tax exempt debt is similar to the other
501(c)(3j financings approved by the Port Authority in the past five years.
(A) Other communities have financed the purchase of radio stations with tax
exempt financing. The following financings for such purposes have occurred in the
past five years:
➢ Coforado Public Radio 2001
➢ Nashville Public Radio 2002
➢ Okiahoma State University 2004
➢ University of Cincinnati 2005
KKYD $ 4,200,000
WQDQ $ 3,000,000
KGND $ 4,000,000
WVXU $15,000,000
(B) Saint Paul has issued tax exempt debt for the purchase of a radio station in the
past. The HRA issued $12,000,000 of tax exempt debt for MPR's 1990 purchase of
• WLOL, which was also physically located outside of Saint Paul.
(C) Although the not-for-profit entities that the Port Authority has issued tax exempt
debt for have divergent missions, they all provide for the enhancement of our
community and qualify for the benefit of tax exempt debt under Federal and State
law. ln addition to the current consideration of financing for MPR, the Port Authority
has issued, or is considering the issuance of, tax exempt debt for the following
501(c)(3) organizations in the past five years:
➢ Minnesofa Diversified Industries
➢ District Energy / Cooling
➢ Model Cifies
➢ Board of Sociai Ministry
➢ Second Harvest
➢ Sairrt Pascai Baylon School
➢ New Fiarmony Care Center
➢ Hmong American Partnership
➢ HealthEast
➢ Memorial Blood Cenfer - Pending Approval
•
A grid of these financings, which provides a comparison of certain feaYures, is
attached. As the grid indicates, the Port Authority has issued bonds for 501(c){3)
projects outside of St. Paui and to refinance the existing debt of 501(c)(3) entities.
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• This proposed financing for MPR does not vary significantly from other not-for-profit
financings that have been approved and consummated by the Port Authority in the
past, nor does this proposed financing violate any exisfing guidelines of the Port
Authority Board.
At the request of the Credit CommitEee, MPR wrote a letter dated September
22, 2005 to the Port Authority which describes its process and timing of
financing the acquisition of the radio stations, The IetEer indicates that MPR
always anficipated the use of tax exempt financing for the permanent
replacement of the interim ta�cable financing. The letter, along with its
atEachment, has been included.
POLICY EXCEPTIONS
None.
WORKFORCE IMPLICATIONS
MPR added 16 new jobs in Saint Paul as a result of the purchase of these radio
stations. It empioys over 300 people in Saint Paul, most of whom live in Saint Paul.
• DISCLOSURE
The Port Authority Commissioners by SEC rules are obligated to disclose any risks
of facts you may be aware of that would affect the probability of repayment on these
bonds.
RECOMMENDATION
We recommend approval of this transaction.
PMK:ah
•
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•
With respect to the Olmsted County facilities, bond proceeds
will be used to refinance the cost of acquiring the radio
broadcast license of KMSE-88.7 FM, a leasehoid interest in a
500 foot radio tower and in a transmitterbuilding at the base
of the tower, and radio transmission equipment in the building
and on the tower, all Iocated on Olmsted County Road 119 in
Haverhiil Townsnip, Otmsted County, Minnesota.
With respect to the Dakota County facilities, bond proceeds
• will be used to refinance the cost of acqUiring the radio
broadcast license of WCAL-89.3 FM, a leasehold interest in
land, an 800 foot radio tower, a transmitter building, and radio
transmission equipment located in the building and on the
tower, a{I located at 17979 Annette Avenue in Empire
Township, Dakota County, Minnesota.
Tvpe: Qualified 501(c)(3) bonds. Unlike industrial development
(private activity) tax exempt bonds, which have a state by
state ailocation, there is no issuance cap on 501(c)(3) tax
exempt bond issuance.
•
Action Requested:
MMNESOTA PUBLIC RADIO
Approval of final resolution authorizing the issuance of an
approximate $11,500,00� conduit tax exempt bond issue for
Minnesota Public Radio.
Proiect Summarv: Proceeds of the bonds wiil be applied by the Port Authority to
refinance and reimburse Minnesota Public Radio for the costs
incurred in the acquisition and improvement of radio
broadcast licenses, radio transmission equipment and cerEain
seal estate interests in Olmsted and Dakota Counties in
Minnesota, which are now owned by Minnesota Pubiic Radio,
and are more particularly described as follows:
Term:
Issuer
Borrower
Guaranfor:
Trustee
LetEer of Credit Bank:
Underwriter•
Series 2005-7 - 20 years
Saint Paul Port Authority
Minnesota Public Radio
American Public Media Group {APMG}
Weils Fargo Corporate Trust Services
Aliied Irish Bank
Piper Jaffray & Co.
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•
Remarketinq Aqent:
Borrowers Counsel:
Underwriter`s
Counsel
Letter of Credit
Bank Counsel:
Bond Counsel:
Piper Jaffray & Co.
Faegre & Benson, LLP
Briggs & Morgan
Schiff, Hardin & Waite
Leonard Street & Deinard
The Comaanv: Minnesota Public Radio ("MPR") is a Minnesota nonprofit
corporation that produces, acquires, broadcasts and
distributes public radio programming to Minnesota and the
nation.
Founded in 1967, MPR currently operates a regional dual
channei �etwork of 51 stations and translators with distinctive
services in classical music and news and information, along
with a third channel serving the Twin Cities and Rochester.
These stations include KCMP 89.3 FM, KNOW 91.1 FM, and
KSJN 99.5 FM serving Minnesota's Twin Cities. More than
750,000 Minnesota residents listen to these program services
in a given week. Through its national production and
distribution division, American Public Media (APM), MPR
produces and distributes programs to public radio stafions
around the world. MPR and APM (MPR/APM) operate
Internet sifes and present live events in Minnesota and
around the U.S.
The Guarantor: MPR is part of a larger family of companies with a parent
support organization, American Public Media Group (APMG).
In connection with the issuance of the Bonds, APMG wili
execute a Guaranty, whereby it will unconditionally guarantee
the payment of amounts due from the Borrower under the
Loan Agreement on account of principai, interest and
purchase price due on the Bonds.
Estimated Sources and Uses of Funds:
Sources of Funds
Bond Proceeds
�, �� ���
Use of Funds
Reimbursement of acquisition costs through repayment of $ 11,300,000
interim loan and costs of acquiring and installing add'I equipment
� Cost of issuance 200.000
Total $ 11.500.000
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• The Bonds: The Bonds wiil be issued in the approximate principal amount
of $11,500,000. The bonds will bear interest af a variable
rate established weekly by the Remarketing Agent.
Fees: The Port Aufhority will receive a fee of 1.00% of the principal
amount of the bonds at Gosing, and .10% of the principal
amount of the outstanding bonds annually thereafter.
Conduit Financinp: The bonds wili be conduit financing of the Authority and wiil
not constitute or give rise to a liability of the Authority, the City
of Saint Paul, or the State of Minnesota or a charge against
their general credit or taxing powers.
Loan Aqreement: Under the Indenture, the Authority has pledged its interest in
the Loan Agreement to the trustee to secure the bonds. The
trustee is authorized to exercise the rights of the Authority
and to enforce the obligations of the borrower under the Loan
Agreement.
Letter of Credit: The bonds are offered primarily based on the financial
strength of the Letter of Credit bank and not based an the
financial strength of the Borrower. The Letter of Credit will
terminate in September 2010 unless sooner terminated in
• accordance with its terms. The Letter of Credit may be
extended at the request of the Borrower for addi4iona4 one-
year or longer periods. If the Letter of Credit is not renewed
or replaced, the bonds will be subject to mandatory
redemption and the trustee wiil be instructed to draw on the
Letter of Credit before it expises to pay principal and interest
then due.
Recommendation: We recommend approval of authorizing issuance of the
approximate $11,500,004 conduit tax exempt bond issue on
behalf of Minnesota Public Radio.
•
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Thomas J Kigin
Execuiive Vice President
Chief Administrative �eer
General Caunsel
Minnesota
Radio�
�����
September 22, 2005
Mr Kenneth R Johnson
President
Port Authority of the City of Saint Paul
345 St Peter Street
I900 Landmark Towers
Saint Paul, MN 55102
Deaz Ken:
Thank you for the kind reception at your Credit Committee meeting, and for the
opportunity to provide additional information about the process we have pursued in
financing the purchase of WCAL (now KCMP 893 The Ctiurent).
When the Minnesota Public Radio Boazd authorized the purchase of WCAL from Saint
• Olaf College on August 6, 2004, they anticipated the availability of tax exempt financing
for the purchase, and authorized the submission of a request to tke Aousing and
Redevelopment AuthoriTy of the City of Saint Paul (HRA) for such financing. Knowing
that the process of securing such financing can take longer than it is possible to wait to
close an acquisirion, they also authorized management to seek out short term interim
financing.
MPR's agreement to purchase WCAL was announced on August 10, 2004, but the sale
could not be closed immediately because at required FCC approval.
A significant factor in the MPR Boazds willingness to take the risk of this aequisition was
the ability of MPR, as a 501(c){3) organization, to access the tax exemgt bond market,
and the confidence that tae e�cempt financing would be available, given the fact that the
IIR A had previously (in 1990) provided MPR with tax exempt financing for the purchase
of another radio starion located physicaliy outside of the City. The Boazds analysis was
th2t, if tax exempt financing were availabie, the ]ower bonowing cost would allow the
organization to more efficiently and cost effectively support its mission of providing
existing program services (a news & information station and a classical music station) as
weli as the operation and financing of the new station.
• 2669754v1
45 East Seventh Street, Saint Paul, MN 55101
Phone 651 290 1554 Fae 651 290 1243 www.mpcorg tkigin�mpr.prg
OS-`l�g
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Iztter to Mr Kenneth R 7ohnson
September 22, 2005
Page 2
A$er working with HRI� sta$' on a proposal for tax exempt fivancing, MPR appeared
before the T�2A Board on October 27, 2004, at wluch time the f3RA gave its preluninary
approval to a package of long term tax exempt frnancing that included the purctiase of
WCAL, as well as additional financing for the MPR building project in downtown Saint
Paul.
Following receipt of FCC approval, and with the HRAs preliminary approval in hand,
MPR closed on the purchase of WCAL on November 19, 2604. Since the tax exempt
financing process had not yet been completed, MPR atranged for temporary financing of
this acquisition through Allied Irish Bank (AIB) using a swing loan. AIB is a large
intemarional bank with US operations that specializes in providing financing to tax
exempt entiries. AIB was chosen as a result of a competirive bidding process that
included local and narional banks. Their commifinent fo the swing loan was coupled with
an agreement that, when the loan was"taken out; they would provide the letter of credit
necessary to support the tax exempt financing. Initially, AIB set February 18, 2005 as the
deadline for the repayment of the swing loan, but they were subsequently persuaded to
extend tbis deadline, first to June 30, 2005 and then to December 30, 2005, as we
• continued to pursue long term tax exempt financing. At the time that MPR committed to
the swing loan, both MPR and P,IB anticipated and relied on MPR's ability to repay the
swing loan with tax exempt financing, hased on the preliminaty resolution that the HRA
Boazd had unanimously approved several weeks earlier.
The unanimous approval provided by the HItA Boazd on October 27 was provided
following a public hearing, as required by federal and state law. Unforiunately, due to a
technical problem with the public hearing process, it was determined that a new public
hearing should be held. On December 6, 2004, on the occasion of that rehearing, the
HRA detenuiued (on a three to tluee vote) that tkey would not provide taac exempt
financing for MPR's puschase of WCAL. One Comxnissioner abstained from this vote
due to a conflict of interest, arising from the fact that he was employed by one of the
invesiment banking firms participating in the underwriting o€the proposed bonds. Tlris
conflict had not been noted in connection with the October vote.
Because of our confidence in the public purpose of this project, and our belief that the
project would have been approved by the HRA a second time, in its December vote, but
for the one abstenrion, MPR approached the Port Authority for financing.
I hope that this explication addresses the questions that the Credit Committee posed
during their meeting of September 20. I am, of course, available to provide any
additional information that might be desired.
�
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•
•
Letter to Mr Kenneth R Johnson
September 22, 2005
Page 3
During the discussions with the Credit Commiitee, I mentioned that the President of Saint
Olaf College had written in.support of our financing reques� I include a copy of that
letter.
Thank you again for your time and attention to this matter.
Sincetely,
� 1 !C!t'�(�Y..
Thomas 7 Kigin
cc: Peter Klein
2669754v1
� 1��--�
12-06-04 03:54Pm From-ST OLAP PRESIDEMTS OFFICE
5urbaonaeo i-aau r.uciuc r-caa
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Offics of zhe prnident
�
� J
Sc Olaf Cull��
=S� S�- 6Laf Avenva
Nor[hfietd, MN SSo57 Us+�
Decembcr 6, 2004
{Soy) 646-;000
i5o7) 64
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Board of Commissioners
% Housing and Redevelopment Authority
City of Saint Paul
C!0 3an Ma�uson, Assistaat Secretary
Cily Hall and Coutt $ouse
15 West Kellogg Boulevard
St. Paul, MN 55102
Dear Memhers of the Boazd of Commissioners:
•
•
As a result, wa suppon your issuance of conduit revanue bond financing for rhis project.
T write regarding the application by Minnesota Public Radio for conduit revenue bond financing
re2ated to the purchase of radio station WCAL from St OIaf Coliege.
This past fall, the Board of Regents of St Olaf College made a significant strategic decision — to sell
W CAL and to foous che proceeds &om Yhe sale on the principal missifln of the coilege, the educarion
of our studen[s. While WCAL had been a wonderFut asset for the college and an important part of
the col]ege's legacy, we formed tUe opinion tl�at the coaiege and our students were better served by
investin�, iu our academic prograzns, the resources that the station regresented.
We chose a broker wlio shopped the station to a wide variety �of instirutions whom we knew to be
qualified buyers. We were pl�ased ttxa.t Minnesota Pu61ic Radio was willing to provide a
competitive offer for the station, because af its similar values, cozrunihnent to public
bzoadcasting, local ownerslup, and commitment to service !o Minnesota.
We compleTed the sale of the station to MPR on November 19 of this year.
We understand that MP�2 provided the cash fer the purchase from a short-term commercial loan,
and anticipated replacing this short-term loan with tong-term tax exempt financing. We at St
Olaf are weIl aWare of the benefits of tax-exempt financing, as we have used it for many of otrr
own proj ects. Ti2o lower interest rates on such finaucing enable us to f•ocus more of our scarce
resources on our educational mission and less on the payment ofinterest on our debt. At the
same time, such financing does not represenT any risk or burden to rhe issuing entity.
We remain convinced fhat the decision to sell WCAT., however controwersial to some, best
serves the mission of tl�e college. We ate pleased with our c]�oice of buyer. We are confident
That MPR will carry on rhe ]egacy of WCAL in providing exemplary serviee to fhe communiry,
including to SY Faul. And, while MPR continues the legacy of service Yluough public radio, we
will be able to devote the proceeds oFthis sale to enhance our core educational mission,
Szneerely,
t�f �T/6 �
Christopher M Thomforde
President
St O1af College
CMThk
12
05
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Resolution I�TO. 4143
RESOLUTION OF T`HE
PORT AUTHORITY OF THE CITY OF SAINT PAUL
C�./�.1 '�.`�
1. It has been proposed that the Port Authority of the City of Saint Paul (the
"Port Authorit}�') issue its Variable Rate Revenue_ Bonds (the `Bonds'� in an ag�egate
principal amount of approximately $11,500,000 and that the pXOCeeds of such Bonds be
loaned to Minnesota Public Radio, a Minnesota nonprofit corporation ("MPR") for its use
in financing a project consisting of (a) the acquisirion and improvement of a radio
broadcast license and of radio transxnission equipment and a leasehold interest in space
on a 500 foot radio tower located on Olmsted County Road 119, in Haverhill Township,
0lmsted County, Minnesota, and (b) the acquisition and improvement of a radio
broadcast license, and of a leasehold interest in land, an 800-foot radio tower, radio
transmission equipment, and a building located at 17979 Annette Avenue in Empire
Township, Dakota County, Minnesota (collectively ffie "ProjecY').
2. The Bonds will be issued and secured by the terms of an Indenture of Trust
• (the "Indenture") between the Port Authority and Wells Fazgo Corporate Trust Services
(the "Trustee") and wiIl be payable primarily from draws made on an irrevocable letter of
credit (the "Letter of CrediY� issued by Allied Irish Bank (the "Credit Enhancer")
pursuant to an agreement (the "Letter of Credit AgreemenY') between MPR and the
Credit Enhancer. The proceeds of the Bonds will be disbursed under the Indenture
pursuant to inshuctions from the Credit Enhancer.
3. MPR and the Port Authority will also enter into a Loan Agreement (the
"L.oan AgreemenY') in which MPR will agree to maintain the Letter of Credit and make
all payments due either to the Credit Enhaucer or on account of the Bonds.
4• The Port Authority has been advised by MPR that the economic feasibility
of operating the Project would be significantly reduced without the proposed revenue
bond financing, and that it has been acting to date in anricipation of the availability of ta7c
exempt financing for the Project.
5. The Port Authority desires to: promote the general welfaze of the City of
Saint Paul and the metro east community; enhance the image and reputation of the City of
Saint Paul (the "Cit}�') and meiso east community; and reduce the cost of bonowing for
the Project, and the issuance of the Bonds to refinance the Project will assist in achieving
those objectives.
• 6. The Port Authority's Credit Committee has given its approval to the
proposed issuance of the Bonds.
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• 7. Pursuant to the requirements of Section 147(fl of the Intemal Revenue
Code of 1986, as amended, and pursuant to a notice published by the Port Authority not
less than 15 days prior to the public hearing, a pubIic hearing was held on August 23,
2005 on the issuance of the Bonds, at which public hearing all persons were given an
oppomwity to speak.
8. The Bonds and the interest on the Bonds shall be payable solely from tfie
revenue pledged therefor and the Bonds shall not consfitute a debt of the Port Authority
within the meaning of any constitutional or statutory limitation of indebtedness, nor shall
the Bonds constitute nor �ve rise to a pecuniary liability' of the Port Authority or the City
or a charge against their general credit or taxing powers and sha11 not constitute a charge,
lien or encumbrance, legal or equitable, upon any property of the Port Authority or the
City other than their interest in said Proj ect.
9. It is intended that interest on the Bonds be excluded from gross incame of
the holders thereof for federal income tas purposes.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF
CONII��IISSIONERS OF THE PORT AUTHORITY OF THE CTTY OP SAINT PAUL,
AS FOLLOWS:
• A. On the basis of inforxnation available to fhe Port Authority it appears, and
the Port Authority hereby finds, that: the Project constitutes properties, used ox useful in
connection with one or more revenue producing enterprises engaged in any business
within the meaning of the Minnesota Statutes, Chapter 469 (the "Act"); the Project
fiirthers the purposes stated in the Act; and it is in the best interests of the port dishict and
the people of the City of Saint Paul, Minnesota and in fiutherance of the general plan of
development to assist MPR in financing the Proj ect.
B. For the purpose of financing the Project, and paying certain costs of
issuance and other expenses in connection with the issuance of the Bonds, and provided
that the Project and its financing receive approval by the Department of Employment and
Economic Development ("DEED'�, the Port Authority hereby authorizes the issuance,
saie and delivery of the Bonds in an aggregate principal amount of approximately
$12,500,000. The Bonds sha11 be in such principal amounts, bear interest at such zates,
mature, and be subject to redemption prior to maturity as shall be de�ernuned by the
President and the Chief Financial O�cer of the Port Authority and Bond Counsel. The
Bonds shall be numbered, shall be dated, and shall be in such form and have such other
details and provisions as may be prescribed in the Indenture, substantially in the form
now on file in the offices of the Port Authority.
C. Neither the Bonds, nor tfie interest thereon, sha11 constitute an
• indebtedness of the Port Authority or the City within the meaning of any constitutional or
statutory debt limitation; nor shall they constitute or give rise to a pecuniary liability of
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• the City or the Port Authority or a charge against their general taYing powers and neither
the full faith and credit noz the general taYing powers of the City or the Port Authority is
piedged to the pa}mient of the Bonds or interest thereon.
D. Forms of the following documents have been submitted to the Port
Authority for review and/or approval in connection with the sale, issuance and delivery of
the Bonds:
1. Bond Purchase Agreement (the "Bond Purchase AgreemenY� to be
entered into between the Port Authority, MPR and Piper Jaffray & Co. (the
"Underwrite�"�;
2. the'Indenture;
3. the I,oan Agreement;
4. form of the Bonds;
5. the Official Statement to be used in marketing the Bonds (the
"Official Statement'�;
• 6. the Remarketing Agreement to be entered into by and between
Piper Jaffray & Co. (the "Remazkering Agent") and MPR (the "Remarketing
Agreements"); and
7. the Reimbursement Agreement, including a form of the Letter of
Credit.
(collectively, the "Documents").
E. It is hereby found, deternuned and declazed that:
1. The issuance and sale of the Bonds, the execution and defivery by
the Port Authority of the Documents, as applicable, and the perforniance of all
covenants and agreements of the Port Authority contained in the Documents, as
applicable, and of all other acts and things required under the Constitufion and
laws of the Sfate of Minnesota to make the Documents and the Bonds vaIid and
binding obligafions of the Port Authority in accordance with their terms, are
authorized by the Act;
2. It is desirable that the Bonds be issued by the Port Authority upon
the general terms set forth in the Documents, as applicable;
• 3. Under the provisions of and as provided in the Documents, the
Bonds are not to be payable from ar a charge upon any funds other than the
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• revenues pledged to the payment thereof; no holder of the Bonds shall ever have
the right to compel any exercise by the City or fhe Port Authority of its taxing
powers to pay the Bonds or the interest or premium thereon, or to enforce
paym�nt thereof against any property of the City or the Port Authority except the
interests of the Port Authority and the City which have been pledged to the
Trustee under the Indentvre; the Bonds shall not constitute a charge, lien or
encumbrance, legal or equitable, upon any property of the City or the Port
Authority except the interests of the Port Authority and the City which have been
pledged to the Trustee under the Indenture; the Bonds shaIl each recite that they
are payable, including interest thereon, solely from the revenues pledged to the
payment thereof; and the Bonds shall not constitute a debt of the City or the Port
Authority within the meaning of any constitutional or statutory limitation.
F. The forms of the Documents and exhibits thereto are approved
substantially in the forms subxnitted and on file in the offices of Port Authority, with such
subsequent changes as may be approved by Port Authority management and Bond
Counsel as contemplated by paragraphs B and H. The Chair and Secretary of the Port
Authority, or such other of5cer as may be appropriate in the absence of either the Chair or
Secretary, are hereby authorized to execute the Documents (to the extent the Port
Authority is a pariy thereeo) in substantially the forms submitted, as modified pursuant to
pazagraphs B and A, and any other documents and certificates which in the opinion of
• Port Authority management and Bond Counsel aze necessary to the transaction herein
described The execution of any instrument by the appropriate officer or officers of the
Port Authority herein authorized shall be conclusive evidence of the approval of such
documents in accordance with the terms hereof. The execution of any documents
necessary for the transaction herein described by individuals who were at the time of
execution thereof the authorized officers of the Port Authority shall bind the Port
Authority, notwithstanding that such individuals .or any of them has ceased to hold such
office or offices prior to the authenricarion and delivery of the Bonds. Copies of all of the
documents necessary to the transacrion described shall be delivered, filed and recorded as
provided herein and in the Indenture.
G. The President and other officers of the Port Authority are authorized and
directed to prepare and fumish to the Underwrifer and Bond Counsel certified copies of
proceedings and recards of the Port Authority relating to the issuance of the Bonds and
other transactions herein contemplated, and such other affidavits and certificates as may
be required to show the facts relating to the legality of the Bonds and the other
transacrions herein contemplated as such facts appear from the books and records in the
officers' custody and conlroI or as otherwise known to them; and all such certified copies,
certificates and affidavits, inciuding any heretofore furnished, shall consfitute
representations of the Port Authority as to the truth of all statements contained therein.
H. The approval hereby given to the various Documents referred to above
• includes approval of such additional details therein as may be necessary and appropriate,
and such modifications thereof, deletions therefrom and additions thereto as may be
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• necessary and appropriate and approved by tfle Port Authority's President and Chief
Financial Officer, and includes approval of, among other things:
1. the interest rate or rates to be borne by the Bonds;
2. the establishment of the maturity schednle and call provisions to be
applicable to the Bonds; and
3_ such zelated inshuments as may be required to satisfy the conditions of
any purchaser of the Bonds.
I. T'he Port Authority hereby consents to the distribution of the Official
Statement, as such Official Statement is finalized with the participation of Port Authority
management and Bond Counsel. The proposal of the Underwriter to purchase the Bonds
upon the terms and conditions set forth in the Bond Purchase Agreements is hereby found
and deterniiued to be reasonable and hereby accepted.
J. The authoriry to approve, execute and deliver future amendments to
financing documents entered into by the Port Authority in connection with the issuance of
the Bonds and the other transacfions herein contemplated, is hereby delegated to the
President of the Port Authority, provided that: (a) such amendments do not require the
• consent of the Credit Enhancer or the holders of the Bonds ar if required, such consent
has been obtained; (b) such amendments do not materially adversely affect the interests of
the Port Authority as the issuer of the Bonds; (c) such amendments do not contravene or
violate any policy of the Port Authority; and (d) such amendments aze acceptable in form
and substance to Bond Counsel. T'he exeeution of any instrument by the President of the
Port Authority sha11 be conclusive evidence of the approval of such instruments in
accordance with the terms hereof.
K. No covenant, stipulation, obligation or agreement contained herein or in
the Documents shall be deemed to be a covenant, stipulation, obligation or agreement of
any member of the Board of Commissioners of the Port Authority, or any officer, agent or
employee of the Port AuYhority in that persons individual capacity, and neither the Boazd
of Commissioners nor any officer executing the Bonds shall be liable personally on the
Bonds or be subject to any personal liability or accountability by reason of the issuance
thereof.
•
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. L. The actions of Port Authority management in causing the publication of
the notice of public hearing, and in the prepatation of the Documents, are hereby ratified
and confumed.
Adopted: September 27, 2005
PORT AiJTHORITY OF TE� CITX
OF SAII�IT PAUL
�
Its Chair
ATTEST:
By
Its Secretary
C�
•
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