05-919Council F51e # �q��
Presented
Referred To
Green Sheet # � o a�a��
RESOLUTION
OF SAINT PAUL, MINNESOTA ,�
Committee Date
City Council Resolution
[Memorial Blood Centers]
WFIEREAS:
1. The Port Authority of the City of Saint Paul (the "Port Authorit}�') t�as given its approval to the
issuance of its Vaziable Rate Revenue Bonds (Ivlemorial Blood Centecs Project) Series 2005-7 (the `Bonds") inthe
aggregate principal anwunt of $6,000,000. The proceeds ofthe Bonds will be loaned to Memorial Blood Centers,
a Minnesota nonprofit corporafion ("Memorial Blood Centers") for its use in fmancing a project consisting of
the acquisirion and renovation of a building located at 727 Pelham Boulevazd in Saint Paul, Minnesota (the
"City") for use as a collecrion and dishibution faciliry, as well as for management offices (collectively the
"ProjecP').
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2. I,aws ofMinnesota 1976, Chapter 234, provides that any issue ofrevenue bonds authorized by
the Port Authority shallbe issued only withthe consent of the City Councff ofthe City of Saint Paul, by iesolurion
adopted in accordance with law.
3. ApprovaloftheissuanceoftheproposedBondsbytheCityCouncilisalsorequiredbySection
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 Council gives its requisite approval to the issuance of ffie proposed Bonds by the Port Authority,
subject to final appxoval of the details of said Bonds by the Port Authority.
NOW, TT3EREFORE, BE IT RESOLVED by the CouncIl ofthe Ciry of Saint Paul that, in accordance
with the requirements of Section 147(� of the Internal Revenue Code of 1986, as amended, and in accordance wixh
Laws of Minnesota 1976, Chapter 234, the City Council hereby approves the issuance of the aforesaid Bonds by
the Port Authority for the pucposes described in the Port Auffiority resolution adopted September 27, 2005, the
exact details of which, including but not limited to, provisions relating to principal aznount, maturities, interest
rates, discount, redemption, and the issuance of additional bonds aze to be detemrined by the Port Authority, and
the City Councff heieby authorizes the issuance of any additional bonds (including iefunding bonds) by the Port
Authoriry found by the Port Authority to be necessary for carrying out the purposes for wluch the aforedescribed
Bonds are issued.
Adopted: October � 2005
35088.v1
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Yeas Nays Absent
Benanav ✓
Bostrom ✓
Harris ✓
Helgen ✓
��, �
Montgomery ✓
Thune i/
Ado�
Ado�
By:
App�
By:
Form Approved by City Attomey
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Reouested bv Deoartment of: .
� Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet �
PA — POrtAUrhonry
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��-05 Green Sheet NO: 3028217
� 0
Assign 1
Number Z
Fd
Routin9 3
Oraer I a
� 5
Contact Person & phorre:
Pete qem
Y243686
OS-OCT-0S
Total # of SignaWre Pages _(Clip All Loeations for Signature)
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lanni & Ecoe evtl renm[ 'r _ c�t
�.ee I Ma
Coundl I I
Appioval of the issuaqce of approximately $5,010,000 of 501(c) (S) conduit taz exempt bonds for the pischase of Memorial Biood
Centers' headquarteis and dis�bution cente� iocated az 727 Pelham BLvd.
_ Planning Commission
_ CIB Committee
_ Civii Sernce Commission
�
7. Has ihis persoNfirtn ever worked under a conhact for Mis deparlmeM?
Yes No
2. Has thi5 person/firm ever been a city empioyee?
Yes No
3. Does ihis persoNfirtn possess a 5kii1 not nortnally possessed by any
cufrent aty employee?
Yes Na
Explain ail yes answare on separate sheet antl attach to graen sheet
Initiating Problam, Issues, Opportunity (Who, What, When, Where, Why):
Memoriai Blood Centers has outgcown i1s Minneapolis faciliTy and it needs a more cenhal locarion
AtivantaAe5lFApproved:
The issuance of the bonds wil] aliow Memorial Blood Centers to improve the collection and dishabution of blood sernces provided to
Saint Paul ruidents and bring 240 jobs m St. Paul.
Disativanqpes If Approvetl:
None
DisativanqAes If Not Approved:
The collechon and dsifriburion of life saving blood m St. Paul will be less efficient.
V�7mnsaction: 5010000 CosHRevenueBUdgeted:
Funtltng Souree: pOf[ AUthOnly 501(C)(3) AeGViry N�mber.
Financjal Information: conduit t2x exempt
(EZplain) bonds
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s�rPAr�
PORTA�17'HOR�TY
rur: u�� r : .] 7r`ii1
TO: Board of Commissioners DA'I'E: Sept. 21, 2005
(Meeting of September 27, 2005)
FROM: Peter M. Klein �
Laurie J. Hansen
Kenneth R. Joh o
SUBJECT: MEMORIAL BLOOD CENTERS
AUTHORIZATION FOR AN APPROXIMATE $5,010,000 501(c)(3)
CONDUIT TAX EXEMPT BOND ISSUE
PUBLIC HEARING
RESOLUTION NO. 4148
ACTfON REQUESTED
Approval for the issuance of approximately $5,010,000 of 501{c)(3) conduit tax exempt
bonds for Memorial Blood Centers (MBC).
PUBLIC PURPOSE
Bond proceeds will provide funding necessary for MBC to more efficiently collect and
distribute blood supplies.
BUSINESS SUBSIDY
The proposed issuance of bonds is for a not-for-profit organization and is exempt from
treatment as a business subsidy.
BACKGROUND
MSC is moving its headquarters, and approximately 240 empioyees, from Minneapolis to
Saint Paul. The new headquarters wili be at 727 Pelham Boulevard, a building located
within the Twin City Testing tax increment district and which was previously financed by the
Port Authority. Attached is a report out{ining the terms of the ta�c exempt bond issue.
POLICY EXCEPTIONS
There are not any exceptions.
WORKFORCE IMPLICATIONS
MBC will bring approximately 240 jobs to Saint Paul.
DISCLdSURE
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.
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Action Reauested:
Proiect Summarv:
Tvpe:
Term
Interest Rate:
Issuer
Borrower
Underwriter
Borrowers Counsel:
Underwriter's
Counsel
Bond Counsel
MEMORIAL BLOOD CENTERS
Approval of the issuance of an approximate $5,Q1 �,000
conduit tax exempt bond issue for Memoriai Blood
Centers.
Series 2005-8 - $4,500,000
Series 2005-9 - $510,000
Fixed limited offering ($100,000 minimum) bonds
Series 2005-8 - 15 years
Series 2005-9 - 5 years
Series 2005-8 — approximately 5.00%
Series 2005-9 — approximately 3.40%
Saint Paul Port Authority
Memorial Blood Centers
Wells Fargo Brokerage Services, LLC
Gray Plant Mooty Mooty & Bennett, P.A.
Dorsey & Whitney, LLP
Leonard Street & Deinard
The Companv: During World War ii, the need for a coordinated system
to receive, store and distribute blood became obvious.
To fill that need, several sponsoring organizations
founded the Minneapolis War Memorial Blood Bank in
1948.
Memorial Slood Centers is a nationaffy known, locally
operated, non-profit community blood center that serves
36 hospitals in the Twin Cities metro area, northem
Minnesota and northwestern Wisconsin.
The Proiect: The Bond proceeds will be loaned to the borrower and
used to purchase and improve a bui{ding at 727 Pelham
Boulevard. This property has a recorded lien requiring
the payment of taxes through the end of the Twin City
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Testing TIF District and MBC wiil assume this recorded
4ien and can choose to either continue to make semi-
annual payments or to make a lump sum payment to
pay off the associated outstanding debt.
Estimated Sources
And Uses of Funds:
Sources of Funds
Bond Proceeds
Use of Funds
Purchase of Building
Renovation of Building
$ 5..010.000
$ 4,500,000
510,000
Total
$ 5.010.000
Fees: The Port Authority will receive a fee of ten basis points
annually on the outstanding principal beginning in the
second year.
Conduit Financinq: The bonds will be a conduit financing of the Authority
and will 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.
Recommendation: We recommend approval of authorizing the issuance of
approximately $5,010,000 of conduit bonds on behalf of
Memoria{ Blood Centers.
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Resolurion No. 414 8
RESOLUTTON OF THE
PORT AUTAORITY OF THE CITY OR SAINT PAUL
li� '1 : ��.yi
1. It has been proposed that the Port Authority of the City of Saint Paul (the
"Port Authorit}�') issue one or more Commercial Revenue Notes (collectively the `2Vote")
in an aggregate principal amount of up to approximately $b,000,000 and tkat the proceeds
of such Note be loaned to Memorial Blood Centers, a Minnesota nonprofit corporation
("Memorial Blood Centers") for its use in financing a project consisting of the acquisition
and renovarion of a building located at 727 Pelham Boulevard in Saint Paul, Mimiesota
(the "Cit}�') for use as a collection and distribution facility, as weil as for management
offices (collectively the "Project").
2. The Note will be issued and secured by the terms of a Loan Agreement
(the "Loan AgreemenY') between the Port Authority and Memorial Blood Centers, and
sold to Wells Fargo Brokerage Services, LLC (the "Lender"}. Memorial Blood Centers
will agree to repay the Note in specified amounts and at specified times sufficient to pay
in fuil when due the principal of, premiuxn, if any, and interest on the Note. In addifion,
the Loan Agreement will contain provisions relating to the maintenance and operation of
the Project, indexnnification, insurance and other agreements and covenants which are
required or permitted by the Act and which the Port Authority, Memorial Blood Centers
and the Lender deem necessary or desirable for the financing of the Project.
3. The Port Authority has been advised by Memoriai Blood Centers 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 anticipation of the
auailability of tax exempt financing for tl�e Project.
4. The Port Authority desires to: promote the general welfare of the City and
the metro east community; enhance the image and reputation of the City and metro east
community; provide health care facilities needed in the City and reduce the cost of
bonowing far the Project, and the issuance of the Note to finance the Project will assist in
achieving those objectives.
5. The Port Authority's Credit Committee has given its approval to the
proposed issuance of the Note.
6. Pursuant to the requirements of Section 147(f� of the Internal Revenue
Code of 1986, as amended, and pursuant to a norice published by the Port Authoriry not
less than 15 days prior to the public hearing, a public hearing was heid on September 27,
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2005 on the issuance of the Note, at which public hearing all persons were given an
opportunity to speak.
7. The Note and the interest on the Note shall be payable solely from the
revenue pledged therefor and the Note shall not constitute a debt of the Port Authority
within the meaning of any constitutional or statutory limitation of indebtedness, nor sha11
the Note consritute nor �ve rise to a pecuniary liability of the Port Authority or the City
or a charge against their general credit or taYing powers and shall not constitute a chazge,
lien or encumbrance, legal or equitable, upon any properiy of the Port Authority or the
City other than their interest in said Project.
8. It is intended that interest on the Note be excluded from gross income of
the holders thereof for federal income tax purposes.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF
COMMISSIONERS OF TIIE PORT AUTHORTTY OF THE CITY OF SAINT PAUL,
AS FOLLOWS:
I. Generai Authorization
A. On the basis of informafion available to the Port Authority it appears, and
the Port Authority hereby finds, that: the Project constitutes properties, used or useful in
connection with one or more revenue producing entexprises engaged in any business
within the meaning of the Minnesota Statutes, Chapter 469 (the "AcY'); the Project
fiirthers the purposes stated in the Act; and it is in the best interests of the port district and
the people of the City of Saint Paul, Minnesota and in fiu of the general plan of
development to assist Memorial Blood Centers in financing the Project.
B. For the purpose of fmancing the Project, and paying certain costs of
issuance and other expenses in connection with the issuance of the Note, and provided
that the Project and its financing receive approval by the Departsnent of Employment and
Economic Development ("DEED"), the Port Authority hereby authorizes the issuance,
sale and delivery of the Note in an aggregate principal amount of approximately
$6,000,000 to the Lender. The Note shall be in such principal amount, bear interest at
such rate, mature, and be subject to redemption grior to mahxrity as shall be detemiined
by the President and the Chief Financial Officer of the Port Authority and Bond Counsel.
C. Neither the Note, nor the interest thereon, sha11 constitute an indebtedness
of the Port Authority ar the City within the meaning of any cons6tutional or statutory debt
limitarion; nor shall they constitute or give rise to a pecuniary liability of the City or the
Port Authority or a charge against their general tasing powers and neither the full faith
and credit nor the general taxing powers of the City or the Port Authority is pledged to the
payment of the Note or interest thereon.
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D. Forms of the following documents have been submitted to the Port
Authority for review and/or approval in connecrion with the sale, issuance and delivery of
the Note:
1. the L,oan Agreement;
2. the £orm of the Note;
3. a Pledge Agreement (the "Pledge AgreemenY') to be entered into
between the Port Authority and Lender, pursuant to which the Port Authority will
pledge and grant a security interest in all of its right, title and interest in the Loan
Agreement to the Lender (except for certaiu rights of indemnification and to
reimbursement for certain costs and expenses);
4. a Mortgage, Security Agreement, Assignment of Leases and Rents
and Fixture Financing Statement (the "Mortgage") to be executed by Memorial
Blood Centers in favar of the Lender, pursuant to which Memorial Blood Centers
will secure payment of amounts due under the Loan Agreement and Note by
granting to the Lender a mortgage and security interest in the property described
therein; and
5. a Disbursing Agreement (the "Disbursing AgreemenY') to be
entered into between Memorial, the Lender and a ritle insurance company
acceptable to the Lender.
(collectively, the "Documents").
E. It is hereby found, detennined and declared that:
1. The issuance and sale of the Note, the execution and delivery by
the Port Authority of the Documents, as applicable, and the performance 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 Constitution and
laws of the State of Minnesota to make the Documents and the Note valid and
binding obligations of the Port Authority in accordance with theiz terms, are
authorized by the Act;
2. It is desirable that the Note be issued by the Port Authority upon
the general terms set forth in the Documents, as applicable;
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3. Under the provisions of and as provided in the Documents, the
I�iote is not to be payable from or a chazge upon any funds other than the revenues
pledged to the payment thereof; no holder of the Note shall ever have the right to
compel any exercise by the City or the Port Authority of its t�ing powers to pay
the Note or the interest or premium thereon, or to enforce payment thereof against
any properry of the City or the Port Authority except the interests of the Port
Authority and the City which have been pledged to the payment thereof by the
Documents; the Note shall not constihxte a chazge, 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 payment
thereof by the Documents; the Note shall recite that it is payable, including
interest thereon, solely from the revenues pledged to the payxnent thereof; and the
Note shall not constitute a debt of the City or the Port Authority within the
meaning of any constitutional or statutory limita6on.
F. The forms of the Documents and exhibits thereto are approved
substantially in the forms submitted 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 officer 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 thereto) in substantially the forms submitted, as modified pursuant to
paragraphs B and H, 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 execufion of any instrument by the appropriate officer or officers of the
Port Authority herein authorized shall be conclusive evidence of the approval of such
docuxnents in accordance with the terms hereof. The execurion of any documents
necessary for the transacfion herein described by individuals who were at the time of
execution thereof the authorized officers of the Port Authority shatl bind the Port
Authority, notwithstanding that such individuals or any of them has ceased to hold such
office or offices prior to the authentication and delivery of the Note. Copies of all of the
documents necessary to the transaction described shall be delivered, filed and recorded as
provided herein and in the Loan Agreement.
G. The President and other officers of the Port Authority are authorized and
directed to prepaze and fiunish to the Lender and Bond Counsel certified copies of
proceedings and records of the Port Authority relating to the issuance of the Note and
ofl�er transactions herein contemplated, and such other affidavits and certificates as may
be required to show the facts relating to the legality of the Note and the other transactions
herein contemplated as such facts appear from the books and records in the officers'
custody and controi or as otherwise known to them; and all such certified copies,
certificates and affidavits, including any heretofore furnished, shall constitute
representations of the Port Authority as to the truth of all statements contained therein.
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H. The approval hereby given to the various Documents referred to above
includes approval of such addiuonal details therein as may be necessary and appropriate,
and such modifications thereof, deletions therefrom and additions thereto as may be
necessary and appropriate and approved by the Port Authority's President and Chief
Financial Officer; and includes approval of, among other things:
l. the finai principal amount of the Note, provided that such principal
amount shall not exceed $6,000,000;
2. the interest rate or rates to be bome by the Note provided that the
maximum annual interest rate shall be 6%;
3. the establishment of the maturity schedule and call provisions to be
applicable to the Note provided that the final maturity of the Note shail not be
later than December 31, 2020; and
4. such related instruments as may be required to sarisfy the conditions of
the Lender.
I. The Port Authority aclrnowledges that the Lender may grant participation
interests in the Note to other fmancial insritutions in principal amounts of at least
$100,000.
II. The Note
J. Before delivery of the Note, there shall be filed with the Lender (except to
the extent waived by the I,ender) the following items:
(a) an executed copy of each of the following docutnents:
(1) theI.oanAgreement;
(2) the Pledge Agreement;
(3) the Mortgage;
(b) an opuuon of counsel for Memorial Blood Centers as prescribed by
the Lender and Bond Counsel;
(c) the opiruon of Bond Counsel as to the validity and taac-exempt status
of the Note;
(d) such other documents and opinions as Bond Counsel may reasonably
require for purposes of rendering its opinion required in (c) above or that the
L,ender may reasonably require for closing.
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K. The Port Authority wi11 cause to be kept at the offices of the Port
Authority a Note Register in which, subject to such reasonable rea lations as it may
prescribe, the Port Authority shall provide for the regish of transfers of ownership of
the Note. The Note shall be initially registered in the name of the Lender and shall be
transferable upon the Note Register by the L,ender in person or by its agent duly
authorized in writing, upon surrender of the Note together with a written instriunent of
transfer satisfactory to the Port Authority, duly executed by the L,ender or its duly
authorized agent. The Port Authority may require, as a precondition to any transfer, that
the transferee provide evidence to the Port Authority that the transferee is a financial
institution or other accredited investor under the securities laws. The following form of
assigunent shall be sufficient for said purpose.
For value received hereby sells, assigns and transfers unto
the attached Note of the Port Authority of the Ciry of
Saint Paul, and does hereby irrevocably constitute and appoint
attomey to hansfer said Note on the Books of said Port
Authority, with full power of subsriturion in the premises. The undersigned certifies that
the transfer is made in accordance with Section 2.8 of the Resolurion authorizing the
issuance of the Note.
Registerea owaer
Upon such transfer the Port Authority sha11 note the date of registration and the name and
address of the new Lender in the Note Register and in the registration blank appearing on
the Note.
L. In case the Note sha11 become mutilated or be destroyed or lost, the Port
Authority shall, if not then prohibited by law, cause to be executed and delivered a new
Note of like outstanding principal amount, number and tenor in exchange and substitution
for and upon cancellation of such mutilated Note, or in lieu of and in subsritution for such
Note desiroyed or lost, upon the Lender's paying the reasonable expenses and charges of
the Port Authority in connection therewith, and in the case of a Note destroyed or lost, the
filing with the Port Authority of evidence satisfactory to the Port Authority with
indexnnity satisfactory to it. If the mutilated, destroyed or lost Note has already matured
or been called for redemption in accordance with its terms it shall not be necessary to
issue a new Note prior to payment.
M. The Port Authority may deem and treat the person in whose name the Note
is last registered in the Note Register and by notation on the Note, whether or not the
Note shall be overdue, as the absolute owner of the Note for the purpose of receiving
payment of or on account of the principal balance, redemption price or interest and for all
other purposes whatsoever, and the Port Authority shall not be affected by any notice to
the contrary.
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N. The Note will be issued without being registered under state or other
securiries laws, pursuant to an exemption for such issuance; and accordingly the Note
may not be assigned or transferred in whole ar in part, nor may a participarion interest in
the Note be given pursuant to any participarion agreement, except as an exempt security
or as an exempt transaction.
III. Miscellaneous
O. The authority to approve, execute and deliver future amendments to
finaucing documents entered into by the Port Authority in connection with the issuance of
the Note and the other transactions herein contemplated, is hereby delegated to the
President of the Port Authority, provided that: (a) such amendments do not require the
consent of the Lender or if required, such consent has been obtained; (b) such
amendments do not materiaily adversely affect the interests of the Port Authority as the
issuer of the Note; (c) such amendments do not contravene or violate any policy of the
Port Authority; and (d) such amendments are acceptable in form and substance to Bond
Counsel. The execution of any instrwnent by the President of the Port Authority shall be
conclusive evidence of the approval of such inshuments in accordance with the terms
hereof.
P. 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 Authority in that persons individual capacity, and neither the Board
of Commissioners nor any officer executing the Note shall be liable personally on the
Note or be subject to any personal liability or accountabiliry by reason of the issuance
thereof.
Q. If any provision of this Resolution shall be held or deemed to be or shall,
in fact, be inoperative or unenforceable as applied in any particular case in any
jurisdiction or }urisdicfions or in all jurisdictions or in all cases because it conflicts with
any provisions of any constitution or statute or rule or public policy, ar for any other
reason, such circumstances sha11 not have the effect of rendering the provision in question
inoperative or unenforceable in any other case or circumstance, or of rendering any other
provision or provisions contained herein invalid, inoperative, or unenforceable to any
extent whatever. The invalidity of any one or mare phrases, sentences, clauses or
paragraphs contained in this Resolution shall not affect the remaining portions of this
Resolution or any part thereof.
R. The Note does not qualify as a"qualified tax-exempt obligation" within
the meaning of Section 265(b)(3) of the Code.
S. The actions of Port Authority management in causing the publicarion of
the notice of public hearing, and in the preparation of the Documents, are hereby ratified
and confirmed.
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Adopted: September 27, 2005
ATTEST:
By
Its Secretary
PORT AUTHORITY OF THE CTTY
OF SAINT PAUL
Its Chair
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