06-127Council File # �}.' `Z,�
Green Sheet # 3029552
ci�r
Presented by
RESOLUTION
NT PAUL, MINNESOTA
APPROVAL OF AN INTERNAL LOAN,
A SPECIAL Fi IND AGREEMENT
WITH SAIlVT PAUL HOUSING AND REDEVELOPMENT AUTHORITY
FOR WEST MIDWAY TAX INCREMENT FINANCING DISTRICT
AND BUDGET AMENDMENT
10
9 W��AS, in December 2005, as part of the deliberations on the 2006 budget, the City Council
10 Budget Committee discussed and decided that $2,400,000 should be retumed to Ramsey County, which
11 sum represents excess tax increment from the West Midway Tax Increment Financing Dishict ("TIF
12 Obligation"); and
13 -
14 W��AS, the agreed-upon funding option to pay the TIF Obligation is set forth in Attachment A
15 to this Resolution and that funding is from the City's Internal Borrowing Fund 070; and
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
W�REas, the City is willing to enter into a Special Fund Agreement ("AgreemenY') with the
Housing and Redevelopment Authority of the City of Saint Paul, Minnesota ("Authorit}�') which will
memorialize the mutual understanding of the City and Authority with respect to the transaction; and
WHE�ns, the repayment source for this loan, proceeds from the Science Museum of Minnesota
Promissory Note dated March 14, 2000, executed by the Science Museum in the original principal amount
of $5,000,000, and amended by a First Amendment dated December 20, 2001 ("SM Note") has been
reviewed by the City's Credit Committee and been assigned a risk rating of Acceptable.
NOw, T��FOxE, BE TT RESOLVED, the City Council approves the use of the Internal Borrowing
Fund 070 to lend cash from various city funds as allowed by law; and
FUR'�Ex RESOLVED, that all loans created by the Intemal Borrowing Fund must first be approved
by City Council Resolution; and
FtJR'['xEx RESOLVED, the City Council hereby approves the Agreement substantially in the form
submitted and authorizes and directs the appropriate city officials to execute the same on behalf of the City
and fiuther authorizes the Director of the Office of Financial Services to negotiate changes to the
Agreement that do not substantially change the City's obligations thereunder; and be it
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
APPROVAL OF AN INTERNAL LAAN, R SPECIAL FUND AGREEMENT
WITH SAINT PAUL HOUSING AND REDEVEIAPMENT AUTHOR[7Y
FOR WEST MIDWAY TAX INCREMENT FINANCING DISTRICT AND BUDGET AMENDMEN7
(PAGE 1W0)
p(�' i"L'I
FINai.LY RESOLVED, the Mayor, pursuant to Sec. 10.07.01 of the City Charter, recommends the
following changes to the 2006 budget:
FIDrarrCirrG PLaN: Internal Borrowing Fund
GL 070 10303 6928 Advance from Other Funds
GL 070 10303 6604 Interest on Advance
All Other Fund Financing
SPENDING PLn1v: Internal Bonowing Fund
GL 070 10303 0519 Purchase SM Note
GL 070 10303 0619 Interest Expense
All Other Fund Spending
Bostrom
Hazris
Adopted by Council: Date
Yeas
✓
✓
I
✓
Current Amended
Bud�et ChanQes Bud�et
0 2,400,000 2,400,000
0 95,000 95,000
0 0 0
0 2.495.000 2.495,000
1
1
2,400,000
95,000
0
2,495.000
2,400,000
95,000
0
2 495 000
Absen�l Requested by Department of:
Office of Financial Services
By:
� ��
Form Approved by City Attomey
By: � is� bP. ��j
Adoption Ceriified by Council Secretary v
g � Form " ov by ayox fo �� u mi i n to ouncil
Approve Mayc� Date Z�/�j�(�(P By:
T
BY:
i
� Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet �
FS – Financial sen;ces
Contact Person & Phone:
Aiexandra Oieary
266-8832
must Be on Council Agem
o�,j08/o6
ContractType:
RE-RESOLUTION
Date fnitiated: �� !Z�
3�-.,�-� Green Sheet NO: 3029552
-' Deoartrnent SentToPerson InitiaUDate
0 aat
Assign 1 'nan' rvices De entDi ec[or
Number Z . Atcorne �
For
RouGng 3 'sO�ce Ma or/Assistant
Order 4 omu7
5 i Cler ' Q
Toql # of Signature Pages _(Ciip All Locations for Signature)
Signalures on the attached resoYupon approving an internal loan/special fund agreement and budget amendmen[ with Saint Paul
Housing and Redevelopment Authority for West Midway Tae Increment Financing District.
idations: Appro�e (A) or F
Planning Commission
CIB Committee
Citil Service Commission
(R):
Service
'I. Has this person/firm e�er worked under a contract for this depaAment?
Yes No
2. Has this person/firtn e�er 6een a city employee?
Yes No
3. Dces this person/firm possess a skill not normally possessed by any
current city employee?
Yes No
Explain all yes answers on separate sheet and attach ta green sheet
Following
� Initiating Problem, lssues; Opportunity (Who, What, When, Where, Why):
The City of Saint Paul needs to return excess Tax Incremencs from the West Midway TIF District to Ramsey County.
AdvanWges IfApproved:
The funds will be transfeaed as required.
Disadvanpges IfApprovedr
None.
Disadvantages tf Not Approved:
The funds will not be transferred.
�uca�s�mountot $2400,000
Transaction:
Fundin5� Source:
Financial Information:
(Explain)
CostlRevenueBudgeted: Y
Activity Number:
January 39, 2006 9:44 AM Page 1
City of Saint Paul
Office of Financial Service - Treasury Section
West Midway TIF/Science Museum Note Cash Flow Analysis
Estimated Intemal Loan Repayment (070-10303)
Be innin Loan Outstandin 1/1/2006 $ 2,400,000
Date
Febivary t, 2006 5
MarU'I, 2006 5
ApnIt,2WG 5
May t, 2006 5
June1,2006 5
July1,2006 5
Augustt,200G S
Septembert,2006 5
Octobert,2006 5
Novem�e�1,2006 5
Decembert,200G 5
January1,200] 5
February1,200] 5
March 1, 200] 5
Apnl 1, 2001 5
May 1, 200� 5
June 1, 200� 5
July 1, 200� 5
August1,200] 5
September1,200� 5
OQOber1,20W $
November t, 2007 $
December 1, 2007 $
January 1, 2008 $
Febtuary1,2008 $
March 1, 2008 $
APn11.2008 $
May 1, 2008 S
June 1, 2008 $
July 1, 2008 5
August1,2006 5
September1,2006 5
Odober 1, 2008 5
November1,2008 5
�ecember1,2�08 $
January 1, 20�9 g
Febniary 1, 2009 $
March 1. 2009 $
Apn11,2009 $
May �, 20�9 $
June �, 2009 $
Juiy 1. 2009 $
Augus[1,2009 $
Seplember1,2009 5
October1,2009 5
November i, 2009 5
Decembe�1,2009 $
January 1, 2010 $
Febniary �, 2010 $
March 1, 2010 $
ApnIt,2010 $
May �, 2010 $
June i, 2010 $
July'I, 2010 $
August1,2010 $
September t, 2010 S
October 1, 2010 $
November 1, 2010 $
December12010 5
Beginning � PayDOVm � AtltliVOnal HRA
2,389,080
2 378,115
2,36],103
2.356.046
2.344.443
2,333,]93
i.6d],]9]
1,558,743
1 544.3t8
101
662,1t6
4]8,955
460,030
441.a2]
421.944
ao2,7az
383,540
364,218
344,816
325,332
3�5,]68
286.122
266,396
81,583
6t,003
40,33�
20.833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
2�,833
20,833
2�.H33
20,833
20,633
20,633
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,833
20,633
20,633
20,833
20,633
�ecember3t,2012 $ - $ 250,000
December3�,2013 $ - 5 250,000
December3t.2014 $ - $ 250.000
December3t,2015 $ - $ 250,000
December31,2016 $ - $ 250,000
December31,2017 $ - $ 250,000
December3�,2018 $ - $ 250,0�0
December31.2019 $ - $ 250,000
December31,2020 b - $ 250,000
December31,2021 $ - $ 250,00p
5 -
5 -
5 -
5 -
5 6T2,000
5 -
5 -
5 -
5 -
5 -
S -
5 -
5 -
S
5 -
S -
5 -
5 -
$ -
$ -
$
$ -
$ -
8 -
$ -
$ -
S -
S -
5 -
5 -
5 -
5 -
5
5
$
$
$
$
$ -
$
$ -
$ -
$
$ -
5 -
S -
S -
5 -
3 -
5 -
5
5 -
$ -
$ -
$
S
S
5 �00,000 5 25,0�0
5 iso,000 S 25,000
$ '190,000 5 25,000
EXHIBITA
Nteresl � Entling I A�+mulabve � InterenEryenseon
9.868
9,822
9,T/6
9,�30
9,684
6,63]
6,A9
6,406
6,346
6.26]
6,22]
6,16G
6,105
6,044
5,982
5,920
5,858
5,]9G
5,]33
4.982
4.9�6
4,850
4,783
4,117
4,649
4,582
Q514
4,446
4,3�8
4,309
4.241
3,484
193
119
s �so,000 5 zs,aoo
S 190,000 $ 25,000
S (874�5) 5 162,525
S (e],4]5) 5 162,525
5 (8],4]5) 5 162,525
5 (8],4]5) S 162,525
5 (e],4]5) 5 162,525
5 (8],4]5) $ 162,525
5 (8],4]5) 5 162,525
5 (8],4]5) 5 162,525
1.187
1,1a5
1 023
253
16]
81
$ AOW.000 $ 6�20D0 51tM221) 859t27]3
' This is an eshmatetl rete The awtal interesl expense will be chargetl at "POOI Rate"
32.3�8,t15
52,36],t03
52.356,006
52.344.943
52,333,]93
5 t.64]79]
5 t 558,743
5 1,544,318
3 t 529,832
5 t,515,286
S t 500,680
51,466,012
5'I 4]1.284
5 �,456,494
5'I 441,643
51,G26,]30
5 1,411,]54
51,396,]16
S 1,2t6,616
51,2W,]65
5 1,184,848
$1.168.865
$1.�52.815
$ 1,136,698
$ 1.120.St4
$1.104.263
$1,08],944
$1,W 1,55]
$ 1,065,'10'I
$1,038,5�8
$ 856,985
$ 839,636
$ 822,2�4
$ 804,720
$ 787,152
$ 769,512
$ 751.798
$ ]34,011
$ ]i6,149
5 696,213
S 680,202
5 6G2,116
$ 478,955
5 460,030
$ 441.02]
$ 42t.944
$ 402,182
$ 383,540
$ 364,218
$ 344,816
$ 325,332
$ 305,�68
$ 286,122
$ 266,394
$ 81,583
$ 61,003
$ 40,33�
$ 19,585
mo,00a
100,41]
100,835
101.255
101,6T/
102.101
102,526
102,953
103,382
103,813
104.246
104,680
295,116
29G,346
29].581
298.821
300,066
301 316
302,5]1
303,632
305,098
3W,369
301,646
308,928
500,2t5
5�2 299
50d,392
506.494
5a8.6:14
5t0,�23
512,851
514,988
51].134
519,289
521,452
523,625
]15,80]
]18.]89
]21,]84
]24,�92
]2].812
130,844
733,689
�3G.941
an
416
420
422
424
425
42l
429
431
433
434
43G
1.230
1,235
1.240
1,245
1,250
1,255
1.261
1,266
1.2]1
9,2]]
�,282
1.28]
2,084
2,093
2.102
2.110
2.119
2.128
2.137
2.146
2.155
2,164
2.113
2.182
2.983
2.995
3,00�
3,020
3,033
3,045
3,058
3,0]1
3,083
3,096
3,109
3.122
3.92]
3,943
3,960
3,9]6
T Hutley 6-8837 wesMitlwayp65ciencemuseum intemal loan repay-0 xls 2l3/2006
o�- �z�
SPECIAL FUND AGREEMENT
(West Midway TIF/Science Museum Note)
Dated as ofJanuary 1, 2006
by and between
CITY OF SAINT PAUL, MINNESOTA
.�ii�il
HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF SAINT PAUL,
MINNESOTA
bt�-12`1
THIS SPECIAL FLTND AGREEMENT ("AgreemenY') is made and entered into by and
between the CITY OF SAINT PALTL, MINNESOTA, a home rule charter ciry and municipal
corporarion of the State of Minnesota (the "City") and the HOUSING AND REDEVELOPMENT
AUTHORITY OF THE CITY OF SAINTPALJL, MINNESOTA, apublic body corporate andpolific
of the State of Minnesota (the "Authorit}�') as of the 1�` day of January, 2006.
WHEREAS:
funds:
A. The City, acting through its Office of Financial Services, has created the following
(1) a special fiznd, designated in the financial records of the City as the Internal
Borrowing Fund, City Account #070 ("Fund 070"); and
(2) a general fund, designated in the financial records of the City as the General
Fund ("General Fund").
B. The Authority has created the following funds:
(1) a special fund for the West Midway Tax Increment Financing District
designated as Fund 148-76300 ("Fund 148"); and
(2) a general fund designated as Fund I 17 ("Fund 117").
C. The Authority staff and legal counsel have concluded that $2,400,000.00 needs to be
returned to Ramsey County under Minn Stat 469.176 as excess ta�c increment from the West Midway
Tax Increment District ("TIF Obligation'�.
D. The City is willing to transfer to the Authority from Fund 070 the sum of
$2,400,000.00 which the Authority will use to pay the TIF Obligation on the terms set forth in this
Agreement. The City is expecting that Fund 070 will be fully reimbursed far this amount from the
following three sources: payments to be made by The Science Museum ofMinnesota ("SM") under
the Promissory Note dated March 14, 2000 executed by SM in the original principal amount of
$5,000,000.00, as amended by a First Amendment dated December 2Q 2001("SM Note"), the City's
share of the tax payment to be distributed by Ramsey County, and advances from the Authority's
Loan ("Sources").
E. The City and Authority wish to memorialize their mutuai understanding relating to
the receipt of future payments from the SM Note.
F. By Resolution No. 06-01/25-� a copy of which is attached hereto, the Authority's
Board of Commissioners approved the execution of this Agreement and an amendment to the
Authority's budget to allow for the implementation of the financial transactions contained in this
Agreement.
G. By Resolution No.06- , a copy of which is attached hereto, the City Council of the
City approved the execution of this Agreement and an amendment to the City's budget to allow for
the implementation of the financial transaction contained in this Agreement.
U(�-�2�
H. The City and Authority wi sh to enter into this Agreement to provide for their mutual
understanding of the transaction involving the payment of the TIF' Obligation and the distribution
of future payments made under the SM Note.
NOW THEREFORE, in consideration of the mutual promises and agreements herein
contained, the receipt and sufficiency ofwhich consideration is hereby mutually acknowledged, the
City and the Authority agree as follows:
meanings:
Definitions. As used in tlus Agreement, the following terms shall have the following
(a) "Loan" means the principal sum of $86Q000.00 which the Authority has
agreed to loan to City under this Agreement.
2. SM Note.
(a) The City and Authority acknowledge that there remains outstanding on the
SM Note the principal sum of $4,028,000.00, that SM makes monthly payments of
$20,833.00 each, and that the City is the holder of the SM Note.
(b) Effective January 1, 2006 all monthly payments made by SM shall be
remitted to the City to be deposited into Fund 070 until such time as the City has
been repaid the sum of $2,400,000.00 plus interest charged at pool rate from the
Sources, whereupon monthly payments of $20,833.00 shall be dishibuted as follows:
$7,290.00 to the Authority to be deposited in Fund 117, and $13,543A0 to the City
to be deposited in the General Fund. Provided however if SM fails to make the entire
required monthly payment then the Authority shall receive the first proceeds of the
monthly payment until it receives its entire payment of $7,290.00 and the balance
shall be paid to the City.
(c) The SM Note shail not be amended, forgiven or otherwise changed by the
City without the prior written consent of the Authority.
3. Transfer of funds bv City to Authority. Promptly upon execution ofthis Agreement, the City
agrees to transfer to the Authority from Fund 070 the sum of $2,400,000.00 which the Authority
agrees to deposit into Fund 117. These funds will then be promptly transferred by the Authority to
Fund 148 and the Authority will then promptly pay the TIF Obligation to Ramsey County from the
funds deposited in Fund 148. The City and Authority acknowledge that Ramsey County will be
distributing this payment among the taxing jurisdictions consisting of Ramsey County, School
District and the City, and that the City's share is projected to be approximately $672,000.00. The
City agrees to apply this payment from Ramsey Countyto the repayment of the Fund 070 transfer
of $2,400,000.00.
4. Authority Loan to Citv. (a) The Authority agrees make the Loan to the City and to
make advances to the City as follows:
2
C�t�� t'LZ
Amount Date
$100,000.00 August 1, 2006
$190,000.00 August 1, 2007
$190,000.00 August 1, 2008
$190,000.00 August 1, 2009
$190,000.00 August 1, 2010
$860,000.00
(b) The parties agree that $25,000 of each advance shall be deposited into the City's
General Fund, and the balance of each advance shall be deposited into the City's Fund 070
and applied to the repayment of the Fund 070 transfer of $2,400,000.00.
(c) The Loan shall be repaid by the City, together with interest at the rate of five (5 %)
per annum, solely from the payments made by the SM under the SM Note in the amount set
forth in 5ection 2(b) above after Fund 070 has been fixlly reimbursed the sum of $2,400,000
plus interest charged at pool rate. This is a non recourse obligation of the City and does not
give rise to a pecuniary liability (other than from pledged payments made under the SM
Note) or general obligation ofthe City. Repayments shall first be applied to interest and then
to principal.
(d) The City hereby grants to the Authority a security interest in the SM Note to secure
the payment of the City's obligations in this Agreement. If the City defaults under its
obligations in this Agreement, the Authority may exercise and enforce all of the rights and
remedies available to a secured party under the Uniforxn Commercial Code as adopted in
Minnesota and as otherwise provided by law and equity.
5. General Terms.
(a) This Agreement shall be construed in accordance with the laws of Minnesota.
(b) This Agreement may not be amended or modified except by a writing executed by
both of the parties hereto.
(c) Each of the parties has duly authorized the execution and delivery ofthis Agreement
by a resolution duly and properly adopted by its governing body; the implementation of this
Agreement will not contravene or violate any law, rule, regulation, order or decision binding
upon such party, nor will the performance of this Agreement cause such party to violate or
default under any agreement, contract, indenture or other instrument to which it is a party,
the violation of which would cause a material impairment of such party's ability to perform
this Agreement.
(d) This Agreement may be executed in one or more counterparts, each of which shall.
be deemed an original instrument.
C(, -121
(e) If any provision of this Agreement shall be held invalid or unenforceable by a cour[
of competent jurisdiction, all of the surviving provisions hereof shall confinue in full force
and effect.
(fl This Agreement constitutes the entire agreement of the parties and shail supersede
and replace anypriorresolution, agreement orotherunderstanding with respect to the subject
hereof.
IN WITNESS WHEREOF, the City and the Authority have each caused this Agreement to
be executed by their duly authorized officers, all as of the day and year first above written.
CITY OF SAINT PAUL, MINNESOTA
Approved as to form:
�
By
Its: Mayor
Assistant City Attorney By
Its: Clerk
I�
Director, Office ofFinancial Services
Approved as to form:
Assistant City Attomey
HOUSING AND REDEVELOPMENT
AUTHORITY OF THE CITY OF SAINT
PAUL, MINNESOTA
�
Executive Director
Director, Office of Financial Services