07-636Council File # O - ,�
Green Sheet # 3041430
RESOLUTION
J CITY F SAINT PAUL, MINNESOTA
Presemed by �� � ��`�
�a
THE CITY OF SAINT PAUL, MINNESOTA
RESOLUTION NO.
1
2
3
4
5
PUBLIC I3EARING FOR PRELIMINARY APPROVAL TO THE
PROPOSED ISSUANCE OF REVENUE BONDS FOR A MULTIFAMII.Y
HOUSING DEVELOPMENT FOR THE BENEFIT OF WINNIPEG
APARTMENTS LINIITED PARTNERSHIP UNDER MINNESOTA
STATUTES, CIIAPTER 462C, AS AMENDED
6 WH$REAS, under the terms of Minnesota Statutes, Chapter 462C, as amended (the "AcY'), the
7 City of Saint Paul (the "City") is authorized to develop and administer programs to finance multifamily
8 housing developments and is authorized to issue and seIl revenue bonds or obligations which shall be
9 payable exclusively from the revenues of the programs and the developments; and
10 WHEREAS, a housing and redevelopment authority in and for a city may exercise the powers of a
11 city under the Act if the housing and redevelopment authority is authorized by ordinance to exercise, on
12 behaif of the city, the powers confened by the Act; and
13 WHEREAS, Winnipeg Apartments Limited Partnership, a Minnesota limited partnership (the
14 "Company"), has proposed that the Housing and Redevelopment Authority of the City of Saint Paul (the
15 "Authority") undertake a housing program in accordance with the terms of the Act (the "Housing
16 Program") and issue its revenue bonds under the Act to finance the acquisition, construction and equipping
17 of a 56-unit multifamily residential rental housing development and related improvements, including a
18 commercial space of approximately 6,000 square feet (the "ProjecY'), to be ]ocated at 852-886 Rice Street
19 in the City. In addition, the Company has proposed that the Authority finance any one or more of the
20 following under the Housing Program: (i) the funding of one or mare reserve funds to secure the timely
21 payment of the Bonds; (ii) the payment of interest on the Bonds; and (iii) the payment of the costs of
22 issuing the Bonds; and
23 WHEREAS, for the purposes referenced above, the Company has requested that the Authority
24 issue two series of revenue bonds to be designated (i) Multifamily Housing Revenue Bonds, Series 2007A
25 (GNMA Collateralized Mortgage Loan - Winnipeg Apartments Project) in the aggregate principal amount
26 of approximately $3,000,000 (the "Series 2007A Bonds"); and (ii) Multifamily Housing Revenue Bond
27 (Winnipeg Apartments Project), Series 2007B (the "Series 2007B Bond"), in the original aggregate
28 principal amount of approxanately $4,000,000 (the "Series 2007A Bonds and the Series 2007B Bond are
29 hereinafter referred to collectively as the `Bonds"); and
30 WHEREAS, the Series 2007A Bonds proposed to be issued by the Authority to fmance the Project
31 will constitute revenue obligations to be issued under the terms of this resolution, a resolution of the
c�7—�3�
32 Authority, and an Indenture of Trust, dated on or after August l, 2007 (the "Series 2007A Indenture"),
33 between the Authority and U.S. Bank Narional Association, as trustee (the "Trustee"), and the proceeds
34 derived from the sale of the Series 2007A Bonds aze to be loaned by the Authority to the Company
35 pursuant to the terms of a Financing Agreement, dated on or after August 1, 2007 (the "Financing
36 AgreemenY'), between the Authority, the Company, the Trustee, and MMA Mortgage Investment
37 Corporation, a Florida corporation (the "Lender"); and
38
39
40
41
42
43
44
45
46
47
48
49
50
51
WHEREAS, pursuant to the Indenture and the Financing Agreement proceeds of the Bonds wiIl
finance a construction and permanent mortgage loan (the "Mortgage Loan"), insured by the Federal
Housing Administration ("FHA") of the Department of Housing and Urban Development under
Section 221(d)(4) of the National Housing Act of 1934, as amended (the "1Va6onal Housing AcY'), in
connection with the construcuon of the Project, through the acquisition by the Trustee for the account of
the Authority of fully-modified pass-through mortgage-backed construction loan securities (the "CLs"), to
be issued by the Lender, as construction of the Project progresses, which are to be guazanteed as to the
timely payment of principai and interest by the Government National Mortgage Association ("GNMA")
pursuant to Section 306(g) of the National Housing Act, and, upon the completion of conshuction of the
Project and the satisfaction of certain other conditions, of the exchange by the Trustee of the CLs for a
fixlly-modified, pass-through mortgage-backed project note security (the "PN"), to be issued by the Lender
and to be guaranteed as to the timely payxnent of principal and interest by GNMA pursuant to
Section 306(g) of the National Housing Act (hereinafter the CLs and the PN are sometimes collectively
referred to as the "GNMA Securities"); and
52 WHEIZEAS, the Series 2007B Bonds proposed to be issued by the Authority to finance the Project
53 will constitute revenue obligations to be issued under the terms of this resolution, a resolution of the
54 Authority, and a Loan Agreement, dated on or after August 1, 2007 (the "Loan AgreemenY'), between the
55 Authority and the Company; and
56 WHEREAS, the Series 2007B Bonds are to be secured solely by a Pledge Agreement, dated on or
57 after August 1, 2007, between the Authority and Lender (the "Pledge AgreemenY'), and other security
58 provided or arranged by the Company; and
59 WHEREAS, under the terms of the City Administrative Code, Part IV, Chapter 72, Section 72.04,
60 the City Council of the City has designated the Authority to exercise the powers confened by the Act on
61 behalf of the City; provided, however, that the Authority may not carry out any specific programs under
62 the Act unless directed and authorized to do so by a resolution adopted by the City Council of the City;
63
64
65
66
67
68
69
WHEREAS, the Bonds proposed to be issued by the Authority to finance the Project will constitute
revenue bonds secured solely by any one or more of the following: (i) the revenues derived from one or
more loan agreements or financing agreements (collectively, the "Loan Agreements") between the
Authority and the Company; (ii) a pledge and assignment of Project revenues; (iii) one or more reserve
funds to be held by a trustee for the benefit of the holders of the Series 2007A Bonds; (iv) a first mortgage
lien and security interest granted by the Company with respect to the Project; and (v) other security
provided or arranged by the Company; and
70 WHEREAS, pursuant to Section 462C.04, subdivision 2, of the Act, prior to issuing revenue bonds
71 under the terms of the Act, the Authority must prepaze a housing program in accordance with the terms of
0 7
72 Section 462C.03 of the Act and must hold a public hearing on the housing program after one publication of
73 notice in a newspaper circulating generally in the City, at least fifteen (15) days before the hearing and on
74 or before the day on which norice of the public hearing is published, the Authority must submit the housing
75 program to the Metropolitan Council for review and comment; and
76
77
78
79
80
81
WHEREAS, Section 147( fl of the Internal Revenue Code of 1986, as amended (the "Code"), and
regulations promulgated thereunder, require that prior to the issuance of bonds the intent of which is not
included in gross income for federal mcome ta�c purposes under the Code, the City Council must approve
the bonds after conducting a public hearing thereon preceded by publication of a notice of public hearing
(in the form required by Section 147(fl of the Code and applicable regulations) in a newspaper of general
circulation at least fifteen (15) days prior to the public hearing date; and
82 WHEREAS, pursuant to the Act and the Code, a nofice of public hearing in the form required by
83 the Act and Section 147(fl of the Code was published in the Pioneer Press, a newspaper of general
84 circulation in the City, and in the Legal Ledger, the official newspaper of the City, each on a date at least
85 fifteen (15) days prior to the public heazing.
86 NOW, THEREFORE, BE IT RESOLVED THE CITY COUNCIL OF THE CITY OF SAINT
87 PAUL:
88 1. Public Hearin¢. The City Council conducted a public hearing on Wednesday,
89 July 18, 2007, with respect to the proposal to undertake and finance the Project and the issuance of the
90 Bonds, as requested by the Company. A notice of the hearing, in the form required by the Act and Section
91 147(fl of the Code, was published once in the official newspaper of the Authority and in a newspaper of
92 general circulation in the City at least fifteen (15) days prior to the date of the public hearing.
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108
2. Preliminarv Approval. The City hereby grants preliminary approval to the issuance of the
Series 2007A Bonds for the purposes referenced in this resolution and in an aggregate principal amount of
approximately $3,00,000, and hereby grants preliminary approval to the issuance of the Series 2007B Bond
for the purposes referenced in this resolution and in an aggregate principal amount of approximately
$4,000,000, subject to the mutual agreement of the Authority, the Company, and the initial purchaser(s) of
the Bonds as to the details of the Bonds and provisions for their payment. In all events, it is understood,
however, that the Bonds shall not constitute a pecuniary liability or chazge, lien, or encumbrance, legal or
equitable, upon any funds, assets, taxing powers, or any other property of the Authority or of the City
except the Authority's interest in the Loan Agreements; and the Bonds, when, as, and if issued, shall recite
in substance that the Bonds, including interest thereon, are payable solely from the revenues received from
the Loan Agreements and other property pledged to the payment thereof, and shall not constitute general or
moral obligations of the Authority or of the City. The Bonds sha11 not constitute a debt of the Authority or
the City within the meaning of any consfitutional or statutory limitation. The holder(s) of the Bonds shall
never have the right to compel any exercise of the t�ing power of the Authority or the City to pay the
outstanding principal of the Bonds, or the interest thereon or to enforce payment thereof against any
property of the Authority or the City.
109 3. FindinQS. It is hereby found and determined that the Project fiirthers the purposes set forth
110 in the Act and the Project constitutes a"multifamily housing developmenY' within the meaning of the Act.
d7-1 3�
110 4. Authoritv to Undertake the Proiect. The City Council of the City hereby directs and
i l l authorizes the Authority to cazry out the Housing Program to finance the Project and to issue the Bonds as
112 revenue bonds under the terms and conditions of the Act.
113 5. Other Actions. The City Council of the City hereby directs and authorizes the Authority to
114 take any and all actions authorized by the Act to carry out the Housing Program with respect to the Project
115 as deternuned to be appropriate by the Authority.
116 6. Fees and Costs. The Company shall pay to the Authority any and all costs incurred by the
117 Authority and the City in connection with the Bonds or the financing of the Project, whether or not the
118 fmancing of the Project is carried to compietion, and whether or not the Bonds or operative instruments are
119 executed and delivered. The Company shall also comply with the Authority administrative fee policies
120 respecting such revenue bond issues. The Company shall comply with all requirements imposed upon the
121 Company by the terms of the Memorandum of Understanding (the "Memorandum of Understanding"),
122 between the Authority and the Company.
123 7. No Commitment to Issue Bonds. The adoption of this resolution does not constitute a
124 guaranty or firm commitment that the Authority will issue the Bonds as requested by the Company. The
125 Authority shall retain the right in its sole discretion to withdraw from participation and accordingly not to
126 issue the Bonds, or issue the Bonds in an amount less that the amount refened to herein, should the
127 Authority at any time prior to issuance thereof determine not to issue the Bonds, or to issue the Bonds in an
128 amount more or less than the amount refened to in paragraph 2 hereof, or should the parties to the
129 transaction be unable to reach agreement as to the terms and conditions of any of the documents required
130 for the transaction.
131 8. Reimbursement. The United States Department of the Treasury has promulgated final
132 regulations governing the use of the proceeds of tax-exempt bonds, ail or a portion of which are to be used
133 to reimburse the Authority or a borrower from the Authority for project expenditures paid prior to the date
134 of issuance of such bonds. Those regulations, Treasury Regulations, Sectiott 1150-2 (the "Regulations"),
135 require that the Authority adopt a statement of official intent to reimburse an original expenditure not later
136 than sixty (60) days after payment of the original expenditwe. The Regulations also generally require that
137 the bonds be issued and the reimbursement allocation made from the proceeds of the bonds occur within
138 eighteen (18) months after the later of: (i) the date the expenditure is paid; or (ii) the date the project is
139 placed in service or abandoned, but in no event more than three (3) years after the date the expenditure is
140 paid. The Regulations generally permit reimbursement of capital expenditures and costs of issuance of the
141 bonds.
142 The City reasonably expects the Authority to reimbarse the Company for the expenditures made for
143 costs of the Project from the proceeds of the Bonds after the date of payment of a portion of the costs of the
144 Project. All reimbursed expenditures sha11 be capital expendihues, a cost of issuance of the Bonds, or
145 other expenditures eligible for reimbursement under Section 1.150-2(d)(3) of the Regulations and also
146 qualifying expenditures under the Act.
147 Based on representations by the Company, no expenditures for the Project have been made by the
148 Company more than sixty (60) days before the date of adoption of this resolution other than:
149 (i) expenditures to be paid or reimbursed from sources other than the Bonds, (ii) expenditures permitted to
O�-�3�
150 be reimbursed under prior regulations pwsuant to the transitional provision contained in
151 Section 1.150-2(j)(2)(i)(B) of the Regulations; (iii) expenditures constituting preliminary expenditures
152 within the meaning of Section 1.150-2(fl(2) of the Regulations; or (iv) expenditures in a"de minimus"
153 amount (as defined in Section I.150-2(fl(1) of the Regulations).
154 Based on representations by the Company, as of the date hereof, there are no funds of the Company
155 reserved, allocated on a long term-basis, or otherwise set aside (or reasonably expected to be reserved,
156 allocated on a long-term basis, or otherwise set aside) to provide permanent fmancing for the expenditures
157 related to the Project to be financed from proceeds of the Bonds, other than pursuant to the issuance of the
158 Bonds. This resolution, therefore, is determined to be consistent with the budgetary and financial
159 circumstances of the Company as they exist or aze reasonably foreseeable on the date hereof.
160 9. Memorandum of Understandin¢. The Memorandum of Understanding in the executed form
161 on file with the Authority is hereby ratified and approved.
162 10. Housing Pro�ram. The housing program prepared in accordance wiYk the terms of the Act
163 (the "Housing Program") and submitted to the Metropolitan Council for its review prior to the date hereof,
164 is hereby ratified and approved
165 11. Bond Counsel. Kennedy & Graven, Chartered is hereby designated as bond counsel with
166 respect to the Bonds and is hereby authorized to take all actions necessary to prepare necessary documents
167 to permit the issuance of the Bonds and to submit such documents to the Board of the Authority for its
168 final approval.
Adopted by the City Council of the City of Saint Paul, Minnesota on this 18th day of July, 2007.
169
Benanav
Bostrom
Harris
Helgen
Thune
Adopted by Council: Date
Absent
Adoption Certified by Council SecreYdsy
By: i
Approved Ma Date "L Q
By:
v� �
Form Approv by i Att
By:
Developme�
Form Approved by Mayor for Submission to Counci]
By: ��-n��_�e1�c�, �-S o�
Approved bylhe u '� ci 1 ervices
By:
�
� Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet �
�7�v3�
PE —Planning & Ecouomic Developmeot
03-JUL-07
Green Sheet NO: 30�1430
Contact P¢rson S Pho�:
Dan Bayers
6-G685
Must Be on Council Agen
16-JUL-07 M „ r . r „ .,
Doe. RESOLUTION
y
Assign
Number
For
Rauting
Order
E-Document Required: N ( (
�ocument Confact:
^ ContactPhorte: - "
ToWi # of Signature Pages � (Clip All Loeations for Signature)
0 RT%����E&Economiclleveloomel Ihzector-t:.ueoor � — �
I " Attoru G5 Attorne �
2 inandx! Setri<es ffice Fivantial Services
3 a r's Office Ma or/Assistant 3
4 ' Cterk ' � Clezk
�L�011G 1"72G.CrnC� -
�_�_' )
t
________._____ ,
PUBLIC HEARING for a Ciry Council Resolution authorizing approval for the Multi Family Revenue Bonds in the amount of
7,000,000 for the Winnipeg P%}ect located oa Rice Street. �
°ntlatlons: Approye (n) or tte�ect (K
_ Phanning Commission
GB CommitYee . .
CPoiI Service Commission .
L Has Nis persoNfmn ever worked uMer a contract for Mis departmenY?
Yes No
2. Has this persoNfirm ever been a ci4y employee?
Yes No
3. Does this persoNfirm possess a skili noE Floanaily possessed by any
cuRentcityemployee? . .
Yes No - � � } `
Expfain ali yes answers on uparate sheet and atEach to green sheet
initiating Pro6lem, tssues, OpRortunity kYVho, What, When, Where, Wby): -
A PUBLFC HEA,RING�foz preliminary.approval by resolution of MuUi Family Revettuc.Bonds foa the Winnipeg Apartment prajecE.
Winnipeg� Apart.ment LP.has appTied for l�fulti Family Revenue Bond in help construct a 56 unit aparfinent camplex on Rice Street.
_ . , . . - � - s , . .
Advantages [f.F+pAroved: � �
Conshucf af an affordable S6 uni[ apartrnent complex in the Norfh End of Sain[ Paul.
Oisadvantagesifkpprqved:
None
�°.CSS.dd;��.:i a�°?����"a,h
JUL 05 2007
Disadvantageslf Not ApproKed:
'Fhe project wi•11 notbe completed.
Totai Anfount oz . ` Cost/Revenue Budgeted: Gy
-7lansact�ola : y ,� "�� p�Ej� �(j �
Funa;ng source �uf�Fainily�tevenve B�nds A�t���4v Numter. �� �� �• ��
Pinancialln€ormation: � ,�� �
(EXptain) NO � ��F7 Y C •� �f Kr >
'\J
July 3, 2007 932 AM Page 1
� 7 3b
CITY COUNCIL OF THE CITY OF SAINT PAUL, MINNESOTA
REPORT TO THE COUNCILMEMBERS DATE July 18, 2007
�G��� NOTICE OF A PUBLIC HEARING WITH RESPECT TO THE
FINANCING OF A MULTIFAMILY HOUSING DEVELOPMENT
FOR THE BENEFIT OF WINNIPEG APARTMENTS LIMITED
PARTNERSHIP UNDER MINNESOTA STATUTES,
GHAPTER 462C, AS AMENDED, DISTRICT 6
PURPOSE
The City of Saint Paui has received a request from Winnipeg Apartments Limited
Partnership, a Minnesota limited partnership (the "Borrower") comprised of Legacy
Management and Development Corporation, to assist in the financing of the Winnipeg
Apartments, a 56 unit affordable rental housing project with 6,000 square foot of
commercial space on the first floor (the "ProjecY'), located in District 6
COUNCIL ACTION
A resolution was submitted for the City Councilmembers consideration:
Final approval of a resolution authorizing the issuance of Multifamily Housing Revenue
Bonds in the amount of approximately $7,000,000 for the Winnipeg Apartments project.
2. Final approval of the Housing Program for the Project which was prepared in accordance
with the provisions of Minnesota Statutes, section 462C.03; and
Authorize the Executive Director of the HRA to enter into a Memorandum of
Understanding (MOi� with Winnipeg Apartments Limited Partnership and to work
towards possible issuance of the Bonds. The MOU also stipulates the terms and
conditions for issuance of the Bonds should the HRA decide to issue the Bonds; and
4. Retain John C. Utley of Kennedy & Graven as bond counsel for said Bonds and authorize
them to assist in the prepazation and review of necessary documents relaring to the
Project and Housing Program and consult with the HRA, City Attorney, Owner, and
purchasers of the proposed Bonds; and
AAproval of the inducement resolution and execution of the Memorandum of
Understandine does not require or obli¢ate the Citv or HRA to issue bonds or cause anv_
action aeainst the City or III2A arisine from anv failure or refusal bv the Citv or HRA to
approve the proiect or issnance of the Bonds.
0 7-� 3G
With respect to multifamily housing bonds, Section 72.04 of Chapter 72 of the City's
Admuustrative Code provides that the HRA be designated to exercise on behalf of the City the
powers conferred by 1Vlinnesota Statutes 462C (housing programs and revenue bonds) but only
unless directed and authorized to do so by resolution adopted by the City Council. Thus the
reason, this proposal is initiated before the City Council rather than the IIRA.
HOUSING PROJECT
The Project consists of a two - three story apartment building containing 56 affordable rental
housing units built above two 3,000 sq. ft. commercial spaces. Amenities include: covered
pazking, elevator, laundry facility and common gathering space. The Project will comply with
the City's rental affordability requirement of 10% of the units affardable at 30% of inedian
income and 10°/u of the units affordable at 50% of inedian income. The project will also comply
with the City's "Green Policy".
FINANCING
The Project will be funded by a combination of multifamily tax exempt bonds, federal Low
Income Housing Taac Credit Program (4%), Minnesota Housing Finance Agency, Family
Housing Fund and Metropolitan Council, Departrnent of Employment and Economic
Development. The t� credits aze not from the City's annual ailocation but aze 4% credits
eligible for use with tax exempt bonds (the maximum rents must be affordable at no more than
60 percent of area median income.) The Department of Housing and Urban Development is
processing an application for HUD insurance to enhance the bonds.
The Housing and Redevelopment Authority of the City of Saint Paul (HRA) is asked to provide
gap financing of approximately $3,200,000 from the sale of taxable bonds from the Scattered
Site Tax Increment Financing District No1A, Invest Saint Paul STAR Bond funds and
Community Housing Development Organization (CHDO) HOME funds. The estimated Total
Development Cost is $12,257,617.
Tax Exempt Bonds
The bonds will be issued in Series A and Series B. The Series A bond (HUD insured) will be the
first position secwed long term debt and will be repaid from project cash. The Series B bond
wili be short term and will be repaid from equity pa}�ments to be made by the limited partners
(4% low income housing tax credit investars). It is necessary to issue two bonds in order to meet
the 50 °!o test which requires the use of t� exempt bonds to pay a minimum of 50% of project
costs.
For the past several yeazs, the entitlement has been used for housing projects and mortgage
revenue bonds or mortgage credit certificates to finance the City's single family mortgage
program. Because the Winnipeg Apartments will be owned by a for-profit entity, the proposed
bonds will count as part of the City's entitlement bond allocation from Yeaz 2007.
o �-� �?b
FEE5
The non-refundable appiication fee of $5,000 has been paid. Should the Bonds be issued,
the HRA will receive an administrative fee at closing equal to one percent of the principal
balance of the Bonds. Every yeaz thereafter that the Bonds remain outstanding the IIRA
will receive an annual administrative fee equal to one-tenth of one percent of the
outstanding principal balance of the Bonds.
BUSINESS PROFILE
Legacy Management & Development Corporation was founded in 1970 to develop quality
housing for specific segments of the community, i.e., seniors, families and handicapped
individuals. Currently, they have developed or manage more than 1,500 housing units in
Minnesota. Housing units consist of subsidized, taY credit and market rate, ranging from
scattered site, to small and lazge apar[ment and townhome communities.
SUPPORT
The project received support from the District 6 Planning Council.
PUBLIC PURPOSE
The following public purposes will be met:
Project will provide affordable housing opportunities for persons at 60%, 50% and 30%
of inedian incomes.
2. Project meets objectives of The Housing Plan, adopted as part of the City's
Comprehensive Plan, Section 6.0, Strategy 3: Ensure Availability of Affordable Housing.
PUBLIC HEARING NOTICE
The public hearing notice has been published in the Pioneer Press on July 2, 2007. A public
hearing notice was also published in the Legal Ledger on June 28, 2007.
RECOMMENDATION
The staff recommends the City Council consider the attached resolutions which approve the
following actions:
1. Final approval of a resolution authorizing the issuance of Multifamily Housing Revenue
Bonds in the amount of approximately $7,000,000 for the Winnipeg Apartments project.
2. Final approval of the Housing Program for the Project which was prepazed in accordance
with the provisions of Minnesota Statutes, section 462C.03; and
�7
3. Authorize the Execurive Director of the HRA to enter into a Memorandum of
Understanding (MOi� with Winnipeg Apatlments Limited Partnership and to work
towazds possible issuance of the Bonds. The MOU also stipulates the terms and
conditions for issuance of the Bonds should the HRA decide to issue the Bonds; and
4. Retain John C. Utley of Kennedy & Graven as bond counsel for said Bonds and authorize
them to assist in the prepazation and review of necessary documents relating to the
Project and Housing Prog�am and consult with the City StafF, HRA Staff, City Attorney,
Owner, and purchasers of the proposed Bonds.
Sponsored By: Councilmember Helgen
Attachxnents:
City Councii Resolutions
Multi-Family Rental Housing Program
Elevation Drawing and Site Plan
Report prepared by: Daniel Bayers, (266-6685)
o � �3�
HOUSING AND REDEVELOPMENT AUTHORTTY OF T'HE
CITY OF SAINT PAUL, MINAiESOTA
HOUSAVG PROGRAM FOR A
MULTIFAiVIILY HOUSING DEVELOPMENT
Pursuant to Minnesota Statutes, Chapter 462C (the "AcP'), the Housing and Redevelopment
Authority of the City of Saint Paul, Minnesota (the "Authoriry") is authorized to develop and administer
programs to finance the acquisition of multifamily housing developments under the circumstances and
within the limitations set forth in the Act. Minnesota Statutes, Section 462C.07 provides that such
programs for multifamily housing developments may be financed by revenue bonds issued by the
Authority.
The Authority has received a proposal that it approve a program providing for the acquisition,
construction and equipping of a 56-unit multifamily residential rental housing development and related
improvements, including a commercial space of approximately 6,000 square feet (the "ProjecY'), to be
located at 852-886 Rice Street in the City of Saint Paul (the "City"). The acquisition of the Project is to
be funded in part through the issuance of a series of revenue bonds in an aggregate principa] amount not
expected to exceed $3,000,000 to be issued by the Authority (the "Series 2007A Bonds"), the proceeds of
which will be loaned to Winnipeg Apartments Limited Partnership, a Minnesota ]imited partnership (the
"Company"). In addition, the acquisition, construction and equipping of the Project is to be funded in
part through the issuance of a revenue bond in an aggregate principal amount not expected to exceed
$4,QOO,Q00 to be issued by the Authority (the "Series 2007B Bond"), the proceeds of which will be
loaned to the Company. The Company will operate the Project or will retain a manager to operate the
Project. Tt is expected that dwelling units of the Project will be subject to occupancy limits imposed by
federal income tax law and regulations such that only persons and families within designated income
limits will be permitted to occupy such units.
The Authority, in establishing this multifamily housing program (the "Housing Program"), has
considered the information contained in the Authority's comprehensive plan. The Project will be
acquired, constructed, and equipped in accordance with the requirements of Subdivisions 1 and 2 of
Section 462C.05 of the Act.
Standazds and Requirements Relating to the Financing of the Project Pursuant to this Housing Program
Section A. Definitions. The following terxns used in this Housing Program shall have the
following meanings, respectively:
"AcY' shall mean Minnesota Statutes, Chapter 462C, as currently in effect and as the
same may be amended from time to time.
"Authority" shall mean the Housing and Redevelopment Authority of the City of Saint
Paul, Minnesota
"City" shall raean the City of Saint Paul, Minnesota.
"Company" shali mean Winnipeg Apartments Limited Partnership, a Minnesota limited
partnership.
o �
"Housing Program" shail mean this housing program for the financing of the Project
pursuant to the Act.
"Housing UniY' shall mean any one of the dweiling units, each located in the Project,
occupied by one person or family, and containing complete living facilities.
"Land" shall mean the reai property upon which the Project is situated.
"ProjecY' shall mean the 56-unit multifaznily residenriat rental housing development and
related improvements, including a commerciai space of approximately 6,000 square feet, to be
acquired, constructed, and equipped by the Company.
"Series 2007A Bonds" shall mean the revenue bonds, designated as the Multifamily
Housing Revenue Bonds, Series 2007 (GNMA Collateratized Mortgage Loan — Winnipeg
Aparhnents Project), to be issued by the Authority to finance the Project, fund one or more
reserves, and pay the costs of issuing the Series 2007A Bonds and the Series 2007B Bond.
"Series 2007B Bond" shall mean the revenue obligation to be designated as the
Muttifamily Housing Revenue Bond (Winnipeg Apartments Project), Series 2007B, to be issued
by the Authority to finance the Pro}ect and pay the costs of issuing the Series 2007A Bonds and
the Series 2007B Bond.
Secrion B. Pro¢ram For Financing the Project. It is proposed that the Authority establish this
Housing Program to provide financing for the acquisition, construction and equipping of the Project at a
cost and upon such otherterms and conditions as are set forth herein and as may be agreed upon in
writing between the Authority, the initial purchaser of the Series 2007A Bonds, the initial purchaser of the
Series 2007B Bond, and the Company. The AuthoriTy expects to issue the Series 2007A Bonds and the
Series 2007B Bond as soon as the terms of the Series 2007A Bonds and the Series 2007B Bond haue been
agreed upon by the Authority, the Company, the initial purchaser of the Series 2007A Bonds, and the
initial purchaser of the Series 2007B Bond. The proceeds of the Series 2007A Bonds and the
Series 2007B Bond will be loaned to the Company to finance the acquisition, construction, and equipping
of the Project, to fund required reserves and to pay the costs of issuing the Series 2007A Bonds and the
Series 2007B Bond. It is expected that a trustee will be appointed by the Authority to provide for the
payment of principal and interest on the Series 2007A Bonds. It is expected that the Series 2007B Bond
will be sold to a single institutional purchaser and all principal and interest payments on the Series 2007B
Bond will be paid directly to the owner of the Series 2007B Bond.
It is anticipated that the Series 2007A Bonds will have a maturity not expected to exceed foriy-
five (45) years or less and will bear interest at a variable rate or at fixed rates consistent with the market at
the time of issuance. It is anticipated that the Series 20078 Bond will have a maturity not expected to
exceed ten (10) years or less and will bear interest at a variable rate or at fixed rates consistent with the
mazket at the time of issuance.
The Authority will hire no additional staff for the administration of the Housing Progam. Insofar
as the Authority will be contracting with underwriters, legal counsel, bond counsel, the trustee, and
others, all of whom will be reimbursed from bond proceeds and revenues generated by the Housing
Progam, no administr�ative costs will be paid from the Authority's budget or the City's budget with
respect to this Housing Program. Neither the Series 2007A Bands nor the Series 2007B Bond will be
general or morai obligations of the Authority, but are to be paid only from properties pledged to the
payment thereof, which may include additiona] security such as additiona] collateral, insurance, a]etter of
credit, or other credit enhancement.
d �-�3b
Secrion C. Standazds and Requirements Relatine to the Financing of the Project Pursuant to the
Housine Progsam. The following standards and requirements shall apply with respect to the operation of
the Project by the Company pursuant to this Housing Progam:
(1) Substanrially all of the proceeds of the sale of the Series 2007A Bonds and the
Series 2007B Bond will be applied to the acquisition, construction, and equipping of the Project,
the payment of the costs of issuing the Series2007A Bonds, and the funding of appropriate
reserves. The proceeds of the Series 2007A Bonds will be made available to the Company
pursuant to the terms of a loan agreement (or other revenue agreement) which will inciude certain
covenants to be made by the Company to the Authority regarding the use of proceeds and the
character and use of the Project. The proceeds of the Series 2007B Bond will be made available
to the Company pursuant to the terms of a loan agreement (or other revenue agreement) which
will include certain covenants to be made by the Company to the Authority regazding the use of
proceeds and the character and use of the Project.
(2) The Project qualifies as a"multifamily housing development," within the
meaning of the Act, since it is comprised of an apartnnent facility, the units of which are rented to
persons or families for use as residences.
(3) The Company, and any subsequent owner of the Project, will not arbitrarily reject
an application from a proposed tenant because of race, color, creed, religion, national origin, sex,
marital status, or status with regazd to public assistance or disability.
(4) It is expected that: (i) twenty percent (20%) of the Housing Units will be held for
occupancy by families or individuals with gross income not in excess of fifty percent (50%) of
median family income, adjusted for family size; or (ii) foxty percent (40%) of the Housing Units
will be held for occupancy by families or individuals with gross income not in excess of sixty
percent (60%) of inedian family income, adjusted for family size. This set aside will satisfy the
low-income occupancy requirements of Section 462C.05, subdivision 2, of the Act.
(5) Pursuant to the Authority's policies, it is expected that at least ten percent (10%)
of the Housing Units will be held for occupancy by families or individuals with gross income not
in excess of fifty percent (50%) of inedian family income, adjusted for family size and an
additional ten percent (10%) of the Housing Units will be held for occupancy by families or
individuals with gross income not in excess of thirty percent (30%) of inedian family income,
adjusted for family size. The Housing Units set aside to meet these requirements may be the
same Housing Units set aside to meet the requirements delineated in Section C(4) above.
(The remainder of this page is intentionally left blank.)
°�
(6) The unit mi�c, size of units, and proposed monthly rents per unit are shown on the
following table:
Unit
Type
1BR
1BR
1BR
2BR
2BR
2BR
3BR
3BR
Number
of Units
2
3
21
3
22
1
Square Footage
of Uniu
Proposed Monthly
Rent Per Unit
Total
56
655
b55
655
892
892
892
1,409
1,409
$190
$705
$705
$222
$840
$840
$252
$967
Subsection D. Evidence of Com hp 'ance. The Authority may require from the Company, at or
before the issuance of the Series 2007A Bonds and the Series 2007B Bond, evidence satisfactory to the
Authority of compliance with the standards and requirements for financing established by the Authority,
as set forth herein; and in connection therewith, the Authority or its representatives may inspect the
relevant books and records of the Company in order to confirm such ability, intention and compliance. In
addition, the Authority may periodically require certification from the Company concerning continuing
compliance with vazious aspects of this Housing Program.
Subsection E. Issuance of Series 2007A Bonds. To finance the Housing Program authorized by
this Section, the Authority will by resolution authorize, issue and sell (i) the Series 2007A Bonds in an
aggregate principal amount of approximately $3,000,000; and (ii) the Series 2007B Bond in an aggregate
principal amount of approximately $4,000,000. The Series 2007A Bonds and the Series 2007B Bond will
be issued pursuant to Section 462C.07, subdivision 1, of the Act, and wit] be payable primarily from the
revenues of the Housing Program authorized by this Section. The costs of the Project, including costs of
issuance of the Series 2007A Bonds and the Series 2007B Bond and required reserve funds, are presently
expected to be in excess of the principal amount of the Series 2007A Bonds and the Series 2007B Bond.
It is expected that the Company will coniribute to the Project the difference between the total costs of the
Project and the principal amount of the Series 2007A Bonds and the Series 2007B Bond available to
finance the Project. The costs of the Project may change between the date of preparation of this Housing
Program and the date of issuance of the Series 2007A Bonds and the Series 2007B Bond. The
Series 2007A Bonds and the Series 2007B Bond aze expected to be issued in the third calendaz quarter
of 2007.
Subsection F. Severabilitv. The provisions of this Housing Program are severable and if any of
its provisions, sentences, clauses or paragraphs shall be held unconstitutional, contrary to statute,
exceeding the authority of the Authority or otherwise illegal or inoperative by any court of competent
jurisdiction, the decision of such court shall not affect or impair any of the remaining provisions.
Subsection G. Amendment. The Authority shal] not amend this Housing Program, while
Series 2007A Bonds authorized hereby are outstanding, to the detriment of the holders of such
Series 2007A Bonds.
n
d 7 ��3;�
Subsection FL State Ceiline. The Authority and the City will allocate a portion of the
"entitlement issuer allocarion" made to the City pursuant to Minnesota Statutes, Section 474A.03,
subdivision 2a, of the annuai volume cap for private activity bonds pursuant to Section 146 of the Intemal
Revenue Code of 1986, as amended, and Minnesota Statutes, Chapter 474A, as amended (the "Allocation
AcP').
Pursuant to the terms and requirements of the Allocarion Act (i) the Project will meet the
requirements of Secrion 142(d) of the Internal Revenue Code of 1986, as amended (the "Code"),
regarding the incomes of the occupants of the Project; (ii) the masimum rent for at least twenty percent
(20%) of the units in the Project will not exceed the azea fair market rent or exception fair mazket rents for
existing housing, if applicable, as established by the United States Department of Housing and Urban
Development; (iii) the Company will enter into a binding agreement with the Minnesota Housing Finance
Agency under which the Company is obligated to extend any existing low-income affordability
restricrions and any contract or agreement for rental assistance payments for the masimum term
permitted, including any renewals thereof; and (iv} the Minnesota Housing Finance Agency will certify
that the Project reserves will be maintained on the date of issuance of the Series 2007A Bonds and
budgeted in future yeazs at the lesser of: (A) the level described in Minnesota Rules, part 4900.0010,
subpar[ 7, item A, subitem {2), effective May 1, 1997; or {B} the level of project reserves available prior
to the issuance of the Series 2007A Bonds and the Series 2007B Bond, provided that additional money is
available to accomplish repairs and replacements needed at the time of the issuance of the Series 2007A
Bonds and the Series 2007B Bond.
Prior to the issuance of the Series 2007A Bonds and the Series 20075 Bond, the Company will
enter into a fifteen-year agreement with the Authority that specifies the maximum rental rates of the rent-
restricted units in the Project and the income levels of the residents of the Project occupying the income-
restricted units. Such rental rates and income levels must be within the limitations established in
accordance with the preceding paragraph. The Company will be required to annually certify to the
Authority over the term of the agreement that the rental rates for the rent-restricted units are within the
]imitations under the preceding paragraph. The Authority may request individual certification of the
income of residents of the income-restricted units of the Project. The Minnesota Department of Finance
may request from the Authority a copy of the annual certification prepared by the Company. The
Minnesota Department of Finance may require the Authority to request individual certification of all
residents of the income-restricted units of the Project.
SA130-091 (JU)
311226v2
�
� �
O
������
Aj @3 $ 1
�
�$a'3
�� aagy
(V zo�_: �
� p i � e��� � � �
. � '��� �e's3oe y p '
p ��$ � , S
^� �� Sa�§ ;¢eao s ; y
a `§E_& 3 � a � F�
�
�
M �5�
0 6� �,3,6
T
J
a.
t t 4
• �1�@�
� �3 �
R �
}
� � �� ��� �
� ��
��� ��� � � �
� xe-
� eya ua fi� '��'.' �
�
�
I
�
�ais
aao�irv
i _. �
��-�3b
�r
:� �_,.n.-,
:�:...�.
�_::s:s�.� �>1.
�
�
►:
a v � ��
\4 R
�
� � `�`' �' ' 4 . '!
�
� �� w �
.
, �� [ � �� ; ����,�� � ..
Fn ` p
��: ��.:,� ���� �
�
: t'
�'
' �.. ., � �� � 3
� ��
� � j
�. � '_.. �: `�t __ fS����Y�