95-443Council File � �
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RESOLUTION �I
CITYOF SAINT PAUL, NIINNESOTA
Yresented By
Referred To
Committee: Date
1
2
3
RESOLUTION ADOPTING GUIDELINES FOR THE
SAINT PAUI. CULTURAL CAPTTAL INVFSTMENT PROGRAM
(CULTURAL STAR PROGRAlVn
4 WHEREAS, by Resolu6ons No. 93-783 and 93-1045, the City has
5 imposed a one-half cent sales tax authorized by the I.aws of Minnesota 1993,
6 Chapter 375, Article 9, Section 46 and determined that ten percent of the net
7 sales tax proceeds collected pursuant thereto shall be allocated to capitai
8 projects to further cultural activities in the city; and
9 WHEREAS, by Resolution No. 94-1005 the City Council adopted
10 parameters for the use of the cultural ten percent of the net sales tax proceeds
11 through the Cultural Capital Investment Program (Cultural STAR Program)
12 and requested the development of guidelines and application procedures,
13 NOW THE_RF.FORE BE TT RESOLVED, that the attached guidelines
14 for the Saint Paul Cultural Capital Investment Program (Cultural STAR
15 Program) be adopted.
Requested by Department of:
Adopted by Council: Date
Adoption Certified by Council
By:
Appr
By:
Pla in & Econ, ic D lo�ment
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Form Approved by City Attorney
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RECOMMENDATIONS: npprove (A) or Fejeq (H) pERSONAL SEfiVICE CONTRACTS MUST ANSWEH THE FOLLOWING QUESTIONS:
__ PLANNING COMMISSION _ CIVIL SERVICE COMMISSION 1. Has this personHirm ever worked untler a contract for this tlepartment?
_ CIB COMMITfEE YES NO
— 2. Has this person/firtn ever been a city employee?
_ STAFF __ YES NO
_ DISTRICi COUaT' _ 3. Does this person/firtn possess a skill not nwmally possessed by any current ciy employee?
SUPPORTS WHICH COUNqL O&IECTNE? YES NO
Explain all yes answers on separate sheet and attach to green sheet
INITIATMG PROBLEM, ISSUE, OPPOflTUNITV (Who, Whet, When. Where, Why).
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DISADVANTAGES IF NOTAPPFiOVED:
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TO7ALAMOUN70FTRANSACTION $ „'/� COST/pEVENUEBUDGETED(CIRCLEONE) YES NO
FUNDIfdG SOUACE N( � AC7IVITY NUMBER
FINANqAL INFORMATION: (EXPLAIN) � � ' .
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SAINT PAUL CULTURAL CAPITAL
INVESTMENT PROGRAM
* The Cultural STAR Program *
GUIDELINES
April 24, 1995
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These guidelines have been developed for use by the Saint Paul Cultural District, Inc.
Board which is responsible for review of Saint Paul Cultural Capital Invesiment
Program (1/2 cerrt sales tax) proposals. The Board makes funding recommendations
to the Mayor and City Council.
Additional copies of the guidelines can be obtained from the Deparhnent ot Planning and Economic
Deve/opment, 25 West Fourth Street, Saint Paul, Minnesota 55102.
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Program Overview
The program will award grants and loans for capital projects which further
cultural activities in the City of Saint Paul. For the first 5 years, at least
75% of the annual cultural proceeds of the sales tax shall be invested in
capital projects within the boundaries of the targeted geographical area
known as the Cultural District. No more than 25°� of the annual proceeds
may be allocated to capital projects located outside the target district
provided these projects demonstrate a link to or support of activities within
the targeted District.
Key features include:
* Program funding: 10 percent of the proceeds of the City's half cent
sales tax.
* Funds are awarded annually through a competitive application
process.
* Funds must be matched as required (see specific requirements for
loans and grants) with appropriate resources.
* Funds must be spent on physical improvements that have an
expected life of at least 5 years.
* Eligible applicants include any public, private, or non-profit entity
located in or doing business in Saint Paul.
* Program al{ocation goals: a minimum of 25% {aans, a maximum of
75% grants
* Program priorities:
* Projects which help stabilize the Cultural District and cultural
institutions
* Projects which strengthen or emphasize relationships between
attractions
* Projects which help generate financial return to the cultural fund
* Improved visitor services
* Funding recommendations will be made to the Mayor and City
Council by the nine member Saint Paul Cultural District, Inc. Board,
of which five of the nine members are appointed by the Mayor and
approved by the City Council.
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TABLE OF CONTENTS
PART I - Program Description
I. Purpose and Objectives
Ii. Prioribes
Ii. Program Funding
III. General Poliaes
I. Eligible Applicants
II. Eligible Areas
111. Eligible Activities
IV. ineligible Activities
V. Eligibie Expenses
PART II - Eligibility
PART III - Application Procedure
I.
Ii.
III.
IV.
Timeline
Procedural Guidelines
Pre Application Contents
Fnat Application Corrtents
PART IV - Project Selection
I. SaiM Paul Cufturai District, Inc. Board
II. Selection Process
ill. Evaluation of Applications
PART V Loans, and Grants
I. Amount of funds allowed per project
II. Matching Requirements
111. Additional information Regarding Program or Project Proposals
IV. Loan Rates, Fees, Terms and Collateral
V. Program Development and Implementation
PART VI - Review and Evaluation
1. Project Evatuation
II. Annuai Report to the City Council and Mayor
III. Annual Review of Priorities
IV. Audits - Quality Control
For irdormatlon on Sre program, ca// 266STAR (7827) or
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PART I - Program Description
* Purpose and Objectives
* Priorities
* Program �nding
* General Policies
I. Program Purpose and Objectives
In 1993 the City of Sairrt Paul imposed an additional one-haff cent sales tax to
be used for the renovation and expansion of the Civic Center, reinvestment in
our neighborhoods, and investment in our cufturai industry. The proceeds of
the tax are to be used for capital projects to further residential, cuftural,
commercial and economic development and the intent of the City Council is that
the proceeds be used in such a way that they have significant and positive long
term economic impact. Ten percent of the net sales tax proceeds have been
allocated to capital projects to further cultural activities.
Funding of any capital project by the Saint Paul Cultural District Inc. shall
comply with one or more of the following criteria. As {ong as the focus is on the
Cultural District, the following criteria will apply:
A. Provide cultural and economic benefit to Sairrt Paul
8. Leverage the sates tax doliars with private resources
C. Create and/or retain jobs
D. Enhance and support the cultural district as a visitor attraction
E. Develop relationships between the cultural district and the neighborhoods
F. Siimuiate vitaiity of downtown
G. Support and enhance Civic Center investment
II. Priorities
The City Council and Mayor shall clearly and publicly state annual priorities for
the use of the cuRural sales tax funds. Priorities shall be proposed to the City
Council and the Mayor by the Saint Paul Cuitural District, Inc. board.
The initial priorities for the use of these funds shall be:
A Relationships between attractions - physical or architecturai
enhancements of place
B. Projects which heip stabilize the district
C. Projeets which help generate financial return to the cultura4 fund
D. Projects which contribute to improved quality of visitor services - Such as
enhanced street lighting, kiosks, information centers, signage, ticket
services, parking, restaurants, etc.
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III. Program Funding
A Ten (10°k) percent of the proceeds of the 1/2 cent sales tax, along wfth
its corresponding interest eamings, are dedicated to investment in
cufturai projects.
B. The Cuftural STAR balance as of December ist will be announced along
with a request for pre-applicafions for the next funding cycie. The
December 1st amourrt wiil be noted in the City budget as Cukural STAR
program funds.
C. Ailocations
1. At least 25°k percent of the (10%) cultural portion of sales tax
proceeds shall be allocated to low interest loans which will return
money to the cultural account.
2. A maximum of 75% percent of the proceeds shall be allocated to
direct grants.
IV. General Policies
A. No more than 25% of annual cultural sales tax proceeds can be for
multi-year funding . Multi-year funding will not be a prioriry in the first two
years.
B. The same or similar proposal can not be submitted to more than one of
the following programs in any one funding cycle: the CIB program, the
Neighborhood STAR program, and the Cukural STAR program
C. Ali loan or grant proposals shall be for $10,000 or more.
D. Sales tax funds shall be matched as follows. these are considered
minimum matches with preference accorded for iarger than required
matches:
1. Loans shall be matched 1:1
2. Grants of $10,000 -$100,000 shall be matched 1:1
3. Grants of $100,000 - 250,000 shail be matched 2:1
4. Grants of $250,000 and up shall be matched 3:1
E. Projects considered to be of insufficient quality or impact will not be
recommended for funding, even 'rf funds are available.
F. It is unlikely that the Board will approve multiple grants from one principle
applicarrt in any given grarrt cycle.
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PART II - Eligibility
* Eligible Applicants
* Eligible Areas
* Eligible Activities
* Ineligible Activities
* Eligible E�enses
I. Eligible applicants
A. My public, private,
business within the
�
or non-profit entiry, which is located within or do
City of St. Paul - EXCEPT FOR THE FOLLOW{NG:
1. Churches and religious organizations.
2. Politicai parties and related political action groups.
3. Federal, state, and county agencies and departments.
4. Individual homeowners.
City departments or divisions are eligible when in partnership with or
supported by an eligible organization.
II. Eligible areas
A. All areas within the legal limits of the Ciry of Saint Paul.
B. For the first five years of the program (calendar years 1995, 1996, 1997,
1998, and 1999) at least 75% of the annual cultural proceeds of the sales
tax shali be invested in capital projects within the boundaries of the
targeted geographicai area known as the Cuftural District in order to
maximize and support the Ciry's investment in the renovated and
expanded Civic Center. After five years the investment priorities shall be
reviewed and revised 'rf appropriate. The Sairrt Paul Cultural District is
defined as foilows:
" The geographic area bordered by Interstate 94 on the north,
Cedar Street on the east, Keilogg Boulevard on the south, and
John Ireland Boulevard to the west."
III. Eligible activities include any capitai projects or programs which
strengthen and/or improves cultural activities in Sairrt Paui. Capital
improvemerrts or capital purchases have an expected iifie ofi five (5) or more
years. Some examples of eligible activkies are:
A. Smali scale public improvements such as: trees and shrubs, benches,
play equipmerrt, beautification of pubiic space, decorative lighting, etc.
particularly as they relate to a housing or economic development
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strategy. Trees, shrubs, and lighting shoutd promate safety as welt as
aesthetics. The Program is not irrtended or normally sufficient to do
major public improvements such as street paving, curb and gutter, sewer
and water. Major public improvements should be channeled through the
aty's CIB process. When additional operation or maintenance costs
result from the public improvements, the STAR proposal must ident'rfy
how this project area will privately pay for their costs. Requests for
capital tmprovements that are defined by City policy as °above
standard° will not be considered or reviewed unless accompanied
by a legally-binding and enforceable plan for maintenance and/or
operation over the useful life of the improvemeMs proposed to be
funded through the STAR program. The most acceptable method for
maintenance and operation of above-standard public improvements is
assessments on the property taxes of those receiving the benefrt from
the improvements, though proposals that commit private or non-profit
organizations to operate and maintain above-standard pubiic
improvements will be considered, depending upon (at the City's
judgement) the viabiliry of the organization and the enforceabiliry of the
legal agreement.
B. Improvements to property such as rehabilitation, construction or other
capital improvements to residential, commercial and industrial property.
Examples include:
1. Most fixed improvements including the construction, repair and/or
decoration of walls, ceilings, floors, lighting, windows, doors,
entrances, electrical, plumbing, mechanical, air-conditioning,
architectural change, energy and secur'i1y improvements,
handicapped accessibility, code requirements, etc.
2.
3. Permit and license requirements must be fuffilied prior to
commencement of a project. In addition, the project must be in
comptiance with ali legal requirements of the City .
Health and safety items required by City buiiding codes.
a. Expansion of a commercial structure wili be aliowed if it
meets all City requirements such as zoning, parking, permit
and license requirements, etc.
b. Heaith and safery items required by Ciiy building codes.
C. Economic development efforts including but not limited to:
1. Acquisition costs including purchase options as part of capitai
project.
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Eligible non-fixed improvements such as, , �,
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2.
3.
4.
5.
6.
7.
8.
Demolition costs
Commercial parking development. Acquisition (by lease or
purchase), demol'�ion, and construction as part of a larger capital
project proposal
Costs of developing commercial parking facilities are eligibie
ac6vities. If the parking is to be privately-owned, the STAR
investmerrt must be in the form of a loan, secured by a lien on the
property. If the parking is to be publiciy-owned, the STAR
investment may be in the form of a grant, matched by capitaf and
operating assessmerrts over the usefui I'rfe of the improvement.
Utility relocation and construction as it relates to a project.
Clearance: acquisition of land or a building for clearance will only
be undertaken when it is an initial step in a proposal which will
resuR in a larger capital project as part of this proposal.
Construction costs including loan interest and fees.
Soil remediation as part of a capitai project.
IV. Ineligible activities
Any activity not leading directly to the completion of a capital project.
A. Planning or study activities.
B. Use of STAR funds to develop a STAR proposai or to organize an entity
to manage an STAR proposal.
C. Public service programs such as crime prevention, block nursing
programs, child care, and similar efforts that do not result in direct
physical improvements. These activities may be included in your total
project description/strategy, but they are not eligible for sales tax
funding. They will be directed to other Ciry programs, 'rf possible, or
private funding for these activities can be part of the project match.
D. R�nancing existing debts, except when it results in business expansion,
job creation, or is part ot a larger project.
E. Working capital
F. General administrative expenses including project management, planning,
development and administrative costs accrued before final approval of
the application, are not eligible for sales tax funding.
Examples include rent and utilities.
G. Activfties located outside the city limits.
H. Major public improvement projects, i.e., street repaving, sewer work,
recreation center, etc.
I. Sweat equiry - payment for the applicanYs own labor and performance
for construction or improvements.
J. Duplication of a current Ciry program. Applicants are encouraged to
coordinate or link proposed piojects with existing programs.
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V. Eligible expenses include any legal direct project cost that specifically
pertains to the execution of the capital project. Definition: Explicit costs that are
e�ended to carry the capitai project to compietion. Examples are dependant
on the type of project/program being implemented:
• building permits;
• design, engineering, soil, environmentai, legal, financing, licensing and
inspection fees;
• general contractor's charges (must be in line with industry standards);
• developers fee or project coordination fee that is appropriate to the
project and in line with industry standarcis;
• direct costs of staff management that are cleariy associated with the
completion of a capital project.
Note: Persons receiving the benefit of the project/program are not eligible for
developers fee. Example: business owner rehabilitating his/her business
site.
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PART 111 - Application Procedure
* Timeline
* Procedural Guidelines
* Pre Application Contents
* F�nal Application Contents
I.
II.
Tuneline
(Note: The 1995 timeline is subject to passage of guidelines and may be
adjusted.)
September Pre-apps available
Early Dec.�mber Notification of fund'sng availabi4ity, and request for pre-
applications
January 1 Saint Paul Cuftural District Board evaluation of pre-
applications resuRing in:
(1) redirection of ineligible projects, areas, appiicants;
(2) request for rework and resubmission of application in
February 1
April 1
April/May
next cycle; or,
invitation for final application along with request for project
specific information to be included.
Final applications due
Saint Paul Cultural District Board Committees, Planning
Commission, CIB Committee, and staff review of
applications
May Recommendations to Mayor
May Review by Mayor and City Council
Early June Adoption by City Council
June Commitment letters with spec�c requirements and timeline
for actions to be completed, sent to those recommended
for funding.
July Contracts negotiated assuming stipulations and timefines
have been met.
Prceedural Guidelines
A.
8.
C.
A complete pre-appiication must be submitted, on time, for a proposal to
be considered during a funding cycle.
A compiete final application must be submitted, on time, for a proposal to
be considered during a funding cycle.
Staff wiil make avaiiabie for interested parties, ail copies of the pre-
applications and finai applications for comment and review.
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D. Staff will organize a workshop at the beginning of each cycie to provide
program application information to prospective appiicants. Attendance at
the orierrtation workshop is strongly recommended. Staff may be called
upon to assist appiic�nts in developing preapplications and final
applications, based on availability of staff.
E. Rnai applications may not be changed or modfied once submitted. It is
the applicant's responsibility to thoroughly develop the proposai before
submission. However, applicants may be asked to provide additional
information in the course of review.
III. Pre-Application Purpose and Contents
Pre-applications wilt be used to determine eiigibil'ity and completeness of
proposal. Those ineligible wiil be not�ed as soon as possible. Some may be
redirected to other programs.
All pre-applications must be submitted on ihe Cultural Saies Tax Revitalization
Program pre-appiication form and contain the following information:
A. A brief description of the project proposal.
B. An estimate of the amount and type of funds (combination requests
including grants and loans, are also eligible) being requested ftom the
Sales Tax program along with an estimate of private or other kinds of
contributions.
C. Name of the organization/individual that will develop, implement and
operate the project proposal.
D. Up to three letters of support from groups affected by the proposed
project/program.
IV. I�nal Application Contents
Final application forms will be sent to eligible appiicants following the
preapplication review and approval process. The forms will be accompanied by
requests for additional project-specific information that must be addressed in
the final application. Staff, 'rf available, will be identified to provide technical
assistance at eligible applicarrt's request.
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All applications must be submitted on the Sales Tax application form and
contain the foliowing information, including buC not limited to:
A Describe the purpose of the proposal including:
1. Cuftural disVict need which the proposal addresses.
2. Detailed description of the proposai's activities or elements.
3. Cufturai district impact and projected results.
B. Level of support and participation.
1. Up to three (3) additional letters of support 'rf the letters clarify, add
to, or strengthen the proposal.
2. Description of commun'ity participation
C. ApplicanYs management experience and capability. Piease provide a
board membership list, 'rf applicable
D. Requested amount and type(s) of funding (grant andJor loan)
E. Budget
1. Projected level and source of private commitment
2. Sources and uses statement for all project funds
3. Additional elements such as: a project proforma, sources of
private lender financing, three years of past financial data, and
other information, may be required as it pertains to the proposal.
F. Time line for project that is spec'rfic and lists milestones.
G. Map indicating project location and street boundaries.
H. If above-standard public improvements are proposed for funding,
describe the legally-binding and enforceable plan for operating and
maintaining them over the useful life of the improvements.
Project's expected outcomes and a description of how they wili
measured.
J. Application Fee: A non-refundable application fee of $100 must
accompany final application forms.
If a proposal is incomplete or does not appear to be sufficiently developed to aliow for
reasonable review, the Saint Paul Cultural District, Inc. Board may return the
proposal to the applicant for further work with the suggestion that the proposai be
resubmitted during the next funding cycle.
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PART IV - Project Selection
* Saint Paul Cultural District Inc. Board
* Selection Process
* �aluation of Applications
* Bonus Points
I. 1'he Saint Paul Cultural District Inc. Board
Five members of the Saint Paul Cuftural District, Inc. board are appointed by the
Mayor and approved by the City Council. The remaining four members of the
Board are elected by the membership of the cuRural district. The Board serves
as the formal review body for proposals requesting grants or loans from the
cultural portion of sales tax funds. The Board recommends funding of 1/2 cent
sales tax proposals to the Mayor and City Council.
II. Selection Process - the selection process for proposals wili be competitive
and the Soard will determine the quality of the proposals. The number of
applicants to be funded is dependent on the size and qualiry of the proposals
and the availability of funding.
A. Pre applications wili be reviewed by the Saint Paul Cukural District Inc.
Board and will either:
1. Be rejected as ineligible, or directed to other City programs 'rf
possibie
2. Be accepted for review. The applicant wili be asked to submit a
final application with additional supporting materials as requested
by the Saint Paul Cultural District Inc. Board.
B. Completed Final Applications, will be reviewed and summarized by staff.
Applications will:
1. Be rejected by the Saint Paul Cultural District Inc. Board or 'rf
insufficiently developed, the applicant may be invited to resubmit
the proposal during the next funding cycle.
2. Be accepted and all information will be presented to the Saint
Paul Cultural District Inc. Board. Additional technical and
compliance rev�ew witl be provided by the following advisory
bodies:
a. The PED Credit Committee will review the applications for
fiscal responsibility, risk evaluation and appropriateness of
interest rates, terms and conditions, and provide this
information to the Board to assist them in making
recommendations to the Mayor and Ciry Council.
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b. The Planning Commission wiil review proposais for
compliance with the City's Comprehensive Plan and Capital
Allocation Policy. CommeMs wiil be forwarded to the SaiM
Paul Cuttural District Inc. Board, Mayor and City Council
within the established timeline.
c. fnformation on proposais witl be forwarded to the CIB
committee for informationai purposes to allow for
coordinated decision making and for coordination,
comment, and review. Comments wiil be forwarded to the
Mayor and City Council within the established timeline.
C. Anyone wishing to review and make comments on applications, is
encouraged to submit these comments in writing to the Saint Paul
Cultural District, Inc. board within the time frame of board action. The
applications wiN be availabie for review in central locations such as: the
Saint Paui Planning and Economic Development Department, the Central
Library.
D. The Saint Paul Cuftural District Inc. board will review the appiications
based on program guidelines, CIB Committee and Planning Commission
commerrts, and credit committee guidance, and make funding
recommendations to the Mayor and City Council.
E. The Mayor will present final recommendations to the City Council.
F. The City Council will make finai selections of STAR project proposals
and approve their budgets.
III. Evaluation of appliCations: Proposals wiil be reviewed for the following
eligibil'dy and additional selection criteria.
A. Proposal supports published priorities for the use of the Cultural Sales
Tax proceeds
B. Proposal meets the minimum matching requirements. (See matching
section.)
C. Proposal is an eligible program activ'ity. (See Eligible and Ineligible
Activfties sections.)
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D. Proposal is not in conflict with any city comprehensive plan element,
small area plan, capital allocation policy or adopted Cit}r ordinances and
poliaes.
E. Proposal is financialfy feasible. Requested Cultural STAR funds together
with other project resources are adequate to meet the identified need.
F. Managing organization has the capability to successfully manage and
implement the project.
G. Project effectively addresses a previously identified or othervvise clearly
documented District need or goal.
H. Proposal was developed wfth sufficient community input and serves the
cuftural district.
N. Proposals may receive preference if they include the following:
A. a positive impact on tax base
B. a positive impact on job creation
C. match which exceeds the required amounts
D. Project is part of a weil-defined, broad strategy to increase the vitality of
the Cuftural District
E. St�fficient planning or feasibi{ity analysis indicates a high probability of
success; and
F. Cuftural district support is documented - an appropriate mix of property
owners and/or business people relevant to the project included in the
G.
H.
I.
J.
planning, development and implementation of the proposal.
Proposals include direct coordination with other ciry, private, or non-profit
programs and projects
Project can leverage additional funds or resources.
Percentage of the match that is direct cash or capital investment, is high
All administrative expenses are funded through other sources
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PART V- LOANS AND GRANTS
* Amount of funds atlowed per project
* Leverage
* Additional Information Regarding Program or Project Proposals
* Loan Rates, Fees, Terms and Collaterai
* Program Development and Implementation
I. Amount of funds allowed per proposal:
A. Regular Cuftural STAR Program
1. There are no maximum loan/grarrt request amounts for the STAR
program.
2. The minimum for the regular program is $10,000.
3. Proposals wiil be funded based on their merits and funds
available.
II. Matching Requirements
A. A minimum required match of one ($1) dollar for every one ($1) received
as a loan is required. The recommended required match for grants is as
follows:
1. Grants from $10,000 -$100,000 should be matched 1:1
2. Grants from $100, 000 -$250,000 should be matched 1:2
3. Grants from $250,0�0 and up should be matched 1:3
B. Counry, Private, State and Federal funds can be used as a match.
C. Other City money can not be used to match STAR funds. For purposes
of this program CDBG money from City sources cannot be used as a
match, (an exception is listed under D).
D. Other city funds that are provided as loans may be used as a match.
This includes deferred loans as long as the loan is eventually paid.
E. Matching funds must be directly related to the project or program in the
applicanYs proposal.
F. Applicants are encouraged to fund their STAR administrative expenses
with outside private resources, i.e., foundation grants, cash donations,
etc. and to use these funds as part of the match.
G. Eligible matching contributions may include:
1. Direct financiai resources such as private expenditures for
commercial or residential physical improvements, contributions or
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funds raised from within the District, foundation and corporate
grants, and local lender commitmerrts or operating assessments
es�timated over the useful I'rfe of the improvements.
2. Indirect contributions can inGude: in-kind senrices from
residents and businesses such as personnel, professionai
services, office space, supplies, volunteer labor, and sweat equity
for physical improvements. The value of sweat equity and/or
volurrteer labor may not exceed 30°/a of the total match.
H. Inetigible matching contributions include:
1. Volurrteer meeting time.
2. in-kind service donations from STAR applicants such as already
existing office space, phone service, etc. In-kind donations from
parties other than the applicant are eligible.
3. Volunteer labor and sweat equiry over 30°k of required match.
4. Any donation not directly related to the STAR project.
Under no circumstances will any match be reimbursed with STAR funds.
J. The STAR board has the discretion to recommend approval of other
matching contributions on a case by case basis.
K. Exceptions to the match requirement wiil be considered by the STAR
board in highly unusual cases such as when a proposal is in response to
an urgent need or disaster.
III. Additional Information Regarding Project Proposals
A. Aii legal requirements of the City of Saint Paul must be met such as:
1. the property must be appropriately zoned, meaning the properry
must conform to use under the Ciry Zoning Ordinance.
2. for new construction, propert'ses must be on legal buildable lots
3. prior to performing leasehold improvements, the tenant must
obtain written permission from the building owner for the
improvements.
4. Prior to project implementation, all necessary permits must be
obtained. Upon completion of improvements, the applicant must
have followed, and the property must meet, all applicable code,
permft and license requirements. Finally, the property must be
properly inspected and must have a current Cert�cate of
Occupancy upon completion, ff applicable.
5. An applicant must have the abiliry to repay ff requesting a loan and
be an acceptable credit risk as determined by a bank or the city.
(See underwriting standards).
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6. Funds will be reieased on a reimbursemerrt basis upon receipt of
documerrtation of eligibie expense.
7. Little Davis Bacon regulations must be followed as appiicable.
B. Projects and proposals must not conflict with adopted plans and policies
of the Ciry of Saint Paul.
IV. Loan Fees, Rates, Terms, Collateral, and General Servicing
A. Rates: will be determined by the applicant, the Saint Paul Cultural District
Board and the Credft Committee's analysis of application. The PED
Credit Committee will analyze capital loan requests and rate them based
on industry and city standards.
B. Terms: terms and conditions - will be negotiated and customized for
each individual proposal.
C. Collateral may be requi�ed: The City shalt file for any liens required on
collateral.
D. Operating Assessments: If STAR capital funding is to be matched by
the operating assessment, no funding can be disbursed until final
ratification of the matching operating assessment.
E. Loan Origination and Servicing
1. Individuai payments for loans will be processed through PED
accounting.
2. Servicing Fees
a. Loans originated through PED will be charged a loan
closing fee equal to 1 1/2°� to 3 of the loan amount,
before any disbursements. (An approved origination fee
may be charged by program operators for each loan
originated.)
b. a fee of $5 to $10 will be collected with each loan payment
c. a charge of 5% of the monthly payment will be assessed on
late payments over 15 days delinquent.
d. If another party (approved by PED Credit Committee)
assumes the mortgage, a 1 1 j2°h to 3°k assumption fee on
the outstanding principal balance will be charged.
3. A sub-accounting system will be used to monitor the total loan
amount and to provide periodic reports to:
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a. the group/individual which has the loan
b. project managers
c. the City's Budget Office
d. the Mayor
e. the City Council
f. Citizens of Sairrt Paui
F. Loan Loss Ratio - in order to address loan needs which can not be met
through standard financial institution lending programs, will have a loan
loss ratio which may at times reach 20°k. The risk rating system will be
used to help assure that the program operates within this range.
V. Project Development and Implementation
A. Upon selection by the City Council, the Cuftural STAR project applicant
will receive a letter of commitment which spec�es a period of time during
which the applicant must refine its project or program, secure its private
match, meet ather requirements as specified in the letter of commitment
and enter into an agreement with the City for the use of the Star funds.
Failure to act within the period of time specified in the commitment letter
may result in canceilation of the commitment.
Projeets should be comp{eted or se{f-sustaining within the period of time
approved by the STAR Board and specified in the agreement.
B. Implementation ContraM
Prior to the impiementation of an applicanYs project, a contract will be
entered into between the City of St. Paul and the selected appiicant. The
contract will corrtain, at minimum, a scope of services to be pertormed by
ail parties, a private match section and a budget section outlining all
funding sources, and an implementation timeline. The contract will be
signed in accordance with City policy.
Implemerrtation contracts require:
1. that the project applicant has appropriate liability insurance which
insures the Ciry of St. Paul.
2. adherence, where applicabfe, to Federal, State and Local
regulations, and policies pertaining to the use of funds such as
prevailing wage standards, relocation requirements, affirmative
action, targeted vender programs, and the First Source program.
The nature of the project (ie. residential vs commercial) determines
which regulations apply. Staff will hold a compliance meeting prior
to implementation of the contract to identify regulations applicable
to project activity.
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Sales Tax aoolicants are cautioned not to make a�
commitmerrts uMil they fuily understand �otential compliance
and funding regulations.
3. impiementation must progress as projected in application, lack of
progress is grounds for withdrawing funding.
C. Sales Ta�c Fund Distribution - Sales Tax Fund allocations wiil generally
be based on submission of invoices. Final payment will be made upon
completion of the project and receipt of the final project report and
evaluation. At the time of completion of alt activities contained in the
agreement or upon expiration of the agreement, any remaining project
fund balances will be returned to the STAR Fund.
D. Projects are expected to be compieted within the time frame described in
the final application. Requests for extensions to contract effective dates
are discouraged. Proposals are selected based on certain criteria and
should not be significantiy changed during project impiementation.
E. Loans repayments will be made to the Cultural STAR Trust to be reused
for loans, grants and other expenses that further the development of the
goals for use of Cultural Sales Tax proceeds.
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PART VI - Review and Evaluation
* Project Evaluation
* Annual Report to the Ciry Council and Mayor
* Annual Review of Priorities
* Review of Atlocation Goals
* Audits - Quality Control
I. Project Evaluation
A. Semi-annual status reports will be required for each project, which will
provide an ongoing monitoring process. The report will include project
expenditures, status of match commitments, and progress toward
meeting expected project outcomes (as idenYfied in the original
application). This will allow for timely adjustment of individual projects i
necessary. Project managers will monitor and report on individual
projects for progress and compliance with contract.
B. A final evaluation of each project will be required to determine the extent
to which the project has been successful. Project success will be
measured against expected project outcomes and the overall objectives
of the STAR Program. This final evaluation must be received before the
final reimbursement request wiil be paid.
II. Annual Report to City Council and Mayor
The annual report shouid be presented in September of each year and shoufd
include:
A. Progress report on alf projects to date, their locations, and costs
B. Percentage loans and grants awarded
C. Fscal analysis of overall program
D. Effectiveness in supporting criteria
E. Estimated funds availabie for the next funding cycle
F. Evaluation of the program process and suggested revisions
III. Annual Review of Priorities (or criteria)
,�,,.y..»a...: +1... ..n.. ..F n..l.... �..., i� ....J.. :n ..� �.
Priorities for ���k����b6��;��;�g,�....,,
w. a. o...a��.m»..�..a.,w.. ro
aei�er�ieeds must be reviewed annually. These priorities shall be reviewed at
a public meeting following the presentation of the annual report and the Council
and Mayor shali clearly and pubiicly state priorities for the upcoming funding
cycie.
Target allocation goals shall be reviewed, as necessary, by the Mayor and City
Council.
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. �..
�IS-`{�3
IV. Audits - Quality Control
A. The Ciry wiil establish a monitoring and control system which ensures
that loan repayments are made under the terms of each project's
agreements.
1. R will be the responsibility of project developers to provide all
necessary documerrtation, as determined by the Ciry, for purposes
of determining program eligibility and ongoing program
compliance.
2. Reports on revolving loan programs wili be periodicaily provided to
the project deve{opers to assist in their monitoring of their
programs finances.
8. Periodic externat audits may be required.
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CPTY OF SATNT PAUL .�vo c� a�r Telephone 612-2668510
Norm Cole/nan, Mayor ZSWatKe+AoggBouleva,d Facsimi7e 612228-8513
SaintPau{ MN55102
April 27, 1995
David Thune, Councii President
Members of the City Councii
310 City Hall
Saint Paul, Minnesota 55102
RE: Cultural STAR Draft Guidelines
Dear President Thune and Members of the City Council:
It is my pleasure to forward for your review and consideration draft guidelines for the
Saint Paul Cultural Capitai Investment Program (the Cukurai STAR Program). The
Board of Saint Paul Cultural District Inc. worked with the already approved guidelines
for the Neighborhood STAR Program and adapted them to the unique needs of the
culturai industry. I recommend approval of these guidelines.
If you have additional questions, or need additional copies of the guidelines, please
contaet Amy �il�ce at 266-6648.
Sincerely,
�V Q
Norm Coleman
Mayor
NC:awf
Enclosures
qs -443
S/3/9S
� �--.—
�� �Ok�d
NOW � � R � �ORE BE TT RESOLVED, that the attached guidelines for the Saint
Paul cultural Capital Investment Program (Cultural STAR. Program) be adopted .....
with the following amendment:
Page 4, B2 shouId read:
2. Eligible non-fixed improvements such as