HomeMy WebLinkAbout25-151 - ADMIN Resolution - City Council - 2025/11/17Resolution No. 25-151
Approving the form and execution of a QCT preservation letter for a
multifamily housing project to be undertaken by LSBD St. Louis Park
Boone, LLC
Be it resolved by the city council (the “city council”) of the City of St. Louis Park,
Minnesota (the “city”) as follows:
Section 1. Recitals.
1.01. The city is a home rule charter city and political subdivision duly organized and
existing under its charter and the Constitution and laws of the State of Minnesota.
1.02. Pursuant to Minnesota Statutes, chapter 462C, as amended (the “housing act”),
the city is authorized to carry out the public purposes described in the housing act by providing
for the issuance of revenue bonds or other obligations to finance multifamily housing
developments located within the city.
1.03. LSBD St. Louis Park Boone, LLC (or another entity to be formed by or affiliated
with Broadway Street Development, LLC, the “borrower”), has proposed that the city, pursuant
to the housing act, issue its conduit revenue bonds or other obligations (the “bonds”), the
proceeds of which will be loaned by the city to the borrower, and the borrower will apply the
proceeds of such loan to finance the acquisition, construction and equipping of a multifamily
rental housing development and facilities functionally related and subordinate thereto to be
located at 8800 Highway 7 in the city (the “project”).
1.04. The borrower has represented to the city that the project is expected to qualify
for low-income housing credits (“LIHTC”) under section 42 of the Internal Revenue Code of
1986, as amended (the “code”), based on the proposed issuance of the bonds by the city and
the loan of the proceeds thereof to the borrower, and the borrower’s use of such proceeds to
acquire and construct the project.
1.05. For purposes of calculating the LIHTC, in the case of buildings located in areas
designated as “Qualified Census Tract” (“QCTs”), eligible basis may be increased up to thirty
percent (30%) from what it would otherwise be.
1.06. The borrower has further represented to the city that the project is located in an
area that is designated as a QCT in 2025 for purposes of the LIHTC under section 42 of the code,
but will not be designated a QCT in 2026.
1.07. As provided in a notice of the United States Department of Housing and Urban
Development published at 89 Federal Register 73113 (Sept. 9, 2024) (the “HUD notice”), the
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QCT designation may be preserved for 730 days (2 years) if the borrower submits a complete
bond application to the city, and a complete bond application means that no more than de
minimis clarification of the application is required for the city to make a decision about the
issuance of bonds requested in the application.
1.08. The borrower submitted, and the city received, a bond application (the “bond
application”), for the project and the issuance of the bonds by the city to finance the acquisition
and construction of the project, and the borrower has requested that the city execute and
deliver a letter, the form of which is on file with the city, for purposes of having the area in
which the project will be constructed, continue to be treated as a QCT from and after January 1,
2026 under section 42 of the code in accordance with the HUD notice (the “QCT preservation
letter”).
Section 2. Based on representations made by the borrower to the city to date, the
city council hereby makes the following preliminary findings, determinations, and declarations:
(a) The city has received and reviewed the bond application and has determined
that no more than de minimis clarifications to the bond application (if any) would be required
for the city to make a final decision to issue the bonds that are requested in the bond
application, and, as such, the bond application is complete for purposes of section 42 of the
code.
(b) The city council hereby authorizes the execution and delivery of the QCT
preservation letter by the city manager of the city, or her designee, in substantially the form
now on file with the city which is hereby approved, with such necessary and appropriate
variations, omissions, and insertions as are approved by Kutak Rock LLP, bond counsel to the
city (“bond counsel”), as do not materially adversely change the substance thereof with respect
to the city, and as the city manager, in her discretion, shall determine, and the execution
thereof by the city manager shall be conclusive evidence of such determination.
Section 3. The adoption of this resolution does not constitute a guaranty or firm
commitment that the city will issue the bonds as requested by the borrower in the bond
application. If, as a result of information made available to or obtained by the city during its
review of the project, it appears that the project or the issuance of the bonds to finance the
costs thereof is not in the public interest or is inconsistent with the purposes of the housing act,
the city reserves the right to decline to give preliminary and final approval to the issuance of
the bonds. The city retains the right in its sole discretion to withdraw from participation and
accordingly not to issue the bonds should the city at any time prior to issuance thereof
determine that it is in the best interests of the city not to issue the bonds or should the parties
to the transaction be unable to reach agreement as to the terms and conditions of any of the
documents required for this bond financing transaction.
Section 4. The borrower shall pay to the city any and all costs incurred by the city in
connection with the QCT preservation letter, the bonds or the financing of the project, whether
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or not the financing of the project is carried to completion, and whether or not the bonds, if
approved by the city, or operative instruments are executed and delivered.
Section 5. This resolution shall be in full force and effect from and after its passage.
Reviewed for administration: Adopted by the city council November 17, 2025:
Kim Keller, city manager Nadia Mohamed, mayor
Attest:
Melissa Kennedy, city clerk
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