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HomeMy WebLinkAbout89-106 - ADMIN Resolution - City Council - 1989/07/31RESOLUTION NO. 89-106 RESOLUTION AUTHORIZING A PROJECT UNDER MINNESOTA STATUTES, SECTIONS 469.152-469.165, AND THE SALE AND ISSUANCE OF NURSING HOME REVENUE BONDS (SHOLOM HOME WEST PROJECT), SERIES 1989 AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE BONDS AND NECESSARY DOCUMENTS. BE IT RESOLVED by the City Council of the City of St. Louis Park, Minnesota (the City), as follows: Section 1. Authorization and Recitals. 1.01. General Authority. The City is authorized by Minnesota Statutes, Sections 469.152-469.165 (the "Act") to issue revenue bonds for the purpose of defraying the cost of acquiring or improving projects consisting of real and personal properties suitable for use as health care facilities and to loan the proceeds of such bonds to others to pay such costs upon such terms and conditions as the governing body of the City shall deem advisable and as shall not conflict with the provisions of the Act. 1.02. Proposed Project and Bonds. Representatives of Minneapolis Federation For Jewish Service (the Borrower) have proposed that the City, acting under and pursuant to the Act, issue and sell its Nursing Home Revenue Bonds (Sholom Home West Project), Series 1989, in an aggregate principal amount of $8,000,000 (the "Bonds"), for the purpose of defraying the costs of constructing and equipping a building and related improvements (the "Project") suitable for and to be used as a nursing home. Pursuant to the proposal, the proceeds of the Bonds will be loaned by the City to the Borrower, and the Borrower will agree to donate the proceeds (less amounts to pay costs of issuance of the Bonds and capitalized interest on the Bonds) to Sholom Home West, Inc. (the "Project Owner"). The Project Owner will apply such proceeds to the payment of costs of the Project. The Borrower will agree to make payments sufficient to pay the principal of, premium, if any, and interest on the Bonds when due. The Bonds are subject to mandatory purchase on August 1, 1994. The purchase price payable on said date and princi.pal._and interest payable -on the Bonds on said date or prior thereto are secured by an irrevocable letter of credit issued by Norwest Bank Minnesota, National Association (the "Bank"). The City will grant a security interest in certain revenues and payments to be received by the City under the Loan Agreement (as hereinafter defined) to a Trustee (as hereinafter defined) and the Project Owner will be obligated to pay all costs of the Project in excess of the Bond proceeds available therefor. 1.03. Public Hearing and Prior Approval. At a public hearing, duly noticed and held on July 10, 1989, in accordance with Section 147(f) of the Internal Revenue Code of 1986, as -1- amended (the "Code") on the proposed issuance of the Bonds, all parties who appeared at the hearing were given an opportunity to express their views with respect to the issuance of the Bonds. On July 10, 1989, this Council gave preliminary approval to the Project and the issuance of the Bonds. 1.04. Documentation. Forms of the following documents relating to the Project and the Bonds have been prepared and submitted to this Council and are hereby directed to be filed in the office of the City Clerk: (a) A Loan Agreement (the "Loan Agreement"), to be dated as of August 1, 1989, proposed to be made and entered into between the City and First Trust National Association, as trustee (the "Trustee"); (b) An Indenture of Trust (the "Indenture") to be dated as of August 1, 1989, proposed to be made and entered into between the City and First Trust National Association, as trustee (the "Trustee"); (c) A Bond Purchase Agreement (the "Bond Purchase Agreement"), to be dated August 1, 1989, proposed to be made and entered into among Miller & Schroeder Financial, Inc. (the "Purchaser"), the Project Owner, the City and the Borrower; (d) A Project Agreement (the "Project Agreement"), to be dated as of August 1, 1989, proposed to be made and entered into between the Borrower, the Project Owner, and the Trustee; (e) A Letter of Credit and Reimbursement Agreement (the "Reimbursement Agreement"), to be dated as of August 1, 1989, proposed to be made and entered into between the Borrower and the Bank; (f) A Pledge and Security Agreement (the "Pledge Agree- ment"), to be dated as of August 1, 1989, proposed to be made and entered into between the Borrower and the Bank; (g) A Remarketing Agreement (the "Remarketing Agreement"), to be dated as of August 1, 1989, proposed to be made and entered into among the Borrower, the Trustee and the Purchaser; and (h) An Official Statement dated July 25, 1989 (the "Official Statement") containing certain information regarding the City, the Borrower, the Project Owner, the Project and the documents set forth above, whereby the Purchaser will offer the Bonds to investors. -2- Section 2. Findings. It is hereby found, determined and declared that: (a) the Project comprises real and personal properties which shall be suitable for use in connection with a nursing home as contemplated by the Act; (b) in authorizing the Project the City's purpose is, and in its judgment the effect thereof will be, to promote the public welfare by encouraging the location of a nursing home in the City, thereby encouraging the development and use of the available resources of the City, Hennepin County, and the State; improving employment opportunities of present and future residents of the City; providing necessary nursing home facilities and stimulating renewal and redevelopment of the area; (c) the acquisition and construction of the Project, the issuance and sale of the Bonds, the execution and delivery of the Loan Agreement, the Indenture and the Bond Purchase Agreement and the performance of all covenants and agreements of the City contained in the Loan Agreement, the Indenture and the Bond Purchase Agreement and of all other acts and things required under the Constitution and laws of the State of Minnesota to make the Loan Agreement, the Indenture and the Bond Purchase Agreement and the Bonds valid and binding obligations in accordance with their terms, are authorized by the Act; (d) the issuance and sale of the Bonds, the acquisition and construction of the Project and the financing of the Project by the City for the benefit_of__the-project Owner is in the public interest of the City and its citizens; (e) it is desirable that the Project Owner be authorized, subject to the terms and conditions set forth in the Project Agreement, which terms and conditions the City determines to be necessary, desirable and proper, to provide for the acquisition, construction and equipping of the Project by such means as shall be available to the Project Owner and in the manner determined by the _PrDject Owner, -and -with -or without advertisement for bids as required for the acquisition and construction of municipal facilities; (f) it is desirable that the Bonds be issued by the City upon the terms set forth in the Indenture, under the provisions of which the City grants to the Trustee a security interest in certain revenues and payments to be received by the City under the Loan Agreement as security for the payment of the principal of, premium, if any, and interest on the Bonds; -3- (g) the loan repayments contained in the Loan Agreement will produce income and revenue sufficient to provide for prompt payment of principal of and interest on all Bonds issued under the Indenture when due; and the Project Agreement provides that the Project Owner is required to pay all expenses of the operation and maintenance of the Project, including, but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising -from the operation thereof, and all taxes and special assessments levied upon or with respect to the site of the Project and payable during the term of the Loan Agreement; (h) the execution and delivery of the Loan Agreement, the Indenture and the Bond Purchase Agreement will not conflict with, or constitute on the part of the City a breach of or a default under, any existing agreement, indenture, mortgage, lease or other instrument to which the City is subject or is a party or by which it is bound; provided that this finding is made solely for the purpose of estopping the City from denying the validity of the Loan Agreement, the Indenture or the Bond Purchase Agreement by reason of the existence of any facts contrary to this finding; (i) no litigation is pending or, to the best knowledge of the members of this Council, threatened against the City questioning the organization or boundaries of the City or the right of any officer of the City to hold his or her office, or in any manner questioning the right and power of the City to execute and deliver the Bonds, or otherwise questioning the validity of the Bonds or the execution, delivery or validity of the Loan Agreement, the Indenture or the Bond Purchase Agreement, or questioning the appropriation of revenues to payment of the Bonds or the right of the City to loan the proceeds of the Bonds to the Borrower; (j) all acts and things required under the Constitution and the laws of the State of Minnesota to make the Loan Agreement, the Indenture and the Bond Purchase Agreement the valid and binding obligations of the City in accordance with their terms -will have been done -upon adoption of this Resolution and execution of the Loan Agreement, the Indenture and the Bond Purchase Agreement; provided that this finding is made solely for the purpose of estopping the City from denying the validity of the Loan Agreement, the Indenture and the Bond Purchase Agreement by reason of the existence of any facts contrary to this finding; (k) under the provisions of the Act and as provided in the Loan Agreement and Indenture and stated on the face of the Bonds, the Bonds are limited obligations of the City payable solely from loan repayments from the Borrower (except to the extent payable from proceeds of the sale or condemnation of -4- r 1 the Project or insurance proceeds therefrom) and do not constitute a pecuniary liability of the City or a charge against its general credit or taxing powers; and (1) the City is duly organized and existing under the Constitution and laws of the State of Minnesota and is authorized to issue the Bonds in accordance with the Act. Section 3. Authorization and Approval of the Project and Documents. The City is hereby authorized to finance part or all of the costs of the Project as presently estimated under Section 1.04, and to pledge and assign the Loan Agreement and the loan repayments due thereunder, all as provided in the Loan Agreement, the Indenture and the Bond Purchase Agreement. The forms of the Loan Agreement, the Indenture and the Bond Purchase Agreement referred to in Section 1.05 are approved subject to such modifications as are deemed appropriate and approved by the City Attorney and the Mayor, which approval shall be conclusively evidenced by execution of the Loan Agreement, the Indenture, the Bond Purchase Agreement and the Bonds by the Mayor and the City Manager. The Mayor and City Manager are directed to execute the Loan Agreement, the Indenture and the Bond Purchase Agreement. The City authorizes the distribution of the Official Statement to prospective purchasers of the Bonds with such variations, insertions and additions as the Mayor or City Attorney may deem appropriate. - Copies of all of the documents shall be delivered, - filed and recorded as provided therein. The Mayor, the City Manager and the City Clerk are also authorized and directed to execute such other instruments as may be required to give effect to the transactions herein contemplated. Section 4. The Bonds. 4.01. Terms; Sale. The City hereby authorizes the issuance of the Bonds in an aggregate principal amount not to exceed $8,000,000, in the form and upon the terms set forth in the Indenture and this Resolution. The Bonds are hereby sold to the Purchaser at a price not less than 100 percent of the principal amount hereof and upon the terms contained in the Bond Purchase Agreement. 4.02. Execution. The Mayor, the City Manager and, where required, the City Clerk are hereby authorized and directed to execute the Bonds as prescribed herein and in the Indenture and to deliver them to the Trustee, together with a certified copy of this Resolution, the other documents required in the Indenture, and such other certificates, documents and instruments as may be appropriate to effect the transactions herein contemplated. 4.03. Modifications, Absence of Officers. The approval hereby given to the various documents referred to above includes an approval of such modifications thereto, deletions therefrom and additions thereto as may be necessary and appropriate and approved by the City Attorney and the Mayor prior to the execution of the documents. The execution of any instrument by the appropriate officer or officers of the City herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. In the absence or disability of the Mayor, any of the documents authorized by this Resolution to be executed may be executed by the acting Mayor, and in the absence or disability of the City Manager by such officer of the City who, in the opinion of the City Attorney, may execute such documents. Section 5. Authentication of Proceedings. The Mayor, City Manager and other officers of the City are authorized and directed to furnish to the Purchaser and bond counsel certified copies of all proceedings and records of the City relating to the Bonds, and such other affidavits and certificates as may be required to show the facts relating to the legality and marketability of the Bonds as such facts appear from the books and records in the officer's custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the City as to the truth of all statements contained therein. Section 6. Qualified Tax -Exempt Obligations. The City hereby determines and declares that the City does not reasonably anticipate to issue in calendar year 1989 tax- exempt obligations in an aggregate principal amount greater than $10,000,000 (exclusive of "private activity bonds" as defined in the Code). The City hereby specifically designates the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265 of the Code, and covenants that it will-not—in---any event designate in calendar year 1989 more than $10,000,000 of its obligations as such "qualified tax-exempt obligations." Section 7. Effective Date. This Resolution shall be effective immediately upon its final adoption. Reviewed for Administration: PwaiMA- City Manager Adopted by the City Council July 31,-1189. Approved as to form and execution: