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HomeMy WebLinkAbout01-060 - ADMIN Resolution - City Council - 2001/07/16RESOLUTION NO. 01-060 0 GRANTING PRELIMINARY AUTHORIZATION TO THE ISSUANCE, SALE AND DELIVERY OF MULTIFAMILY HOUSING REVENUE REFUNDING BONDS (NEWPORT ON SEVEN PROJECT), SERIES 2001A, IN THE AGGREGATE AMOUNT OF $10,124,832, AND TAXABLE MULTIFAMILY HOUSING REVENUE BONDS (NEWPORT ON SEVEN PROJECT), SERIES 2001B, IN THE AGGREGATE AMOUNT OF 2,800,000; APPROVING THE FORM OF AND AUTHORIZING AN AMENDMENT TO A BOND RESOLUTION, DATED AS OF AUGUST 1,1986, WITH RESPECT TO THE MULTIFAMILY MORTGAGE REVENUE BONDS (WALKER PLACE APARTMENTS PROJECT), SERIES 1986; AND AUTHORIZING CERTAIN OTHER ACTIONS WITH RESPECT TO SUCH BONDS WHEREAS, the City of St. Louis Park, Minnesota (the "City") is a home rule city and political subdivision duly organized and existing under its charter and the Constitution and laws of the State of Minnesota; and WHEREAS, pursuant to the Constitution and laws of the State of Minnesota, particularly Minnesota Statutes, Chapter 462C, as amended (the "Act"), the City has heretofore issued its Multifamily Mortgage Revenue Bonds (Walker Place Apartments Project), Series 1986 (the "Pnor Bonds"), in the onginal aggregate pnncipal amount of $10,124,832, pursuant to a Bond Resolution, dated as of August 1, 1986 (the "Bond Resolution"); and WHEREAS, by a Loan Agreement, dated as of August 1, 1986 (the "Pnor Loan Agreement"), between the City and St Louis Park Housing Partners, A Limited Partnership, a Minnesota limited partnership (the "Borrower"), the City agreed to lend the proceeds derived from the sale of the Prior Bonds to the Borrower to finance a 167 -unit multifamily rental housing development located at 7450 Highway 7 in the City (the "Project"), and the Borrower agreed to repay the loan at times and in amounts sufficient to pay the pnncipal of and interest on the Prior Bonds when due, and WHEREAS, the Pnor Bonds remain outstanding in the pnncipal amount of $10,124,832 and are subject to redemption and prepayment at the option of the Borrower; and WHEREAS, the Borrower proposes to refund the Prior Bonds and, for that purpose, has requested the City to issue its Multifamily Housing Revenue Refunding Bonds (Newport on Seven Apartments Project) Series 2001A (the "Series 2001A Bonds"), in an aggregate principal amount not to exceed $10,124,832, and the Borrower proposes to finance the costs of the proposed refunding and other transaction costs and the costs of certain capital improvements to the Project (the "Additional Costs") and, for that purpose, has requested the City to issues its Taxable Multifamily Housing Revenue Bonds (Newport on Seven Apartments Project) Senes 2001B (the "Senes 2001B Bonds"), in an aggregate principal amount not to exceed $2,800,000 (the Series 2001A Bonds and the Series 2001B Bonds are hereinafter referred to collectively as the "Bonds"), and WHEREAS, the Bonds and the interest on the Bonds shall be payable solely from the revenue pledged therefor and the Bonds shall not constitute a debt of the City within the meaning of any constitutional, statutory, or charter imitation nor give rise to a pecuniary liability of the City or a charge against its general credit, assets, or taxing powers, and shall not constitute a charge, lien, or encumbrance, legal or equitable, upon any property of the City other than the City's interest in the Project; and Resolution No 01-060 -2- WHEREAS, a supplement and amendment to the Bond Resolution is necessary to ensure that the Pnor Bonds can be redeemed and prepaid with the proceeds of the Bonds and such supplement and amendment must be approved by the Borrower and the owners of the Prior Bonds, NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ST. LOUIS PARK, MINNESOTA, AS FOLLOWS: Section 1. The City acknowledges, finds, determines, and declares that the City is authonzed by the Act to issue the Bonds and it is in the public interest that the City issue the Bonds under the terms and conditions specified in the Indenture. Section 2. For the purpose of refunding the Pnor Bonds and financing the Additional Costs of the Project, the City hereby grants preliminary authonzation to the issuance of the Bonds. Such preliminary authorization is subject to the mutual agreement of the City, the Borrower, and any credit enhancer, trustee, guarantor, or other party to such financing as to the details of the Bonds and the provisions for their payment. In all events, it is understood, however, that the Bonds shall not constitute a charge, hen, or encumbrance, legal or equitable, upon any property of the City (except the interests of the City in the Project), 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 Borrower and the Project and any additional secunty provided by the Borrower and pledged to the payment thereof. The Bonds are to be special limited obligations of the City and do not constitute general obligations or moral obligations of the City and are not secured by the full faith and credit of the City, any taxing power of the City, or any other property or assets of the City (except the interest of the City in the Project). Section 3. The Bonds may be issued with a different name or series designation than set forth in this resolution (the "Resolution") and may be issued in greater or lesser aggregate pnncipal amounts than are set forth in this Resolution. The proceeds of the Bonds may be applied to purposes not expressly set forth in this Resolution. Section 4. In order to facilitate the redemption and prepayment and refunding of the Pnor Bonds, Section 4.04(a) of the Bond Resolution is amended to read as set forth below and, in this regard, this Resolution shall constitute a "supplemental resolution" within the meaning of Section 12 02 of the Bond Resolution. Section 4 04 Mandatory Remarketing or Redemption of Bonds on each Remarketing Date (a) Subject to the further provisions of this Section, the Bonds are subject to mandatory redemption or purchase and the Issuer shall cause the Bonds to be redeemed or purchased prior to matunty on each Remarketing Date for a price equal to the principal amount thereof, plus unpaid interest payable through and including such date The initial Remarketing Date shall be the latest Business Day pnor to the earliest of (i) December 31, 2001, (ii) any earlier Interest Payment Date occurring on or after the thirteenth anniversary of the date of initial delivery of the Bonds selected by the Bondholder in its absolute discretion, notice of which is given to the Issuer and the Developer not less than six months pnor to such date, and (iii) any date selected by the Developer on which the Bonds may be redeemed in whole in connection with the prepayment in Resolution No 01-060 -3- whole of the Loan at the option of the Developer pursuant to Section 4.05 of the Agreement, notice of which has been given to the Issuer and the Bondholder not later than the time for giving notice of such prepayment provided in the Agreement. Except as set forth above, the Bond Resolution shall remain unamended and in full force and effect in accordance with its terms until the Pnor Bonds are redeemed, prepaid, and refunded. Section 4 The amendment of the Bond Resolution pursuant to this Resolution is not effective until such amendment is approved by the Borrower and the owner of the Pnor Bonds (the "Bondholder") The Bond Resolution Amendment Agreement, to be dated as of July 1, 2001 (the "Agreement"), between the City, the Borrower, and the Bondholder, pursuant to which the Borrower and the Bondholder approve the amendment to the Bond Resolution, is hereby approved in the form now, on file with the City. The Mayor and the City Manager are authorized and directed to execute and deliver the Agreement and any and all certificates, agreements, or other documents which are required by the Agreement, or any other certificates or documents which are deemed necessary by bond counsel to evidence the validity or enforceability of the Pnor Bonds, the Agreement, or the other documents referred to in this Resolution, or to evidence compliance with applicable provisions of the Internal Revenue Code of 1986, as amended, and all such agreements or representations when made shall be deemed to be agreements or representations, as the case may be, of the City. The Mayor and the City Manager are hereby designated and authonzed to take such other administrative action as is permitted or required by the Agreement Section 5. Except as herein otherwise expressly provided, nothing in this Resolution or in the Agreement, expressed or implied, is intended or shall be construed to confer upon any person, firm, or corporation other than the City, the Bondholder, and the Borrower any nght, remedy, or claim, legal or equitable, under and by reason of this Resolution or any provision hereof or of the Agreement or any provision thereof; this Resolution, the Agreement and all of their provisions being intended to be and being for the sole and exclusive benefit of the City, the Borrower, and the Bondholder from time to time of the Prior Bonds issued under the provisions of the Bond Resolution. Section 6. In case any one or more of the provisions of this Resolution, of the Agreement or of the Prior Bonds shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this Resolution, of the Agreement or of the Pnor Bonds, but this Resolution, the Agreement, and the Prior Bonds shall be construed as if such illegal or invalid provision had not been contained therein. Section 7. All acts, conditions, and things required by the laws of the State of Minnesota, relating to the adoption of this Resolution and to the execution and delivery of the Agreement to happen, exist, and be performed precedent to and in the enactment of this Resolution, and precedent to the execution of the Agreement have happened, exist, and have been performed as so required by law. Section 8. The City Council, officers of the City, and attorneys and other agents or employees of the City are hereby authonzed to do all acts and things required of them by or in connection with this Resolution and the Agreement and the other documents referred to therein for the full, punctual, and complete performance of all the terms, covenants, and agreements contained in the Agreement and this Resolution t ' Resolution No 01-060 -4- Section 9. This Resolution shall be in full force and effect from and after its passage. PASSED AND APPROVED this 16th day of July, 2001. CITY OF ST. LOUIS PARK, MINNESOTA Reviewed for Administration: Ad. : - , by the City Council July 16, 2001. 441-. itV City Manager Attest May 51.„--.4..---). /Cd -s—,,,,,--4-. ity Clerk • Resolution No 01-060 -5- BOND RESOLUTION AMENDMENT AGREEMENT This Bond Resolution Amendment Agreement is dated as of July 1, 2001 (the "Agreement"), and is entered into between the City of St. Louis Park, Minnesota, a home rule city and political subdivision of the State of Minnesota (the "City"), St. Louis Park Housing Partners, A Limited Partnership, a Minnesota limited partnership (the "Borrower"), and Municipal Mortgage & Equity, LLC, a Delaware limited liability company ("MuniMae"). WHEREAS, pursuant to the Constitution and laws of the State of Minnesota, particularly Minnesota Statutes, Chapter 462C, as amended (the "Act"), the City has heretofore issued its Multifamily Mortgage Revenue Bonds (Walker Place Apartments Project), Senes 1986 (the "Pnor Bonds"), in the onginal aggregate principal amount of $10,124,832, pursuant to a Bond Resolution, dated as of August 1, 1986 (the "Bond Resolution"); and WHEREAS, by a Loan Agreement, dated as of August 1, 1986 (the "Prior Loan Agreement"), between the City and the Borrower, the City loaned the proceeds derived from the sale of the Pnor Bonds to the Borrower to finance a 167 -unit multifamily rental housing development located at 7450 Highway 7 in the City (the "Project"), and the Borrower agreed to repay the loan at times and in amounts sufficient to pay the principal of and interest on the Pnor Bonds when due; and • WHEREAS, pursuant to the terms of the Bond Resolution, the Pnor Bonds are required to be purchased or redeemed on August 28, 2001, and • WHEREAS, the City and the Borrower have proposed to issue bonds (the "Refunding Bonds") to refund the Prior Bonds but such Refunding Bonds and related documents cannot be prepared and executed, and the Refunding Bonds cannot be sold on terms acceptable to the City and the Borrower, prior to August 28, 2001; and WHEREAS, the City Council of the City adopted a resolution on July 16, 2001 (the "Supplemental Resolution"), which constitutes a "supplemental resolution" (within the meaning of Section 12.02 of the Bond Resolution) that amends Section 4.04 of the Bond Resolution to extend the time to purchase or redeem the Prior Bonds to December 28, 2001, and WHEREAS, any supplemental resolution which amends the Bond Resolution must be approved by the Borrower and MuniMae (as owner of the Pnor Bonds); NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows: 1 Approval of Supplemental Resolution. The Borrower and MuniMae hereby approve the Supplemental Resolution and agree to an amendment of a portion of the definition of Remarketing Date (as such term is employed in the Bond Resolution) from the "latest Business Day pnor to the earliest of (i) the fifteenth anniversary of the date of initial delivery of the Bonds" to "the latest Business Day prior to the earliest of (i) December 31, 2001". Resolution No 01-060 -6- 2 Cooperation with respect to Reissuance Determination. In the event that Kennedy & Graven, Chartered, acting as bond counsel, determines that the amendment made to the Bond Resolution by the Supplemental Resolution constitutes a reissuance of the Pnor Bonds for federal income tax purposes under applicable provisions of the Internal Revenue Code of 1986, as amended (the "Code"), the City, the Borrower, and MuniMae agree to cooperate in taking all actions necessary to ensure that the interest on the Pnor Bonds will remain excludable from gross income for federal income tax purposes. Such actions may include the preparation, execution, and filing of an Information Return for Tax -Exempt Pnvate Activity Bond Issues, Form 8038 (Rev. December 2000), and the preparation, execution, and filing of one or more certificates relating to arbitrage and rebate matters under Section 148 of the Code, and the preparation and execution of agreements and certificates relating to compliance with other applicable provisions of the Internal Revenue Code of 1954, as amended, and the Code •