Loading...
HomeMy WebLinkAbout01-150 - ADMIN Resolution - City Council - 2001/12/17RESOLUTION NO. 01-150 • RESOLUTION RELATING TO A MULTIFAMILY HOUSING DEVELOPMENT TO BE ACQUIRED, CONSTRUCTED, OWNED AND OPERATED BY WEST SUBURBAN HOUSING PARTNERS VII, LIMITED. PARTNERSHIP, A MINNESOTA LIMITED PARTNERSHIP AND THE ISSUANCE OF REVENUE BONDS TO FINANCE THE COSTS THEREOF UNDER MINNESOTA STATUTES, CHAPTER 462C, AS AMENDED; GRANTING PRELIMINARY APPROVAL THERETO, ESTABLISHING COMPLIANCE WITH CERTAIN REIMBURSEMENT REGULATIONS UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, AND TAKING CERTAIN OTHER ACTIONS WITH RESPECT THERETO BE IT RESOLVED by the City Council of the City of St. Louis Park, Minnesota (the "City"), as follows. Section 1. Recitals. 1 01. The City of St. Louis Park, Minnesota is a home rule charter city 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 "Act"), the City is authorized to carry out the public purposes described in the Act by providing for the issuance of revenue bonds to provide funds to finance or refinance multifamily housing developments located within the City. As a condition to the issuance of such revenue bonds, the City must adopt a housing program providing the information required by Section 462C.03, subdivision la, of the Act (the "Housing Program") A public hearing must be held in accordance with the requirements of Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code") and the acquirements of the Act. The City Council of the City must also adopt one or more resolutions approving the Housing Program, granting preliminary approval to the issuance of icvenue bonds to finance the multifamily housing development referred to in the Housing Program, and authorizing the submission of an application to the Minnesota Department of Finance for an allocation of bonding authority with respect to the Project (as hereafter defined). 1 03. West Suburban Housing Partners VII, Limited Partnership, a Minnesota Limited Paitneiship (the "Borrower") has proposed that the City, pursuant to the Act, issue its revenue bonds in the approximate aggregate principal amount not to exceed $9,000,000, in one or more sciies at one time or from time to time (the "Bonds"), the proceeds of which will be loaned by the City to the Borrower to be applied by the Borrower to the acquisition and construction of an eighty-eight unit multifamily housing development known as "At the Park" (the "Project") located near the intersection of 36th Street and Phillips Parkway in the City (the "Project"). The Borrower will apply the proceeds of the loan to the acquisition costs of the Project, the costs the constiuction of the Pioject, and the payment of certain costs related to the issuance of the Bonds. 1 04. Under Section 147(0 of the Internal Revenue Code of 1986, as amended (the "Code"), prior to the issuance of the Bonds a public hearing duly noticed must be held by the City Council. Under Section 462C.04, subdivision 2, of the Act, a public hearing must be held on each housing program after one publication of notice in a newspaper circulating generally in the City, at least fifteen days before the hearing. Resolution No. 01-150 -2- 1 05 Under Section 146 of the Code, the Bonds must receive an allocation of the bonding authority of the State of Minnesota. An application for such an allocation must be made pursuant to the requirements of Minnesota Statutes, Chapter 474A, as amended (the "Allocation Act"). Section 2. Preliminary Findings'. Based on representations made by the Borrower to the City to date, the City Council of the City hereby makes the following preliminary findings, determinations, and declarations: (a) The Project consists of a multifamily housing development designed and intended to be used for rental occupancy (b) The proceeds of the Bonds will be 1oanxd to the Borrower and the proceeds of the loan will be applied to the acquisition of the Project, the construction of the Project, and the payment of costs related to the issuance of the Bonds. The City will enter into a loan agreement (or other revenue agreement) with the Borrower requiring loan repayments from the Borrower in amounts sufficient to repay the loan when due and requiring the Borrower to pay all costs of maintaining and insuring the Project, including taxes thereon. (c) In preliminarily authorizing the issuance of the Bonds and the financing of the construction of the Project and the related costs, the City's purpose is and the effect thereof will be to promote the public welfare of the City and its residents by retaining and improving multifamily housing developments and otherwise furthering the purposes and policies of the Act. (d) The issuance of the Bonds to finance all or a portion of the costs of the Project is in the public interest (e) The Bonds will be limited obligations of the City payable solely from the revenues pledged to the payment thereof, and will not be a general obligation of or be secured by the taxing power of the City. Section 4. Public Heanne. The City Manager or his designee is hereby authorized to establish a date for a public hearing to Ibe conducted at a regular meeting of the City Council of the City in conformity with the requirements of Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code") and the requirements of the Act. The City Council will conduct the public heanng with respect to. (i) the approval of a Housing Program; and (ii) the approval of the issuance of the Bonds to finance the Project. It shall be the Borrower's responsibility to pay the costs of publication of a notice of the proposed public heanng in substantially the form attached hereto as EXHIBIT A in the official newspaper and in a newspaper of general circulation in the City once, at least fifteen days prior to the date of the public hearing. i I Section 5. Housing Program. The Housing Program shall be prepared by the Borrower and delivered to the City for its review�and approval. Upon approval of the Housing Program following the public hearing thereon, the City shall submit the Housing Program for review if required by the terms of the Act. Resolution No. 01-150 -3- Section 6. Preliminary Approval. This Council hereby gives preliminary approval to the issuance of the Bonds in the approximate aggregate principal amount not to exceed $9,000,000 to finance all or a portion of the costs of the Project pursuant to the Housing Program of the City, subject to final approval following the preparation of bond documents, and subject to final determination by this Council that the financing of the Project and the issuance of the Bonds are in the best interest of the City Section 7. Submission of an Application for an Allocation of Bonding Authority. Under Section 146 of the Code, the Bonds must receive an allocation of the bonding authority of the State of Minnesota An application for such an allocation must be made pursuant to the requirements of the Allocation Act. The City Council hereby authorizes the submission of an application for allocation of bonding authority pursuant to Section 146 of the Code and the Allocation Act in accordance with the requirements of the Allocation Act. The Mayor of the City, the City Manager, and Kennedy & Graven, Chartered, acting as bond counsel with respect to the Project and the Bonds, shall take all actions, in cooperation with the Borrower, as are necessary to submit an application for an allocation of bonding authority to the Minnesota Department of Finance. Section 8. Reimbursement of Costs under the Code. 8.1 The United States Department of the Treasury has promulgated final regulations governing the use of the proceeds of tax-exempt bonds, all or a portion of which are to be used to reimburse the City or a borrower from the City for project expenditures paid prior to the date of issuance of such bonds. Those regulations (Treasury Regulations, Section 1.150-2) (the "Regulations") require that the City adopt a statement of official intent to reimburse an original expenditure not later than sixty days after payment of the original expenditure. The Regulations also generally require that the bonds be issued and the reimbursement allocation made from the proceeds of the bonds occur within eighteen months after the later of: (i) the date the expenditure is paid; or (ii) the date the project is placed in service or abandoned, but in no event more than three years after the date the expenditure is paid. The Regulations generally permit reimbursement of capital expenditures and costs of issuance of the bonds. 8.2 To the extent any portion of the proceeds of the Bonds will be applied to expenditures with respect to the Pioject, the City reasonably expects to reimburse the Borrower for the expenditures made for costs of the Project from the proceeds of the Bonds after the date of payment of all or a portion of such expenditures All reimbursed expenditures shall be capital expenditures, a cost of issuance of the Bonds, or other expenditures eligible for reimbursement under Section 1.150-2(d)(3) of the Regulations and also qualifying expenditures under the Act. Based on representations by the Borrower, other than (i) expenditures to be paid or reimbursed from sources other than the Bonds, (ii) expenditures permitted to be reimbursed under prior regulations pursuant to the transitional provision contained in Section 1.150- 2(1)(2)(i)(B) of the Regulations, (iii) expenditures constituting preliminary expenditures within the meaning of Section 1.150-2(0(2) of the Regulations, or (iv) expenditures in a "de minimus" amount (as defined in Section 1.150-2(f)(1) of the Regulations), no expenditures with respect to the Project have been made by the Borrower more than sixty days before the date of adoption of this resolution. Resolution No. 01-150 -4- 8 3 Based on representations by the Borrower, as of the date hereof, there are no funds of the Borrower reserved, allocated on a long term -basis or otherwise set aside (or reasonably expected to be reserved, allocated on a long-term basis or otherwise set aside) to provide permanent financing for the expenditures related to the Project to be financed from proceeds of the Bonds, other than pursuant to the issuance of the Bonds. This resolution, therefore, is determined to be consistent with the budgetary and financial circumstances of the Borrower as they exist or are reasonably foreseeable on the date hereof Section 9. Costs. The Borrower will pay any administrative fees of the City and pay, or, upon demand, reimburse the City for payment of, any and all costs incurred by the City in connection with the Project and the issuance of the Bonds, whether or not the Bonds are issued. Section 10. Commitment Conditional. The adoption of this resolution does not constitute a guarantee or a firm commitment that the City will issue the Bonds as requested by the Borrower If, based on comments (received at a public heanng to be held pursuant to this resolution, or other information made available to or obtained by the City during its review of the Project, it appears that the Project or the issuance of Bonds to finance or refinance the costs thereof is not in the public interest or is inconsistent with the purposes of the Act, the City reserves the nght not to give final approval to the issuance of the Bonds. The City also retains the nght, in its sole discretion, to withdraw from participation and accordingly not issue the Bonds should the City Council, at any time prior to the 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 for the transaction Section 11. Effective Date. This Resolution shall be in full force and effect from and after its passage. Review d for Administration: Cit' Y Manager Attest. Ci ' Clerk Council December 17, 2001 May