Loading...
HomeMy WebLinkAbout15-091 - ADMIN Resolution - City Council - 2015/07/06RESOLUTION NO. 15-091 RESOLUTION AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF THE CITY'S REVENUE BONDS FOR THE BENEFIT OF JONES-HARRISON RESIDENCE, WHICH SHALL BE PAYABLE SOLELY FROM REVENUES PLEDGED PURSUANT TO THE INDENTURE AND THE LOAN AGREEMENT; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE REVENUE BONDS AND RELATED DOCUMENTS WHEREAS, the City of St. Louis Park, Minnesota (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; and WHEREAS, Minnesota Statutes, Chapter 462C, as amended (the "Housing Act"), authorizes a municipality to carry out the public purposes described in the Housing Act by providing for the issuance of revenue bonds to provide funds to finance or refinance multifamily housing developments (including nursing and assisted living facilities), and WHEREAS, Minnesota Statutes, Section 471.656, as amended, authorizes a municipality to issue obligations to finance or refinance the acquisition or improvement of property located outside of the corporate boundaries of such municipality if the obligations are issued under a joint powers agreement between the municipality issuing the obligations and the municipality in which the property to be acquired or improved is located, and WHEREAS, pursuant to Minnesota Statutes, Section 471.59, as amended, by the terms of a joint powers agreement entered into through action of their governing bodies, two municipalities may jointly or cooperatively exercise any power common to the contracting parties or any similar powers, including those which are the same except for the territorial limits within which they may be exercised and the joint powers agreement may provide for the exercise of such powers by one or more of the participating governmental units on behalf of the other participating units; and WHEREAS, on September 28, 2005, the City of Minneapolis (the "City of Minneapolis") issued its Health Care Facilities Revenue Bonds (Jones -Harrison Residence Project), Series 2005 (the "Series 2005 Bonds"), in the original aggregate principal amount of $14,030,000, and loaned the proceeds thereof to Jones -Harrison Residence, a Minnesota nonprofit corporation (the "Corporation"), to (i) refinance the Corporation's 163 -bed skilled nursing facility and 57 -unit assisted living facility located at 3700 Cedar Lake Avenue in the City of Minneapolis (the "Facilities") by refunding the Health Care Facilities Revenue Bonds (Jones -Harrison Residence Project), Series 1998, issued by the City of Minneapolis in the original aggregate principal amount of $10,000,000; (ii) finance various capital improvements to the assisted living facility; (iii) fund a reserve fund for the Series 2005 Bonds; and (iv) pay the costs of issuance of the Series 2005 Bonds, and WHEREAS, the Corporation has requested that the City issue its health care facilities revenue refunding bonds, in one or more series, as taxable or tax-exempt obligations (the "Bonds"), in an aggregate principal amount not to exceed $13,000,000, for the purposes of (i) refinancing the Facilities through the redemption and prepayment of the outstanding Series 2005 Bonds; (ii) funding a debt service reserve fund for the Bonds, and (iii) paying costs of issuance of the Bonds, and Resolution No. 15-091 -2- WHEREAS, the City and the City of Minneapolis are proposing to enter into a Cooperative Agreement, to be dated on or after August 1, 2015 (the "Cooperative Agreement"), pursuant to which the City of Minneapolis will consent to the issuance of the Bonds by the City to refinance the Facilities, and the City will agree to issue the Bonds to refinance the Facilities; and WHEREAS, the Community Development and Regulatory Services Committee of the Minneapolis City Council conducted a duly noticed public hearing on June 23, 2015, on the issuance of the Bonds by the City to refinance the Facilities; and WHEREAS, the Minneapolis City Council will meet on July 10, 2015, to approve the issuance of the Bonds by the City to refinance the Facilities and to authorize the execution and delivery of the Cooperative Agreement, and WHEREAS, in accordance with the Housing Act, the City has prepared a housing program (the "Housing Program"), which authorizes the issuance of the Bonds by the City to refinance the Facilities, and the Housing Program was submitted to the Metropolitan Council for its review and comment; and WHEREAS, the Corporation has represented to the City that it is exempt from federal income taxation under Section 501(a) of the Internal Revenue Code of 1986, as amended (the "Code"), as a result of the application of Section 501(c)(3) of the Code; and WHEREAS, Section 147(0 of the Code, and regulations promulgated thereunder, and Section 462C 04 of the Housing Act require that prior to the issuance of the Bonds, the City Council approve the issuance of the Bonds after conducting a public hearing thereon preceded by publication of a notice of public hearing (in the form required by Section 147(0 of the Code and applicable regulations) in a newspaper of general circulation within the City at least fifteen (15) days prior to the public hearing date; and WHEREAS, a notice of public hearing (the "Public Notice") was published at least fifteen (15) days before the regularly scheduled meeting of the City Council of the City in the Sun -Sailor, the official newspaper and a newspaper of general circulation in the City, with respect to the required public hearing under Section 147(0 of the Code and the Housing Act; and WHEREAS, on the date hereof, the City Council conducted a duly noticed public heanng at which a reasonable opportunity was provided for interested individuals to express their views, both orally and in writing, on the following issues: (i) approval of the issuance of the Bonds pursuant to the requirements of Section 147(0 of the Code and the regulations promulgated thereunder; and (ii) approval of the Housing Program pursuant to the requirements of the Housing Act, and WHEREAS, the Bonds are to be issued by the City pursuant to the Housing Act, Minnesota Statutes, Section 471.59, and an Indenture of Trust, to be dated on or after August 1, 2015 (the "Indenture"), between the City and U.S. Bank National Association, as trustee (the "Trustee"), and the City will loan the proceeds of the Bonds to the Corporation pursuant to a Loan Agreement, to be dated on or after August 1, 2015 (the "Loan Agreement"), between the City and the Corporation, and • • Resolution No 15-091 -3- WHEREAS, the principal, premium (if any), and interest on the Bonds (1) shall be payable solely from the revenue pledged therefor; (ii) shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation; (iii) shall not constitute nor give rise to a pecuniary liability of the City or a charge against its general credit or taxing powers; and (iv) 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 Loan Agreement; and WHEREAS, the Loan Agreement requires the Corporation to make payments thereunder in amounts and at times sufficient to pay the principal of, premium (if any), and interest on the Bonds when due, and the loan repayments required to be made by the Corporation to the City under the terms of the Loan Agreement will be assigned by the City to the Trustee to secure the payment of the principal of, premium (if any), and interest on the Bonds, and WHEREAS, to secure its obligations under the Loan Agreement, the Corporation will provide a mortgage lien on and a secured interest in certain of its property to the Trustee pursuant to an Amended and Restated Mortgage Agreement, to be dated on or after August 1, 2015 (the "Mortgage"), and WHEREAS, Jones -Harrison Foundation, a Minnesota nonprofit corporation (the "Guarantor"), is expected to deliver a Guaranty Agreement, to be dated on or after August 1, 2015 (the "Guaranty"), as additional security for the Corporation's obligations under the Loan Agreement; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ST. LOUIS PARK, MINNESOTA, AS FOLLOWS: 1. The Housing Program, in the form substantially on file with the City, is hereby approved 2 For the purposes set forth above, there is hereby authorized the issuance, sale, and delivery of the Bonds in the aggregate pnncipal amount not to exceed $13,000,000. The Bonds shall bear interest, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, shall be in such form, and shall have such other terms, details, and provisions as are prescribed in the Indenture, in substantially the form now on file with the City 3. All of the provisions of the Bonds, when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof The Bonds shall be substantially in the form on file with the City, which is hereby approved, with such necessary and appropriate variations, omissions, and insertions (including changes to the principal amount of the Bonds, the determination of the interest rates on the Bonds, and changes to the terms of redemption of the Bonds) as the Mayor and the City Manager of the City (the "Mayor" and "City Manager," respectively), in their discretion, shall determine. The execution of the Bonds with the manual or facsimile signatures of the Mayor and the City Manager and the delivery of the Bonds by the City shall be conclusive evidence of such determination 4 The Bonds shall be special, limited obligations of the City payable solely from the revenues provided by the Corporation pursuant to the Loan Agreement and other funds pledged pursuant to the Indenture and shall be issued in an aggregate principal amount not to exceed $13,000,000. The City Council of the City hereby authorizes and directs the Mayor and the City Resolution No 15-091 -4- Manager to execute and deliver the Indenture to the Trustee, hereby authorizes and directs the execution of the Bonds in accordance with the terms of the Indenture, and hereby provides that the Indenture shall provide the terms and conditions, covenants, rights, obligations, duties, and agreements of the owners of the Bonds, the City and the Trustee as set forth therein 5 All of the provisions of the Indenture, when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Indenture shall be substantially in the form on file with the City, which is hereby approved, with such necessary and appropriate variations, omissions, and insertions as do not materially change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution thereof by the Mayor and the City Manager shall be conclusive evidence of such determination 6. The Mayor and the City Manager are hereby authorized and directed to execute and deliver the Loan Agreement, the Cooperative Agreement, and the Bond Purchase Agreement, to be dated after the date hereof (the "Bond Purchase Agreement"), between the City, the Corporation, and Northland Securities, Inc., as the original purchaser of the Bonds (the "Underwriter"). All of the provisions of the Loan Agreement, the Cooperative Agreement, and the Bond Purchase Agreement, when executed and delivered as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Loan Agreement, the Cooperative Agreement, and the Bond Purchase Agreement shall be substantially in the forms on file with the City which are hereby approved, with such omissions and insertions as do not matenally change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution thereof by the Mayor and the City Manager shall be conclusive evidence of such determination 7 The Bonds shall be revenue obligations of the City the proceeds of which shall be disbursed pursuant to the Indenture and the Loan Agreement, and the principal, premium, if any, and interest on the Bonds shall be payable solely from the proceeds of the Bonds, the revenues derived from the Loan Agreement, the revenues and assets pledged and assigned under the terms of the Mortgage and the other sources set forth in the Indenture. The Trustee is hereby authorized and directed to accept from the Corporation any additional instruments, documents, or other security provided by the Corporation, at its direction, to secure the obligations of the Corporation under the Loan Agreement and Mortgage or to secure the Bonds, including but not limited to the Guaranty 8. The Trustee is hereby appointed as Paying Agent and Bond Registrar for the Bonds. 9. The Mayor and the City Manager are hereby authorized to execute and deliver, on behalf of the City, such other documents as are necessary or appropriate in connection with the issuance, sale, and delivery of the Bonds, including one or more certificates of the City, an endorsement to the Corporation's Tax Certificate, an Information Return for Tax -Exempt Private Activity Bond Issues, IRS Form 8038 (Rev April 2011), and all other documents and certificates as shall be necessary and appropriate in connection with the issuance, sale, and delivery of the Bonds. The City hereby approves the execution and dehvery by the Trustee of the Indenture and all other instruments, certificates, and documents prepared in conjunction with the issuance of the Bonds that require execution by the Trustee. The City hereby authorizes Kennedy & Graven, Resolution No. 15-091 -5- Chartered, as bond counsel of the City, to prepare, execute, and deliver its approving legal opinion with respect to the Bonds. 10. The City has not participated in the preparation of the Preliminary Official Statement (the "Preliminary Official Statement") or the Official Statement (the "Official Statement") relating to the Bonds and has made no independent investigation with respect to the information contained therein, including the appendices thereto, and the City assumes no responsibility for the sufficiency, accuracy, or completeness of such information. Subject to the foregoing, the City hereby consents to the distribution and the use by the Underwriter in connection with the sale of the Bonds of the Preliminary Official Statement and the Official Statement The Preliminary Official Statement and the Official Statement are the sole materials consented to by the City for use in connection with the offer and sale of the Bonds. The City hereby approves the Continuing Disclosure Agreement, to be dated on or after August 1, 2015 (the "Disclosure Agreement"), between the Corporation and U.S. Bank National Association, as the dissemination agent (the "Dissemination Agent"), in the form now on file with the City, and hereby authorizes the Dissemination Agent to execute and deliver the Disclosure Agreement. 11. All covenants, stipulations, obligations, and agreements of the City contained herein and in the aforementioned documents shall be deemed to be the covenants, stipulations, obligations, and agreements of the City to the full extent authorized or permitted by law, and all such covenants, stipulations, obligations, and agreements shall be binding upon the City Except as otherwise provided herein, all rights, powers, and privileges conferred and duties and liabilities imposed upon the City or the City Council by the provisions of this resolution or of the aforementioned documents shall be exercised or performed by the City or by such members of the City Council, or such officers, board, body or agency thereof as may be required or authorized by law to exercise such powers and to perform such duties. No covenant, stipulation, obligation or agreement herein contained or contained in the aforementioned documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the City Council of the City, or any officer, agent or employee of the City in that person's individual capacity, and neither the City Council of the City nor any officer or employee executing the Bonds shall be liable personally on the Bonds or be subject to any personal liability or accountability by reason of the issuance thereof No provision, covenant or agreement contained in the aforementioned documents, the Bonds or in any other document relating to the Bonds, and no obligation therein or herein imposed upon the City or the breach thereof, shall constitute or give rise to any pecuniary liability of the City or any charge upon its general credit or taxing powers In making the agreements, provisions, covenants, and representations set forth in such documents, the City has not obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Loan Agreement and the Mortgage, which are to be applied to the payment of the Bonds, as provided therein and in the Indenture. 12 Except as herein otherwise expressly provided, nothing herein or in the aforementioned documents expressed or implied, is intended or shall be construed to confer upon any person or firm or corporation, other than the City or any holder of the Bonds issued under the provisions of this resolution, any right, remedy or claim, legal or equitable, under and by reason of this resolution or any provisions hereof, this resolution, the aforementioned documents and all of their provisions being intended to be and being for the sole and exclusive benefit of the City and any holder from time to time of the Bonds issued under the provisions of this resolution. Resolution No. 15-091 -6- 13. In case any one or more of the provisions of this resolution, other than the provisions contained in the first sentence of Section 4 hereof, or of the aforementioned documents, or of the Bonds issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this resolution, or of the aforementioned documents, or of the Bonds, but this resolution, the aforementioned documents, and the Bonds shall be construed and endorsed as if such illegal or invalid provisions had not been contained therein 14 The Bonds, when executed and delivered, shall contain a recital that they are issued pursuant to the Housing Act, and such recital shall be conclusive evidence of the validity of the Bonds and the regularity of the issuance thereof, and that all acts, conditions, and things required by the laws of the State of Minnesota relating to the adoption of this resolution, to the issuance of the Bonds, and to the execution of the aforementioned documents to happen, exist and be performed precedent to the execution of the aforementioned documents have happened, exist and have been performed as so required by law. 15. The officers of the City, bond counsel, other attorneys, engineers, and other agents or employees of the City are hereby authorized to do all acts and things required of them by or in connection with this resolution, the aforementioned documents, and the Bonds for the full, punctual, and complete performance of all the terms, covenants, and agreements contained in the Bonds, the aforementioned documents and this resolution. In the event that for any reason the Mayor is unable to carry out the execution of any of the documents or other acts provided herein, any other member of the City Council of the City shall be authorized to act in his capacity and undertake such execution or acts on behalf of the City with full force and effect, which execution or acts shall be valid and binding on the City. If for any reason the City Manager is unable to execute and deliver the documents referred to in this resolution, such documents may be executed by a member of the City Council, with the same force and effect as if such documents were executed and delivered by the City Manager. 16 The City understands that the Corporation will pay directly to the City any and all costs paid or incurred by the City in connection with the transactions authorized herein, whether or not the Bonds are issued The City further understands that the Corporation will pay to the City its administrative fee for the issuance of conduit debt. 17 This resolution shall be in full force and effect from and after its passage. Reviewe• fo Ad istration: .1J.�, City Manner Attest: Adopted by the City Council July 6, 2015