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HomeMy WebLinkAbout22-083 - ADMIN Resolution - City Council - 2022/06/06Resolution No. 22-083 Resolution approving contract for private development and an interfund loan from the Affordable Housing Trust Fund for the Rise on 7 development 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; Approval and Authorization. 1.01. Recitals. (a) The City and the St. Louis Park Economic Development Authority (the “Authority”) have heretofore approved the establishment of the Rise on 7 Tax Increment Financing District (the “TIF District”), a housing district within Redevelopment Project No. 1 (the “Project”), and have adopted a tax increment financing plan for the purpose of financing certain improvements within the Project in accordance with Minnesota Statutes, Section 469.174 through 469.1794 (the “TIF Act”). (b) The City has heretofore created an Affordable Housing Trust Fund, which is funded in part with pooled tax increment derived from property within certain tax increment financing districts within the City as provided in Laws of Minnesota 2022, First Special Session, Chapter 14, Article 9, Section 5. The City is authorized to make loans from its Affordable Housing Trust Fund to provide funding for affordable housing developments in the City. (c) To facilitate the development of certain property within the Project and TIF District, the Authority, the City, and CB SLP Housing Limited Partnership, a Minnesota limited partnership (the “Developer”), have negotiated a Contract for Private Development (the “Agreement”) which provides for the construction by the Developer of an approximately 120-unit affordable rental housing facility, underground parking, and an early childcare center (the “Minimum Improvements”) on certain property legally described therein (the “Development Property”). The Agreement includes the provision of a deferred loan from the Authority in the principal amount of $1,800,000 (the “Deferred Loan”) to the Developer from proceeds of an interfund loan made from the City’s Affordable Housing Trust Fund to the Authority. The Deferred Loan will reimburse the Developer for certain costs of the Minimum Improvements including the costs of constructing affordable housing, demolition costs and costs of asbestos removal on the Development Property (the “Public Development Costs”). (d) The Authority may incur certain costs related to the TIF District, which costs may be financed on a temporary basis from available Authority funds. Under Section 469.178, subdivision 7 of the TIF Act, the Authority is authorized to advance or loan money from any fund from which such advances may be legally made in order to finance expenditures that are eligible to be paid with tax increments under the TIF Act. (e) The Authority has determined to pay for the Public Development Costs through the Deferred Loan, which costs may be financed on a temporary basis from Authority funds available for such purposes. DocuSign Envelope ID: 2FEDDF4B-154A-4EA5-94B5-7C6A4AAEF4B5 Resolution No. 22-083 2 (f) In order to finance the Public Development Costs, the Authority has requested that the City provide funds from the City’s Affordable Housing Trust Fund in the principal amount of up to $1,800,000 to the Authority through an interfund loan (the “Interfund Loan”). (g) The Authority intends to reimburse the City from tax increme nts derived from the property within the TIF District in accordance with the terms of this resolution, the Agreement, and a resolution adopted by the Board of Commissioners of the Authority on the date hereof (the “EDA Interfund Loan Resolution”) which is incorporated herein by reference. (h) The City will make the Interfund Loan to the Authority from the City’s Affordable Housing Trust Fund in accordance with the terms of this resolution, the Agreement, and the EDA Interfund Loan Resolution. 1.02. Approval of Agreement. (a) The City Council hereby approves the Agreement in substantially the form presented to the City Council, together with any related documents necessary in connection therewith, including without limitation all documents, exhibits, ce rtifications, or consents referenced in or attached to the Agreement (together, the “Development Documents”). (b) The City Council hereby authorizes the Mayor and City Manager, in their discretion and at such time, if any, as they may deem appropriate, to execute the Development Documents on behalf of the City, and to carry out, on behalf of the City, the City’s obligations thereunder when all conditions precedent thereto have been satisfied. The Development Documents shall be in substantially the form on file with the City and the approval hereby given to the Development Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the City and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the City. The executi on of any instrument by the appropriate officers of the City herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. This resolution shall not constitute an offer and the Development Documents shall not be effective until the date of execution thereof as provided herein. (c) In the event of absence or disability of the officers, any of the documents authorized by this resolution to be executed may be executed without further act or authorization of the City Council by any duly designated acting official, or by such other officer or officers of the City Council as, in the opinion of the City Attorney, may act in their behalf. Upon execution and delivery of the Development Documents, the officers and employees of the City Council are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the City Council to implement the Development Documents, including without limitation the issuance of tax increment revenue obligations thereunder when all conditions precedent thereto have been satisfied and reserving funds for the payment thereof in the applicable tax increment accounts. DocuSign Envelope ID: 2FEDDF4B-154A-4EA5-94B5-7C6A4AAEF4B5 Resolution No. 22-083 3 Section 2. Interfund Loan from the Affordable Housing Trust Fund to Authority. (a) The City Council hereby authorizes the Interfund Loan in the principal amount of up to $1,800,000, which will be made from the City’s Affordable Housing Trust Fund in order to support the construction of affordable housing in the City. The Interfund Loan shall be made in accordance with the terms of the EDA Interfund Loan Resolution and the Agreement and repaid from Available Tax Increment (as defined therein) in accordance with the Interfund Loan Resolution and the Agreement. (b) Principal and interest (the “Payments”) on this Interfund Loan shall be paid semiannually on each February 1 and August 1 (each a “Payment Date”), commencing on the first Payment Date on which the Authority has Available Tax Increment (as defined in the EDA Interfund Loan Resolution), or on any other dates determined by the Executive Director of the Authority, through the date of last receipt of tax increment from the TIF District. The Authority will also apply payments, if any, of the Deferred Loan from the Developer or an affiliate thereof in accordance with the Agreement and the EDA Interfund Loan Resolution towards the repayment of the Interfund Loan. (c) The Interfund Loan shall be paid prior to any pay-as-you-go notes or contracts secured in whole or in part with Available Tax Increment, and any other outstanding or future interfund loans secured in whole or in part with Available Tax Increment; provided, however, that this Interfund Loan shall be repaid with Available Tax Increment on a parity basis with the interfund loan approved by the Board of Commissioners of the Authority on the date hereof in the principal amount of $50,000 in accordance with the EDA Interfund Loan Resolution relating to an interfund loan for administrative costs of the TIF District. (d) The City may at any time make a determination to forgive the outstanding principal amount and accrued interest on this Interfund Loan to the extent permissible under law. (e) The City may from time to time amend the terms of this resolution to the extent permitted by law. Section 3. Effective Date. This resolution shall be effective upon approval. Reviewed for administration: Adopted by the City Council June 6, 2022 Kim Keller, city manager Jake Spano, mayor Attest: Melissa Kennedy, city clerk DocuSign Envelope ID: 2FEDDF4B-154A-4EA5-94B5-7C6A4AAEF4B5