Loading...
HomeMy WebLinkAbout22-33 - ADMIN Resolution - Economic Development Authority - 2022/06/20EDA Resolution No. 22-33 Resolution approving contract for private development, awarding the sale of, and providing the form, terms, covenants and directions for the issuance of a tax increment revenue note to Beltline Station Limited Partnership, and taking other actions in connection therewith Be it resolved by the Board of Commissioners (the “Board”) of the St. Louis Park Economic Development Authority (the “Authority”) as follows: Section 1. Recitals. 1.01. The City Council of the City of St. Louis Park, Minnesota (the “City’) and the Authority have approved the establishment of the Beltline Station Tax Increment Financing District No. 1 (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. 1.02. To facilitate the development of certain property within the Project and TIF District, the Authority, the City, and Beltline Station Limited Partnership, a Minnesota limited partnership (the “Owner”), have negotiated a Contract for Private Development (the “Agreement”) which provides for the construction by the Owner of an affordable rental housing facility (the “Minimum Improvements”) on certain property described therein (the “Development Property”), the issuance by the Authority of a tax increment revenue note (the “TIF Note”) to the Owner, and the loan of proceeds of funds from the City’s Affordable Housing Trust Fund in the principal amount of $618,238 to the Owner. Pursuant to a separate purchase agreement, the Authority will agree to convey a portion of the Development Property to Bel tline Development LLC a Minnesota limited liability company and an affiliate of the Owner (“Beltline Development”). Beltline Development will assign its interest in the Development Property to the Owner. 1.03. In order to assist with the costs of the Minimum Improvements, the Authority, applied for and received a Contamination Cleanup Grant in the amount $418,547 a portion of which will be used for the Development Property (the “DEED Grant”) from the Minnesota Department of Employment and Economic Development (“DEED”). 1.04. DEED and the Authority entered into the Contamination Cleanup Grant Contract Agreement No. CCGP-21-0022-Z-FY22 (the “Grant Agreement”). Proceeds of the DEED Grant may be used for eligible project components of the Minimum Improvem ents (the “Grant- Eligible Activities”) as described in the Grant Agreement. 1.05. The Authority intends to disburse the proceeds of the DEED Grant to the Developer to provide financing for the Grant-Eligible Activities as set forth in the Agreement. 1.06. To allow the Owner to perform certain obligations under the Agreement, Cedar Rapids Bank and Trust, an Iowa banking corporation, in its capacity as lender, together with any other permitted co-lenders and their respective successors and/or permitted assigns (collectively, “Senior Lender”), has agreed to provide the Owner with financing by purchasing the tax-exempt DocuSign Envelope ID: F6785B6E-5055-4B21-ACEB-F4AB45FD7006 EDA Resolution No. 22-33 2 conduit revenue obligations to be issued by the City and providing taxable financing in the combined estimated principal amount of $21,000,000 (collectively, the “Senior Financing”). Section 2. The Agreement and Related Documents. 2.01. Subject to approval of the TIF District and the Agreement by the City Council, the Board hereby approves the Agreement in substantially the form presented to the Board, together with any related documents necessary in connection therewith, including without limitation all documents, exhibits, certifications, or consents referenced in or attached to the Agreement including without limitation the Assessment Agreement and the Declaration of Restrictive Covenants (all as defined in the Agreement) (the “TIF Documents”). In addition, in order to provide the Senior Financing, the Senior Lender requires the execution and delivery by the Authority of the following documents, forms of which are on file with the Authority (the “Additional Lender Documents” and together with the TIF Documents, the “Development Documents”): (i) a Master Subordination Agreement between the Senior Lender, the City, and the Authority, pursuant to which the authority and the City agree to subordinate their right to, title to, and interest in the Property and the rights and the remedies and options of the Authority under the Contract to those of the Senior Lender and the Senior Financing; (ii) two Collateral Assignments of Payments under Tax Increment Revenue Note between the Owner and the Senior Lender and acknowledged by the Authority, pursuant to which the Authority consents to the assignment of the TIF Note by the Owner to the Senior Lender; and (iii) a Master Loan Disbursement Agreement between the Owner, the Authority, the Senior Lender, the City, and a title company selected by the Developer relating to the disbursement of the DEED Grant. 2.02. The Board hereby authorizes the President and Executive Director, in their discretion and at such time, if any, as they may deem appropriate, to execute the Development Documents on behalf of the Authority, and to carry out, on behalf of the Authority, the Authority’s obligations thereunder when all conditions precedent thereto have been satisfied. The Development Documents shall be in substantially the form on file with the Authority 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 Authority 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 Authority. The execution of any instrument by the appropriate officers of the Authority 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. 2.03. 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 Board by any duly designated acting official, or by such other officer or officers of the Board 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 Board are hereby authorized and directed to take or cause to be taken such actions as may be necessary on behalf of the Board to implement the Development Documents, including without limitation the issuance of tax DocuSign Envelope ID: F6785B6E-5055-4B21-ACEB-F4AB45FD7006 EDA Resolution No. 22-33 3 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. Section 3. Issuance, Sale, and Terms of the TIF Note. 3.01. The Authority hereby authorizes the President and Executive Director to issue the TIF Note in accordance with the Agreement. All capitalized terms in this resolution have the meaning provided in the Agreement unless the context requires otherwise. 3.02. The TIF Note shall be issued to the Owner in the maximum aggregate principal amount of $1,442,847 in consideration of certain eligible costs incurred by the Owner in connection with construction of the Minimum Improvements under the Agreement. The TIF Note shall be dated the date of delivery thereof, and shall bear interest at the lesser of the rate of 5.12% per annum or the actual interest rate of the Owner’s mortgage financing, from the date of issue to the earlier of maturity or prepayment. The TIF Note will be issued in the principal amount of Public Development Costs submitted and approved in accordance with Section 3.3 of the Agreement. The TIF Note is secured by Available Tax Increment, as further described in the form of the TIF Note. The Authority hereby delegates to the Executive Director the determination of the date on which the TIF Note is to be delivered, in accordance with the Agreement. 3.03. In the event of legislative changes reducing the tax rate classification of certain qualified low-income rental housing under Minnesota Statutes, Section 273.13, subdivision 25(e), the Authority may reduce the principal amount of the TIF Note in the Agreement to reflect the anticipated reduction in taxes for the Minimum Improvements. The Authority hereby delegates to the Executive Director, in consultation with the Authority’s municipal advisor, the authority to determine of the final amount of the TIF Note in the event such legislation passes. Section 4. Form of TIF Note. The TIF Note shall be in substantially the form attached as an exhibit to the Agreement, with the blanks to be properly filled in and the principal amount adjusted as of the date of issue. Section 5. Terms, Execution and Delivery. 5.01. Denomination, Payment. The TIF Note shall be issued as a single typewritten note numbered R-1. The TIF Note shall be issuable only in fully registered form. Principal of and interest on the TIF Note shall be payable by check or draft issued by the Registrar described herein. 5.02. Dates; Interest Payment Dates. Principal of and interest on the TIF Note shall be payable by mail to the owner of record thereof as of the close of business on the fifteenth day of the month preceding the Payment Date, whether or not such day is a business day. 5.03. Registration. The Authority hereby appoints the Finance Director of the City to perform the functions of registrar, transfer agent and paying agent (the “Registrar”). The effect of registration and the rights and duties of the Authority and the Registrar with respect thereto shall be as follows: DocuSign Envelope ID: F6785B6E-5055-4B21-ACEB-F4AB45FD7006 EDA Resolution No. 22-33 4 (a) Register. The Registrar shall keep at its office a bond register in which the Registrar shall provide for the registration of ownership of the TIF Note and the registration of transfers and exchanges of the TIF Note. (b) Transfer of TIF Note. Upon surrender for transfer of the TIF Note duly endorsed by the registered owner thereof or accompanied by a written instrument of transfer, in form reasonably satisfactory to the Registrar, duly executed by the registered owner thereof or by an attorney duly authorized by the registered owner in writing, the Registrar shall authenticate and deliver, in the name of the designated transferee or transferees, a new TIF Note of a like aggregate principal amount and maturity, as requested by the transferor. The Registrar may close the books for registration of any transfer after the fifteenth day of the month preceding each Payment Date and until such Payment Date. (c) Cancellation. The TIF Note surrendered upon any transfer shall be promptly cancelled by the Registrar and thereafter disposed of as directed by the Authority. (d) Improper or Unauthorized Transfer. When the TIF Note is presented to the Registrar for transfer, the Registrar may refuse to transfer the same until it is satisfied that the endorsement on the TIF Note or separate instrument of transfer is legally authorized. The Registrar shall incur no liability for its refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized. (e) Persons Deemed Owners. The Authority and the Registrar may treat the person in whose name the TIF Note is at any time registered in the bond register as the absolute owner of such TIF Note, whether the TIF Note shall be overdue or not, for the purpose of receiving payment of, or on account of, the principal of and interest on the TIF Note and for all other purposes, and all such payments so made to any such registered owner or upon the owner’s order shall be valid and effectual to satisfy and discharge the liability of the Authority upon the TIF Note to the extent of the sum or sums so paid. (f) Taxes, Fees and Charges. For every transfer or exchange of the TIF Note, the Registrar may impose a charge upon the owner thereof sufficient to reimburse the Registrar for any tax, fee, or other governmental charge required to be paid with respect to such transfer or exchange. (g) Mutilated, Lost, Stolen or Destroyed TIF Note. In case the TIF Note shall become mutilated or be lost, stolen, or destroyed, the Registrar shall deliver a new TIF Note of like amount, maturity dates and tenor in exchange and substitution for and upon cancellation of such mutilated TIF Note or in lieu of and in substitution for the TIF Note lost, stolen, or destroyed, upon the payment of the reasonable expenses and charges of the Registrar in connection therewith; and, in the case the TIF Note lost, stolen, or destroyed, upon filing with the Registrar of evidence satisfactory to it that the TIF Note was lost, stolen, or destroyed, and of the ownership thereof, and upon furnishing to the Registrar of an appropriate bond or indemnity in form, substance, and amount satisfactory to it, in which both the Authority and the Registrar shall be named as obligees. The TIF Note so surrendered to the Registrar shall be cancelled by it and evidence of such cancellation shall be given to the Authority. If the mutilated, lost, stolen, or destroyed TIF Note DocuSign Envelope ID: F6785B6E-5055-4B21-ACEB-F4AB45FD7006 EDA Resolution No. 22-33 5 has already matured or been called for redemption in accordance with its terms, it shall not be necessary to issue a new TIF Note prior to payment. 5.04. Preparation and Delivery. The TIF Note shall be prepared under the direction of the Finance Director of the City and shall be executed on behalf of the Authority by the signatures of its President and Executive Director. In case any officer whose signature shall appear on the TIF Note shall cease to be such officer before the delivery of the TIF Note, such signature shall nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in office until delivery. When the TIF Note has been so executed, it shall be delivered by the Executive Director to the Owner thereof in accordance with the Agreement. Section 6. Security Provisions. 6.01. Pledge. The Authority hereby pledges to the payment of the principal of and interest on the TIF Note all Available Tax Increment as defined in the TIF Note. Available Tax Increment shall be applied to payment of the principal of and interest on the TIF Note in accordance with the terms of the form of TIF Note. 6.02. Bond Fund. Until the date the TIF Note is no longer outstanding and no principal thereof or interest thereon (to the extent required to be paid pursuant to this resolution) remains unpaid, the Authority shall maintain a separate and special “Bond Fund” to be used for no purpose other than the payment of the principal of and interest on the TIF Note. The Authority irrevocably agrees to appropriate to the Bond Fund on or before each Payment Date the Available Tax Increment in an amount equal to the Payment then due, or the actual Available Tax Increment, whichever is less. Any Available Tax Increment remaining in the Bond Fund shall be transferred to the Authority’s account for the TIF District upon the termination of the TIF Note in accordance with its terms. Section 7. Certification of Proceedings. The officers of the Authority are hereby authorized and directed to prepare and furnish to the Owner of the TIF Note certified copies of all proceedings and records of the Authority, and such other affidavits, certificates, and information as may be required to show the facts relating to the legality of the TIF Note as the same appear from the books and records under their custody and control or as otherwise known to them, and all such certified copies, certificates, and affidavits, including any heretofore furnished, shall be deemed representations of the Authority as to the facts recited therein. Section 8. Effective Date. This resolution shall be effective upon approval. DocuSign Envelope ID: F6785B6E-5055-4B21-ACEB-F4AB45FD7006 EDA Resolution No. 22-33 6 Reviewed for Administration: Adopted by the Economic Development Authority June 20, 2022 Karen Barton, executive director Margaret Rog, president Attest: Melissa Kennedy, secretary DocuSign Envelope ID: F6785B6E-5055-4B21-ACEB-F4AB45FD7006