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HomeMy WebLinkAbout94-01 - ADMIN Resolution - Economic Development Authority - 1994/01/18RESOLUTION EDA 94-1 RESOLUTION APPROVING THE ISSUANCE OF $7,195,000 GENERAL OBLIGATION TAX INCREMENT REFUNDING BONDS OF 1994 BY THE CITY OF ST. LOUIS PARK, MINNESOTA; PLEDGING CERTAIN TAX INCREMENTS TO SUCH BONDS; AUTHORIZING A TAX INCREMENT PLEDGE AGREEMENT IN CONNECTION THEREWITH; AUTHORIZING THE REFUNDING OF $6,000,000 TAX INCREMENT REVENUE REFUNDING BONDS, SERIES 1990 OF THE ST. LOUIS PARK ECONOMIC DEVELOPMENT AUTHORITY; DIRECTING THE EARLY CALL FOR REDEMPTION OF SUCH BONDS; AND AUTHORIZING AN ESCROW AGREEMENT IN CONNECTION THEREWITH. WHEREAS, by resolutions duly adopted, the City of St. Louis Park, Minnesota (the "City") has created the following project areas and tax increment districts pursuant to Minnesota Statutes, Sections 469.001 to 469.047 (or their predecessor statutes): (i) Excelsior Boulevard Redevelopment Project, approved February 1, 1977 ("Excelsior Boulevard"); and (ii) Oak Park Village Redevelopment Project, approved November 6, 1972 ("Oak Park Village") (Excelsior Boulevard and Oak Park Village are collectively referred to herein as the "Districts"). The control, authority and operation of the Districts were transferred to St. Louis Park Economic Development Authority (the "EDA") by Resolution No. 88-134 of the City. WHEREAS, by Resolution No. 90-4 of EDA adopted March 19, 1990 and Resolution No. 90-29 of the City adopted on March 19, 1990, the geographical areas of the project areas of Excelsior Boulevard and Oak Park Village have been expanded and are coterminous (such expanded coterminous area is referred to herein as the "Project Area"). WHEREAS, the City has outstanding with respect to the Districts the following' - obligations (collectively, the "Prior Bonds"): District Description of Remaining Bonds Excelsior Boulevard $6,205,000 Variable Rate Demand -General -Obligation Tax — Increment Bonds, Series 1985 (the "Series 1985 Bonds") Oak Park Village $1,200,000 General Obligation Redevelopment Bonds of 1976 (the "Series 1976 Bonds") and the EDA has outstanding with respect to the Districts the following obligations (the "Series 1990 Bonds"): BOND22033112r03857-379 1/12/94 District Description of Bonds Excelsior Boulevard $6,000,000 Tax Increment Revenue Refunding Bonds, and Oak Park Village Series 1990 WHEREAS, under the law applicable to each District at the time of its creation, the City requested the Hennepin County auditor to certify the assessed value, of all taxable property in each District as of the preceding January 2, which assessed value, now referred to as tax capacity, as adjusted in accordance with law applicable to tax increment computation for such District, is hereinafter referred to as the "Original Tax Capacity". The tax capacity of all taxable property in each District as determined for each year, less the Original Tax Capacity, is hereinafter referred to as the "Captured Tax Capacity." The ad valorem taxes derived from such property by applying to the Captured Tax Capacity the aggregate tax capacity rate levied by all governmental entities having authority to levy taxes on such property is hereinafter referred to as the "Tax Increment." Under applicable law and subject to the limitations thereof, the Hennepin County Auditor is required to pay to EDA in each year the Tax Increment for each District described above as now established in such year; WHEREAS, the Tax Increment available in each year after payment or provision for payment from Excelsior Boulevard of the principal, interest and any redemption price due on the Series 1985 Bonds in such year and after payment or provision for payment, from Oak Park Village of the principal, interest and any redemption price due in such year on the Series 1976 Bonds shall be referred to in the aggregate as the "Available Tax Increment;" WHEREAS, the Series 1990 Bonds are subject to redemption at the option of the EDA on September 1, 2001, in whole or in part, at a redemption price of par plus accrued interest and a premium of 2% of the principal amount to be redeemed; WHEREAS, pursuant to Resolution No. 94-5 adopted January 3, 1994, the City has determined that it is in the best interest of the City to advance refund the Series 1990 Bonds from the proceeds of the proposed issuance of the City's General Obligation Tax Increment— - Refunding ncrement- Refunding Bonds of 1993 (the "Bonds"); WHEREAS, the City's Home Rule Charter (the "Charter") provides that in addition to the power to borrow and issue bonds granted in the Charter, the City shall have the powers granted to cities of its same class by the- laws iof the State -of Minnesota; - — - WHEREAS, the City's Charter provides that the City may issue bonds to provide funds for any public purpose not prohibited by law; WHEREAS, Minnesota Statutes, Section 469.178, Subd. 2 authorizes the City to issue general obligation bonds to finance any expenditure by the municipality or an authority the jurisdiction of which is wholly or partially within that municipality pursuant to Minnesota Statutes Section 469.176, Subd. 4 in the same manner and subject only to the same conditions BOND/22033112/03857-379 2 1/12/94 qW-1 as those provided in Minnesota Statutes Chapter 475 for bonds financing improvement costs reimbursable from special assessments and authorizes the City to pledge tax increment revenues for the payment of the principal of and interest on general obligation bonds issued pursuant to such Minnesota Statutes Section 469.178, Subd. 2; WHEREAS, the EDA is an authority of the City located wholly within the City; WHEREAS, Minnesota Statutes Section 469.174, Subd. 3 defines 'Bonds" to include refunding bonds for the purpose of Minnesota Statutes Section 469.176, Subd. 4; WHEREAS, Minnesota Statutes Section 475.67 authorizes the issuance of refunding bonds; WHEREAS, the EDA used the proceeds of the Series 1990 Bonds to current refund (within the meaning of the Internal Revenue Code of 1986, as amended) its $6,000,000 Tax Increment Revenue Bonds, Series 1990 (the "Refunded 1990 Bonds"); WHEREAS, the proceeds of the Refunded 1990 Bonds were used to finance public redevelopment costs in a redevelopment project area within the meaning of Minnesota Statutes Section 469.176, Subd. 4; WHEREAS, Minnesota Statutes, Section 475.60 authorizes the City to negotiate the sale of the Bonds if it has retained an independent financial advisor; WHEREAS, pursuant to Resolution No. 94-5 adopted January 3, 1994, the City Council (the "Council") found and determined that (1) it is necessary and in the best interests of the City to advance refund the Series 1990 Bonds from the proceeds of the Bonds; (2) the issuance of the Bonds is a public purpose not prohibited by law within the meaning of the City's Charter; and (3) Ehlers and Associates, Inc. is serving as financial advisor to the City in connection with the proposed authorization, issuance and sale of the Bonds and is an independent financial advisor pursuant to Minnesota Statutes, -Section 475.60, -Subdivision 21 --- paragraph 9; . WHEREAS, on December 20, 1993, the Council adopted a resolution which provided for the solicitation of competitive proposals for the negotiated sale of General Obligation Tax Increment Refunding Bonds of 1994 (the "Bonds"); WHEREAS, pursuant to Resolution No. 94-5 adopted January 3, 1994, the City accepted a proposal for the sale of the Bonds and authorized the issuance of the Bonds; WHEREAS, the refunding of the Series 1990 Bonds is consistent with covenants made with the holders thereof, and is necessary and desirable for the reduction of debt service costs to the City; BOND/220331 1=3857-379 3 1/12M WHEREAS, until redemption of the Series 1990 Bonds on September 1, 2001, with the proceeds of the Bonds and certain other available moneys, such proceeds and other moneys shall be held in escrow with First Trust National Association, as escrow agent (the "Escrow Agent") pursuant to the terms of an escrow agreement dated as of February 1, 1994, (the "Escrow Agreement") which shall provide that the proceeds of the Bonds, certain other available funds and interest earnings thereon shall be applied to payment of principal of and interest on the Bonds through September 1, 2001, which date said escrowed amounts shall also be applied to payment of the outstanding principal and accrued interest on all Series 1990 Bonds maturing after such date; WHEREAS, the City Council of the City has heretofore determined and declared that it is necessary and expedient to issue the Bonds, pursuant to Minnesota Statutes, Chapter 475 and Section 469.178, Subd. 2, and pursuant to Section 6.15 of its Home Rule Charter, to provide moneys, together with other available funds, to refund the Series 1990 Bonds; and WHEREAS, the EDA hereby finds and determines that it is in the beset interest of the EDA and the City to refund the Series 1990 Bonds: NOW, THEREFORE, BE IT RESOLVED, by the governing body of the EDA, as follows: 1. Acknowledgement of Issuance of Bonds. The issuance and sale of the Bonds by the City for the purpose of refunding the Series 1990 Bonds is hereby acknowledged and consented to by the EDA. 2. Pledge of Available Tax Increment. The EDA hereby pledges Available Tax Increment to the payment of the Bonds and agrees to pay such Available Tax Increment to the City in such amounts and at such times as are required for the timely payment of principal of, and interest and premium, if any, on, the Bonds. 3. Authorization of Tax Increment Pledge A eern . The Tax Increment Er' Pledge Agreement is hereby approved substantially in the form set forth as Exhibit G to Resolution No. 94-5 of the City, which Resolution has been previously presented to the EDA, and shall be executed on behalf of the EDA by its President and Executive Director of the EDA in substantially the form approved, with such changes, modifications, additions and deletions as shall be desirable or necessary and appropriate -and- approved by bond counsel. Execution by such officers of the Tax Increment Pledge Agreement shall be conclusive evidence as to the desirability or necessity and propriety of the changes and their approval by bond counsel. 4. Authorization of the Refunding and Redemption of the Series 1990 Bonds. The EDA hereby approves and authorizes the refunding and defeasance of the Series 1990 Bonds from the proceeds of the Bonds if and when issued by the City. Pursuant to Resolution EDA 90-8, the Series 1990 Bonds are subject to redemption and prior payment in BOND22033112103857-379 4 WZ94 whole or in part in such amounts as the EDA may designate at the option of the EDA on September 1, 2001, and any interest payment date thereafter for which proper notice can be given at a redemption price equal to the principal amount of the Series 1990 Bonds to be redeemed, plus accrued interest to the date of redemption, plus a redemption premium (as a percentage of the principal redeemed) set forth in such resolution. The EDA hereby exercises such option and irrevocably authorizes and directs the optional redemption in whole of all Series 1990 Bonds maturing on or after September 1, 2002 on the redemption date of September 1, 2001, subject only to the issuance of the Bonds and the receipt of the proceeds thereof and deposit of such proceeds pursuant to the Escrow Agreement. The EDA hereby directs that no more than forty nor less than thirty days prior to September 1, 2001, notice of such redemption shall be given by mail to the registered owners and published notice, if required by law, shall be given in accordance with Chapter 475, Minnesota Statutes, of the redemption of the Series 1990 Bonds so called for redemption in the preceding sentence, pursuant to the requirements of Section 2.03(c) of Resolution EDA 90-8 and pursuant to the terms of the Series 1990 Bonds. In addition, the EDA hereby authorizes and directs the payment, upon the issuance of the Bonds, of $600,000 of the amounts held for the payment of the Series 1990 Bonds, including without limitation, the reserve fund established therefor, to the Escrow Agent to be held pursuant to the Escrow Agreement. 5. Authorization of Escrow Agreement. The Escrow Agreement is hereby approved substantially in the form set forth as Exhibit B to Resolution No. 94-5 of the City, which Resolution has been previously submitted to the EDA, and shall be executed on the behalf of the EDA by its President and Executive Director in substantially the form approved, with such changes, modifications, additions and deletions as shall be desirable or necessary and appropriate and approved by bond counsel. Execution by such officers of the Escrow Agreement shall be conclusive evidence as to the desirability or necessity and propriety of the changes and their approval by bond counsel. 6. Records Documents and Certificates. The officers of the EDA are hereby authorized and directed to prepare and furnish to the City, bond counsel or the purchaser or the Bonds, certified copies of all proceedings and records of the EDA relating-to-theBotrds-or—__..._,- -- Tax Increment and to the financial condition and affairs of the EDA, and such other affidavits, certificates, agreements and information as are required or desirable in connection with the issuance of the Bonds or showing facts relating to the legality and marketability of the Bonds and the security therefor, as the same shall appear from the books and records under their custody and control or as otherwise known to them, and such certificates,- agreements ertificates, agreements and affidavits, including any heretofore furnished, shall be deemed representations of the EDA as to the facts recited therein. In the absence of the President or Executive Director of the EDA, any and all records, documents, agreements and certificates, including without limitation, the Tax Increment Pledge Agreement and the Escrow Agreement, may be signed by any two members of the governing body of the EDA. 7. Negative Covenants as to Use of Proceeds and Projects. The EDA hereby represents that neither it nor the City has used the proceeds of the Series 1990 Bonds or the BOND/220331 1=3857-379 5 1/12194 improvements financed from the proceeds thereof, or the proceeds of the Refunded 1990 Bonds, and hereby covenants not to use the proceeds of the Bonds or such improvements, or to cause or permit them to be used, or to enter into any deferred payment arrangements for the cost of such improvements, in such a manner as to cause the Refunded 1990 Bonds, the Series 1990 Bonds, or the Bonds, to be "private activity bonds" within the meaning of Sections 103 and 141-150 of the Internal Revenue Code of 1986, as amended (the "Code"). 8. Tax -Exempt Status of the Bonds: Rebate. The EDA shall comply with the requirements necessary under the Code to establish and maintain the exclusion from gross income under Section 103 of the Code of the interest on the Series 1990 Bonds and the Bonds, including, without limitations, requirements relating to temporary periods for investments, limitations on amounts invested at a yield greater than the yield on the Bonds, and rebate of excess investment earnings to the United States. To the extent required by law, the EDA will make or cause to be made, when required, calculations at to the yield on the Series 1990 Bonds and on amounts invested in connection therewith, and will rebate to the United States of America any amounts with respect to the Series 1990 Bonds necessary to be rebated under Section 148 of the Code. To the extent required by law, there shall be established a separate and segregated account known as the "Series 1990 Bonds Rebate Account' for deposits of amounts required to be rebated to the United States of America. Funds in the Series 1990 Rebate Account shall not be deemed pledged to the Series 1990 Bonds or the Bonds. On the basis of the existing facts, estimates and circumstances, including the foregoing findings and covenants, the EDA hereby certifies that it does not expect that the proceeds of the Bonds will be used in such a manner as to cause the Bonds to be arbitrage bonds under Section 148 of the Code and the regulations thereunder. The EDA covenants and agrees, from time to time, that it will not take or permit to be taken by any of its officers, employees or agents, any action which would cause the interest on the Series 1990 Bonds or the Bonds to become subject to taxation under the Code, and the applicable regulations thereunder, and covenants to take any and all actions within its power -to -ensure -that the -interest on the Series-- - 1990 Bonds and the Bonds will not become subject to taxation. 9. Severabilitv. If any section, paragraph or provision of this Resolution shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of -this - Resolution. 10. Headings. Headings of this Resolution are included for convenience of reference only and are not a part hereof, and shall not limit or defined the meaning of any provision hereof. 11. Effective Date. This Resolution shall become effective immediately upon adoption. BOND22033112103957-379 6 1/12/94 9W - I DhICROFILMED Adopted by the St. Louis Park Economic Development Authority this 18th day of January, 1994. ST. LOUIS PARK ECONOMIC DEVELOPMENT AUTHORITY By�44 W Ig President By Its Executive Director ATTEST: Lag I ecretary BOND22033112/03857-379 7 1/1294