HomeMy WebLinkAbout25-051 - ADMIN Resolution - City Council - 2025/04/21
Resolution No. 25-051
Approving the execution and delivery of an Amended and Restated Fee
Agreement with Park Nicollet Health Services, Park Nicollet Methodist
Hospital, Park Nicollet Clinic, PNMC Holdings, and Park Nicollet Health
Care Products
Whereas, the City of St. Louis Park, Minnesota (the “city”) is a home rule city duly
organized and existing under its charter and the Constitution and laws of the State of
Minnesota; and
Whereas, on June 11, 2015, pursuant to a Bond Trust Indenture, dated as of
June 1, 2015 (the “prior bond indenture”), between the Housing and Redevelopment Authority
of the City of Saint Paul, Minnesota (the “issuer”), and Computershare Trust Company, N.A., a
national banking association (the “prior bonds trustee”), the issuer issued its (a) Health Care
Facilities Revenue Refunding Bonds (HealthPartners Obligated Group), Series 2015A (the
“series 2015A bonds” or the “prior bonds”), in the original aggregate principal amount of
$306,395,000; and (b) Taxable Health Care Facilities Revenue Refunding Bonds (HealthPartners
Obligated Group), Series 2015B (the “series 2015B bonds,” and together with the series 2015A
bonds, the “series 2015 bonds”), in the original aggregate principal amount of $191,830,000;
and
Whereas, a portion of the proceeds of the series 2015A bonds in the principal amount
of $145,185,000 was used to make a loan (the “prior Regions Hospital loan”) to Regions
Hospital to (a) defease, redeem, and prepay the Health Care Facility Revenue Bonds,
Series 2006 (HealthPartners Obligated Group Project), issued by the Issuer on November 30,
2006, in the original aggregate principal amount of $176,365,000, the proceeds of which (i)
financed the acquisition, construction, expansion, improvement, remodeling, equipping, and
furnishing of the hospital facilities located at the intersection of Jackson Street and University
Avenue, Saint Paul, Minnesota, including but not limited to capital improvements, up to an
eleven-story tower for surgery, patient rooms, clinical facilities and support services, and
underground parking; and (ii) refinanced the construction of improvements to the hospital
facilities by redeeming and prepaying the Health Care Revenue Bonds (St. Paul-Ramsey Medical
Center Project), Series 1993, issued by the Issuer in the original aggregate principal amount of
$36,340,000; and (b) pay a portion of the costs of issuance of the Series 2015A Bonds; and
Whereas, a portion of the proceeds of the series 2015A bonds in the principal amount
of $161,210,000 (the “prior Park Nicollet tax-exempt Bonds”) was used to make a loan (the
“prior Park Nicollet tax-exempt loan”) to Park Nicollet Health Services, Park Nicollet Methodist
Hospital, Park Nicollet Clinic, PNMC Holdings, and Park Nicollet Health Care Products, all
Minnesota nonprofit corporations (collectively, “Park Nicollet”), pursuant to a Loan Agreement,
dated as of June 1, 2015 (the “prior Park Nicollet tax-exempt loan agreement”), between the
issuer and Park Nicollet, to (a) defease, redeem, and prepay a portion of the Health Care
Facilities Revenue Refunding Bonds (Park Nicollet Health Services Project), Series 2009 (the
“series 2009 bonds”), issued by the city on December 30, 2009 in the original aggregate
principal amount of $188,340,000, the proceeds of which were used to finance a capital project
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that commenced in 2003, which included the (i) acquisition, construction, and equipping of an
approximately 82,000 square foot building to house the Cancer Center and related facilities
with approximately 31,000 square feet of the building reserved for future expansion, located at
6490 Excelsior Boulevard in the city; (ii) acquisition, construction, and equipping of a new
parking ramp including approximately 1,700 parking stalls adjacent to the Cancer Center;
(iii) redesign and renovation of the emergency center at Park Nicollet Methodist Hospital,
located at 6500 Excelsior Boulevard in the city; (iv) construction and equipping of a new
common entrance to Park Nicollet Methodist Hospital, the new Cancer Center, and the
Meadowbrook Building, located at 3931 Louisiana Avenue South in the city; and (v) acquisition,
construction, and equipping of an approximately 69,000 square foot Eating Disorders Institute,
including a parking ramp and surface lot with an estimated 220 parking stalls, located at 3525
Monterey Drive in the city (collectively, the “2003 project”); (b) defease, redeem, and prepay a
portion of the Health Care Facilities Revenue Refunding Bonds (Park Nicollet Health Services
Project), Series 2008C (the “series 2008C bonds”), issued by the city on August 14, 2008 in the
original aggregate principal amount of $221,850,000, the proceeds of which refinanced the
remaining costs of the 2003 project described above and refinanced capital improvements to
the facilities of Park Nicollet originally financed with the Hospital Facilities Refunding Revenue
Bonds (Methodist Hospital Project), Series 1990-B issued by the city; and (c) pay a portion of
the costs of issuance of the series 2015A bonds; and
Whereas, the proceeds of the series 2015B bonds (the “prior Park Nicollet taxable
bonds”) were used to make a loan (the “prior Park Nicollet taxable loan”) to Park Nicollet,
pursuant to a Loan Agreement, dated as of June 1, 2015 (the “prior Park Nicollet taxable loan
agreement”), between the issuer and Park Nicollet, to (a) defease, redeem, and prepay a
portion of the series 2009 bonds, the proceeds of which refinanced (i) the construction and
equipping of the Heart and Vascular Center at Park Nicollet Methodist Hospital, the
construction of a parking ramp and other improvements at Park Nicollet Methodist Hospital,
the construction of public infrastructure improvements with respect to the foregoing, and the
acquisition and installation of equipment for Park Nicollet Methodist Hospital; and (ii) the
acquisition and installation of a computed tomography (“CT”) scanner at the facilities located at
14000 Fairview Drive, Burnsville, Minnesota, a CT scanner at the facilities located at 15800 95th
Avenue North, Maple Grove, Minnesota, and a CT scanner and a magnetic resonance imaging
scanner at the facilities located at 250 North Central Avenue, Wayzata, Minnesota; (b) defease,
redeem, and prepay a portion of the series 2008C bonds, the proceeds of which refinanced
capital improvements to the facilities of Park Nicollet originally financed with the following
obligations issued by the city: (i) $138,025,000 Health Care Facilities Revenue Bonds
(HealthSystem Minnesota Obligated Group), Series 1993A, (ii) $42,000,000 Health Care
Facilities Revenue Bonds (HealthSystem Minnesota Obligated Group), Series 1993B, and (iii)
$42,000,000 Health Care Facilities Revenue Bonds (HealthSystem Minnesota Obligated Group),
Series 1993C; and (c) pay all or a portion of the costs of the series 2015B bonds; and
Whereas, the facilities refinanced with the proceeds of the prior Park Nicollet tax-
exempt Bonds and the prior Park Nicollet taxable bonds that are located in the city are referred
to herein as the St. Louis Park facilities.
Whereas, prior to the issuance of the series 2015 bonds, on May 18, 2015, the city
council of the city (the “council”) conducted a duly noticed public hearing in accordance with
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Section 147(f) of the Internal Revenue Code of 1986, as amended, and consented to the
issuance of the series 2015 bonds by the issuer to, in part, refinance the St. Louis Park facilities;
and
Whereas, in connection with the issuance of the series 2015 bonds, the city and Park
Nicollet entered into a Fee Agreement, dated June 11, 2015 (the “original fee agreement”),
pursuant to which Park Nicollet agreed to pay the city’s administrative fee for conduit bond
financings with respect to the prior Park Nicollet tax-exempt bonds, which were initially issued
in the principal amount of $161,210,000, and with respect to the series 2015B bonds
(collectively, the “prior St. Louis Park portion”), on each January 1 and July 1, commencing
July 1, 2015, in an amount equal to one-sixteenth of one percent (0.0625%) of the principal
amount of the prior St. Louis Park portion outstanding on each such date, all in accordance with
Part II, paragraph 9 of the city’s Private Activity Revenue Bond Financing Policy, effective as of
February 26, 2001; and
Whereas, Regions Hospital and Park Nicollet have proposed that the issuer issue its
Health Care Facilities Revenue Refunding Bonds (HealthPartners Obligated Group), Series 2025
(the “bonds”), in the estimated maximum aggregate principal amount of $300,000,000, and
loan the proceeds thereof to Regions Hospital and Park Nicollet to (i) defease, redeem, and
prepay the outstanding series 2015A bonds, thereby refinancing the facilities refinanced with
the proceeds thereof; and (ii) pay all or a portion of the costs of issuing the bonds and other
related costs; and
Whereas, the series 2015B bonds will remain outstanding under the prior bond
indenture; and
Whereas, a portion of the proceeds of the bonds will be used to make a loan (the “Park
Nicollet loan”) to Park Nicollet to refinance the prior Park Nicollet tax-exempt bonds and the
facilities refinanced thereby, as more fully described in a Loan Agreement (the “Park Nicollet
loan agreement”) between the issuer and Park Nicollet, pursuant to which Park Nicollet will
agree to repay the Park Nicollet loan in such amounts and at such times as will be sufficient to
pay the principal of, premium, if any, and interest of the principal amount of the bonds used to
refinance the prior Park Nicollet tax-exempt bonds (the “Park Nicollet bonds”); and
Whereas, there has been presented before the council of the city a form of Amended
and Restated Fee Agreement (the “fee agreement”) between the city and Park Nicollet,
amending and restating the original fee agreement, pursuant to which Park Nicollet will agree
to pay the city’s administrative fee with respect to the Park Nicollet bonds and to continue
paying the city’s administrative fee with respect to the series 2015B bonds; and
Now, therefore, be it resolved by the city council of the City of St. Louis Park, Minnesota as
follows:
1. Based on representations made by Park Nicollet to the city to date, the council
hereby makes the following preliminary findings, determinations, and declarations:
(a) The issuer will make the Park Nicollet loan to Park Nicollet pursuant to the Park
Nicollet loan agreement. Park Nicollet will be required to make loan repayments in amounts
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sufficient to repay the Park Nicollet loan when due and to pay all costs of maintaining and
insuring the facilities to be refinanced with the proceeds of the Park Nicollet bonds.
(b) The bonds will be special, limited obligations of the issuer payable solely from
the revenues pledged to the payment thereof and will not be a general or moral obligation of
the city or be secured by the taxing power or any property or assets of the city.
(c) The city consents to and approves of the issuance of the Park Nicollet bonds and
the bonds and the refinancing of the prior Park Nicollet tax-exempt bonds.
3. The fee agreement is hereby in all respects authorized, approved and confirmed
and the mayor and city manager are hereby authorized and directed to execute and deliver the
fee agreement for and on behalf of the city in substantially the form now on file with the city
but with such modifications as shall be deemed necessary, desirable or appropriate, their
execution thereof to constitute conclusive evidence of their approval of any and all
modifications therein including the insertion of a final schedule for the Park Nicollet bonds.
4. The mayor and the city manager are authorized and directed to execute any
additional documents and certificates deemed necessary to carry out the intentions hereof.
5. Park Nicollet will pay and upon demand, reimburse the city for payment of, any
and all costs incurred by the city in connection with the facilities to be refinanced by the Park
Nicollet loan and the issuance of the Park Nicollet bonds, whether or not the Park Nicollet
bonds are issued.
6. This resolution shall be in full force and effect from and after its passage.
Reviewed for administration: Adopted by the city council April 21, 2025:
Kim Keller, city manager Nadia Mohamed, mayor
Attest:
Melissa Kennedy, city clerk
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