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HomeMy WebLinkAboutResolution - 81-240 - Housing Revenue Bonds - Edenvale Apartments - $7,765,000 - 02/02/1981 After some discussion , Member Edstrom introduced the following resolution and moved its adoption : RESOLUTION NO. 0 RESOLUTION RELATING TO THE ISSUANCE OF REVENUE BONDS PURSUANT TO CHAPTER 462C , MININESOTA STATUTES , FOR THE PURPOSE OF FINANCING A MULTI-FAMILY HOUSING DEVELOPMENT ; GIVING PRELIMINARY APPROVAL `1'O THE DEVELOPMENT, AUTHORIZING A PUBLIC HEARING ON THE HOUSING PLAN AND THE PREPARATION OF A PROGRAM AND AUTHORIZING SUBMISSION OF THE HOUSING PLAN AND PROGRAM FOR REVIEW BE IT RESOLVED by the City Council of the City of Eden Prairie , Minnesota ( the City ) , as follows : Section 1 . Recitals . 1. 01 . By the provisions of Minnesota Statutes , Chapter 462C , as amended ( the Act ) , the City is authorized to plan , administer, issue and sell revenue bonds or obligations to make or purchase loans to finance one or more multifamily housing developments within its boundaries which revenue bonds or obligations shall be payahle solely from the revenues of the development. 1. 02 . The Act provides that , prior to issuing revenue bonds or obligations to finace a multifamily housing development , the City must develop a housing plan and , after holding a public hearing thereon after notice published at least thirty days prior thereto , submit the housing plan for review to the regional development commission . 1 . 03 . The Act further provides that the City may plan , administer and make or purchase a loan or loans to finance one or more developments of the kinds described in Subdivisions 2, 3 , 4 and 7 of Section 462C. 05 of the Act upon adoption of a program setting forth the information required by Subdivision. 6 of Section 462C. 05 of the Act after a public hearing thereon and upon approval by the Minnesota Housing Finance Agency as provided by Section 462C . 01 of the Act on the basis of the considerations stated in Section 462C. 04 of the Act. -2- 1 . 04 . Messrs . Sid Bader and Zollie Baratz ( the Developers ) , who will be general partners in Edenvale Apartments , a Minnesota partnership to be formed ( the Partnership) , have advised this Council of their desire to acquire certain land located at the northeast quadrant of Mitchell Road and Valley View Road in the City and to construct and equip thereon a 174-unit rental apartment building together with parking and related facilities ( the Project) . The Developers have received a commitment for mortgage insurance under Section 221 (d ) ( 4 ) of the National Housing Act from the United States Department of Housing and Urban Development ( HUD) ; in addition HUD has reserved housing assistance payments for 35 units in the Project under Section 8 of the United States Housing Act of 1937 . Total development and financing costs are presently estimated by the Developer to be approximately $ 9 , 078 , 000. 1 . 05 . The Developers have requested that the City issue its revenue bonds in one or more series ( the Bonds ) pursuant to the authority of the Act in such aggregate principal amount as may be necessary to finance all or a portion of the costs of the Project and make the proceeds of the Bonds available to the Partnership for the acquisition , construction and equipping of the Project , subject to agreement by the Partnership to pay promptly the principal of and interest on the Bonds . 1. 06 . The City has been advised by the Developer that conventional commercial financing is available to pay the capital costs of the Project only on a limited basis and at such high costs of borrowing that the scope of the Project and the economic, feasibility of operating the Project would be significantly affected , but with the aid of municipal financing the Project can be constructed as designed and its operation can be made more economically feasible . 1. 07 . The Council has been advised by representatives of Juran and Moody, Inc . , of St. Paul , Minnesota , that on the basis of information available to them and their discussions with the Developers and potential purchasers of tax-exempt bonds , the Bonds could be sold at favorable rates and terms to finance the Project . 1. 08 . The full faith and credit of the City will not be pledged to or responsible for the payment of the principal of and interest on the Bonds. s -3- Section 2 . Arprovals; Authorization and Hearina. 2 . 01 . It is hereby found and determined that it would be in the best interests of the City to issue the Bonds under the provisions of the Pact to finance the cost of the Project in an amount currently estimated to be $ 7 , 765 , 00 . 2 . 02. The Project is hereby given preliminary approval by the City and the issuance of the Bonds for such purpose approved, subject to conditions on such approval as may be requires' as a result of the public hearing called pursuant to Section 2. 04 hereof . The Bonds shall not be issued until the housing plan and the multifamily housing program described below have been reviewed and approved as provided by the Act and until the City , the Partnership and the Underwriter have agreed upon the details of the Bonds and the provisions for their payment. The principal of , premium, if any , and interest on each Bond , when , as and if issued , shall be payable solely from the revenues of the Project and the property pledgee to the payment thereof and shall not constitute a debt of the City. The City Attorney and other officers of the City are authorized in cooperation with Dorsey , Windhorst , Hannaford, Whitney & Halladay , as bond counsel , to initiate preparation of such documents as may be appropriate to the financing of the Project setting forth the detailed terms of the Bonds , the security therefor and provisions for payment of the principal , premium, if any, and interest thereon in compliance with state and federal statutes and regulations. 2 . 03. The Eden Prairie Guide Plan Update, a report prepared by the City of Eden Prairie and Brauer & Associates, Inc . , sets forth , inter alia , information relating to the housinq needs of. the City and data demonstrating those needs , the plan of the City to meet identified housing needs and specific methods to be used to carry out the plan; the Eden. Prairie Guide Plan Update therefore contains in pertinent part the information required by Subdivision 1 of Section 462C .03 of the Act. The Planning Department of the City is heresy authorized to prepare a program for a multifamily housing development pursuant to the requirements of Subdivision 5 of Section 462C . 05 of the Act ( the Program ) . After preparation thereof , the City Clerk is hereby authorized to cause notice of public hearing ( in substantially the form of Exhibit A hereto ) to be published in the Minneapolis Star/Tribune and in the Eder, Prairie News at least thirty -4- days before the date on which a public hearing on the Eden Prairie Guide Plan Update as it relates to the housing needs of the City and the Program will be held by this Council . The City Clerk and the City Manager are authorized to establish the date of such public hearing . Subsequent to the public hearing , the Mayor , City Manager , City Clerk and other officers and employees of the City are hereby authorized to submit the Eden Prairie Guide Plan Update to Metropolitan Council for review and comment pursuant to Subdivision 1 of Section 462C. 04 of the Act and to prepare and execute the required certifications and submit the Program to the Minnesota Housing Finance Agency for review and approval in accordance with Subdivision 5 of Section 462C. 05 and Subdivision 2 of Section 462 . 04 of the Act. 2. 04 . Pursuant to Subdivision 1 of Section 462C. 07 of the Act , in the making of the loan to finance acquisition , construction and equipment of the Project and in the issuance of the Bonds or other obligations of the City, the City may exercise , within its corporate limits , any of the powers the Minnesota Housing Finance Agency may exercise under Chapter 462A, Minnesota Statutes , without limitation under the provisions of Chapter. 475 , Minnesota Statutes . 2. 05. The Developer has agreed to pay directly or through the City any and all costs incurred by the City in connection with the Project whether or not the Project is approved by the Minnesota Housing Finance Agency ; whether or not the Project is carried to completion ; and whether or not the Bonds and all operative instruments are executed . 2. 06 . The adoption of this resolution does not constitute a guarantee or a firm commitment that the City will issue the Bonds as requested by the Developer. The City retains the right in its sole discretion to withdraw from participation and accordingly not issue the Bonds should the City at any time prior to the issuance thereof determine that it is in the best interest of the City not to issue the Bonds or should the City , the Developer and any other parties to the transaction be unable to reach agreement as to the terms and conditions of any of the documents required for the transaction. 2. 07. All commitments of the City expressed herein are subject to the condition that within twelve months of the date of adoption of this Resolution the City and the Developer shall have agreed to mutually acceptable -5- terms and conditions of the Bonds , the operative documents and of the other instruments and proceedings relating to the Bonds and their issuance and sale . If the events set forth herein do not take place within the time set forth above , or any extension thereof , and the Bonds are not sold within such time , this Resolution shall expire and be of no further effect . Passed and adopted by the City Council of the City of Eden Prairie this lst day c?f December, 198 MayoIL Attest : _ r e y Clerk �_�he motion for the adoption of the foregoing resolution was duly seconded by Member Tangen and upon vote being taken thereon , the following voted in favor thereof : Mayor Penzel , Tangen, Redpath , Edstrom and the following voted against the same : Bentley whereupon the resolution was declared duly passed and adopted and was signed by the Mayor and attested by the City Clerk. -6- Exhibit A NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN by the City Council of the City of Eden Prairie ( the City) , that it will hold a public hearing at the City Hall in the City of Eden Prairie , Minnesota , on the 2 day of February , 198 2 , at 7:30 PM M. to consider the Eden Prairie Guide Plan Update as it relates to the housing needs of the City ((( tie Housing Plan ) and a proposed program for a multifamily development ( the Program ) to be financed by the issuance of revenue bonds or notes of the City pursuant to Minnesota Statutes , Chapter 462C ( the Minnesota Housing Bond Act) . The Municipal Housing Bond Act provides that prior to issuing revenue bonds or obligations to finance a development such as the development described in the Program, the City must first develop a housing plan and hold a public hearing thereon. The Eden Prairie Guide Plan Update sets forth the housing needs of the City, the data demonstrating those needs , recommendations for housing policies , goals and specific objectives for the accomplishment of each goal and proposed target objectives and strategies . The Program describes a development , to be known as Edenvale Apartments , which will consist generally of approximately 174 rental units , parking and related facilities . Revenues of the development will be pledged to the payment of the bonds or obligations issued to finance the development ; such obligations will be payable solely from the revenues of the development and shall not constitute a debt of the City. The Program describes the need for the development and the method of financing proposed and states that the development is to be constructed pursuant to Section 462C . 05 , Subdivision 2 , of the Municipal Housing Bond Act. A copy of the Eden Prairie Guide Plan Update and a copy of the Program are on file and available for inspection in the office of the City Manager at City Hall . Dated at Eden Prairie , Minnesota , this 2 day of February 1982 By order of the City Council.. -ohn D. Frane City Clerk 1 March 1 , 1 9 8 <'3c