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HomeMy WebLinkAboutResolution - 84-195 - Preliminary Approval Housing Program Bonds - Eden Prairie 1 Partnership - 08/28/1984 After some discussion, Member Paul Redpath introduced the following resolution and moved its adoption : RESOLUTION NO . 84-195 RESOLUTION RELATING TO THE ISSUANCE OF REVENUE BONDS PURSUANT TO CHAPTER 462C , MINNESOTA STATUTES; GIVING PRELIMINARY APPROVAL TO THE PROJECT, ADOPTING A MULTIFAMILY HOUSING PROGRAM AND AUTHORIZING SUBMISSION OF THE HOUSING PROGRAM FOR REVIEW BE IT RESOLVED by the City Council or the City of Eden Prairie, Minnesota (tree 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 payable solely from the revenues of the development . 1 . 02 . The Act provides that , prior to issuing revenue bonds or obligations to finance 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 . On February 2 , 1982 , after thirty days published notice, this Council adopted the City of Eden Prairie ' s Comprehensive Guide Plan and Housing Assistance Plan (which is within the Housing Chapter of the Comprehensive Guide Plan) . The Comprehensive Guide Plan was approved by Metropolitan Council pursuant to Subdivision 1 of Section 402C. 04 of the Act on March 11 , 1982 . 1 . 04 . 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 csiderations stated in Section 462C . 04 of the Act . J -2- t. 1 . 05 . Eden Prairie I , Ltd . , a Texas limited partnership (the Partnership) , has advised this Council of its desire to acquire certain land located at the northwest corner of Franlow Road and Preserve Boulevard in the City and to construct and equip thereon a 252-unit rental apartment building together with parking and related facilities (the Project) . Total development and financing costs are presently estimated by the Partnership to be approximately $13 , 725 , 000 . 1 . 06 . Representatives of the Partnership 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. 07 . The City has been advised by the Partnership 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. 08 . 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 Partnership and potential purchasers of tax-exempt bonds , the Bonds could be sold at favorable rates and terms to finance the Project . 1 . 09 . 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 . 1 . 10 . A publi�hearing, duly noticed, was held at 7 : 3 0 p . m. on August -ZZ� 19 84 , in accordance with Section 103 (k) of the Internal Revenue of 1954 , as amended, on the proposal to undertake and finance the Project through the issuance of Bonds and , in accordance with Subdivision 5 of Section 462C. 05 of the Act , on the proposal to adopt a program for multifamily housing development. -3- Section 2 . Approvals : Authorization and Hearing. 2 . 01 . The action of the City Finance Director/'Clerk in causing notice of public hearing ( in substantially the form of Exhibit A hereto) to be published in the Minneapolis Star/Tribune and in the Eden Prairie News at least once not less than fifteen ( 15) nor more than thirty ( 30 ) days before the date on which a public hearing was held by this Council is hereby approved and ratified . 2 . 02 . Preliminary approval of the Project is hereby given by the City and the issuance of the Bonds for such purpose in the amount of $13 , 500 , 000 is approved. The Bonds shall not be issued until the multifamily housing program described below has been reviewed and approved as provided by the Aci- 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 pledged 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 & Whitney, 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 program for multifamily housing development ( attached as Exhibit B) , is hereby adopted by the City pursuant to Subdivision 5 of Section 462C . 05 of the Act . 2 . 04 . The Mayor , City Manager , City Finance Director/ Clerk and other officers and employees of the City are hereby authorized -to submit the program, accompanied by the Housing Plan, to the Metropolitan Council for review and comment and to the Minnesota Housing Finance Agency for review and approval pursuant to Subdivision 1 and 2 of Section 462C . 04 of the Act . 2 . 05 . 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 . -4- 2 . 06 . The Borrower 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 Program 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 . 07 . 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 Borrower . 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 Borrower 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 . 08 . 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 Borrower shall have agreed to mutually acceptable terms and conditions of the Bonds , the operative documents and of the other instruments and proceedings relating to the Bcnds 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 ,2,fst day of August , 1984 . J � Mayor Attest : e.- ,-City finance Director/Clerk The motion for the adoption of the foregoing resolution was duly seconded by Member Richard Anderson and upon vote being taken thereon, the following voted in favor b thereof: Richard Anderson, George Bentley, Paul Rednath, George Tangen and Mayor Wolfgang H. Penzel -5- EXHIBIT B PROGRAM FOR MULTIFAMILY HOUSING DEVELOPMENT UNDER CHAPTER 462C - EDEN PRAIRIE I , LTD . PROJECT Eden Prairie I , Ltd . , a Texas limited partnership (the Borrower ) intends to acquire and purchase certain land located at Franlow Road and Preserve Boulevard in the City of Eden Prairie, Minnesota (the City) , for the purpose of constructing thereon a 252-unit rental apartment building (the Project ) . Unit size composition of the Project will be as follows : 174 one-bedroom units and 78 two-bedroom units . Consistent with the housing needs of the City described in the Eden Prairie Comprehensive Guide Plan ( the Comprehensive Plan) , the Project will enable the City to meet its two housing goals stated in the Comprehensive Plan: encourage a variety of housing types and prices through innovative architectural and land use and encourage low income housing throughout the City . The P l as Elements chapter of the housing section of the Comprehensive Plan calls for continued cooperation between the public sector and private industry to insure the production of modest cost housing for middle income households. The Project will be designed to be affordable by persons and families with adjusted gross income not in excess of the limits set forth in Section 462C. 03 , Subdivision 2 , Minnesota Statutes and by other persons and families to the extent necessary to further a policy of economic integration. At least 51 units in the Project will be held for occupancy by families or individuals with adjusted gross income not in excess of 80 percent of the median family income estimated by the United States Department of Housing and Urban Development (HUD) for the Minneapolis-St . Paul standard metropolitan statistical area and at least 139 units in the Project will be held for occupancy by families or individuals whose adjusted gross income does not exceed 66 times the gross rental for the applicable dwelling unit , provided such gross rental shall not exceed 120 percent of the Fair Market Rents for the geographical area in which the Project is located as determined and adjusted from time to time by HUD . The remainder of the units in the Project will be occupied by individuals and families without regard to income limits . The authorization of revenue bonds to finance the Project will make the Project feasible . _8_ EXHIBIT B PROGRAM FOR IQULTIFAMILY HOUSING DEVELOPMENT UNDER CHAPTER 462C - EDEN PRAIRIE I , LTD . PROJECT Eden Prairie I , Ltd. , a Texas limited partnership (the Borrower ) intends to acquire and purchase certain land located at Franlow Road and Preserve Boulevard in the City of Eden Prairie , Minnesota (the City) , for the purpose of constructing thereon a 252-unit rental apartment building (the Project ) . Unit size composition of the Project will be as follows : 174 one-bedroom units and 78 two-bedroom units . Consistent with the housing needs of the City described in the Eden Prairie Comprehensive Guide Plan (the Comprehensive Plan) , the Project will enable the City to meet its two housing goals stated in the Comprehensive Plan : encourage a variety of housing types and prices through innovative architectural and land use and encourage low income housing throughout the City. The Plan Elements chapter of the housing section of the Comprehensive Plan calls for continued k cooperation between the public sector and private industry to insure the production of modest cost housing for middle income households . The Project will be designed to be affordable by persons and families with adjusted gross income not in excess of the limits set forth in Section 462C . 03 , Subdivision 2 , Minnesota Statutes and by other persons and families to the extent necessary to further a policy of economic integration. At least 51 units in the Project will be held for occupancy by families or individuals with adjusted gross income not in excess of 80 percent of the median family income estimated by the United States Department of Housing and Urban Development (HUD) for the Minneapolis-St . Paul standard metropolitan statistical area and at least 139 units in the Project will be held for occupancy by families or individuals whose adjusted gross income does not exceed 66 times the gross rental for the applicable dwelling unit , provided such gross rental shall not exceed 120 percent of the Fair Market Rents for the geographical area in which the Project is located as determined and adjusted from time to time by HUD. The remainder of the units in the Project will be occupied by individuals and families without regard to income limits . The authorization of revenue bonds to finance the Project will make the Project feasible . _8_ It is anticipated that housing development revenue bonds of the City will be issued and sold pursuant to Section 462 . 07, Minnesota Statutes , for the purpose of providing construction and long-term financing for the Project , in the aggregate principal amount of approximately $13 , 500 , 000 , which is the amount presently estimated to be necessary to pay a portion of total development and financing costs . 1 1 1 •1 I -9- 4