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HomeMy WebLinkAboutResolution - 86-315 - Adopting an Amended Housing Plat for Prairie Village Apartments - RESOLUTION NO . 86-315 Councilmember Red ' ath _ introduced the following resolution and moved its adoption : RESOLUTION RELATING TO THE ISSUANCE OF REVENUE BONDS OR NOTES PURSUANT TO MINNESOTA STATUTES , CHAPTER 462C, FOR THE PURPOSE OF FINANCING A MULT1:FPti1?LY HOUSING DEVELOPMENT ; ADOPTING AN AMENDED MULTIFAMILY HOUSING PROGRAM; AUTHORIZING SUBMISSION OF THE HOUSING PROGRAM TO THE MINNESOTA HOUSING FINANCE AGENCY FOR REVIEW AND APPROVAL. BE IT RESOLVED by the City Council of the City of Eden Prairie, Minnesota ( the City ) , as follows : Section 1 . Recitals 1 . 01 . On October 1 , 1985 , the City adopted Resolutions 85-- 224 and 85-225 ( the Resolutions ) , pursuant to which, among other. th.ines , .i.t ( i ) adopted multifamily housing programs for Prairie Village Apartments , Phases I and II (the Programs ) , after holding a duly notice public hearing thereon; ( ii ) authorized transmission of said housing programs to the Minnesota Housing Finance Agency; and ( iii ) preliminarily approved two bond issues for Prairie Village Apartments , Phases I and II ( herein collectively referred to as the "Projects " or the "Project " ) , each in the amount of Two Million Two Hundred Twenty-six Thousand Dollars ( $2 , 226 , 000 ) . 1 . 02 . The Programs were submitted by the City to the Minnesota Housing Finance Agency for review and approval , and on December 19 , 1985 , the Board of the Minnesota Housing Finance Agency adopted Resolution No . MHFA 85- 71 , in which it was stated that the Minnesota Housing Finance Agency had failed to reject the Programs , resulting in approval of said Programs , pursuant to Minnesota Statutes , Section 462C . 04 , subd. 2 . 1 . 03 . The Resolutions provided that all commitments of the City stated in those Resolutions were subject to the condition that by October 1 , 1986 , the City and Mandara Company, a Minnesota corporation , or a limited partnership of which it will be the general partner (Mandara ) must have agreed to mutually acceptable terms and conditions of the Loan Agreement pursuant to which Mandara was to agree to pay to the City principal , premium, if any, and interest on -the bonds or notes pursuant to which the Projects were to be financed, and of the other instruments and proceedings relating to said bonds or notes and their issuance and sale . 1 . 04 . No such agreement was reached among the City and t Mandara , and no extension of the October 1 , 1986 , date was approved by the City . It is , therefore , necessary for the City to approve the proposed bonds and notes to finance the Projects and to approve a revised housing program ( the Amended Program) relating to the financing of the Project , after a duly noticed public hearing relating to the adoption of said Amended Program. 1 . 05 . At the time of adoption of the Resolutions , Mandara contemplated the Project would be developed in two phases , one phase of market rate rental housing, and one phase of housing for elderly persons . The development of the Project in two phases as provided above depended upon whether Mandara could obtain approval from the Minnesota Housing Finance Agency (MHFA ) tc include one of the two phases of the Project in a MHFA Bond issue. Mandara has not obtained such approval from the MHFA, and now intends to finance Phases I and II of the Project with only one issue of bonds or notes . Prairie Village Limited Partnership, a Minnesota limited partnership ( the Developer ) , whose general partner is Mandara , intends to develop the Project . 1 . 06 . Under Minnesota Statutes , Chapter 462C, as amended ( the Act ) , the City is authorized to issue and sell revenue bonds or obligations to make or purchase loans to finance one or more multifamily housing developments within its boundaries . 1 . 07 . Representatives of the Developer have advised this j Council that the Developer proposes to construct a multifamily { residential housing development on approximately eight and one- quarter acres of land owned by the Developer, located just east of the northeast corner of the intersection of Highway 5 and County Road 4 in the City, composed of 112 apartment units and other functionally related and subordinate facilities and to operate the facilities as a multifamily housing development under the Act, to be known as Prairie Village Apartments . Either ( i ) at least twenty percent ( 20% ) of the units will be specifically reserved for tenants whose incomes are no greater than fifty percent ( 500b ) of the area median income; or ( ii ) at least forty percent ( 40% ) of the units will be specifically reserved for tenants whose incomes are no greater than sixty percent ( 60% ) of the area median income . Determinations as to whether a unit meets the requirements of ( i ) or ( ii ) , above, will include adjustments for family size . Development and financing costs of the Project are presently estimated by representatives of the Developer to be approximately Seven Million Two Hundred Thousand Dollars ( $7 , 200 , 000 ) . 1 . 08 . Representatives of the Developer have requested that the City issue its revenue bonds or other obligations in the approximate aggregate face amount of Five Million Seven Hundred Fifty Thousand Dollars ( $5 , 750 , 000 ) ( the Bonds or dotes ) , pursuant to the Act, and make a loan of the proceeds of the sale of the Bonds or dotes to the Developer for the acquisition of land for and the construction and equipping of the Project , 2 . subject to agreement by the Developer , or other persons or institutions , to promptly pay the pr.inci_pal of , premium, if any , and interest on the Bond or Notes . 1 . 09 . The City has been advised by representatives of the Developer that conventional conunerciai financing of the costs of the Project is available only on a 1i_m.ited basis and at such high costs of borrowing that the economic feasibility of the Project would be significantly affected , but that with the aid of municipal financing the Project will be more economically feasible . 1 . 10 . This Council has been advised by representatives of The Chicago Corporation , representing the Developer , that on the basis of information available to them, the Project is economically feasible , and the Bonds or Notes could be successfully issued and sold . 1 . 11 . Neither the f"- ll faith and credit nor the taxing powers of the City nor any property of the City will be pledged to the payment of the Bonds or Notes . The Bonds or Notes are to be maid from the revenues of the Project . 1 . 12 . The applicant 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 carried to comiDletion ; with the Project whether or not the Project is approved by the City; and whether or not the Bonds or Notes are executed and issued . 1 . 13 . The adoption of this resolution does not constitute a guarantee or a firm commitment that the City will issue the Bonds or Notes as requested by the applicant . The City retains the right in its sole discretion to withdraw from participation and accordingly not issue the Bonds or Notes 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 Notes or should the parties to the transaction be unable to reach agreement as to the terms and conditions of any of the documents required .for the transaction . 1 . 14 . All commitments of the City expressed herein are subject to the condition that by December 2 , 1987 , the City and the applicant shall have agreed to mutually acceptable terms and conditions of the Loan Agreement pursuant to which the Developer will agree to pay to the City principal , premium, if any, and interest on the Bonds or Notes , and of the other instruments and proceedings relating to the Bonds or Notes 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 or Notes are not sold within such time, this resolution shall expire and be of no further effect . 3 . 1 . 15 . The City has caused to be prepared the Amended Program for the proposed Project under the Act which has been presented to this Council , and which contains information demonstrating the need for the Project, stating the method of financing proposed and that the Project is to be constructed and equipped pursuant to Subdivision 2 , Section 462C . 05 of the Act . 1 . 16 . Pursuant to the requirements of the Act and Section 147 ( f ) of the Internal Revenue Code of 1986, as amended (the Code ) , a public hearing has been held relating to the Program proposed by the Developer under the Act, .including the proposed issuance of the Bonds or Notes , after proper_ publication of notice of the public hearing in accord with the requirements of the Act and the Code . 1 . 17 . The City will request an allocation from the State of Minnesota ' s Competitive Pool under the Federal Volume Limitation Act . Because the allocation, if made, will not be made until. the second to the last Monday of December 1986 , the City will request an extension of the expiration date of the Certificate of Allocation as permitted under Minnesota Statutes , Section 474A. 13 , Subd . 3 ( 4 ) . The Federal Volume Limitation Act allows for the issuing authority to elect to carry forward unused allocation for certain specified purposes . Among those purposes , is the purpose of issuing bonds referred to in one of the clauses of Section 141 (d) ( 1 ) (A) of the ( Internal Revenue Code of 1986 . Section 141 (d) ( 1 ) (A) is a ( reference to exempt facility bonds . Under Section 142 of the Internal Revenue Code of 1986 , exempt facilities are defined to include qualified residential rental projects . The Project will be a qualified residential rental project under the Internal Revenue Code of 1986 . Section 2 . Approval and Authorization 2 . 01 . The Amended Program is hereby adopted by the City pursuant to Section 462C . 05 , Subd. 5 of the Act . The Mayor and the other officers , employees , and agents of the City are hereby authorized to prepare and execute the required certifications and to take such other actions as they deem necessary or advisable in order to submit the Amended Program 'to the Minnesota Housing Finance Agency for review and approval in accordance with the provisions of the Act . 2 . 02 . Upon receipt of a Certificate of Allocation from the Minnesota Department of Energy and Economic Development, the Mayor and the other officers , employees , and agents of the City are hereby authorized to prepare and execute the required election forms and to take such other actions as they deem necessary to carry forward the allocation for the Project to allow use of the allocation in 1987 . 4 . Adopted by the City Council of the City of Eden Prairie, Minnesota , this 16th day of December , 1986 . Mayor ATTEST: Cit erk (� The Motion for the adoption of the foregoing resolution was duly seconded by Councilmember Anderson and upon vote being taken thereon, the following voted in favor thereof : Mayor P(-ters;.a o �ncilmemhers Anderson, Bentlev , Pidcock, and Redpath and the following voted against the same : Nnne- Whereupon the resolution was declared duly passed and adopted and was signed by the Mayor and attested by the City Clerk. STATE OF MINNESOTA) ) ss . COUNTY OF HENNEPIN) I , the undersigned, being the duly qualified and appointed Clerk of the City of Eden Prairie, Minnesota, hereby certify that I have carefully compared the foregoing resolution adopted at a regular meeting of the City Council of said City held on December 2 , 1986 , with the original thereof on file in my office, and the same is a full , true, and complete transcript thereof . Witness , my hand officially as such Clerk and the corporate seal of the City this day of , 1986 . John Frane City Clerk ( SEAL) SOK :CT6 5 .