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HomeMy WebLinkAboutResolution - 87-277 - Housing Plat Approval for Prairie Village Apartments/Change in identity of DevelopersConfirming Preliminary Approval to Development - RESOLUTION NO. N 7l �I Councilmember �s,,c� introduced the following resolution and moved its adoption : RESOLUTION RELATING TO THE ISSUANCE OF REVENUE BONDS OR NOTES PURSUANT TO 1INNESOTA STATUTES , CHAPTER 462C , FOR THE PURPOSE OF FINANCING A MULTIFAMILY HOUSING DEVELOPMENT; CONFIRMING PRELI14INARY APPROVAL TO THE DEVELOPMENT; APPROVING THE CHANGE IN IDENTITY OF DEVELOPER; AND AUTHORIZING NOTIFICATION OF THE MINNESOTA HOUSING FINANCE AGENCY OF SUCH CHANGE . 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 1985 Resolutions ) , pursuant to which , among other things , it ( i ) adopted multifamily housing programs for Prairie Village Apartments , Phases I and II ( the Programs ) , after holding a duly noticed public hearing thereon; ( ii ) authorized transmission of the Programs to the Minnesota Housing Finance Agency; and ( ii.i ) 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 Twentv - 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 , which stated that the Minnesota Housing Finance Agency had failed to reject the Programs , resulting in approval of the Programs, pursuant to Minnesota Statutes , Section 462C . 04, subd . 2 . 1 . 03 . On December 2 , 1986 , the City adopted Resolution 86-2.95 , pursuant to which, among other things , it gave its preliminary approval to the issuance of bonds or notes in the approximate aggregate face amount of Five Million Seven Hundred Fifty Thousand Dollars ( $5 , 750 , 000 ) (the Bonds ) , to finance a portion of the costs of Phases I and II of the Project in a single phase as one Project , subject to the City and. the Applicant agreeing to mutually acceptable terms and conditions of a loan agreement by December 2 , 1.987 . 1 . 04 . On December 16 , 1986 , the City adopted Resolution 86-315 , pursuan,_ to which, among other things , it approved an i amended multifamily housing program ( the Amended Program) and authorised submission of the Amended Program to the Minnesota Housing Finance Agency for review and approval . 1 . 05 . On January 19 , 1987 , the MHFA confirmed that the Amended Program was reviewed and not rejected , resulting in approval. of the Amended Program . 1 . 06 . A Certificate of Allocation for the Project was granted by the Minnesota Department of Energy and Economic Development on December 22 , 1986 . The expiration date of such allocation is December 2 , 1987 . A federal. volume allocation carry forward was filed on December 29 , 1986 . 1 . 07 . The original developer of the Project , the Prairie Village Limited Partnership, wishes to convey the Project to a limited partnership to be formed, whose general partners will be Wayne C . Chaney, J . Peter Jungbacker, Century Capital Group, Ltd . , and RRM., Incorporated (collectively referred to as Developer ) . It is intended that the Program and the Project will , in all other respects remain substantially the same as previously approved by the City . 1 . 08 . Under cinnesota 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 ITtore multifamily housing developments within its boundaries . 1 . 09 . The Project consists of a Multifamily residential housing developi<<ent on approximately eight and one-quarter acres of land to be acquired 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 the operation of the facilities as a multifamily housing development under the Act , to be known as Prairie Village Apartments . Either ( i ) at least twenty percent ( 200 ) of the units will be specifically reserved for tenants whose incomes are no greater than fifty percent ( 509 ) of the area median income ; or ( ii ) at least forty percent ( 400 ) of the units will be specifically reserved for tenants whose incomes are no greater than sixty percent ( 600 ) 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 . 10 . Representatives of the Developer have requested that the City approve the substitution of the Developer for the Project , issue its Bonds pursuant to the Act , and make a loan of the proceeds of the sale of the Bonds to the Developer for ( the acquisition of land for and the construction and equipping 2 . of the Project , subject to agreement by the Developer , or other persons or institutions , to promptly pay the principal of , premium, if any, and interest on the Bonds . 1 . 11 . The City has been advised by representatives of the Developer that conventional commercial financing of the costs of the Project is available only on a limited 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 . 12 . This Council has been advised by representatives of The Chicago Corporation , representing the Developer, that on t'ze basis of information available to them, the Project remains economically feasible, and the Bonds could be successfully issued and sold . 1 . 13 . Neither the full 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 . The Bonds are to be paid solely from the revenues of the Project . 1 . 14 . 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 completion , whether or not the Project is approved by the City, and whether or not the Bonds are executed and issued. 1 1 . 15 . 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 applicant . 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 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 . 16 . 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 T.jill agree to pay to the City principal , premium, if any , and interest on the Bonds , 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 glace 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 . 1 . 17 . Pursuant to the requirements of the Act and Section J 147 ( f ) of the Internal Revenue Code of 1986 , as amended ( the 3 . Code ) , a public hearing has been held relating to the Amended Program proposed by the Developer under the Act , including the proposed issuance of the Bonds or Notes and the substitution of the Developer for Prairie Village Limited Partnership as the developer , after proper publication of notice of the public hearing in accord with the regtiirements of the Act and the Code . Section 2 . Approval and Authorization 2 . 01 . :It is hereby found and determined based upon the Information presented to this Council by the representatives of the Developer that it would be in the best interests of --he City 'to .issue the Bonds under the provisions of the Act and the City ' s earlier preliminary approval in order to finance costs to be incurred by the Developer in the acquisition, construction , and equipping of the described facilities . The City hereby approves the substitution of the Developer for Prairie Village Limited Partnership as developer of the Project and confirms its ;preliminary approval to the i.ssuance of the Bonds or Notes in the approximate aggregate face amount of Five Mill-ion Seven Hundred Fifty Thousand Dollars ( $5 , 750 , 000 ) , subject to the City , the Developer, and the purchaser of the Bonds reaching definitive agreement and the provisions for their payment . 2 . 02 . The Mayor and other officers , employees , and agents of the City are hereby authorized to notify the Minnesota ( Housing Finance Agency of the substitution of the Developer for. Prairie village Limited Partnership as developer of the Project and to submit an amended multifamily housing program, if necessary . 2 . 03 . The Citv Attorney , the Mayor , the City Manager, and other officers , employees , and agents of the City are authorized , in cooperation with bond counsel , to initiate and continue , t�e preparation and revision of such documents as may be appropriate to evidence the change .in the identity of the developer , the terms of all agreements for payment of the Bonds , and the provisions for payment of the principal of , the premium, if any, and interest on the Bonds . Adopted by the City Council of the City of Eden Prairie, Minnesota , this 6th day of October , 1987 . _ Mayor , ATTEST: i Ci y rk 4 .