05-13-2020 Council Packet - Laserfiche WebLink

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12596751v1 Taft Stettinius & Hollister LLP Chicago / Cincinnati / Cleveland / Columbus / Dayton / Delaware / Denver / Indianapolis / Minneapolis / Northern Kentucky / Phoenix MEMORANDUM BY EMAIL TO: Chris Heineman, City of Little Canada City Administrator FROM: Catherine J. Courtney DATE: May 11, 2020 RE: Request from Presbyterian Homes for the City to Act as Conduit Issuer In 2018, the City of Little Canada received a request from Presbyterian Homes (the “Borrower”) that the City act as the conduit issuer for two bond issuances – one in 2018 and one in 2020 – for a project located in the City of Roseville. The City issued bonds in 2018 in the amount of $11,970,000, and the proceeds were intended to be used to demolish the Langton Place care center in Roseville and construct a new 50-bed care center in its place. The new care center has been completed. The demolition of the old care center is currently on hold, as it is being used as a temporary hospital overflow site during the pandemic. Presbyterian Homes is now ready to pursue the second bond issue and phase of the project. The proposed issue in 2020 would be approximately $45,000,000 to $50,000,000 for the purpose of refinancing the 2018 issue and to construct a town center and adjacent 80-unit senior housing facility. This expanded Langton Place campus, now known as Langton Shores, is located on County Road D in Roseville. The issuance of the 2020 Bonds will mean that the issuer could not issue its own bank- qualified bonds (although it could still issue non-bank-qualified bonds). Roseville does not expect to issue bonds for its own purposes in 2020 that it wants to designate as bank-qualified and could act as the issuer. However, because Little Canada was the issuer in 2018, the Borrower prefers that Little Canada act as the issuer again in 2020. Roseville is willing to give host approval and allow Little Canada to act as issuer. In fact, Roseville has already adopted such resolution. It is my understanding that the City has not issued, and does not expect to issue, any governmental or other 501(c)(3) bonds in 2020 and, therefore, it is not a concern that the issuance of the 2020 Bonds would eliminate the City’s ability to designate its own governmental bonds (or another 501(c)(3)’s bonds) as bank-qualified in 2020, although it could still issue bonds that do not necessitate designation as bank-qualified. The City will receive an issuer’s fee of ¼ of 1% of approximately $45,000,000 to $50,000,000 less the $29,000 fee that the City received upon the issuance of the 2018 Bonds, for