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<br /> <br /> STAFF REPORT <br /> <br /> <br /> <br />TO: Mayor Keis and Members of City Council <br /> <br />FROM: Chris Heineman, City Administrator <br /> <br />DATE: December 14, 2022 <br /> <br />RE: Conduit Debt Index Rate Amendment for St. Paul Academy <br /> <br />ACTION TO BE CONSIDERED: <br />Resolution approving the modification of the note for St. Paul Academy to change the interest rate index <br />from a LIBOR-based rate, which will no longer be available as of June 2023. <br /> <br />BACKGROUND: <br />City staff was contacted by the City of Little Canada’s bond attorney Catherine J. Courtney at Taft <br />regarding a conduit debt note that was issued for St. Paul Academy for the Summit School project in <br />2018. Many variable rate tax-exempt issues used LIBOR as the applicable index, and it has become <br />necessary to amend those obligations to a new rate index due to the elimination of the LIBOR index in <br />June, 2023. The Minnesota Educational Facilities Revenue Refunding Note that was issued for the Saint <br />Paul Academy and Summit School project utilized the LIBOR rate index. <br /> <br />The City of Little Canada, as the issuer of the note, is being asked to approve a resolution to modify the <br />terms of the note so that the lender may designate a substitute comparable index. The holder of that <br />note, Bremer Bank, National Association has requested an amendment of the note to allow for this <br />change. Bremer Bank intends to replace the LIBOR index with the 10 Year Federal Home Loan Bank <br />Rate as published by the Federal Home Loan Bank of Des Moines as of the date of determination. Similar <br />to previous conduit debt issuance, there is no liability for the City of Little Canada by taking this action. <br />The following attachments are included related to the St. Paul Academy note: <br />a. Resolution approving the modification of the note for St. Paul Academy to change the interest <br />rate index from a LIBOR-based rate, which will no longer be available as of June 2023. <br />b. Allonge to note. <br />c. Notice letter regarding change to interest rate index. <br /> <br />RECOMMENDED ACTION: <br />City staff recommends approval of a Resolution approving the modification of the note for St. Paul <br />Academy to change the interest rate index from a LIBOR-based rate, which will no longer be available <br />as of June 2023.