04-24-2024 Council Packet - Laserfiche WebLink

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STAFF REPORT TO: Mayor Fischer and Members of the City Council FROM: Chris Heineman, City Administrator Sam Magureanu, Finance Director DATE: April 24, 2024 RE: Resolution Calling for Public Hearing for Issuance of a Conduit Revenue Note by the City of Little Canada for Saint Paul Academy and Summit School. ACTION TO BE CONSIDERED The City Council is asked to take the following actions: 1) Conduct a Public Hearing to receive and consider feedback regarding the issuance of conduit debt by the City of Little Canada for St. Paul Academy and Summit School. 2) Consider the Adoption of a Resolution approving the issuance and sale of new capital campaign financing notes and authorizing the execution of documents relating to the Saint Paul Academy and Summit School Project. 3) Consider the Adoption of a Resolution approving and authorizing the amendment of a loan agreement related to the City’s Educational Facilities Revenue Refunding Note, Series 2017 (Saint Paul Academy and Summit School Project). BACKGROUND City staff has received a request from Saint Paul Academy and Summit School (the “Borrower”), to finance improvements to its lower school campus located in the City of Saint Paul. The City of Little Canada has previously acted as a conduit issuer for St. Paul Academy and Summit School, and this request follows our recently updated policy regarding the issuance of conduit debt. State and federal laws allow local government units to enter into arrangements to issue Notes and loan the proceeds to nonprofit corporations to finance or refinance capital expenditures. This assistance reduces borrowing costs for nonprofit corporations and enables them to provide their services more cost-effectively. Each city may issue up to $10,000,000 of its own and 501(c)(3) bonds each calendar year as bank-qualified bonds. The City of Saint Paul, the Saint Paul HRA, or the Saint Paul Port Authority do not have sufficient bank qualification capacity on their own to accommodate the Note of approximately $10,000,000 so the City of Little Canada was asked to serve as an alternative issuer for the Note. Under the federal tax law, alternative issuers are permitted, but a “nexus” between the jurisdictional city and the issuer is preferred. In this case, the Issuer is geographically proximate to the City of Saint Paul and Little Canada currently has residents who are students attending the Borrower.