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HomeMy WebLinkAbout2005-183 Council Resolution• • • CITY OF LINO LAKES, MINNESOTA RESOLUTION NO. 05-183 RESOLUTION RELATING TO THE ISSUANCE OF REVENUE NOTES FOR THE BENEFIT OF YMCA OF GREATER SAINT PAUL UNDER MINNESOTA STATUTES, SECTIONS 469.152 - 469.165; GRANTING PRELIMINARY APPROVAL THERETO, ESTABLISHING COMPLIANCE WITH CERTAIN REIMBURSEMENT REGULATIONS UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED; AND TAKING CERTAIN OTHER ACTIONS WITH RESPECT THERETO WHEREAS, Pursuant to Minnesota Statutes, Sections 469.152 to 469.165, as amended (the "Act "), the City of Lino Lakes, Minnesota (the "City ") is authorized to carry out the public purposes described therein and contemplated thereby by issuing its revenue notes or other obligations to finance, in whole or in part, the cost of the improvement, betterment, and extension of an existing revenue producing enterprise, for the public purposes expressed in the Act; and WHEREAS, YMCA of Greater Saint Paul, a Minnesota nonprofit corporation (the "Borrower "), has submitted an application to the City requesting the issuance of revenue notes pursuant to the Act, in a principal amount not to exceed $3,000,000, for a project generally described as the construction and equipping of an approximately 37,000 square feet recreational facility (the "Project "), to be constructed on land located in the City and legally described as Lot 1, Block 1, the Village No. 3 Addition; and WHEREAS, pursuant to the requirements of Section 469.154 of the Act, an application to the Department of Employment and Economic Development (the "DEED Application ") for the Project and the issuance of revenue notes to finance the:Project.(the "Notes "), has been prepared and is on file with the City; and WHEREAS, on November 28, 2005, the City conducted a public hearing on the DEED Application, the Project, and the issuance of the Notes, and notice of such public hearing was published as required by Minnesota Statutes, Section 469.154, Subdivision 4, of the Act, and Section 147(f) of the Internal Revenue Code of 1986, as amended. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Lino Lakes, Minnesota (the "City Council "): Section 1. Notice of Public Hearing. The form of Notice of Public Hearing, on file with the City on the date hereof, as published in the Quad Community Press on November 1, 2005, is hereby ratified. A public hearing before the City Council was conducted on Monday, November 28, 2005, in accordance with the requirements of the Act, and Section 147(f) of the Internal Revenue Code of 1986, as amended. Section 2. DEED Application. In accordance with Section 469.154 of the Act, the Administrator of the City is hereby authorized and directed to submit the proposal for the Project to the Commissioner of the Department of Employment and Economic Development ( "DEED "). The Administrator and other officers, employees and agents of the City are hereby authorized to provide DEED with any information needed for this purpose, and the Administrator is authorized to initiate and assist in the preparation of such documents as may be appropriate to the Project, if it is approved • • • Section 3. Preliminary Approval. The City hereby gives preliminary approval to the issuance of the Notes in the original aggregate principal amount not to exceed $3,000,000 to finance all or a portion of the costs of the Project, subject to final approval following the preparation of note documents, and subject to final determination by the City that the financing of the Project and the issuance of the Notes are in the best interest of the City. City staff, Kennedy & Graven, Chartered, acting as Bond Counsel, and other agents and consultants of the City are hereby authorized and directed to do all things and take all actions as may be necessary or appropriate to prepare and review necessary documents relating to the Project and the Notes to be issued in connection therewith. The Administrator and other officers, employees and agents of the City are hereby authorized to assist Bond Counsel in the preparation of such documents. Section 4. Reimbursement of Costs under the Code. 4.1. The United States Department of the Treasury has promulgated final regulations governing the use of the proceeds of tax - exempt notes, such as the Notes, all or a portion of which are to be used to reimburse the City or a borrower from the City for project expenditures paid prior to the date of issuance of such Notes. Those regulations, Treasury Regulations, Section 1.150 -2 (the "Regulations "), require that the City adopt a statement of official intent to reimburse an original expenditure not later than sixty (60) days after payment of the original expenditure. The Regulations also generally require that the Notes be issued and the reimbursement allocation made from the proceeds of the Notes occur within eighteen (18) months after the later of: (i) the date the expenditure is paid; or (ii) the date the Project is placed in service or abandoned, but in no event more than three (3) years after the date the expenditure is paid. The Regulations generally permit reimbursement of capital expenditures and costs of issuance of the Notes. 4.2. To the extent any portion of the proceeds of the Notes will be applied to expenditures with respect to the Project, the City reasonably expects to reimburse itself or the Borrower for the expenditures made for costs of the Project from the proceeds of the Notes after the date of payment of all or a portion of such expenditures. All reimbursed expenditures shall be capital expenditures, a cost of issuance of the Notes, or other expenditures eligible for reimbursement under Section 1.150- 2(d)(3) of the Regulations and also qualifying expenditures under the Act. Based on representations by the Borrower, other than (i) expenditures to be paid or reimbursed from sources other than the Notes; (ii) expenditures constituting preliminary expenditures within the meaning of Section 1.150- 2(f)(2) of the Regulations; or (iii) expenditures in a "de minimus" amount (as defined in Section 1.150- 2(f)(1) of the Regulations), no expenditures with respect to the Project (that are proposed to be financed with the proceeds of the Notes) have been made by the Borrower or the City more than sixty (60) days before the date of adoption of this resolution. 4.3. Based on representations by the Borrower, as of the date hereof, there are no funds of the Borrower reserved, allocated on a long term -basis or otherwise set aside (or reasonably expected to be reserved, allocated on a long -term basis or otherwise set aside) to provide permanent financing for the expenditures related to the Project, other than proceeds of the Notes issued by the City together with an equity contribution of the Borrower in an amount up to approximately $4,300,000 to construct the Project. This resolution, therefore, is determined to be consistent with the budgetary and financial circumstances of the Borrower as it exists or is reasonably foreseeable on the date hereof. • • Section 5. Costs. The Borrower will pay the administrative fees of the City, or, upon demand, reimburse the City for payment of costs incurred by the City in connection with the Project and the issuance of the Notes, whether or not the Notes are issued. The City acknowledges that the amount of administrative fees of the City to be paid by the Borrower has not been determined as of the date of this resolution. The Borrower and the City will negotiate, as part of the note financing transaction, the amount of the administrative fees that the City will charge the Borrower relating to the Project and the issuance of the Notes by the City. Section 6. Commitment Conditional. The adoption of this resolution does not constitute a guarantee or a firm commitment that the City will issue the Notes as requested by the Borrower. If based on comments received at the public hearing to be held pursuant to this resolution, or other information made available to or obtained by the City during its review of the Project, it appears that the Project or the issuance of Notes to finance or refinance the costs thereof is not in the public interest or is inconsistent with the purposes of the Act or the Code, the City reserves the right not to give final approval to the issuance of the Notes. The City also retains the right, in its sole discretion, to withdraw from participation and accordingly not issue the Notes should the City Council, at any time prior to the issuance thereof, determine that it is in the best interests of the City not to issue the Notes or should the parties to the transaction be unable to reach agreement as to the terms and conditions of any of the documents for the transaction. Section 7. Effective Date. This Resolution shall be in full force and effect from and after its passage. Passed and adopted this 28th day of November, 2005. TNF CITY OF LINO LAKES, MINNESOTA Mayor Attest: Cit}/Administrator LN 140 -91 (JAE) 269759 vl AGENDA ITEM 2A • STAFF ORIGINATOR Al Rolek MEETING DATE November 28, 2005 TOPIC Public Hearing for and Consideration of Resolution 05 -183 Relating to the Issuance of Revenue Notes for the Benefit of YMCA of Greater Saint Paul VOTE REQUIRED BACKGROUND' Simple Majority The City of Lino Lakes is involved in a partnership with the YMCA of Greater St. Paul for the construction of a YMCA facility in the Legacy at Woods Edge development. The YMCA has made a request to the City to issue tax exempt revenue notes to finance a portion of the project cost. The City Council set a public hearing for this evening to take public comment on the issuance of up to $3,000,000 in tax - exempt revenue notes for the benefit of the YMCA. Following the public hearing, the City Council is to consider Resolution 05 -183. Approval of the resolution grants preliminary approval to the issuance of the revenue notes, authorizes and directs submission of the proposal to the Department of Employment and Economic Development ( "DEED "), authorizes an intent to reimburse costs with revenue note proceeds under IRC section 1.150 -2, and calls for the YMCA to reimburse the City for costs incurred in connection with the project and the issuance of the notes. The approval of Resolution 05 -183 continues the process for the issuance of the revenue notes and a closing on the financing in late December of this year. Final approval for the issuance is scheduled for the December 12, 2005, City Council meeting. It is staff's recommendation that the City Council approve Resolution 05 -183 Relating to the Issuance of Revenue Notes for the Benefit of YMCA of Greater Saint Paul. OPTIONS` 1. Adopt Resolution 05 -183. 2. Refer to Staff for further review. 3. Deny Resolution 05 -183. RECOMMENDATION'; Option 1 w Certification of Resolution No. 05 -183 Councilmember Reinert introduced Resolution No. 05 -183 at the regularly scheduled meeting of the Lino Lakes City Council held on November 28, 2005, and moved its adoption. The motion for adoption of the foregoing resolution was duly seconded by Councilmember Dahl and upon vote being taken thereon, the following voted in favor thereof: Reinert, Dahl, Bergeson, Carlson and Stoltz. The following voted against same: None. Whereupon said resolution was declared passed and adopted. STATE OF MINNESOTA ) COUNTY OF ANOKA ) CITY OF LINO LAKES ) I, the undersigned, being the duly qualified Acting City Clerk of the City of Lino Lakes, Minnesota, do hereby certify that the attached document is a true copy of Resolution No. 05 -183 with the original thereof on file in the City Clerk's office, and the same is a full, true and complete copy insofar as the same relates to: CERTIFICATION OF RESOLUTION NO. 05 -183 RELATING TO THE ISSUANCE OF REVENUE NOTES FOR THE BENEFIT OF YMCA OF GREATER SAINT PAUL UNDER MINNESOTA STATUTES, SECTIONS 469.152- 469.165; GRANTING PRELIMINARY A PPROVAL THERETO, ESTABLISHING COMPLIANCE WITH CERTAIN REIMBURSEMENT REGULATIONS UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED; AND TAKING CERTAIN OTHER ACTIONS WITH RESPECT THERETO. Witness my hand as said Acting City Clerk and the Corporate Seal of the City this 5th day of December, 2005. Jean M. Viger (SEAL)