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ifa� Hugo14669 Fitzgerald Avenue North, Hugo, MN 5503E (651) 762-6300 www.ci.hugo.mn.us TO: Honorable Mayor Tom Weidt and Members of the City Council FROM: Ron Otkin, Finance Director SUBJECT: First Amendment to Financing Agreement - Tax -Exempt Educational Facilities Revenue Bonds (Conduit Bonds) Issued in 2015 DATE: For the City Council Meeting of June 19, 2017 REQUEST FOR AMENDMENT TO FINANCING AGREEMENT The City of Hugo is being asked to approve an amendment to the Financing Agreement related to the 2015 Educational Facilities Revenue Bonds that were issued in the amount of $8.8 million, on behalf of the Autism Opportunities Foundation (the "Borrower"), a Minnesota nonprofit corporation doing business as the Minnesota Autism Center. The bond proceeds were used to (i) refund the Borrower's existing taxable debt related to the acquisition of land and the purchase of an existing structure in 2014 acquired for the purpose of establishing a private school to service students grades 4-12 diagnosed with autism spectrum disorder ("ASD") and (ii) financed the acquisition, construction, and equipping of an approximately 48,000 square foot two-story school building, that was joined with the existing facility. The school serves primarily high school students with ASD and is located at 2020 Silver Bell Road in Eagan, Minnesota. AMENDMENT The amendment clarifies and sets the level of premium the borrower (Minnesota Autism Center) shall pay to the bond holder (Wells Fargo Bank) in the event of early redemption of any or all of the bonds that were issued in 2015. CITY OF HUGO APPROVAL Although the amendment was agreed to between Wells Fargo Bank and the Minnesota Autism Center, any amendment to the Financing Agreement must be approved by the City Council since the City of Hugo issued the bonds. RECOMMENDATION Briggs and Morgan, the City's bond counsel, has reviewed this request and finds it to be a proper use of the City's authority. Thus, the Finance Department recommends that the City Council approve the request. Briggs and Morgan has drafted the attached RESOLUTION PROVIDING FOR THE FIRST AMENDMENT TO EDUCATIONAL FACILITY REVENUE BOND (MINNESOTA AUTISM CENTER PROJECT), SERIES 2015 AND AUTHORIZING THE EXECUTION OF DOCUMENTS RELATED THERETO for City Council consideration.