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HomeMy WebLinkAbout2017.07.05 RESO 2017-23 Autism BondEXTRACT OF MINUTES OF A MEETING OF THE CITY COUNCIL OF THE CITY OF HUGO, MINNESOTA Pursuant to due call and notice thereof, a regular or special meeting of the City Council of the City of Hugo, Minnesota, was duly held at City Hall in said City on Wednesday, July 5, 2017, commencing at 5:00 P.M. The following Council Members were present: Haas, Klein, Petryk, Miron, Weidt and the following were absent: None Member Haas introduced the following resolution and moved its adoption: RESOLUTION NO. 2017-23 APPROVING ISSUANCE AND SALE OF THERAPY FACILITIES REVENUE BONDS (MINNESOTA AUTISM CENTER PROJECT) SERIES 2017 WHEREAS, the purpose of Minnesota Statutes, Chapter 469.152 to 469.165 (the "Act"), as found and determined by the Legislature, is to promote the welfare of the state by the active attraction and encouragement and development of economically sound industry and commerce to prevent so far as possible the emergence of blighted and marginal lands and areas of chronic unemployment; and WHEREAS, factors necessitating the active promotion and development of economically sound industry and commerce are the increasing concentration of population in the metropolitan areas and the rapidly rising increase in the amount and cost of governmental services required to meet the needs of the increased population and the need for development of land use which will provide an adequate tax base to finance these increased costs and the need for access to services and employment opportunities for such population; and WHEREAS, the City of Hugo, Minnesota (the "City") desires to facilitate the selective development of the community, retain and improve the tax base and help to provide the range of services, including therapy services, and employment opportunities required by the population; and the Project will assist the City and surrounding communities in achieving those objectives and will enhance the image and reputation of the community; and WHEREAS, pursuant to the Act, the full faith and credit of the City will not be pledged to the payment of the principal of, premium, if any, and interest on the Bonds (as hereinafter defined); and 8345736v2 WHEREAS, the City has received a proposal from Autism Opportunities Foundation d/b/a Minnesota Autism Center, a Minnesota nonprofit corporation (the 'Borrower"), that the City issue its revenue bonds, in one or more series, in the aggregate principal amount of up to $5,100,000 to finance the acquisition, construction, and equipping of an intensive therapy center for children and adults ages 10 to 21 diagnosed with autism spectrum disorder ("ASD"), consisting of a one-story building of approximately 19,378 square feet with classrooms, a playground area, lunch room, gym, therapy room, art room, computer lab, conference rooms, administrative space, and parking lot to be located at 2100 Silver Bell Road in the City of Eagan, Minnesota (the "Project"). The Project will be owned, operated, and managed by the Borrower; and WHEREAS, in accordance with Section 147(f) of the Internal Revenue Code of 1986, as amended (the "Code"), the City held a public hearing on June 5, 2017 on the issuance of revenue bonds of the City to finance the Project and adopted Resolution No. 2017-17 approving the issuance of the Bonds; and WHEREAS, subsequent to adoption of Resolution No. 2017-17,it was discovered that, do to no error by the City, notice for a public hearing was not timely published, necessitating a new public hearing; and WHEREAS, in accordance with Section 147(f) of the Code, the City held a public hearing on the date hereof on the issuance of revenue bonds of the City to finance the Project; and WHEREAS, in accordance with Section 147(f) of the Code, the City has been advised by the Borrower that the City of Eagan held a public hearing on June 6, 2017 on the Project and gave its approval to the issuance of the Bonds by the City; and WHEREAS, based on representations of the Borrower, no public official of the City has either a direct or indirect financial interest in the Project nor will any public official either directly or indirectly benefit financially from the Project. NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Hugo, as follows: 1. Resolution No. 2017-17 adopted on June 5, 2017 is hereby amended and restated as set forth in this resolution. 2. The Borrower has proposed that the City issue its Therapy Facilities Revenue Bonds (Minnesota Autism Center Project), Series 2017, which may be in one or more series and either as notes or bonds (the 'Bonds"), in an amount not to exceed $5,100,000 to finance the costs of the Project, and to sell the Bonds to Wells Fargo Bank, National Association (the "Purchaser"), as provided herein. OA 8345736v2 3. The Bonds will be issued by the City pursuant to this Resolution and the Financing Agreement (as described below). 4. Pursuant to the terms of a Financing Agreement expected to be dated as of July 1, 2017, between the City, the Borrower, and the Purchaser (the "Financing Agreement"), the City will loan the proceeds of the Bonds to the Borrower to finance the Project. 5. Forms of the following documents have been submitted to the City Council: (a) Financing Agreement; (b) Financing Agreement Assignment; and (c) Form of Bonds. The foregoing documents are hereafter referred to as the 'Bond Documents." 6. It is hereby found, determined and declared that: (a) the issuance and sale of the Bonds, the execution and delivery by the City of the Bond Documents and the performance of all covenants and agreements of the City contained in the Bond Documents and of all other acts and things required under the constitution and laws of the State of Minnesota to make the Bond Documents and the Bonds valid and binding obligations of the City in accordance with their terms, are authorized by the Act; (b) it is desirable that the Bonds be issued by the City upon the terms set forth in the Resolution; (c) the basic payments under the Financing Agreement are fixed to produce revenue sufficient to provide for the prompt payment of principal of, premium, if any, and interest on the Bonds issued under this Resolution when due, and the Financing Agreement and Resolution also provide that the Borrower is required to pay all expenses of the operation and maintenance of the Project, including, but without limitation, adequate insurance thereon and insurance against all liability for injury to persons or property arising from the operation thereof, and all taxes and special assessments levied upon or with respect to the Project premises and payable during the term of the Financing Agreement and Resolution; (d) under the provisions of the Act and as provided in the Financing Agreement and this Resolution, the Bonds are not to be payable from or charged upon any funds other than the revenue pledged to the payment thereof; the City is not subject to any liability thereon; no holder of any Bonds shall ever have the right to compel any exercise by the City of its taxing powers to pay any of the Bonds or the interest or premiums thereon, or to enforce payment thereof against any property of the City except the interests of the City in the Financing Agreement which have been assigned to the Purchaser under the Financing Agreement; the Bonds shall not constitute a charge, lien, or encumbrance, legal or equitable upon any property of the City except the interests of the City in the Financing Agreement which have been assigned to the Purchaser under the Financing Agreement; the Bonds shall recite that the Bonds are issued without the faith and credit or the taxing powers of the state or its political subdivisions pledged 3 8345736v2 thereto, and that the Bonds, including interest thereon, are payable solely from the revenues pledged to the payment thereof; and, the Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation. 7. The forms of the Bond Documents and exhibits thereto are approved substantially in the form submitted. The Bond Documents, in substantially the forms submitted, are directed to be executed in the name and on behalf of the City by the Mayor and the City Administrator. Any other documents and certificates necessary to the transaction described above shall be executed by the appropriate City officers. Copies of all of the documents necessary to the transaction herein described shall be delivered, filed, and recorded as provided herein and in the Bond Documents. 8. The City shall proceed forthwith to issue the Bonds, in the form and upon the terms set forth in the Financing Agreement. The Bonds will be purchased on substantially the terms set forth in the Financing Agreement which has been submitted to the City in connection with this Resolution. The Mayor and City Administrator are authorized and directed to prepare and execute the Bonds as prescribed in the Financing Agreement and to deliver them to the Purchaser. 9. The Mayor, City Administrator, and other officers of the City are authorized and directed to prepare and furnish to the Purchaser certified copies of all proceedings and records of the City relating to the Bonds, and such other affidavits and certificates as may be required to show the facts relating to the legality of the bonds as such facts appear from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the City as to the truth of all statements contained herein. 10. The approval hereby given to the various documents referred to above includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by the Bond Counsel and the City officials authorized herein to execute said documents prior to their execution; and said City officials are hereby authorized to approve said changes on behalf of the City. The execution of any instrument by the appropriate official or officials herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. 11. The approval hereby given to the Bond Documents and the various other documents referred to in paragraph 5 above includes approval of (a) such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by Bond Counsel, the City Attorney and the City officials authorized herein to execute said documents prior to their execution and (b) such additional documents, agreements or certificates as may be necessary and appropriate in connection with the Bond Documents and with the issuance and sale of the Bonds and approved by Bond Counsel and City officials authorized herein to execute said documents prior to their execution; and said Bond Counsel and City officials are hereby authorized to approve said changes or additional documents, agreements or certificates on behalf of the City. The execution of any instrument by the appropriate officer or officers of the City herein LI 8345736v2 authorized shall be conclusive evidence of the approval of such documents in accordance with the terms thereof and hereof. In the absence (or inability) of the Mayor or the City Administrator, any of the documents authorized by this Resolution to be executed by them may be executed by any other officer of the City as, in the opinion of the City Attorney, may act on their behalf. 12. In order to qualify the Bonds as "qualified tax-exempt obligations" within the meaning of Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (the "Code"), the City hereby makes the following factual statements and representations; (a) the Bonds are not treated as "private activity bonds" under Section 265(b)(3) of the Code; (b) the City hereby designates the Bonds as qualified tax-exempt obligations for purposes of Section 265(b)(3) of the Code; (c) the reasonably anticipated amount of tax-exempt obligations (other than obligations described in clause (ii) of Section 265(b)(3)(C) of the Code) which will be issued by the City (and all entities whose obligations will be aggregated with those of the City) during the calendar year 2017 will not exceed $10,000,000; (d) not more than $10,000,000 of obligations issued by the City during the calendar year 2017 have been designated for purposes of Section 265(b)(3) of the Code; and (e) the aggregate face amount of the Bonds does not exceed $10,000,000. 13. The financing of the Project by the issuance of the Bonds by the Borrower is subject to, among other things, (a) the approval of the Project by Eagan and the Minnesota Department of Employment and Economic Development ("DEED") and (b) review and approval of the proposed Project by Bond Counsel. Submission of the required application to DEED is hereby authorized and directed. 14. The Borrower has advised the City that it expects to incur expenditures with respect to the Project prior to the date of issuance of the Bonds, and that it reasonably intends to reimburse itself for such expenditures from the proceeds of the Bonds. This resolution is intended to constitute a declaration of official intent for purposes of Tres. Reg. § 1.150 2 and any successor law, regulation or ruling. In anticipation of the approval of the Project by DEED and all other necessary entities and the issuance of the Bonds to finance all or a portion of the Project, and in order that completion of the Project will not be unduly delayed when approved, the City hereby authorizes the Borrower, in accordance with the provisions of the Act and subject to the terms and conditions imposed by the Purchaser, to provide for the acquisition, construction, and equipping of the Project by such means as shall be available to the Borrower and in the manner determined by the Borrower, and without advertisement for bids as may be required for the construction and acquisition of other municipal facilities; the City hereby ratifies, affirms, and approves all actions heretofore taken by the Borrower consistent with and in anticipation of such authority; and the Borrower is hereby authorized to make such expenditures and advances toward payment of that portion of the costs of the Project to be financed from the proceeds of the Bonds as the Borrower considers necessary, including the use of interim, short - 5 8345736v2 term financing, subject to reimbursement from the proceeds of the Bonds if and when delivered but otherwise without liability on the part of the City. 8345736v2 The motion for the adoption of the foregoing resolution was duly seconded by member Miron, and after full discussion thereof and upon vote being taken thereon, the following voted in favor thereof. Haas, Klein, Petryk, Miron, Weidt and the following voted against the same: None whereupon said resolution was declared duly passed and adopted. 7 8345736v2 STATE OF MINNESOTA ) COUNTY OF WASHINGTON ) CITY OF HUGO ) I, the undersigned, being the duly qualified and acting City Administrator of the City of Hugo, Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the original thereof on file in my office, and that the same is a full, true, and complete transcript of the minutes of a meeting of the City Council of said City duly called and held on the date therein indicated, insofar as such minutes relate to giving approval on a proposed educational facilities bond issue. WITNESS my hand this 5t' day of July, 2017. , 0..6 �-- tI City mi ator N. 8345736v2