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MEETING DATE:
AGENDA #:
PREPARED BY:
AGENDA ITEM:
DISCUSSION:
ISSUES:
CITY COUNCIL AGENDA REPORT
October 15, 2001
9B
Frank Boyles, City Manager
CONSIDER APPROVAL OF A RESOLUTION OF SUPPORT FOR CONDUIT
BOND FINANCING OF THE ST. MICHAEL'S CATHOLIC SCHOOL
IMPROVEMENT PROJECT.
History: As the Council is aware, St. Michael's school has recently completed a
significant expansion of their school facilities. Initially, the Church approached the
City to obtain conduit bond financing. Because of the statutorily defined cap on
the issuance of bank qualified bonds, combined with the potential need for
bonding for other projects within the City, the Council was unable to grant St.
Michael's request.
Periodically, the Catholic Finance Corporation works together with a public entity
to obtain conduit bond financing. St. Michael Catholic school has worked with the
Catholic Finance Corporation to receive conduit bond financing. The two entities
have approached Scott County which recently adopted a policy on this subject.
Current Circumstances: St. Michael's Catholic school, the Catholic Finance
Corporation, and Scott County have concurred that the County has sufficient
capacity under its statutory caps to consider conduit bond financing for this
project. Under the statutory guidelines of conduit bond financing it is necessary
for the "sponsoring community" (in this case the City of Prior Lake) to provide a
resolution of support to Scott County who is actually issuing the bonds. The
resolution does nothing more than to fulfill a statutory requirement. It also places
on record that the City Council concurs that the project to be funded provides for
public benefit.
Conclusion: The City Council should determine whether is wishes to adopt a
resolution in support of the St. Michael's Catholic school improvement project.
Adoption of the resolution does not oblige the City in any way. It simply confirms
that the City is aware of the project does have general public benefits and that
the Council supports the County's action to issue conduit bonds in support of the
project.
This project is of benefit to residents of the Prior Lake community. Mary Ippel, the
City's bond counsel, has stated that she is comfortable with adoption of the host
community resolution and that Prior Lake need not conduct a public hearing
before taking such actior)< Sl\""-~<-- ~. ~IN'V-~ t>."H \..< d~ \.'.(:-H\,.-, .... kJ.uu~\'c''-~ .
16200 Eagle Creek Ave. S.E., Prior Lake, Minnesota 55372-1714 / Ph. (952) 447-4230 / Fax (952) 447-4245
1:\COUNCIL\AGNRPTS\2001\ST MIKE BONDS~{>>.L OPPORTUNITY EMPLOYER
ALTERNATIVES: (1) Adopt the resolution of support as submitted.
RECOMMENDED
MOTION:
(2) Adopt the resolution with amendments.
(3) Take no action.
Alternative (1). The City Council should adopt the attached resolution supporting
the issuance of conduit bonds by Scott County, working in conjunction with the
Catholic Finance Corporation in an effort to support the St. Michael's Catholic
school improvement project.
1:\COUNCIL\AGNRPTS\2001\ST MIKE BONDS.DOC
RESOLUTION 01-XX
~ ~ A RESOLUTION ENDORSING SCOTT COUNTY PLAN TO
IlVNESo SELL CONDUIT BONDS TO FINANCE THE ST. MICHAEL'S CATHOLIC
SCHOOL IMPROVEMENT PROJECT.
Motion By:
Second By:
WHEREAS, federal and state laws permit counties to issue pass-through conduit debt for not-for-profit
organizations and other entities in support of qualified ("non-sectarian") projects; and
WHEREAS, the objective of conduit financing is to afford organizations the ability to realize a reduction
in the interest rate for a project, and the community to gain through the achievement of an
identified public purpose; and
WHEREAS, the Scott County Board of Commissioners has adopted a policy establishing a program to
provide for the use of conduit financing issued through Scott County; and
WHEREAS, S1. Michael's Catholic School, 16280 Duluth Avenue Southeast, in the City of Prior Lake
has undertaken a project to improve and expand their educational facilities; and
WHEREAS, Catholic Finance Corporation in conjunction with S1. Michael's Catholic School proposed
that Scott County consider conduit financing as a method of assisting in the funding of the
non-sectarian portions of this project; and
WHEREAS, the completion of this project will provide a public benefit by improving the quality and
expanding the capability of educational services provided by S1. Michael's Catholic School;
and
WHEREAS, the statutorily defined cap on the issuance of "bank qualified" bonds combined with the
potential need for bonding of other projects within the City limited the ability of the City of
Prior Lake to financially support this project via the issuance of conduit bonds through the
City.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA
that:
1. The recitals set forth above are incorporated herein.
2. The Prior Lake City Council supports the issuance of tax-exempt conduit bonds in support of
projects that will accomplish a public purpose.
3. The Prior Lake City Council has reviewed the proposed project at 81. Michael's Catholic School and
found it to be compatible with the comprehensive plan and objectives for the area and in
compliance with the appropriate zoning and land use regulations.
16200 Eagle Creek Ave. S.E., Prior Lake, Minnesota 55372-1714 / Ph. (952) 447-4230 / Fax (952) 447-4245
AN EQUAL OPPORTUNITY EMPLOYER
4. The Prior Lake City Council fully supports the project being proposed by St. Michael's Catholic
School and would encourage the Scott County Board of Commissioners to give full consideration of
this project for inclusion in the County's conduit financing program.
PASSED AND ADOPTED THIS 15TH DAY OF OCTOBER, 2001.
YES
NO
Mader Mader
Ericson Ericson
Gundlach Gundlach
Petersen Petersen
Zieska Zieska
Frank Boyles, City Manager
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