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HomeMy WebLinkAbout15-081 Intent to Assist Financing Senior Apartments Project ti U try 4646 Dakota Street SE �NNESO�P Prior Lake, MN 55372 RESOLUTION 15-081 A RESOLUTION RECITING A PROPOSAL FOR A MULTIFAMILY HOUSING DEVELOPMENT PROJECT,APPROVING A HOUSING PROGRAM AND INDICATING PRELIMINARY INTENT TO ASSIST IN THE FINANCING OF THE PROJECT PURSUANT TO MINNESOTA STATUTES, CHAPTER 462C (PRIOR LAKE SENIOR APARTMENTS PROJECT) Motion By: Keeney Second By: Thompson WHEREAS, The City of Prior Lake, Minnesota (the "City") is authorized pursuant to Minnesota Statutes, Chapter 462C, as amended (the"Act")to finance the making of loans with respect to multifamily housing developments within the boundaries of the City through the issuance of revenue bonds, notes or other obligations; 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 such obligations; and WHEREAS, The City has received a proposal from Prior Lake Leased Housing Associates I, LLLP, a Minnesota limited liability limited partnership (the "Borrower"), that the City assist in financing a Project hereinafter described, through the issuance of revenue bonds or a single note, in the principal amount not to exceed $21,000,000 (the"Note") pursuant to the Act and in accordance with a housing finance program prepared with respect to the Project ; and WHEREAS, The undertaking of the proposed Project and the issuance of the Note to finance the cost thereof will further promote the public purposes and legislative objectives of the Act by expanding and assisting in the availability of multifamily housing facilities in the City,especially housing facilities for seniors; and WHEREAS, The Project to be financed by the Note is the acquisition, construction and equipping of an approximately 170-unit independent multifamily senior housing development, to be located at 5119 Gateway Street SE in the City (the "Project"). The Project will be owned and operated by the Borrower; and WHEREAS, The City has been advised by representatives of the Borrower that conventional, commercial financing to pay the capital cost of the Project is available only on a limited basis and at such high costs of borrowing that the economic feasibility of operating the Project would be significantly reduced; and WHEREAS, The City has on this date held a public hearing with respect to the Project, at which hearing all persons wishing to comment were heard; and WHEREAS, 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 HEREBY RESOLVED BY THE CITY COUNCIL OF PRIOR LAKE, MINNESOTA as follows: 1. The recitals set forth above are incorporated herein. 2. The Council hereby approves the housing program and gives preliminary approval to the Project and the financing thereof, pursuant to the Act and to issue the Note in the principal amount not to exceed $21,000,000. The issuance of the Note by the City is subject to, among other things, final approval by this Council, the Borrower and the purchaser of the Note as to the ultimate details of the financing of the Project. 3. On the basis of information available to the City it appears, and the City hereby finds, that the Project constitutes a multifamily housing development within the meaning of Section 462C.05 of the Act; that the availability of financing under the Act and the willingness of the City to furnish such financing will be a substantial inducement to the Borrower to undertake the Project, and that the effect of the Project, if undertaken, will be to encourage the provision of senior multifamily rental housing opportunities to residents of the City at a reasonable cost. 4. The borrower has agreed and it is hereby determined that any and all costs incurred by the City, including all fees required by the City's administrative policies, in connection with the financing of the Project whether or not the Project is carried to completion and whether or not approved by the City will be paid by the Borrower. 5. Briggs and Morgan, Professional Association, acting as bond counsel, is authorized to assist in the preparation and review of necessary documents relating to the Project, to consult with the Borrower and the purchaser of the Note as to the maturities, interest rates and other terms and provisions of the Note and as to the covenants and other provisions of the necessary documents and submit such documents to the City for final approval. 6. Nothing in this resolution or in the documents prepared pursuant hereto shall authorize the expenditure of any municipal funds on the Project other than the revenues derived from the Project or otherwise granted to the City for this purpose. The Note shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property or funds of the City except the revenue and proceeds pledged to the payment thereof, nor shall the City be subject to any liability thereon. The holder of the Note shall never have the right to compel any exercise of the taxing power of the City to pay the outstanding principal on the Note or the interest thereon, or to enforce payment thereof against any property of the City. The Note shall recite in substance that the Note, including interest thereon, is payable solely from the revenue and proceeds pledged to the payment thereof. The Note shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation. 7. It is the purpose of this resolution to evidence the commitment of the parties and their intentions with respect to the Project in order that the Borrower may proceed without delay with the commencement of the acquisition, construction and equipping of the Project with the assurance that there has been sufficient"official intent"within the meaning of Treasury Regulations Section 1.150-2(d) to permit Project costs incurred within sixty (60) days prior to the date of adoption of this Resolution to be financed by the issuance of multifamily revenue bonds to finance the entire cost of the Project upon agreement being reached as to the ultimate details of the Project and its financing. PASSED AND ADOPTED THIS 11h DAY OF MAY, 2015. VOTE Hedberg Keeney McGuire Morton Thompson Aye ® ® ® ® ►-� Nay ❑ ❑ ❑ ❑ ❑ Abstain 0 0 ❑ 0 0 Absent 0 0 0914/❑ ❑ 1 ' 4 Frank Boyle7ity Manager