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HomeMy WebLinkAbout5G Multifamily Housing Revenue Note Report6971175v1 AMENDED MULTI-FAMILY RENTAL HOUSING PROGRAM OF THE CITY OF PRIOR LAKE, MINNESOTA PRIOR LAKE SENIOR APARTMENTS PROJECT Proposal; Authority. The City of Prior Lake, Minnesota (the “City”), at the request of the Borrower (defined below), proposes to issue revenue bonds to assist in financing the acquisition, construction and equipping of a senior rental housing project described herein (this “Program”) pursuant to applicable authority conferred upon the City by the laws of the State of Minnesota, including without limitation Minnesota Statutes, Chapter 462C, as the same may be amended from time to time (collectively, the “Act”). Purposes. In creating this Program, the City is acting in furtherance of its findings that the preservation of the quality of life in the City is in part dependent upon the maintenance and provision of adequate, decent, safe, sanitary, and affordable housing stock for seniors; that accomplishing the goals of this Program is a public purpose and will benefit the residents of the City; that the need exists within the City to provide in a timely fashion additional affordable rental housing to and for the benefit of seniors of low and moderate income and their fami lies residing and expected to reside within the City; that there exist or are expected to exist persons and families within the City who are and will be able to benefit from and are in need of the Program; that the Program is necessary in view of the limited resources that may be available to such persons relative to the expenses involved in accomplishing the type of objectives outlined in this Program in the absence of one or more of the forms of assistance described herein or otherwise available pursuant to the Act; and that the City hereby finds that such forms of assistance are often necessary for the benefit of such persons, families, and goals and that, furthermore, the successful implementation of the objectives of the kind described in this Program has been found to provide impetus for the development of other housing in the City, as well as the general development of the City, by other persons who are not the beneficiaries of such governmentally sponsored or assisted activities. Rental Housing Purposes. More particularly, the City finds that there exists a need for affordable senior rental housing for qualifying individuals and families, which need is not being filled by private enterprise alone due to a variety of factors, including that the cost of new construction of senior rental units may in many cases prove economically unfeasible, given the high costs of construction and prevailing area rental levels, and that therefore appropriate levels of public assistance may be helpful and necessary in bridging that gap. General Description of the Program. This Program consists of financing the acquisition, construction and equipping of a 168 unit senior multifamily rental housing development, comprised of 112 one bedroom one bath units, 21 two bedroom two bath units, and 35 three bedroom two bath units within one contiguous approximately 287,000 square foot four story building (the “Project”). The one bedroom units will rent for approximately $975 per month, the two bedroom units will rent for approximately $1,170 per month, and the three bedroom units will rent for approximately $1,350 per month. The initial owner and operator of the Project, pursuant to the financing, will be Prior Lake Leased Housing Associates I, LLLP, a Minnesota limited liability limited partnership (the “Borrower”). 6971175v1 2 Location. This Program is limited to the Project. The Project will be located at 5119 Gateway Street SE in the City. Revenue Bonds. The amount of revenue bonds required to finance this Program will not exceed a maximum principal amount of $28,000,000. The City preliminarily intends to finance the Program by issuing bonds. The proceeds will finance the acquisition, construction and equipping of the Project and pay costs of issuing the bonds, and may be used to establish a reserve. The revenue bonds are expected to be issued in 2015, subject to final City Council approval in its sole and absolute discretion. Monitoring. The City expects to enter into suitable agreements with the Borrower, the trustee for the bonds and/or others respecting the monitoring or implementation by participants to ensure that the Project will be consistent with this housing Program and its objectives, which for this purpose means providing affordable rental housing. Meeting Needs; Methods. The Program will meet the need for rental housing for seniors of low and moderate incomes by providing units at an affordable rent. The City believes that this Program will help meet the identified needs under this Program. The specific methods anticipated to be used include the issuance of revenue bonds under the Act to provide feasible financing for various aspects of the Program so undertaken. Authorization. The Program is undertaken pursuant to Minnesota Statutes, Section 462C.05, Subdivision 4, for rental primarily to elderly persons. Limits on Gross Income. In connection with the issuance of the Bonds, the Borrower will be required to agree to limit the gross income of occupants of the Project in accordance with the requirements of Minnesota Statutes, Chapters 462C and 474A, and with the requirements relating to tax-exempt bonds for qualified residential rental projects. Adopted and approved on October 26, 2015, by the City Council of the City of Prior Lake, Minnesota.