Res 1997-54 RESOLUTION NO. 54 — 1997
RESOLUTION RECITING A PROPOSAL FOR A HOUSING
FINANCE PROGRAM TO FINANCE AN ELDERLY HOUSING
DEVELOPMENT PROJECT, GIVING PRELIMINARY APPROVAL
TO THE PROJECT AND THE ISSUANCE OF REVENUE BONDS
PURSUANT TO MINNESOTA LAW, AND RATIFYING THE
PREPARATION OF A HOUSING FINANCE PROGRAM (NOAH'S
ARK OF FRIDLEY PROJECT)
(a) WHEREAS, Minnesota Statues, Chapter 462C (the "Act") confers
upon cities, the power to issue revenue bonds to finance a program for
the purposes of planning, administering, making or purchasing loans with
respect to one or more multifamily housing developments within the
boundaries of the city; and
(b) WHEREAS, the City of Fridley, Minnesota (the "City") has
received from Noah' s Ark Senior Housing, Inc. , (the "Developer") a
proposal that the City undertake a program to finance a Project
hereinafter described, through the issuance of revenue bonds or
obligations (in one ore more series) (the "Bonds") pursuant to the Act;
and
(c) WHEREAS, the City desires to facilitate the development of
rental housing within the community; encourage the development of
affordable housing opportunities for residents of the City; encourage
the development of housing facilities designed for occupancy by elderly
persons; and encourage the development of blighted or underutilized land
and structures within the boundaries of the City; and the Project will
assist the City in achieving these objectives; and
(d) WHEREAS, the Project to be financed by the Bonds consists of
the acquisition, construction and equipping of elderly rental housing
development of approximately 112 units located at 83rd Avenue and
University Service Drive in the City, and consists of the construction
and equipping of buildings thereon which will result in the provision of
additional rental housing opportunities to elderly persons within the
community; and
(e) WHEREAS, in accordance with Minnesota Statutes, Section
462C.04, Subdivision 2, the City has heretofore submitted to the
Metropolitan Council (the "Council") a program to finance the Project
and the City has received a letter dated June 24, 1997 from the Council
stating the Council staff has reviewed the proposal and finds no
apparent inconsistencies between the proposal and Council policies; and
(f) WHEREAS, a public hearing on the Project was held on the date
hereof, after notice was published and materials made available for
public inspection at the City Hall, all as required by the Act and
Section 147 (f) of the Internal Revenue Code of 1986, as amended, at
which public hearing all those appearing who desired to speak were heard
and written comments were accepted; and
(g) 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 RESOLVED by the City Council of the City of
Fridley, Minnesota, as follows:
1. The City hereby gives preliminary approval to the proposal of
the Developer that the City undertake the Project, described above, and
the program of financing therefore, pursuant to the Act, consisting of
the acquisition and construction of multifamily rental housing
facilities within the City pursuant to the Developer's specifications
and to a revenue agreement between the City and the Developer on such
terms and conditions with provisions for revision from time to time as
necessary, so as to produce income and revenues sufficient to pay, when
due, the principal and interest on the Bonds in the total principal
amount of not to exceed $9,500, 000 to be issued pursuant to the Act to
finance the acquisition and construction of the Project; and said
agreement may also provide for the entire interest of the Developer
therein to be mortgaged to the purchasers of the Bonds, or a trustee for
the holder(s) of the Bonds; and the City, acting by and through the
City, hereby undertakes preliminary to issue its bonds in accordance
with such terms and conditions.
2. At the option of the City, the financing may be structured so as
to take advantage of whatever means are available and are permitted by
law to enhance the security for, or marketability of, the Bonds;
provided that any such financing structure must be consented to by the
Developer.
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 subdivision 5 of Section
462C.02 of the Act; that the availability of the financing under the Act
and the willingness of the City to furnish such financing will be a
substantial inducement to the Developer to undertake the Project, and
that the effect of the Project, if undertaken, will be to encourage the
provision of additional multifamily rental housing opportunities to
residents of the City, and to promote more intensive development and use
of land within the City.
4. The Project and the program to finance the Project by the
issuance of revenue bonds, is hereby given preliminary approval by the
City subject to final approval by the City, the Developer and the
purchasers of the Bonds as to ultimate details of the financing of the
Project.
5. All prior actions taken by the City Staff in directing Briggs
and Morgan, Professional Association, acting as bond counsel to prepare
a housing program for financing the Project prepared in accordance with
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the provisions of Minnesota Statutes, Section 462C.03 is hereby
ratified, affirmed and approved.
6. The Developer has agreed and it is hereby determined that any
and all costs incurred by the City in connection with the financing of
the Project whether or not the Project is carried to completion will be
paid by the Developer.
7. 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 City
Attorney, Developer and the underwriter of the Bonds and as to the
maturities, interest rates and other terms and provisions of the Bonds
and as to the covenants and other provisions of the necessary documents
and submit such documents to the City for final approval.
8. Nothing in this Resolution or 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 Bonds 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 Bonds shall never have the right to compel any exercise of
the taxing power of the City to pay the outstanding principal on the
Bonds or the interest thereon, or to enforce payment thereon against any
property of the City, except such property as may be expressly pledged
for the security of the Bonds. The Bonds shall recite in substance that
Bonds, including the interest thereon, are payable solely from the
revenue and proceeds pledged to the payment thereof. The Bonds shall
not constitute a debt of the City within the meaning of any
constitutional or statutory or Charter limitation.
9. In anticipation of the approval by all necessary entities of the
housing program 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 Developer 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 Developer considers necessary, including the use of interim,
short-term financing, subject to reimbursement from the proceeds of the
Bonds if any when delivered but otherwise without liability on the part
of the City.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY,
MINNESOTA, THIS 14TH DAY OF JULY, 1997.
NIl CY 7. 407.E .N - MAYOR
ATTEST:
1A)Slavry■ at/
WILLIAM A. CHAMPA - CITY CLERK
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