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HomeMy WebLinkAboutResolution 2001-54· RESOLUTION NO. 2001-54 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF COLUMBIA HEIGHTS, MINNESOTA, RATIFYING AND APPROVING A HOUSING PROGRAM, AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF ITS MULTIFAMILY HOUSING REVENUE BONDS (GNMA COLLATERALIZED MORTGAGE LOAN--CREST VIEW ONDC I PROJECT), SERIES 200lA-1 AND TAXABLE SERIES 2001A-2, PAYABLE SOLELY FROM REVENUES PLEDGED PURSUANT TO THE INDENTURE; AND AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF ITS MULTIFAMILY HOUSING REVENUE NOTE (CREST VIEW ONDCI PROJECT), SUBORDINATE SERIES 200lB, PAYABLE SOLEY FROM REVENUES PLEDGED PURSUANT TO A NOTE. AGREEMENT; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE BONDS AND THE NOTE AND RELATED DOCUMENTS; AND PROVIDING FOR THE SECURITY, RIGHTS, AND REMEDIES WITH RESPECT TO THE BONDS AND THE NOTE WHEREAS, the City of Columbia Heights, Minnesota (the "City"), is a home rule city and political subdivision duly organized and existing under its Charter and the Constitution and laws of the State of Minnesota; and WHEREAS, pursuant to the Constitution and laws of the State of Minnesota, particularly Minnesota Statutes, Chapter 462C, as amended (the "Act"), the City is authorized to carry out the public purposes described therein and contemplated thereby by issuing its revenue bonds or other obligations to make a loan to finance a multifamily housing development, including the financing of the costs of the acquisition and preparation of a site and the construction of a new multifamily housing development for rental primarily to elderly persons; and WHEREAS, a multifamily housing development may consist of a multifamily housing development and a new health care facility if: (i) the multifamily housing development is designed and intended to be used for rental occupancy; (ii) the multifamily housing development is designed and intended to be used primarily by elderly or physically handicapped persons; and (iii) nursing, medical, personal care, and other health related assisted living services are available on a 24-hour basis in the development to the residents; and WHEREAS, in the issuance of its revenue bonds or obligations and in the making of a loan to finance a multifamily housing development the City may exercise, within its corporate limits, any of the powers that the Minnesota Housing Finance Agency may exercise under Minnesota Statutes, Chapter 462A, as amended, without limitation under the provisions of Minnesota Statutes, Chapter 475, as amended; and WHEREAS, Crest View ONDC I, a Minnesota nonprofit corporation (the "Borrower"), has requested that the City issue its multifamily housing revenue bonds under the Act and lend the proceeds thereof to the Borrower to finance a multifamily housing development to be known as Crest View on 42nd and described as follows: (i) a 50-unit assisted living facility for occupancy by elderly persons comprised of forty-one (41) units of conventional assisted living units and nine (9) special care units; (ii) to be housed in a single three-story building of approximately 40,000 square feet; and (iii) to be located at 916-42nd Avenue N. E. in the City (the "Project"); and WHEREAS, the City has prepared a housing program (the "Housing Program" or "Program"), a copy of which is on file with the City, to authorize the issuance by the City of up to $6,250,000 in revenue bonds to finance the acquisition, construction, and equipping by the Borrower of the Project; and WHEREAS, the Housing Program was prepared and submitted to the Metropolitan Council for its review on February 1, 2001; and WHEREAS, following the publication of a notice (the "Public Notice") of a public heating (in which a general, functional description of the Project was provided, as well as the maximum aggregate face amount of the obligations to be issued with respect to the Project, the identity of the initial owner, operator, or manager of the Project, and the location of the Project by street address) in a newspaper circulating generally in the City at least fifteen (15) days before the regularly-scheduled meeting of the City Council of the City on February 26, 2001, the City Council conducted a public hearing at which a reasonable opportunity was provided for interested individuals to express their views, both orally and in writing, on the Housing Program and the proposed issuance of the Bonds (as defined below), and the location and nature of the Project; and WHEREAS, the proceeds derived from the sale by the City of its Multifamily Housing Revenue Bonds (GNMA Collateralized Mortgage Loan--Crest View ONDC I Project), Series 200lA-1 (the "Series A-1 Bonds"), and Multifamily Housing Revenue Bonds (GNMA Collateralized Mortgage Loan--Crest View ONDC I Project), Taxable Series 2001A-2 (the "Series 2001A-2 Bonds", and collectively with the Series 200lA-1 Bonds, the "Bonds") to be issued to finance the Project will be loaned to the Borrower pursuant to the terms of a Financing Agreement, dated as of October 1, 2001 (the "Financing Agreement"), between the City, the Borrower, Reilly Mortgage Group, Inc. (the "Lender"), and U.S. Bank Trust National Association, as trustee (the "Trustee"), whereby the City will apply the proceeds derived from the sale of the Bonds to fund a loan (the "Mortgage Loan") by the Lender to the Borrower, to be evidenced by a promissory note (the "Mortgage Note") of the Borrower, secured by a mortgage lien (the "Mortgage") on the Project and to be insured by the Federal Housing Administration ("FHA"), and upon endorsement of the Mortgage Loan by the FHA, the Lender is to issue and deliver to the Trustee, as security for the Bonds, a security (the "GNMA Security") issued by the Lender and guaranteed as to timely payment of principal and interest by the Government National Mortgage Association ("GNMA"); and WHEREAS, the Bonds will be issued under a Trust Indenture, dated as of October 1, 2001 (the "Indenture"), between the City and the Trustee, and the Bonds and the interest on the Bonds: (i) shall be payable solely fi'om the revenues pledged therefor; (ii) shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation; (iii) shall not constitute nor give rise to a pecuniary liability of the City or a charge against its general credit or taxing powers; and (iv) shall not constitute a charge, lien, or encumbrance, legal or equitable, upon any property of the City other than the City's interest in the Project and the Financing Agreement; and WHEREAS, the proceeds derived from the sale by the City of its Multifamily Housing Revenue Note (Crest View ONDC I Project), Subordinate Series 200lB (the "Note"), to be issued to finance the Project will be loaned to the Borrower pursuant to the terms of a Note Agreement, dated as of October 1, 2001 (the "Note Agreement"), between the City and the Borrower, and applied by the Borrower to the payment of certain costs of the Project; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF COLUMBIA HEIGHTS, MINNESOTA, AS FOLLOWS: 1. The City acknowledges, finds, determines, and declares that the issuance of the Bonds and the Note is authorized by the Act and is consistent with the purposes of the Act and that the issuance of the Bonds and the Note and the other actions of the City under the Indenture, the Financing Agreement, the Note Agreement, and this resolution constitute a public purpose and are in the best interests of the City. 2. The City understands that the Borrower will pay directly or through the City any and all costs incurred by the City in connection with the Program, whether or not the Project is completed, and whether or not the Bonds are issued. 3. For the purposes set forth above, there is hereby authorized the issuance, sale, and delivery of the Bonds in one or more series in the maximum aggregate principal amount not to exceed $5,300,000. The Bonds shall bear interest at the rates, shall be designated, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, shall be in such form, and shall have such other terms, details, and provisions as are prescribed in the Indenture, in the form now on file with the City, with the amendments referenced herein. The City hereby authorizes the Bonds to be issued, in whole or in part, as "tax-exempt bonds" the interest on which is not includable in gross income for federal and State of Minnesota income tax purposes. All of the provisions of the Bonds, when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Bonds shall be substantially in the forms in the Indenture on file with the City, which forms are hereby approved, with such necessary and appropriate variations, omissions and insertions (including changes to the aggregate principal amount of the Bonds, the stated maturities of the Bonds, the interest rates on the Bonds, the terms of redemption of the Bonds, and variation from City policies regarding methods of offering conduit bonds) as the Mayor and the City Manager (the "Mayor" and "City Manager"), in their discretion, shall determine. The execution of the Bonds with the manual or facsimile signatures of the Mayor and the City Manager and the delivery of the Bonds by the City shall be conclusive evidence of such determination. 4. The Bonds shall be special limited obligations of the City payable solely from the revenues provided by the Borrower pursuant to the Financing Agreement, and other funds pledged pursuant to the Indenture. The City Council of the City hereby authorizes and directs the Mayor and the City Manager to execute and deliver the Indenture, and to deliver to said Trustee the Indenture, and hereby authorizes and directs the execution of the Bonds in accordance with the terms of the Indenture, and hereby provides that the Indenture shall provide the terms and conditions, covenants, rights, obligations, duties and agreements of the owners of the Bonds, the City and the Trustee as set forth therein. All of the provisions of the Indenture, when executed as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Indenture shall be substantially in the form on file with the City, which is hereby approved, with such necessary and appropriate variations, omissions and insertions as do not materially change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution thereof by the Mayor and the City Manager shall be conclusive evidence of such determination. 5. The Mayor and City Manager are hereby authorized and directed to execute and deliver the Indenture, the Financing Agreement, and the Bond Purchase Agreement, between the City, U.S. Bancorp Piper Jaffray Inc. (the "Underwriter"), and the Borrower (the "Bond Purchase Agreement'). All of the provisions of the Indenture, Financing Agreement, and Bond Purchase Agreement, when executed and delivered as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Indenture, Financing Agreement, and Bond Purchase Agreement shall be substantially in the forms on file with the City which are hereby approved, with such omissions and insertions as do not materially change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution thereof by the Mayor and the City Manager shall be conclusive evidence of such determination. 6. The Bonds shall be revenue obligations of the City the proceeds of which shall be disbursed pursuant to the terms of the Indenture and the Financing Agreement, and the principal, premium, and interest on the Bonds shall be payable solely from the proceeds of the Bonds, the revenues derived from the Financing Agreement, and the other sources set forth in the Indenture. Bonds. The Trustee is hereby appointed as Paying Agent and Bond Registrar for the 8. The Mayor and City Manager of the City are hereby authorized to execute and deliver, on behalf of the City, such other documents as are necessary or appropriate in connection with the issuance, sale, and delivery of the Bonds and the Note, including the City Tax Certificate, the Tax Exemption Agreement, the Information Return for Tax-Exempt Private Activity Bond Issues, Form 8038, and all other documents and certificates as shall be necessary and appropriate in connection with the issuance, sale, and delivery of the Bonds and the Note. The City hereby approves the execution and delivery by the Trustee of the Indenture and all other instruments, certificates, and documents prepared in conjunction with the issuance of the Bonds and the Note that require execution by the Trustee. The City hereby authorizes Kennedy & Graven, Chartered, as bond counsel of the City, to prepare, execute, and deliver its approving legal opinions with respect to the Bonds and the Note. 9. The City has not participated in the preparation of the Official Statement relating to the offer and sale of the Bonds (the "Official Statement"), and has made no independent investigation with respect to the information contained therein, including the appendices thereto, and the City assumes no responsibility for the sufficiency, accuracy, or completeness of such information. Subject to the foregoing, the City hereby consents to the distribution and the use by the Underwriter in connection with the sale of the Bonds of the Official Statement, in the form on file with the City, and deems such Official Statement to be a "near final official statement" as of its date, as defined in Securities and Exchange Commission Rule 15c2-12. The Official Statement is the sole material consented to by the City for use in connection with the offer and sale of the Bonds. The City hereby approves the Continuing Disclosure Agreement, dated as of October 1, 2001 (the "Continuing Disclosure Agreement"), between the Borrower and the Trustee, in the form now on file with the City, and hereby authorizes the Trustee to execute and deliver the Continuing Disclosure Agreement. 10. Except as otherwise provided in this resolution, all fights, powers and privileges conferred and duties and liabilities imposed upon the City or the City Council by the provisions of this resolution or of the aforementioned documents shall be exercised or performed by the City or by such members of the City Council, or such officers, board, body or agency thereof as may be required or authorized by law to exercise such powers and to perform such duties. No covenant, stipulation, obligation or agreement herein contained or contained in the aforementioned documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the City Council of the City, or any officer, agent or employee of the City in that person's individual capacity, and neither the City Council of the City nor any officer or employee executing the Bonds or the Note shall be liable personally on the Bonds or the Note or be subject to any personal liability or accountability by reason of the issuance thereof. No provision, covenant or agreement contained in the aforementioned documents, the Bonds, the Note, or in any other document relating to the Bonds or the Note, and no obligation therein or herein imposed upon the City or the breach thereof, shall constitute or give rise to any pecuniary liability of the City or any charge upon its general credit or taxing powers. In making the agreements, provisions, covenants, and representations set forth in such documents, the City has not obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Financing Agreement which are to be applied to the payment of the Bonds, as provided therein and in the Indenture, and other than funds and revenues derived from the Note Agreement which are to be applied to the payment of the Note, as provided therein. 11. Except as herein otherwise expressly provided, nothing in this resolution or in the aforementioned documents expressed or implied, is intended or shall be construed to confer upon any person or firm or corporation, other than the City, any holder of the Bonds, or any holder of the Note issued under the provisions of this resolution, any right, remedy or claim, legal or equitable, under and by reason of this resolution or any provisions hereof, this resolution, the aforementioned documents, and all of their provisions being intended to be and being for the sole and exclusive benefit of the City, and any holder from time to time of the Bonds or the Note issued under the provisions of this resolution. 12. In case any one or more of the provisions of this resolution, other than the provisions contained in the first sentence of Section 4 hereof, or of the aforementioned documents, or of the Bonds or the Note issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this resolution, or of the aforementioned documents, or of the Bonds, or of the Note, but this resolution, the aforementioned documents, and the Bonds and the Note shall be construed and endorsed as if such illegal or invalid provisions had not been contained therein. 13. The Bonds, when executed and delivered, shall contain a recital that they are issued pursuant to the Act, and such recital shall be conclusive evidence of the validity of the Bonds and the regularity of the issuance thereof, and that all acts, conditions, and things required by the laws of the State of Minnesota relating to the adoption of this resolution, to the issuance of the Bonds, and to the execution of the aforementioned documents to happen, exist, and be performed precedent to the execution of the aforementioned documents have happened, exist, and have been performed as so required by law. 14. For the purpose of providing additional financing for the Project, the Note, to be dated as of October 1, 2001, is hereby authorized to be issued by the City in the original aggregate principal amount of not to exceed $400,000. The City hereby authorizes the Note to be issued, in whole or in part, as a "tax-exempt bond" the interest on which is not includable in gross income for federal and State of Minnesota income tax purposes. The Note shall be issued in one or more series, shall bear interest at such rate, shall be in such denomination, shall be numbered, shall be dated, shall mature, shall be subject to redemption prior to maturity, shall be in such form, and shall have such other details and provisions as are prescribed in the Note substantially in the form on file with the City on the date hereof, which is hereby approved, with such necessary variations, omissions, and insertions (including changes to the aggregate principal amount of the Note, the stated maturity of the Note, the interest rates on the Note, the terms of redemption of the Note, and variation fi.om City policies regarding methods of offering conduit bonds) as the Mayor and the City Manager, in their discretion, shall determine. The execution of the Note with the manual or facsimile signatures of the Mayor and the City Manager and the delivery of the Note by the City shall be conclusive evidence of such determination. 15. The proceeds derived from the sale of the Note are to be loaned to the Borrower pursuant to the terms of the Note Agreement. The Borrower is required to make loan repayments (the "Loan Repayments") under the Note Agreement on such dates and in such amounts to provide revenues sufficient to pay the principal of and interest on the Note when due. The Loan Repayments are to be assigned to the holders of the Note pursuant to the terms of an Assignment of Note Agreement, to be dated as of October 1, 2001 (the "Assignment"). The Mayor and City Manager are hereby authorized and directed to execute and deliver the Note, the Note Agreement, and the Assignment. All of the provisions of the Note, the Note Agreement, and the Assignment, when executed and delivered as authorized herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Note, the Note Agreement, and the Assignment shall be substantially in the forms on file with the City which are hereby approved, with such omissions and insertions as do not materially change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution thereof by the Mayor and the City Manager shall be conclusive evidence of such determination. 16. The Note shall be a revenue obligation of the City the proceeds of which shall be disbursed pursuant to the terms of the Note Agreement, and the principal, premium, and interest on the Note shall be payable solely fi.om the proceeds of the Note and the revenues derived from the Note. Payment of the Note is expressly subordinated to the payment of the Bonds and the Note is not secured by any interest in the Project. The Note, when executed and delivered, shall contain a recital that it is issued pursuant to the Act, and such recital shall be conclusive evidence of the validity of the Note and the regularity of the issuance thereof, and that all acts, conditions, and things required by the laws of the State of Minnesota relating to the adoption of this resolution, to the issuance of the Note, and to the execution of the aforementioned documents to happen, exist, and be performed precedent to the execution of the aforementioned documents have happened, exist, and have been performed as so required by law. 17. The officers of the City, bond counsel, other attorneys, engineers, and other agents or employees of the City are hereby authorized to do all acts and things required of them by or in connection with this resolution, the aforementioned documents, and the Bonds and the Note for the full, punctual, and complete performance of all the terms, covenants, and agreements contained in the Bonds and the Note, the aforementioned documents, and this resolution. In the event that for any reason the Mayor of the City is unable to carry out the execution of any of the documents or other acts provided herein, any other member of the City Council of the City shall be authorized to act in his capacity and undertake such execution or acts on behalf of the City with full force and effect, which execution or acts shall be valid and binding on the City. If for any reason the City Manager of the City is unable to execute and deliver the documents referred to in this Resolution, such documents may be executed by any member of the City Council or any officer of the City delegated the duties of the City Manager, with the same force and effect as if such documents were executed and delivered by the City Manager of the City. 18. This resolution shall be in full force and effect from and after its passage. Passed this 24th day of September 2001 Motion by: Second by: Roll Call: Szurek Williams Ayes: Williams, Szurek, Wyckoff, Nawrocki, and Peterson. Nayes - 0. ( Patricia Muscovitz, Deputy City (~lerk 7