HomeMy WebLinkAboutJul 7, 1980SPECIAL MEETING OFFICIAL PROCEEDINGS
PUBLIC HEARING, COLUMBIA HEIGHTS CITY COUNCIL
JULY 7,
The meeting was called to order by Mayor Nawrocki at 8:10.
1. Roll Call: Logacz, Heintz, Norberg, Nawrocki--present
Mentges--absent
2. Second reading of Ordinance # 915, Ordinance # 916, Ordinance # 917
Mayor Nawrocki welcomed all of the residents and others in the audience.
He reviewed, briefly, the history of this project and made the distinction
between a project that involves redevelopment and one that starts where there
has been no development previously. He established that the obvious difference
in a redevelopment project is the costs involved in the land preparation,
such as relocation of sc~ne of the residents and land acquisition. Nawrocki
personally felt one of the biggest advantages this project is offering the
community is job opportunities. Another plus for the project is the closeness
and availability of goods and services.
The Mayor recapped the committees and commissions who supplied considerable
input for this project, the Downtown Development and the HFLA. The committees
had as their makeup; citizens, businessmen,and elected officials. They reflected
a cross-section of the community and proved an invaluable service to the City
with their advice. Nawrocki also referred to the superior caliber of the
professional counsel that has served in an advisory capacity, James Holmes,
legal counsel, and financial consultants from the League of Minnesota
Minicipalities who did a detailed review of the plan, both for its financial
aspects and its viability.
Councilman Hentges arrived at the meeting at 8:20.
Roger Jensen, EXecutive Director of the HRA, reviewed the history of the
Downtown Development Plan from 1977 when it was adopted by the Council
to the present. He displayed maps with the developer's drawings, reviewed
what the City must do for the land preparedness, and detailed the financing
for the plan using tax increment funding.
Mr. Jensen answered some questions from the audience as to the possible
starting date of the construction of the project and leasing arrangements
by the tenants of the commercial section. Len Donohue of Watson Centers,Inc.,
spoke to the lease for the grocery store. He said their lease would be for
twenty to twenty-five years. A1Hami)l, of P.J.Gaughan, the other developer,
said they intend to continue as owners of the apartment building, and, perhaps,
will be looking at converting the .apartments into condominiums in the future.
Questions as to dollar amounts being paid for the land by the developers were
answered by Roger Jensen.
Councilman Norberg raised questions as to the project's energy efficiency concept.
He was advised that the project does comply with present state law with regard
to energy requirements. Also, Norberg wanted to know if there would be any need
for special services for the project. Roger Jensen said he had conferred with
the Fire Chief and the Police Chief and they found no particular problems
and anticipate no need for additional equipment.
Phil Chenoweth, fiscal consultant, restated his confidence that the bonds
could be sold at 7~ given the complexion of today's market. He said that
Columbia Heights has a low per-capita debt and is a well-developed community.
Norberg asked what wl)) be the total investment made by the City and was given
the figure of 650 thousand dollars.
A resident questioned if there had been a study done by potential commercial
SPECIAL MEETING
JULY 7, 1980
page 2
tenants, specifically the grocery store, to determine If they can clearly
realize a profit in this area. Roger Jensen answered that there had been
numerous studies done both by potential retailers and independent groups.
The first study had been done by a rea! estate research group on 1975 followed
by four others since then.All of the studies reflected this to be a sound
area in which to plan.
Mrs. Nary Joseph, 3634 2nd St. N.E. and Mrs. Ann Norton, two Minneapolis
residents, encouraged the City Council to pass the ordinances and move ahead
with the project. They reside near the City limits and felt the goods and
services offered by the project would be of benefit to the entire area
surrounding Columbia Heights. Bernard Szymczak, a resident of Columbia Heights,
has followed this project very closely and urged the Council to pass the
necessary ordinances.
Motion by Heintz, seconded by Hentges to dispense with the reading of Ordinance
# 915, as there are ample copies available to the public.
Roll Call: Logacz, Heintz, Hentges, Nawrocki--aye
Norberg--nay
Motion fails.
ORDINANCE # 915
This ordinance was read jointly by Acting City Manager Stuart Anderson and City
Attorney Ron Ka]ina,
Ordinance No. 915
BEING AN ORDINANCE PROVIDING FOR PUBLIC SALE
OF $8,175,000 GENERAL OBLIGATION TAX INCREMENT
BONDS OF 1980
The City of Columbia Heights does ordain:
1. It is hereby found, determined and declared that this City should
issue $8,175,000 General Obligation Tax Increment Bonds of 1980 (the 'Bonds")
pursuant to Minnesota Statutes S 462.585, to defray the public redevelopment cost
of Downtown C.B.D. Revitalization Project, a "redevelopment project" pursuemt to
Minnesota Statutes $ 462.411 et seq.
2. Eh]ers and Associates, Inc., bond eonsuJtants to the City, has
presented to this Council a form of Official Notice of Bond Sale for the Bonds to
be sold and issued, and a form of abbreviated Notice of Bond Sale for publication,
which are attached hereto, and which are hereby approved. This Council shall
meet at the time and p]sce specified in the form of the Official Notice of Bond
Sale hereinafter contained for the purpose of operdng and considering sealed {:)ids
for, and awarding the sa_lc of said $8,175,000 General ObLigation Bonds of 1980.
3. Each and ail of the terms and provisions of the following form of
Official Notice of Bond Sale are hereby adopted as attached hereto as Exhibit A as
the terms and conditions of said bonds and of the sale thereof.
SPECIAL MEETING
JULY 7, 1980
page 3.
4. This ordinance shall be in full force and effect from and after thirty
(30) days after its passage.
Mayor
Fimt Reading: June 25, 1980
Second Reading: July 7, )980
Offered by: Logacz
Seconded by: Hentges
Ro~ Call: Logacz, Heintz, Hentges,
Norberg--abstain
Date of Passage: July 7, 1980
Nawrocki--aye
Jo-Anne Student, Council Secretary
EXHIBIT A
TERMS AND CONDITIONS FOR RECEIPT OF BIDS AND AWARD OF SALE
$8,175,000
GENERAL OBLIGATION TAX INCREMENT BONDS, SERIES 1980
CITY OF COLUMBIA HEIGHTS, MINNESOTA
The City Council of the City of Columbia Heights, Mirmesota, will meet at City
Hall in Columbia Heights, Minnesota, on the llth da.y of August, 1980, at 7:00 p.m.,
C.D.T., to receive, open and consider bids for and award the sale of $8,175,000
Genera] Obligation Tax Increment Bonds, Series 1980 (the "Bonds"). No bids will be
opened and no bonds will be sold in the event that the Ordinance Providing for
Public Sale of $8,175,000 Genera] Obligation Tax Increment Bonds of 1980, to be
adopted July 7, 1980 does not become effective on August 6, 1980.
PURPOSE
The Bonds will be issued for the purpose of providing funds for a redevelopment
project within the City, in accordance with the provisions of Minnesota Statutes,
Chapters 273,462 and 475.
DATE, TYPE, DENOMINATION, MATURITIES AND REDEMPTION
The Bonds will be dated September 1, 1980, will be issued as negotiable investment
securities, in bearer form, with attached interest coupons, will be in the denomi-
nation of $5.000 each unless de.qi~nnt~cl
SPECIAL MEETING
JULY 7, 1980
page 4.
Year Amount Year Amount
1983 $ 10,000 1991 $425,000
1984 $ 10,000 1992 475,000
1985 --- 1993 525,000
1986 140,000 1994 550,000
1987 190,000 1995 650,000
1988 250,000 1996-2001 700,000
1989 300,000 2002 100,000
1990 350,000
Bonds maturing in 1991 and later years will be subject to redemption and
prepayment at the option of the City in inverse order of serial numbers on March 1,
1990, and any interest payment date thereafter, at the following prices plus
accrued interest to the date of redemption:
Redemption Da~e
Redemption Price
March 1, 1990 -September 1, 1993
March 1, 1994 - September 1, 1998
March 1, 1999 and thereafter
par plus 2%
par plus 1.5%
par
PAYING AGENT
Principal and interest will be made payable at a suitable bank in the United States
recommended by the purchaser and approved by the City Council, and the City will
pay the customary charges for this service provided that such recommendation is
received within 48 hours after the sale, and the City Council will select the paying
agent if the recommendation is not approved.
INTEREST PAYMENT DATES, RATES
Interest will be payable semiannually on each March 1 and September 1, eom-
mencing March 1, 1981. All bonds of the same maturity must bear interest at a
s~ngle uniform rate from date of issue to maturity, not exceeding 12% per annum,
expressed as an integral multiple of 5/100 of 1% per annum, represented by a single
set of coupons. No rate of any maturity may be lower thanthe highest rate carried
by any of the preceding maturities.
DELIVERY
The City will furnish without cost to the purchaser and within 40 days after award
of sale, the printed and executed Bonds, the legal opinion referred to below, and
the usual no-litigation certificate. Delivery will be made without cost to the
purchaser at the place of the purchaser's choice. Payment of the Bonds must be
made in funds immediately available to the City on the date of delivery.
LEGAL OPINION
An opinion as to the validity of the Bonds and the tax exempt nature of the interest
thereon will be furnished by Holmes & Graven, Chartered, of Minneapolis,
Minnesota. The legal opinion will be printed on the Bonds at the request of the
purchaser. The legal opinion will state that the Bonds are valia ~nd binding general
~ SPECIAL MEETING
JULY 7, 1980
page 5.
TYPE OF BID AND AWARD
Sealed bids for not less than $8,060,000 and accrued interest on the principal sum
of $8,175,000 must be mailed or delivered to the undersigned and must be received
prior to the time of said meeting. Bidders must bid for all or none of the Bonds.
Each bid must be unconditional and m.ust be accompanied by a cashier~ check or
bank draft in the amount of $163,500, payable to the City Clerk-Treasurer, to be
retained by the City as liquidated damages if the bid is accepted and the bidder
fails to comply therewith. The bid authorizing the lowest net interest cost,
determined by the addition of any discount to and the deduction of any premium
from the total interest on all Bonds from their date to their stated maturity, will
be deemed the most favorable. The net effective rate on all Bonds may not exceed
12% per annum. In the event that two or more bids state the lowest net interest
cost, the sale of the Bonds will be awarded by lot. The City reserves the right to
reject any and ali bids, to waive informalities in any bid, and to adjourn the sale.
CUSIP NUMBERS
The City will assume no obligation for the assignment or printing of CUSIP
numbers on the Bonds or for the correctness of any numbers printed thereon, but
will permit such printing to be done at the expense of the purchaser, if the
purchaser waives any extension of the time of delivery caused thereby.
Information for bidders and bidding forms may be obtained from the undersigned or
from EhIers and Associates, Ine_, 507 Marquette Avenue, Minneapolis, Minnesota
55402, telephone 612-339-8291, Financial Specialists.
BY ORDER OF THE CITY COUNCIL
NOTICE OF BOND SALE
$8,175,000 GENERAL OBLIGATION TAX INCREMENT, SERIES 1980
CITY OF COLUMBIA HEIGHTS, MINNESOTA
NOTICE IS HEREBY GIVEN that the City Council of the City of Columbia
Heights, Minnesota, will meet in Columbia Heights, Minnesota, on the llth day of
August, 1980, at 7:00 p.m., C.D.T., to receive, open and consider sealed bids for
and award the sale of $8,175,000 General Obligation Tax Increment Bonds, Series
1980 (the "Bonds"). In the event that the Ordinance Providing for Public Sale of
$8,175,000 General Obligation Tax Increment Bonds of 1980 adopted Ju]y 7, 1980
does not become effective on August 6, 1980, no bids will be opened and no bonds
will be sold. The Bonds will be issued for the purpose of providing funds for a
redevelopment project within the City. The Bonds will be issued as bearer bonds,
in the denomination of $5,000 each, will be dated as of September 1, 1980, and will
mature serially on March 1 in the following years and amounts:
Year Amount Year Amount
1983 $ I0,000 1991 $425,000
1984 $ 10,000 1992 475,000
1985 --- 1993 525,000
1986 140,000 1994 550,000
1987 190,000 1995 650,000
1988 250,000 1996-2001 ?00,000
1989 300,000 2002 100,000
1990 350,000
SPECIAL MEETING
JULY 7, 1980
page 6.
Interest will be payable semiannually on each March 1 and September 1, eom-
mencing March 1, 1981. Bonds maturing in 1991 and later years shall be subject to
redemption and prepayment on March 1, 1990, and any interest payment date
thereafter at the following prices plus accrued interest:
Redemption Date
Redemption Price
March 1, 1990 - September 1, 1993
March 1, 1994 - September 1, 1998
March 1, 1999 and thereafter
par plus 2%
par plus 1.5%
par
An opinion as to the validity of the Bonds and the tax-exempt nature of the
interest thereon will be furnished by Holmes & Graven, Chartered, of Minneapolis,
Minnesota. Copies of a statement of Terms and Conditions for Receipt of Bids and
Award of Sale and additional information may be obtained from the undersigned or
from Ehlers and Associates, Inc., 507 Marquette Avenue, Minneapolis, Mirmesota
55402, telephone: 612-339-8291, Financial Specialists.
Dated: ~, 1980.
BY ORDER OF THE CITY COUNCIL
Motion by Hentges, seconded by Heintz to dispense with the reading of
Ordinance # 916 as there are ample copies available to the public.
Roll Call: All ayes
RESOLUTION # 916
Ordinance No. 916
BEING AN ORDINANCE GIVING PRELIMINARY APPROVAL TO A
PROJECT AND AUTHORIZING THE ISSUANCE OF HOUSING
DEVELOPMENT REVENUE BONDS THEREFOR UNDER MIN-
NESOTA STATUTES, CHAPTER 462C, AND AUTHORIZING THE
PREPARATION OF NECESSARY DOCUMENTS
The City of Columbia Heights does ordain:
Preamble
WHEREAS, the Minnesota Legislature has enacted Laws 1980, Chapter 306
as codified in Minnesota Statutes, Chapter 462C (the Act), under which the City is
authorized to establish a housing plan (Housing Plan) and program (Housing
Program) for financing Housing Developments by the issuance of revenue bonds;
and
WHEREAS, in enacting the Act, the Legislature determined that provision,
maintenance and preservation of an adequate housing stock in conjunction with the
removal of blight within redevelopment projects is necessary to preservation of the
quality of life in a major metropolitan city and is therefore a public purpose; and
WHEREAS, Gaughan Land, Inc. (the Developer), has indicated an interest
and desire to acquire land in the Downtown C.B.D. Revitalization Project Area in
the City, and to construct and equip thereon 64 residential living units available for
rental and facilities related thereto (the Project), and the Project, as proposed, is
to be planned and completed as part of the Housing Program in accordance with
SPECIAL HEETING
JULY 7, 1980
page 7.
WHEREAS, the City has been advised by representatives of the Developer
that conventional, commercial financing to pay the capital cost of the Project has
not been obtained, is available only on a limited basis and is not ayailable upon
terms and conditions which are affordable by the Developer so that the economic
feasibility of acquiring, constructing, equipping and operating the Project would be
significantly impaired; however, the Developer has also advised the City that the
use of municipal financing and the lower borrowing cost resulting therefrom will
materially increase the economic feasibility of the Project and will constitute a
substantial inducement to the Developer to undertake the Project; and
WHEREAS, the City has been advised by representatives of the Developer
that conventional, commercial financing is likely not to be available to the
potential purchasers of the residential living units available for rental on terms and
conditions affordable by them so that the economic feasibility of purchasing such
units would be significantly impaired, but that the use of municipal financing and
the lower borrowing cost resulting therefrom would make such units available on
terms and conditions affordable by them; and
WHEREAS, the Developer has proposed that the City issue and sell its
Housing Development Revenue Bonds (the Bonds) pursuant to the Act and other
applicable laws for the purpose of financing the Project, including certain
incidental expenses thereto, in the approximate principal amount of $4,000,000 and
loan the proceeds realized upon the sale of the Bonds to the Developer, pursuant to
a revenue agreement wherein the Developer will be obi/gated to acquire, construct
and equip the Project, to apply the proceeds of the Bonds solely to the payment of
costs thereof and to make payments under the revenue agreement at the time and
in the amounts sufficient to provide for the prompt payment of principal of and
interest on the Bonds and all costs and expenses of the City incidental to the
issuance and sale of the Bonds; the proposal further provides that the Project will
-be mortgaged and a security interest therein granted and the City's right and
interest in the revenue agreement assigned for the benefit and security of the
holders from time to time of the Bonds; and
WHEREAS, the Project is located within the Downtown C.B.D. Revitali-
zation Project Area and is consistent with and will forward the public purposes of
the City in creating the Downtown C.B.D. Revitalization Project Area; and
WHEREAS, the full faith and credit of the City will not be pledged or
responsible for the Project or the payment of the principal of and interest on the
Bonds; and
WHEREAS, the undertaking of the Project has been considered by the
Housing and Redevelopment Authority in and for the City of Columbia Heights (the
Authority) and the Authority has transmitted and recommended the proposal for
financing the Project for review and consideration by the Council; and
WHEREAS, the Council has been advised that the Bonds in the approximate
principal amount of $4,000,000 may be sold on terms and conditions satisfactory to
the City and the Developer.
The City of Columbia Heights does ordain as follows:
SPECIAL MEETING
JULY 7, 1980
page 8.
1. The undertaking of the Project and the issuance of the Bonds
pursuant to the Act and other applicable laws in the approximate amount of
$4,000,000 to finance the costs thereof, all as referred to above, is hereby
authorized and approved by the City, subject to the agreement of the City, the
Developer and the Underwriter on the detailed terms and conditions on which the
Project will be financed and the Bonds will be issued, sold and secured.
2. The City Attorney and all City personnel, in consultation with the
Developer and the Underwriter and Holmes & Graven, as bond counsel, are
authorized to prepare the Housing Plan, the Housing Program, the revenue
agreement and other doeument~ necessary and appropriate for the planning,
completion and financing of the Project and to submit them to the Council for
approval.
3. This ordinance shall be in full force and effect from and after thirty
(30) days after its passage.
Mayor
First Reading:
Second Reading:
Offered by:
Seconded by:
Roll Call:
Date of Passage:
June 25, 1980
July 7, 1980
Hentges
Heintz
Logacz, Heintz, Hentges, Nawrocki--aye
Norberg--abstain
July 7, 1980
Jo-Anne Student, Council Secretary
Motion by Logacz, seconded by Norberg to dispense with the reading of
Ordinance # 917 as there are ample cooies available to the public.
Roll Call: All ayes
ORDINANCE # 917
Ordinance No. 917
BEING AN ORDINANCE GIVING PRELIMINARY APPROVAL TO A
PROJECT AND AUTHORIZING THE ISSUANCE OF HOUSING
DEVELOPMENT REVENUE BONDS THEREFOR UNDER MIN-
NESOTA STATUTES, CHAPTER 462C, AND AUTHORIZING THE
PREPARATION OF NECESSARY DOCUMENTS
The City of Columbia Heights does ordain:
[SPECIAL MEETING
JULY 7, 1980
page 9.
Preamble
WHEREAS, the Minnesota Legislature has enacted Laws 1980, Chapter 306
as codified in Minnesota Statutes., Chapter 462C (the Act), under which the City is
authorized to establish a housing plan (Housing Plan) and program (Housing
Program) for financing Housing Developments by the issuance of revenue bonds;
and
WHEREAS, in enacting the Act, the Legislature determined that provision,
maintenance and preservation of an adequate housing stock in conjunction with the
removal of blight within redevelopment projects is necessary to preservation of the
quality of life in a major metropolitan city and is therefore a public purpose; and
WHEREAS, Gaughan Land, Inc. (the Developer), has indicated an interest
and desire to acquire land in the Downtown C.B.D. Revitalization Project Area in
the City, and to construct and equip thereon 132 living units under condominium
ownership and facilities related thereto (the Project), and the Project, as proposed,
is to be planned and completed as part of the Housing Program in accordance with
the Act; and
WHEREAS, the City has been advised by representatives of the Developer
that conventional, commercial financing to pay the capital cost of the Project has
not been obtained, is available only on a limited basis and is not available upon
terms and conditions which are affordable by the Developer so that the economic
feasibLlity of acquiring, constructing, equipping and operating the Project would be
significantly impaired; however, the Developer has also advised the City that the
use of municipal financing and the lower borrowing cost resulting therefrom will
materially increase the economic feasibility of the Project and will constitute a
substantial inducement to the Developer to undertake the Project; and
WHEREAS, the City has been advised by representatives of the Developer
that conventional, commercial financing is likely not to be available to the
potential purchasers of the condominium units on terms and conditions affordable
by them so that the economic feasibility of purchasing such units would be
si~nificantly impaired, but that the use of municipal financing and the lower
borrowing cost resulting therefrom would make such units available on terms and
conditions affordable by them; and
WHEREAS, the Developer has proposed that the City issue and sell its
Housing Development Revenue Bonds (the Bonds) pursuant to the Act and other
applicable laws for the purpose of financing the Project, including certain
incidental expenses thereto, in the approximate principal amoun( o-f $~',000~000 and-
loan the proceeds realized upon the sale of the Bonds to the Developer, pursuant to
a revenue agreement wherein the Developer will be obligated to aequire, to
construct and equip the Project, to issue Housing Development Revenue Bonds (the
Bonds) in the approximate amount of $9,000,000 to provide mortgage financing for
individual condominium purchasers, to apply the proceeds of the Bonds solely to the
payment of costs thereof and to make payments under the revenue agreement at
the time and in the amounts sufficient to provide for the prompt payment of
principal of and interest on the Bonds and all costs and expenses of the City
incidental to the issuance and sale of the Bonds; the proposal further provides that
the Project will be mortgaged and a security interest therein granted and the City's
right and interest in the revenue agreement assigned for the benefit and security of
the holders from time to time of the Bonds; and
WHEREAS, the Project is located within the Downtown C.B.D. Revitali-
zation Project Area and is consistent with and will forward the public purposes of
the City in creating the Downtown C.B.D. Revitalization Project Area; and
SPECIAL MEETING
JULY 7, 1980
page lO.
WHEREAS, the ful/ faith and credit of the City will not be pledged or
responsible for the Project or the payment of the principal of and interest on the
Bonds; and
WHEREAS, the undertaking of the Project has been considered by the
Housing and Redevelopment Authority in and for the City of Columbia Heights (the
Authority) and the Authority has transmitted and recommended the proposal for
financing the Project for review and consideration by the Council; and
WHEREAS, the Council has been advised that the Bonds may be sold on
terms and conditions satisfactory to the City and the Developer.
The City of Columbia Heights does ordain as follows:
1. The undertaking of the Project and the issuance of the Bonds
pursuant to the Act and other applicable laws in the approximate amount of
$9,000,000 to finance the costs thereof together with mortgage financing for
individual condominium purchasers in the approximate amount of $9,000,000, all as
referred to above, is hereby authorized and approved by the' City, subject to the
agreement of the City, the Developer and the Underwriter on the detailed terms
and cond}tions on which the Project will be financed and the Bonds will be issued,
sold and secured.
2. The City Attorney and all City personnel, in consultation with the
Developer and the Underwriter and Holmes & Graven, as bond counsel, are
authorized to prepare the Housing Plan, the Housing Program, the revenue
agreement and other documents necessary and appropriate for the planning,
completion and financing of the Project and to submit them to the Council for
approval.
3. This ordinance shall be in full force and effect from and after thirty
(30) days after its passage.
Mayor
First Reading:
Second Reading:
Offered by:
Seconded by:
Roll Ca]d:
Date of Passage:
June 25, 1980
July 7, 1980
Heintz
Hentges
Logacz, Heintz, Hentges, Nawrocki--aye
Norberg--abstain
July 7, 1980
Jo-Anne StuHent, Counc;] Secretary
SPECIAL MEETING
JULY 7, 1980
page 11,
Motion by Heintz, seconded by Logacz to authorize and direct the City
Manager to cause notice of the time. place and purpose of said meeting to be
published in the official newspaper of the City, the Daily Bond Buyer and
in Commercial West not less than ]O days in advance of the date of sale,
as provided by law, which said notice shall be substantially in the form
of Exhibit A attached to Ordinance # 915, which was approved by the
City Council on July 7, 1980.
Roll Call: All ayes
Motion by Heintz, seconded by Hentges to adjourn.
Roll Call: All ayes
Meeting adjourned at 9:35.
Bruce ~'. Nawrocki, Mayor
,gAAnr~e Student, Cou~i~-~i-1 Secretary