HomeMy WebLinkAboutNov 27, 1981Official Proceedings
Columbia Heights City Council Special Meeting
November 27, 1981
The meeting was called to order by Mayor Nawrocki at 7:00 pm.
l. Roll Call: Logacz, Heintz, Norberg, Hentges, Nawrocki--present
2. Purpose of the Meeting
For adoption of ordinance authorizing the issuance of Industrial Development Revenue
Bonds for the "Corner Partnership"
3. Second Reading of Ordinance No.983 being an ordinance giving preliminary approval
to a project under the Municipal Industrial Development Act, referring the proposal to
the Commissioner of Securities and Real Estate for approval, and authorizing the
preparation of necessary documents.
The City Manager explained amendments to the Mayor's Statement and Application to the
Commissioner of Securities that were received by the Council at this meeting.
Motion by Heintz, second by Norberg to waive the reading of the ordinance there being
ample copies available to the public. Roll call: Ali ayes
The Corner Partnership proposes to develop an office building located on the northwest
corner of 40th Avenue and Central Avenue; with the estimated total amount of the pro-
posed bond issue being SI,i)00,000. Councilman Norberg inquired as to who the partners
were in this venture. Doug Peterson, of the the Peterson and Kal ina I. aw Offices ad-
vised him that the following firms were involved with the Corner Partnership; Halva
and Williams Law offices, Peterson and Kal ina Law offices, Keith Louiselle Insurance
Company and the Ashford Clinic. The Columbia Heights Credit Union will be a tenant in
the building. Doug Peterson stated that if there are any costs involved the partner-
ship will pay them. The Mayor asked Peterson to define 'costs'
Councilman Norberg questioned item # 6 in the Mayor's statement regarding Council
reviewal of the preliminary plans and drawings for the project.
-Ordinance No. 98)
BEING AN ORDINANCE GIVING PRELIMINARY
APPROVAL TO A PROJECT UNDER THE MUNICIPAL
INDUSTRIAL DEVELOPMENT ACT, REFERRING THE
PROPOSAL TO THE COMMISSIONER OF SECURITIES
AND REAL ESTATE FOR APPROVAL, AND
AUTHORIZING PREPARATION OF NECESSARY
DOCUMENTS
The City of Columbia Heights does ordain:
1. It is hereby found, determined and declared as follows:
1.1. The welfare of the State of Minnesota requires active promo-
tion, attraction, encouragement and development of economically sound
industry and commerce through governmental acts to prevent, so far as
possible, emergence of blighted lands and areas of chronic unemployment,
and it is the policy of the State of Minnesota to facilitate and encore;age
action by local government units to prevent the economic deterioration of
such areas to the point where the process can be reversed only by total
redevelopment through the use of local, state and federal funds derived
from taxation, with the attendant necessity of relocating displaced persons
and of duplicating public services in other areas.
Special Meeting
November 27, }981
page 2
1.2. Technological change has caused a shift to a significant degree
in the area of opportunity for educated youth to processing, transporting,
marketing, service and other industries, and unless existing and related
industries are retained and new industries are developed to use the available
resources of the City of Columbia Heights (the ~City"), a large part of the
existing investment of the community and of the state as a whole in
educational and public service facilities will be lost, and the movement of
talented, educated personnel of mature age to areas where their services
may be effectively used and compensated and the lessening attraction of
persons and businesses from other areas for purposes of industry, commerce
and tourism will deprive the City and the State of the economic and human
resources needed as a base for providing governmental services and facil-
ities for the remaining population.
1.3. The increase in the amount and cost of governmental services
requires the need for more intensive development and use of land to provide
an adequate tax base to finance these costs.
1.4. A representative of The Corner Partnership (hereinafter the
~Applieant"), has advised this City Council (the "Council") that it desires to
acquire land and construct a building of approximately 16,000 square feet
and acquire and install equipment therefor for use as an office facility
(hereinafter referred to as the ~Projeet").
1.5. The existence of the Project in the City will contribute to more
intensive development and use of land to increase the tax base of the City
and overlapping taxing authorities and maintain and provide for an increase
in opportunities for employment for residents of the City.
1.6. The City has been advised that conventional, commercial
financing to pay the capital cost of the Project is available at such costs of
borrowing that the economic feasibility of operating the Project would be
significantly reduced, but that with the aid of municipal financing, and its
resulting low borrowing cost, the Project is economically more feasible.
1.7. This Council has been advised by a representative of the
Applicant, that on the basis of information submitted to them and their
discussions with representatives of area financial institutions and potential
buyers of tax-exempt bonds, industrial development revenue bonds of the
City could be issued and sold upon favorable rates and terms to finance the
Project.
1.8. The City is authorized by Minnesota Statutes, Chapter 474, to
issue its revenue bonds to finance the cost, in whole or in part, of the
acquisition, construction, reconstruction, improvement or extension of cap-
ital projects consisting of properties used and useful in connection with a
revenue producing enterprise, such as that of the Applicant, and the
issuance of such bonds by the City would be a substantial inducement to the
Applicant to construct its facility in the City.
2. On the basis of information given the City to date, it appears that it
would be in the best interest of the City to issue its industrial development revenue
bonds under the provisions of Chapter 474 to finance the Project of the Applicant
at a cost presently estimated not to exceed $1,300,000.
Special Meeting
November 27, 1981
page 3
3. The Project above referred to is hereby given preliminary approval by
the City and the issuance of bonds for such purpose and in such amount approved,
subject to approval of the Project by the Commissioner of Securities and Real
Estate and to the mutual agreement of this body, the Applicant and the initial
purchasers of the bonds as to the details of the bond issue and provisions for their
payment. In all events, it is understood, however, that the bonds of the City shall
not constitute a charge, lien or encumbrance legal or equitable upon any property
of the City except the Project and each bond, when, as, and if issued, shall recite
in substance that the bond, including interest thereon, is payable solely from the
revenues received from the Project and property pledged to the payment thereof,
and shall not constitute a debt of the City.
4. In accordance with Minnesota Statutes, Section 474.01, Subdivision
7a, the Mayor of the City is hereby authorized and directed to submit the proposal
for the Project to the Commissioner of Securities and Real Estate for approval of
the Project. The MaYor, Clerk, Treasurer and other officers, employees and agents
of the City are hereby authorized to provide the Commissioner with any
preliminary information needed for this purpose, and the City Attorney is
authorized to initiate and assist in the preparation of such documents as may be
appropriate to the Project, if it is approved by the Commissioner.
5. The law firm of Holmes & Graven, Chartered, is authoriz'ed to a~-t as
Bond Counsel and to assist in the preparation and review of necessary documents
relating to the Project and bonds issued in connection therewith. The Mayor,
Clerk-Treasurer, City Attorney, and other officers, employees and agents of the
City are hereby authorized to assist Bond Counsel in the preparation of such
documents.
6. The City shall have the right, in its sole discretion, to withdraw from
participation, and accordingly, not issue its revenue bonds for the Project, should
the City at any time prior to the issuance thereof determine that it is in the best
interest of the City not to issue its revenue bonds or should the parties to the
transaction be unable to reach agreement as to the terms and conditions of any of
the documents required for the transaction. The decision of the City Council with
respect to any of the aforementioned matters shall be incontestable.
7. This ordinance shall be in full force and effect from and after thirty
(30) days after its passage.
· First Reading:
Second Reading:
Offered by:
Seconded by:
Roll Call:
Date of Passage:
NOVEMBER 9, 1981
November 27, 1981
Heintz
Logacz
All Ayes
November 27, 1981
Mayor
.Special Meeting
November 27, 1981
page 4
NOTICE OF PUBLIC HEARING ON A PROPOSED
PROJECT AND THE ISSUANCE OF INDUSTRIAL
DEVELOPMENT REVENUE BONDS UNDER THE
MUNICIPAL INDUSTRIAL DEVELOPMENT ACT,
MINNESOTA STATUTES, CHAPTER 474, AS AMENDED
THE CITY OF COLUMBIA HEIGHTS, MINNESOTA
NOTICE IS HEREBY GIVEN that the governing body of the City of Columbia
Heights, Minnesota (the "City"), will meet on November 27, 1981, at ?:00 p.m. at
City offices in Columbia Heights, Minnesota, for the purpos'-~ of conducting a public
hearing on a proposal that the City issue its revenue bonds under the Munieipnl
Industrial Development Act, Minnesota Statutes, Chapter 474, as amended, in order
to finance the cost of a project. The proposed project will consist of the
acquisition of land within the City, the construction thereon of a building and the
acquisition and installation of equipment in connection therewith for use as an
office facility to be owned by The Corner Partnership for use in its business. The
estimated total amount of the proposed bond issue is $1,300,000. The bonds shall
be limited obligations of the City and the bonds and interest thereon shall be
payable solely from the revenues pledged to the payment thereof, except that such
bonds may be secured by a mortgage and other encumbrance on the project. No
holder of any such bond shall ever have the right to compel any exercise of the
taxing power of the City of Columbia Heights to pay the bonds, or the interest
thereon, nor to enforce payment against any property of the City except the
project.
A draft copy of the proposed application to the Minnesota Commissioner of
Securities and Real Estate for approval of the project, together with all
attachments and exhibits thereto, is available for public inspection at the City
offices.
Ail persons interested may appear and be heard at the time and place set
forth above.
[ Date of Publication]
BY ORDER OF THE CITY COUNCIL
OF THE CITY OF COLUMBIA HEIGHTS
CERTIFICATION OF MINUTES RELATING TO THE
RESOLUTION ESTABLISHING THE DATE FOR A
PUBLIC HEARING ON A PROPOSAL TO UNDERTAKE
AND FINANCE A PROJECT UNDER MINNESOTA
STATUTES, CHAPTER 474
City: Columbia Heights
County: Anoka
State: Minnesota
Governing body: City Council
Meeting:
A meeting of the City Council of the City of Columbia Heights, held
on the 27 day of November ,1981, at 7.nn p.m., in the City
of Columbia Heights, Minnesota. ' '
'Special Meeting
November 27, 1981
page 5
Coune~ members present:
Logacz, Helntz, Hentges, Norberg, Nawrocki
Council members absent:
None
Documents: A copy of a resolution adopted by the City Council of the City of
Columbia Heights at said meeting.
Certification:
I, John E. Sehedler, Clerk-Treasurer of the City of Columbia Heights,
Minnesota, do hereby certify the following:
Attached hereto is a true and correct copy of a resolution on file and of
record in the offices of the City of Columbia Heights, which resolution was
adopted by the City Council of the City of Columbia Heights, Minnesota, at the
meeting referred to above. Said meeting was a regular meeting of the City
Council, was open to the public, and was held at the time and place at which
meetings of City Council are regularly held. Council Member He intz moved
the adoption of the attached resolution. The motion for adoption of the attached
resolution was seconded by Council Member Logacz . A vote being taken on
the motion, the following voted in favor of the resolution:
Logacz, Heintz, Hentges, Norberg, Nawrocki
and the following voted against the resolution:
None
Whereupon said resolution was declared duly passed and adopted. The attached
resolution is in full force and effect and no action has been taken by the City
Council of the City of Columbia Heights which would in any way alter or amend
the attached resolution.
Witness my hand officially as the Clerk-Treasurer of the City of Columbia
Heights, Minnesota, this day of ,1981.
RESOLUTION NO. 81-65
John E. Sehedler
Clerk-Treasurer
RESOLUTION ESTABLISHING THE DATE FOR A
PUBLIC HEARING ON A PROPOSAL TO UNDERTAKE
AND FINANCE A PROJECT UNDER MINNESOTA
STATUTES, CHAPTER 474
· Special Meeting
November 27, ]981
page 6
WHEREAS, the Minnesota Municipal Industrial Development Act, Minnesota
Statutes, Sections 474.01 et seq. (the "Act"), authorizes the issuance of revenue
bonds to finance projects; ~'~d
WHEREAS, the term "project" is defined by Section 474.02, subdivision la,
of the Act to include "any properties, real or personal, used or useful in connection
with a revenue producing enterprise"; and
WHEREAS, a representative of The Corner Partnership (the 'Developer~)
has presented this City Council with information concerning a proposed project
(the "Project") to be acquired and constructed within the City of Columbia Heights
(the ~City"); and
WHEREAS, the Developer has requested that the City resolve to issue
revenue bonds pursuant to the Act to finance the Project and has presented to the
City a form of preliminary ordinance concerning such issuance with a request that
such preliminary ordinance, attached hereto as Exhibit A, be considered for
adoption by the City Council of the City; and
WHEREAS, Section 474.01, subdivision 7b, of the Act provides that the City
Council must conduct a public hearing on any proposal to undertake and finance a
project; and
WHEREAS, Section 474.01, subdivision 7b, of the Act provides that notice of
the time and plaee of such public hearing and stating the general nature of the
project and an estimate of the principal amount of bonds or other obligations to be
issued to finance the project must be published at least once not less than fifteen
(15) days nor more than thirty (30) days prior to the date fixed for the public
hearing in the official newspaper of the City and a newspaper of general
circulation in the City; and
WHEREAS, Section 474.01, subdivision 7b, of the Aet provides that the
notice must state that a draft copy of the proposed application (the "Application-)
to the Commissioner of Securities and Real Estate of the Securities Division of the
Department of Commerce of the State of Minnesota for approval of the Project,
together with all attachments and exhibits, is on file with the City and available
for public inspection; and
WHEREAS, the Developer has presented to the City a form of public notice,
attached hereto as Exhibit B, with a request that the City Council establish a date
for a public hearing on the proposal to undertake and finanee the Project and to
authorize publication of the form of public notice provided by the Developer;
NOW, THEREFORE, BE IT RESOLVED THAT:
1. The City Council'of the City will conduct a public hearing on the
proposal to undertake and finance the Project on the 27th day of November, 1981.
2. The City Manager is hereby authorized to cause a public notice,
substantially in the form of the notice attached hereto as Exhibit B, to be published
in the official newspaper of the City and a newspaper of general circulation in the
City.
3. The City Manager is hereby authorized and directed to have available
for public inspection in the offices of the City a draft copy of the proposed
Application, together with all attachments and exhibits thereto.
Special Meeting
November 27, 1981
page 7
Passed this 9th day of November, 1981
Offered by:
Seconded by:
Roll call:
Heintz
Norberg
Logacz, Heintz, Hentges, Nawrocki--aye
Norberg--nay
Bruce G. Nawrocki, Mayor
Jo-Anne Student, Council Secretary
MAYOR'S STATEMENT CONC£RNINO A PROPOSED PROJECT
UNDER MINNESOTA STATUTES, CHAPTER 474
The undersigned, being the duly qualified and acting Mayor of the City of
Columbia Heights, Minnesota (the "City"), certifies that the City Council of the
City (the "Council') has been provided by representatives of The Corner
oPartnership (the "Developer"), with certain information concerning a proposed
Project under the Minnesota Municipal Industrial Development Act, Minnesota
Statutes, Chapter 474. On the basis of such information the Council, by ord/nanee
~dopted November 27,, 1981 (the "Preliminary Ordinance"), has given preliminary
approval to the proposed Project and the financing thereof by the issuance of a
revenue obligation or obLigations of the City. The following are factors considered
by the CouneLl in determining to give preliminary approval to said Project=
1. The Project consists generally of:
Acquisition of land, construction of a building and the
acquisition and installation of equipment therefor for use as an office
facility.
2. The bond counsel of the City is of the opinion that the Project
constitutes a "project" within the meaning of Minnesota Statutes, Section
474.02, Subdivision la.
3. ..,liased on an estimated total cost of acquisition and construc-
tion of approximately $1,300,000 it is the opinion of the CouneLl that the
Project, when completed, will add significantly to the commercial and
industrial tax base of the City and the County and School District in which
the Project is located,
4. Representatives of the Developer estimate that, as a result of
the acquisition, construction and instaktation of the Project, the Project will
generate employment opportunities for approximately twenty (20) persons
(in addition to those currently employed by the Developer), in the City and
the surrounding area. The Council is concerned about the level of
unemployment in the City and surrounding area and the resulting movement
of persons to other areas where jobs are more plentiful, and believes that
the existence of the Project in the City would help alleviate those problems.
Special Meeting
November 27, 1981
page 8
5. Representatives of the Developer estimate that the acquisi-
tion, construction and installation of the Project will result in an additional
payroll of approximately $314,000, based on currently prevailing wages. The
Council believes that a substantial percentage of that additional payroll will
be spent on housing, food and other goods and services in the City and
surrounding area, thus benefiting the local housing industry and local
merchants.
6. The Council has reviewed the preliminary plans and drawings
for the Project (which have also been reviewed by the City Engineer) and
believes that the Project, when completed, will be compatible with present
and projected development in its area.
7. Nothing has come 1o the attention of the Council to indicate
that the proposed financing of the Project by the City would adversely and
unfairly affect any other business enterprise located in the City.
8. Pursuant to the Preliminary Ordinance of November 27 , 1981,
the City will comply with the requirements of Minnesota Statutes, Section
474.01, Subd. 8.
9. The Project does not include any property to be sold or affixed
to or consumed in the production of property for sale, and does not include
any housing facility to be rented or used as a permanent residence.
10. A public hearing was called on November 27~ , 1981, at City
offices in Columbia Heights, Minnesota, at 7:00 p.m., central time,
pursuant to Minnesota Statutes, Section 474.01', Subd. 7b, to consider the
proposal that the City undertake and finance the Project. All interested
parties were afforded an opportunity to express their views.
Mayor
IMPORTANT
This Application must be submitted to Commissioner in duplicate.
STATE OF MINNESOTA
DEPARTMENT OF COMMERCE, SECURITIES AND REAL ESTATE DI~ISION
APPLICATION
~roval of Municipal Industrial Revenue Bond Pro'e~
Date: _ ,1981
To: Minnesota Department of Commerce Securities Division
Metro Square Building
St. Paul, Minnesota 55101
The governing body of the City of Columbia Heights, Minnesota, hereby
applies to the Commissioner of the Securities and Real Estate Division of the
Department of Commerce, of the State of Minnesota for approval of a proposed
Municipal Industrial Development Revenue Bond issue, as required by Section 1,
Subdivision 7, Chapter 474, Minnesota Statutes.
Spec'ia 1 Meeting
November 27, 1~)81
page ~)
l~e have entered into preliminary discussions with:
FIRM: The Corner Partnership
ADDRESS: $58-40th Avenue Northeast
CITY: Columbia Heights STATE: Minnesota 55421
State of Incorporation: general partnership
Attorney: Doug Paterson
m eat
Address: 556-40th Avenue Northeast, Columbia Heights, Minnesota 55421
This'firm is engaged primarily in (nature of business): real estate develop-
The funds received from the sale of the Industrial Revenue Bonds will be
used to (general nature of project): acquire land, construct a building thereon and
· acquire and install equipment in connection therewith for use as an office facility.
It will be located in: Columbia Heights, Minnesota
The total bond· issue will not exceed approximately $1,300,000 to be applied
toward payment of costs now estimated as follows:
Cost Item
Land Acquisition and Site Development
Construction Contracts
Architectural and Engineering Fees
Legal Fees and Administrative Costs
Interest During Construction
Contingencies
Commitment and Origination Fee
Amount
$ 102,000
890,000
61,000
61,000
71,000
68,000
47,000
It is presently estimated that construction will begin on or about March 1,
1982, and will be completed on or about December 1, 1982. When completed, there
will be approximately twenty (20) new jobs created by the project at an annual
payroll of approximately $314,000 based upon currently prevailing wages. The
tentative loan term is 30 years, commencing March 1, 19B2. The borrower will own
the project.
The following exhibits are furnished with this application and are incorpo-
rated herein by reference:
An opinion of bond counsel that the proposal constitutes a project
under .Minnesota Statutes, Chapter 474.02, subdivision la.
A copy of the city council ordinance giving preliminary approval for
the issuance of its revenue bonds.
A comprehensive statement by the municipality indicating how the
project satisfies the public purpose of Minnesota Statutes, Section
474.01-.02.
®
A letter of intent to purchase the bond issue or a letter confirming
the feasibility of the project from a financial standpoint.
Special Meeting
November 27, 1981
page l0
A statement, signed by the Mayor, to the effect that upon entering
into the revenue a~'eement, the information required by Minnesota
.Statutes, Section 474.01, subdivision 8, will be submitted to the
Department of Economic Development.
A statement signed by the Mayor, that the project does not include
any property to be sold or affixed to or consumed in the production of
property for sale, and does not include any housing facility to be
rented or used as a permanent residence.
A statement signed by the Mayor that a public hearing was conducted
pursuant to Minnesota Statutes, Section 474.01, subdivision ?b. The
statement shall include the date, time and place of the meeting and
that all interested parties were afforded an opportunity to express
their views.
3. A copy of the notice of publ/eation of the public hearing.
We, the undersigned, are duly elected representatives of the City of Columbia
Heights, Minnesota, and solicit your approval of this project at your earliest
convenience so that we may carry it to a final conclusion.
Signed by: (Principal Officers)
This approval shall not be deemed to be an approval by the Commissioner or the
State of the feasibility of the project or the terms of the lease to be executed or
the bonds to be issued therefor.
Date of approval:
4. Adiournment
Motion by Logacz,
All ayes
second by Heintz
Student, Coun'n~il Secretary
Commissioner of Securities and Real Estate
Minnesota Department of Commerce
to adjourn
the meeting at 7:15 pm. Roll call:
Bruce G. Nawrocki, Mayor