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HomeMy WebLinkAboutMay 4, 1981Official Proceedings Special Meeting Columbia Heights City Council May 4, 1981 The meeting was called to order by Mayor Nawrocki at 10:O1 pm. i. Roll Call: Logacz, Heintz, Norberg, Hentges, Nawrocki--present 2. Purpose of the Meeting: First reading of Ordinance No. 951, being an ordinance giving preliminary approval to a project under the Municipal Industrial Development Act, referring the Proposal to the Commissioner of Securities for approval, and authorizing preparation of necessary documents ( Columbia Heights Mall), and to establish a public hearing at which time there will be a second reading of Ordinance No.951 and consideration of its adoption. Motion by Heintz, second by Norberg that the reading of the Ordinance be waived there being ample copies available to the public. Roll call: All ayes Ordinance No. 951 BEING AN ORDINANCE GMNG PRELIMINARY APPROVAL TO A PROJECT UNDER THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, REFERRING THE PROPOSAL TO THE COMMISSIONER OF SECURITIES 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 encourage 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. 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. Special Meeting May 4, 198} page 2 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 Columbia Heights Mall (hereinafter the "Applicant"), has advised this City Council (the "Council") that it desires to acquire land within the Downtown C.B.D. Revitalization Project area and construct a building or buildings and acquire and install equipment therefor for use as a shopping center facility (hereinafter referred to as the "Project"). 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 it and its 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- itsd 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 $4,500,000. 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 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. Special Meeting May 4, 1981 page 3 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 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 authorized to act 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. This ordinance shall be in full force and effect from and after thirty (30) days after its passage. Mayor Secretary to the Council First Reading: Second Reading: Date of Passage: Roll Call: May 4, 1981 The Council was advised by the City Attorney that the call for the public hearing on regarding the second reading of the Ordinance is in the form of a resolution. Motion by Heintz, second by Hentges to waive the reading of the resolution there being ample copies available to the public. Roll call: All ayes A point of clarification was made by the City Manager regarding the starting time of the public hearing, as stated in the resolution, it should correctly read 7:30 pm. RESOLUTION NO. 8]-25_ RESOLUTION ESTABLISHING THE DATE FOR A PUBLIC HEARING ON A PROPOSAL TO UNDERTAKE AND FINANCE A PROJECT UNDER MINNESOTA STATUTES, CHAPTER 474 WHEREAS, the Minnesota Municipal Industrial Development Act, Minnesota Statutes, Sections 474.01 e._~t seq. (the "Act"), authorizes the issuance of revenue bonds to finance projects; and Special Meeting May 4, 1981 page 4 WHEREAS, the term "project" is defined by Section 474.02, subdivision l&, 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 Columbia Heights Mall (the "Develope.r") 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 V;HEREAS, 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 much 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 ?b, of the Act provides that notice of the time and place 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 ?b, of the Act provides that the notice must state that a draft copy of the proposed application (the "Application") to the Commissioner of Securities 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 inspec- tion; 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 mud finance 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 26th day of May, 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 May 4, 1981 page 5 Offered by: Heintz Seconded by: Hentges Roll Call: All ayes Bruce G. Nawrocki, Mayor Jo-Anne Student, Council Secretary It was noted by Councilman Norberg that in the Ordinance No.951, page 2, Subsection 4 the Commissioner of Securities is referred to by gender. He desires that the lang- uage in this paragraph be revised and the City Attorney was so directed. 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 May 26, 1981, at 7:3¢ p.m. at City offices in Columbia Heights, Minnesota, for the purpose of conducting a public hearing on a proposal that the City issue its revenue bonds under the Municipal Industrial Dev'elopment 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 and the construction thereon of a building or buildings and the acquisition and installation of equipment therefor for use as a shopping center to be owned by Columbia Heights MaLl for use in its business. The estimated total amount of the proposed bond issue is $4,500,000. 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 for approval of the project, together with all attachments and exhibits thereto, is available for public inspection at the City offices. Special Meeting May 4, 1981 page 6 AU 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 4 day of May , 1981, at 8:00 p.m., in the City of Columl~ia Heights, Minnesota. Council members present: Logacz, Heintz, Norberg, Hentges, 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. Schedler, 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 MemberHe~ntz moved the adoption of the attached resolution. The motion for adoption of the attached resolution was seconded by Council Member Hentges.A vote being taken on the motion, the following voted in favor of the resolution: Logacz, Heintz, Norberg, Hentges, Nawrocki and the following voted against the resolution: None Special Meeting May 4, 1981 ½age 7 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 offieially as the Clerk-Treasurer of the City of Columbia Heights, Minnesota, this. ii day of May , 1981. (0 Exhibit A attached to this Exhibit B attached to this posed project. Both of these exhibits appear John E. Seh~dler Clerk-Treasure resolution is Ordinance No.951. resolution is notice of public hearing on this pro- in these minutes. IMPORTA~ This Application must be submitted to Commissioner in triplicate. ******************************************************************* STATE OF MINNESOTA DEPARTMENT OF COMMERCE, SECURITIES DIVISION APPLICATION For Approval of Municipal Industrial Revenue Bond Project Date: 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 State of Minnesota, Department of Commerce, Securities Division, for approval of a proposed Municipal Industrial Development Revenue Bond issue, as required by Section 1, Subdivision 7, Chapter 474, Minnesota Statutes. We have entered into preliminary discussions with: FIRM: Columbia Heights Mall ADDRESS: 3550 Lexington North Suite 104 STATE: Minnesota 55112 Minnesota partnership CITY: St. Paul State of Ineorporation: Attorney: Steve Swartz Special Meeting May 4, 1 981 page 8 Address: Mas]on, Edelman, Borman, Brand & MeNulty, Suite 1800 Midwest Plaza West Building, Minneapolis, Minnesota This firm is engaged primarily In (nature of business): real estate develop- ment The funds received from the sale of the Industrial Revenue Bonds will be used to (general nature of project): acquire ]and and construct a building or buildings thereon and acquire and install equipment in connection therewith for use as a shopping center. It will be located in: Columbia Heights, Minnesota The total bond'issue will not exceed approximately $4,500,000 to be applied toward payment of costs now estimated as follows: Cost Item Land Acquisition and Site Development Construction Contracts Equipment Architectural and Engineering Fees Legal Fees and Administrative Costs Interest during Construction Reserve Discount Letter of Credit Fee Amount $ 50,000 3,166,000 247,500 112,000 42,500 495,000 247,500 90,000 49,500 It is presently estimated that construction will begin on or about August 1, 1981, and will be completed on or about August 1, 1982. When completed, there will be approximately one hundred and fifty (150) new jobs created by the project at an annual payroll of approximately $1,800,000 based upon currently prevailing wages. The tentative loan (lease) term is 3 years, commencing August 1, 1981. 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. A copy of the city council ordinance giving preliminary approval for the issuance of its revenue obligations. A comprehensive statement by the municipality indicating how the project satisfies the public purpose of Minnesota Statutes, Chapter 474.02. A letter of intent to purchase the bond issue or a letter confirming the feasibility of the project from a financial standpoint. A statement, signed by the Mayor, to the effect that upon entering into the revenue agreement, the information required by Minnesota Statutes, Section 474.01, Subd. 8 will be submitted to the Department of Economic Development. e 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. Special Meeting May 4, 1981 page 9 A statement signed by the Mayor that a public hearing was conducted pursuant to Minnesota Statutes, Section 474.01, Subd. 7b. 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. 8. A copy of the notice of publication 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: Commissioner of Securities Minnesota Department of.E~ommeree MAYOR'S STATEMENT CONCERNING 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 Columbia Heights Mall (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 ordinance adopted , 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 Council in determining to give preliminary approval to said Project: 1. The Project consists generally of: Acquisition of land and construction of a building or buildings and the acquisition and installation of equipment therefor for use as a shopping center. 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. Based on an estimated total cost of acquisition and construc- tion of approximately $4,500,000 it is the opinion of the Council 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. Special Meeting May 4, 1981 page l0 4. Representatives of the Developer estimate that, as a result of the acquisition, construction and installation of the Project, the Project will generate employment opportunities for approximately one hundred and fifty (150) 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. 5. Representatives of the Developer estimate that the acquisi- tion, construction and installation of the Project will result in an additional payroll of approximately $1,800,000, 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 to 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 ., 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 , 1981, at City offices in Columbia Heights, Minnesota, at 7:30 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 ~/~ress the~e7 / Mayor Adjournment Motion by Norberg, second Roll call: All ayes by Heintz to adjourn the meeting at 10:06 pm. 'A~nne S[udent,'~ouncil Secre tary Bruce G. Nawrocki, Mayor 3Y' ~W ?LIT