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Home My WebLink About20170612_EDA_Packet ECONOMIC DEVELOPMENT AUTHORITY AGENDA SPECIAL MEETING June 12, 2017 5:45 pm City Hall Conference Room 1 th 590 40 Avenue NE Columbia Heights, MN 55421 1.Call to Order 2.Roll Call 3.Pledge of Allegiance BUSINESS ITEMS 4.Call for Redemption of Public Facilities Lease Revenue Bonds Resolution 2017-15 Motion: Move to waive the reading of Resolution 2017-15, there being ample copies available to the public. Motion: Move to adopt Resolution 2017-15, a resolution consenting to the redemption series 2007B (Municipal Liquor Store Project). OTHER BUSINESS 5.Adjourn The next EDA meeting will be Wĵ▄Ŧ ƳƲĊ╙ẽ ƴƲƳƹ at City Hall. AGENDA SECTION BUSINESS ITEMS ITEM NO. 4 MEETING DATE JUNE 12, 2017 CITY OF COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY ITEM:Call for Redemption of Public Facilities Lease Revenue Bonds DEPARTMENT: Community Development BY/DATE: Keith M. Dahl, June 7, 2017 BY/DATE: BACKGROUND: The City intends to refinance the Public Facilities Lease Revenue Bonds for the Municipal Liquor Stores Municipal Liquor Stores Bondsto achieve a lower interest rate and save money on its debt service payments. The City will issue its own bonds under the authority of the City Charter (the , and will use the proceeds of the Refunding Bonds to pay off the outstanding principal and accrued interest on the Municipal Liquor Stores Bonds. The City Charter requires a 30-day reverse referendum period after publication of a City ordinance authorizing the issuance of bonds. If the City receives a valid petition within the 30-day period, it may not issue its bonds without an election. The City published its ordinance authorizing the Refunding Bonds on May 12, 2017, and thus the 30-day petition period expires on Sunday, June 11. The City plans to award the sale of the Refunding Bonds on Monday, June 12, and will receive proceeds on Tuesday, Jul Municipal Liquor Stores Bonds, the EDA is required to notify the bondholders at least 30 days before the date of redemption. Thus, the EDA must adopt a resolution authorizing notification of the bondholders and calling for the redemption of the Municipal Liquor Store Bonds on August 1, 2017. STAFF RECOMMENDATION: Staff recommends approval of Resolution 2017-15 as presented. RECOMMENDED MOTION(S): Motion: Move to waive the reading of Resolution 2017-15, there being ample copies available to the public. Motion: Move to adopt Resolution 2017-15, a resolution consenting to the redemption and repayment of the outstanding Public Facility Lease Revenue Bonds, series 2007B (Municipal Liquor Store Project). ATTACHMENTS: 1.Resolution 2017-15 (4 Pages) EDA Letter COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 2017-15 A RESOLUTION CONSENTING TO THE REDEMPTION AND PREPAYMENT TSTANDING PUBLIC FACILITY LEASE REVENUE BONDS, SERIES 2007B (MUNICIPAL LIQUOR STORES PROJECT) BE IT RESOLVED By the Board of Commissioners of the Columbia Heights Economic Development Authority (the Authority), as follows: Section 1. Recitals. 1.01. Pursuant to a Mortgage and Security Agreement and Trust Indenture, dated as of September 1, 2007 (the U.S. Bank National Association, as he Authority issued its Public Facility Lease Revenue Bonds, Series 2007B (Municipal Liquor Stores Project) (Authority BondsSeptember 19, 2007, in the original aggregate principal amount of $5,040,000. The proceeds of the Authority Bonds were used to provide Columbia Heights, Minnesota (the . The Authority acquired a leasehold interest in the real pursuant to a Ground Lease, dated as of September 1, 2007 y, as lessee. The Authority Bonds are secured by lease payments from the City to the Authority pursuant to a Lease-Purchase Agreement, dated as of September 1, 2007 between the Authority, as lessor, and the City, as lessee. 1.02. Section 8.1 of the Lease permits the City to purchase the Site and the Improvements at any time, in accordance with Article V of the Lease. Pursuant to Section 5.5 of the Lease, the City may purchase all or a portion of the Site and the Improvements by depositing funds to the Trustee for deposit in the Bond Fund established under the Indenture and applied to the payment of principal of and interest on the Authority Bonds. 1.03. Pursuant to a resolution to be considered by the City Council of the City on the date hereof has determined to exercise its option to prepay the Authority Bonds in order to acquire the Site and the Improvements. Section 8.2 of the Lease requires that the City give notice to the Authority of its intention to exercise its option to prepay the Lease Payments and acquire the Site and the Improvements at least forty-five (45) days in advance of the date of prepayment and purchase. The City Finance Director gave such notice at the Auth February 6, 2017. In order to prepay the Lease Payments and acquire the Site and the Improvements from the Authority, the City will issue its General Obligation Refunding Bonds, Series 2017 principal amount of approximately $3,375,000. Proceeds of the City Bonds will be used to redeem and prepay the outstanding Authority Bonds in an amount sufficient to prepay the Lease Payments. 1.04. The Authority Bonds are currently outstanding in the aggregate principal amount of $3,700,000 and are callable on February 1, 2017, at a price of par plus accrued interest. Pursuant to the City Resolution, the City will request that the Authority consent to and call the Authority Bonds for redemption on August 1, 2017 in accordance with Section 8.2 of the Lease. 500853v1 MNI CL162-53 Section 2.Redemption of Authority Bonds. 2.01. It is determined that it is in the best interests of the sound financial management of the Authority and the City that the principal amount of the Authority Bonds coming due on February 1, 2018 and thereafter, comprising all of the Authority Bond subject to redemption, be prepaid and redeemed on the Redemption Date (or on the first date thereafter for which the registrar for the Authority Bonds (the s), and the Authority Bonds are hereby called for redemption on that date in the aggregate principal amount of $3,700,000, subject to adoption by the City of the City Resolution. 2.02. The Registrar is authorized and directed to mail notice of call for redemption of the Authority Bonds in the form attached hereto as EXHIBIT A to the registered owner of the Authority Bonds to be redeemed at the address shown on the registration books kept by the Registrar. 2.03. Officials of the Authority are authorized and directed to take all actions and execute any documents necessary to carry out redemption of the Authority Bonds, the satisfaction of related documents, and the conveyance of fee title to the Site and the Improvements to the City as of the Redemption Date. Adopted by the Board of Commissioners of the Columbia Heights Economic Development th Authority this 12 day of June, 2017. By Its President Attest: By Its Executive Director 2 500853v1 MNI CL162-53 EXHIBIT A NOTICE OF CALL FOR REDEMPTION $5,040,000 COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY PUBLIC FACILITY LEASE REVENUE BONDS SERIES 2007B (MUNICIPAL LIQUOR STORES PROJECT) NOTICE IS HEREBY GIVEN that, by order of the Board of Commissioners of the Columbia there have been called for redemption and prepayment on August 1, 2017 all outstanding bonds of the Authority designated as Public Facility Lease Revenue Bonds, Series 2007B (Municipal Liquor Stores Project), dated September 19, 2007, having stated maturity dates of February 1 in the years 2020 through 2030, both inclusive, totaling $3,700,000 in principal amount, and with the following CUSIP numbers: Year of Maturity Amount CUSIP 2020 $ 650,000 19768P AL0 2023 755,000 19768P AP1 2027 1,210,000 19768P AT3 2030 1,085,000 19768P AW6 The bonds are being called at a price of par plus accrued interest to August 1, 2017, on which date all interest on said bonds will cease to accrue. Holders of the bonds hereby called for redemption are requested to present their bonds for payment at the main office of U.S. Bank National Association, in the City of Saint Paul, Minnesota, on or before August 1, 2017: U.S. Bank National Association Corporate Trust Services 111 Fillmore Avenue East St. Paul, MN 55107 Important Notice: In compliance with the Economic Growth and Tax Relief Reconciliation Act of 2003, the paying agent is required to withhold a specified percentage of the principal amount of the redemption price payable to the holder of any bonds subject to redemption and prepayment on the redemption date, unless the paying agent is provided with the Social Security Number or Federal Employer Identification Number of the holder, properly certified. Submission of a fully executed Request for Taxpayer Identification Number and Certification, Form W-9 (Rev. December 2011), will satisfy the requirements of this paragraph. Dated: ______________, 20___. A-1 500853v1 MNI CL162-53 BY ORDER OF THE BOARD OF COMMISSIONERS OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY By /s/ Walter R. Fehst Executive Director Columbia Heights Economic Development Authority A-2 500853v1 MNI CL162-53