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HomeMy WebLinkAbout2024-048 42nd and Central Bonding CD JPACITY OF COLUMBIA HEIGHTS, MINNESOTA RESOLUTION NO.2024-48 Approving, Following A Duly Noticed Public Hearing, The Issuance By The Dakota County Community Development Agency Of Conduit Multifamily Housing Revenue Bonds On Behalf Of Roers Burnsville Apartments Owner LLC Using, In Part, Recycled Bonding Authority From Conduit Multifamily Housing Revenue Bonds Previously Issued By The City For The 42°1 & Central Apartments Project And Approving A Joint Powers Agreement WHEREAS, the City of Columbia Heights, Minnesota (the "City") is a home rule charter city, municipal corporation, and political subdivision duly organized and existing under its Charter and the Constitution and laws of the State of Minnesota and is authorized under Minnesota Statutes, Chapter 462C, as amended (the "Housing Act"), to issue revenue obligations to finance multifamily housing developments; and WHEREAS, the Housing Act confers upon cities the power to issue revenue bonds to finance or refinance a program for the purposes of planning, administering, making or purchasing loans with respect to one or more multifamily housing developments within the boundaries of the city or under a joint powers agreement with the jurisdiction in which the development is located and pursuant to Minnesota Statutes, Section 471.59, as amended. By the terms of a joint powers agreement entered into through action of their governing bodies, two cities may jointly or cooperatively exercise any power common to the contracting parties or any similar powers, including those which are the same except for the territorial limits within which they may be exercised; and WHEREAS, Roers Burnsville Apartments Owner LLC, a Minnesota limited liability company (the "Borrower"), desires to finance the acquisition, construction, and equipping of an approximately 172- unit multifamily rental housing development and facilities functionally related and subordinate thereto, to be located at the properties which currently have an address of 151 Burnsville Parkway and 201 Burnsville Parkway in the City of Burnsville, Minnesota, for occupancy by low and moderate income households (the "Project"); and WHEREAS, the Borrower will be the initial owner and operator of the Project; and WHEREAS, in order to better leverage public funding by recycling bonding authority as permitted by Section 146(i)(6) of the Internal Revenue Code of 1986, as amended (the "Code"), the Borrower has proposed that the Dakota County Community Development Agency (the "CDA") undertake a housing finance program (the "Housing Program") to finance the Project pursuant to the Act through the issuance by the CDA of housing revenue bonds or other obligations in one or more taxable and/or tax-exempt series, including any temporary or interim financing to preserve the recycled bonding authority, in an aggregate principal amount not to exceed $37,000,000 (the Bonds); and WHEREAS, the Bonds will be payable solely from revenues of the Borrower, and will not be a general or moral obligation of the City or the CDA or any other political subdivision of the State of Minnesota, 4875-9153-1453.3 but will be payable solely from revenues of the Borrower, to the extent and in the manner provided in the documents executed in connection with the issuance of the Bonds; and WHEREAS, Section 146(i)(6) of the Code permits the reuse of bonding authority for affordable housing projects and treats the reuse as a refunding for tax purposes if: (i) the "refunding" occurs within four years after the original bonds were issued, (ii) the "refunding" bonds are issued within six months after the principal payment of the original bonds, and (iii) the "refunding" bonds mature within 34 years of the original issue date, and the Borrower has represented to the City that the Bonds will meet the requirements of Section 146(i)(6) of the Code with respect to the reuse of bonding authority from the City's Multifamily Housing Revenue Bonds (42nd & Central Apartments Project), Series 2022A and 2022B, issued in the original aggregate principal amount of $10,446,000 (the "Original City Bonds"); and WHEREAS, in addition, Section 146(i)(6) of the Code requires approval of the Bonds in accordance with Section 147(f) of the Code before the issuance thereof, and under Section 147(f) an applicable elected representative of each governmental unit in which facilities to be financed and refinanced by the Bonds are located must approve the issuance of the Bonds following a public hearing; and WHEREAS, pursuant to the Act, Minnesota Statutes, Sections 471.59 and 471.656, as amended, and Section 147(f) of the Code, (i) a public hearing on the proposal by the Borrower that the CDA issue the Bonds, using in part, recycled bonding authority from the Original City Bonds, under the Joint Powers Agreement hereinafter described, was held by the City Council of the City on this date following duly published notice, at which time all persons who desired to speak were heard; and (ii) a public hearing on the Housing Program, the Project, and the proposed issuance of the Bonds by the CDA will be held by the Board of Commissioners of the CDA on or about June 26, 2024 following duly published notice, at which time all persons who desire to speak may be heard; and WHEREAS, there has been presented to the City Council of the City the form of a Joint Powers Agreement, dated as of or after June 28, 2024, between the City and the CDA, and acknowledged and accepted by the Borrower (the "Joint Powers Agreement"); and WHEREAS, the Borrower's proposal calls for the CDA to loan the proceeds realized upon the issuance and sale of the Bonds to the Borrower pursuant to one or more loan agreements wherein the Borrower will be obligated to pay all costs and expenses of the City incident to the issuance of the Bonds; and WHEREAS, the City desires to facilitate the preservation, construction, acquisition and rehabilitation of affordable multifamily housing facilities within the State of Minnesota and the efficient use of limited resources available for funding affordable housing; and the Project will assist the City in achieving these objectives; and WHEREAS, no public official of the City has either a direct or indirect financial interest in the Project nor will any public official either directly or indirectly benefit financially from the Project. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Columbia Heights, Minnesota, as follows: 1. That a public hearing has been conducted in accordance with the law and closed. 4875-9153-1453.3 2. Upon payment of any applicable fees charged by the City, the City hereby consents to and approves the issuance of the Bonds including any temporary or interim financing to preserve the recycled bonding authority, by the CDA to finance the Project using, in part, recycled bonding authority from the Original City Bonds in an amount to be determined by the Mayor and the City Manager of the City (the "City Officials") and set forth in the Joint Powers Agreement prior to the execution thereof, and the execution and delivery thereof by the City Officials shall be conclusive evidence of such determination. 3. The Joint Powers Agreement is approved in substantially the form submitted. The City Council hereby authorizes and directs the City Officials of the City to execute and deliver the Joint Powers Agreement and any other necessary documents, agreements and instruments approved by the City's legal counsel in connection with the issuance of the Bonds. 4. In no event shall the Bonds ever be payable from or charged upon any funds of the City; nor shall the City be subject to any liability thereon; no owners of the Bonds shall ever have the right to compel the exercise of the taxing power of the City to pay any of the Bonds or the interest thereon, nor to enforce payment thereof against any property of the City; the Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City; and the Bonds do not constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation. The City Officials, staff and legal counsel are authorized and directed to take all necessary action to implement this resolution. 5. The Borrower has agreed and it is hereby determined that any and all costs incurred by the City in connection with the financing of the Project, including attorneys' fees, will be paid by the Borrower, whether or not the Project is carried to completion and whether or not the CDA issues the Bonds. 6. Kutak Rock LLP, acting as bond counsel to the CDA, is authorized to assist in the preparation and review of necessary documents relating to the Project and the financing program therefor. Passed this 24th day of June, 2024 Offered by: Jacobs Seconded by:Buesgens Roll Call: All Ayes A ada Ma quez Simul , Mayor Attest: Sara Ion, City Clerk/Council Secretary 4875-9153-1453.3