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HomeMy WebLinkAbout1987-150 CCR1 Member Celia Scott resolution and moved its adoption: WHEREAS, RESOLUTION NO. 87 -150 RESOLUTION RECITING A PROPOSAL FOR A FINANCING PROGRAM FOR A MULTIFAMILY RENTAL HOUSING DEVELOPMENT (THE "PROJECT GIVING PRELIMINARY APPROVAL TO THE PROJECT AND THE FINANCING PROGRAM PURSUANT TO MINNESOTA STATUTES, CHAPTER 462C, AUTHORIZING THE ISSUANCE OF REVENUE BONDS, AUTHORIZING THE SUBMISSION OF THE FINANCING PROGRAM FOR APPROVAL TO THE MINNESOTA HOUSING FINANCE AGENCY AND AUTHORIZING THE PREPARATION OF NECESSARY DOCUMENTS AND MATERIALS IN CONNECTION WITH THE PROJECT AND FINANCING PROGRAM (MARANATHA HOUSING PROJECT) introduced the following (a) Minnesota Statutes, Chapter 462C (the "Act confers upon cities, or housing and redevelopment authorities or port authorities authorized by ordinance to exercise on behalf of a city the powers conferred by the Act, the power to issue revenue bonds to finance 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; (b) The City of Brooklyn Center, Minnesota (the "City adopted its Minnesota Statutes, Chapter 462C Housing Plan (the "Housing Plan on or about September 20, 1982, after holding a public hearing thereon, all in accordance with the requirements of the Act; and such Housing Plan was amended by the City on or about November 22, 1982; (c) The Housing Plan provides a general description of programs to be implemented to meet the housing needs identified in the Housing Plan, including financing programs to provide affordable 1 RESOLUTION NO. 87 150 housing to elderly persons and persons of low and moderate income; (d) The City has received from Maranatha Ministeries Foundation, Inc., a Minnesota nonprofit corporation (the "Developer a proposal that the City undertake a program to finance a multifamily housing development (the "Project hereinafter described, through the issuance of revenue bonds or obligations (the "Bonds pursuant to the Act; (e) The City desires to: facilitate the development of rental housing within the community; encourage the development of affordable housing opportunities for residents of the City; encourage the development of housing facilities designed for occupancy by persons of low or moderate income; encourage the development of housing facilities designed for occupancy primarily by elderly persons; and encourage the development of blighted or underutilized land and structures within the boundaries of the City; and the Project will assist the City in achieving these objectives. (f) The Developer is currently engaged in owning and operating a nursing home facility (the Maranatha Baptist Nursing Home) located in the City. The Project to be financed by the Bonds consists of the construction and equipping of a multifamily rental housing development of approximately 64 rental units on land adjoining the existing Maranatha Baptist Nursing Home located at approximately 5401 69th Avenue North in the City, and consequently consists of the construction of buildings which will result in the provision of additional rental housing opportunities to persons within the community; (g) The City has been advised by representatives of the Developer that con- ventional, commercial financing to pay the capital costs of the Project is available 1 RESOLUTION NO. 87 -1.50 only on a limited basis and at such high costs of borrowing that the economic feasibility of operating the Project would be significantly reduced, but the Developer has also advised the City that with the aid of municipal financing, and resulting low borrowing costs, the Project is economically more feasible; (h) A public hearing on the Project and the financing program therefor was held on July 13, 1987, after notice was published, all as required by Minnesota Statutes, Section 462C.05, subd. 5, at which public hearing all those appearing at said hearing who desired to speak were heard and written comments, if any, were considered; (i) The City submitted the financing program for the Project to the metropolitan council or the regional development commission for the area in which the city is located, and such reviewing agency was given the opportunity to comment thereon all as required by Minnesota Statutes, Section 462C.04, subd. 2; (j) 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 Brooklyn Center, Minnesota, as follows: 1. The City hereby gives preliminary approval to the proposal of the Developer that the City undertake the Project, described above, and the program of financing therefor, pursuant to Minnesota Statutes, Chapter 462C, consisting of the financing of a multifamily rental housing development within the City pursuant to the Developer's specifications and to a revenue agreement between the City and the Developer (or a separate, wholly -owned nonprofit subsidiary of the Developer) on such terms and conditions with provisions for revision from time to time as necessary, so as to produce income and revenues sufficient to pay, when due, the principal and interest on the Bonds in a total principal RESOLUTION NO. 87 -150 1 amount not to exceed $4,500,000 to be issued pursuant to the Act to finance the Project; and said agreement or agreements may also provide for the entire interest of the Developer (or separate, wholly -owned nonprofit subsidiary of the Developer) therein to be mortgaged to the purchasers of the Bonds, or a trustee for the holder(s) of the Bonds, and other security instruments to the purchasers of the Bonds or to the trustee for the holder(s) of the Bonds; and the City hereby undertakes preliminarily to issue its revenue bonds in accordance with such terms and conditions; 2. At the option of the City, the financing may be structured so as to take advantage of whatever means are available and are permitted by law to enhance the security for, or marketability of, the Bonds; provided that any such financing structure must be consented to by the Developer. 3. On the basis of information available to the City, it appears, and the City hereby finds, that the Project constitutes a multifamily housing development within the meaning of Section 462C.05 of the Act; that the Project will be designed for rental primarily to the elderly; the availability of the financing under the Act and the willingness of the City to furnish such financing will be a substantial inducement to the Developer (or separate, wholly owned nonprofit subsidiary of the Developer) to undertake the Project, and that the effect of the Project, if undertaken, will be to encourage the provision of additional multifamily rental housing opportunities to residents of the City, to assist in the redevelopment of blighted and marginal land and to promote more intensive development and use of land within the City; 4. The Project, and the program to finance the Project by the issuance of revenue bonds, is hereby given preliminary approval by the City subject to the approval of the financing program by the Minnesota Housing Finance Agency "MHFA and subject to final approval by the City, the Developer and the purchasers of the Bonds as to the ultimate details of the financing of the project; 5. In accordance with subdivision 5 of Section 462C.05, Minnesota Statutes, the Clerk is hereby authorized and directed to submit the program for financing the Project to MHFA, requesting its approval, and other officers, and employees and agents of the City and the Housing and Redevelopment Authority of the City are hereby authorized to provide MHFA with preliminary information as it may require; 1 RESOLUTION NO. 87 -150 6. The Developer has agreed and it is hereby determined that any and all costs incurred by the City in connection with the financing of the Project whether or not the project is carried to completion and whether or not approved by MHFA will be paid by the Developer (or separate, wholly -owned nonprofit subsidiary of the Developer); 7. Briggs and Morgan, Professional Association, acting as bond counsel, and such investment bankers as may be selected by the City with the consent of the Developer, are authorized to assist in the preparation and review of necessary documents relating to the Project and the financing program therefor, to consult with the City Attorney, Developer and purchasers of the Bonds (or trustee for the purchasers of the Bonds) as to the series, maturities, interest rates, security and other terms and provisions of the Bonds and as to the covenants and other provisions of the necessary documents and submit such documents to the City for final approval; 8. Nothing in this Resolution or the documents prepared pursuant hereto shall authorize the expenditure of any municipal funds on the Project other than the revenues derived from the Project or otherwise granted to the City for this purpose. The Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property or funds of the City except the revenues and proceeds pledged to the payment thereof, nor shall the City be subject to any liability thereon. The holder(s) of the Bonds shall never have the right to compel any exercise of the taxing power of the City to pay the outstanding principal on the Bonds or the interest thereon, or to enforce payment thereon against any property of the City. The Bonds shall recite in substance that the Bonds, including the interest thereon, are payable solely from the revenues and proceeds pledged to the payment thereof. The Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation. 9. In anticipation of the approval by MHFA and the issuance of the Bonds to finance all or a portion of the Project, and in order that completion of the project will not be unduly delayed when approved, the Developer (or separate, wholly -owned nonprofit subsidiary of the Developer) is hereby authorized to make such expenditures and advances toward payment of that portion of the costs of the Project to be financed from the proceeds of the Bonds, as the Developer (or separate, wholly -owned nonprofit subsidiary of the 1 RESOLUTION NO. 87 -150 Developer) considers necessary, including the use of interim, short -term financing, subject to reimbursement from the proceeds of the Bonds if any when delivered but otherwise without liability on the part of the City. July 27, 1987 Date ATTEST: c/J '1- f f C_Q Clerk The motion for the adoption of the foregoing resolution was duly seconded by member Bill Hawes and upon vote being taken thereon, the following voted in favor thereof: Dean Nyquist, Celia Scott, and Bill Hawes; and the following voted against the same: Gene Lhotka, whereupon said resolution was declared duly passed and adopted. 6