Loading...
HomeMy WebLinkAbout6.e. Set Public Hearing for Scott Carver Dakota CAP Agency, Inc. Private Activity Tax-Exempt FinancingAGENDA ITEM: Set Public Hearing for Scott Carver Dakota CAP Agency, Inc Private Activity Tax Exempt Financing AGENDA SECTION: Consent PREPARED BY: Jeff May, Finance Director AGENDA NO. ATTACHMENTS: Resolution, Notice of Public Hearing, Application APPROVED BY: RECOMMENDED ACTION: Motion to adopt a Resolution Calling For A Public Hearing On The Issuance Of A Commercial Development Revenue Note (Scott Carver Dakota CAP Agency, Inc. Project) 4 ROSEMOUNT CITY COUNCIL City Council Meeting Date: November 7, 2006 EXECUTIVE SUMMARY ISSUE The issue before the City Council is the request to hold a public hearing on December 5 to consider the issuance of private activity tax exempt bonds for the Scott Carver Dakota CAP Agency. BACKGROUND Council is asked to consider setting a public hearing to consider the issuance of tax- exempt bonds for the Scott Carver Dakota CAP Agency to help finance a project in the City of Rosemount. Under Minnesota Statutes, Chapter 469, organizations may seek tax exempt financing through government entities when issuing debt for improvements that are within that taxing entity's geographic boundaries. The CAP Agency has completed the City's application (attached) and submitted a check for the apphcatton fee. The application has been reviewed by staff, as well as by a representative of Springsted, our financial consultants, and a representauve of Briggs Morgan, our bond counsel 'I'he information provided in the application appears to comply with the City's Private Activity Tax- Exempt Policy and the CAP Agency is ready to move forward in the financing process. The next step is to hold a public hearing to get the City Council's approval for financing approximately $840,000 of project costs. Upon compleuon of the public hearing on December 5` and approval by the City Council, their financing may be completed prior to the end of the year SUMMARY Staff is recommending that the City Council approve the attached resolution calling for the pubhc heanng on December 5` Packet page 94 of 177 CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION 2006 RESOLUTION CALLING FOR A PUBLIC HEARING ON THE ISSUANCE OF A COMMERCIAL DEVELOPMENT REVENUE NOTE (SCOTT CARVER DAKOTA CAP AGENCY, INC. PROJECT) A. WHEREAS, Minnesota Statutes, Sections 469.152 through 469.1651 (the "Act gives mumcipahues the power to Issue revenue obligations for the purpose of promoting the welfare of the state by the active attraction and encouragement and development of economically sound industry and commerce to prevent so far as possible the emergence of blighted and marginal lands and areas of chronic unemployment, and B. WHEREAS, the City Council of the City of Rosemount, Minnesota (the "City"), has received from Scott Carver Dakota CAP Agency, Inc, a Minnesota nonprofit corporation (the "Borrower a proposal that the City undertake a program to assist in financing the remodeling of an existing building and refinancing of existing debt relating to the building through the Issuance of a revenue note or bonds (in one or more series) (the "Note pursuant to the Act; and C. WHEREAS, before proceeding with consideration of the request of the Borrower it is necessary for the City to hold a public hearing on the proposal pursuant to the Act: NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Rosemount, Minnesota, as follows 1 A public heanng on the proposal of the Borrower will be held at the time and place set forth in the form of Nonce of Pubhc Hearing attached hereto as Exhibit A. 2. The City Clerk is hereby authorized and directed to cause nonce of the hearing to be given one pubhcation in the official newspaper of the City and a newspaper of general circulation available in the City, not less than 14 days nor more than 30 days prior to the date fixed for the hearing, substantially in the form of the attached Nonce of Public Hearing. 1958138v1 Packet page 95 of 177 A11LST• ADOPTED this 7th day of November, 2006. Amy Domeier, City Clerk Motion by. Seconded by: Voted in favor. Voted Against. Members Absent: 1958138v1 2 Packet page 96 of 177 William H Droste, Mayor RESOLUTION 2006 STATE OF MINNESOTA COUNTY OF DAKOTA CITY OF ROSEMOUNT I, Amy Domeier, duly appointed, acting and qualified City Clerk of the City of Rosemount do hereby certify that I have examined the City of Rosemount records and the Minute Book of said City for the meeting of the 7th of November, 2006 and that the attached copy of the RESOLUTION CALLING FOR A PUBLIC HEARING ON THE ISSUANCE OF A COMMERCIAL DEVELOPMENT REVENUE NOTE was approved and is a true and correct copy of the Ctty Proceedings relating to said Resolution. IN WITNESS WHEREOF, I have hereunto set my hand and seal of said City this day of November, 2006 P,tfoietpage 97 of 177 CERTIFICATE Amy Domeier, City Clerk City of Rosemount Dakota County, Minnesota RESOLUTION 2006 EXHIBIT A NOTICE OF PUBLIC HEARING ON A PROPOSAL FOR ISSUANCE OF A COMMERCIAL DEVELOPMENT REVENUE NO IL (SCOTT CARVER DAKOTA CAP AGENCY, INC. PROJECT) Notice is hereby given that a public heating shall be conducted by the Ctty Council of the City of Rosemount, Minnesota on Tuesday, December 5, 2006 at 7 30 p m. at the City Hall located at 2875 145` Street West, Rosemount, Minnesota, to consider the proposal of Scott Carver Dakota CAP Agency, Inc., a Minnesota nonprofit corporanon "Borrower that the City assist in financing the remodeling of an existing building located at 2496 145 Street West in the City (the "Project and the refinancing of existing debt and certain other costs related to the Project by the issuance of a revenue note or other obligation in an amount not to exceed $900,000 pursuant to Minnesota Statutes, Sections 469.152 to 469 1651, as amended The Project is owned by the Borrower. The note or other obhganons if and when issued will not constitute a charge, hen or encumbrance upon any property of the City except the Project, and such note or obligations will not be a charge against the City's general credit or taxing powers, but will be payable from sums to be paid by the Borrower pursuant to a revenue agreement. A draft copy of the proposed apphcanon to the Commissioner of the Department of Employment and Economic Development, State of Minnesota, for approval of the Project, together with all attachments and exhibits thereto, is available for public inspection during normal business hours, Monday through Friday, at the City Hall in the City At the time and place fixed for the public hearing, the City will give all persons who appear at the hearing an opportunity to express their views with respect to the proposal In addition, interested persons may file wntten comments respecting the proposal with the City Clerk at or prior to the pubhc hearing 1958138v1 A -1 Packet page 98 of 177 PART IV CITY OF ROSEMOUNT, MINNESOTA APPLICATION FOR TAX EXEMPT FINANCING (Commercial, Industrial, Educational or Health Care) 1 APPLICANT a. Business Name Scott Carver Dakota CAP Agency, Inc. b Business Address 2496 145 Street West Rosemount, Minn. 55068 c. Business Form (corporation, partnership, sole proprietorship, etc 501©3 Pnvate Non Profit Corporation d. Authorized Representative Mary Sullivan, Executive Director e. Principal contact person and telephone number— Mary Sullivan- 651 322 -3512 or Jane Cummiskey, Finance Director— 952 402 -9843 2. PURPOSE OF REQUESTED FINANCING a New Facility (describe) b. Expansion (describe) $54,000 for Roof Replacement $27,000 for Flooring Repairs c. Refunding (attach explanatory letter) Payoff as of 11 -1 -06 $753,882.87 3. GIVE BRIEF DESCRIPTION OF NATURE OF BUSINESS, PRINCIPAL PRODUCTS, ETC. Scott Carver Dakota CAP Agency, Inc. is a private non profit community action agency servicing the needs of low income and elderly people in Scott, Carver and Dakota Counties We have been in business since 1965 and deliver programs such as Senior Dining and Meals on Wheels, Head Start, Emergency Services, Food Shelves, Weatherization, Crisis Nursery, WIC (Women, Infants and Children supplemental food program) Transitional Housing and Homeless services, Case Management and Budget Counseling. 4. ESTIMATED SOURCES AND USES PROJECT COSTS. (Not required for refunding) SOURCES: Bond proceeds $836,000 Cash $43,720 Other Loans Total Sources $879,720 Packet page 99 of 177 USES: Refunding of Contract or Deed New roof and carpet/flooring Equipment Architectural, Engineering Cost of Issuance Capitalized Interest Other Total Uses $755,000 $81,000 $43,720 $879,720 5 TOTAL FINANCING REQUESTED $840,000.00 (_100_% of project costs) 6. TYPE OF FINANCING PROPOSED: Bonds Tax Exempt Mortgage X_ Expected Term of Financing _17 Years Security Mortgage X Letter of Credit Guaranty (third party) Guaranty (personal) Unsecured Other (specify) X full faith and credit pledge of Borrower. 7. BUSINESS PROFILE. (Not required for refunding) a. Is the business located within City Boundaries? Yes b. Number of employees within the City of Rosemount geographic boundaries i. Before this project 40 of the total 160 staff positions at CAP ii. After this project 40 of the total 160 staff positions at CAP c. Approximate annual sales $12,000,000 Community Action Agency Budget d. Length of time in business Since 1965 e. Length of time in City 2003 f. Do you have business operations in other locations? If so, where? Administration office in Shakopee along with a Food Shelf and Thrift Shop and WIC offices WIC Office and Head Start center in Chaska Packet page 100 of 177 Packet page 101 of 177 Senior Dining Sites in Waconia, Jordan, New Prague, Burnsville, West St. Paul, Shakopee, Eagan, Lakeville, Belle Plaine, Hasting, Rosemount Chaska, Watertown, Farmington, Savage, Inver Grove Heights, Chanhassen, Mendota Heights, Apple Valley, and Prior Lake Head Start Centers in Rosemount, Jordan, South St. Paul, Chaska Savage, Shakopee, Eagan, Apple Valley, Burnsville, Lakeville Farmington, Prior Lake and Watertown. Transitional houses in Jordan, Shakopee, Lakeville, So. St Paul, Eagan, Prior Lake, Apple Valley, Burnsville and Savage. 8. NAMES OF: a. Underwriter (name and contact person) Wells Fargo Brokerage Services, LLC (Tim Joyce 612- 667 -6785) b Corporate Counsel To be determined c. Underwriter's Counsel N/A 9. WHAT IS YOUR TARGET DATE FOR: a. Construction start January 2007 Flooring b. Construction completion February, 2007 10. ATTACHMENTS' TIM and BOND COUNSEL will complete these items a. Project description materials b. Draft resolution calling for public hearing c. Notice of public hearing d. Draft of preliminary resolution e. Draft application to Department of Trade and Economic Development necessary attachments f. Financial feasibility letter g Preliminary bond counsel opinion h Initial filing fee (to be set by City Council) i. Indemnification Letter of Agreement Packet page 102 of 177 The applicant further states that it has been furnished a copy of the City of Rosemount's Private Activity Tax Exempt Financing Guidelines and is aware of its content and agrees to be bound by its terms and the terms of the indemnification letter The applicant, by itself and not in conjunction with the City, represents that the applicant has done reasonable investigation and made inquiry and is now convinced that the project which is the subject of these bonds is feasible and appropriate to undertake considering all appropriate city, county and state regulations and requirements The adoption of a resolution giving preliminary approval to the issuance of revenue bonds shall not be deemed to establish a legal obligation on the part of the City or the City Council to issue revenue bonds for the project nor does it constitute an approval or waiver by the City of any land use, planning, permitting or other municipal approvals required for the project For further information, contact' City Finance Director City of Rosemount 2875 145th Street West Rosemount, MN 55068 -4997 (651) 322-2031 Packet page 103 of 177 DATE Applicant BY Mary Sullivan, Executive Director October 27, 2006 City of Rosemount Mayor And Members of the Council PART V INDEMNIFICATION LETTER OF AGREEMENT RE Application of Scott Carver Dakota CAP Agency, Inc. for Tax Exempt Revenue Bond Financing by the City of Rosemount Dear Mayor and City Council Members This letter of agreement is given by Scott Carver Dakota CAP Agency, Inc., a 501©3 private non profit corporation under the laws of Minnesota "Applicant as required by the City of Rosemount in connection with its consideration of an application for tax exempt revenue bond financing for the project described in the application Applicant hereby covenants, warrants and agrees as follows' 1. Applicant agrees to pay or reimburse the City for any and all costs and expenses which the City may incur in connection with its consideration of the project and the granting of tax exempt revenue bond financing therefore, whether or not the project is preliminarily approved by the City, whether or not the project is approved by the Sate of Minnesota, whether or not revenue bond financing is finally approved by the City, whether or not the bonds are issued and sold, and whether or not the project is carried to completion 2. Applicant agrees to indemnify and hold the City, its officers, employees and agents harmless against any and all losses, claims, damages, expenses or liabilities, including attorneys fees incurred in their defense, to which the City, its officers, employees and agents may become subject in connection with the City's consideration, issuance or sale of the bonds for Applicant's project and the carrying out of the transactions contemplated by this agreement and any resolutions adopted, or agreements executed by the City in connection with the issuance of its bonds for this project 3. Applicant here by releases the City, its officers, agents and employees from any claims, causes of action, losses, damages, or liabilities which it may have against the City, its officers, agents, and employees or which it may incur in connection with the City's consideration of the application for industrial development revenue bond financing for Applicant's project; the failure of the City, in its discretion, to issue tax exempt revenue bonds for Applicant's project, the issuance and sale of the bonds, the construction of the project, or any other matter or thing of any type or nature whatsoever which may arise in connection with the foregoing 4. Applicant is aware of the City's application and administrative fee structure for tax exempt financing and agrees and covenants that all such fees will be paid in the amount and at the times required. The applicant, by itself and not in conjunction with the City, represents that the applicant has done reasonable investigation and made inquiry and is now convinced that the project which is the subject of these bonds is feasible and appropriate to undertake considering all appropriate city, county and state regulations and requirements. The adoption of a resolution giving preliminary approval to the issuance of revenue bonds shall not be deemed to establish a legal obligation on the part of the City or the City Council to issue revenue bonds for the project nor does it constitute an approval or waiver by the City of any land use, planning, permitting or other municipal approvals required for the project. Packet page 104 of 177 Dated' 10 -27 -06 (Applicant) Packet page 105 of 177 By Mary Sullivan Its Executive Director