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CR 04-061 Bond Sale St Joseph GITY or . ~ April 12, 2U04 Hop KIN S Council Report 2004-061 . PUBLIC HEARING: SALE OF REVENUE BOND, CHURCH OF ST. JOSEPH Proposed Action Staff recommends approval of the following motion: adopt Resolution 2004-031, authorizim; the issuance and sale of revenue bonds to provide funds for a proiect on behalf of the Church of S1. Joseph, subject to staff conditions as detailed in Council RepOli 2004-061. Overview St. Joseph's Church is proposing to lease the John Ireland School to a new charter school. the Mainstreet School For Performing Arts. To facilitate this transaction, they need to complete a variety of improvements to the existing school. These improvements are detailed in the attnched application from the church. The total cost of the improvements will be S2.4 million, A public hearing is req uired as part of the overall review process. The proposed action would combine the preliminary and final resolutions for issuance and sale. As a result, this would be the only action necessary by the City Council on this matter. Primary Issues To Consider . · What is the Mainstreet School For Performing Arts? . What is the purpose of this financing? · Does the project meet the requirements of City policy regarding taxable/tax exempt tinancing? · What are the implications to the City as relate to this action? . Has legal cOLlnsel reviewed this matter'? SUPPol,ting Documents . Application by Church of S1. Joseph . Resolution 2004-031 . Memo from Stefanie Galey. Faegre & Benson /~ , ' ..~ .. , , . / i / / / ;.1 :-... ,I I ,/ . ~~ L---~l , Jim I<A:~rflgfi!l / '- Plalll~ing & Ecotlontc Development Director . Financial Impact: $ NI A Budgeted: Y/N ___~ Source: Related Ducuments (elp, ERP, etc.): Notes: Council Report 2004-061, April 12, 2004 Page 2 . Primary Issues To Consider . What is the Mainstreet School For Performing Arts? This is a nev./ charter school, which is a collaborative effort of Hopkins School District 270 and the Hopkins Center For Perf0l111ing Arts. It will be a four-year high school oriented to students interested in the performing mts. The school will open with ninth through tenth grades, with approximately 202 students. 11 is estimated that total enrollment when fu11y operational with all four grades will be approximately 424. The first classes will begin this fall. . What is the purpose of this financing'! Local units of govemment are authorized to issue tax-exempt revenue bonds to facilitate projects that are felt to be beneficial to the community. To utilize this type of financing tool, the applicant must meet very specific federal requirements. The bond financing is, for the most part, available only for certain types of industrial or housing projects or for the benefit of certain non-profit, tax-exempt organizations. Financing through this method provides for a lower interest rate than could be secured at a private lending institution. . . Does the project meet the requirements of City policy regal-ding taxable/tax exempt financing? The City of Hopkins has a policy relating to revenue bond financing. The policy allows the City to consider financing for any existing business within the City that is proposing to expand, relocate, or rehabilitate an existing building. The proposed project would meet the requirements of the policy, . What al-e the implications to the City as relates to this action? Revenue bonds are secured by a pledge of repayment strictly from the proposed project. The City is not liable to make any payment should there be a default. The City has not been informed that the owner of the subject property is presently in default on any bond payments for the existing revenue bond that they arc obligated to repay. . lias legal counsel reviewed this matter'? The City Allomey has reviewed the document related to this transaction, Stefanic Galey of Faegre & Benson is also representing the City as bond counsel. e --- -- ------- Coullcil Report 2004-061, April 12, 2004 Page 3 . What are the staff conditions? . Staff is recommending that the application administrative fees be waived with approval of this resolution. These fees, in accordance with the policy, are as follows: Application fee $5,000 Administrative fee 1/8 of 1% of the outstanding principal balance of the bonds. The reason staffis recommending this fee waiver is to demonstrate City suppOli for this project and to make it more financially feasible. With this waiver it would be understood that the City would still be reimbursed for all out-of-pocket expenses relating to this financing, including but not limited to legal fees, financial analyst fees, and bond counsel fees. Alternatives The City Council has the following altematives regarding this action: 1 ) Approve the action as recommended by staff . 2) Deny the approval for the sale of bonds, With this action, St. Joseph's Church would need to determine whether they wish to proceed with this project based on the necessity to secure financing from a private lending institution. 3) Continue for additional inComlation. . . CITY OF HOPKINS Hennepin County, Minnesota RESOLUTION NO. 2004-031 RESOLUTION PROVIDING FOR THE ISSUANCE AND SALE OF A SCHOOL FACILITY REVENUE NOTE, TO PROVIDE FUNDS FOR A PROJECT ON BEHALF OF THE CHURCH OF ST. JOSEPH OF HOPKINS BE IT RESOLVED by the City Council of the City of Hopkins, Minnesota (the "City"), as follows: L Authority. The City is, by the Constitution and laws of the State of Minnesota, including Minnesota Statutes, Sections 469.152 to 469.1651, as amended (the "Act"), authorized to issue and sell its revenue bonds for the purpose of financing costs of authorized projects and to enter into agreements necessary or convenient in the exercise of the powers granted by the Act. 2, Authorization of Proiect: Documents Presented. The Church of St. Joseph oC . Hopkins, a Minnesota parish corporation (the "Church"), has proposed to this Council that the City issue and sell its City of Hopkins School Facility Revenue Note (The Church of St. Joseph of Hopkins Project), Series 2004 (the "Note"), in an aggregate principal amount not to exceed $2,400,000 pursuant to the Act and loan the proceeds thereof to the Church in order to finance costs incurred in the renovation and equipping of the Church's school building located at 1320 Main Street in the City (referred to generally herein, together with any related site improvements, as the "Project"). Forms of the following documents have been submitted to the City and are now on file in the office oC the City Clerk: (a) Loan Agreement (the "Loan Agreement") between the City and the Church, whereby the City agrees to make a loan to the Church and the Church agrees to pay amounts in repayment of the loan sufficient to provide for the fu11 and prompt payment of the principal of, premium, if any, and interest on the Note when due; (b) Pledge Agreement (the "Pledge Agreement ") from the City to the lender named therein (the "Lender"), by which the City assigns to the Lender its interest in the Loan Agreement; . ~Il IO'l:2071 (lJ 1 AL I IIORli::IN(j RESOLUTION . (c) Escrow Agreement (the "Escrow Agreement") between the Church and thc Lender, by which the Lender will disburse proceeds of the Notc to the Church for the Project; and ( d) the Note. J. Findings. It is hereby found, determined and declared that: ( a) Th ere is no litigation pending or, to the best of its knowledge, threatened against the City relating to the Note, the Loan Agreement or the Pledge Agreement or questioning the due organization of the City, or thc pO\vers or authority of the City to issue the Note and undertake the transactions contemplated hereby. (b) The execution, delivery and performance of the City's obligations under the Note, the Loan Agreement and the Pledge Agreement do not and will not violate any order of any court or other agency of government of which the City is aware or in which the City is a party, or any indenture, agreement or other instrument to which the City is a party or by which it or any of its property is bound, or be in conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a . default under any such indenture, agreement or other instrument. (c) The Note will be issued by the City upon the tell11S to be agreed upon by the Lender and the Church provided that the interest rate shall not exceed 5,5% per annum, and the City's interests in the Loan Agreement ( except for its rights to indemnity and payment of expenses and repayment of advances) will be pledged to the Lender as security for the payment of principal of premium, ifany, and interest on the Note. (d) The Loan Agreement provides for payments by the Church of sLich amounts as will be sufficient to pay the principal of, premium, if any, and interest on the Note when due. (c) Under the provisions of the Act, and as provided 111 the Loan Agreement, the Note is not to be payable from nor charged upon any funds other than amounts payable pursuant to the Loan Agreement which are pledged to the payment thereof, the City is not subject to any liability thereon; no owners of the Note shall ever have the right to compel the exercIse of the taxing power of the City to pay any of the Note or the interest thereon, nor to enforce payment thereof against any . property 0 f the City (other than the interest of the City in the Loan payments to be made by the Church under the Loan Agreement); and the :--Jote shaH recite that sllch Note, including interest thereon, shall not 'vII 111'121171 ()] 2 AUTHORIZINCi RFSOLlITluN . constitute or give rise to a charge against the general credit or taxing powers of the City. (f) As required by the Act and Section l47(f) of the lntemal Revenue Code of 1986, as amended, the City Council of the City conducted a public hearing on Tuesday, April 20, 2004, on the proposal to undertake and finance the Project after publication in the official newspaper and a newspaper of general circulation in the City of a notice setting forth the time and place of hearing; stating thc general nature of the Project and an estimate of the principal amount of bonds or other obligations to be issued to finance the Project; stating that a draft copy of the proposed Application to the Minnesota Depaliment of Employment and Economic Development (the "Depmiment"), together with all attachments and exhibits thereto, was available for public inspection at the offices of the City, at all times between the hours of 8:00 a.m. to 4:30 p.m each day except Saturdays, Sundays and legal holidays to and including the day of hearing; and stating that all pariies who appear at the public hearing shall have an opportunity to express their views with respect to the proposal. (g) It is hereby found, detell1lined and declared tl1at the Project fmihers the purposes set fOl1h in the Act. . 4, Approval and Execution of Documents, The fOllllS of Note, Loan Agreement and the Pledge Agreement, refelTed to in paragraph 2, are approved, The Loan Agreement and the Pledge Agreement shall be executed in the name and on behalf of the City by the Mayor, the City Manager and the City Clerk, or executed or attested by other officers of the City, in substantially the foml on file, but with all such changes therein, not inconsistent witll the Act or other law, as may be approved by the officers executing the same, which approval shall be conclusively evidenced by the execution thereof and then shall be delivered to the Trustee. S, Submission of Application. In accordance with the requirements of the Act, officers of the City are hereby authorized and directed to submit the proposal for the Projcct to the Depm1ment to requcst its approval thereof, and City officers, employees, and agents are hereby authorized to provide the Department \vith such mCormation as it may require. 6. Approval, Execution and Delivery of Note. Upon receipt of the Department's approval, the City shall proceed forthwith to issue the Note, in a principal amount not to exceed $2,400,000. The Mayor, City Manager, City Clerk and other City officers arc authorized and directed to prepare and execute tIle Note, . and deliver it to the Lender upon receipt of the purchase price therefor. Principal of and interest on the Note shall be payable at the office of the \11 III'J21Jil,II1 3 AIITIIORIZING RFSO] I inn", . registered owner thereof as it appears on the registration records maintained by the City Clerk in lawful money of the United States. The proposal of the Lender to purchase the Note is hereby fOllnd and dete111lined to be reasonable and is hereby accepted. The Note shall contain a recital that it is issued pursuant to the Act, and such recital shall to the extent permitted by law be conclusive evidence of the validity and regularity of the issuance thereof 7. Registration Records. The City Clerk, as registrar, shall keep registration records which shall set forth the name and registered address of the registered owner of the Note from time to time. Transfer of the Note shall be made on I y as provided in Section 9 below. 8, Mutilated, Lost, Stolen or Destroyed Note. If the Note is mutilated, lost, stolen or destroyed, the City may execute and deliver to the registered owner a new Note of like amount, date, number and tenor as that mutilated, lost, stolen or destroyed; provided that, in the case of mutilation, the mutilated Note shall first be surrendercd to the City, and in the case of a lost, stolen or destroyed Note, there shall be first furnished to tIle City and the Church evidence of such loss, theft or destruction satisfactory to the City and the Church, together with indemnity satisfactory to tllem. The City and the Church may charge the o\vner with their reasonable fees and expenses 1n replacing any mutilated, lost, . stolen or destroyed Note. 9. Transfer of Note; Person Treated as Owner. The Note shall be transferable by the owner only on the registration records of the City, upon presentation of the Note for notation of such transfer thereon at the office of the City Clerk, as Note registrar, accompanied by a written instrument of transfer in form satisfactory to the City Clerk duly executed by the registered owner or its attollley duly authorized in writing. The Note shall continue to be subject to sLLccessive transfers in such manner at the option of the registercd owner of a Note. No service charge shall be made for any such transfer, but the City Clerk may require paymcnt of a sum sufficient to cover any tax or othcr gove1l11llental charge payable in connection therewith, which the Church shall pay under the Loan Agreement. The person in whose name a Note shall be issLled or, if transfelTed, shall be registered from time to time shall be deemed and regarded as the absolute owner thereof for all pUlvoses, and payment of or on account of the principal of, premium, if any, and interest on the Note shall be made only to or upon the order of such owner thereof, or its attoll1ey duly authorized in writing, and neither the City, the Church, nor the Lender shall be affected by any notice to the contrary. All sllch payments shall be valid and effectual to satisfy and discharge the liability upon the Note to the extent of the sum or sums so paid. The Note shall be initially registered in the name of the . Lender. \11' 111').'11"] III 4 AIITI-IOI{llINli Rl::SOLl !l'IlJN . 10, Amendments, Changes and Modifications to Documents and tbis Resolution, Except pursuant to the Loan Agreement, the City shall not enter into or make any change, modification, alteration or termination of the Loan Agreement, the Pledge Agreement or this Resolution. II. .covenants with Holder~ Enforceability. All provisions of the Note and of this Resolution and all representations and undertakings by the City in the Loan Agreement and the Pledge Agreemcnt arc hereby declared to be covenants betwcen the City and the Lender and successor holders of the Note and shall be enforceable by the Lcnder or any such holders in a proceeding brought for that purpose. 12. Definitions and Interpretation. Tet111S not otherwise defined in this Resolution but defined in the Loan Agreement shall have the same meanings in this Resolution and shall be interpreted herein as provided therein. In case any provision of this Resolution is for any reason illegal or invalid or inoperablc, such illegality or invalidity or lnoperabi1ity shall not affect the remaining provisions of tllis Resolution, which shall be construed or enforced as if such j1Jegal or invalid or inoperable provision were not contained herein. ]3. Certificates, etc. The Mayor, City Manager, City Clerk and other officers of . the City are tluthorized and directed to prepare and furnish to bond counsel and thc purchaser of the Note, when issued, certified copies of all proceedings and records of the City relating to tIle Note, and such other affidavits and cet<tificatcs as may be required to show the facts appearing from the books and records in the officers' custody and control or as otherwise known to them; and all such certified copies, certificates and affidavits, including and heretofore fumished, shall constitute representations of the City as to the truth of all statements contained therein. 14, Oualified Tax~Exempt Obligations. The Note is hereby designated as "qualified tax-exempt obligations" within the meaning of Section 265(b)(J) of the Internal Revenue Code of 1986, as amended. The Note is to be issued on behalf of an organization described in Section 501(c)(3) of the Code and is to be issued as "qualified 501(c)(3) bonds" under Section 145 of the Code. The City, together with al1 subordinate entities thereof, does not reasonably expect to issue tax-exempt obligations, including the Note (other than private activity bonds not constituting "qualified 501(c)(3) bonds"), which, \\'11en added together with all such obligations heretofore lssued by the City, or sLlch subordinate entities, in calendar year 2004, w111 be in an aggregate amount exceeding $10,000,000 in calendar year 2004. . \11.10'12117] ,11\ 5 AUT1IORILIN( i RlSOI\ 1I1UN . Adopted by the City Council of the City of Hopkins this 20th day of April, 2004. BY: Gene Maxwell, Mayor ATTEST: TelTY Obennaier, City Clerk . . \11 HI')::'1171 III 6 i\UTII()RIZI~:( i REst )(1 r "n~' . The motion for the adoption of the foregoing resolution was duly seconded by C ouncilmember and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: Whereupon said resolution was declared duly passed and adopted, and was signed by the Mayor and attested to by the City Clerlc . . ~II IO'J:21171.()] 7 Al~THOIU/]NCi I~FS()] IITION -. -- ... - - -- . ST A TE OF MINNESOTA ) ) SS. COUNTY OF HENNEPIN) L thc undersigned, being the duly qualified and acting City Clerk of the City of Hopkins, Minnesota (the "City"), do hereby certify that attached hereto IS a compared, true and correct copy of a resolution giving final approval to an issuance of revenue bonds by the City on behalf of The Church of S1. Joseph of Hopkins, a Minnesota parish corporation, duly adopted by the City Council of the City on April 20, 2004 at a regular meeting thereof duly called and held, as on file and ofrecord in my office, which resolution has not been amcnded, modified or rescinded since the date thereof, and is in full force and effect as of the date hereof, and that the attached Extract of Minutes as to the adoption of sLlch resol ution is a truc . and accurate account of the proceedings taken in passage thereof. WITNESS My hand and the official seal of the City this day of April, 2004. City Clerk (Seal) . \ 11, 111'J"lI71 III Al !IHORILI""Ci RESClI Illlt IN COpy F AEGRE & BENSON LLP COpy . 220() WELLS FARGO CENTER, l)() S()lITI-I SEVENTH STREET MIN:->IEAPOLlS, MINNESOTA 55402 390] TEI.F.PHONl 6 [2, 76Cl, 7000 FACSIMIU (l [2, nfl, [ClOD \v\vw. facgre Xl}lll STEF,\NIE N, IIAI H sgi.llt:y,{/'lal');Tc.L',)1l1 11 1 ~ 7MI_ 7(d~ I April 14,2004 City of Hopkins Attn: Jim Kerrigan 10[0 South First Street Hopkins, MN 55343 $2,400,000 City of Hopkins, Minnesota School Facility Revenue Note (The Church of St. Joseph of Hopkins Project) Series 2004 The City of Hopkins has been requested to give its approval to the issuance of an . approximately $2,400,000 School Facility Revenue Note (The Church of St. Joseph of Hopkins Project), Series 2004 (the "Note") for the purpose of financing the renovation of the school building owned by The Church of St. Joseph of Hopkins (the "BolTower") in the City, The Council is being requested to hold a public hearing as required by state and federal law, and to give its final approval to the issuance and sale ofthe Note at its meeting of April 20th. [ have revie\ved the documentation to be entered into by the City in connection with the issuance of the Note, and such documents clearly establish that the Note will be secured solely by payments made by the Borrower under its Loan Agreement with the City, and further that no City funds, revenues or taxes will be pledged or made available to pay the Note. By issuing the Note, the City will assist the Borrower by reducing its debt service costs with respect to its proposed bOlTowing. If you or any member of the Council have any questions regarding the Note, please feel free to call me. Sincerely, Stefanie N. Galey SNCi: me lbj . \ 11 IIILI~.jjj 111 Mill II esota Colonulo 1011'(/ LOlldoll Fmllkji/rt Shlll/gha; . CITY OF HOPKINS APPLICATION FOR PRlV ATE ACTIVITY REVENUE BOND FINANCING CITY OF HOPKINS 1010 FlRST STREET SOUTH HOPKINS, MN 55343 OFFICE USE ONLY' -/ Date Received:g~ oy Received by: ) Type of Request: (check one) Taxable Bond Issue ~ Tax-Exempt Bond Issue _ Refunding of Previous Bond Issue GENERAL APPLICANT INFORMATION 1. Applicant/business name: CAu/ti!./l () / J'I: ~~A- . Contact person (incl. telephone number): /J)t4 Ii!/ j/J-Ilr~ 95,1- 9:15- t! //1 Address: l..l/d ml}/A/c!TREET City: J! t11JhH'J' State: ;JJn- ZIP: s=O~.3 / Telephone: (work) C;S-,2- q3~-4//1 (home) 7&.:1-- s1L'~ - .32'10 FAX: '95.2- ~ .fS-~ ~:1 9 E-mail: Aj.Jh1JW/~7'k~-hM!~cff-J,pGS'J,ljJk)yrj. tPRj 2. Applicant's legal counsel: /}1G/E'~ L;g-/V/L!Jy-r tPtA/N# Contact person (incl. telephone number): tArJRkr 171. g J~hk~ 05J~c2?~- /9)/ Address: ~.~ cZl.1r1. tW'..@/A 4-~L J..,.;/t- 7:iw.t:e ~ /lJIH,yEcJ;~ Jt~f ~ City: S1: t9~uL State: /l1/Y' ZIP: 55'J~ l-o/J.!hl Telephone: (work) h~/"'-02:l!- /q / J (home) FAX: &51-c2~J- 5'/~3 E-mail: tb itAJeR (i;V I'mk1,l:Jw. & mL 3. Property owner(s) of record: !! A ui!.!,{ IJ ~ J;L~ ..'JdJ.6',fA- . 1 . tJ}1 f} J/v eff lU5Z f Address: /3J{) City: >>lJfJkiYJ State: /!JtV ZIP: ~SJ4tG' Telephone: (work) <150<- tj 3S-- d J J I (home) FAX: 95,2- 9JS--I"D.l4 E-mail: 4. Applicant's business form (corporation, partnership, sole proprietor-ship, etc.) and state of corporation or organization: ~ R;JdRiJh(/N - iY1 ;;'1''/ RCflJftJ 5. If the applicant is a corporation, list the officers, directors and stockholders holding more than 5% of the stock of the corporation. State their name, address, telephone number and relationship to the applicant.(lf a corporation is not formed, list the potential officers, directors and stockholders): 4#1 . 6. If the applicant is a partnership, list the general partners and any limited partners with more than 5% interest. (If the partnership is not formed, give as much data as possible concerning the potential partners): /'/ /If . 2 --- . . 7. List any cities to which the applicant has applied for taxable/tax exempt bond financing within the last five years:. /vIA 8. Has the applicant ever been in bankruptcy? If yes, please explain: #~ . 9. Has the applicant ever defaulted on any bond or mortgage commitment? If yes, please explain: tV/) PROJECT INFORMATION 1. Project name: 1J1/7.J/Y J7J2FFT Je/,(Jd! d I UJerl3t?tmAY?, IJ J2fr v 2. Project address: JiM IYIfJ JJld'TIJCET j-/o o.b;.;..:; tIf}#' CSS5"c3 '" 3. Applicant's interest in property ifnot O\Vller: & /IV ;y1;!i .e . 3 . 4. Brief description of the nature of the business, such as principal services or products, etc.: .f V€,9,e }d1 h cnk" I 0/ t/r4RfM St~L1 / 5. Amount of bond issue requested: $ ~ ~4 IJtJ(}, {uJ 6. Total proj ect cost: $ o? Wlrf; dtJJ. .dd 7. Expected term: /0 v€/7RJ' ./ 8. Estimated date of construction: /Y1A y I {) t.t Completion: A pl1/A/-/- 'dt..f- 9a. Project architect: C.lah d 711?IEtff. l.'phdfkrt /}RAhikt-# Address: 7SolJ Rlfi I2/cEr 'J}/l7ffE (;R/~ a E#' ~/"j21"'.E. prz.,.- S 9 'I'fE- 3 7f./y " b. General contractor: ~1'1r( a/~nL-h}J"'" 4m;f1IJiYY Address: .jqOtl JO-lh MIVt% tVJR/A b?t/~.y v?t/lfEy, /11:T 55'tC.,,{ '7 . BUSmESS INFORMATION l. Number of employees in Hopkins? . Full Time Part Time A. Before this project: B. After this project .;zs- 2. Is the project associated with an existing Hopkins business? A. Yes ~ B. No 3. Length of time in business: /!o-ah,vrl JtM~ I j)1'cr1R/~1 -r:I J-faJEJ 7 A.~%IL ,. ..:;C.\LJ..;If c:?/O 4. Will any public official of the City, directly or indirectly, to the best of your lmowledge, benefit by the issuance of the City's tax-exempt fmancing for this project according to Minnesota Statutes, Section 412.877 If so, please explain: ///0 . 4 . FlUNG REQUIREMENTS Return the following to the Planning & Economic Development Department. l. Completed application. 2. An application fee of $5,000. (Make your check out to the City of Hopkins,) This fee is not refundable and is separate from the Bond Counsel's, City Attorney's, and closing fees. 3. A public hearing notice and resolution of preliminary approval. 4. Executed letter of agreement. (If the project requires approval by the Zoning and Planning Commission, you must apply for these approvals prior to or with this application. ) GUIDELINES l. The project shall not require a significant amount of public money for City improvements if the City Council detennines that the site is premature for development. 2. The notes or bonds shall be for an issue not less than $250,000. . 3. Construction and subcontractors must begin within one year of preliminary approval. The City Council may grant a time extension if just cause is shown. 4. Contractors doing work on projects funded in whole or in part by tax-exempt financing: a, Shall not discriminate in the hiring and firing of employees on the basis of race, color, creed, religion, national origin, sex, marital status, age, disability or the need for public assistance. b, Shall pay employees as provided under the United States Code, Section 276A, as amended through June 23,1986, and under Minnesota Statutes 1985, Sections 177.41 -177.44. 5. Applicant must use the City's Bond Counsel. 6. The applicant must select a qualified financial adviser or underwriter to assist the applicant in preparing all necessary application documents and materials. The financial adviser will submit a letter that establishes the [mancial feasibility of the project. Applications may, in the alternative, include a signed letter form a responsible financial institution indicating that the project is economically feasible and viable and stating that bonds can be successfully sold for the project or that an individual or institution intends to purchase all of the bonds. 7. Commercial lindustrial projects must involve an existing business that the City wishes to expand or a new business which the City wishes to attract. 8. A housing project must provide housing opportunities that the City Council detennines are important for the community. . 5 . 9, The Council may in its sole discretion impose conditions exceeding those required under the City building and use codes and policies relating to exterior building material, landscaping, signage, lighting, and such other aspects as the Council may consider appropriate on a case-by-case basis. A new construction project or expansion of an existing project should attempt to include at least five of the following features into the project: a. Brick exterior b. Building design should be a distinctive, non-generic style, c. A noticeable increase in the size and quantity oflandscape plantings over what the City normally requires, d. Underground irrigation of all landscaping. e. Open space, other than required setbacks. f. At least lO% more parking than code requires. g. Walkway along street frontages. 10. The City is to be reimbursed and held harmless for and from any out-of-pocket expenses related to the tax exempt financing including, but not limited to, legal fees, [mancial analyst fees, and bond counsel fees. A non-refundable application fee in the amount of $5,000 must be included with the submission of the application. . ll. Applicant must pay an annual administrative fee to the City of one eighth of one percent of the outstanding principal balance of the bond issue. This will be paid semiannually while the bonds are outstanding at the times specified in the bond documents. 12. The Council may, in its sole discretion, withdraw its preliminary approval ofa project any time if in its judgment the purposes of the Act will not be served by going forward with the project and its financing. . 6 , . LETTER OF AGREEillNT This letter of agreement is given by (;IcURtk .rf ~ :J~/ra OJ f!4.upPr-h~d under the laws of Minnesota ("Applicant") as required by the City of Hopkins, MinneSota, in connection with its consideration of an application for tax exempt revenue bond fmancmg for the proj ect described as follows: Applicant agrees as follows: l. Applicant agrees to payor 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 State of Minnesota, whether or not revenue bond financing is fmally approved by the City, whether or not the bonds are issued and sold, and whether or not the proj eet 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 attorney's 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 hereby 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. 5. I certify that the information provided in the application contains no misrepresentations, omissions or concealments of material facts and that the information given is true and complete to the best of my knowledge. Dated: /1!~3( ~&? (Applicant) By /ll~r7~?-t H . JJ~~7;;v Its 7 , . Remodel of St. Joseph's School for Main Street School of Performing Arts St. Joseph's Hopkins was created in the early 1920's through the consolidation ofSt. Margaret's and St. Mary's. St. Joseph's currently serves 1050 households. In 1922 a school, church and social hall complex was built along with a convent and rectory. In 1953 a new church was built to accommodate the growth at St. Joseph's. At that time the original school, church and social hall complex was converted to all school space with additional classrooms added. A second classroom addition was completed in 1959, The current school has 16 classrooms, office space, media center, band room, gymnasium, cafeteria and teachers lounge. The total school complex is approximately 40,000 sq ft. With the deconsolidation of John Ireland School, our school building will be vacant except for limited parish use. Our intent is to lease our school building to a charter school, the Main Street School of Performing Arts (MSSP A). The MSSP A is cosponsored by the Hopkins ISD #270 and the Stages Theater with a fall 2004 opening date. To accomplish this we will be required to renovate our school at a cost of $2,400,000. . The renovation will include the following: 1) New heating, air conditioning and ventilation system. 2) Upgrade electrical system. 3) Alarm system. 4) Communication & data capabilities in each room. 5) Sprinkler system for building. 6) Two elevators. 7) Dance Studio & band room. 8) Computer room. 9) Science room, 10) Cafeteria remodel, 11) Office & conference room remodel. 12) Teachers lounge. .