V.1. Public Hearing Regarding an Educational Facility and Consenting to the Issuance of Revenue Obligations by the City of Columbus for the Benefit of The Blake School; BishopJanuary 31, 2022 Council Report 2022-012
PUBLIC HEARING REGARDING AN EDUCATIONAL FACILITY AND
CONSENTING TO THE ISSUANCE OF REVENUE OBLIGATIONS BY THE
CITY OF COLUMBUS FOR THE BENEFIT OF THE BLAKE SCHOOL
Proposed Action
Staff recommends that the Council approve the following motion: Move to adopt Resolution
2022-007 Consenting to and Approving the Issuance by the City of Columbus of its Revenue
Obligations for the Benefit of the Blake School and Taking Other Actions with Respect Thereto
Overview
Pursuant to Minnesota Statutes, Sections 469.152 through 469.1655, a municipality is authorized
to issue revenue bonds to attract or promote economically sound industry and commerce.
The Blake School intends to issue approximately $35 million of revenue bonds through the City
of Columbus. The bonds will refinance a portion of existing revenue bonds issued by Hopkins in
2017 and finance the construction of an early learning center in Hopkins. In order for the City of
Columbus to issue the revenue bonds under Minnesota Statute the Hopkins City Council must
hold a public hearing, grant host approval and consent to the refunding of the 2017 bond issue.
The bonds will be issued through the City of Columbus. The bonds will not be a general
obligation of the City of Hopkins and will not be secured by or payable from any assets or taxing
authority of the City of Hopkins.
The Blake School will pay the out-of-pocket expenses for the City of Hopkins related to the bond
issuance.
Julie Eddington from Kennedy & Graven, the City’s bond counsel and a representative from The
Blake School will be present for questions.
Supporting Information
•Letter from Kennedy & Graven
•Resolution No. 2022-007
________________________________________
Nick Bishop
Finance Director
Offices in
Minneapolis
Saint Paul
St. Cloud
Fifth Street Towers
150 South Fifth Street, Suite 700
Minneapolis, MN 55402
(612) 337-9300 telephone
(612) 337-9310 fax
kennedy-graven.com
Affirmative Action, Equal Opportunity Employer
JULIE A. EDDINGTON
Attorney at Law
Direct Dial (612) 337-9213
Email: jeddington@kennedy-graven.com
January 21, 2022
Nick Bishop, Finance Director
City of Hopkins
1010 First Street South
Hopkins, MN 55343
Re: Resolution providing host approval for facilities to be financed and refinanced with the proceeds of
revenue obligations to be issued by the City of Columbus
Dear Nick,
The Blake School, a Minnesota nonprofit corporation (the “Borrower”), operates educational facilities in the
City of Hopkins (the “City”), the City of Wayzata, and the City of Minneapolis. The Borrower has requested
that the City of Columbus issue one or more series of taxable or tax-exempt revenue notes (the “Notes”) in
the maximum principal amount of $35,000,000 and loan the proceeds thereof to the Borrower in order to
(i)refinance a portion of the Educational Facilities Revenue Refunding Note (The Blake School Project),
Series 2017 (the “Series 2017 Note”), issued by the City on December 14, 2017, in the original aggregate
principal amount of $13,833,000; and (ii) finance the construction of an early learning center (the
“Construction Project”) to be located at the Borrower’s educational facilities located at 110 Blake Road
South in the City (the “Hopkins Campus”). Proceeds of the Series 2017 Note were loaned to the Borrower
and used to refinance improvements to the Hopkins Campus and the Borrower’s educational facilities
located at 301 Peavey Lane, Wayzata, Minnesota (the “Wayzata Campus”). The Borrower has represented
to the City that it will use equity to prepay the portion of the Series 2017 Note used to refinance the
improvements to the Wayzata Campus.
In order for the City of Columbus to issue the Notes, the City must grant “host approval” to the issuance of
the Notes, following a duly noticed public hearing, under Minnesota Statutes, Sections 469.152 through
469.1655, as amended (the “Act”), Minnesota Statutes, Section 471.656, and the Internal Revenue Code of
1986, as amended (the “Code”). In addition, the City must consent to the refunding of the Series 2017 Note
by the City of Columbus pursuant to Section 469.155, subdivision 12 of the Act. Enclosed is a resolution for
consideration by the City Council on January 31, 2022, following the public hearing, which grants host
approval to the issuance of the Notes by the City of Columbus and also consents to the refinancing of the
City’s Series 2017 Note by the City of Columbus.
The Notes will be issued as conduit revenue obligations of the City of Columbus secured solely by the
revenues derived from the loan or other revenue agreements executed by the Borrower and from other
security provided by the Borrower. The Notes will not constitute a general or moral obligation of the City
and will not be secured by or payable from any property or assets of the City and will not be secured by any
taxing power of the City. The Notes will not be subject to any debt limitation imposed on the City and the
issuance of the Notes will not have any adverse impact on the credit rating of the City, even in the event that
the Borrower encounters financial difficulties with respect to the facilities to be financed and refinanced with
the proceeds of the Notes. The issuance of the Notes by the City of Columbus will not affect the City’s
ability to issue general obligation or conduit revenue bonds in calendar year 2022. Furthermore, the issuance
of the Notes by the City of Columbus will not affect the ability of the City to issue and designate bonds as
qualified tax-exempt obligations (or “bank qualified”) for purposes of Section 265(b)(3) of the Code.
The Borrower will pay the out-of-pocket expenses of the City with respect to this transaction.
I will attend the City Council meeting on January 31, 2022, and can answer any questions that may arise
during the meeting. Please contact me if you have questions regarding the foregoing.
KENNEDY & GRAVEN, CHARTERED
Julie Eddington
CITY OF HOPKINS, MINNESOTA
RESOLUTION NO. 2022-007
RESOLUTION CONSENTING TO AND APPROVING THE
ISSUANCE BY THE CITY OF COLUMBUS OF ITS REVENUE
OBLIGATIONS FOR THE BENEFIT OF THE BLAKE SCHOOL
AND TAKING OTHER ACTIONS WITH RESPECT THERETO
WHEREAS, the City of Hopkins, Minnesota (the “City”) is a home rule city and political
subdivision duly organized and existing under its Charter and the laws of the State of Minnesota; and
WHEREAS, pursuant to Minnesota Statutes, Sections 469.152 through 469.1655, as amended
(the “Act”), the City is authorized to carry out the public purposes described in the Act by providing for
the issuance of revenue bonds to provide funds to finance revenue-producing enterprises located within
the City, whether or not operated for profit, or to refund, in whole or in part, bonds previously issued
under the authority of the Act; and
WHEREAS, Minnesota Statutes, Section 471.656, as amended, authorizes a municipality to issue
obligations to finance or refinance the acquisition or improvement of property located outside of the
corporate boundaries of such municipality if the governing body of the city in which the property is
located consents by resolution to the issuance of such obligations; and
WHEREAS, The Blake School, a Minnesota nonprofit corporation (the “Borrower”), has
proposed that the City of Columbus, Minnesota (the “City of Columbus”) issue one or more series of
taxable or tax-exempt revenue obligations (the “Notes”) in an estimated principal amount not to exceed
$35,000,000, under the provisions of the Act and Minnesota Statutes, Section 471.656, as amended, and
loan the proceeds thereof to the Borrower to (i) refinance the Educational Facilities Revenue Refunding
Note (The Blake School Project), Series 2017 (the “Series 2017 Note”), issued by the City on
December 14, 2017, in the original aggregate principal amount of $13,833,000; and (ii) finance the
construction of an early learning center (the “Construction Project”) to be located at the Borrower’s
educational facilities located at 110 Blake Road South in the City (the “Hopkins Campus”); and
WHEREAS, proceeds of the Series 2017 Note were loaned to the Borrower and used to refinance
improvements to the Hopkins Campus and the Borrower’s educational facilities located at 301 Peavey
Lane, Wayzata, Minnesota (the “Wayzata Campus”); and
WHEREAS, Section 147(f) of the Internal Revenue Code of 1986, as amended (the “Code”), and
regulations promulgated thereunder require that prior to the issuance of the Bonds, the City Council of the
City (the “City Council”) consent to the issuance of the Bonds by the City of Columbus after conducting
a public hearing thereon preceded by publication of a notice of public hearing (in the form required by
Section 147(f) of the Code and applicable regulations) in a newspaper of general circulation within the
City at least seven (7) days prior to the public hearing date; and
WHEREAS, a notice of public hearing (the “Public Notice”) was published at least seven (7)
days before the regularly scheduled meeting of the City Council on the date hereof in the Sun Sailor, the
official newspaper of and a newspaper of general circulation in the City, with respect to the required
public hearing under Section 147(f) of the Code; and
2
WHEREAS, on the date hereof, the City Council conducted a public hearing at which a
reasonable opportunity was provided for interested individuals to express their views, both orally and in
writing, on the following: (i) consent to the issuance of the Bonds by the City of Columbus pursuant to
the requirements of Section 147(f) of the Code and the regulations promulgated thereunder; and
(ii)approval of the issuance of the Bonds by the City of Columbus to finance the Construction Project and
refinance the prior improvements to the Hopkins Campus (collectively, the “Note-Financed Projects”); and
WHEREAS, the Borrower has represented to the City that it will use equity to prepay the portion
of the Series 2017 Note used to refinance the improvements to the Wayzata Campus; and
WHEREAS, in accordance with Section 469.155, subdivision 12 of the Act, the City Council is
required to consent to the issuance of the Notes by the City of Columbus to refinance the Series 2017
Note; and
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
HOPKINS, MINNESOTA, AS FOLLOWS:
1.In accordance with Section 469.155, subdivision 12 of the Act and Minnesota Statutes,
Section 471.656, as amended, the City Council finds that it is in the best interest of the City to approve
the issuance of the Notes by the City of Columbus to refinance the Series 2017 Note and to finance and
refinance the Note-Financed Projects and hereby consents to the issuance of the Notes by the City of
Columbus for such purposes in an amount estimated not to exceed $35,000,000, subject to final approval
by the governing body of the City of Columbus, following the preparation of bond documents and a
determination by the City of Columbus to issue the Notes.
2.The Mayor and the City Manager are hereby authorized and directed to execute and deliver
any documents or certificates deemed necessary to fulfill the intentions of this resolution.
3. The Mayor and City Manager and other officers, employees, and agents of the City are
hereby authorized and directed to prepare and furnish to bond counsel and the original purchaser of the
Bonds certified copies of all proceedings and records of the City relating to the approval of the issuance
of the Bonds, including a certification of this resolution.
4. The Borrower will, upon demand, reimburse the City for costs paid or incurred by the
City in connection with this resolution.
5.This resolution shall be in full force and effect from and after its passage.
Approved by the City Council of the City of Hopkins, Minnesota this 31st day of January, 2022.
Patrick Hanlon, Mayor
ATTEST:
Amy Domeier, City Clerk