V.1. Public Hearing on the Approval of a Housing Program for a Multifamily Housing Development and the Issuance of Multifamily Housing Revenue Bonds for the Benefit of Alatus Hopkins LIHTC I LLC; Bishop
June 7, 2021 Council Report 2022-057
PUBLIC HEARING ON THE APPROVAL OF A HOUSING PROGRAM FOR A MULTI FAMILY
HOUSING DEVELOPMENT AND THE ISSUANCE OF MULTIFAMLY HOUSING REVENUE
BONDS FOR THE BENEFIT OF ALATUS HOPKINS LIHTC I LLC
Proposed Action
Open and Continue Public Hearing on the Approval of a Housing Program for a Multifamily Housing Development
and the Issuance of Multifamily Housing Revenue Bonds for the Benefit of Alatus Hopkins LIHTC I LLC
Overview
Pursuant to Minnesota Statutes, Sections 462C, as amended (the “Act”), a City is authorized to issue revenue bonds to
provide financing for multifamily rental housing developments. City Council is required to conduct a public hearing
on the issuance of the bonds.
Alatus has applied for and received authorization from Minnesota Management and Budget to issue up to
$24,927,542.75 of tax-exempt housing revenue bonds for the purpose of acquiring, constructing and equipping a 116-
unit multifamily rental housing facility located at 325 Blake Road for individuals and families of low and moderate
income. A public notice for this amount has been published in accordance with the Act. Alatus determined that, due to
increased costs, the principal amount of the bonds will need to be increased by approximately $5,000,000. Any amount
over $24,927,542.75 will be issued on a taxable basis. The new amount is a significant change from the public notice
and will require a new notice to be published and public hearing to be held on June 20th.
Following the public hearing on June 20th, City Council will be asked to approve a resolution which approves the
issuance of approximately $30 million of tax-exempt and taxable bonds, adopts a housing program and authorizes the
execution of loan documents.
The Bonds will not be an obligation of the City. They will not be secured by or payable from any property, assets or
taxing power of the city. They are secured solely by the revenues and other security provided by Alatus Hopkins
LIHTC I LLC. The bonds are not subject to any debt limitations imposed on the City and will not have any adverse
impact on the City’s credit rating, even in the event of financial difficulties of Alatus Hopkins LIHTC I LLC.
Julie Eddington from Kennedy & Graven, the City’s bond counsel and a representative from Alatus will be present on
June 7th for any questions.
Supporting Information
• Letter from Kennedy & Graven
____________________________________
Nick Bishop, CPA
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
www.kennedy-graven.com
Affirmative Action, Equal Opportunity Employer
JULIE A. EDDINGTON
Attorney at Law
Direct Dial (612) 337-9213 Email: jeddington@kennedy-graven.com
June 2, 2022
Nick Bishop, Finance Director
City of Hopkins
1010 First Street South
Hopkins, MN 55343
Re: City Council meeting on June 7 regarding the issuance of housing bonds for the benefit of Alatus
Hopkins LIHTC I LLC
Dear Nick,
Alatus Hopkins LIHTC I LLC, a Minnesota limited liability company (the “Borrower”), has proposed to
acquire, construct, and equip an approximately 116-unit multifamily rental housing facility and facilities
functionally related and subordinate thereto located at 325 Blake Road in the City of Hopkins (the “City”)
for occupancy by individuals and families of low and moderate income (the “Project”), which will be
owned and operated by the Borrower. To provide financing for the Project, the Borrower has requested
that the City issue one or more series of taxable and tax-exempt revenue obligations (the “Bonds”) and
loan the proceeds thereof to the Borrower.
The public hearing required by the Internal Revenue Code of 1986, as amended (the “Code”), and
Minnesota Statutes, Chapter 462C, as amended (the “Housing Act”), was originally scheduled to occur
during the City Council’s meeting on Tuesday, June 7, 2022, and notice was published in accordance with
the requirements of the Code and the Housing Act. The housing program prepared in accordance with the
requirements of the Housing Act was also submitted to Metropolitan Council for review and comment.
The public hearing notice and housing program indicated that the Bonds would be issued in an estimated
principal amount not to exceed $24,927,542.75, which is the amount of bonding authority that the City
was awarded by the State of Minnesota earlier this year.
However, the Borrower and the lender have determined that, due to increased expected costs of the
Project, the principal amount of the Bonds will need to be increased by approximately $5,000,000. The
additional principal amount of the Bonds must be issued on a taxable basis. The significant increase in
principal amount of the Bonds requires the parties to publish a new public hearing notice, and notice must
be published in newspaper of general circulation in the City at least 15 days prior to the date of the public
hearing. The Borrower has requested that the City Council conduct a public hearing on
Monday, June 20, 2022, to approve the issuance of taxable Bonds.
To simplify the process, the parties have proposed that the City Council open the public hearing originally
scheduled for Tuesday, June 7, 2022, and continue the public hearing until Monday, June 20, 2022. At
that time, the City Council will conduct one public hearing and consider a resolution approving the
issuance of the Bonds (both the taxable bonds and tax-exempt bonds) in the aggregate principal amount
estimated not to exceed $30,000,000 and adopting a housing program to satisfy the requirements of the
Housing Act.
Please contact me with any questions you may have.
Sincerely,
Julie A. Eddington
HP110-108 (JAE)
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