Loading...
CR 2014-027 Approve Resolution 2014-014, Providing Hose Approval to the Issuance of a Revenue Obligation by the City of New Hope for the Benefit of Homeward Bound, Inc.loco March 18, 2014 Council Report 2014-027 City of Hopkins RESOLUTION PROVIDING HOST APPROVAL TO THE ISSUANCE OF A REVENUE OBLIGATION BY THE CITY OF NEW HOPE FOR THE BENEFIT OF HOMEWARD BOUND, INC. Proaosed Action Staff recommends approval of the following motion: Approve resolution No. 2014-014 consentingto o and approving the issuance by the City of New Hope, Minnesota of Revenue Obligations to finance a project under Minnesota Statutes, sections 469.152 through 469 1655 as amended,• approving and authorizing the execution of a cooperative aereement; and approving and authorizine certain actions related thereto. Overview Homeward Bound, Inc. with locations in 10 cities is working with the City of New Hope to sell private activity bonds for the purpose of refinancing one or more loans made to finance their properties, one of which is located at 305 Althea Lane in Hopkins to also finance the acquisition, construction and equipping of new housing in Golden Valley. The IRS Code of 1986 mandates that the City Council of the City hold a public hearing on the approval of the issuance of the Note and a co-operative agreement to be entered into with the other cities in which a portion of the Project is located. On February 2, 2014 the City of Hopkins adopted a resolution appointing Hennepin County as agent responsible for conducting the public hearing. The attached resolution (i) approves the issuance of the Note by the City of New Hope to refinance a facility located within the City; and (ii) authorizes the execution and delivery of the Cooperative Agreement by the officials of the City. See attached memo from Julie Eddington of Kennedy & Graven for complete details. Primary Issues to Consider There are no issues regarding this action. Supportine Information • Resolution No. 2014-014 • Memo from Julie Eddington, Kennedy & Graven • Co-operative Agreement Christine M. Harkess, CPA, CGFM Finance Director Financial Impact: $ none Budgeted: Y/N Source: Related Documents (CIP, ERP, etc.): Notes: adopted a resolution appointing Hennepin County, Minnesota (the "County") as the agent responsible for conducting the public hearing. On March 18, 2014, the Public Works, Energy & Environment Committee of the County Board conducted a duly noticed public hearing at which residents of the Participant Cities were provided the opportunity to be heard. The attached resolution (i) approves the issuance of the Note by the City of New Hope to refinance a facility located within the City; and (ii) authorizes the execution and delivery of the Cooperative Agreement by the officials of the City. Please contact me at your convenience with any questions regarding the foregoing. KENNEDY & GRAVEN, CHARTERED Julie Eddington 440680vl JAE NE395-1 follows: CITY OF HOPKINS, MINNESOTA RESOLUTION NO. 2014-014 RESOLUTION CONSENTING TO AND APPROVING THE ISSUANCE BY THE CITY OF NEW HOPE, MINNESOTA OF REVENUE OBLIGATIONS TO FINANCE A PROJECT UNDER MINNESOTA STATUTES, SECTIONS 469.152 THROUGH 469.1655, AS AMENDED; APPROVING AND AUTHORIZING THE EXECUTION OF A COOPERATIVE AGREEMENT; AND APPROVING AND AUTHORIZING CERTAIN ACTIONS RELATED THERETO BE IT RESOLVED by the City Council of the City of Hopkins. Minnesota (the "City"), as Section 1. Background. 1.01. Statutory Authorization. The City is authorized by Minnesota Statutes, Sections 469.152 through 469.1655, as amended (the "Act'), to issue revenue obligations to finance, in whole or in part, the cost of the acquisition, construction, reconstruction, improvement, betterment, or extension of a "project," defined in the Act, in part. as any properties. real or personal, used or useful in connection with a revenue producing enterprise, or any combination of two or more such enterprises engaged in any business. 1.02. The Project. Homeward Bound, Inc., a Minnesota nonprofit corporation (the `Borrower"), owns and operates the following housing and care facilities for the disabled located at 4300 Lake Drive, Robbinsdale, Minnesota; 3300 Fountain Lane, Plymouth, Minnesota; 315 Saratoga Lane North, Plymouth, Minnesota; 13522 Sunset Trail, Plymouth, Minnesota; 305 Althea Lane, Hopkins, Minnesota; 4213 Zealand Avenue North, New Hope, Minnesota; 3009 Atwood Avenue, Minnetonka, Minnesota; 4025 Jersey Avenue North, Crystal, Minnesota; 3535 June Avenue North, Crystal, Minnesota; 5720 43rd Avenue North, Crystal, Minnesota; 3529 Lee Avenue North, Crystal, Minnesota; 6809 36°i Avenue North, Crystal, Minnesota; 4155 Webster Avenue South, St. Louis Park, Minnesota; 6452 Bluebird Circle, Maple Grove, Minnesota; 6769 East Fish Lake Road, Maple Grove, Minnesota; 7324 Noble Court, Brooklyn Park, Minnesota; 7839 Brooklyn Boulevard, Brooklyn Park, Minnesota; 1629 Independence Avenue North, Golden Valley, Minnesota (the "Existing Facilities"). The Borrower has determined to (i) refinance one or more loans made to finance the Borrower's Existing Facilities; and (ii) finance the acquisition, construction, and equipping of a new housing and care facility to be located at 6615 Medicine Lake Road in Golden Valley, Minnesota (the "New Facility." and collectively with the Existing Facilities, the "Project'). 1.03. The Note. The Borrower has requested that the City of New Hope, Minnesota (the "City of New Hope") issue its Revenue Note (Homeward Bound Project), Series 2014 (the "Note"), in one or more series, in the aggregate principal amount not to exceed $3,400,000, and loan the proceeds derived from the sale of the Note to the Borrower (i) to finance the Project; and (ii) to pay the costs of issuance of the Note. The Note is proposed to be purchased by Bremer Bank, National Association, a national banking association (the "Lender"). 1.04. Joint Powers Authority. (a) Pursuant to Minnesota Statutes, Section 471.656, as amended, a city may issue obligations to finance the acquisition or improvement of property located outside of the corporate 440669v1 JAENE395-1 boundaries of such city if the obligations are issued under a joint powers agreement in which one or more of the parties to the joint powers agreement issue such obligations and the property is located entirely within the boundaries of one or more of the parties to the joint powers agreement. (b) Pursuant to Minnesota Statutes, Section 471.59, as amended, by the terms of a joint powers agreement entered into through action of their governing bodies, two or more cities may jointly or cooperatively exercise any power common to the contracting parties or any similar powers, including those which are the same except for the territorial limits within which they may be exercised and the joint powers agreement may provide for the exercise of such powers by one or more of the participating governmental units on behalf of the other participating units. (c) The Cities of Golden Valley, Crystal, Robbinsdale, Plymouth, Hopkins, Minnetonka, St. Louis Park, Maple Grove, and Brooklyn Park, Minnesota (the "Participant Cities") and the City of New Hope are all authorized by the Act to issue revenue obligations to finance the Project. The City of New Hope and the Participant Cities are proposing to enter into a Cooperative Agreement, to be dated on or after April 1, 2014 (the "Cooperative Agreement"), pursuant to which the Participant Cities, as host cities, will consent to the issuance of revenue obligations and the financing of the Project by the City of New Hope, and the City of New Hope will agree to issue such revenue obligations to finance the Project located in the Participant Cities. 1.05. Public Hearing. The City appointed Hennepin County, Minnesota (the "County") as the agent responsible for conducting a public hearing, in accordance with Section 5f.103 -2(d) of the Internal Revenue Code of 1986, as amended (the "Code"). On March 18, 2014, the Public Works, Energy & Environment Committee of the Board of Commissioners of the County conducted a public hearing (the "Public Hearing") on the Project and the issuance of the Note by the City of New Hope, notice of which (the "Public Notice") was published as required by Section 469.154, subdivision 4 of the Act, and Section 147(f) of the Code. The Public Notice provided a general, functional description of the Project, as well as the maximum aggregate face amount of the obligations to be issued for the purposes referenced above, the owner of the Project, and the locations of the Project. The Public Notice was published in Finance & Commerce, the official newspaper of the County, in the Sun -Sailor, the official newspaper of the City and a newspaper of general circulation in the City, and in the Star Tribune, a newspaper of general circulation in the City, on a date at least fourteen (14) days before the meeting of the Public Works, Energy & Environment Committee on March 18, 2014. During the Public Hearing, a reasonable opportunity was provided for interested individuals to express their views, both orally and in writing, on the Project and the proposed issuance of the Note by the City of New Hope. Section 2. Approval of the Issuance of the Note by the City of New Hope. (a) The City hereby approves and authorizes the issuance by the City of New Hope of its Note to finance the Project. The Note will be issued under the terms of a resolution adopted by the City Council of City of New Hope on March 10, 2014. The aggregate principal amount of the Note is presently estimated not to exceed $3,400,000. Proceeds of the Note will be used to finance the Project and pay the costs of issuance of the Note. (b) The proceeds derived from the sale of the Note will be loaned by the City of New Hope to the Borrower pursuant to the terms of a Loan Agreement, to be dated on or after April 1, 2014 (the "Loan Agreement"), between the City of New Hope and the Borrower, and will be disbursed pursuant to the Loan Agreement. (c) The Note is to be issued pursuant to authority conferred by the Act. The Note will constitute an obligation secured solely by revenues derived from the operation of the Project and other 440669v1 JAE NE395-1 security provided by the Borrower. The Note will neither constitute a general or moral obligation of the City of New Hope, the Participant Cities, or the County nor be secured by any taxing power of the City of New Hope, the Participant Cities, or the County. (d) The City has detennined that it is desirable, feasible, and consistent with the objectives and purposes of the Act, and it is in the best interest of the City, to approve the issuance of the Note by the City of New Hope to provide financing for the Project and payment of costs of issuance of the Note. Section 3. Cooperative Agreement. The Mayor and the City Manager, or their designees (together, the "City Officials"). are hereby authorized and directed to execute the Cooperative Agreement, and when executed and delivered as authorized herein, the Cooperative Agreement shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Cooperative Agreement shall be substantially in the form on file with the City on the date hereof, which is hereby approved, with such necessary variations, omissions, and insertions as are not materially inconsistent with such forns and as the City Officials, in their discretion, shall determine; provided that the execution thereof by the City Officials shall be conclusive evidence of such determination. Section 4. Documents Furnished to Bond Counsel. The City Officials and other officers, employees, and agents of the City are hereby authorized and directed to prepare and furnish to bond counsel and the Lender certified copies of all proceedings and records of the City relating to the approval of the issuance of the Note, including a certification of this resolution. Such officers, employees, and agents are hereby authorized to execute and deliver, on behalf of the City, all other certificates, instruments, and other written documents that may be requested by bond counsel, the Lender, or other persons or entities in conjunction with the issuance of the Note. Without imposing any limitation on the scope of the preceding sentence, such officers, employees, and agents are specifically authorized to execute and deliver a general certificate of the City. Section 5. Costs. The Borrower will, upon demand, reimburse the City for costs paid or incurred by the City in connection with this resolution and the Cooperative Agreement. Section 6. Effective Date. This resolution shall be in full force and effect from and after its approval. Approved by the City Council of the City of Hopkins, Minnesota this 18`x' day of March, 2014. Eugene J. Maxwell, Mayor ATTEST: Kristine A. Luedke, City Clerk 440669vl JAE NE395-1 Second Draft March 11, 2014 COOPERATIVE AGREEMENT THIS COOPERATIVE AGREEMENT, dated as of April 1, 2014 (the "Cooperative Agreement"), is made and entered into between the CITY OF GOLDEN VALLEY, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Golden Valley"), the CITY OF CRYSTAL, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Crystal"), the CITY OF ROBBINSDALE, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Robbinsdale"), the CITY OF PLYMOUTH, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Plymouth"), the CITY OF HOPKINS, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Hopkins"), the CITY OF MINNETONKA, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Minnetonka"), the CITY OF ST. LOUIS PARK, MINNESOTA, a political subdivision of the State of Minnesota (the "City of St. Louis Park"), the CITY OF MAPLE GROVE, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Maple Grove"), the CITY OF BROOKLYN PARK, MINNESOTA, a political subdivision of the State of Minnesota (the "City of Brooklyn Park," and collectively with the City of Golden Valley, the City of Crystal, the City of Robbinsdale, the City of Plymouth, the City of Hopkins, the City of Minnetonka, the City of St. Louis Park, and the City of Maple Grove, the "Participant Cities"), and the CITY OF NEW HOPE, MINNESOTA, a political subdivision of the State of Minnesota (the "Issuer City"). RECITALS WHEREAS, Homeward Bound, Inc., a Minnesota nonprofit corporation (the "Borrower"), has proposed that the Issuer City issue one or more series of revenue obligations to (i) refinance one or more loans made to finance the Borrower's existing housing and care facilities for the disabled located at 4300 Lake Drive, Robbinsdale, Minnesota; 3300 Fountain Lane, Plymouth, Minnesota; 315 Saratoga Lane North, Plymouth, Minnesota; 13522 Sunset Trail, Plymouth, Minnesota; 305 Althea Lane, Hopkins, Minnesota; 4213 Zealand Avenue North, New Hope, Minnesota; 3009 Atwood Avenue, Minnetonka, Minnesota; 4025 Jersey Avenue North, Crystal, Minnesota; 3535 June Avenue North, Crystal, Minnesota; 5720 43rd Avenue North, Crystal, Minnesota; 3529 Lee Avenue North, Crystal, Minnesota; 6809 36h Avenue North, Crystal, Minnesota; 4155 Webster Avenue South, St. Louis Park, Minnesota; 6452 Bluebird Circle, Maple Grove, Minnesota; 6769 East Fish Lake Road, Maple Grove, Minnesota; 7324 Noble Court, Brooklyn Park, Minnesota; 7839 Brooklyn Boulevard, Brooklyn Park, Minnesota; and 1629 Independence Avenue North, Golden Valley, Minnesota (the "Existing Facilities"); and (ii) finance the acquisition, construction, and equipping of a new housing and care facility to be located at 6615 Medicine Lake Road in Golden Valley, Minnesota (the "New Facility," and collectively with the Existing Facilities, the "Project"); and WHEREAS, pursuant to Minnesota Statutes, Section 471.656, as amended, a municipality may issue obligations to finance the acquisition or improvement of property located outside of the corporate boundaries of such municipality if the obligations are issued under a joint powers agreement in which one or more of the parties to the joint powers agreement issue such obligations and the property is located entirely within the boundaries of one or more of the parties to the joint powers agreement; and 438809v2 JAE NE395-1 WHEREAS, pursuant to Minnesota Statutes, Section 471.59, as amended, by the terms of a joint powers agreement entered into through action of their governing bodies, two or more municipalities may jointly or cooperatively exercise any power common to the contracting parties or any similar powers, including those which are the same except for the territorial limits within which they may be exercised, and the joint powers agreement may provide for the exercise of such powers by one or more of the participating governmental units on behalf of the other participating units; and WHEREAS, the Participant Cities and the Issuer City are authorized by Minnesota Statutes, Sections 469.152 through 469.1655, as amended (the "Act"'), to issue revenue obligations to finance the acquisition, construction, reconstruction, improvement, betterment, or extension of a "project," defined in the Act, in part, as any properties, real or personal, used or useful in connection with a revenue producing enterprise, or any combination of two or more such enterprises engaged in any business; and WHEREAS, the Participant Cities and the Issuer City are proposing to enter into this Cooperative Agreement pursuant to which the Participant Cities will consent to the issuance of such revenue obligations and the financing of the Project by the Issuer City, and the Issuer City will agree to issue such revenue obligations to finance the Project; and WHEREAS, the revenue obligations proposed to be issued by the Issuer City for the benefit of the Borrower shall not constitute general or moral obligations of, or pledge the full faith and credit or taxing powers of, the Participant Cities, the Issuer City. Hennepin County. Minnesota (the "County"), the State of Minnesota (the -State"). or any other agency or political subdivision thereof, but shall be payable solely from the revenues pledged and assigned thereto pursuant to one or more agreements between the Issuer City and the Borrower; and WHEREAS, the governing bodies of the Participant Cities and the governing body of the Issuer City have authorized the execution and delivery of this Cooperative Agreement; and NOW, THEREFORE, the Participant Cities and the Issuer City hereby agree as follows: 1. The Issuer City shall issue its Revenue Note (Homeward Bound Project), Series 2014 (the "Note"), in one or more series, in the original aggregate principal amount of $3.400,000. The Note will be issued under the terms of a resolution adopted by the City Council of the Issuer City on March 10, 2014 (the "Resolution*'). Proceeds of the Note will be used to (i) finance the Project; and (ii) pay costs of issuance of the Note. 2. On March 10, 2014, the City Council of the Issuer City conducted a public hearing with respect to the Project. Pursuant to Section 5f.103 -2(d) of the Internal Revenue Code of 1986, as amended (the "Code"), on March 18. 2014. the Public Works. Energy & Environment Committee of the Board of Commissioners of Hennepin County. Minnesota (the "County"). as the appointed agent of the Participant Cities, conducted a public hearing on behalf of the Participant Cities with respect to the Project. 3. The Participant Cities and the Issuer City have all adopted a resolution approving this Cooperative Agreement and authorizing its execution and delivery. 4. The Participant Cities hereby consent to and approve: (a) the issuance of the Note by the Issuer City; and (b) the financing of the Project by the Issuer City with the proceeds of the Note to be issued by the Issuer City. 438809v2 JAE NE395-1 5. Except to the extent specifically provided herein, the Participant Cities and the Issuer City shall not incur any obligations or liabilities to each other as a result of the issuance of the Note. The Note shall be a special, limited obligation of the Issuer City payable solely from proceeds, revenues, and other amounts specifically pledged to the payment of the Note. The Note and the interest thereon shall not constitute or give rise to a pecuniary liability, general or moral obligation, or a pledge of the full faith and credit or taxing powers of the Participant Cities, the Issuer City, the County, the State, or any political subdivision of the above, within the meaning of any constitutional or statutory provisions. 6. All costs incurred by the Participant Cities and the Issuer City in the authorization, execution, delivery, and performance of this Cooperative Agreement and all related transactions shall be paid by the Borrower. 7. This Cooperative Agreement may not be tenninated by any party so long as the Note is outstanding. 8 This Cooperative Agreement may be amended by the Participant Cities and the Issuer City at any time. No amendment may impair the rights of the Borrower or the holder of the Note. 9. This Cooperative Agreement may be executed in several counterparts, each of which shall be regarded as an original and all of which shall constitute but one and the same agreement. (The remainder of this page is intentionally left blank.) 438809v2 JAE NE395-1 IN WITNESS WHEREOF, duly authorized officers of the Participant Cities and the Issuer City have executed this Cooperative Agreement as of the date and year first written above. CITY OF GOLDEN VALLEY, MINNESOTA, as a Participant City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 S-1 Execution page of the City of Crystal, as a Participant City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF CRYSTAL, MINNESOTA, as a Participant City IL0 Its Mayor By Its City Manager 438809v2 JAE NE395-1 S-2 Execution page of the City of Robbinsdale, as a Participant City. to the Cooperative Agreement, dated as of the date and year first written above. CITY OF ROBBINSDALE, MINNESOTA, as a Participant City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 S_3 Execution page of the City of Plymouth, as a Participant City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF PLYMOUTH, MINNESOTA, as a Participant City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 S-4 Execution page of the City of Hopkins, as a Participant City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF HOPKINS, MINNESOTA, as a Participant City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 $_5 Execution page of the City of Minnetonka, as a Participant City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF MINNETONKA, MINNESOTA, as a Participant City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 S_( Execution page of the City of St. Louis Park, as a Participant City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF ST. LOUIS PARK, MINNESOTA, as a Participant City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 S_7 Execution page of the City of Maple Grove, as a Participant City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF MAPLE GROVE, MINNESOTA, as a Participant City By Its Mayor By Its City Administrator 438809v2 JAE NE395-1 S_8 Execution page of the City of Brooklyn Park, as a Participant City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF BROOKLYN PARK, MINNESOTA, as a Participant City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 S-9 Execution page of the City of New Hope, as Issuer City, to the Cooperative Agreement, dated as of the date and year first written above. CITY OF NEW HOPE, MINNESOTA, as Issuer City By Its Mayor By Its City Manager 438809v2 JAE NE395-1 S-10