Title
Resolution Approving and Authorizing (I) The Use of Unobligated Tax Increment under Temporary Tax Increment Financing Spending Plan Authority to Provide Infrastructure Improvements Necessary to Advance Private Development at The Heights, (II) Execution of Documents Relating Thereto, and (III) Approving an HRA Budget Amendment, District 2, Ward 6
Body
WHEREAS, Minnesota Statutes, Section 469.176, subdivision 4n, as amended (the “Temporary TIF Act”), authorizes the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the “HRA”) to, notwithstanding any other law to the contrary, spend unobligated tax increment (“Available Tax Increments”) to provide improvements, loans, interest rate subsidies, or assistance in any form to private development consisting of construction or substantial rehabilitation of buildings and ancillary facilities, if the following conditions exist:
(1) such assistance will create or retain jobs in the State of Minnesota (the “State”), including construction jobs;
(2) such construction commences before December 31, 2025;
(3) such construction would not have commenced before December 31, 2025 without such assistance;
(4) the HRA creates, and the City Council (the “Council”) of the City of Saint Paul, Minnesota (the “City”) approves, a written spending plan (after a duly noticed public hearing) that specifically authorizes the HRA to take such actions; and
(5) the Available Tax Increments are spent under the spending plan by December 31, 2025; and
WHEREAS, the HRA and the Council have heretofore adopted a spending plan on June 22, 2022 and adopted a Supplement to the Spending Plan on February 23, 2023 (collectively the “Spending Plan”) pursuant to the Temporary TIF Act, which authorizes the use of Available Tax Increments to provide improvements, loans or assistance for private development that satisfies the criteria listed above and as further described in the Spending Plan; and
WHEREAS, as authorized by and pursuant to the Spending Plan and the Temporary TIF Act, the HRA transferred unobligated tax increments to a separate holding account (the “HRA Spending Plan Account”) on or before December 31, 2022; and
WHEREAS, the Port Authority of the City of Saint Paul (the “Port Authority”) has heretofore established the Port Authority’s Hillcrest Industrial Development District located at 2200 Larpenteur Avenue East in the East Side neighborhood of the City, also known as “The Heights” (“The Heights”), and
WHEREAS, the HRA plans to spend up to $5,780,202 of Available Tax Increments from the HRA Spending Plan Account for the purposes of the construction and installation of roads, water, sewer, and other related public infrastructure (the “Infrastructure”) to support private development by Northern States Power Company, commonly referred to as “Xcel Energy” (the “Developer”), on land at The Heights (the “Land”) previously acquired by the Developer from the Port Authority, for the currently anticipated purpose, per the site plans submitted to the City by the Developer, including the construction of two buildings, consisting of (a) an approximately 341,500 square-foot service center building, including approximately 125,000 square feet for parking storage and circulation, and (b) an approximately 30,000 square-foot fleet building (together, the “Private Development”); and
WHEREAS, pursuant to Minnesota Statutes Section 471.59, as amended (the “Joint Powers Act”), the Port Authority and the HRA will enter into a joint powers agreement (the “Agreement”) in connection with the construction of the Infrastructure and to jointly or cooperatively exercise their common power of financing projects under the Temporary TIF Act; and
WHEREAS, pursuant to Resolution No. 09-09/23-1 (the “ENS Resolution”), the HRA adopted the Early Notification System (“ENS”) requiring the HRA to provide 45-days’ notice informing neighborhood organizations and concerned citizens of certain actions which may potentially impact the neighborhood and/or area residents, including a final determination by the Board of Commissioners of the HRA (the “Board”) to provide HRA financial assistance (including a loan, grant, loan guarantee, tax increment financing, tax credits or other HRA participation) in the amount of $250,000 or more; and
WHEREAS, City of Saint Paul Ordinance 19-39, passed July 17, 2019, containing a recital statement of commitment from the Port Authority that “no Tax Increment Financing (TIF) will be requested for infrastructure for the Project at any time”, is not directly applicable because the Port Authority is not requesting the HRA to establish a TIF district and the Available Tax Increments to be provided are derived from existing TIF districts in accordance with the Temporary TIF Act;
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota as follows:
Section 1. Findings. It is hereby found, determined and declared that:
1.01 The HRA is a body corporate and politic and a political subdivision of the State of Minnesota and is authorized under the Temporary TIF Act to spend Available Tax Increments for the Infrastructure because:
(i) the Infrastructure will enable the HRA and the Port Authority to provide assistance and improvements to the Developer’s Private Development, which consists of the construction and equipping of buildings and ancillary facilities;
(ii) the construction of the Private Development will commence before December 31, 2025, and would not commence before that date without the Infrastructure funded, in part, by the Available Tax Increments;
(iii) the Infrastructure and Private Development will create jobs in the State, including construction jobs;
(iv) the Available Tax Increments will be applied to reduce the cost of the Infrastructure supporting the Private Development. The Port Authority and the Developer have represented that the Developer will not proceed with the construction of the Private Development without the completion of the Infrastructure. The Port Authority and the Developer have further represented that, but for the Available Tax Increments assistance in the amount of $5,780,202, the Infrastructure and the Private Development, respectively, would not be economically feasible within the reasonably foreseeable future, and more specifically, construction of the Private Development would not commence before December 31, 2025; and
(v) the Available Tax Increments for the Infrastructure to assist the Private Development, will be spent under the Spending Plan by December 31, 2025.
1.02 The Board further finds that the Infrastructure meets the Spending Plan goal of providing assistance in any form to advance the private development (including the Private Development) of underutilized, privately owned redevelopment sites within the City and is authorized pursuant to the Spending Plan and the Temporary TIF Act.
1.03 The ENS Resolution allows the Commissioner of the ward wherein a project is located to shorten the 45-day ENS notice period based on a compelling reason to expedite the request for financial assistance.The Board hereby finds that meeting the Temporary TIF Act deadline to commence construction of the Private Development before December 31, 2025, is a compelling reason to expedite this Board’s approval of the use of the Available Tax Increments to provide financial assistance to the Port Authority and the Developer, as described herein.
Section 2. ENS Waiver. The Board, and specifically the Commissioner of Ward 6, the ward in which the Infrastructure and Private Development will be constructed, hereby waives the 45-day ENS notice requirement to expedite the use of the Available Tax Increments to offset a portion of the cost of the Infrastructure.
Section 3. Approval of the Use of Available Tax Increments. The Board hereby approves the use of the Available Tax Increments for the Infrastructure in a maximum amount of $5,780,202.
Section 4. Approval of Forms; Execution.
4.01 Subject to the approval of the St. Paul City Attorney Office, the HRA’s Executive Director and staff of the HRA and the HRA's advisors and legal counsel are authorized and directed to proceed with the implementation of this Resolution, including without limitation the transfer of Available Tax Increments to the Port Authority in connection with the construction of the Infrastructure and documentation of construction jobs in connection with the Infrastructure and the Private Development. The HRA’s Executive Director and staff of the HRA and the City and the HRA’s and City’s advisors and legal counsel are authorized and directed to negotiate, draft, prepare and execute all further plans, resolutions, documents, notes and contracts, necessary to accomplish these actions, including, but not limited to, the Agreement, any term sheet, certificate or document, in connection with the construction of the Infrastructure and pursuant to the Joint Powers Act (the “Documents”).
4.02 The Board hereby authorizes the Chair of the HRA (or any Commissioner), the Executive Director of the HRA, and the Director, Office of Financial Services of the City, or their proper designees (collectively, the “Authorized Officers”), to execute and deliver, on behalf of the HRA, the Documents, and to carry out, on behalf of the HRA, directly or through one or more appointed designees, the HRA’s obligations thereunder when all conditions precedent thereto have been satisfied. The HRA may execute the Documents by electronic signature. For purposes hereof: (i) “electronic signature” means a manually signed original signature that is then transmitted by electronic means; and (ii) “transmitted by electronic means” means sent in the form of a facsimile or sent via the internet as a portable document format (“pdf”) or other replicating image attached to an electronic mail or internet message; or (iii) a digital signature of an authorized representative of any party provided by AdobeSign or DocuSign (or such other digital signature provider as specified by such party). The execution of any instrument by an Authorized Officer shall be conclusive evidence of the approval of such document in accordance with the terms hereof. In the event of absence or disability of the Authorized Officers, the Documents may be executed without further act or authorization of the Board by any member of the Board or any duly designated acting official, or by such other officer or officers of the Board as approved by the St. Paul City Attorney Office, may act on their behalf.
4.03 The Board authorized authority to approve, execute and deliver future amendments to the Documents entered is hereby delegated to the Executive Director, subject to the following conditions: (a) such amendments or consents do not materially adversely affect the interests of the HRA; (b) such amendments or consents do not contravene or violate any policy of the HRA, and (c) such amendments or consents are acceptable in form and substance to the Saint Paul City Attorney to the HRA or counsel retained by the HRA to review such amendments. The authorization hereby given shall be further construed as authorization for the execution and delivery of such certificates and related items as may be required to demonstrate compliance with the agreements being amended and the terms of this Resolution.
Section 5. Approval of an HRA Budget Amendment. The Board hereby approves the HRA budget as set forth in the attached Financial Analysis.
Section 6. Adoption. This Resolution shall be in full force and effect from and after its passage.