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Resolution Approving Bond Allocation Transfer Agreements and Related Documents, Citywide
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WHEREAS, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "HRA") is a public body corporate and politic established pursuant to the provisions of Minnesota Statutes, Section 469.001, et seq. (the “Act”); and
WHEREAS, the HRA has the power to engage in development or redevelopment activities under Minnesota law and the HRA is authorized to engage in activities relating to (a) housing projects and development, (b) removal and prevention of the spread of conditions of blight or deterioration, (c) bringing substandard buildings and improvements into compliance with public standards, (d) disposition of land for private redevelopment, and (e) improving the tax base and the financial stability of the community, and to engage in the aforementioned activities when these needs cannot be met through reliance solely upon private initiative and which can also be undertaken in targeted neighborhoods; and is authorized to create redevelopment projects as defined in Minn. Stat. Section 469.002, Subd. 14; and
WHEREAS, the pending federal tax reform legislation has created uncertainty as to whether the City of Saint Paul (“City”) and the HRA may issue tax-exempt private activity bonds after December 31, 2017; and
WHEREAS, such uncertainty has caused developers and other borrowers of tax-exempt private activity bond proceeds to request that the HRA accelerate the closing of several such bond issues on or before December 31, 2017; and
WHEREAS, and the City receives the federal allocation and then by ordinance designates the HRA to exercise the City’s powers and the current requests of the HRA to issue its tax-exempt private activity bonds on or before December 31, 2017 are more than the City’s 2017 entitlement allocation of private activity bond volume cap; and
WHEREAS, to address the shortage of private activity volume cap, the City and the HRA propose to enter into a Bond Allocation Transfer Agreement (“DCCDA Transfer Agreement”) with the Dakota County Community Development Agency (“Dakota County CDA”), whereby the Dakota County CDA would transfer to the City and the HRA approximately $18,299,773 of the Dakota County CDA’s 2017 entitlement allocation and 2016 carryforward of private activity bond volume cap (the “DCCDA Transferred Volume Cap”); and
WHEREAS, to further address the shortage of private activity volume cap, the City and the HRA propose to enter into a Bond Allocation Transfer Agreement (“MHFA Transfer Agreement” and, together with the DCCDA Transfer Agreement, the “Transfer Agreements”) with the Minnesota Housing Finance Agency (“MHFA”), whereby the MHFA would transfer to the City and the HRA approximately $282,147 of MHFA’s 2017 entitlement allocation of private activity bond volume cap (the “MHFA Transferred Volume Cap” and, together with the DCCDA Transferred Volume Cap, the “Transferred Volume Cap”); and
WHEREAS, to further address the shortage of private activity volume cap, the HRA has requested that MHFA issue its tax-exempt Rental Housing Bonds in 2017 to finance the Como by the Lake project in the approximate amount of $7,414,000 (the “Como Volume Cap”); and
WHEREAS, to further address the shortage of private activity volume cap, the City and the HRA have authorized entering into a Bond Allocation Transfer Agreement (“Minneapolis Transfer Agreement”) with the City of Minneapolis (“Minneapolis” and, together with MHFA and Dakota County CDA, the “Entitlement Issuers”), whereby Minneapolis would transfer to the City and the HRA approximately $18,098,203 of Minneapolis’s 2017 entitlement allocation of private activity bond volume cap (the “Minneapolis Transferred Volume Cap”); and
WHEREAS, at such time as the Dakota County CDA, the HRA and the City are advised by bond counsel that tax-exempt private activity bonds may be issued on and after January 1, 2018, the City and the HRA will transfer to the Dakota County CDA a portion of the City’s 2018 entitlement allocation of private activity bond volume cap in an amount equal to the DCCDA Transferred Volume Cap transferred to the City and the HRA under the DCCDA Transfer Agreement, provided that the City receives a 2018 entitlement allocation in an amount sufficient to return such amount plus all other amounts to be returned to any other Entitlement Issuers who have entered into transfer agreements with the City and the HRA, as further provided in the DCCDA Transfer Agreement; and
WHEREAS, at such time as MHFA, the HRA and the City are advised by bond counsel that tax-exempt private activity bonds may be issued on and after January 1, 2018, the City and the HRA will transfer to the MHFA a portion of the City’s 2018 or 2019 entitlement allocation of private activity bond volume cap in an amount equal to the MHFA Transferred Volume Cap transferred to the City and the HRA under the MHFA Transfer Agreement and will transfer a portion of the City’s 2019 entitlement allocation of private activity bond volume cap in an amount equal to the Como Volume Cap as further provided in the MHFA Transfer Agreement, provided that the City receives a 2018 and 2019 entitlement allocations in amounts sufficient to return such amounts plus all other amounts to be returned to any other Entitlement Issuers who have entered into transfer agreements with the City and the HRA, as further provided in the MHFA Transfer Agreement; and
WHEREAS Saint Paul City Council has been asked to approve the Transfer Agreements at its December 13, 2017 meeting; and
WHEREAS, by this resolution the HRA finds a public purpose for the actions taken by the HRA Board in this Resolution.
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the “HRA Board”) that:
1. The HRA Board hereby approves and authorizes the execution of the Transfer Agreements, or either of them, by the Chair/Commissioner, HRA Executive Director and Director, Office of Financial Services of the City, in substantially the forms submitted by staff together with any non-significant changes approved by the HRA Executive Director and City Attorney Office and for amounts of Transferred Volume Cap and Como Volume Cap to be determined by the HRA Executive Director and the applicable Entitlement Issuers.
2. The HRA Executive Director, staff and legal counsel for the HRA are further directed and authorized to take all actions necessary to implement this Resolution. The HRA’s Executive Director is authorized to execute any other documents and instruments in connection with this Resolution.