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Resolution Providing for the Transfer to the City of Saint Paul of the Portion of the Jimmy Lee Recreation Center, Financed by the Recreational Facility Lease Revenue Bonds, Series 2008 (Jimmy Lee Recreational Center) Previously Issued by the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota, the Defeasance of Such Bonds and Approving the Execution and Delivery of any Necessary Documents, District 8, Ward 1
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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 Sections 469.001 to 469.047, et seq. (the “Act”); and
WHEREAS, in 2008 the HRA issued its Recreational Facility Lease Revenue Bonds, Series 2008 Jimmy Lee Recreational Center (the “Series 2008 Bonds”), in the original aggregate principal amount of $7,685,000 with a final maturity date of December 1, 2032, pursuant to an Indenture of Trust, dated as of July 1, 2008 (the “Indenture”), between the HRA and U.S. Bank National Association, as trustee; and
WHEREAS, the proceeds of the Series 2008 Bonds were applied by the HRA to (i) finance the acquisition by the HRA of an undivided 42.5% interest (the “2008 Project”) of the Jimmy Lee Recreation Center (the “Jimmy Lee Recreation Center”) located at the intersection of Lexington Avenue and Marshall Avenue immediately south of Interstate 94; (ii) fund the reserve fund for the Series 2008 Bonds; and (iii) pay costs of issuance of the Series 2008 Bonds; and
WHEREAS, the Series 2008 Bonds are special, limited obligations of the HRA payable solely from the revenues pledged under the Indenture and such revenues are derived from payments to be made by the City of Saint Paul, a municipal corporation and political subdivision of the State of Minnesota (the “City”), pursuant to the terms of a Lease Agreement, dated as of July 1, 2008 (the “Lease”), between the HRA and the City; and
WHEREAS, the City desires to purchase the 2008 Project from the HRA and the City is proposing to issue general obligation capital improvement budget bonds in order to provide sufficient funds for the acquisition of the 2008 Project; and
WHEREAS, under the terms of the Lease, the City may acquire the 2008 Project through the payment of the option price in the Lease, which amount is equal to an amount required to repay the Series 2008 Bonds; and
WHEREAS, the City is proposing to pay the HRA an amount sufficient for the HRA to establish a defeasance escrow for the HRA’s Series 2008 Bonds (the “Escrow”); and
WHEREAS, the Director, Office of Financial Services, in consultation with Springsted, Inc., as municipal advisor, has recommended that the HRA defease the Series 2008 Bonds with funds provided by the City to acquire the 2008 Project under the terms of the Lease; and
WHEREAS, the City’s issuance of its general obligation capital improvement budget bonds and the establishment of the Escrow by the HRA to defease the Series 2008 Bonds is intended to lower the lease debt service costs of the City.
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the “Board”) that:
1. The use of the funds received from the City’s issuance of its general obligation capital improvement budget bonds in order to fund the Escrow and the City to exercise its purchase option in the Lease is hereby authorized and approved.
2. The Chair of the Board of Commissioners, the Director, Office of Financial Services and the Executive Director of the HRA, or their proper designees (collectively, the “Authorized HRA Officials”), are hereby authorized and directed to request that U.S. Bank National Association act as the escrow agent (the “Escrow Agent”) for the Series 2008 Bonds. The Authorized HRA Officials are authorized to enter into an escrow agreement (the “Escrow Agreement”) with the Escrow Agent to fund an escrow account for the redemption and prepayment of the HRA’s Series 2008 Bonds, to mail and electronically post the Notice of Call for Redemption and Notice of Defeasance with respect to the Series 2008 Bonds in substantially the form attached to the Escrow Agreement and to take all other necessary actions with respect to the establishment of the Escrow.
3. The Authorized HRA Officials are hereby authorized and directed to execute and deliver any documents, deeds, certificates, and instruments necessary in connection with such sale and conveyance to the City.
4. The Authorized HRA Officials, HRA staff and legal counsel for the HRA are further directed and authorized to take all actions necessary to implement this Resolution and the defeasance of the Series 2008 Bonds. The Authorized HRA Officials are authorized to execute and deliver any documents, certificates, and instruments necessary in connection with this Resolution to effectuate the defeasance of the Series 2008 Bonds.
5. The Authorized HRA Officials are authorized to subscribe for State and Local Government Securities issued by the United States Treasury (SLGS) or bid the funding of the Escrow with eligible United States Treasury Bonds and Notes.
6. The HRA hereby approves the HRA Budget Amendment as detailed in the attached Financial Analysis.