8.1. SR 09-06-2011REQUEST FOR ACTION
TO ITEM NUMBER
Ma or & Ci Council
AGENDA SECTION MEETING DATE PREPARED BY
Administration Se tember 6, 2011 Tim Simon, Finance Director
ITEM DESCRIPTION REVIEWED By
Resolution Calling for a Public Hearing on the Issuance of Robert Thistle, Interim City
Revenue Bonds and Ratifying the Publication of a Notice of Administrator
Hearing (Guardian Angel Project) REVIEWED BY
ACTION REQUESTED
The City Council is asked to adopt a resolution calling for a public hearing on the issuance of revenue
bonds and ratifying the publication of a notice of hearing (Guardian Angel project).
BACKGROUND/DISCUSSION
On August 12, 2011, Evans Park Inc. made application to the City for conduit bonding for approximately
$3.8 million for the acquisition, construction, and equipping of a 30-unit memory care addition and
certain other capital improvements to the existing 60-unit assisted living facility. In 1998, the City issued
conduit bonding to build the 60-unit assisted living facility. As a result, the applicant is very familiar with
the conduit bonding process.
Adoption of the attached resolution will allow for a public hearing to be held on September 19, 2011 at or
after 6:30 p.m. to consider the City to authorize the issuance of revenue bonds. These bonds will be
special, limited obligation of the City, and no holder of any bond will ever have the right to compel any
exercise of the taxing power of the City to pay the Bonds or the interest. Most recently the City has
issued conduit bonding for the following projects: Dove Tree Apartments (2010), Metal Craft (2008), and
Birchwood Apartments (2007).
FINANCIAL IMPACT
It is important to reemphasize that there will be no impact to the City, since this request is for a revenue
bond (conduit financing), with the City not having to pledge any considerations for its debt payment. In
addition, Guardian Angels of Elk River has paid an initial $5,000 application fee. Consistent with the
City's Conduit Bonding Policy, the City will also require one percent of the issuance amount of the bonds
be paid at closing to the City's Development Fund, and all out-of-pocket expenses for legal fees to
underwrite the bond will be paid by the applicant.
ATTACHMENTS
• Resolution calling for a public hearing on the issuance of revenue bonds and ratifying the
publication of a notice of hearing (Guardian Angel project)
• Notice of public hearing
Action Motion by Second by Vote
N:\Public Bodies\Ciry Council\Council RCA\Agenda Packet\09-06-2011\GuardianAngleconduitbonds[1].doc
Follow Up
N:\Public Bodies\City Council\Council RCA\Agenda Packet\09-06-2011\Guardiantingleconduitbonds[1].doc
EXTRACT OF MINUTES OF A MEETING OF THE
CITY COUNCIL OF THE
ELK RIVER, MINNESOTA
Pursuant to due call and notice thereof, a regular or special meeting of the City Council of the City
of Elk River, Minnesota, was duly held in the City Hall in said City on Tuesday, September 6, 2011,
commencing at approximately 5:30 P.M.
The following Councilmembers were present:
and the following were absent:
Member introduced the following resolution and moved its adoption:
RESOLUTION NO. I I -
RESOLUTION CALLING FOR A PUBLIC HEARING ON
THE ISSUANCE OF REVENUE BONDS AND
RATIFYING THE PUBLICATION OF A NOTICE OF HEARING
(GUARDIAN ANGEL PROJECT)
WHEREAS, under the Minnesota Housing Act, Minnesota Statutes, Chapter 462C, as
amended (the "Housing Act"), any statutory or home rule charter city may issue revenue bonds or
obligations to make a loan to finance a multifamily housing development, including the preparation and
construction of a new development and the improvement of an existing building and site by a nonprofit
corporation which will operate the building as a multifamily housing development for rental primarily to
elderly or disabled persons; and
WHEREAS, the Housing Act also provides that a multifamily housing development may
consist of a combination of a multifamily housing development and a new or existing health care facility
if: (i) the multifamily housing development is designed and intended to be used for rental occupancy;
(ii) the multifamily housing development is designed and intended to be used primarily by elderly or
physically disabled persons; and (iii) nursing, medical, personal care, and other health-related assisted living
services are available on a 24-hour basis in the multifamily housing development to the residents; and
WHEREAS, in the making of a multifamily housing development loan and the issuance of
revenue bonds or other obligations under the Housing Act, a city may exercise within its corporate limits
any of the powers the Minnesota Housing Finance Agency may exercise under the terms of the Housing
Finance Agency Act, Minnesota Statutes, Chapter 462A, as amended; and
WHEREAS, the City of Elk River, Minnesota (the "City"), has received from Evans Park,
Inc., a Minnesota nonprofit corporation and 501(c)(3) organization (the "Borrower"), a proposal that the
City undertake a program to assist in financing a Project hereinafter described, through the issuance of
revenue bonds or obligations (in one or more series) (the "Bonds") pursuant to the Act; and
WHEREAS, before proceeding with consideration of the request of the Borrower it is
necessary for the City to hold a public hearing on the proposal pursuant to the Act:
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NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk River,
Minnesota, as follows:
1. A public hearing on the proposal of the Borrower will be held at the time and
place set forth in the form of Notice of Public Hearing attached hereto as Exhibit A. The general nature
of the Project and an estimate of the aggregate principal amount of revenue bonds or other obligations to
be issued to finance the proposal are described in the Notice of Public Hearing.
2. The City Council hereby ratifies publication of the notice of the hearing in the
official newspaper of the City, one time not less than 15 days nor more than 30 days prior to the date
fixed for the hearing, substantially in the form of the attached Notice of Public Hearing.
The motion for the adoption of the foregoing resolution was duly seconded by member
and after full discussion thereof and upon vote being taken thereon, the
following voted in favor thereof
and the following voted against the same:
whereupon said resolution was declared duly passed and adopted this 6`" day of September, 2011.
John J. Dietz, Mayor
ATTEST:
Tina Allard, City Clerk
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391273v1 JSB EL185-16
STATE OF MINNESOTA
COUNTY OF SHERBURNE
CITY OF ELK RIVER
I, the undersigned, being the duly qualified and acting City Clerk of the City of Elk River, DOES
HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the
original thereof on file in my office, and that the same is a full, true and complete transcript of the minutes
of a meeting of the City Council of said City duly called and held on the date therein indicated, insofar as
such minutes relate to calling for a public hearing on the City's revenue bonds to finance a memory care
addition and renovations to an existing assisted living facility for Evans Park, Inc.
WITNESS my hand this day of September, 2011.
City Clerk
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391273v1 JSB EL185-16
EXHIBIT A
PUBLIC NOTICE
NOTICE OF A PUBLIC HEARING TO BE CONDUCTED BY THE CITY OF ELK RIVER,
MINNESOTA, TO CONSIDER THE ISSUANCE OF REVENUE BONDS BY THE CITY TO
FINANCE THE ACQUISITION, CONSTRUCTION, AND EQUIPPING BY EVANS PARK, INC. OF
AN ASSISTED LIVING FACILITY AND IMPROVEMENTS TO A SENIOR MULTIFAMILY RENTAL
HOUSING DEVELOPMENT LOCATED IN THE CITY
NOTICE IS HEREBY GNEN that the City Council (the "Council") of the City of Elk River,
Minnesota (the "City"), will hold a public hearing on Monday, September 19, 2011, at or after 6:30 p.m. at
City Hall, 13065 Orono Parkway, to consider a proposal that the City authorize the issuance of revenue
bonds (the "Bonds"), by the City, in one or more series, under the Minnesota Statutes, Chapter 462C, as
amended (the "Act"), in order to finance all or a portion of the following: (i) the acquisition, construction
and equipping of an approximately 30-unit memory care addition and certain other capital improvements
to the existing 60-unit assisted living facility located at 13439 185th Lane NW in the City (the "Project");
(ii) the funding of one or more reserve funds to secure the timely payment of the Bonds; (iii) the payment
of interest on the Bonds during the construction of the Project; and (iv) the payment of the costs of
issuing the Bonds. Evans Park, Inc., a Minnesota nonprofit corporation (the "Borrower"), will own and
operate the Project. The estimated aggregate principal amount of the proposed Bonds will not exceed
$3,800,000.
Following the public hearing, the Council will consider a resolution approving a housing program
prepared in accordance with the requirements of the Act, and granting approval to the issuance of the
Bonds. A draft copy of the housing program is available for public inspection during normal business
hours, Monday through Friday, at the City Hall in the City.
The Bonds will be special, limited obligations of the City, and the Bonds and interest thereon will
be payable solely from the revenues and assets pledged to the payment thereof. No holder of any Bond
will ever have the right to compel any exercise of the taxing power of the City to pay the Bonds or the
interest thereon, nor to enforce payment against any property of the City except money payable by the
Borrower to the City and pledged to the payment of the Bonds. Before issuing the Bonds, the City will
enter into an agreement with the Borrower, whereby the Borrower will be obligated to make payments at
least sufficient at all times to pay the principal of and interest on the Bonds when due.
Anyone desiring to be heard during this public hearing will be afforded an opportunity to do so.
In addition, interested persons may file written comments respecting the proposal with the City Clerk at
or prior to the public hearing.
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