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� <br />EN HILLS <br />MEMORANDUM <br />DATE: June 27, 2011 <br />TO: Honorabie Mayor and City Councilmembers <br />Patrick Klaers, City Administrator <br />FROM: Sue Iverson, Directar of Finance and Administrati�re Services <br />SUBJECT: Waiver Letter for Housing Revenue Bonds for Presbyterian Hoznes of <br />Arden Hills, Inc. <br />Sack�round <br />As part of the Development agreement with Presbyterian Homes, the Czty stipt�lated thai <br />all canduit debt for ihe project needed to be done through the City of Arden Hills. As <br />part of that agreerrr�ent, the fee schedule for the conduit debt payable to the City of Arden <br />Hills was agreed upon, based on. the for�nula u�ed by the City o� Blaine. <br />At the iime the developmeni agreement was made, Cities had the ability to issue <br />$30,0OO,OQO in bank qualified bonds per year. The Federal Government has since <br />char3ged the limit to $10,000,000. Presbyterian Hornes is asking the City Council to <br />waive the reading of Sectian 7.1(d} — that the City of Arden Hills issue 100% of �he <br />bands — with the conditian thai Presbyterian Homes will pay ihe fu11 fee as �� the City of <br />Axden Hills issued all the bonds. <br />This waiver will allow Presbyierian Ho�nes ta issue bank qualified debt for the entire <br />bond issue by using multiple jurisdictions. The City's Bond Counsel, Steve Bubul, has <br />drawn up the required waiver let�er and provided infoz�mation in ihe attached Ietter. <br />Financial or Other Considerations <br />By approving this waiver, ihe City will still receive the entire amount of the fee fox <br />conduit debt �hat it would have received if the City had issued all the bonds. The waiver <br />is only for this one section of the development agreemen�, everything else remains the <br />same. If the City were ta need to issue debt, the contract aiready pratects the City as <br />Presbyterian Homes would have to pay the difference beiween tha interest rate of the <br />bank qualified bonds and the bonds that are not bank qualified. <br />City Council Meeting <br />11Metro-inetlardenhi11s1AdminlCouncillAgendas & Packet Information12 6 1 116-27-1 1 RegularlPacket InformationlWai�er <br />Ietter far Presbyterian Homes Conduit Debt.doc <br />Page 1 of 2 <br />