HomeMy WebLinkAbout6A, Motion to Approve Resolution 2008-033
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_HILLS
Request for Council Action
Prepared By: James Lehnhoff, City Planner
Council Meeting Date: July 14, 2008
Northwestern College Tax-Exempt Financing Public Hearing
Budgeted Amount:
$0.00
Actual Amount:
$0.00
Funding Source:
Recommendation:
Motion to Approve Resolution 2008-033 for the Issuance of Colorado Educational and
Cultural Facilities Authority Revenue Bonds in a Maximum Aggregate Principal Amount
of $9,000,000 for the Purposes of Financing and Refinancing the Costs of Acquisition,
Construction, Improvement, Renovation and Equipping of Certain Facilities and Certain
Other Matters Relating Thereto.
Supporting Documents:
1. July 14, 2008, Memo to the City Council
2. June 2,2008, Letter from Northwestern College
3. Resolution 2008-033
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MEMORANDUM
DATE: July 14, 2008
TO: Mayor & City Council
FROM: James Lehnhoff, City Planner
SUBJECT: Northwestern College Tax-Exempt Financing Public Hearing
Reauested Action
Motion to Approve Resolution 2008-033 for the Issuance of Colorado Educational and Cultural
Facilities Authority Revenue Bonds in a Maximum Aggregate Principal Amount of $9,000,000
for the Purposes of Financing and Refinancing the Costs of Acquisition, Construction,
Improvement, Renovation and Equipping of Certain Facilities and Certain Other Matters
Relating Thereto.
Back!!round
On June 2, 2008, Northwestern College submitted a request to the City of Arden Hills to hold a
public hearing for the issuance of tax-exempt financing for construction and improvement
projects on the Northwestern College campus. The construction and improvements projects
include the roadway relocation, parking facility, and certain landscaping costs. The projects
include the plans in Planning Case 08-006 that were approved on March 31,2008.
Although Arden Hills and Roseville have been requested to approve a resolution authorizing the
issuance of tax-exempt bonds to Northwestern College, the bonds will actually be issued by the
Colorado Educational and Cultural Facilities Authority (CECF A). CECF A is an organization
that specializes in tax-exempt financing for educational institutions around the country. For
more information on CECFA, please visit their website at http://www.cecfa.orgl.
Under Federal and State Statutes, municipalities are authorized to pledge their bond issuance
authority to non-profit groups for the benefit of higher education facilities. If a municipality
expects to issue or receive tax-exempt bond proceeds, either directly or indirectly through
City of Arden Hills
City Council Meetingfor July 14, 2008
\ \Metro-inet.us\ardenhills\Planning\Development ProjectsWorthwestern College\Bond Hearing \ 071408 - CC Report - NWC Bond Hearing. doc
Page 1 of2
separate establishments, the municipality is required by Federal law to hold a public hearing. In
this case, the bonds are being issued indirectly through CECF A.
The bonds will not constitute a charge, lien, or encumbrance upon any property of the City. The
bonds do not count toward the City's bank qualified debt, and they are not charged against the
general credit or taxing powers of the City. The City's bond counsel, Briggs & Morgan, have
reviewed the proposal and resolution, and they concur that the City would hold no financial
responsibility or liability for the bonds. The bonds are repaid through a revenue agreement
between CECF A and Northwestern College.
The purpose of the public hearing is to allow for public comment on the proceeds to be expended
by Northwestern College. The City of Roseville anticipates holding a similar public hearing on
July 28, 2008.
Recommendation
Approve Resolution 2008-033 for the issuance of Colorado Educational and Cultural Facilities
Authority revenue bonds in a maximum aggregate principal amount of $9,000,000 for the
purposes of financing and refinancing the costs of acquisition, construction, improvement,
renovation and equipping of certain facilities and certain other matters relating thereto.
Attachments
A - June 2, 2008, Letter from Northwestern College & Public Hearing Notice
B - Resolution 2008-033
City of Arden Hills
City Council Meetingfor July 14, 2008
\ \Metro-inet.us\ardenhills\Planning\Development ProjectsWorthwestern College\Bond Hearing\071408 - CC Report - NWC Bond Hearing.doc
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Attachment A
June 2, 2008, Letter from
Northwestern College
July 14, 2008, City Council Meeting
Northwestern College
5 l\ ! N T P A U L t tvl f N N E 5 {J T i\
June 2, 2008
Mr. Jalues Lehnoff, City Planner
City of Arden Hills
1245 West Highway 96
Arden Hills, Minnesota 55112
Re: Host Approval of Bond Financing for NOl1h\vestern College
Dear Mr. Lehnoff,
N011hwestern College CtNol1hwesternH) is interested in financing the costs of acquiring, renovating and
equipping an office building located at 2803 Lincoln Drive, Roseville, Minnesota and the costs of planning and
capital construction costs of calnpus road\vays and a parking facility, as well as cel1ain landscaping costs on its
Inain calnpus located at 3003 Snelling Avenue North, St Paul, Minnesota (collectively, the "Projectft). In order
to reduce its borrowing costs, N011hwestern plans to utilize tax-exelupt financing in \vhich the Colorado
Educational and Cultural Facilities Authority (ftCECF Aft) will issue tax-exelnpt bonds and loan the proceeds to
Northvvestern. The par alnount of the bond issue \villnot exceed $9,000,000.
Federal tax law requires that a public hearing be held and approval granted by the local governlnental unit in
which a project being financed with tax-exenlpt bonds is located. At least 14 days prior to such hearing, notice
of the hearing luust be published in a paper of general circulation in that jurisdiction. Because a pOl1ion of the
Project vvill be located within the jurisdiction of the City of Arden Hills (the 1!CityH), \ve are requesting that the
City hold a public hearing and grant approval of the issuance of the bonds to finance the pOl1ion of the Project
located within the City. This sanle process \vilt be undel1aken with the City of Roseville, as a pOJ1ion of the
Project is also located \vithin its jurisdiction. The bonds \vill not be issued by the City, will not constitute a debt
or obligation of the City and will not be taken into account when calculating the alTIOUl1t of bank qualified debt
that can be issued by the City. Northvvestern will payor reinlburse the City for any costs incurred in connection
\vith the holding of the public hearing or the granting of the approval for the Project.
Peck, Shaffer & Willianls LLP is serving as bond counsel for the financing and \vill vvork with your counsel,
vvho I believe is Briggs & Morgan, to assure that all legal requirenlents are satisfied (including drafting all
doculnentation and publishing the notice of the public hearing) and that the City is conlfortable with the process.
I alTI happy to answer any questions that you 111ight have and to provide you with any additional infofluation. I
look forward to working with you on this Blatter.
f.1 JCereIY':L .
I I" ~
) . . ,/~,
DOLI as R. Schroeder
NOlthvvestern College
Vice President for Business, CFO
3003 SNELLING AVENUE NORTH
SAINT PAUL, MINNESOTA 55113-1598
phone 651-631-5100
fax 651-631-5269
web www.nwc.edu
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ECF;. ~
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MEMBER
Colorado Educational and Cultural Facilities Authority (CECF A)
http://www . cecfa.org/
1 of 1
Colorado
Cultural
ucational and
cilities Authority
The Colorado Educational and Cultural Facilities Authority (CECFA), which was created by the
Colorado General Assembly, provides financing for colleges, universities, certain secondary
schools, charter schools, and other educational institutions, as well as financings for cultural
entities. CECFA also permits multistate financings upon the satisfaction of certain
requirements
A broad range of facilities can be financed, such as housing facilities, instructional facilities,
administration buildings, research facilities, laboratories, auditoriums, dining halls, food
service and preparation facilities and recreational facilities. There are generally no limits to
the size of the CECFA's financing.
Benefits of CECFA
· Expertise: CECFA has substantial expertise and experience in financing non-profits,
and can provide broad technical assistance in all aspects of the bond financing.
· Competitive Fees: The fees charged by CECFA are competitive in the field, and in
many cases are less than the comparable cost of hiring or retaining separate
consultants. Click here for schedule of fees.
Benefits of Tax Exempt Financing
· Lower Interest Rates: Historically, tax-exempt rates have been 200/0 to 250/0 below
taxable rates, which can translate into substantial interest savings over taxable
financing.
· Tax Exempt Bonds: CECFA issues tax-exempt revenue bonds, notes, or other
obligations and loans the proceeds from the sale of these obligations. By borrowing on
a tax-exempt basis rather than funding capital expenditures from internal funds, these
savings can, in some cases, be used to fund operations or build endowments. In
addition, the liquidity of the borrower is maintained for future contingencies. Click
here to find out more about CECFA bonds.
· Uses of Funds: This capital may be used to acquire, construct, reconstruct, repair,
alter, improve, extend, own, lease, and dispose of properties and to refinance
outstanding obligations.
Contact Us I Application Process &. Deadlines I Emplovment Opportunities
Staff I Working Group I Board I Bond Counsel I Investment Bankers
CECFA is not a state agency and receives no state appropriations
7/7/20084:14 PM
Attachment B
Resolution 2008-033
July 14, 2008, City Council Meeting
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CITY OF ARDEN HILLS
COUNTY OF RAMSEY
STATE OF MINNESOTA
RESOLUTION NO. 2008-033
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ARDEN HILLS,
MINNESOTA, APPROVING THE ISSUANCE OF COLORADO EDUCATIONAL AND
CUL TURAL FACILITIES AUTHORITY REVENUE BONDS IN A MAXIMUM
AGGREGATE PRINCIPAL AMOUNT OF $9,000,000 FOR THE PURPOSES OF
FINANCING AND REFINANCING THE COSTS OF ACQUISITION,
CONSTRUCTION, IMPROVEMENT, RENOVATION AND EQUIPPING OF CERTAIN
FACILITIES AND CERTAIN OTHER MATTERS RELATING THERETO
WHEREAS, it has been requested that the Colorado Educational and Cultural Facilities
Authority (the "Authority") participate in the issuance of one or more series of revenue bonds in
an aggregate principal amount not to exceed $9,000,000 (the "Bonds") to be used to: (a) finance
the costs of, or reimburse the Northwestern College (the "Institution") for the costs of, certain
higher education facilities and related costs, including but not limited to (i) acquisition,
renovation and equipping of an office building located at 2803 Lincoln Drive, Roseville,
Minnesota 55113, (ii) planning and capital construction costs of campus roadways and a parking
facility on the Institution's main campus located at 3003 Snelling Avenue North, Roseville,
Minnesota 55113 (the "Main Campus") and (iii) capital campus landscaping costs on the Main
Campus (collectively, the "Project"); (b) fund capitalized interest on the Bonds, if any; (c) fund
any required debt service reserve fund; and (d) pay certain costs of issuance of the Bonds,
including initial costs of any credit enhancement. The Institution will be the initial owner and
operator of the Project; and
WHEREAS, pursuant to Section 147(f) of the Code, prior to their issuance, the Bonds
are required to be approved by the "applicable elected representative" of the governmental unit
having jurisdiction over the entire area in which any facility financed or refinanced by the Bonds
is to be located, after a public hearing held following reasonable public notice; and
WHEREAS, the Institution has represented to the City of Arden Hills (the "City") that a
portion of the facilities located at 3003 Snelling Avenue North, Roseville, Minnesota to be
financed or refinanced are located within the territorial limits of the City; and
WHEREAS, the members of the City Council of the City are the applicable elected
representatives of the City; and
WHEREAS, Bond Counsel has advised that there has been published, at least 14 days
prior to the date hereof, in a newspaper of general circulation within the City, a notice that a
public hearing regarding the Bonds would be held on the date hereof; and
WHEREAS, such public hearing was conducted on the this date by the City Council of
the City, at which time an opportunity was provided to interested parties to present arguments
both for and against the issuance of the Bonds; and
WHEREAS, it is intended that this resolution shall constitute the approval of the
issuance of the Bonds and the facilities required by Section 147(f) of the Code;
WHEREAS, the City has been informed that the Bonds will not constitute a debt or
liability of the City and the City shall have no payment obligations with respect to the Bonds;
NOW THEREFORE, BE IT RESOLVED AND ORDERED by the City Council of
the City as follows:
1. The City Council hereby approves the issuance of the Bonds by the Authority for
the facilities to be financed and refinanced thereby. It is the purpose and intent of the City
Council that this resolution constitutes approval of the Bonds for the purposes of Section 147(f)
of the Code for the facilities. The City does not bear any responsibility for the tax-exempt status
of the Bonds, the debt service on the Bonds or any other matter related to the Bonds.
2. The Mayor and the staff of the City are hereby authorized and directed, jointly
and severally, to do any and all things and to execute and deliver any and all documents which
they deem necessary or advisable in order to carry out, give effect to and comply with the terms
and intent of this resolution and the financing transaction approved hereby.
3. This resolution shall take effect immediately upon its adoption.
ADOPTED BY THE CITY COUNCIL OF THE CITY OF ARDEN HILLS THIS
14TH DAY OF JULY, 2008.
Stanley D. Harpstead, Mayor
ATTEST:
Ronald J. Moorse, City Administrator
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CERTIFICATE
I, the undersigned, being the duly qualified and Assistant City Administrator of
the City of Arden Hills, Minnesota, do hereby certify that the attached resolution is a full, true
and complete resolution adopted by the City Council of said City on the date therein indicated.
WITNESS my hand this 15th day of July, 2008.
Noah Simon, Assistant City Administrator
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