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Department C K�1 Item Description: REQUEST FOR COUNCIL ACTION Manager Approved: Date: 10121r1002 Item No: VL A. Agenda Section: Public Hearing Public Hearing to Consider the Issuance of Tax-Exempt Bonds For Northwestern College Background State Statute provides for the issuance of tax-exempt bonds by municipalities for the benefit of educational institutions that are deemed to be in the best interest of the City, and results in no negative fiscal impact. The bonds are considered conduit debt, and do not constitute a financial obligation in any part by the City. However, the City must still meet all legal requirements prior to issuing any tax-exempt bonds, including holding a public hearing. Northwestern College has requested that the City provide tax-exempt financing for the purposes of funding student housing and a classroom portion of a new media center on the Northwestern College Campus located in Roseville and Arden Hills. The total amount of fmancing is appro�mately $1 0,000,000. At the September 23, 2002 Council Meeting, the City Council established a public hearing for the purposes of considering the issuance of tax-exempt bonds for Northwestern College. Discussion Items On three previous occasions, the City Council has heard discussions on the merit and legality of this particular bond financing assistance. During previous discussions, the general concerns centered on the legality of this type of assistance due to the religious nature of Northwestern College. The City's Bond Counsel of Briggs & Morgan concluded that they would not be willing to issue an unqualified opinion on the legality of the bonds. A summary of their position is included as Attachment A. Conversely, Northwestern College has obtained an opinion from the law firm of Ice Miller, which has concluded that these types of financing arrangements are legal. A summary of Ice Miller's position is included in Attachment B. Both the City's and Northwestern College's Bond Counsels will be in attendance. To ensure that the Council can make an informed decision, Staff has asked both parties to make a brief presentation to summarize their positions.