Authorize the issuance of tax-exempt Multifamily Housing Revenue Bonds for the benefit of East Town Apartments Limited Partnership for a 169-unit affordable housing project at 618 9th Ave. S., Mpls. (formerly proposed at 815 6th St. S.) WHEREAS, the Hennepin County Housing and Redevelopment Authority (the Issuer ) is a housing and redevelopment authority and a public body corporate and politic duly organized and existing under the Constitution and laws of the State of Minnesota; and WHEREAS, on December 13, 2016, the Board of Commissioners (the Board ) of the Issuer adopted Resolution 16- HCHRA-0049 (the Preliminary Resolution ), under the terms of which the Issuer granted preliminary approval to the issuance of multifamily housing revenue obligations, in an amount not to exceed 20,000,000, under the terms of Minnesota Statutes, Chapters 462C and 474A, as amended (collectively, the Act ), for the benefit of East Town Apartments Limited Partnership, a Minnesota limited partnership (the Borrower ); and WHEREAS, the Preliminary Resolution constitutes a reimbursement resolution and an official intent of the Issuer to reimburse expenditures with respect to the Project (as hereinafter defined) from the proceeds of tax-exempt revenue obligations in accordance with the provisions of Treasury Regulations, Section 1.150-2; and WHEREAS, on May 2, 2017, following a duly noticed public hearing, the Board adopted Resolution 17-HCHRA-0022 (the Temporary Note Resolution ), pursuant to which the Board authorized the issuance of the Issuer s Multifamily Housing Revenue Note (East Town Apartments Limited Partnership Project), Series 2017 (the Note ), in the principal amount of 9,885,638, to provide short-term financing for the acquisition, construction, and equipping of an approximately 169-unit multifamily rental housing development to be located at 815 South Sixth Street in the City of Minneapolis, Minnesota for occupancy by persons and families of low-and moderate-income (the Project ); and WHEREAS, the Issuer issued the Temporary Note on May 22, 2017 and sold it to Bridgewater Bank; and WHEREAS, the Borrower intended to refund the Temporary Note with the proceeds of permanent obligations to be issued by the Issuer; and WHEREAS, the location of the Project is now proposed be at 618 9th Avenue South in the City of Minneapolis, which is on the same city block as the originally proposed address of 815 South Sixth Street in the city; and WHEREAS, the Borrower is requesting that the Issuer now issue its multifamily housing revenue obligations, in one or more series, as tax-exempt obligations (the Obligations ), in the maximum aggregate principal amount of 9,885,638, as permanent financing for the Project, the proceeds of which shall be used to refund the Temporary Note, the unspent proceeds of which shall be applied to the payment of costs for the acquisition, construction, and equipping of the Project; and WHEREAS, the Obligations are proposed to be issued pursuant to the Preliminary Resolution, the Temporary Note Resolution, this resolution, and the Act; and WHEREAS, the Obligations shall be sold to U.S. Bank National Association, a national banking association, or another commercial lender selected by the Borrower (the Lender ), in a private placement under terms and conditions negotiated between the Borrower and the Lender, and the proceeds derived from the sale of the Obligations shall be loaned by the Issuer to the Borrower pursuant to the terms of a Loan Agreement, dated on or after October 2, 2018 (the Loan Agreement ), between the Issuer and the Borrower; and WHEREAS, the interests of the Issuer in the Loan Agreement (except for certain rights of indemnification, the payment of the fees of the Issuer, and the payment and reimbursement for certain costs and expenses of the Issuer) Page 3 of 14 shall be assigned to the Lender pursuant to an Assignment of Loan Agreement, dated on or after October 2, 2018 (the Assignment of Loan Agreement ), between the Issuer and the Lender; and WHEREAS, the obligations of the Borrower under the Loan Agreement shall be secured by such mortgages, assignments of mortgages, security agreements, assignments of rents, guarantees, and other security instruments and documents as the Borrower and the Lender shall agree (the Security Documents ), including in particular, a Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing (or another document with an alternate title), dated on or after October 2, 2018, from the Borrower to the Issuer, which shall be assigned by the Issuer to the Lender under the terms of an Assignment of Mortgage, dated on or after October 2, 2018 (the Assignment of Mortgage ); and WHEREAS, to ensure compliance with certain rental and occupancy restrictions imposed by the Act and Section 142(d) of the Internal Revenue Code of 1986, as amended (the Code ), the Issuer, the Borrower, and the Lender shall execute a Regulatory Agreement, dated on or after October 2, 2018 (the Regulatory Agreement ); and
certified copies of all proceedings and records of the Issuer relating to the Obligations, and such other affidavits and certificates as may be required to show the facts relating to the Obligations as such facts appear from the books and records in the custody and control of the Issuer; and all such certified copies, certificates, and affidavits, including any heretofore furnished, shall constitute representations of the Issuer as to the truth of all statements contained therein. The Issuer Officials are hereby further authorized to execute and deliver, on behalf of the Issuer, all other certificates, instruments, and other written documents that may be requested by Kennedy Graven, Chartered ( Bond Counsel ), the Lender, the Borrower, or other persons or entities in conjunction with the issuance of the Obligations and the expenditure of the proceeds of the Obligations. Without imposing any limitations on the scope of the preceding sentence, the Issuer Officials are specifically authorized to execute and deliver such other documents and certificates as are necessary or appropriate in connection with the issuance, sale, and delivery of the Obligations, including one or more consents to the assignment of a development agreement, and other funds made available to the Borrower and the Project, one or more Information Return for Tax-Exempt Private Activity Bond Issues, Form 8038, with respect to the Obligations, endorsements to any tax certificates as to arbitrage, rebate, and other federal tax matters executed and delivered in connection with the issuance of the Obligations, appropriate amendments to the Housing Program (as described in the Preliminary Resolution and the Temporary Note Resolution), and all Page 5 of 14 other documents and certificates as the Issuer Officials shall deem to be necessary or appropriate in connection with the issuance, sale, and delivery of the Obligations. The Issuer Officials are hereby further authorized and directed to execute and deliver all other instruments and documents necessary to accomplish the purposes for which the Obligations are to be issued. The preparation and filing of Uniform Commercial Code financing statements with respect to the assignment of the interests of the Issuer in the Loan Agreement (excluding any unassigned rights as provided in the Loan Agreement), are hereby authorized. The Issuer hereby authorizes Bond Counsel to prepare, execute, and deliver its approving legal opinions with respect to the Obligations.
the Obligations. In the event that an official statement or other disclosure document is prepared relating to the offer and sale of the Obligations ( Disclosure Documents ), the Issuer will not participate in the preparation or distribution of such Disclosure Documents and will make no independent investigation with respect to the information contained in the Disclosure Documents and the Issuer assumes no responsibility for the sufficiency, accuracy, or completeness of such information.
documents shall be deemed to be a covenant, stipulation, obligation, or agreement of any member of the Board, or any officer, agent, or employee of the Issuer in that person s individual capacity, and neither the Board nor any officer, agent, or employee executing the Obligations or any such documents shall be personally liable on the Obligations or such documents or be subject to any personal liability or accountability by reason of the issuance of the Obligations or the execution and delivery of such documents. No provision, covenant, or agreement contained in the aforementioned documents, the Obligations, or in any other document relating to the Obligations, and no obligation therein or herein imposed upon the Issuer or the breach thereof, shall constitute or give rise to a general or moral obligation of the Issuer or any pecuniary liability of the Issuer or any charge upon its general credit or taxing powers. In making the agreements, provisions, covenants, and representations set forth in such documents, the Issuer has not obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Loan Agreement, which are to be applied to the payment of the Obligations, as provided therein.
Issuer, or of the aforementioned documents, or of the Obligations issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this resolution, or of the aforementioned documents, or of the Obligations, but this resolution, the aforementioned documents, and the Obligations shall be construed and endorsed as if such illegal or invalid provisions had not been contained therein.
liabilities imposed upon the Board or the Issuer by the provisions of this resolution or of the aforementioned documents shall be exercised or performed by the Issuer or by such members of the Board, or such officers, employees, or agents, or by such board, body, or agency thereof as may be required or authorized by law to exercise such powers and to perform such duties. No covenant, stipulation, obligation or agreement herein contained or contained in the aforementioned documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the Board, or any officer, agent, or employee of the Issuer in that person s individual capacity, and neither the Board nor any Issuer Officials executing the Obligations shall be personally liable on the Obligations or be subject to any personal liability or accountability by reason of the issuance thereof. 20. The provisions of this resolution hereby supplement the Preliminary Resolution and the Temporary Note Resolution. 21. This resolution shall be in full force and effect from and after its approval. ADOPTED Commissioner Peter McLaughlin moved to adopt the Resolution, seconded by Commissioner Debbie Goettel and approved - 7 Yeas
Background: History: The Hennepin County Housing and Redevelopment Authority (HCHRA) accepted two awards from Minnesota Housing Finance Agency (Minnesota Housing) to maintain and increase the supply of safe, stable owner-occupied housing (Resolution 16-HCHRA-0042). To fully expend one of the awards, Minnesota Housing and the HCHRA wish to extend the contract period. The Healthy Homes Assistance project was awarded 75,000 to help address health and safety hazards in residents homes. The award is being used to assist at least 13 homes address emergency health and safety repairs, hazards in manufactured homes, or repairs such as radon mitigation and fall prevention. Agreement A166355 is currently set to expire on December 31, 2018; Minnesota Housing has agreed to extend the term to March 26, 2019, to facilitate close-out and full usage of grant funds.
The HCHRA approved 300,000 to support the construction of 10 affordable homes on tax forfeit lots in Minneapolis with the remaining 100,000 held in reserve for suburban projects (Resolution 17-HCHRA- 0010). The City of Bloomington Housing and Redevelopment Authority (HRA) is in the process of acquiring a tax forfeit lot from Resident and Real Estate Services (RRES). The city intends to demolish the home and Habitat for Humanity will construct a new home affordable to households at or below 60 percent of area median income (AMI). The total development cost of the home is expected to be approximately 325,000. Funding to support construction and affordability gaps on the project will come from the HCHRA, the City of Bloomington HRA, and Habitat for Humanity. The Bloomington HRA will match the HCHRA investment of 35,000.
Impact/Outcomes: Agreement PR00000631 will reduce the inventory of RRES tax forfeit lots, allow for the construction of an affordable single-family home, and increase the tax base. This request aligns with Hennepin County disparity reduction efforts by increasing the supply of extremely affordable housing. Page 10 of 14 Recommendation from County Administrator: Recommend Approval
Background: History: In collaboration with Purchasing and Contracted Services and the County Attorney s Office, Resident and Real Estate Services (RRES) created the Small Business Enterprise (SBE) Home Rehabilitation pilot program in 2016. The SBE Home Rehabilitation pilot program goals were: 1) to successfully rehabilitate a feasible number of tax-forfeit homes annually; 2) to partner with local contractors to provide business development and job opportunities for emerging small business firms and Hennepin County residents; and 3) to create housing opportunities for new homeowners and responsible property owners.
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