03-27-95 agenda• CITY OF RICHFIELD, MINNESOTA
MONDAY, MARCH 27, 1995
7:00 P.M.
COUNCIL CHAMBERS
CONCURRENT CITY COUNCIL/SPECIAL HOUSING AND
REDEVELOPMENT AUTHORITY MEETING
AGENDA
INTRODUCTORY PROCEEDINGS
CALL TO ORDER
PLEDGE OF ALLEGIANCE
ITEMS TO BE CONSIDERED BY HRA:
APPROVAL OF MINUTES OF THE (1) REGULAR HRA MEETING OF FEBRUARY 28,
1995 AND (2) CONCURRENT HRA/CITY COUNCIL MEETING OF MARCH 13, 1995
CONSIDERATION OF RESOLUTION AUTHORIZING PURCHASE OF 7429
DUPONT AVENUE FOR RICHFIELD REDISCOVERED PROGRAM
HRA LETTER NO. 19
• 2. CONSIDERATION OF MODIFIED SUBORDINATION AGREEMENT; PHASE I,
CSM
HRA LETTER NO. 20
3. CLAIMS AND PAYROLLS
ITEM TO BE CONSIDERED CONCURRENTLY BY HRA AND CITY COUNCIL:
1. CONCURRENT MEETING WITH CITY COUNCIL TO CONSIDER A
RESOLUTION APPROVING HOUSING PLAN AND ISSUANCE OF TAX
EXEMPT REVENUE BONDS TO PURCHASE AND RENOVATE CENTURY
COURT APARTMENTS
HRA LETTER NO. 21
2. CONSIDERATION OF RESOLUTION APPROVING HOUSING PLAN AND
ISSUANCE OF TAX EXEMPT REVENUE BONDS TO PURCHASE AND
RENOVATE CENTURY COURT APARTMENTS
COUNCIL LETTER NO. 81
ADJOURNMENT OF HRA
REGULAR CITY COUNCIL MEETING
CONTINUES AFTER CONCURRENT MEETING
•
CALL TO ORDER
AGENDA
APPROVAL OF MINUTES OF THE REGULAR CITY COUNCIL MEETING OF
MARCH 13, 1995
PRESENTATIONS
1. OPPORTUNITY FOR PERSONS TO ADDRESS THE COUNCIL ON ITEMS NOT
LISTED ON THE AGENDA
2. PRESENTATION OF PUBLIC SAFETY DEPARTMENTAL COMMENDATION TO
POLICE OFFICER WILLIAM NIKITUK IN RECOGNITION OF RECEIVING BEST
POLICE OFFICER PERFORMANCE EVALUATION FOR 1994
AGENDA APPROVAL
3. COUNCIL APPROVAL OF AGENDA
CONSENT CALENDAR
4. CONSENT CALENDAR CONTAINS SEVERAL SEPARATE ITEMS WHICH ARE
ACTED UPON BY THE CITY COUNCIL IN ONE MOTION. ONCE THE
CONSENT CALENDAR HAS BEEN APPROVED, THE INDIVIDUAL ITEMS AND
• RECOMMENDED ACTIONS HAVE ALSO BEEN APPROVED. NO FURTHER
COUNCIL ACTION IS NECESSARY. HOWEVER, ANY COUNCIL MEMBER
MAY REQUEST THAT AN ITEM BE REMOVED FROM THE CONSENT
CALENDAR AND PLACED ON THE REGULAR AGENDA FOR COUNCIL
DISCUSSION AND ACTION. ALL ITEMS LISTED ON THE CONSENT
CALENDAR ARE RECOMMENDED FOR APPROVAL.
A. CONSIDERATION OF APPROVAL OF APPLICATION FOR ARBY'S, 7744
FIFTH AVENUE, TO INSTALL DIRECTIONAL SIGN IN 77TH STREET
CORRIDOR C.L. 82
B. CONSIDERATION OF APPROVAL OF REMOVAL OF STOP SIGNS AT 76TH
STREET AND EMERSON AVENUE C.L. 83
C. CONSIDERATION OF APPROVAL OF CONSENT AND AGREEMENT
RELATING TO EMERSON AVENUE LICENSURE AGREEMENT AND
COLFAX AVENUE AGREEMENT; CSM, PHASE I C.L. 84
D. CONSIDERATION OF APPROVAL OF PAYMENT IN EXCESS OF $5,000 TO
LEAGUE OF MINNESOTA CITIES IN AMOUNT OF $9,907.92 C.L. 85
E. CONSIDERATION OF APPROVAL OF PURCHASE IN EXCESS OF $5,000
FOR SUMMER BROCHURE PRINTING FROM NYSTROM PUBLISHING IN
AMOUNT OF $5,498 C.L. 86
F. CONSIDERATION OF APPROVAL OF BID MINUTES/TABULATION AND
AWARD OF CONTRACT FOR DEMOLITION AND REMOVAL OF BUILDINGS
AT 6913 AND 6933 PENN AVENUE TO APPLE EXCAVATING, INC. IN
AMOUNT OF $7,450.00 C.L. 87
G. CONSIDERATION OF APPROVAL OF BID MINUTES/TABULATION AND
AWARD OF CONTRACT FOR ONE HIGH VELOCITY SEWER CLEANER
FROM FLEXIBLE PIPE & TOOL COMPANY IN AMOUNT OF $41,291.86 C.L.
• 88
H. CONSIDERATION OF APPROVAL OF BID MINUTES/TABULATION AND
AWARD OF CONTRACT FOR ONE NEW ASPHALT PATCH BOX FOR USE
BY STREET MAINTENANCE DIVISION FROM RUFFRIDGE-JOHNSON
COMPANY IN AMOUNT OF $17,935.67 C.L. 89
1. CONSIDERATION OF APPROVAL BID MINUTES/TABULATION AND
AWARD OF CONTRACT FOR NEW HYDRAULIC KNUCKLE BOOM LOADER
WITH 18' BOX FROM CRYSTEEL TRUCK EQUIPMENT IN AMOUNT OF
$35,230 C.L. 90
PUBLIC HEARINGS
5. PUBLIC HEARING REGARDING AMENDMENT TO CONDITIONAL USE PERMIT
TO ALLOW EXPANSION OF FRASER SCHOOL, 2400 WEST 64TH STREET
COUNCIL LETTER NO. 91
6. PUBLIC HEARING AND SECOND READING OF TRANSITORY ORDINANCE
VACATING PORTION OF OLD 77TH STREET BETWEEN EMERSON AND
COLFAX AVENUES; CSM, PHASE
COUNCIL LETTER NO. 92
7. PUBLIC HEARING AND SECOND READINGS OF: ORDINANCE AMENDMENT
TO ZONING ORDINANCE ON ADULT USES; AMENDMENT TO SECTION
2020.01 PROHIBITING NUDITY IN LICENSE ESTABLISHMENTS; ADULT
ESTABLISHMENT ORDINANCE; AND ORDINANCE RELATING TO PREMISES
CONDUCIVE TO HIGH-RISK SEXUAL CONDUCT
. COUNCIL LETTER NO. 93
8. CONTINUANCE OF PUBLIC HEARING TO EXPAND BOUNDARIES OF
REDEFINED INTERSTATE/NICOLLET/LYNDALE/77TH STREET ASSESSMENT
PROJECT AREA AND CONSIDERATION OF RESOLUTION ORDERING
UNDERTAKING OF CURRENT MAINTENANCE SERVICE PROJECT FROM
JANUARY 1 THROUGH DECEMBER 31, 1995, CITY PROJECT NO. 901
COUNCIL LETTER NO. 94
9. CONSIDERATION OF TRANSITIONAL ACTIVITY PERMIT AND OFF-STREET
PARKING PERMIT FOR RICHFIELD PLUMBING AND HAGEN MICRO AGE, 510
WEST 77TH STREET
COUNCIL LETTER NO. 95
RESOLUTION
10. CONSIDERATION OF RESOLUTION APPROVING LABOR AGREEMENT
BETWEEN CITY OF RICHFIELD AND RICHFIELD POLICE SUPERVISORS
BARGAINING UNIT LOCAL 162 FOR 1995
COUNCIL LETTER NO. 96
PROPOSED ORDINANCES
11. CONSIDERATION OF RESOLUTION AUTHORIZING ACQUISITION OF 7216
FIRST AVENUE TO PERMIT HRA TO PROCEED WITH HENNEPIN TECHNICAL
COLLEGE NEW CONSTRUCTION PROJECT AND FIRST READING OF
ORDINANCE AUTHORIZING SALE OF PROPERTY TO HRA
COUNCIL LETTER NO. 97
12. CONSIDERATION OF FIRST READING OF COMPREHENSIVE REVISION OF
ZONING CODE
COUNCIL LETTER NO. 98
ADMINISTRATIVE REPORTS & OTHER BUSINESS
13. CONSIDERATION OF RECEIPT OF UNAUDITED 1994 FINANCIAL REPORT
COUNCIL LETTER NO. 99
14. CONSIDERATION OF REQUEST FOR DETERMINATION ON APPROPRIATE
ZONING CLASSIFICATION FOR DRAPERY SERVICE BUSINESS, 7301 PENN
AVENUE
COUNCIL LETTER NO. 100
AIRPORT BUSINESS
15. AIRPORT STATUS REPORT
77TH STREET PROJECT BUSINESS
16. 77TH STREET PROJECT STATUS REPORT
CORRESPONDENCE
17. LEGISLATIVE REPORT
COUNCIL CHOICE
18. COUNCIL DISCUSSION ITEMS
19. CLAIMS AND PAYROLLS
20. ADJOURNMENT
Auxiliary aids for individuals with disabilities are available upon request.
Requests must be made at least 96 hours in advance to the Administrative
Services Director at 861-9702.
0
Iq
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 100
Agenda March 27, 1995
Issue Statement:
Request for a determination on the appropriate zoning classification for a drapery
service business.
Background:
The Drapery Place is being displaced from 77 1/2 Street as a result of Phase II of the
Shops at Lyndale. A possible relocation site is 7301 Penn Avenue which formerly
housed Steve's Detailing which is zoned for C-1 neighborhood business. A drapery
service business is not specifically permitted nor prohibited in a C-1 district.
Recommended Motion:
Review the request and determine that the proposed drapery service business is a
permitted use in a C-1 district.
Basis of Recommendation:
1. A drapery service business is neither specifically permitted nor prohibited in a C-1
district.
a 2. Section 505.11 of the City Code states that when a proposed use is not listed, the
use should be referred to the Council for an appropriate classification.
3. Local service establishments are permitted. Also permitted are uses similar to a
drug store, clothes cleaning and dry good pickup station, business or professional
office.
4. The proposed use is a service rather that a retail sales facility and will generate
less customer traffic than other permitted uses.
5. A significant share of their business is done at the customer's home.
6. Hours of operation are compatible with neighboring residential use.
7' No noise would be generated by their operations.
8. Parking is adequate and a van would be parked inside at night.
9. Many uses that are permissible at the Penn Avenue site would be more intrusive
than the proposed use
10. The City Council and HRA have instructed staff to work with businesses relocating
from 77 1/2 Street to help them stay in the City. This is a long time Richfield
business.
14-I
Alternative Recommendation:
The City Council could determine that the proposed use should be classified as a
"prohibited" use in a C-1 district.
Discussion/Decision Mode:
Consideration of this item is scheduled for the March 27, 1995 City Council meeting.
Petitioner has suggested that an April 1, 1995 contractual date must be met. No
notification or publication is required. Petitioner has been encouraged to discuss his
proposal with the neighbors and a notice was sent to the neighbors on March 23, 1995.
Respectf I submitted,
r
osser
Jam??r,
City Manager
JDP:cak
0
/C/_C2
77se Drapery Place 61 1 WEST 771/2 STREET
RICHFIELD, MINNESOTA 55423
(6123661-6055
COMPLETE WINDOW TREATMENT CENTER
March 21, 1995
Mr. Byron J. Wallace
Community Development Director
City of Richfield
6700 Portland Avenue
Richfield, MN 55423
RE: The Relocation of the Drapery Place
Dear Mr. Wallace:
This letter responds to your request for information to present to the City Council, on March
27th, regarding the relocation of the Drapery Place from our current location on 771/2, Street to
our proposed location at 7301 Penn Ave. in Richfield. As you are probably aware, we are
forced to secure a new location for our business due to the condemnation of our current site for
the development of the Shops at Lyndale.
I would like to take this opportunity to introduce myself and my business. The Drapery Place
is a corporation. I've owned and operated The Drapery Place for the past 23 years and have
been located at our current site on 771/2 Street since 1978. We currently have 3 full-time and
4 part-time employees.
The Drapery Place is a service organization offering full-service window treatments. As such,
we offer our customers a window treatment showroom, provide consultation services, and
maintain a service area. Since most of our business is derived from existing client referrals and
at-home consultations, our in-store traffic is fairly light compared to many retail establishments.
Our hours of operation coincide very nicely with the residential environment of the Penn Ave.
location as well. Store hours are: Monday - Wednesday 9-5; Thursday 9-7; Friday 9-4; and
Saturday 9-12.
Since our primary business caters to residential customers, we believe the concept of a
neighborhood business ties in very nicely with the selected Penn Ave. site. We run a very quiet
and clean operation that would enhance the neighborhood rather than detract from it. Since this
particular site has garage doors, we will also be able to park our van inside, thus maintaining
a tidy exterior appearance.
0
lq-?
Mr. Byron J. Wallace
March 21, 1995
Page Two
In summary, we are forced to secure a new site for our business due to the condemnation of our
current site for the development of the Shops at Lyndale. The City of Richfield would like us
to relocate within Richfield, and it is our desire to do so. We are impressed with the
neighborhood, economic development, lighting and zoning of the site at 7301 Penn Ave. We
have looked at several other locations, but they remain less desirable or less suitable to our type
of business and clientele. We are hopeful that the Penn Ave. location will serve us well into
the future.
Mr. Wallace, with time being of the essence due to the new development and 90 day quick-take,
it is imperative that we move quickly on approving this new location far The Drapery Place.
If you have any questions or need additional information before the March 27th Council
meeting, please call me at 861-6055. I look forward to a speedy resolution to our impending
relocation.
Sincerely,
4 IY---
Keith Glanzer
President
KG/lv
Enclosure
40
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 99
Agenda March 27, 1995
Issue Statement:
Council receipt of the unaudited 1994 Financial Report.
Background:
The annual Financial Report for the period ended December 31, 1994, has been completed
by the Administrative Services Department. The audited Financial Report is not available at
this time, due to the audit provision which requires Richfield's financial reports to be audited
by Deloitte and Touche subsequent to April 15. As Council Members may be aware, the City
receives a reduced audit fee in turn for approval for the Auditors to delay their audit work
until after April 15. The audit is scheduled to begin April 17,1995.
The Richfield City Charter requires the Financial Report to be submitted to the City Council
for fiscal year-end information by April 10 of each year. The report is submitted for official
receipt at the March 27, 1995 City Council meeting.
The attached summary report reflects the performance of the General Fund, Municipal
Liquor Fund, Utility Funds, and Recreation Fund.
Recommended Motion:
Receive the unaudited 1994 Financial Report of the City.
Basis of Recommendation:
1. City Charter provides that the Financial Report.of the City be submitted to the City
Council by April 10 of each year.
2. Audited financial reports for 1994 will not be available for several weeks.
3. The Administrative Services Department has just completed their financial
reporting for 1994.
Alternative Recommendation:
1. The City Council could request the staff to make a more detailed presentation of the
unaudited 1994 Financial Report at this time or at a future Council Study Session.
However, a detailed presentation of the audited report will be presented in the
month of June 1995.
Discussion/Decision Mode:
The Financial Report be formally accepted at the March 27,1995 City Council meeting.
Respectf ly submitted,
49 Jam . Prosser
City nager
JDP
J3-/
FINANCIAL REPORT SUMMARY
FOR THE YEAR ENDED DECEMBER 31, 1994
The following is a summary of fund highlights for the General Fund, Municipal Liquor Fund,
Water, Sanitary Sewer, and Storm Sewer Utility Funds, and the Recreation Fund. A more
detailed, audited report will be presented to the City Council after the audit has been completed
in June.
General Fund
1994 Actual
Revenues $12,155,401
Expenditures 11,693,258
Net Transfers (306,547)
Increase to Fund Balance 155,596
Fund Balance, 12/31 $ 2,770,643
1994 Budget
$11,989,820
12,203,490
213,670
0
$2,615,047
1993 Actual
$11,644,425
11, 549, 868
16,099
110,656
$ 2,615,047
As of December 31, 1994, the City General Fund has a fund balance of $2,770,643, an
increase of $155,596 from December 31, 1993. The year-end fund balance is designated for
working capital and is necessary to meet expenditures until property taxes are collected in July
1995.
In 1994, General Fund revenues exceeded budget by approximately $165,000. This was
primarily due to unanticipated revenue from permits issued for various improvements made by
the Richfield Public Schools and for the CSM Corporation development in the
Interstate/Lyndale/Nicollet tax increment district.
The positive results in 1994 can be attributed largely to all General Fund departments ending
the year under budget. The Public Safety and Community Services departments ended the
year with the unexpended budget amounts of approximately $180,000 each. The Police, Fire,
and Police Ancillary Services divisions incurred savings in personal services, other services and
charges, and capital outlay. Some of these savings are due to the timing of the purchases. In
the Community Services Department, the majority of the savings were incurred by the Streets
division as funds allocated for street maintenance were not expended prior to year-end.
In 1994, the General Fund transferred a total of $475,000 to the Housing and Redevelopment
Authority, $225,000 for current airport expenditures and $250,000 designated for the future cost
of estimated airport litigation.
Municipal Liauor Fund
1994 Actual 1994 Budaet
40 In 1994, the three municipal liquor stores reached $6,838,300 in gross sales, an increase of
Revenues $6,913,466 $7,100,910
Expenses 6,263,612 6,485,660
Net Transfers (549,970) (549,970)
Net Income 99,884 65,280
Retained Earnings, 12/31 $2,228,863 $2,194,259
1993 Actual
$6,843,736
6,235,830
(646, 040)
(38,134)
$2,128,979
slightly over $85,000 in comparison to 1993. Operating expenses were at the same level as
1993, with increases in personal services being offset by savings in other services and charges
1 13_
Financial Summary
Page 2
and supplies. Transfers in 1994 include $400,000 transferred to the Special Revenue Fund for
various capital improvements and $149,970 to the General Fund for administrative costs, public
safety services, and payments in lieu of taxes. Expense incurred relating to the write-off of bad
checks decreased almost 50% as a result of switching to a check validation system in 1994.
Water Utility Fund
Revenues
Expenses
Net Transfers
Net Income
Retained Earnings, 12/31
1994 Actual
$1,797,206
1,666,706
41,926
172,426
$5,056,880
1994 Budget
$1,852,000
1,677,530
0
174,470
$5,058,924
1993 Actual
$1,723,987
1,451, 555
(68,094)
(204, 338)
$4,884,454
In 1994, the Water Utility operating revenues were approximately $186,000 higher than in 1993
as a result of an increase in water usage and an increase in rates. The increase in operating
revenues was offset by an anticipated decrease in interest income of $117,267 due to the
expenditure of cash to fund the renovation of the water plant. Operating expenses showed an
increase in professional services and chemicals, both relating to the continued adjustment and
testing of the water quality. Transfers were from the Richfield Rediscovered Program as
repayment of amounts transferred in prior years.
Sanitary Sewer Utility
Revenues $1,833,408
Expenses 2,042,635
Net Transfers 41,926
Net Income (Loss) (167,301)
Retained Earnings, 12/31 $2,537,651
1994 Actual
1994 Budget
$1,820,000
1,972,310
0
(152, 310)
$2,552,642
1993 Actual
$1,699,793
1,883,727
19,653
(164, 281)
$2,704,952
In 1994, the Sanitary Sewer Utility operating revenues were approximately $136,000 higher
than in 1993, primarily due to an increase in rates. The increase in operating revenues was
offset by an increase in treatment charges paid to the Metropolitan Council-Wastewater
Services of $124,574. Operating expenses showed an increase in personal services and parts,
tools, and supplies. Transfers were from the Richfield Rediscovered Program as repayment of
amounts transferred in prior years.
Storm Sewer Utility Fund
1994 Actual
Revenues $705,668
Expenses 632,809
Net Transfers 160,000
Net Income 232,859
Retained Earnings, 12/31 $1,386,006
1994 Budget
$700,000
621,910
500,000
578,090
$1,731,237
1993 Actual
$701,786
575,151
0
126,635
$1,153,147
/3P3
Financial Summary
Page 3
Revenues for the Storm Sewer Utility Fund in 1994 were at the same level as in 1993. The
increase in expenses reflects an increase in professional services for aerial photography and
mapping and storm pond dredging. Transfers in 1994 were from the Permanent Improvement
Revolving Fund and funded residential improvements which will prevent or mitigate storm water
damage.
Recreation Fund
Revenues
Expenses
Net Transfers
Net Income (Loss)
Retained Earnings, 12/31
1994 Actual 1994 Budget
$1,894,252
1,788,331
(100,100)
5,821
$1,115,954
070
$2047,070
1, 778,110
(141,280)
127,680
$1,237,813
1993 Actual
$1,765,088
1,652,459
(128,530)
(15,901)
$1,110,133
The Recreation Fund includes the golf course, ice arena, swimming pool, and special facilities
(miniature golf, concessions, farmers' market) operations. An increase in operating revenues
from 1993 to 1994 was primarily for the golf course operations, which ended the year with
income before transfers of $204,663. The ice arena and swimming pool operations ended the
year with losses of approximately $47,000 each, and the special facilities operations had a
small loss of $3,824. There were no transfers made from the Swimming Pool or Special
Facilities Funds to repay prior year transfers due to the losses incurred in 1994.
Summary
This financial summary includes the.highlights of the overall financial results for the City of
Richfield for the year ended December 31, 1994. Financial reports for each fund are attached
to this letter.
A comprehensive review of the 1994 financial operations will be presented to the City Council
after the completion of the annual audit by the City's independent auditors.
In 1994, the General Fund had a very strong year due to the realization of budgeted revenues
and to the efforts of all divisions to closely monitor expenditures. The Municipal Liquor, Water
Utility, Storm Sewer Utility, and Golf Course Funds also continued to perform well. Although
the Sanitary Sewer Utility Fund showed a strong increase in revenues, the increase in sewer
treatment charges continued to exceed the increase in rates. For 1995, sanitary sewer rates
were increased substantially to cover the estimated treatment charges. The ice arena,
swimming pool, and special facilities operations will be carefully monitored in 1995 to market
the facilities and control costs.
•
CITY OF RICHFIELD, MINNESOTA
GENERALFUND
COMPARATIVE BALANCE SHEET
December 31, 1994 and 1993
ASSETS
Cash and investments
Receivables:
Taxes
Special assessments
Accounts
Due from component unit
Due from other governments
Total Assets
1994
$ 4,166,211
39,575
3,765
53,440
2,188
84,877
$ 4,350,056
FORM F
1993
$ 3,763,208
117,431
10,460
57,286
2,719
79,095
$ 4,030,199
LIABILITIES AND FUND BALANCE
Liabilities:
Accounts payable
Accrued salaries and employee benefits payable
Due to component unit
Due to other governments
Deferred revenue
$ 97,233
1,078,940
261,287
122,229
19,724
$ 69,400
1,036,582
81,000
130,705
97,465
Total Liabilities
Fund Balance:
Unreserved:
Designated for state aid reductions
Designated for working capital
Total Fund Balance
Total Liabilities and Fund Balance
1,579,413 1,415,152
274,214
2,496,429
2,770,643
$ 4,350,056
263,721
2,351,326
2,615,047
$ 4,030,199
CITY OF RICHFIELD, MINNESOTA
GENERALFUND
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCE - BUDGET AND ACTUAL
December 31, 1994 and 1993
1994
Revenues:
Taxes
Licenses and permits
Intergovernmental revenue
Charges for services
Fines and forfeits
Miscellaneous revenues
Total Revenues
U
Expenditures:
General government
Administrative services
Public safety
Community development
Community services
Total Expenditures
Excess (Deficiency) of Revenues
over Expenditures
155,596 242,997
Other Financing Sources (Uses):
Operating transfers in:
Enterprise Funds 149,970 149,970 146,040
Internal Service Funds 63,700 18,483 (45,217) 2,400
Transfers to Component Unit (475,000) (475,000)
Net Other Financing Sources (Uses) 213,670 (306,547) (520,217) 148,440
Excess of Revenues and Other
Sources Over Expenditures and
Other Uses
Fund Balance - January 1
Equity Transfer In
Equity Transfer Out
0 Fund Balance - December 31
Over
Final (Under) 1993
Budget Actual Budget Actual
$ 5,075,700 $ 5,111,846 $ 36,146 $ 4,838,924
422,000 557,755 135,755 385,361
5,419,600 5,422,353 2,753 5,341,432
780,370 805,419 25,049 782;307
204,480 163,857 (40,623) 165,128
87,670 94,171 6,501 131,273
11,989,820 12,155,401 165,581 11,644,425
626,750 533,414 (93,336) 494,098
916,570 897,825 (18,745) 812,960
6,584,020 6,407,188 (176,832) 6,191,696
250,360 210,247 (40,113) 271,175
3,825,790 3,644,584 (181,206) 3,779,939
12,203,490 11,693,258 (510,232) 11,549,868
(213,670) 462,143 675,813 94,557
155,596
2,615,047 2,615,047
FORM F-1
2,504,391
14,659
(147,000)
$ 2,615,047 $ 2,770,643 $ 155,596 $ 2,615,047
CITY OF RICHFIELD, MINNESOTA
GENERALFUND
SCHEDULE OF REVENUES COMPARED TO BUDGET (Continued)
For Year Ended December 31, 1993
With Comparative Actual Amounts for the Year Ended December 31, 1993
Taxes:
Current ad valorem
Fiscal disparities
Total Taxes
Licenses and Permits:
Business licenses
Nonbusiness licenses and permits
Total Licenses and Permits
1994
Over
Final (Under)
Budget Actual Budget
$ 3,948,126
1,127,574
$ 3,984,272 $
1,127,574
/ 2?°
FORM F-2
1993
Actual
36,146 $ 3,790,816
1,048,108
5,075,700 5,111,846. 36,146 4,838,924
162,000 170,369 8,369 155,560
260,000 387,386 127,386 229,801
422,000 557,755 135,755 385,361
Intergovernmental Revenues:
Federal -
• Civil defense reimbursement 5,000 5,000 7,624
State:
Local government aid 3,169,000 3,169,487 487 3,106,255
Homestead credit 1,859,900 1,860,841 941 1,835,389
Law officer training 13,000 13,793 793 13,429
State-aid street maintenance 247,700 247,733 33 253,762
County -
Community health services 125,000 125,499 499 124,973
Total. Intergovernmental
Revenue 5,419,600 5,422,353 2,753 5,341,432
Charges for Services:
General Government
Deputy Registrar
Public Safety
Community Development
Community Services
Health
Park and Recreation
Nature Center
Community Center
Total Charges for Services
46,000 67,658 21,658 27,798
280,000 291,860 11,860. 290,509
151,800 170,324 18,524 164,306
4,550 5,621 1,071 6,674
7,000 4,056 (2,944) 8,884
2,000 3,779 1,779 13,671
123,660 101,211 (22,449) 106,618
48,550 40,717 (7,833) 48,747
116,810 120,193 3,383 115,100
780,370 805,419 25,049 782,307
3-7
0
CITY OF RICHFIELD, MINNESOTA
GENERALFUND
SCHEDULE OF REVENUES COMPARED TO BUDGET (Concluded)
For the Year Ended December 31, 1994
With Comparative Actual Amounts for the Year Ended December 31, 1993
1994
Final
Budget
Fines and Forfeits:
Actual
FORM F-2
Over
(Under) 1993
Budget Actual
Municipal court fines $ 200,980 $ 157,328 $ (43,652) $ 158,531
Forfeited bail 2,000 4,416 2,416 4,309
Highway patrol fines 1,500 2,113 613 2,288
Total Fines and Forfeits 204,480 163,857 (40,623) 165,128
Miscellaneous Revenues:
Interest 65,000 75,844 10,844 77,908
Rent 10,670 10,704 34 16,261
Contributions 1,000 1,090 90 13,974
Recovery - damage to City property 6,000 3,045 (2,955) 10,652
Other 5,000 3,488 (1,512) 12,478
Total Miscellaneous Revenues 87,670 94,171 6,501 131,273
Total Revenues $ 11,989,820 $ 12,155,401 $ 165,581 $ 11,644,425
u
13- o"
CITY OF RICHFIELD, MINN ESOTA FORM F-3
GENERALFUND
SCHEDULE OF EXPENDITURES COMPARED TO BUDGET (CONTINUED)
For the Year Ended December 31, 1994
With Comparative Actual Amounts for the Year Ended December 31, 1993
1994
Over
Final (Under) 1993
Budget Actual. Budget Actual
GENERAL GOVERNMENT:
Mayor - Council:
Personal services $ 34,330 $ 34,292 $ (38) $ 34,710
Other services and charges 96,750 104,274 7,524 53,565
Supplies 8,400 5,824 (2,576) 7,843
Total 139,480 144,390 4,910 96,118
Other Agencies:
Share a Home 1,500 1,500 1,500
Senior Outreach Services 6,000 6,000 6,000
Cornerstone Advocacy 3,000 3,000 3,000
Storefront/Youth Action 58,350 58,350 56,650
Senior Inform & Referral 1,800 1,800 2,000
Shared Transportation 3,510 3,510 3,310
South Hennepin Regional
• Planning Agency 14,000 14,000 12,900
Total 88,160 88,160 85,360 _
Human Services:
Personal services 23,410 21,178 (2,232)
Other services and charges 2,910, 3,177 267
Supplies 800 1,163 363
Capital outlay 3,500 312 (3,188)
Total 30,620 25,830 (4,790)
City Manager:
Personal services 98,550 107,160 8,610 111,340
Other services and charges 23,050 22,148 (902) 42,582
Supplies 4,800 3,666 (1,134) 4,415
Total 126,400 132,974 6,574 158,337
Legal:
Other services and charges 242,070 141,778 (100,292) 154,190
Supplies 20 282 262 ' 93
Total 242,090 142,060 (100,030) 154,283
Total General Government 626,750 533,414 (93,336) 494,098
CITY OF RICHFIELD, MINNESOTA FORM F-3
GENERALFUND
SCHEDULE OF EXPENDITURES COMPARED TO BUDGET (CONTINUED)
For the Year Ended December 31, 1994
With Comparative Actual Amounts for the Year Ended December 31, 1993
1994
Over
Final (Under) 1993
Budget Actual Budget Actual
ADMINISTRATIVE SERVICES:
Administration:
Personal services $ 79,330 $ 81,932 $ 2,602 $ 90,637
Other services and charges 36,190 37,371 1,181 9,924
Supplies 4,910 4,406 (504) 4,357
Total 120,430 123,709 3,279 104,918
Finance:
Personal services 126,340 130,794 4,454 130,665
Other services and charges 34,290 26,710 (7,580) 30,386
Supplies 11,700 10,982 (718) 11,520
Capital outlay 500 531 31
Total 172,830 169,017 (3,813) 172,571
Personnel:
Personal services
39,510 39,812
302
36,708
Other services and charges 26,030 15,350 (10,680) 14,928
Supplies 8,720 4,593 (4,127) 8,819
Total 74,260 59,755 (14,505) 60,455
Youth Employment - Counseling:
Personal Services 26,280 19,816 (6,464) 25,854
Other services and charges 940 841 (99) 912
Supplies 1,280 617 (663) 656
Total 28,500 21,274 (7,226) 27,422
City Clerk:
Personal services 205,200 196,789 (8,411) 189,756
Other services and charges 20,790 21,791 1,001 21,397
Supplies 9,500 9,532 32 7,482
Total 235,490 228,112 (7,378) 218,635
Election:
Personal services 53,530 51,264 (2,266) 11,214
Other services and charges 4,850 4,155 (695) 2,791
Supplies 8,600 14,339 5,739 1,873
Total 66,980 69,758 2,778 15,878
is
I3 /o
CITY OF RICHFIELD, MINN ESOTA FORM F-3
• GENERALFUND
SCHEDULE OF EXPENDITURES COMPARED TO BUDGET (CONTINUED)
For the Year Ended Decembe r 31, 1994
With Comparative Actual Amounts for the Year Ended December 31, 1993
1994
Over
Final (Under) 1993
Budget Actual Budget Actual
ADMINISTRATIVE SERVICES; (Continued)
Assessing:
Personal services $ 52,170 $ 52,577 $ 407 $ 48,726
Other services and charges 163,160 171,942 8,782 159,845
Supplies 2,750 1,681 (1,069) 4,510
Total 218,080 226,200 8,120 213,081
Total Administrative Services 916,570 897,825 (18,745) 812,960
PUBLIC SAFETY:
Administrative Support Services:
Personal services 237,220 245,590 8,370 215,409
Other services and charges 264,140 253,016 (11,124) 253,773
Supplies 1,000 4,057 3,057 1,582
• Capital outlay
Total 500
502
860
502
663 (500)
(197)
470
764
, , ,
Police Protection:
Personal services 2,383,100 2,351,505 (31,595) 2,320,077
Other services and charges 392,420 373,180 (19,240) 341,126
Supplies 33,380 27,028 (6,352) 23,716
Capital outlay 17,070 13,772 (3,298)
Total 2,825,970 .2,765,485 (60,485) 2,684,919
Fire Protection:
Personal services 1,625,720 1,636,235 . 10,515 1,686,713
Other services and charges 123,780 102,203 (21,577) 100,121
Supplies 22,560 .20,006 (2,554) 27,436
Capital outlay 28,500 2,125 (26,375) 15,393
Total 1,800,560 1,760,569 (39,991) 1,829,663
Police Ancillary Services:
Personal services 733,450 730,286 (3,164) 696,123
Other services and charges 356,210 309,443 (46,767) 181,471
Supplies 33,200 31,637 (1,563) 32,699
Capital outlay 1,800 3,491 1,691 6,057
Total 1,124,660 1,074,857 (49,803) 916,350
? x-11
CITY OF RICHFIELD, MINNESOTA FORM F-3
•
SCHEDULE O GENERALFUND
F EXP
NDIT
R
E
URES COMPA
ED TO BUDGET (CONTINUED)
For the Year Ended Decembe r 31, 1994
With Comparative Actual Amounts for the Year Ended December 31, 1993
1994
Over
Final (Under) 1993
Budget Actual Budget Actual
PUBLIC SAFETY: (Continued)
Inspection:
Personal services $ 260,740 $ 251,826 $ (8,914) $ 253,340
Other services and charges 15,130 9,274 (5,856) 8,614
Supplies 2,100 2,646 546 2,042
Capital outlay 2,400 1,594 (806) 380
Total 280,370 265,340 (15,030) 264,376
Emergency Services:
Personal services 11,750 10,947 (803) 5,980
Other services and charges 18,800 12,409 (6,391) 9,783
Supplies 7,750 7,268 (482) 7,496
Capital outlay 11,300 7,650 (3,650) 2,365
Total 49,600 38,274 (11,326) 25,624
r. Total Public Safety 6,584,020 6,407,188 (176,832) 6,191,696
COMMUNITY DEVELOPMENT:
Administration:
Personal services 79,930 69,784 (10,146) 100,495
Other services and charges 19,630 17,922 (1,708) 5,585
Supplies 2,130 1,051 (1,079) 2,013
Capital outlay 2,076
Total 101,690 88,757 (12,933) 110,169
Planning and Zoning:
Personal services 112,330 100,111 (12,219) 108,790
Other services and charges 23,600 10,646 (12,954) 7,164
Supplies.. 8,700 7,090 (1,610) 10,812
Capital outlay 700 700
Total 145,330 118,547 (26,783) 126,766
Housing Authority:
Personal services (4,980) (5,139) (159) 32,419
Other services and charges 8,120 8,082 (38) 1,220
Supplies 200 (200) 109
Capital outlay 492
Total 3,340 2,943 (397) 34,240
Total Community Development 250,360 210,247 (40,113) 271,175
/3
CITY OF RICHFIELD, MINNESOTA FORM F-3
GENERALFUND
SCHEDULE OF EXPENDITURES COMPARED TO BUDGET (CONTINUED)
For the Year Ended December 31, 1994
With Comparative Actual Amounts for the Year Ended December 31, 1993
1994
Over
Final. (Under) 1993
Budget Actual Budget Actual
COMMUNITY SERVICES:
Administration:
Personal services $ 193,600 $ 206,431 $ 12,831 $ 249,223
Other services and charges 50,890 47,538 (3,352) 39,115
Supplies 5,030 3,512 (1,518) 5,055
Total 249,520 257,481 7,961 293,393
Community Center:
Personal services
Other services and charges
Supplies
Capital outlay
Total
. Recreation:
Personal services
Other services and charges
Supplies
Capital outlay
Total
Nature Center:
Personal services
Other services and charges
Supplies
Total
Forestry:
Personal services
Other services and charges
Supplies
Capital outlay
Total
301,010 295,216 (5,794) 280,723
91,010 88,433 (2,577) 80,959
35,550 37,230 1,680 31,636
1,486 1,486
427,570 422,365 (5,205) 393,318
259,370 227,710 (31,660) 240,014
75,360 65,166 (10,194) 72,309
30,180 34,166 3,986 47,100
332 332 333
364,910 327,374 (37,536) 359,756
249,530 244,444 (5,086) 235,155
56,240 51,737 (4,503) 45,234
14,910 11,697 (3,213) .11,307
320,680 307,878 (12,802) 291,696
114,030 116,592 2,562 116,221
100,990 100,338 (652) 103,850
4,750 5,313 563 5,749
9,100 8,999 (101) 7,902
228,870 231,242 2,372 233,722
is
CITY OF RICHFIELD, MINNESOTA FORM F-3
• GENERALFUND
SCHEDULE OF EXPENDITURES COMPARED TO REVENUES (CONCLUDED)
For the Year Ended December 31, 1994
With Comparative Actual Amounts for the Year Ended December 31, 1993
1994
Over
Final (Under) 1993
Budget Actual Budget Actual
COMMUNITY SERVICES: (Continued)
Lyndale/Nicollet Maintenance:
Personal services
Other services and charges
Supplies
Total
Government Buildings:
Personal services
Other services and charges
Supplies
Capital outlay
Total
Park Maintenance:
Personal services
Other services and charges
Supplies
Capital outlay
Total
Streets:
Personal Services
Other services and charges
Supplies .
Capital outlay
Total
Engineering: .
.Personal services
Other services and charges
Supplies
Capital outlay
Total
Total Community. Services
Total Expenditures
•
$ 750 $ 517 $ (233) $ 480
2,360 363 (1,997) 84.
1,350 2,600 1,250 379
4,460 3,480 (980) 943
175,720 189,458 13,738 157,049
14,960 10,391 (4,569) 142,433
23,500 24,843 1,343 20,482
12,770 10,146 (2,624)
226,950 234,838 7,888 319,964
483,830 474,949 (8,881) 517,095
192,800 224,541 31,741 180,702
66,940 51,954 (14,986) 59,980
2,093 2,093 7,246
743,570 753,537 9,967 765,023
387,630 375,088 (12,542) 401,178
660,820 539,570 (121,250) 520,510
90,290 103,131 12,841- 103,729
4,995
1,138,740 1,017,789 (120,951) 1,030,412
50,910 41,662 (9,248) 69,790
63,430 44,069 (19,361) 18,747
3,880 2,869 (1,011) 3,175
2,300 (2,300)
120,520 88,600 (31,920) 91,712
3,825,790 3,644,584 (181,206) 3,779,939
$ 12,203,490 $ 11,693,258 $ (510,232) $ 11,549,868
CITY OF RICHFIELD, MINNESOTA EXHIBIT J
• MUNICPAL LIQUOR FUND
COMPARATIVE SCHEDULE OF REVENUES AND EXPENSES BY STORE
For the Years Ended December 31, 1994 and 1993
All Stores
1994 1993
Sales $ 6,838,300 $6,753,108
Cost of Sales
Inventory, January 1 368,617 402,427
Purchases 51354,018 5,260,423
Total Merchandise Available for Sale 5,722,635 5,662,850
Less: Inventory, December 31 389,461 368,617
Cost of Sales 5,333,174 5,294,233
Gross Profit on Sales 1,505,126 1,458,875
. Percentage of Gross Profit to Sale 22.0% 21.6%
Less: Operating Expenses 867,642 864,400
Operating Income Before Depreciation 637,484 594,475
Less: Depreciation 58,845 60,373
Operating Income 578,639 534,102
Nonoperating Revenue (Expennes)
Interest - investments 54,042 58,818
Commissions 21,124 31,810
Miscellaneous 6,000 30
Bad Checks (9,212) (17,284)
Cash long (short) (739) 430
Total Nonoperating Revenue (Expenses) 71,215 73,804
Net Income Before Operating Transfers $ 649,854 $ 607,906
l3
•
CITY OF RICHFIELD, MINNESOTA
EXHIBIT J
•
Lyndale Store Cedar Store Penn Store
1994 1993 1994 1993 1994 1993
$ 2,439;280 $ 2,419,846 $ 2,474,477 $ 2,429,408 $ 1,924,543 $ 1,903,854-
130,017 133,755 143,434 144,289 95,166 124,383
1,880,813 1,867,852 1,944,991 1,923,262 1,528,214 1,469,309
2,010,830 2,001,607 2,088,425 2,067,551 1,623,380 1,593,692
122,119 130,017 151,708 143,434 115,634 95,166
1,888,711 1,871,590 1,936,717 1,924,117 1,507,746 1,498,526
550,569, 548,256 537,760 505,291 416,797 405,328
22.6% 22.7% 21.7% 20.8% 21.7% 21.3%
298,768 296,795 300,541 289,720 268,333 277,885
251,801 251,461 237,219 215,571 148,464 127,443
20,187 22,137 28,697 28,590 9,961 9,646
231,614 229,324 208,522 186,981 138,503 117,797
18,014 19, 606 18,014 19,606 18,014 19,606
6,419 8,790 11,722 17,491 2,983 5,529
2,000 30 2,000 2,000
(2,871) (8,634) (4,278) (5,776) (2,063) (2,874)
(621) (175) (62) .311 (56) 294
22,941 19,617 27,396 31,632 20,878 22,555
$ 254,555 $ 248,941 $ 235,918 $ 218,613 $ 159,381 $ 140,352
0
lv-? ?o
CITY OF RICHFIELD, MINNESOTA EXHIBITJ-1
MUNICPAL LIQUOR FUND
COMPARATIVE SCHEDULE OF REVENUES AND EXPENSES BY STORE
For the Years Ended December 31, 1994 and 1993
•
Personal Services:
Salaries - regular employees
City contribution to PERA and FICA
Hospitalization and insurance
Total Personal Services
Other Services and Charges:
Rents and leases
Advertising and publication
Maintenance and repair
Expert and professional services
Communication and travel
Subscriptions and membership
Utilities
Insurance, bonds taxes, and licenses.
Other contractual services
Total Other Services and Charges
Supplies:
Office supplies
Small tools and minor equipment
General supplies
Total Supplies
Total Operating Expenses Excluding Depreciation
Depreciation:
Total Operating Expenses Including Depreciation
. All Stores
1994 1993
$ 517,207 $ 504,652
51,967 53,181
46,940 45,174
616,114 603,007
.30,307 26,594
33,120 32,391
5,954 5,080
8,574 11,271
7,765 6,542
1,083 1,178
35,676 31,368
75,739 90,111
30,663 29,561.
228,881 234,096
1,639 2,246
15,841 20,121
5,167 4,930
22,647 27,297
867,642 864,400
58,845 60,373
$ 926,487 $ 924,773
0
13-0
CITY OF RICHFIELD, MINNESOTA EXHIBITJ-1
0
Lyndale Store Cedar Store Penn Store
1994 1993 1994 1993 1994 1993
$ 176,026 $ 170,523 $ 177,590 $ 170,028 $ 163,591 $ 164,101
17,625 18,036 17,799 17,707 16,543 17,438
14,582 14,383 17,851 13,843 14,507 16,948
208,233 202,942 213,240 201,578 194,641 . 198,487
10,174 8,876 10,081 8,943 10,052 8,775
11,018 10,822 11,162 10,823 10,940 10,746
467 846 4,130 2,190 1,357 2,044
2,788 3,897 2,893 3,687 2,893 3,687
2,647 2,287 2,631 2,365 2,487 1,890
361 392 361 393 361 393
15,463 13,508 11,620 10,043 8,593 7,817
29,422 34,701 25,172 281722 21,145 26,688
9,889 9,849 11,487 11,132 9,287 8,580
82,229 85,178 79,537 78,298 67,115 70,620
537 692 528 1,082 574 472
5,512 6,516 5,336 6,880 4,993 6,725
2,257 1,467 1,900 1,882 1,010 1,581
8,306 8,675 7;764 9,844 6,577 8,778
298,768 296,795 300,541 289,720 268,333 277,885
20,187 22,137 28,697 28,590 9,961 9,646
$ 318,955 $ 318,932 $ 329,238 $ 318,310 $ 278,294 $ 287,531
•
•
CITY OF RICHFIELD, MINNESOTA
MUNICIPAL LIQUOR FUND
COMPARATIVE BALANCE SHEET
December 31, 1994 and 1993
ASSETS
Current Assets:
Cash and cash equivalents
Accounts receivable
Inventory
Total Current Assets
Property and Equipment:
Land
Buildings
Office Equipment
Machinery and equipment
Other improvements
Less accumulated depreciation
Net Property and Equipment
Total Assets
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable
Accrued salaries and employee benefits payable
Due to other governments
Total Current Liabilities
Equity -
Retained earnings:
Reserved for capital improvement
Unreserved
Total Retained Earnings
Total Liabilities and Equity
r
/13-/9
FORM J-5
1994 1993
$ 997,118 $ 879,866
9,294 2,804
389,461 368,617
1,395,873 1,251,287
273,188 273,188
1,058,396 1,058, 396
17,031 17,031
313,928 317,268
67,513 57,706
1,730,056 1,723,589
758,334 707,129
971,722 1,016,460
$ 2,367,595 $ 2,267,747
$ 3,700 $ 3,843
65,709 67,032
69,323 67,893
138,732 138,768
330,000 330,000
1,898,863 1,798,979
2,228,863 2,128,979
$ 2,367,595 $ 2,267,747
CITY OF RICHFIELD, MINNESOTA FORM J-6
MUNICIPAL LIQUOR FUND
COMPARATIVE STATEMENT OF REVENUES, EXP ENSES, AND
CHANGES IN RETAINED EARNINGS
For the Years Ended December 31, 1994 and 1993
1994 1993
Operating Revenues:
Sales $ 6,838,300 $ 6,753,108
Less cost of sales (5,333,174) (5,294,233)
Net Operating Revenues 1,505,126 1,458,875
Operating Expenses:
.Personal services 616,114 603,007
Other services and charges 228,881 234,095
Supplies 22,647 27,297
Depreciation 58,845 60,374
Total Operating Expenses 926,487 924,773
Operating Income 578,639 534,102
Nonoperating Revenues:
Interest 54,042 58,818
Commissions 21,124 31,810
Other expenses (3,951) (16,824)
Net Nonoperating Revenues 71,215 73,804
Income Before Operating Transfers 649,854 607,906
Operating Transfers Out,
General Fund (149,970) (146,040)
Contributions - Liquor Store Fund (400,000) (500,000)
erating Transfers Out
Total O (549,970) (646,040)
p
Net Income (Loss) 99,884 (38,134)
Retained Earnings - January 1 2,128,979 2,167,113
Retained Earnings - December 31 $ 2,228,863 $ 2,128,979
.J
CITY OF.RICHFIELD, MINNESOTA
WATER UTILITY FUND
COMPARATIVE BALANCE SHEET
December 31, 1994 and .1993
ASSETS
Current Assets:
Cash and cash equivalents
Receivables -
Service charges:
Billed
Certified to County Auditor
Unbilled services
Inventory
Total Current Assets
Property and Equipment:
Land
Buildings
Office Equipment
Machinery and equipment
Other improvements
1994
/3-3-0
FORM J-7
1993
$ 595,401 $ 2,061,650
356,306 324,120
118,623 128,274
214,555 217,313
14,602 4,61.3
1,299,487 2,735,970
Less accumulated depreciation
Net Property and Equipment
Total Assets
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable
Contracts payable
Accrued salaries and employee benefits payable
Due to other governments
Total Current Liabilities
Equity:
Contributed capital:
Property owners
Special assessments
City aid for construction
Federal grant
Total Contributed Capital
Retained earnings -
Unreserved
Total Equity
Total Liabilities and Equity
44,500 44,500
1,849,261 1,849,261
13,546 16,513
3,082,085 3,086,773
10,429,603 8,950,580
15, 418, 995 13, 947, 627
5,543,975 5,316,517
9,875,020 8,631,110
$ 11,174,507 $ 11,367,080
$ 122,569 $ 41,490
428,022
64,096 61,729
30,760 51,183
217,425 582,424
533,584 533,584
3,196,500 3,196,500
2,140,118 2,140,118
30,000 30,000
5,900,202 5,900,202
5,056,880 4,884,454
10, 957, 082 10, 784, 656
$ .11,174,507 $ 11,367,080
J 3 -a I
CITY OF RICHFIELD, MINNESOTA
WATER UTILITY FUND
COMPARATIVE STATEMENT OF REVENUES; EXPENSES, AND
CHANGES IN RETAINED EARNINGS
For the Years Ended December 31, 1994 and 1993
FORM J-8
1994 1993
Operating Revenues:
Sales and user-fees
Water availability charges
Customer services
Sales of material and supplies
Certification fees
Penalty charges
Customer service charges
Total Operating Revenues
Operating Expenses:
Personal services
Other services and charges
Supplies
Depreciation
10 Total Operating Expenses
Operating Income (Loss)
Nonoperating Revenues -
Interest
Income (Loss) Before Operating Transfers
Operating Transfers In (Out):
Capital Projects Funds
Transfers from Component Unit
Net Operating Transfers In (Out)
Net Income (Loss)
Retained Earnings - January 1
Retained Earnings - December 31
$ 1,638,755 $ 1,452,516
1,549 1,586
11,619 13,060
6,112 3,935
5,050 4,390
21,618 18,784
73,670 73,616
1,758,373 1,567,887
,683,506 651,808
481,296 361,533
266,399 189,457
235,505 248,757
1,666,706 1,451,555.
91,667, 116,332
38,833 156,100
130,500 272,432
(114,940)
41,926 46,846
41,926 (68,094)
172,426 204,338
4,884,454 4,680,116
$ 5,056,880 $ 4,884,454
9
CITY OF RICHFIELD, MINNESOTA
WATER UTILITY FUND
COMPARATIVE SCHEDULE OF OPERATING EXPENSES
For the Years Ended December 31, 1994 and 1993
1994
w
Treatment and Distribution:
Personal Services:
Salaries
Interdepartmental labor
Retirement contributions
Health and life insurance contributions
Total Personal Services
Other Services and Charges:
Rents and leases
Advertising and publications
Maintenance and repairs
Professional services
Communications
Travel and subsistence
Subscriptions and memberships
Utilities
Insurance, bonds, and permits
Other contractual services
Total Other Services and Charges
Supplies:
Office
Clothing
Parts, tools, and supplies
Chemicals
Total Supplies
Depreciation
Total Treatment and Distribution
Collection and Billing:
Personal Services:
Salaries
Interdepartmental labor
Retirement contributions
Health and life insurance contributions
Total Personal Services
Other Services and Charges:
Rents and leases
Maintenance and repairs
Professional services
Travel and subsistence
Insurance
Total Other Services and Charges
Supplies:
Office
Total Collection and Billing
Total Operating Expenses
$ 416,570
134,615
43,394
46,559
641,138
20,752
4,850
42,460
143,963
5,148
2,410
1,928
171,331
64,186
4,481
461,509
4,535
3,554
37,278
215,791
261,158
235,505
1,599,310
29,953
6,104
3,188
3,123
42,368
15,332
45
3,566
27
817
19,787
5,241
67,396
$ 1,666,706
/3-C) Q,
FORM J-9
1993
$ 416,053
106,835
42,653
46,033
611,574
19,246
346
43,025
36,183
4,303
4,361
232
153,872
62,467
14,751
338,786
3,007
1,806
19,674
158,807
183,294
248,757
1,382,411
28,177
6,018
2,960
3,079
40,234
18,760
45
3,051
75
816
22,747
6,163
69,144
$ 1,451,555
/3-r?)3
CITY OF RICHFIELD, MINNESOTA FORM J-10
SEWER UTILITY FUND
COMPARATIVE BALANCE SHEET
December 31, 1994 and 1993
1994 1993
ASSETS
Current Assets:
Cash and cash equivalents $ 1,822,063 $ 1,896,144
Receivables:
Accounts 2
Service charges -
Unbilled services 285,664 262,269
Total Current Assets 2,107,727 2,158,415
Long-Term Assets:
Due from other governments-
Metropolitan Council Wastewater Services:
Operating cost adjustment (1994 and 1993) (119,088) (218,180)
Reserve capacity 2,863 6,901
Interceptor acquisition contract 592,274 697,419
Total Long-Term Assets 476,049 486,140
Property and Equipment:
Land 9,050 9,050
Buildings 479,245 479,245
Office Equipment 11,858 10,414
Machinery and equipment 183,042 181,923
Other improvements 65,455 65,455
748,650 746,087
Less accumulated depreciation 524,548 490,414
Net Property and Equipment 224,102 255,673
Total Assets $ 2,807,878 $ 2,900,228
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable $ 1,299 $ 3,707
Accrued salaries and employee benefits payable 24,778 21,249
Due to other governments:
Metropolitan Council Wastewater Services:
Interceptor acquisition - current (105,145) (101,101)
Operating cost adjustment (1993 and 1992) 218,180 139,957
Other 5 354
Total Current Liabilities 139,117 64,166
Equity:
Contributed capital -
City
Retained earnings -
Unreserved
Total Equity
Total Liabilities and Equity
131,110 131,110
2,537,651 2,704,952
2,668,761 2,836,062
$ 2,807,878 $ 2,900,228
CITY OF RICHFIELD, MINNESOTA FORM J-11
SEWER UTILITY FUND
COMPARATIVE STATEMENT OF REVENUES, EXPENSES, AND
CHANGES IN RETAINED EARNINGS
For the Years Ended December 31, 1994 and 1993
1994 1993
Operating Revenues:
Sales and user fees $ 1,641,945 $ 1,505,694.
Reserve capacity charges 13,600 3,125.
Sewer certification charges 5,050 4,390
Customer service charges 48,664 48,631
Penalty charges 14,277 12,404
Total Operating Revenues 1,723,536 1,574,244
Operating Expenses:
Metropolitan Council Wastewater Services-
Sewer service charges
Personal services
Other services and charges
Supplies
Depreciation
Total Operating Expenses
Operating Income (Loss)
Nonoperating Revenues -
Interest:
Deferred current value credit
Reserve capacity
Investments
Total Nonoperating Revenues
Income (Loss) Before Operating Transfers
Operating Transfers In (Out):
Capital Projects Funds
Transfers from Component Unit
Net Operating Transfers In (Out)
Net Income (Loss)
Retained Earnings - January 1
1,579,893
309,656
79,809
39,144
34,133
2,042,635
(319,099)
1,455, 319
283,665
88,500
26,091
30,152
1,883,727
(309,483)
31,941 35,829
126 126
77,805 89,594
109,872 125,549
(209,227) (183,934)
(27,192)
41,926 46,845
41,926 19,653
(167,301) (164,281)
2,704,952 2,869,233
Retained Earnings - December 31 $ 2,537,651 $2,704,952
CITY OF RICHFIELD, MINNESOTA
SEWER UTILITY FUND
COMPARATIVE SCHEDULE OF OPERATING EXPENSES
For the Years Ended December 31, 1994 and 1993
1994 1993
FORM J-12
Sewer Service Charge - Metropolitan Council Wastewater Services -
Treatment charges $ 1,579,893 $ 1,455,319
Maintenance:
Personal Services:
Salaries
Interdepartmental labor
Retirement contributions
Health and life insurance contributions
Total Personal Services
Other Services and Charges:
Rents and leases
Maintenance and repairs
Professional services
Communications
Travel and subsistence
Utilities
Insurance, bonds, and permits
Other contractual services
Total Other Services and Charges
Supplies -
Parts, tools, and supplies
Depreciation
Total Maintenance
Collection and Billing:
Personal Services:
Salaries
Interdepartmental labor
Retirement contributions
Health and life insurance contributions
Total Personal Services
163,665 157,530,
24,750 4,769
16,222 15,317
60,169 62,449
264,806 240,065
28,310
6,871
3,618
2,152
1,241
9,670
17,652
513
. 70,027
33,786
34,133
402,752
31,382
5,868
2,995
4,605
44,850
Other Services and Charges:
Rents and leases
Professional services
Travel and subsistence
Insurance
Total Other Services and Charges
Supplies:
Office
Total Collection and Billing
0 Total Operating Expenses
5,699
3,125
175
783
782
5,358
59,990
$ 2,042,635
31,412
2,642
8,339
3,019
2,876
8,364
17,497
1,732
75,881
20,881
30,152
366,979
30,527
5,764
3,051
4,258
43,600
8,630
3,006
202
781
12,619
5,210
61,429
$ 1,883,727
l3-a&
CITY OF RICHFIELD, MINNESOTA FORM J-13
STORM SEWER UTILITY FUND
COMPARATIVE BALANCE SHEET
December 31, 1994 and 1993
1994 1993
ASSETS
Current Assets:
Cash and cash equivalents
Receivables -
Service charges -
Unbilled services
Total Current Assets
Restricted Assets -
Cash and cash equivalents for debt service
Property and Equipment:
Office Equipment .
Machinery and equipment
Other improvements
Less accumulated depreciation
Net Property and Equipment
Total Assets
LIABILITIES AND EQUITY
Current Liabilities (Payable from Current Assets):
Accounts payable
Due to other governments
Total Current Liabilities (Payable from Current Assets)
Current Liabilities (Payable from Restricted Assets):
Accrued interest payable
Bonds payable
Total Current Liabilities (Payable from Restricted Assets)
Bonds payable
Total Liabilities
Equity -
Retained earnings -
Unreserved
Total Liabilities and Equity
$ 315,720 $ 444,170
110,295 99,326
426,015 543,496
214,030 199,030
3,205 522
58,151 58,151
3,602,780 3,150,764
3,664,136 3,209,437
678,961 565,048
2,985,175 2,644,389
$ 3,625,220 $ 3,386,915
$ 103,987 $ 5,151
11,363 13,068
115,350 18,219
43,865 45,549
110,000 90,000
153,865 135,549
1,970,000 2,080,000
2,239,215 2,233,768
1,386,005 1,153,147
$ 3,625,220 $ 3,386,915
•
/3-a-7
CITY OF RICHFIELD, MINNESOTA FORM J-14
STORM SEWER UTILITY FUND
COMPARATIVE STATEMENT OF REVENUES, EXPENSES, AND
CHANGES IN RETAINED EARNINGS
For the Years Ended December 31, 1994 and 1993
1994 1993
Operating Revenues:
Charges for services $ 658,989 $ 649,251
Customer service charges 17,233 16,662
Penalty charges 4,895 4,253
Total Operating Revenues 681,117 670,166
Operating Expenses:
Personal services 160,232 170,767
Other services and charges 227,957 139,355
Supplies 24,861 21,349
Depreciation 113,913 113,089
Total Operating Expenses 526,963 444,560
154
154 606
225
,
Operating Income (Loss) ,
Nonoperating Revenues (Expenses):
Interest income 24,551 31,620
Interest expense and fiscal charges (105,846) (130,591)
Net Nonoperating Expenses (81,295) (98,971)
Income Before Operating Transfers 72,859 126,635
Operating Transfers In:
Internal Service - Permanent
Improvement Revolving Fund 160,000
Net Income 232,859 126,635
Retained Earnings - January 1 1,153,147 1,026,512
Retained Earnings - December 31 $ 1,386,006 $ 1,153,147
•
CITY OF RICHFIELD, MINNESOTA
STORM SEWER UTILITY FUND
COMPARATIVE SCHEDULE OF OPERATING EXPENSES
For the Years Ended December 31, 1994 and 1993
Personal Services -
Interdepartmental labor
Other Services and Charges:
Rents and leases
Maintenance and repairs
Professional services
Travel and subsistence
Utilities
Insurance
Other contractual services
Total Other Services and Charges
Supplies -
Office
Parts, tools, and supplies
Total Supplies
Depreciation
Total Operating Expenses
/'3 -Dg
FORM J-15
1994 1993
$ 160,232 $ 170,767
62,870 67,081
572 9,421
155,814 46,740
1,289 1,313
1,717 8,312
4,462 4,476
1,233 2,012
227,957 139,355
5,490 5,155
19,371 16,194
24,861 21,349
113,913 113,089
$ 526,963 $ 444,560
li
•
•
CITY OF RICHFIELD, MINNESOTA
STORM SEWER UTILITY FUND
SCHEDULE OF CHANGES IN ASSETS RESTRICTED
FOR REVENUE BOND DEBT SERVICE
For the Years Ended December 31, 1994 and 1993
1994
Cash and cash equivalents at beginning of year
Cash receipts-
Transfer from operating cash
Cash disbursements:
Principal payments
Interest payments
Fiscal agent fees
Total Cash Disbursements
Cash and cash equivalents at end of year
FORM J-16
1993
$ 199,030 $ 2,264,612-
210,846 271,359
90,000 2,206,350
105,846 129,569
1,022
195,846 2,336,941
$ 214,030 $ 199,030
0
CITY OF RICHFIELD, MINNESOTA
/3-3D
FORM J-17
RECREATION FUND
COMPARATIVE BALANCE SHEET
December 31, 1994 and 1993
ASSETS
Current Assets:
Cash and cash equivalents
Accounts receivable
inventory
Total Current Assets
Property and Equipment:
Land
Buildings
Office Equipment
Machinery and equipment
Other improvements
1994
1993
Less accumulated depreciation
Net Property and Equipment
Total Assets
$ 344,672 $ 354,746
1,217 886
81,579 75,098
427,468 430,730
179,135 179,135
2,275,828 2,027,836
10,807 10,609 .
649,785 633,614
2,197,268 2,373,551
5,312,823 5,224,745
3,233,038 3,087,027
2,079,785 2,137,718
$ 2,507,253 $ 2,568,448
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable $ 11,012 $ 62,789
Loan Payable 2,900
Contracts payable 48,965
Accrued salaries and employee benefits payable 51,407 44,112
Due to other governments .733 885
Total Current Liabilities 66,052 156,751
Loan payable- 23,683
Equity:
Contributed capital -
City
Retained earnings -
Unreserved
Total Equity
Total Liabilities and Equity
1,301,564 1,301,564
1,115, 954 1,110,133
2,417,518 2,411,697
$ 2,507,253 $ 2,568,448
CITY OF RICHFIELD, MINNESOTA FORM J-18
RECREATION FUND
COMPARATIVE STATEMENT OF REVENUES, EXPENSES, AND
CHANGES IN RETAINED EARNINGS
For the Years Ended December 31, 1994 and 1993
1994 1993
Operating Revenues:
User fees
Sales of merchandise and concessions
Less cost of sales
Total Operating Revenues
Operating Expenses:
Personal services
Other services and charges
Supplies
Depreciation
Total Operating Expenses
Operating Income (Loss)
$ 1,594,164 $ .1,483,930
282,749 251,294
(91,181) (75,913)
1,785,732 1,659,311
993,899 923,498
396,773 361,948
147,477 154,847
159,001 135,763
1,697,150 1,576,056
88,582 83,255
Nonoperating Revenues (Expenses):
Operating Transfers
Operating Transfers In (Out):
Special Revenue - Cable Television Fund
Internal Service - Permanent Improvement Revolving Fund
Net Operating Transfers In (Out)
Net Income (Loss)
Interest income
Other
Total Nonoperating Revenues
Interest Income (Loss) expense ) and fiBeforescal charges
Retained Earnings - January 1
Equity Transfers In (Out)
Retained Earnings December 31
15,863
1,476
17,339
105,921
(100,100)
(100,100)
5,821
28,285
1,579
(490)
29,374
112,629
(99, 000)
(20, 000)
(119,000)
(6,371)
1,110,133 1,126,034
(9,530)
$ 1,115,954 $ 1,110,133
? is
CITY OF RICHFIELD, MINNESOTA FORM J-19
RECREATION FUND
COMPARATIVE SCHEDULE OF OPERATIN
G EXPENSES
For the Years Ended December 31, 1994 and 1993
- 1994 1993
Personal Services:
Salaries $ 653,951 $ 680,922
Interdepartmental labor 231,444 138,919
Retirement contributions 62,937 61,345
Health and life insurance contributions 45,567 42,312
Total Personal Services 993,899 923,498
Other Services and Charges:
Rents and leases 114,045 112,298
Rental of land 14,466 17,591
Advertising and publications 18,876 12,956
Maintenance and repairs 20,700 9,848
Professional services 30,557 34,700
Communications 12,083 5,300
Travel and subsistence 7,806 4,212
Subscriptions and memberships 4,329 3,177
r Utilities 106,763 99,163
Insurance, bonds, and permits 67,148 62,703
Total Other Services and Charges 396,773 361,948
Supplies:
Office 7,232 5,252
Parts, tools, and supplies 140,245 149,595
Total Supplies 147,477 154,847
Depreciation 159,001 135,763
Total Operating Expenses $ 1,697,150 $ 1,576,056
•
3.33
•
•
CITY OF RICHFIELD, MINNESOTA
RECREATION FUND
COMBINING STATEMENT OF REVENUES, EXPENSES, AND
CHANGES IN RETAINED EARNINGS
For the Years Ended December 31, 1994 and 1993
Operating Revenues:
Sales
Sales of merchandise and concession
Less cost of sales
Net Operating Revenues
Operating Expenses:
Personal services
Other services and charges
Supplies
Depreciation
Total Operating Expenses
Operating Income (Loss)
Nonoperating Revenues (Expenses):
Interest income
Loss on sale of assets
Other revenues (expenses)
Interest expense and fiscal charges
Net Nonoperating Revenues (Expenses)
Income (Loss) Before Operating Transfers
Operating Transfers In (Out):
Special Revenue - Cable Television Fund
Internal Service - Permanent Improvement Revolving Fund
Net Operating Transfers In (Out)
Net Income (Loss)
Retained Earnings - January 1
Equity Transfers Out
(47,984) (46,934)
(47,984) (46,934)
(75,493) (103,312)
Retained Earnings - December 31
Ice Arena
Swimming
Pool
$ 230,407 $ 140,804
92,825 18,566
(6,967) (8,441)
316,265 150,929
204,195 137,503
124,407 44,814
25,366 11,923
10,281 3,623
364,249 197,863
(47,984) (46,934)
$ (123,477) $ (150,246)
•
I0
•
FORM J-20
Municipal Special TOTAL
Golf Course Facilities 1994 1993
$ 1,163,547 $ 59,406 $ 1,594,164 $ 1,483, 930
147,246 24,112 282,749 251,294
(65,984) (9,789) (91,181) (75,913)
1,244,809 73,729 1,785,732 1,659,311
617,857 34,344 993,899 923,498
207,206 20,346 396,773 361,948
105,189 4,999 147,477 154,847
127,233 17,864 159,001 135,763
1,057;485 77,553 1,697,150 1,576,056
187,324 (3,824) 88,582 83,255
15,863 15,863 28,285
(136) (136)
1,612 1,612 1,579
0 0 (490)
17;339 17,339 29,374
204,663 (3,824) 105,921 112,629
(100,100) (100,100) (99,000)
0 (20,000)
(100,100) (100,100) (119,000)
104,563 (3,824) 5,821 . (6,371)
1,282,965 5,973 1,110,133 1,126,034
(9,530)
$ 1,387,528 $ 2,149 $ 1,115,954 $ 1,110,133
0
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 9 8
Agenda March 27, 1995
Issue Statement:
Consideration of first reading of a comprehensive revision of the Zoning Code.
/a
Background:
The Planning Commission with the help of staff and the City Attorney's office has been
reviewing and revising the Zoning Code over the past year. A number of issues have
dictated the review including the following:
• The Zoning Ordinance is old with archaic terminology.
• Amendments have been made on a piecemeal basis.
• There are inconsistencies between sections.
• Administration of the ordinance is difficult.
• Site specific provisions hinder consistency.
• New uses force constrained interpretations.
• The format is not easily understood or utilized.
•
•
A comprehensive amendment is being proposed rather than line by line amendment
although such is available for review.
The comprehensive revision of the the Zoning Code was previously distributed at the
March 6 Study Session.
Recommended Motion:
Approve first reading of the comprehensive revision of the Zoning Code and schedule
the public hearing and second reading for April 24, 1995.
Basis of Recommendation:
1. The Planning Commission has comprehensively reviewed the Zoning Code.
2. The proposed changes are extensive but the basic philosophy is unchanged.
3. Sections have been rearranged and graphics added to make the code more user
friendly.
4. Changes are more easily understood and publication is less costly if the old code is
repealed and the new code adopted.
5. The Planning Commission voted unanimously to recommend adoption of the
comprehensive revision of the Zoning Code by the City Council.
Alternative Recommendation:.
1. Table further consideration on the basis that a revision is not needed
2. Refer back to the Planning Commission with instructions for further consideration.
JO-1
Discussion/Decision Mode:
A public hearing and second reading will be scheduled for 7:00 p.m. on April 24, 1995
Respectfully submitted,
Ja a D. Prosser
Cit anager
JDP:cak
0
1.._J
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 9 7
Agenda March 27, 1995
Issue Statement:
Consideration of a resolution authorizing acquisition of 7216 First Avenue to permit the
HRA to proceed with a Hennepin Technical College (Vo-Tech) new construction project
and first reading of an ordinance authorizing sale of the property to the HRA.
Background:
The HRA and the Vo-Tech have developed sites under the Voluntary Acquisition
Program with new housing units for moderate income families for 15 years. HUD rules
require that the City purchase the property and subsequently transfer it to the HRA to
re-sell at the appropriate time. The City would use 1995 federal CDBG funds reserved
in the HRA's New Home budget for this acquisition. City revenues would not be used
for this purchase.
The First Avenue structure is substandard in its size and function and is located at the
back of the lot. The owner, through participation in the Voluntary Acquisition Program,
has stated an interest in selling the property to the HRA. An independent appraiser has
evaluated the property. Staff has negotiated a purchase price at the appraised value of
$43,000 and the HRA at their December meeting, indicated support for purchase at this
price. Upon authorization, the City would enter into a purchase agreement with the
owner to acquire the property with CDBG funds. The City would then sell the property.
to the HRA for $1.00.
It is anticipated that the City could acquire the property by mid-April 1995. Sale of the
property to the HRA could occur by June 8, 1995 if the transitory ordinance is approved
at the May 8, 1995 meeting. The HRA would be responsible for any holding or
maintenance cost incurred at the property after acquisition by the City. Site clearance
and construction would not begin on the site until the property is transferred to the HRA.
Recommended Motion:
It is recommended that the City Council take the following actions:
Adopt the attached resolution which authorizes the City Manager and Mayor to:
A. Enter into a purchase agreement and take other actions necessary to
acquire the property at 7216 First Avenue from the owner, for $43,000.
B. Enter into a sale agreement with the HRA and take other actions
necessary to transfer the property to the HRA for $1.00.
C. Schedule a public hearing and a second reading of the transitory
ordinance to accomplish the sale to the HRA for May 8, 1995.
2. Give first reading to the attached transitory ordinance.
lI-I
Basis of Recommendation:
1. The HRA has identified this property for the New Home Program and authorized staff
to acquire the property.
2. The property owner is interested in selling the property through the Voluntary
Acquisition Program.
3. The property is substandard and qualifies for acquisition in accordance with the
Voluntary Acquisition Program Guidelines.
4. Funds have been budgeted for acquisition, clearance, and maintenance from 1995
federal CDBG funds. The CDBG funds must be utilized for these purposes and to
provide a new home for a moderate income, first-time buying family.
5. Staff is finalizing the preliminary work which would commit this site to a Vo-Tech
construction project in 1995.
6. A finding has been made by the Planning Commission that acquisition and
.disposition of the property is in conformance with the Comprehensive Plan.
7. HUD rules require a process by which the City acquires the property and transfers
the property to the HRA.
• 8. The HRA would like to finalize a development contract with Vo-Tech to initiate the
project during 1995.
9. City owned property requires the adoption of a transitory ordinance to effectuate a
sale.
Alternative Recommendation:
The City can choose not to acquire the property. However, the HRA would not be able
to proceed with a Vo-Tech project in a timely manner. No better property acquisition
site has been identified for the HRA first-time buyer project..
Discussion/Decision Mode:
The sale from the City to the HRA will require a public hearing and second reading of a
transitory ordinance scheduled for May 8, 1995.
Respectfu submitted,
Jame ` Prosser
City Manager
JDP:ds
RESOLUTION NO.
•
THE CITY OF RICHFIELD, MINNESOTA
CALLING FOR ACQUISITION AND A PUBLIC HEARING
ON THE SALE OF CERTAIN LAND
WHEREAS, the City of Richfield, Minnesota (the "City") proposes to sell the real
property to the HRA for $1.00 in furtherance of HRA housing programs; and
WHEREAS, the City has considered the purchase of 7216 First Avenue with
CDBG funds on behalf of the Richfield HRA for $43,000. The property is further
described as:
Address: 7216 First Avenue South
Legal Description:
Lot 5, Block 3, Wooddale Second Addition
Hennepin County, Minnesota; and
WHEREAS, pursuant to the City Charter, Section 13.04, the City is authorized to
sell its Property following a public hearing for which notice was published not less than
ten days before such hearing-
0 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Richfield, Minnesota as follows:
1. The City Manager and Mayor are authorized to take those actions necessary to
purchase 7216 First Avenue for $43,000.
2. The City shall hold a public hearing and second reading of the ordinance
regarding the sale of the land to the HRA on Monday, May 8, 1995.
3. The City Clerk is directed to publish notice of such hearing in the official
newspaper of the City and post notice of said hearing.
Passed by the City Council of the City of Richfield this 27th day of March, 1995.
Martin J. Kirsch, Mayor
ATTEST:
4k Thomas P. Ferber, City Clerk
li-3
TRANSITORY ORDINANCE NO.
AN ORDINANCE AUTHORIZING AND PROVIDING FOR THE SALE, TRANSFER OR
OTHER DISPOSITION AND CONVEYANCE OF CERTAIN CITY OWNED REAL
PROPERTY LOCATED IN THE CITY OF RICHFIELD, COUNTY OF HENNEPIN,
STATE OF MINNESOTA (7216 FIRST AVENUE SOUTH)
The City of Richfield Does Ordain:
Section 1.
The following described real property located in the City of Richfield, Count of
Hennepin, State of Minnesota, is hereby authorized to be sold, transferred or otherwise
disposed of, and conveyed by the City as herein provided:
Lot 5, Block 3, Wooddale Second Addition, Hennepin County, Minnesota,
and having the street address of 7216 First Avenue South, Richfield,
Minnesota.
Section 2.
• The Mayor and City manager are hereby authorized to take all action as is
required to sell, transfer, or otherwise dispose of and convey the real property
described in the foregoing Section 1, including, by way of illustration and not
limitation, the execution of all documents, purchase agreements, deeds of
conveyance, and other instruments connected with such sale, transfer or
disposition and conveyance.
Passed this
Council.
day of , 1995 by the Richfield City
Martin J. Kirsch, Mayor
ATTEST:
Thomas P. Ferber, City Clerk
?7?-
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 9 6
Agenda March 27, 1995
Issue Statement:
Approval of the 1995 Labor Agreement with Richfield Police Supervisory Association.
Background:
City staff has completed negotiations on a Labor Agreement for the year 1995 with the
Richfield Police Supervisory Association, subject to Council approval. The bargaining
unit is represented by Law Enforcement Labor Services (LELS), a statewide police
labor union.
The Richfield Police Supervisory Association represents the positions of Police Captain,
Lieutenant and Sergeant. There are presently nine employees represented within this
unit. The changes which have been negotiated for the 1995 contract are as follows:
• A pay adjustment of 2% effective January 1, 1995 and 1% on June 1, 1995. this is
similar to other employee groups.
• A $20 increase in the City's contribution for dependent health insurance, for a
maximum of $335 per month.
• A $1 monthly increase in the City's contribution for single dental insurance, for a
maximum of $24 per month.
• A $25 per year increase in the clothing allowance to $495 per employee per year.
• A provision which provides an additional day of vacation beginning in the 20th year
of employment, from 160 hours to 168 hours per year.
• A provision which would increase the maximum Personal Leave accrual rate from
1.85 hours to 2.0 hours biweekly.
Recommended Motion:
Adopt a resolution approving a labor agreement with the Richfield Police Supervisory
Association for the year 1995.
Basis for Recommendation:
1. Wage and benefits settlements are comparable to other City of Richfield employee
groups.
2. The union members have voted on the issues and have given their approval to the
settlement.
• 3. The settlement proposal appears to be an equitable resolution of the contract for
both parties.
Alternative Recommendation:
Do not approve the labor agreement requiring further negotiations and/or arbitration.
Discussion/Decision Mode:
In order to allow the City's accounting personnel to modify payroll records and enact the
new pay grades retroactive to January 1, 1995 as quickly as possible, it is
recommended that the City Council act on March 27, 1995 to adopt the attached
resolution providing for the contract implementation effective January 1, 1995.
Respectfully submitted,
Jam D. Prosser
City Manager
JDP:ds
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0 RESOLUTION NO.
RESOLUTION APPROVING LABOR AGREEMENT
BETWEEN THE CITY OF RICHFIELD
AND THE RICHFIELD POLICE SUPERVISORS BARGAINING UNIT LOCAL 162
FOR THE YEAR 1995
WHEREAS the City Manager and the Richfield Police Supervisory Bargaining
Unit Local 162 have reached a complete understanding concerning rates of pay, hours
and other terms and conditions of employment for the year 1995; and
WHEREAS the personnel ordinance requires that contracts between the City
and the Exclusive Representative of employees in an appropriate bargaining unit shall
be implemented by Council resolution.
NOW, THEREFORE BE IT RESOLVED that the City Council does hereby
approve the labor agreement between the City of Richfield and the Richfield Police
Supervisory Bargaining Unit for the year 1995 and orders the provisions of the labor
agreement to be implemented upon signature of the labor agreement referenced herein
by representatives of both the Richfield Police Supervisory Unit and the City of Richfield
• to be effective January 1, 1995.
Adopted by the City Council of the City of Richfield, Minnesota this 27th day of March,
1995.
Martin J. Kirsch Mayor
ATTEST:
Thomas P. Ferber City Clerk
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MEMORANDLN OF CONTRACT
BE'IWEE N THE CITY OF RIC MELD
AMID
THE RICMELD FOLICE SUPERVISORS
AFFILIATED WITH LAW EN?NIEN'P LABOR SERVICE
LOCAL 162
. FOR THE PERIOD
JANLMRY 1, 1995 TO DDCEMBIIZ 31, 1995
0
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TABLE OF CONTENTS
Article Subject _Page
1 Preamble and Statement of Purpose 1
2 Definitions 1
3 Reoognition 2
4 Local. 162 Security 2
5 H]nplayer Security 3
6 Dnployer Authority 3
7 Discipline 4
8 Grievanoe Prooedure 4
9 Warm Schedule 8
10 health Fitness Program 9
11 Injury-On-Duty Leave 9
12 Vacation Leave 10
13 Holiday Leave 12 •
14 Persornzl Leave 13
15 Bereavement Leave 14
16 Overtime Pay 14
17 Insurance 15
18 Tuition Reimbursement 16
19 Clothing Allowance 16
20 Seniority Vacation Rights and Assigrments 16
21 Safety a 16
22 Drug Testing Policy 16
23 Savings Clause 17
24 Contract Arbitration 17
25 Salary Schedule 18
m,
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26 Bal
x
reemmt an
aiver o
Complete A
27 Terms of the Agreemmt 19
28 APPENDIX al
D E 43RANDLIM OF CO NTRAC,T
BETWEEN THE CITY OF RICHFIELD
AND
THE RICHFIELD POLICE SUPERVISORS,UNIT
AFFILIATED WITH LAW ENFORCEMENT LABOR SERVICES, LOCAL 162
ARTICLE 1 - PREAME AND STATE 4T OF PURPOSE
This Agreement is made and entered into this day of March,
1995 by and between the City of Richfield (hereinafter referred to as the
Eknplcyer) and the Richfield Police supervisors unit (hereinafter
referred to as Local 162). The intent and purpose of this Agreement is to:
1. Provide an orderly procedure for the resolution of disputes
cothc.rning this Agreement's intierpretation and/or application;
2. To set forth herein the full and complete understanding of the
parties concerning rates of pay, hours and other oonditicns of
emplayment for the duration of the Agreement.
•
ARTICLE 2 - DEFIlVITICNS
CQpensatory time is time off granted by the Employer to sergeants for
work performed at the express authorization of the Employer in excess of a
sergeant's regularly scheduled shift, subject to a maximum
Department Head means the Director of Public Safety or his designated
representative.
Division means the Police Division of the Department of Public Safety.
EWarge:rv means a situation or condition so defined by the City of
Richfield.
Empleyee means a supervisory employee who is a member of Local 162.
Employer means the City of Richfield or its designated representative.
Employer Seniority means length of continuous service with the Employer
•
in the Department of Public Safety as a sworn officer.
Jab Classification Seniority means length of service in a job
classification.
1
/ g Inn-cc Break means a thirty (30) minute period during the scheduled shift
during which the Employee remains on continual duty and is responsible for .
assigned duties. •
Overtime meads work performed at the express authorization of Employer in
excess of the Employee's regularly scheduled shift.
Regular Ba.9e Pay means the Employee's monthly rate of pay exclusive of
any longeVIty or overtime pay or any other supplemental pay.
Rest Breaks means two fifteen (15) minute periods during the sdieduled
shift during which the Employee remains on o0[ltinu0uS duty and is responsible
for assigned duties.
Shift means a contaxamus eight (8) to ten (10) hour work period, as
designated on the official divisional schedule.
ARTICLE 3 - RECOGNITION
Section 1: The Employer recognizes Law Enforcement Labor Services, Inc.
as the exclusive bargaining representative under Minnesota Statutes (1971)
Section 179.71, subdivision 3, for the following position classifications:
Police Sergeant, Police Lieutenant and Police Captain.
Section 2: Should there be any dispute as to a new position established
during the life of this Agreement, both parties agree to refer such dispute
to the State Bureau of Mediation Services.
ARTICLE 4 - LOCAL 162 SECLEITY
Section 1: During the life of this Agreement, the Employer agrees to
deduct monthly Local 162 dues for Employees who are members of Local 162 and
who request in writing to have their monthly Local 162 dues che? off. The
Employer shall remit such deduction to the Richfield Police Supervisory local
162 or Law Enforcement Labor Services, Inc. as appropriate.
Section 2: Local 162 agrees to indemnify and hold the Employer
harmless against any and all claims, suits, orders or jtnt bright or
issued against the Employer as a result of any action taken or not taken by
the Employer under the provisions of this Article.
2
Section 3: Not more than one (1) member of Local. 162 Negotiating /O _ 9
Committee may be absent from duty with full pay for negotiation sessions for
the purpose of negotiating terries of an Agreement if such sessions are
scheduled at a time when a team n nber is scheduled to be on duty. Such
absences from work must be approved by the Division Plead and only if the
Division (lead determines the absence would not be detrimental to division work
progiams.
ARTICLE 5 - EMPLOYER SECURITY
Neither Local 162, their officers or agents, nor any. of the
Employees covered by this Agreement, will engage in, encourage, sanction,
support cr suggest any strikes, slowdowns, resignations, absenteeism, the
willful absence from one's position, the stoppage of work or the abstinence in
whole or part of the full, faithful and proper perfarmanoe of the duties of
employment. In the event that any Employee violates this Article, the
Local 162 shall immediately notify any such Employee in writing to cease and
desist from such action and shall instruct the Employee to immediately return
to the Employee's normal duties. Any or all Employees who violate any of the
provisions of this Article may be discharge or otherwise disciplined.
ARTICLE 6 - EMPLOYER ALMICRITY
Section 1: The Local 162 recognizes the prerogative of the Employer to
operate and manage the affairs of the Police Division of the Department of
Public Safety in all- respects in accordance with existing and future laws and
regulations of appropriate authorities, including personnel policies and
division work rules. The prerogatives and authority which the Sriployer has
not officially abridged, delegated or modified by this Agreement are retained
by the Employer, such as, but not limited to: direct Employees, hire, promote,
transfer, assign, retain Employees in positions, and suspend, demote or
discharge or take disciplinary action against Employees, relieve Employees
from duties because of lack of work or other legitimate reasons, maintain the
efficiency of the government operations; determine the methods, means, job
3
classifications and personnel by which such operations are to be c=x]ucted,
take whatever actions may be necessary to carry out the missions of the
Employer in situations of emergency; detezmine reasonable schedules or work
and establish the methods and processes by which work is performed.
Section 2: The Employer's non-exercise of any function hereby reserved
to it, or its exercising any such function in a particular way shall not be
deemed a waiver of its right to exercise such function or preclude the
Employer the express provisions of this Agreement.
Section 3: The mm eration of the rights and duties of the Employer in
this Agreement shall not be deemed to exclude other inherent t rights
and mar?agenerit functions not expressly delegated in this Agreement are
reserved to the Employer.
ARTICLE 7 - DISCIPLINE
The Employer will discipline Employees only for just cause. The
es of progressive discipline, as stated in the City's Peraonnel
Ordinance, shall be part of this contract.
ARTICLE 8 - GRIEVANCE PROCEDURE
Section 1: Definition of a Grievance. A grievance is defined as a
dispute or disagr?eemerit as to the interpretation or application of the
specific terms and conditions of this agreement. The definition of grievance
may also extend to disciplinary actions involving just cause for suspension,
demotion or dim of permanent employees.
The parties recognizing that an orderly grievance procedure is necessary,
agree that each step must be adhered to as set forth herean or the grievance
is forfeited. All grievances must be filed within twenty-one (21) calendar
days after oaurrerce of the circumstances giving rise to the grievance,
otherwise the right to file a grievance is forfeited and no. grievance shall be
deemed to exist.
Section 2: .The Employer shall recognize stewards selected by
Local 162 as grievance representatives of the bargaining unit. local
4
162 shall notify the Rmployer in writing of the stewards aryl of their f® -l J
oxxmssars when so named. Stewards shall process grievances at times other
0 than during their normal work schedules unless specifically permitted to do so
by the Employer.
Section 3: Procedure. Grievances, as defined in Section 1, shall be
resolved in accordance with the following procedure:
5Agp 1: Within twenty-one (21) calendar days of the occurrence giving
rise to the grievance, the steward shall submit the grievance in
writing to the Director of Public Safety. A meeting between the
Director of Public Safety, or his representative, and the
r.
steward(s) shall be held at a time mutually agreeable to the
parties within ten (10) working days following receipt of the
written report. The Director of Public Safety, or his
representative, shall give a written answer to the steward
within five (5) working days following the meeting-
0 Step 2: If the grievance is not resolved in the first step,
local 162 shall notify the Director of Public Safety in
writing of the desire to appeal within fifteen (15) calendar
days after receipt of the Director's written answer. If such
request is made, the grievance shall be reviewed at a meeting
between the City Manager, or his representative, the steward(s)
and the Director of Public Safety, or his repr+esenttive, within
fifteen (15) working days after receipt by the Director of
Public Safety of the notice of desire to appeal. A written
answer shall be given by the City Manager, or his
representative, within fifteen (15) working days after the date
of the Second Step meeting.
Section 4: Waiver. If a grievance is not presented within the time
limits set forth above, it shall be considered "waived." If a grievance is
not appealed to the next step within the specified time limit or any agreed
5
extension thereof, it shall be considered as settled on the basis of the
/O-/ a
Emplcyer I s last answer. If the Employer does not answer a trievarroe or an
appeal thereof within the specified time limits, Local 162 may elect to 40
treat the grievance as denied at that step and imr?rliately appeal the
grievance to the next step. The time limit in each step may be extended by
mutual written agreement of the Employer and Local 162 representatives
involved in each step. The term "working. days" as used in this Article shall
mean the days Monday through Friday, inclusive.
Section 5: Choice of Remedy. If, as a result of the Employer response,
the grievance remains unresolved, the grievance may be appealed either to the
procedure of Sections 6 and 7 of this Article or a proeedum such as: Civil
ServIce, Veterans' Preference, or Fair Employment. If appealed to any
procedure other than the procedure of Sections 6 and 7 of this Article, the
grievance is not subject to the arbitration procedure as provided, in Sections
6 and 7 of this Article. The aggrieved employee shall indicate in writirq
which procedure is to be utilized-Sections 6 and 7 of Article 8 or another
appeal prooedure--and shall sign a statement to the effect that the choice of
any other hearing precludes the aggrieved Employee from making a subsequent
appeal through Sections 6 and 7 of Article 8.
Section 6• If both parties, having exhausted the grievance steps
provided herein, cannot settle a grievance, either party may submit the issue
in dispute to arbitration as provided in the Public Employment Labor Relations
Act of 1971, as amended.
The issues in dispute may be submitted to a three member board of
arbitration who are members of the American Arbitration Focal 162 National
Panel of Labor Arbitrators with each party appointing one mom er of the
arbitration board and the third member, who shall serve as the neutral
chairman, to be selected aaoordi.ng to the provisions of the Public Employment
Labor Relations Act of 1971, as amended. Each party shall, within seven (7)
calendar days of the notification to proceed to arbitration; appoint one
6
member of the arbitration board. The two members thus cbosen shall endeavor
to select the third membex within seven (7) calendar days who shall serve as
neutral chairman. If the two members cannot agree upon a third AAA arbitrator
within the said seven (7) days, then either party may request the American
Arbitration Association to submit a list of five (5) names from which the
parties shall select a neutral chairman. The parties shall, within seven (7)
days after the receipt of such a list, select the neutral cha **m by striking
alternately one name each and the remaining name shall be chairman Of the
arbitration board. if the parties cannot decide who shall strike the first
name, the party entitled to strife the first name shall be determined by the
toss of a coin. The decision by a majority vote of the arbitration board
shall be final.
Section 7: If the procedure outlined in Section 6 meets with the
objection of either the Employer or Focal 162, a single arbitrator shall be
selected from a list of seven (7) AAA arbitrators provided by the Public
EkTployee Labor Relations Board. If the parties cannot decide who shall strike
the first name, the party entitled to strike the first name shall be
determined by the toss of a coin. The names of the arbitrators shall
alternately be struck until only one name remains. The single arbitrator
shall decide the outcome of the grievance and it shall be binding on the
parties.
Section 8: Authority of Arbitrator or Arbitration Board. The arbitrator
or arbitration board, shall have no right to amend, modify, nullify, ignore,
add to, or subtract from the provisions of this Agreement. The arbitrator or
arbitration board shall consider and decide only the specific issue(s)
submitted to it in writing by the Employer and/or Local 162, and shall have no
authority to make a decision on any other issue not so submitted to it. The
arbitrator or arbitration board shall be without power to make decisions
is contrary to or inconsistent with or modifying or varying in any way the
application of laws and rules and regulations having the forme and effect of
7
law. The arbitrator or, arbitration board shall submit in writing its decision
hearing or the
within thirty (30) calendar days following the close of the
submission of briefs by the parties, whichever is later, unless the parties
agree to an extension thereof. The decision shall be based solely upon the
ariitratorIs or arbitration board's interpretation of the meaning or
application of the express terns of the Agreement to the facts of the
grievance presented.
Section 9: All fees and expenses of the arbitrator or arbitration board
shall be shared equally by the Employer paying one-half of such fees and
expenses and Local 162 paying the other half.
If one party chooses to proceed to arbitration as per Article 8,
Sections 6 and 7, over the objections of the other party, &iditicnal expenses
such as attorney fees, transcripts and other miscellaneous expenses not
jointly requested will be paid by the requesting party.
ARTICLE 9 - WORK SC FMJLE
Section 1: The sole authority in establishing work schedules is the
Employer. The normal work day shall be eight (8) to ten (10) consecutive
hours as designated on the official divisional sd*dule, and the normal work
week shall be an averaged forty (40) hours. Any official divisional work
schedule that is comprised of less than an averaged forty (40) hour work week
will require repayment of hours by members of Local 162 so affected. It
will be the option of each member as to the method employed-in paying back
these hours, subject to approval of the Director of Public Safety or his
sesntative.
repre
Section 2: Service to the public may require the establishment of daily,
weekly, seasonal or annual work schedules which depart from the normal work
day or the normal work week. The Employer shall, except in the case of
emergen y, give the Local 162 notice of such a change in the work schedule
as far in advance as is reasonably practicable.
•
•
•
8
ARTICLE 10 - HEALTH FITNESS PROGRAM
u
Section 1: A voluntary Health Fitness Program is available with the
following provisions:
a. Successfully participates in the voluntary Health
Fitness Program shall mean:
1. Cm pletion and submission to the Department
Training Officer of an individual work log.
2. Minimum of twelve (12) workouts per month following
the Eirployee's exercise Pre-` =iptian-
Section 2: The pay back obligation for.each scheduled period shall be
forgiven for each Employee who successfully participates in the Health Fitness
Program during that period.
Section 3: A successful participant will have the option of converting
seven tenths of an hour (0.7) of sick leave accrual each biweekly payroll
period, credited biannually, consistent with schedule changes (bid period),
into a Health Fitness Holiday Leave bank. This leave may be used at the
participant's discretion in full shift increments, subject to department head
approval. All employees are subject to the maximum Holiday accrual of 96
hours.
ARTICLE 11 - INJURY-M-DLYI'Y LEAVE
Section 1: Employees who areinjured while performing assigned duties
and who qualify for'workers' ocmpensation shall be eligible for injured-on-
duty leave on the same date that the Eh plcyee begins drawing workers'
c:anpensation pay.
Section 2: If the Employee is found to be eligible for Injury-On-Duty
Leave, he shall receive supplementary payments from the Employer equal to the
difference between the total amount of all other Employer injury-related
benefits, i.e. Workers' Caopensation, pension disability benefits, and the
employee's normal net rate of pay, after subtraction of Federal and-State tax
withholding and retirement contributions, for a maximum of ninety (90)
9
hh ((.consecutive calendar days. Such supplementary payments shall not be charged
against the Employee's accrued sick leave.
Section 3: Injury-on-Duty. leave shall extend for a maximum of ninety
(90) consecutive calendar days following the date of %=Rers' oanp ansaticn
eligibility. The Employer may require an injured Employee to be examined by a
physician selected by the Employer in order to determine whether the Employee
is able to return to work pursuant to the provisions of Section 4.
Section 4: Injury-On-Duty leave shall be terminated by the Employer at
such time as a duly qualified physician determines that the Employee is
-- pletely able to perform all, of the duties of the Employer within the job
classification the Employee held prior to injury.
Section 5• In those cases where the Employee sustains injuries of such
severity that it requires more than ninety (90) consecutive calendar days
before the Employee is completely able to perform all of his assigned duties,
the Employer may, at his discretion, extend the ninety (90) day maximum as
referred to in Section, 2 and Section 3.
Section "Normal net rate of pay," as referred to in Section 2, shall
be defined as: "Employee's normal rate of pay minus State, Federal tax
withholding, and retirement contributions off. "
ARTICLE 12 - VACATION LEAVE
Section 1: All Employees shall be eligible for vacation leave, except
that no Employee shall be allowed to use vacation, leave until after the
om pletion of one full year of employment.
Section 2: Employees shall accrue vacation leave aooa--+ding. the
following schedule:
A. From the beginning of continuous employment through the fifth (5th)
year of continuous employment, each Employee shall earn vacation at
the rate of 96 hours per year.
•
•
10
B. After the fifth (5th) year and on through the tents (10th) year of
U
continuous employment, each Employee shall earn vacation at the rate
of 120 hours per year:
c. After the tenth (10th) year and on through the fifteenth (15th) year
of continuous employment, each Employee shall earn vacation at the
rate of 144 hours per year.
D. After the fifteenth (15th) year of continuuous employment, and on,
each Employee shall earn vacation at the rate of 160 hours per year.
E. After the nineteenth (19th) year of continuous employment, each
Employee shall earn vacation at the rate of 168 hours per year.
Section 3: Vacation leave may be accrued up to a maxi? man of 240 hours.
This provision can only be waived if the Director of Public Safety or his
representative provides the Personnel Division written authorization to waive
this maxim n prior to an employee's reaching the mwdman accrual. Employees
shall use vacation leave in the amounts of not less than one hour upon
0 properly filing each leave request with the Personnel Office.
Section 4: In the event an Employee voluntarily terminates his
employment with the Employer or is discharged, he shall be paid for his
aacimaulated vacation hours as of his termination date, provided he has given
two weeks' notice of his termination. Employees who voluntarily terminate
prior to completing ayear of continuous and active city service shall not be
eligible for terminal vacation pay.
Section 5: Department Read Approval. All vacation leave schedules must
be approved by the department head or the designated representative and filed
in the prescribed mariner with the Personnel Office. In approving such
schedules, the department head or the designated representative shall consider
the needs of the municipal service and the seniority and wishes of the
Employee and shall respond to the Employee's request within a reasoroble
length of time.
11
/ ®- /9 ARTICLE 13 HOLIDAY LEAVE
Section 1: Employees shall receive ninety-six (96) hours of holiday
leave per year. Eight (8) hags of holiday leave shall be granted for each
ofthe following eligible holidays: New Year's Day; Martin ;other King's
Birthday (the third Monday in January); Lincoln's Birthday; Washington's
Birthday; Good Friday; Manorial Day (the last Monday in May); Independence Day
(July 4) ; Labor My. (the first Monday in September); Columbus Day (second
Monday in October) ; Veteran's Day (November 11) ; Thanksgiving Day (the fourth
Thursday in November); and Christmas Day (December 25).
Section 2: Holiday leave may be accrued to a maximum of ninety-six (96)
Section 3: Holiday leave may be taken at any time during the year with
the provision that all such leave requests must be approved Iby the department
head or the designated representative. In approving such schedules, the
department head or the designated representative shall consider the needs of
the municipal service and the seniority and Wishes of the Employee and shall
respond to the Employee's request within a reasonable length of time.
Employees shall be charged for the use of holiday leave in the amount of not
less than one (1) hour per occurrence.
Section Sergeants who work at the express authorization of the
Employer, or on a scheduled work shift, after January 1, 1988, shall be
oa sated at time and one half (1 1/2) the Sergeant's regular base rate, in
either aa[?pensatory time or monetary payment, at their, option, subject to the
sixty-four (64) hour maximum aonVelsatory time accixnulation per Employee, for
all hours required to work in addition to the holiday leave granted, for the
following holidays in 1994:
New Year's Day
Lincoln's Birthday
Memorial Day
4th of July
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Labor Day /0-/9
MY
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Christm s IXW
Section In the event an Employee voluntarily terminates his
employment with the Employer or is disoharged, the Employee shall be paid for
the accxamxlated holiday leave hours as of the Employee's termination date,
provided the Employee has given two weeks written notice of his termination.
Employees who voluntarily terminate prior to completing a year of continuous
and active city service shall not be eligible for tendnal holiday leave pay.
Section 6: In the event an Employee terminates his employment with the
Employer or is discharged and has used more holiday leave than accrued at the
date of termination, an adjustment will be made in the Employee's r- g m-L ation
resulting in the Employee being paid only for boliday leave accrued to the
date of termination.
ARTICLE 14 - PERSONAL LEAVE
• Section 1: Personal. leave with pay is granted to all full-time permanent
and full-time probationary employees at the rate of 2.0 hours biweekly, up to
a maxinami 176 b ours. Personal Leave may be used for any reason, and is
required-to be used for illness or injury necessitating absence from work,
except when the employee is eligible for short-term disability or long-term.
disability benefits.
Section 2: All Personal Leave must be approved by the.Department Head or
the designated representative and filed in the prescribed manner with the
Personnel Office. a
Section 3: In the event an employee terminates employment with the
>>ated
Employer in good standing, the employee shall be paid for the
Personal leave hours as of the termination up to a maxnT m of 176 hours.
Section 4: Employees hired or prcmcited into a position covered by the
labor Agreement after 1-1-93, who have aacxued sick leave hours provided by
the City of Richfield, shall have such Yours converted into the provisions of
13
y Article 14 - Personal leave and Article 18 - Insurance, Sections 5 and 6 The
«l.>
eonversien of sick leave fours shall be done in accordance with the contract
attadYnent entitled "CbrYversion. "
Section 5: Payouts to eligible employees for accrued sick leave in
a ccxdanoe with Section 4 shall be paid in one lump sum payment at the
successful om pletien of the probationary period.
ARTICLE 15 BEREAVEMENT LEAVE
The Employer will grant to eligible employees up to a maximum of 16 hairs
of Bereavement Leave for the death of a spouse, parent, child, sibling,
grandparent, grandchild, mother-in-law, father-in-law, brother-in-law or
sister-in-law.
ARTICLE 16 - OVIIRM4E PAY
Section 1: Employees may from time to time be required to perform duties
in excess of their normally, scheduled work shifts. Such assignments may be at
the reasonable discretien of the Employer. Employees shall be required to
perform such work unless excused by the Employer.
section 2:. overtime compensation either in the form oz pay or time off
is not provided for the positions of lieutenant or captain. However, the
department head may grant reasonable periods of time off when the department
head feels such time off is warranted.
Section 3: Sergeants shall be compensated for time worked in excess of
their regularly scheduled shift at the express authcrizatial of the Employer
at time and one-half their regular base rate in either canpensatory time or
monetary payment at their option, subject to a sixty--four (64) hour maximum
oa ?setory time aocxucwlation per sergeant. This maximum 7x, C. ?satory time
accrual maybe waived by the Director of Public Safety on a, case by case basis
5
upon properly filing of such request with the Personnel Office. Change of
shifts within a twenty-four (24) hour period does riot qualify
for overtime.
14'
Section 4 : A sergeant called back to work at a time other than his /(f)-,;2-)
normal scheduled shift shall receive a minimum of two (2) hours overtime pay.
I* - Reporting early for a shift or an extension of a shift shall not qualify for
ARTICLE 17 - INSURANCE
Section 1: Effective January 1, 1995 the Employer shall contribute up to
a maximum of three hundred and thirty-five dollars ($335) per month per
Employee for calendar year 1995, including dependent coverage towards an
Employee health hw anm premium offered by the Employer. The Employer
contribution cannot exceed the cost of individual coverage for Employees
selecting individual coverage.
Section 2: The Employer shall provide the Employee with term life and
accidental death and t one in the amount of $25,000.
Section 3: The &p1cyer shall continue to provide the'Employees with
full false arrest insurance.
i Section 4: The Employer shall contribute up to a maximum of twenty-four
dollars ($24) per month per Employee for calendar year 1995 for individual
coverage of:the Employee toward a group dental insurance premium offered by
the EMPLOYER.
Section 5: The Employer will provide all employees with Short-term
Disability Insurarx3d. Short-term Disability Insurance will accrue to eligible
employees at the rate of two (2) benefit days per month, up. to a maximum of
122 benefit days. Short-term Disability In%lranoe will provide a disability
income for qualifying absences at a rate of 100% of the emplcyee.'s regular
base wage and became effective on the 11th continuous working day of a
qualifying absence and continue up to a maximum of 122 days, or until the
employee's accrued benefit days have been exhausted, whichever occurs first.
An employee shall not be eligible for Short-term Disability Insurance once the
employee has qualified for Long-term Disability Insurance.
15
QD Section 6: The EmPlayer will Provide emplayees with a Lang-term
Disability insurance as selected by the II piDyER. Long-tam Disability
insurance will: become effective after 180 consecutive calendar days of
qualifying absence from work due to disability; be equal to 60$ of the
employee's regular base wage at the time of disability; and will be subject
tointegration with benefits payable by other plans.
ARTICLE 18 - TUITICK EW-IMBURSEMERr
The Employer shall provide the benefits of the Richfield Employee
Educational Program.
ARTICLE 19 - CLOTHING ALLOWMM
The max_iimm clothing allowance will be $495 per year for 1995. This
allowance is for the maintenance, repair and replacement of uniforms and
equipment initially provided by the Employer and for civilian clothing for
those Emplaeees assigned to work in plain clothes.
ARTICLE 20 - SENIORITY VACATIQN RIGHTS AMID ASSIGNMENTS
Section 1: Vacation selection rights shall be determined within work .
groups by job classification seniority, provided requests for vacation leave
are submitted by June 1.
Section 2• The Employer agrees to furnish local 162 with an up-to-date
list every twelve (12) months showing the position classification,
appointment date and length of Conti UXUS service for Employees represented by
Local 162.
ARTICLE 21 - SAFETY
Both the Employer and the Employees agree to maintain sanitpry and safe
working conditions and equipment.
ARTICLE 22 - DRUG TESTING POLICY
The Employer and Local 162 agree to the City's implementation of a
mandatory drug testing program for all Employees represented by Local 162.
The Eimplayer and. Local 162 further agree that the policy implemented in said
marydatory drug testing program will be an appendix to this labor agreement.
16
ARTICLE 23 - SAVINGS CLAUSE /0 -a 3
Section 1: This Agreement is subject to the laws of the United States,.,
the State of Minnesota and the signed municipality. In the event any
provision of this Agreement shall be held to be contrary to law by a court of
competent jurisdiction from whose final judgment or decree no appeal has been
taken within the time provided, such provision shall be voided. All other
provisions shall continue-in full. fame and effect. The voided provisien.may
be renegotiated at the request of either party.
ARTICLE 24 - CUMACP ARBITRATION
Section 1: If the Employer and Local 162 are unable to reach an
agreement an a future written contract or menor2it?dwn of o=tract, either
party may submit the issue(s) in dispute to arbitration as provided in the
Public Employment Labor Relations Act of 1971.
If-either party so chooses, the issue(s) in dispute may be submitted to a
three member board of arbitration with each party appointing one member of the
• arbitration board and the third member, who shall serve as the neutral
chairman, to be selected according to the provisions of the Public Employment
Labor Relations Act of 1971.
Section 2: if either party so chooses, the issue(s) in dispute may be
submitted to a panel of three (3) arbitrators whose neutral chairman shall be
a member of the American Arbitration Local 162 National Panel of Labor
Arbitrators. Each party shall, within seven (7) calendar days of the
notification to proceed to arbitration, appoint one (1) member of the
arbitration board. The two (2) members thus chosen shall e'?r to select
the third member within seven (7) calendar days who shall serve as neutral
chairman. If the two (2) members cannot agree upon a third AAA arbitrator
within the said seven (7) days, then either party may request the American
Arbitration Association to submit a list of five (5) names ffrom which the
10 parties shall select a neutral chairman. The parties shall, within seven (7)
17
days after the receipt of such a list, select the neutral chairman by striking
®'°-) 'ternately one (1) name each and the remaining name shall be chairman of the
arbitration board. If the parties cannot: decide who shall strike the first
name, the party entitled to strike the first name shall be determined by the
tx?ss of a coin. The decision by a majority vote of the arbitration board
shall be final and shall be rendered within thirty (30) days from the date of
the arbitration hearing.
Section 3• All fees and expenses of the impartial chairman shall be
shared equally by the Employer paying one-half of such fees and expenses and
the Local 162 paying the other half. If one party chooses to proceed to
arbitration as per Article 24, Section 2 over the objections of the other
party, the party requesting this procedure shall assume the additional
expenses over and above those which nutty might be incurred as per Article
24, Section 1.
ARTICLE 25 - SALARY SCHEDULE
Section 1: The following is the pay schedule to be implemented by the
Employer on January 1, 1995:
Monthly Pay Rates
1 2 3 4
Police Sergeant $3,912.12 $4,056.23 $4,199.05 $4,343.19
Police Lieutenant $4,170.75 $4,324.29 $4,479.27 $4,632.84
Police Captain $4,468.47 $4,632.84 $4,798.52 $4,964.22
Section 2: The following is the pay schedule to be implemented by the
Employer on June 1, 1995:
1
Police Sergeant $3,951.24
Police Lieutenant $4,212.46
Police Captain $4,513.15
Monthly Pay Rates
2 3 4
$4,096.79 $4,241.04 $4,386.62
$4,367.53 $4,524.06 $4,679.17
$4,679.17 $4,846.51 $5,013.86
0
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Section 3 • clonal Progression Thigh Steps
1
Starting
2
3
After 1 Year After 2 Years
4
After 3 Years
ARTICLE 26 - COMPLETE ACREENIQVT AMID WAIVER OF BAFGAINIM
to-Q5
The parties aImowledge that during the negotiations that resulted in
•
this agreement, each had the unlimited right and opportunity to make demands
and proposals with respect to any subject or matter not removed by law from
the area of collective bargaining and that the understandings and ogre -nients
arrived at by the parties after the ejercise of that right and the opportunity
are set forth in this Agreement. However, if a new position classification
should be created which was not foreseeable during negotiations, and if the
Employer, Employees and Bureau of Mediation Services agree and determine that
such position classification should be included in the bargaining unit
otherwise covered by this Agreement, then either the aployer or the
E]plcyee_ may demand that negotiations regarding salaries and overtime
provisions immediately opera up to cover the new position classifications.
Ewept for possible negotiations covering new position classifications as
mentioned above, the Employer and Local 162 for the life of this Agreement
each voluntarily waive the right and each agrees that the other shall not be
obligated to bargain collectively with respect to any subject or matter not.
specifically referred to or covered in this Agreement, even though such
subject or matter may not have been within the knowledge or contemplation of
either or both of the parties at the time of negotiations or signing of this
Agreement.
ARTICLE 27 - TEEM OF THE AGREEMENT
Section 1: This Agreement shall be in force and effect fran. January 1,
1995 thr? December 31, 1995 with regard to all terms and conditions
i Section 2: If either party desires changes in the terms and conditions
of this Agreement for the period beginning January 1, 1996, notification must
19
b?Ie__ made to the other party by June 1,-1995.
/ o?? (o Section 3: In witness thereof, the undersigned have caused this
Agreement to be executed an this
day of Mardi 1995.
FOR THE CITY OF RICEF'IEM
i
FOR THE RIC HF7= POLICE
N
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L_A
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CITY OF RICHFIELD
DATE: February 11, 1991
PERSONNEL POLICY
SUBJECT: Drug and Alcohol Testing
Introduction
APPENDIX
,/D-a7
The purpose of this Personnel Policy is to implement Minnesota
Statute 181, regulating drug and alcohol testing of employees and
job applicants.
Policy
All present employees and all job applicants are subject to drug
and alcohol testing in conjunction with the provisions of
Minnesota Statutes, Sections 181.950-181.957, and the following
provisions:
1. Circumstances Under Which Testing May Occur.
Drug and alcohol testing may
- As part of an employee's r4
the employee will be given
- For all job applicants who
offer of employment.
- Without notice if the City
a current employee:
be requested and required:
squired annual physical for which
at least two weeks notice.
have received a conditional
has a reasonable suspicion that
a. Is under the influence of drugs or alcohol;
Under the Influence shall be determined to be present
if*the employee is perceptibly impaired; has impaired
alertness, coordination, reactions, responses or
effort; if the employee's condition threatens the
safety'of him/herself or others; or if the employee's
condition or behavior presents the appearance of
unprofessional or irresponsible conduct detrimental to
the public's perception of the City as an employer as
determined by the Supervisor or Manager or ethers
observing the employee.
b. Has violated the City's written ordinances, rules, or
policies related to drugs and alcohol;
c. Has sustained or caused another person to sustain a
personal injury; or
d. Has caused a work related accident or was operating or
helping to operate machinery, equipment, or vehicles
involved in a work related accident.
2. Random Testing and Testing Without Prior Notice.
/()-a g Random testing without prior notice may be given to those
.employees who are charged with supervising or managing either
the Special Services Unit or Special Investigations Unit.
Testing without prior notice may be given employees who have
been referred by the employer for chemical dependency
treatment or evaluation or who are participating in a
chemical dependency treatment program under an employee
benefit plan or have participated in a chemical dependency
treatment program in the prior two years.
3. Refusal to Submit to Testing.
If an employee refuses to submit to drug and alcohol testing
carried out in conjunction with this policy, the employee may
be subject to discipline including, but not limited to,
discharge. An employee may request a hearing under a
negotiated agreement if permitted, or under the Richfield
Code, 310.42 Subd. 2. If a job applicant refuses to submit
to drug and alcohol testing carried out in conjunction with
this policy, the job applicant may not be hired.
4. First Failure to Pass Drug and Alcohol Testing.
An employee who for the first time has a positive test result
on a confirming test will not be subject to discharge unless:
a. The City has given the employee an opportunity to
participate in a drug or alcohol counseling or
rehabilitation program, and
b. The employee has refused to participate or has failed to
successfully complete the program within a reasonable
time.
5. Failure to Pass Drug and Alcohol Testing Generally.
An employee who receives a positive test result, fails or
refuses a confirmatory test and does not request in writing a
confirmatory retest within five working days after notice of
positive confirmatory test results, may be subject to.
discipline including, but not limited to, discharge subject
to provisions in this policy. Such an employee may request a
hearing under a negotiated agreement if permitted or under
the Richfield Code, Section 310.42 Subd. 2. A job applicant
who receives a positive test result, fails or refpses a
confirmatory test, does not request in writing a confirmatory
retest within five working days after notice of positive
confirmatory test results, maybe refused employment and will
be notified of the reason for such refusal.
6. Rights of Employee or Job Applicant and Other Appeal Rights.
An employee or job applicant who receives .a positive test
result has the right to receive a copy of the test and,
within three working days of notice.of the positive test
result, to submit information to the City to explain the
result or may request in writing within five working days of
notice a confirmatory retest of the original sample at the
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employee's or job applicant's own expense. /D
7. Acknowledgment. /
a. Employees will be^given a copy of this policy at the time
of implementation and will indicate on a form that they
have seen and been given a copy of the policy.
b. New employees will be given a copy of the policy at
orientation.
c. Job applicants conditionally offered a position will
receive a copy of this policy before testing.
Procedures
1. The City of Richfield shall designate the licensed laboratory
facility that shall conduct such tests.
2. This policy shall be distributed to each employee. Each
Department shall retain a copy for employee review.
Approved:
City Manager
•
K
r
I® -3n
NOTICE OF DRUG OR ALCOHOL TEST RESULTS
EMPLOYEE NAME:
DATE RESULTS RECEIVED FROM TESTING COMPANY:
CHECK AS APPROPRIATE:
The result of your initial screening test was negative.
The result of your confirmatory test was negative.
The result of your confirmatory test was positive.
RIGHTS OF EMPLOYEE OR JOB APPLICANT IF CONFIRMATORY
TEST IS POSITIVE:
1. The employee or job applicant has the right to request and
receive from the employer a copy of the test result report.
2. Within three working days after notice of a positive test
result on a confirmatory test, the employee or job
applicant may submit information to the employer, in
.addition to any submitted prior to the giving of a urine •
sample, to explain the test result.
3. Within five days after notice of a positive confirmatory
test, the employee or job applicant may request a
confirmatory re-test of the original sample at the
employee's or job applicant's expense. Within three days
after receiving the employee's or job applicant's re-test
request,, the employer shall notify the testing agency of
the employee's.or job applicant's request. The employee or
job applicant may request a different testing agency
licensed under Chapter 181. If the confirmatory re-test
does not confirm the original positive test result, no
adverse personnel action based on the original confirmatory
test may be taken against the employee or job applicant.
I have received a copy of this completed document.
SIGNED:
DATED:
El
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EFFECTIVEJANUARY 1, 1995
POLICE SUPERVISORS PAY PLAN
COMP.
CODE A B C D
STEP 1 2 3 4
•
PS4-D YR 461945.44 48,674.76 50,388.60 52,118.28
MO 3,912.12 4,056.23 4,199.05 4,343.19
BW 1,805.59 1,872.11 1,938.02 2,004.55
HR 22.5699 23.4013 24.2253 25.0569
PS5-D YR 50,049.00 51,891.48 53,751.24 55,594.08
MO 4,170.75 4,324.29 4,479.27 4,632.84
BW 1,924.96 1,995.83 2,067.36 2,138.23
HR 24.0620 24.9478 25.8419 26.7279
PS6-D YR 53,621.64 55,594.08 57,582.24 59,570.64
MO 4,468.47 4,632.84 4,798.52 4,964.22
BW 2,062.37 20,138.23 2,214.70 2,291.18
HR 25.7796 26.7279 27.6838 28.6397
NORMAL PROGRESSION THROUGH RANGE
1 2 3 4
Start After 1 yr. After 2 yrs. After 3 yrs.
POLICE SUPERVISORS JOB CLASSIFICATIONS
Class Title
Police Captain
Police Lieutenant
Police Sergeant
Comp. Code
PS6-D
PS5-D
PS4-D
0
1
EFFECTIVE JUNE 1, 1995 •
POLICE SUPERVISORS PAY PLAN
COMP.
CODE A B C D
STEP 1 2 3 4
PS4-D YR 47,414.88 49,161.48 50,892.48 52,639.44
MO 3,951.24 4,096.79 4,241.04 4,386.62
BW 1,823.65 1,890.83 1,957.40 2,024.59
_HR 22.7956 23.6353 24.4675 25.3074
PS5-D YR 50,549.52 52,410.36 54,288.72 56,150.04
MO 4,212.46 4,367.53 4,524.06 4,679.17
BW 1,944.21 2,015.78 2,088.03 2,159.62
HR 24.3027 .25.1973 26.1003 .26.9952
PS6-D YR 54,157.80 56,150.04 58,158.12 60,166.32
MO 4,513.15 4,679.17 4,846.51 5,013.86
BW 2,082.99 2,159.62 2,236.85 2,314.09
HR 26.0374 26.9952 27.9606 28.9261
NORMAL PROGRESSION THROUGH RANGE .
1 2 3 4
Start After 1 yr. After 2 yrs. After 3 yrs.
POLICE SUPERVISORS JOB CLASSIFICATIONS
a
Class Title Comp. Code
Police Captain PS6-D
Police Lieutenant PS5-D
Police Sergeant PS4-D
0
9
• CITY OF RICHFIELD, MINNESOTA
Council Letter No. 95
Agenda March 27, 1995
Issue Statement:
Consideration of request for transitional activity permit and off-street parking permit for
Richfield Plumbing and Hagen Micro Age, 510 West 77th Street
Background:
Richfield Plumbing and Hagen Micro Age are being displaced as part of Phase II of the
Shops at Lyndale. They propose to relocate to remodeled premises at 510 West 77th
Street just east of the Hampton Inn.
The new location is within the C-3 zoning district. Because it is non-conforming, a
transitional activity permit is required. The transitional activity permit process provides
for the expansion or extension of existing non-conforming structures or uses where the
specific criteria are met.
Recommended Motion:
Approve a transitional activity permit and off-street parking permit for Richfield Plumbing
and Hagen Micro Age, subject to the following stipulations:
• 1. That payment be made to the City in lieu of providing for management of storm
water on site; and
2. That the area between the east building wall and the east property line be
maintained as a landscaped buffer until such time as it is needed for access
between the north and south parking areas upon elimination of 78th Street access.
Basis of Recommendation:
1. The Planning Commission held a public hearing on March 14, 1995 pursuant to the
C-3 district provisions and unanimously recommended the approval.
2. An eminent domain proceeding has been instituted with respect to their existing
locations on 77 1/2 Street and they have been given a notice to vacate by June 1,
1995.
3. There is inadequate space available on site to provide the floor area ratio and
parking required by C-3 district standards. This permit process provides for a means
to accommodate the proposed uses.
4. The criteria and standards for the permit are met and the new uses will maintain the
vitality and economic success of the businesses, will not have an adverse impact on
• adjoining properties and will not increase the potential public cost of further
development and will be compatible.
q-!
0 , 5. The City Council and HRA have expressed a desire to retain in Richfield those
businesses displaced by the Shops at Lyndale.
6. Parking will be expanded and adequate to meet the needs of the businesses.
7. Landscaping plans have been approved by the City Planner.
8. A Storm Water Management Plan has been approved by the City Engineer and there
is agreement on a payment in lieu of on site management of storm water.
9. Although not currently needed or recommended, space for a drive must be kept
available to provide access between the north and south parking lots if 78th Street is
ultimately eliminated by the widening of 1-494.
Alternative Recommendation:
The City Council could deny the requests with a finding of fact that the proposed use
would have an adverse impact on surrounding properties or the City as a whole.
Discussion/Decision Mode:
A public hearing was held by the Planning Commission on March 14, 1995. Action by
the City Council on March 27, 1995 will provide adequate time for the remodeling and
relocation of these businesses. Notice of this meeting was mailed to property owners
within 350 feet of the subject property.
Respectfully submitted,
Ja s D. Prosser
Cit Manager
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CITY OF RICHFIELD, MINNESOTA
Council Letter No. 9 4
Agenda March 27, 1995
Issue Statement:
Continuance of public hearing to expand the boundaries of the redefined
Interstate/Nicollet/Lyndale (ILN)/77th Street Assessment Project Area, and ordering the
undertaking of current maintenance service project, proposed to be City Project No. 901.
Background:
In 1993, construction began on 77th Street for improvements from 1-35W to Cedar Avenue.
In 1995, a significant portion of this project (1-35W to Portland Avenue) will be completed with
extensive landscaping, an irrigation system, sidewalks, and sound wall. Once the
contractors' responsibility ends, the City becomes responsible for the maintenance of these
improvements. The additional maintenance costs will need to be spread over an enlarged
assessment district to include properties benefiting from the new improvements.
At the February 13, 1995 public hearing, staff recommended expanding the area to be
assessed for maintenance of the new project. As public improvements are completed on the
rest of the project, the boundaries will need to be expanded again as needed. All single
family and two family residential property will be exempt from the special assessment levy;
with commercial property and multifamily dwelling owners being assessed on a per-square-
foot basis under the proposed plan. The area to be assessed in 1995 will be bounded by 1-
35W, 77th Street, 1-494 and Portland Avenue. The special assessments will pay for
maintenance to the landscaped areas along the screenwall and other common areas.
The newly finished section involves about 21 blocks. Estimates are that maintenance costs
per block should be about $35,000/year for the area from 1-35W to Portland Avenue.
However, two-year guarantees on irrigation and landscape materials will reduce this cost
substantially. Estimated costs in 1995 and 1996 are about $18,000 per year. Most of the
routine maintenance (mowing, weeding, litter cleanup) will be contracted, leaving City crews
to perform repairs on irrigation, lights and signs.
At the February 13, 1995 Council meeting, the public hearing was continued to the March 27,
1995 Council meeting. Council requested staff to research impact of exempting multifamily
residences from the assessment; and to calculate the cost per unit to multifamily residences
if they are included in the assessment. This information was provided at the March 6, 1995
Study Session.
Following the March 6, 1995 Study Session, Council directed staff prepare the special
assessment based on the formula proposed for 1995 at the opening of the public hearing on
February 13, 1995 (including apartments). The Council also directed staff to conduct an
open house on an alternative method of special assessment cost distribution during 1995.
9 S'I
Recommended Motion:
Conduct a public hearing and approve the resolution ordering the 77th Street maintenance
work for the period January 1, 1995 through December 31, 1995 (City Project No. 901) and
the costs to be specially assessed.
Basis for Recommendation:
1. Notice of proposed assessment has been published in the official newspaper.
2. Each affected property owner has been notified of the proposed assessment.
3. Maintenance service for this commercial area is recommended in order to sustain the
current standards for landscaping and maintenance which have been successful over
the past years.
4 The Council has considered other methods or formulas for calculating the proposed
assessment.
Alternative Recommendation:
Council may choose to establish a set rate and limit the maintenance performed to that dollar
amount; however, staff believes the redevelopment area would suffer if limited maintenance
was performed.
Discussion/Decision Mode:
Maintenance service for this commercial area is recommended by staff in order to sustain the
current. standards for landscaping and maintenance which have been successful over the
past years.
Respec Ily submitted,
Jam D. Prosser
City Manager
JDP:cak
8 - C?'
RESOLUTION NO.
RESOLUTION ORDERING UNDERTAKING OF CURRENT SERVICE PROJECT
77TH STREET PROJECT AREA MAINTENANCE
JANUARY 1 THROUGH DECEMBER 31, 1995
CITY PROJECT NO. 901
WHEREAS, pursuant to ordinance, the. City Council of the City of Richfield did
establish a special assessment district and did propose that certain current services be
undertaken by the City in the 77th Street/ILN Redevelopment Area approximately
bounded by 1-35W, Portland Avenue, 1-494 and 77th Street, and that the cost of such
services be specially assessed against benefited property; and
WHEREAS, the City Council of the City of Richfield did also by such resolution
set the date of public hearing on the undertaking of such current service project and the
levying of special assessment to bear the cost thereof; and
WHEREAS, following due notice, such public hearing was held on February 13,
1995 and continued on March 27, 1995, at which times all interested parties desiring to
be heard were given an opportunity to be heard.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of
Richfield, Minnesota, as follows:
1. That the following examples of current services of the City shall be
undertaken by the City within the expanded ILN/77th Street Project Area, which area
constitutes the special assessment district: with the cost of such services to be specially
assessed against the benefited property within the district:
a. Snow, ice or rubbish removal;
b. Weed elimination;
c. Elimination or removal of public health or safety hazards from private,
property, excluding and structure included under the provisions of
Minnesota Statutes Section 463.15 to 463.26;
d. - Installation and repair of water service lines;
e. Street sprinkling or other dust treatment of streets;
f. Trimming and care of trees and the removal of unsound trees;
g. Repair of sidewalks, crosswalks and other pedestrian walkways;
h. Operation of the street lighting system;
i. Maintenance of landscaped areas and other public amenities on or adjacent to
street right-of-way;
j. Snow removal and other maintenance of streets;
k. General maintenance, including repairs and replacement.
g 3
2. The work to be performed may be by day labor, by City force, by contract or
by any combination thereof.
3. The designated period of the project shall be from January 1 through
December 31, 1995. Costs of the project shall be collected in the manner provided in
the Richfield Ordinance Code.
Passed by the City Council of the City of Richfield, Minnesota, this 27th day of March,
1995.
Martin J. Kirsch, Mayor
ATTEST:
Thomas P. Ferber, City Clerk
•
•
I'?'
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 93
Agenda March 27, 1995
Issue Statement:
Public hearing and second readings of: an ordinance amendment to the Zoning
Ordinance on adult uses; an amendment to Section 2020.01 prohibiting nudity in
licensed establishments; an adult establishment ordinance; and an ordinance relating to
premises conducive to high-risk sexual conduct.
Background:
The City of Richfield currently regulates adult use establishment through liquor licensing
and a "massage parlor" type ordinance. The Zoning Ordinance does not specifically
relate to adult uses. In recent years, various types of adult uses have appeared in
other cities. Additionally, we have received inquiries received about uses which may
not be covered by either the licensing provisions or the Zoning Ordinance. In response,
the City Council has approved and extended a moratorium to provide adequate time to
research and address the land use, zoning and licensing issues.
Recommended Motion:
Conduct a public hearing and approve on second reading:
00 1. Amendment to the Zoning Ordinance to regulate the location of adult
establishments;
2. Section 1196 -Adult Establishments;
3. Amendments to Subd. 6 of Subsection 2020.1 prohibiting nudity in licensed
establishments; and
4. Section 625 - Premises Conducive to High-Risk Sexual Conduct.
Basis of Recommendation:
1. Since the moratorium on adult uses was approved by the City Council, the Planning
Commission has been reviewing the materials and studies relating to adult use
establishments and received the counsel of the City Attorney's office.
2. New ordinances have been developed as well as an amendment to the Zoning
Ordinance.
3. The community has been solicited for its views throughout the process. There have
been several articles in the Sun Current and Your City. Planning Commission
Members have appeared on a local cable program, spoken to service clubs and
written letters to the editor. An informational meeting was held where residents
were invited through the newspaper, letters to all the churches, service clubs and
?'j
civic groups, and cable. This meeting was also noted on WCCO radio and
television. A public meeting was also held, pursuant to published notice, with about
a dozen people present. No negative responses were received. Some three
churches responded favorably as did the Richfield School Board.
4. The Planning Commission voted unanimously in favor of recommending the adult
use ordinances and amendment to the Zoning Ordinance.
5. The Planning Commission, based on its research, made certain findings including:
a) Obscenity in its various forms is not protected and may currently be
prosecuted under state law.
b) Adult use establishments cannot be totally banned nor regulated on the basis
of materials sold or entertainment provided because of the protection granted
under the First Amendment to the Constitution.
c) Adult use establishments may be regulated based on the secondary effect
that such business may have on the surrounding area. The Commission
concluded that such businesses do create adverse secondary effects such as
neighborhood blight, diminished property values and increased crime based
on studies of similar issues by other cities.
6. Section 1196 -Adult Establishments defines the type establishments covered by the
ordinance, requires a license after investigation and limits the location of such
establishments.
7. The Zoning Ordinance would limit the location to C-2, C-3, PC-2 and I districts.
Adult establishments are further limited under Section 1196.05. Such businesses
are excluded from an area within 1000 feet of a park, school, church, library or
commercial daycare center or within 200 feet of a residential zoning district or 1000
feet of another adult establishment or 100 feet from the right of way of an entry
street to the City. This results in designating an area that comprises about two
percent of the City or about 19.8 percent of the permitted zones. Generally, the
area is south of 77th Street along 1-494 as is noted in the attached map.
- 8. Revocation of any City license because of specified conduct is covered in the
amendment to Subd. 6 of Subsection 2020.01.
9. Public health issues are covered in a new Section 625 - Premises Conducive to
High Risk Sexual Conduct.
Alternative Recommendation:
1. The Council may decide to not adopt the ordinances.
a
117-0-
2. The Council could suggest modifications and return the ordinances to the Planning
Commission for further consideration.
Discussion/Decision Mode:
A public hearing and second reading is scheduled for 7:00 p.m. on March 27, 1995.
The moratorium on the establishment of adult use businesses is still in effect.
Respectf Ily submitted,
Jame . Prosser
City anager
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--74
ORDINANCE NO. _
AN ORDINANCE REGULATING THE LOCATION OF ADULT
ESTABLISHMENTS; AMENDING SUBSECTIONS 520.15,
520.31, 525.01 AND 530.13 OF THE RICHFIELD CITY
CODE, APPENDIX B (ZONING)
THE CITY OF RICHFIELD ORDAINS:
Section 1. Subsection 520.15 of the Richfield City Code, Appendix B (Zoning)
is amended by adding the following new subdivision:
Subd. 9. Adult establishments as defined and regulated in
Section 1196 of the City Code.
Sec. 2. Subsection 520.31, subd. 3, of the Richfield City Code, Appendix B
(Zoning) is amended by adding the following paragraph:
(g) Adult establishments as defined and regulated in Section
1196 of the City Code.
Sec. 3. Subsection 525.01 of the Richfield City Code, Appendix B (Zoning)
is amended by adding the following new subdivision:
Subd. 19. Adult establishments as defined and regulated in
Section 1196 of the City Code.
Sec. 4. Subsection 530.13, subdivision 2 of the Richfield City Code,.Appendix
B (Zoning) is amended to read as follows :
Subd. 2. Other uses. Uses other than the permitted uses listed
in subdivision 1 are allowed in a PUD district, provided (i) the use is
one which is authorized in one of the six types of PUD districts, and
(ii) that such additional use may not occupy more than 33 percent of the
gross floor area of the PUD district. Notwithstanding the foregoing,
an adult establishment as defined and regulated in Section 1196 of the
r;+-v, re%rao is rest rnprmittArl in nnv PUT) district other than a PC-2
Sec. 5. This ordinance is effective in accordance with Section 3.09 of the
Richfield City Charter.
Passed by the City Council of the City of Richfield, Minnesota this day
of . , 1995.
Martin J. Kirsch, Mayor
ATTEST:
a Thomas P. Ferber, City Clerk
JJT83697
RC160-5
ORDINANCE NO.
AN ORDINANCE REGULATING ADULT ESTABLISHMENTS
AND PREMISES CONDUCIVE TO HIGH RISK SEXUAL
CONDUCT, ADDING NEW SECTIONS TO THE RICHFIELD
CITY CODE, AND AMENDING SUBSECTION 2020.10,
SUBDIVISION 6 OF THE CITY CODE.
THE CITY OF RICHFIELD ORDAINS:
Section 1. The Richfield City Code is amended by adding a new section to
read:
Section 1196 - Adult Establishments
1196.01 Findings and Purpose. Studies conducted by the
Minnesota attorney general, the American Planning Association and
cities such as St. Paul; Indianapolis; Alexandria, Minnesota; Roches-
ter, Minnesota; Phoenix, Arizona; Los Angeles, California; Seattle,
Washington; have studied the impacts that adult establishment have in
those communities. These studies have concluded that adult establish-
ments have adverse impact on the surrounding neighborhoods. Those
impacts include increased crime rates, lower property values, increased
transiency, neighborhood blight and potential health risks. Based on
these studies and findings, the city council concludes:
0 (a) Adult establishments have adverse secondary impacts of the
types set forth above.
(b) The adverse impacts caused by adult establishments tend to
diminish if adult establishments are governed by locational
requirements, licensing requirements and health requirements.
(c) It is not the intent to prohibit adult establishments from having
a reasonable opportunity to locate in the city.
(d) Minnesota Statutes, Section 462.357, allows the city to adopt
regulations to promote the public health, safety, morals and
general welfare.
(e) The public health, safety, morals and general welfare will be
promoted by the city adopting regulations governing adult
establishments.
1196.03 Definitions. Subdivision 1. The following terms have the
meanings given them below.
Subd. 2. Adult Establishment. A business engaged in any of
the following activities or which utilizes any of the following business
procedures or practices :
0 (a) a business that is conducted exclusively for the patronage of
adults and as to which minors are specifically excluded from
JJT83698
RC145-288
patronage, either by operation of law or by the owners of such
business, except any business licensed under Chapter XII of the
Richfield City Code;
(b) any business that has at least 20% of its floor area (not including
storerooms, stock areas, bathrooms, basements, attics or any
portion of the business not open to the public) devoted to items,
merchandise or other material that is distinguished or
characterized by an emphasis on material depicting, exposing,
describing, discussing or relating to specified sexual activities
or specified anatomical areas; or
(c) Any adult use as defined in subdivision 3 of this section.
Subd. 3. Adult Use. An adult use is any of the activities and
businesses described below:
(a) Adult Body Painting Studio: An establishment or business which
provides the service of applying paint or other substance,
whether transparent or non-transparent, to the body of a patron
when such person is nude.
(b) Adult Bookstore: An establishment or business used for the
barter, rental or sale of items consisting of printed matter,
pictures, slides, records, audio tape, videotape, or motion
picture film if such business is not open to the public generally
but only to one or more classes of, the public, excluding any
minor by reason of age, or if at least 20% of its floor area (not
including storerooms, stock areas, bathrooms, basements, attics
or any portion of the business not open to the public) is devoted
to items, merchandise or other material distinguished or charac-
terized by an emphasis on the depiction or description of
"specified sexual activities" or "specified anatomical areas."
(c) Adult Cabaret. A business or establishment that provides
dancing or other live entertainment to patrons if the dancing and
live entertainment is distinguished and characterized by an
emphasis on the presentation, display, depiction of matter that
seeks to evoke, arouse or excite the patrons' sexual or erotic
feelings or desire.
(d) Adult Companionship Establishment: A business or establishment
that excludes minors by reason of age, and which provides the
service of engaging in or listening to conversation, talk or
discussion between an employee of the establishment and a
customer, if such service is distinguished and characterized by
an emphasis on "specified sexual activities" or "specified
anatomical areas."
(e) Adult Conversation/ Rap Parlor: A business or establishment
that excludes minors by reason of age, and which provides the
services of engaging in or listening to conversation, talk, or
discussion, if such service is distinguished and characterized by
JJT83698
RC145-288 2
-7--7
an emphasis on "specified sexual activities" or "specified
anatomical areas. It
(f) Adult Health/ Sport Club : A health/ sport club which excludes
minors by reason of age, if such club is distinguished and
characterized by an emphasis on "specified sexual activities" or
"specified anatomical areas . "
(g) Adult Hotel or Motel: A hotel or motel from which minors are spe-
cifically excluded from patronage and where material is presented
which is distinguished and characterized by an emphasis on
matter depicting, describing or relating to "specified sexual
activities" or "specified anatomical areas."
(h) Adult Massage Parlor, Health Club: A massage parlor or health
club which restricts minors by reason of age, and which provides.
the services of massage, if such service is distinguished and
characterized by an emphasis on "specified sexual activities" or
"specified anatomical areas."
(i) Adult Mini-Motion Picture Theater: A business or establishment
with a capacity for less than 50 persons used for presenting
material if such material is distinguished and characterized by an
emphasis on matter depicting, describing or relating to "speci-
fied sexual activities" or "specified anatomical areas."
(j) Adult Modeling Studio: A business or establishment that
provides customers figure models who are so provided with the
intent of providing sexual stimulation or sexual gratification to
such customers and who engage in "specified sexual activities"
or display "specified anatomical areas" while being observed,
painted, painted upon, sketched, drawn, sculptured, photo-
graphed, or otherwise depicted by such customers.
(k) Adult Motion Picture Arcade: Any place to which the public is
permitted or invited where coin or slug-operated or electronical-
ly, electrically or mechanically controlled or operated still or
motion picture machines, projectors or other image-producing
devices are maintained to show images to five or fewer persons
per machine at any one time, and where the images so displayed
are distinguished and characterized by an emphasis on depicting
or describing "specified sexual activities" or "specified anatomi-
cal areas . "
(1) Adult Motion Picture Theater: A motion picture theater with a
capacity of 50 or more persons used for presenting material if
such theater as a prevailing practice excludes minors by reason
of age or if such material is distinguished or characterized by an
emphasis on "specified sexual activities" or "specified anatomical
areas" for observation by patrons.
(m) Adult Novelty Business: A business which has as a principal
activity the sale of devices which stimulate human genitals or
devices which are designed for sexual stimulation.
JJT83698
RC145-288 3
(n) Adult Sauna: A sauna which excludes minors by reason of age,
and which provides a steam bath or heat bathing room used for
the purpose of bathing, relaxation, or reducing, utilizing steam
or hot air as a cleaning, relaxing or reducing agent, if the
service provided by the sauna is distinguished or characterized
by an emphasis on "specified sexual activities" or "specified
anatomical areas. It
(o) Adult Steam Room/Bathhouse Facility:. A building or portion of
a building used for providing a steam bath or heat bathing room
used for the purpose of pleasure, bathing, relaxation, or reduc-
ing, utilizing steam or hot air as a cleaning, relaxing or reducing
agent if such building or portion of a building restricts minors
by reason of age and if the service provided -by the steam
room/bathhouse facility is distinguished and characterized by an
emphasis on "specified sexual activities" or "specified anatomical
areas."
Subd. 4 . Nude or Specified Anatomical Areas :
(a) Less than completely and opaquely covered human genitals,
pubic region, `buttock, anus, or female breast (s) below a point
immediately above the top of the areola; and
(b) Human male genitals in a discernibly turgid state, even if
completely and opaquely covered`.
Subd. 5. Specified Sexual Activities.
(a) Actual or simulated sexual intercourse, oral copulation, anal
intercourse, oral-anal copulation, bestiality, direct physical
stimulation of unclothed genitals, flagellation or torture in the
context of a sexual relationship, or the use of excretory func-
tions in the context of a sexual relationship, and any of the
following sexually-oriented acts. or conduct: anilingus, bug-
gery, coprophagy, coprophilia, cunnilingus, fellatio, necrophil-
ia, pederasty, pedophilia, piquerism, sapphism, zooerastia; or
(b) Clearly depicted human genitals in the state of sexual stimula-
tion, arousal or tumescence; or.
(c) Use of human or animal ejaculation, sodomy, oral copulation,
coitus, or masturbation; or
(d) Fondling or touching of nude human genitals, pubic region,
buttocks, or female breast(s); or
(e) Situations involving a person or persons, any of whom are nude,
clad in undergarments or in sexually revealing costumes, and
who are engaged in activities involving the flagellation, torture,
fettering, binding or other physical restraint of any such
persons; or
JJT83698
RC145-288 4
7- 9
(f) Erotic or lewd touching, fondling or other sexually oriented
contact with an animal by a human being; or
(g) Human excretion, urination, menstruation, vaginal or anal
irrigation.
1196.05 Location. Subdivision 1. No adult establishment may be
located within 1,000 feet of a park, school, church, library or a
commercial day care center.
Subd. 2. No adult establishment may be located within 1, 000 feet
of another adult establishment.
Subd. 3. No adult establishment may be located within 200 feet
of a residential zoning district.
Subd. 4. No adult establishment may be located within 100 feet
of the right-of-way of an entry street to the city. For purposes of this
subdivision, an entry street is defined as Penn Avenue, Lyndale
Avenue, Nicollet Avenue, Portland Avenue, Cedar Avenue and 12th
Avenue.
Subd. 5. The distances set forth in this subsection are to be
measured from the nearest outside edge of the building housing the
adult establishment, or the outside edge of the premises of the adult
business if the adult business is located in a building containing other
businesses, to the nearest boundary of the residential zoning district
or the nearest boundary of the property containing a park, school,
church, library, commercial day care center, or other adult
establishment.
Subd. 6. The screen wall and loop streets on the north side of
77th Street and east of I-35W were intended to form a barrier between
the commercial properties located south of 77th Street and the residen-
tial properties north of 77th Street; therefore, the distances set forth
in this subsection do not apply across 77th Street, east of I-35W.
1196.07 Additional Conditions for Adult Cabarets. Subdivision 1.
The following additional conditions apply to adult cabarets.
Subd. 2. No owner, operator or manager of an adult cabaret
shall permit or allow any dancer or other live entertainer to perform
nude.
Subd. 3. No dancer, live entertainer, performer, patron or any
other person shall be nude in an adult cabaret.
Subd. 4. The owner, operator or manager of an adult cabaret
shall provide the following information to the city concerning any
persons who dance or perform live entertainment at the adult cabaret:
The person's name, home address, home telephone number, date of
birth and any aliases.
JJT83698
RC145-288 5
Subd. 5. No dancer, live entertainer or performer shall be under
18 years old.
Subd. 6. All dancing or live entertainment shall occur on a
platform intended for that purpose and which is raised at least two feet
from the level of the floor.
Subd. 7. No dancer, live entertainer or performer shall perform
any dance or live entertainment closer than 10 feet to any patron.
Subd. 8. No dancer, live entertainer or performer shall fondle
or caress any patron and no patron shall fondle or caress any dancer
or performer.
Subd. 9. No patron shall pay or give any gratuity to any
dancer, live entertainer or performer.
Subd. 10. No dancer, live entertainer or performer shall solicit
any pay or gratuity from any patron.
1196.09 Hours of Operation. No adult establishment may be open
to the public between the hours of 1:00 a.m. and 10:00 a.m. This
subsection is not applicable to any business that is subject to the hours
of operation limitation in Section 605.23, subdivision 4.
1196.11 License Required. Subdivision 1. No person shall own or
operate an adult establishment without having first secured a license as
provided for in this subsection. This subsection is not applicable to
any business that must obtain a license required by Section 605 of this
Code.
Subd. 2. Application: The application for an adult establishment
license shall be submitted on a form provided by the City and shall
include :
(a) If the applicant is an individual, the name, residence, phone
number, and birthdate of the applicant. If the applicant is a
partnership, the name, residence, phone number, and birthdate
of each general and limited partner. If the applicant is a
corporation, the names, residences, phone numbers, and
birthdates of all those persons holding more than five (5) percent
of the issued and outstanding stock of the corporation.
(b) The name, address, phone number, and birthdate of the operator
and manager of such operation, if different from the owners.
(c) The address and legal description of the premises where the
adult establishment is to be located.
(d) A statement detailing any gross misdemeanor or felony convic-
tions relating to sex offenses, obscenity or the operation of an
adult establishment or adult business by the applicant, operator
or manager and whether or not the applicant, operator or
manager has ever applied for or held a license to operate a similar
JJT83698
RC145-288 6
//
type of business in other communities. In the case of a corpora-
tion, a statement detailing any felony convictions by the owners
of more than five (5) percent of the issued and outstanding stock
of the corporation, and whether or not those owners have ever
applied for or held a license to operate a similar type of business
in other communities.
(e) The activities and types of business to be conducted.
(f) The hours of operation.
(g) The provisions made to restrict access by minors.
(h) A building plan of the premises detailing all internal operations
and activities.
Subd. 3. License Fee:
(a) The annual license fee is set forth in Appendix D.
(b) Each application for a license shall be submitted to the Public
Safety Director and payment made to the City. Each application
for a license shall be accompanied by payment in full of the
required license fee. Upon rejection of any application for a
license, the City shall refund the license fee.
(c) All licenses shall expire on the last day of December in each
year. Each license shall be issued for a period of one (1) year,
except that if a portion of the license year has elapsed when the
application is made, a license may be issued for the remainder of
the year for a pro rated fee. In computing such fee, any
unexpired fraction of a month shall be counted as one (1) month.
(d) No part of the fee paid by any license shall be refunded, except
that a pro rata portion of the fee shall be refunded in the
following instances upon application to the City Manager within
30 days from the happening of the event, provided that such
event occurs more than 30 days before the expiration of the
license:
(i) Destruction or damage of the licensed premises by fire or
other catastrophe.
(ii) The licensee's illness.
(iii) The licensee's death.
(iv) A change in the legal status making unlawful for licensed
business to continue.
(e) Each application shall contain a provision on the application in
bold print indicating that any withholding of information or the
providing of false or misleading information will be grounds for
denial or revocation of a license. Any changes in the information
JJT83698
RC145-288 7
provided on the application or provided during the investigation
• shall be brought to the attention of the Public Safety Director by
the applicant or licensee. If said changes take place during the
investigation, said data shall be provided in writing to the Public
Safety Director, who shall report the changes to the City
Council. Failure to report said changes by the applicant or the
licensee may result in a denial or revocation of a license
Subd. 4. Investigative Fee: The investigative fee for an adult
establishment license is set forth in Appendix D.
Subd. 5. Granting of License :
(a) The Public Safety Director, or designee, shall complete their
investigation within 30 days after the Public Safety Director
receives a complete application and all license and investigative
fees.
(b) If the application is for a renewal, the applicant shall be allowed
to continue business until the Council has determined to renew
or refuse to renew a license.
(c) If, after such investigation, it appears that the applicant and the
place proposed for the business are eligible for a license under
the criteria set forth in this subsection, then the license shall be
issued by the City Council within 30 days after the investigation
is completed. Otherwise the license shall be denied.
(d) Each license shall be issued to the applicant only and shall not be
transferable to another holder. 'Each license shall be issued only
for the premises described in the application. No license may be
transferred to another premise without the approval of the City
Council.. If the licensee is a partnership or a corporation, a
change in the identity of any of the principals of the partnership
or corporation shall be deemed a transfer of the license. All
adult establishments existing at the time of the adoption of this
subsection shall be required to obtain an annual license.
Subd. 6. Persons Ineligible for License: No license shall be
granted to or held by any person:
(a) Under twenty-one (21) years of age.
(b) Who is overdue or whose spouse is overdue in his or her payment
to the City, county or state of taxes, fees, fines or penalties
assessed against them or imposed upon them;
(c) Who has been convicted or whose spouse has been convicted of a
gross misdemeanor or felony or of violating any law of this state
or local ordinance relating to sex offenses, obscenity offenses or
adult establishments;
(d) Who is not the proprietor of the establishment for which the
license is issued;
JJT83698
RC145-288
8
_7-l 3
(e) Who is residing with a person who has been denied a license by
the City or any other Minnesota municipal corporation to operate
an adult establishment, or residing with a person whose license
to operate an adult establishment has been suspended or revoked
within the preceding twelve (12) months;
(f) Who has not paid the license and investigative fees required by
this subsection.
Subd. 7 Places Ineligible for License :
(a) No license shall be granted for adult establishments on any
premises where the applicant or any of its officers, agents or
employees has been convicted of a violation of this subsection, or
where any license hereunder has been revoked for cause, until
one (1) year has elapsed after such conviction or revocation.
(b) No license shall be granted for any adult establishment which is
not in full compliance with the City Code, the City's zoning
ordinance, the Building Code, the Fire Code, the City's Health
Regulations and all provisions of state and federal law.
Subd. 8 Conditions of License:
(a) Every license shall be granted subject to the following conditions
and all other provisions of this subsection, and of any applicable
sections of the City Code, the City's zoning. ordinance, the
Building Code, the Fire Code, the City's Health Regulations and
all provisions of state and federal law.
(b) All licensed premises shall have the license posted in a conspicu-
ous place at all times.
(c) No minor shall be permitted on the licensed premises.
(d) Any designated inspection officer of the City shall have the right
to enter, inspect, and search the premises of a licensee during
business hours.
(e) Every licensee shall be responsible for the conduct of his/her
place of business and shall maintain conditions of order.
(f) No adult goods or material services shall be offered, sold,
transferred, conveyed, given, displayed, or bartered to any
minor.
Subd. 9 Penalty
(a) Any person violating any provision of this section is guilty of a
misdemeanor and upon conviction shall be punished not more than
the maximum penalty for a misdemeanor as prescribed by state
law.
JJT83698
RC145-288 9
-7-)4
(b) Any violation of this section shall be a basis for the suspension
or revocation of any license granted hereunder. In the event
that the City Council proposes to revoke or suspend the license,
the licensee shall be notified in writing of the basis for such
proposed revocation or suspension. The Council shall hold a
hearing for the purpose of determining whether to revoke or
suspend the license, which hearing shall be within thirty (30)
days of the date of the notice.
(c) The City Council shall determine whether to suspend or revoke
a license within thirty (30) days after the hearing or within 60
days of the date of the notice, whichever is sooner, and shall
notify the licensee of its decision within that period.
Subd. 10. Right of Appeal:
(a) In the event that the Council determines to suspend, or revoke
a license, such suspension or revocation shall not be effective
until fifteen (15) calendar days after notification to the licensee
by the City of its decision. If, within that fifteen (15) days, the
licensee commences an action in state or federal court challenging
the Council's action, then the suspension or revocation shall be
stayed until the conclusion of such action.
(b) If the City Council determines not to renew a license, the
licensee may continue its business for fifteen (15) calendar days
after notification by the City of such non-renewal. If the
licensee commences an action in state or federal court within that
fifteen (15) days for the purpose of determining whether the City
acted properly, the licensee may continue in business until the
conclusion of the action.
(c) If the City Council decides not to grant a license to an applicant,
the applicant may commence an action in state or federal court
within fifteen (15) days after notification by the City of the
denial for the purpose of determining whether the City acted
properly. The applicant shall not commence doing business
unless the action is concluded in its favor.
(d) Any notification required to be sent by the City is deemed
completed when mailed by first class mail to the applicant or
licensee at the address listed in the application.
See. 2. Subsection 2020. 01, Subdivision 6 of the Richfield City Code is
amended to read as follows :
Subd. 6. Prohibition. It is unlawful for the licensee, owner or
manager of an adult establishment as defined in Section 1196 of this
code or any establishment licensed pursuant to eha-pter X1 this code
to permit or allow in such establishment any nudity, sadomasochistic
abuse, sexual conduct or sexual excitement as defined in this section,
or for any person to participate or engage in such conduct. Violation
of this subsection is grounds for the revocation of a any license issued
pursuant to ehapte„ X11 this code.
JJT83698
RC145-288 10
-7-15
Sec. 3. The Richfield City Code is amended by adding a new section to read :
Section 625 - Premises Conducive to High-Risk Sexual Conduct
625.01 Purpose. The purpose of this section of the City Code is to
prescribe regulations governing commercial premises, buildings, and
structures that are conducive, by virtue of design and use, to,
high-risk sexual conduct which can result in the spread of sexually
transmitted diseases to persons frequenting such premises, buildings,
and structures.
625.03. Findings of the City Council. Subdivision 1. The City Council
of the City of Richfield makes the following findings regarding the need
to regulate commercial premises, buildings, and structures that are
conducive to the spread of communicable disease of danger to persons
in order to further the substantial interest of public health.
Subd. 2. The experience of other cities establishes that certain
commercial premises, buildings, and structures, or parts thereof, by
reason of the design and use of such premises, buildings, or structures
are conducive to the spread of communicable disease of danger to
persons frequenting such premises, buildings, or structures, as well
as to the general public, and that the risk of spreading infectious and
contagious diseases can be minimized by regulating such commercial
premises, buildings, and structures.
. Subd. 3. The experience of other cities where such commercial
premises, buildings, and structures are present indicates that the risk
of spreading the sexually transmittable disease of Acquired Immune
Deficiency Syndrome (AIDS) is increased by the presence of such
premises, buildings, and structures, because the design or use of such
premises, buildings, and structures, or parts thereof can facilitate
high-risk sexual conduct.
Subd. 4. Medical publications of the Center for Disease Control
of the United States Department of Health and Human Services indicate
that the sexually transmittable disease of AIDS is currently irreversible
and uniformly fatal. Medical research has further established that the
risk factors for obtaining or spreading AIDS are associated with high -
risk sexual conduct.
625.05. Definitions . Subdivision 1. The following words and phrases
when used in this section shall have the following meanings unless the
context indicates otherwise :
Subd. 2. Booths, stalls, or partitioned portions of a room or
individual room: (i) enclosures specifically offered to persons for a fee
or as -an incident to performing high-risk sexual conduct, or (ii)
enclosures which are part of a business operated on the premises which
offers movies or other entertainment to be viewed within the enclosure,
including enclosures wherein movies or other entertainment is
dispensed for a fee.
•
JJT83698
RC145-288 1
The phrase "booths, stalls, or partitioned portions of a room or
individual room" does not mean enclosures which are private offices
used by the owners, managers or persons employed by the premises for
attending to the tasks of their employment, and which are not held out
to the public or members of the establishment for hire or for a fee or for
the purpose of viewing movies or other entertainment for a fee, and are
not open to any persons other than employees.
Subd. 3. Doors, curtains or portal partitions: full, complete, non-
transparent closure devices through which one cannot see or view
activity taking place within the enclosure.
Subd. 4. Hazardous site: any commercial premises, building or
structure, or any part thereof, which is a site of high-risk sexual
conduct as defined herein.
Subd. 6. Open to an adjacent public room so that the area inside is
•
visible to persons in the adjacent public room: either the absence of any
entire "door, curtain or portal partition" or a door or other device
which is made of clear, transparent material such as glass, plexiglass
or other similar material meeting building code and safety standards,
which permits the activity inside the enclosure to be entirely viewed or
seen by persons outside the enclosure.
Subd. 7. Public health official: an agent or employee of the city
charged with the enforcement of the state or local health laws.
625.07. Public Health Regulations. Subdivision 1. No commercial
building, structure, premises or part thereof, or facilities therein shall
be so constructed, used, designed or operated in the City for the
purpose of engaging in, or permitting persons to engage in, sexual
activities which include high-risk sexual conduct.
Subd. 2. No person shall own, operate, manage, rent, lease, or
exercise control of any commercial building, structure, premises, or
portion or part thereof in the City, which contains :
(a) Partitions between subdivisions of a room, portion or part of a
building, structure or premises having an aperture which is
designed or constructed to facilitate sexual activity, including
but not limited to vaginal intercourse, anal intercourse, or
fellatio, between persons on either side of the partition.
(b) "Booths, stalls, or partitioned portions of a room or individual
room" as defined herein which have "doors, curtains or portal
-partitions" as defined herein unless such booths, stalls,
partitioned portions of a room or individual room have at least
one side open to an adjacent public room so that the area inside
JJT83698
RC145-288 12
Subd. 5. High-risk sexual conduct:
(i) fellatio;
(ii) anal intercourse;, and/or
(iii) vaginal intercourse with persons who engage in
sexual acts in exchange for money.
is visible to persons in the adjacent public room as defined
herein. Booths, stalls; and/or partitioned portions of a room or
individual room that are so open to an adjacent public room shall
be lighted in a manner that the persons in the area used for
viewing motion pictures or other forms of entertainment are
visible from the adjacent public rooms, but such lighting shall
not be of such intensity as to prevent the viewing of the motion
pictures or other offered entertainment.
625.09. Exceptions. The regulations set forth in this section shall not
apply to premises, buildings, or structures that are lawfully operating
and licensed as hotels, motels, apartment complexes, condominiums,
townhomes, or boarding houses which are subject to other general
health and sanitation requirements under state and local law.
625.11. Health Enforcement Powers. Subdivision 1. In exercising
powers conferred by this or any other section of this Code relating to
communicable diseases, the Public Health Official shall be guided by the
most recent instructions, opinions and guidelines of the Center for
Disease Control of the United States Department of Health and Human
Services which relate to the spread of infectious diseases.
Subd. 2. In order to ascertain the source of infection and reduce
its spread, the Public Health Official, and persons under the Public
Health Official's direction and control, shall have full power and
authority to inspect or cause to be inspected, and to issue orders
regarding any commercial building, structure or premises, or any part
• thereof, which may be a site of high-risk sexual conduct. If the Public
Health Official determines that a hazardous site as defined herein
exists, the Public Health Official shall declare it to be a public health
hazard and public health nuisance and shall then:
(a) Notify the manager, owner, or tenant of the hazardous site that
the Public Health Official has reasonable belief that the premises,
building or structure is a hazardous site as defined herein,
(b) Issue two written warnings at least ten (10) days apart to the
manager, owner, or tenant of the premises stating the specific
reasons for the Public Health Official's opinion that the premises,
building, or structure is a hazardous site as defined herein,
(c) Once such notices and warnings have been issued, the Public
Health Official or the Public Health Official's appointee shall
proceed as follows :
(1) After the manager, owner or tenant of the premises has
been notified in writing as to the basis of the Public Health
Official's determination, the manager, owner or tenant
shall have ten (10) days from the date of the last warning
to request a hearing before the Public Health Official or
the Public Health Official's appointee for the determination
as to the existence of such hazardous site. If the manag-
er, owner or tenant of the premises does not request a
hearing within ten (10) days of the date of the last
JJT83698
RC145-288 13
,P) -/ ?
warning notice, the Public Health Official shall then cause
the premises to be posted with a warning advising the
public that the premises have been declared a hazardous
site and the Public Health Official shall cause orders to be
issued to the manager, owner or tenant of the premises
constituting the hazardous site to take specified corrective
measures to prevent high-risk sexual conduct from taking
place within the premises.
(2) If the manager,. owner, or tenant of the premises requests
a hearing, the hearing shall be held before the Public
Health Official or the Public Health Official's appointee at
a date not more than thirty (30) days after demand for a
hearing. After considering all evidence, the Public Health
Official or the Public Health Official's appointee shall make
a determination as to whether the premises constitute a
hazardous site, as defined herein and issue a decision
based upon all hearing evidence presented. If the Public
Health Official or the. Public Health Official's appointee
makes a determination that the premises constitute a
hazardous site, the Public Health Official shall then issue
orders to the manager, owner, or tenant of the premises
to take corrective measures to prevent high-risk sexual
conduct from taking place within the premises and cause
the premises to be posted with a warning advising the
public that the premises have been declared a hazardous
site.
(3) If, within thirty (30) days from issuance of the orders to
the manager, owner, or tenant of the hazardous site, the
Public Health Official determines that such corrective
measures have not been undertaken, the Public Health
Official may order the abatement of the hazardous site as
a public nuisance, which shall be enforced by mandatory
or prohibitory injunction in a court of competent jurisdic-
tion, or may secure a court order for the closure of the
premises constituting the hazardous site until the premis-
es, building, or structure is in compliance with the
regulations set forth in Section 9.14 of this section.
625.13. Criminal Penalties. Any person violating any provision of this
section or any person who removes, destroys or defaces warnings
posted on premises by the Public Health Official pursuant to this section
shall be guilty of a misdemeanor.
Sec. 4. Effective Date. This ordinance is effective in accordance with Section
3.09 of the Richfield City Charter.
Passed by the City Council of the City of Richfield, Minnesota this day
of , 1995.
Martin J. Kirsch, Mayor
JJT83698
RC145-288 14
•
ATTEST:
Thomas P. Ferber, City Clerk
JJT83698
RC145-288
15
7-i 9
69
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 92
Agenda March 27, 1995
Issue Statement:
Public hearing and second reading on a transitory ordinance to vacate right-of-way;
CSM, Phase 1.
Background:
On February 27, 1995, the City Council gave first reading to an ordinance which would
vacate a portion of old 77th Street east of Emerson Avenue. (It is depicted on the
attached map.)
Recommended Motion:
Hold the public hearing and adopt a motion approving the attached transitory ordinance
vacating a portion of old 77th Street between Emerson and Colfax Avenues.
Basis of Recommendation:
1. The land is no longer needed for right-of-way and is not now being used for right-of-
way.
2. First reading was held on February 27, 1995.
3. A public hearing notice was published in the Sun-Current on March 8, 1995.
4. A mailed notice was sent to property owners within 350 feet of the right-of-way.
5. Easements will be retained for the 42" storm sewer, 9" sanitary sewer and 12" water
main.
Alternative Recommendation:
1. Reject the proposal.
2. Delay action.
Discussion/Decision Mode:
Action by the Council on March 27, 1995 will facilitate processing.
Respectf submitted,
Jame . Prosser
City Ma ager
JDP:ds
BILL NO.
TRANSITORY ORDINANCE NO.
AN ORDINANCE VACATION OF A PORTION OF OLD 77TH STREET
BETWEEN EMERSON AND COLFAX AVENUES
THE CITY OF RICHFIELD DOES ORDAIN:
Section 1. The following described land is subject to an easement for public street
purposes (the "Street Easement"), created by document dated October 19, 1953, filed
December 2, 1953 in the office of the Hennepin County Recorder as Document No.
2848415:
The North 30 feet of the North 255 feet of the West 320 feet of the South 1/2 of
the Southeast 1/4 of the Southeast 1/4 of Section 33, Township 28, North Range
24, West of the 4th Principal meridian, except the East 30 feet thereof and except
the West 130 feet of the East 160 feet of the South 50 feet thereof, Hennepin
County, Minnesota.
Section 2. The fee owner of the Easement Area, CSM Investors, Inc., has
petitioned for the vacation of that part of the Street Easement which lies southerly of the
following described line:
Commencing at the northeast corner of the north 255 feet of the west 320 feet of
the South 1/2 of the Southeast 1/4 of the Southeast 1/4 of Section 33, Township
28 North, Range 24 West, Hennepin County, Minnesota; thence South 89 degrees
53 minutes 31 seconds West, assumed bearing, 30.00 feet along the north line
thereof to the point of beginning of the line to be described; thence South 00
degrees 04 minutes 44 seconds West 30.00 feet; thence South 89 degrees 53
minutes 31 seconds West 189.19 feet; thence northwesterly 190.45 feet on a
nontangential curve to the right with a radius of 610.33 feet and a central angle of
17 degrees 52 minutes 44 seconds, and a chord bearing of North 81 degrees 00
minutes 28 seconds West, to a point on the north line of the north 240 feet of the
East 1/2 of the Southeast 1/4 of the Southwest 1/4 of the Southeast 1/4 of Section
33, and said described line there terminating. .
(referred to herein as the "Vacated Area').
Section 3. CSM Investors, Inc. has agreed to convey to the City a drainage and
utility easement over the entire area occupied by the Street Easement. The proposed
vacation of the Vacated Area therefore will not adversely affect the ability of the City or
other utility to maintain, repair, or replace any utility facilities that may be located within
the area to be vacated.
40
Section 4. The Council finds that, upon recording of the replacement drainage and
utility easement to be conveyed by CSM Investors, Inc., there will no longer be a public
need for a street easement over the Vacated Area, as described in Section 2 of this
Ordinance.
Section 5. The street easement over the Vacated Area, as described in Section 2
of this Ordinance, is hereby vacated.
Passed by the City Council of the City of Richfield, Minnesota this 27th day of
March, 1995.
Martin J. Kirsch, Mayor
ATTEST:
Thomas P. Ferber, City Clerk .
(0-3
0 DRAINAGE, UTILITY AND RIGHT-OF-WAY EASEMENTS
THIS EASEMENT is given this day of
, 19951 by CSM INVESTORS, INC., a Minnesota
corporation, to CITY OF RICHFIELD, a Minnesota municipal corpora-
tion, Grantee.
Recitals
A. Grantor is the fee owner of certain real estate in Hennepin
County, Minnesota, described on the attached. Exhibit A and
identified therein as "Parcel 1."
a. Grantor is the fee owner of certain real estate in Hennepin
County, Minnesota described on the attached Exhibit A and identi-
fied therein as "Parcel 2."
C. Grantor is the fee owner of certain real estate in Hennepin
County, Minnesota described on the attached Exhibit A and identi-
fied therein as "Parcel 3."
Easement
For good and valuable consideration, receipt of which is acknowl-
edged by Grantor, the Grantor hereby conveys and quitclaims to
Grantee the easements as described below:
Drainace and Utility Easement - No. 1
A permanent public drainage and utility easement over,
under and across Parcel$ 1 and 2 as described on the
attached Exhibit A. [Revise this easement so that the
northerly limit of the easement is a line drawn parallel
to and 10 feet northerly of the 42" storm sewer located
in Parcel 2.]
Drainage and Utility Easement - No. 2
A permanent public drainage and utility easement over,
under and across the north 30 feet of Parcel 3 as
described on the attached Exhibit A.
Public Street Richt-of Way - No. 1
A permanent public street right-of-way over, under and
across that part of Parcels 1 and 3, as described on the
attached Exhibit A, described as: Commencing at the
northeast corner of the north 255 feet of the west 320
feet of the South 1/2 of the southeast 1/4 of the
Southeast 1/4 of section 33, Township 28 North, Range 24
West, Hennepin County, Minnesota; thence South 89 degrees
53 minutes 31 seconds West, assumed bearing, 30.00 feet
along the north line thereof to the point of beginning of
Q083977
RCIZS-66 1
6-q
the right-of-way to be described; thence South 00 degrees
04 minutes 44 seconds West 30.00 feet; thence South 89
degrees 53 minutes 31 seconds West 189.19 feet; thence
northwesterly 190.45 feet on a nontangential curve to the
right with a radius of 610.33 feet and a central angle of
17;degrees 52 minutes 44 seconds, and a chord bearing of
North 81 degrees 00 minutes 28 seconds West, to a point
on the north line of the north 240 feet of the East 1/2
of the Southeast 1/4 of the Southwest 1/4 of the South-
east 1/4 of Section 33; thence North 89 degrees 53
minutes 31 seconds East 376.58 feet along said north line
and the north line of the north 255 feet of the went 320
feat of the South 1/2 of the Southeast 1/4 of the
southeast 1/4 of Section 33 to the point of beginning.
Public Street-Right-of-Way - No. -I
A permanent public street right-of-way over, under and
across that part of Parcel 2 as described in the attached
Exhibit A, said street right-of-way being described as
beginning at the most northerly corner of said Parcel 2;
thence southeasterly 30.59 feet along the northeasterly
line of said Parcel 2 on a curve to the left with a
radius of 610.33 feet and a central angle of 02 degrees
52 minutes 19 seconds, and a chord bearing of South 55
degrees 56 minutes 46 seconds East, assumed bearing;
thence westerly and southwesterly 31.02 feet on a curve
to the left with a radius of 20.00 feet and a central
angle of 88 degrees 52 minutes 23 seconds, and a chord
bearing of South 78 degrees 10 minutes 53 seconds West;
thence southwesterly 62.68 feet on a curve to the right
with a radius of 282.00 feet and a central angle of 12
degrees 44 minutes 04 seconds, and a chord bearing of
south 40 degrees 06 minutes 43 seconds West to a point on
the west line of said Parcel 2; thence northeasterly
50.'7`7 feet along said, went line on a curve to the right
with a radius of 120.00 feet and a central angle of 24
degrees 14 minutes 30 seconds, and a chord bearing of
North 26 degrees it minutes 10 seconds East; thence North
38 degrees 18 minutes 25 seconds East 32.47 feet along
said west line to the point of beginning.
CSM INVESTORS, INC.
By
Its
•
CARS3977
RC325-68 2
&-5--**
0 STATE OF MINNESOTA )
SS.
COUNTY OF HENNEPIN )
The foregoing instrument was acknowledged before me this
day of , 1995 by the
of CSM Investors, Inc., a Minnesota
corporation, on behalf of the corporation.
NO'T'ARY STAMP OR SEAL
THIS INSTRUMENT DRAFTED BY:
Holmes & Graven, chartered
470 Pillsbury Center
Minneapolis, MN 55402
(612) 337-9300
•
•
Notary Public
CAX83997
1=25-68 3
i
EXHIBIT A
67- 69
Parcel 1
The North 30 feet of the East Half of the Southeast Quarter of
southwest Quarter of the Southeast Quarter of Section 33,
Township 28, Range 24, Hennepin County, Minnesota
Parcel 2
That part of the following described land:
The South 85 feet of the West Half of the East Half of the
Northeast Quarter of the Southwest Quarter of the Southeast
Quarter of Section 33, Township 28, Range 24, Hennepin County.
Minnesota
and
Lot 8, NORTHFELT ADDITION, Hennepin County, Minnesota
and
Vacated unvacated 77th
ADDITI N, Street dedicated
Minn sota the
plat of NO ORTHFELT
being described as follows:
Commencing at the southeast corner of the Northeast Quarter of
the Southwest Quarter of the Southeast Quarter of said Section
33; thence South 89 degrees 41 minutes 41 seconds West,
assumed bearing, along the south line of said Northeast
Quarter of Southwest Quarter of Southeast Quarter 86.58 feet
to the point of beginning of the parcel to be described;
thence northwesterly 187.04 feet along a non-tangential curve
concave to the northeast having a radius of 610.33 feet and a
central angle of 17 degrees 33 minutes 32 seconds, the chord
of said curve bears North 63 degrees 29 minutes 13 seconds
West; thence South 38 degrees 06 minutes 33 seconds West, not
tangent to said curve, 32.47 feet; thence southerly along a
tangential curve concave to the east having a radius of 120.00
feet to the south line of said Northeast
thencetNorth Quarter 89o degrees e41
Quarter of Southeast Quarter,
minutes 41 seconds East along said south line to the point of
beginning.
•
Parcel 3 R
The North 255 feet of the West 320 feet of the South 1/2 of
the Southeast 1/4 of the Southeast 1/4 of Section 33, Township
28, North Range 24, West of the 4th Principal Meridian, except
the East 30 feet thereof and except the West 130 feet of the
East 160 feet of the South 50 feet thereof, Hennepin County,
Minnesota
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5
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 91
Agenda March 27, 1995
Issue Statement:
Amendment to a conditional use permit to allow the expansion of Fraser School, 2400
West 64th Street.
Background:
Fraser School has provided services to children with disabilities since 1935 and for
children with typical needs since 1988. The school at 2400 West 64th Street has been
in its present configuration since 1975.
Fraser has a current waiting list of over 100 children. The proposed expansion of
14,325 square feet would add classrooms, therapy room and office/meeting rooms.
Additional parking is required which necessitates the vacation of Queen Avenue along
the east side of their property.
The vacation will be considered in a separate action. A variance for rear yard setback
is also necessary.
Recommended Motion:
Approve the request for an amendment to the conditional use permit of Fraser School,
included the off-street parking, subject to the granting of a variance for back yard
setback, the vacation of Queen Avenue and a Storm Water Management Agreement.
Basis of Recommendation:
1. The Planning Commission unanimously recommended approval at its February 21,
1995 meeting.
2. The addition will provide more space to accommodate an over 100 children waiting
list.
3. The additional 14,325 square feet of space added to the existing 15,320 square feet
plus added basement area of about 4,000 square feet would require more parking.
This is provided along a vacated Queen Avenue as well as property east of Queen
owned by the school behind the doctor's office. An improved drop off and turn
around area will also be provided at the front entrance.
4. Storm water management can be provided on site. Staff has, however, been
working with representatives of both Fraser School and Lunds to deal with a
common solution to an area problem.
IV 5. Additional landscaping and fencing has been added to minimize impact on the
neighbors.
6. A variance hearing has been held relative to the back yard setback but no decision
has yet been received.
7. The vacation of Queen Avenue will be presented to the City Council later in April.
Alternative Recommendation:
The Council may deny the application based on adverse impact upon the neighbors or
the City as a whole.
Discussion/Decision Mode:
A public hearing is scheduled for March 27, 1995. Notice of hearing was published in
the Sun-Current and mailed to property owners within 350 feet of the subject property.
Respectfully submitted,
Jame . Prosser
City M ager
JDP:cak
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CITY OF RICHFIELD, MINNESOTA
Council Letter No. 90
Agenda March 27, 1995
Issue Statement:
Approve purchase of a new hydraulic knuckle boom loader with 18' box.
Background:
At the January 23, 1995 meeting, the City Council approved purchase of a log truck. The
cab and chassis have been ordered. Specifications were then written for a hydraulic knuckle
boom loader with an 18' box to fit the cab and chassis ordered. These specifications were
sent to seven vendors. The specification included an option for a specific continuous rotation
grapple, as well as requesting a trade-in price for the old log picker unit. A bid opening was
held on March 16, 1995 with the following result:
Base Bid Option Trade-In Total
Crysteel Truck Equipment 37,280 +3,950 (6,000) $35,230
Reach Equipment 46,113 +2,719 (9,250) $39,582
Lakeland Ford Trucks No Bid
Recommended Motion:
Accept the bid minutes/tabulation and approve the purchase of a hydraulic knuckle boom
loader with 18' box, along with Option, from Crysteel Truck Equipment in the total sum of
• $35,230.
Basis for Recommendation:
1. Crysteel. Truck Equipment submitted the low bid.
2. Crysteel Truck Equipment is a reputable vendor of truck equipment..
3. The approved 1995 Motor Pool budget contains funds for this purchase.
Alternative Recommendation:
Council could reject the bids and instruct staff to obtain-new ones; however, these bids came
in lower than expected, and staff does not believe we could obtain lower prices from
reputable vendors.
Discussion/Decision Mode:
Staff is requesting approval at the March 27, 1995 Council meeting in order to facilitate timely
delivery of the loader unit.
Resp u ly submitted,
James D.' Prosser
4
City Ma ager
.JDP:ds
CITY OF RICHFIELD, MINNESOTA
Bid Opening
March 27, 1995
11:00 a.m.
Hydraulic Knuckle Boom Loader w/18' Box
Bid No. 95-4
Pursuant to requirements of Resolution No. 1015, a meeting of the Administrative Staff
was called by Thomas P. Ferber, City Clerk, who announced that the purpose of the
meeting was to receive, open and read aloud, bids for hydraulic knuckle boom loader
w/18' box, Bid No. 95-4, as advertised in the official newspaper on March 1, 1995.
Present: Thomas Ferber, City Clerk
Donald Fondrick, Community Services Director
Cheryl Krumholz, City Manager Representative
Roxi Braa, Administrative Aide
Rick Beane, Community Services Foreman
9 Roach Equipment 5% Bid Bond Base Bid $ 46,113.00
The following bids were submitted and read aloud:
VENDOR Bid Security Bid Amount Addenda
Bloomington Option $ 2,719.00 yes
trade-in $ -9,250.00
TOTAL $ 39,582.00
Crysteel Truck Equip 5% Bid Bond Base $ 37,280.00
Fridley Option $ 3,950.00
trade-in $ -6,000.00
TOTAL $ 35,230.00
The City Clerk announced that the bids would be tabulated and considered at the
March 27, 1995 City Council Meeting.
Thomas P. Ferber City Clerk
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CITY OF RICHFIELD, MINNESOTA
Council Letter No. 89
Agenda March 27, 1995
Issue Statement:
Award of contract for one new asphalt patch box for use by the Street Maintenance Division.
Background:
The present asphalt patch box used by the Street Maintenance Division to contain, keep
warm and dispense asphalt for patching and repairing streets, was purchased in 1980. It
was due to be replaced in 1996; however, the accelerated street repair program approved by
the Council has necessitated the early replacement of this unit. Part of the funds for
purchase of a new unit will come from the Street Maintenance Division Fund, and the rest will
come from the Central Garage motor pool fund. The 1995 budget will be revised to show the
change.
Bids were opened Friday, March 10 from two vendors as follows:
Ruffridge-Johnson Company, Inc.
ABM Equipment & Supply, Inc.
$17,506.00
18,666.66
The Ruffridge-Johnson bid included an unasked-for deduct of $665 for a four-foot I-beam,
sling and shackles. Staff has reviewed the option, and. has decided to accept the deduct.
Recommended Motion:
Accept the bid minutes/tabulation and award a contract to Ruffridge-Johnson Company, Inc.
in the sum of $17,506.00 minus a deduct of $665.00 plus sales tax of $1,094.67 for a total of
$17,935.67.
Basis for Recommendation:
1. Ruffridge-Johnson submitted the low bid.
2. There are sufficient funds available in the Central Garage and Street Maintenance
divisions budgets for this purchase.
Alternative Recommendation:
Council could reject the bids and direct staff to obtain new bids for this unit.
Discussion/Decision Mode:
Staff is requesting approval at the March 27, 1995 Council meeting.
Respectf y submitted,
Jam'/ s . Prosser
City anager
JDP:ds
CITY OF RICHFIELD, MINNESOTA 01-1
Bid Opening
March 10, 1995
11:15 a.m.
One Asphalt Patch Box
Bid No. 95-7
Pursuant to requirements of Resolution No. 1015, a meeting of the Administrative Staff
was called by Thomas P. Ferber, City Clerk, who announced that the purpose of the
meeting was to receive, open and read aloud, bids for one asphalt patch box, Bid No.
95-7, as advertised in the official newspaper on February 15, 1995.
Present: Thomas Ferber, City Clerk
Donald Fondrick, Community Services Director
Cheryl Krumholz, City Manager Representative
Roxi Braa, Administrative Aide
•
The following bids were submitted and read aloud:
VENDOR Bid Security Bid Amount
ADM Equipment & Supply 5% Bid Bond Base $ 18,666.66
Hopkins Option #1 $ 680.00
Option #2 $ 1,880.00
Ruffridge-Johnson Equipment, Inc. 5% Bid Bond Base $ 17,506.00
Minneapolis deduct $ 665.00
The City Clerk announced that the bids would be tabulated and considered at the
March 27, 1995 City Council Meeting.
Thomas P. Ferber City Clerk
CITY OF RICHFIELD, MINNESOTA !
Council Letter No. 88
Agenda March 27, 1995
Issue Statement:
Award a purchase order for one high velocity sewer cleaner.
Background:
The sewer cleaner is used to maintain and clean 120 miles of sanitary sewer lines yearly.
The cleaner removes accumulated sand, silt, and grease in sanitary and storm sewer
lines. This equipment is essential and must be operational at all times in order to clear
emergency sewer blockages. The life expectancy of a sewer cleaner is six years and the
existing equipment is seven years old.
A formal bid opening for the purchase of one high velocity sewer cleaner unit was held on
Friday, March 10, 1995 with the following results:
Vendor Base Bid Trade-In Total Bid
Crysteel Truck Equipment $42,721.00 $ 6,500.00 $36,221.00
Flexible Pipe & Tool Co. 53,771.70 15,000.00 38,771.70
ABM Equipment & Supply 71,188.88 32,300.00 38,888.88
Recommended Motion:
Accept the bid minutes/tabulation. Reject the bid from Crysteel Truck Equipment becasue
they did not meet written specifications on several important pieces of the cleaner like the
pump and its housing. Award a purchase order to Flexible Pipe & Tool Company, the
second lowest bidder, in the amount of $38,771.70 plus $2,520.16 sales tax, for a total
purchase price of $41,291.86.
Basis of Recommendation:
1. Crysteel Truck Equipment did not meet specifications as written.
2. Flexible Pipe & Tool Company met all requirements and is a reputable vendor.
3. There is $75,000 allocated for the purchase of the truck chassis and sewer jet
cleaner. The truck chassis has already been purchased at a price of $36,462.
Alternative Recommendation:
Council may reject all bids and direct staff to readvertise; however, staff does not believe a
better price can be obtained from a reputable contractor.
Discussion/Decision Mode:
Staff is asking for approval at the March 27, 1995 Council meeting.
Respectful ubmitted,
osser
Jame rageir
City M JDP:ds
•
CITY OF RICHFIELD, MINNESOTA
Bid Opening
March 10, 1995
11:00 a.m.
High Velocity Sewer Cleaner
Bid No. 95-5
Pursuant to requirements of Resolution No. 1015, a meeting of the Administrative Staff
was called by Thomas P. Ferber, City Clerk, who announced that the purpose of the
meeting was to receive, open and read aloud, bids for high velocity sewer cleaner, Bid
No. 95-5, as advertised in the official newspaper on February 15, 1995.
Present: Thomas Ferber, City Clerk
Donald Fondrick, Community Services Director
Cheryl Krumholz, City Manager Representative
Roxi Braa, Administrative Aide
•
The following bids were submitted and read aloud:
VENDOR Bid Security Bid Amount
Flexible Pipe Tool Co. 5% Bid Bond Base $ 53,771.70
St. Cloud trade-in $ - 15,000.00
TOTAL $ 38,771.70
ABM Equipment & Supply Inc. 5% Bid Bond Base $ 71,188.88
Hopkins trade-in $ -32,300.00
TOTAL $ 38,888.88
Crysteel Truck Equipment 5% Bid Bond Base $ 42,721.00
Fridley trade-in $ -6,500.00
TOTAL $ 36,221.00
The City Clerk announced that the bids would be tabulated and considered at the
March 27, 1995 City Council Meeting.
Thomas P. Ferber City Clerk
0
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CITY OF RICHFIELD, MINNESOTA
Council Letter No. 87
Agenda March 27, 1995
Issue Statement:
Award of bid for contract for demolition and removal of buildings at 6913 Penn Avenue
and 6933 Penn Avenue; Storm Water Capital Improvement Program.
Background:
On September 12, 1994, the City Council approved just compensation and authorized
the purchase of 6913 and 6933 Penn Avenue as part of the Storm Water Capital
Improvement Program. The subject properties were purchased shortly thereafter.
During December 1994, bids were mailed to house moving contractors to submit bids
for the purchase and removal of the houses. No bids were received. Inquiries to house
movers revealed that the houses were marginal and the cost to move them off site
prohibitive.
Subsequently, staff drafted bid specifications for the demolition and removal of the
subject buildings. On March 3, 1995, eight demolition contractors were mailed bid
packets to submit one bid for both properties.
On March 17, 1995, a bid opening was held. Four contractors submitted bids. Two
bids were disqualified due to non-compliant submittals. Of the two remaining qualified
bidders, the lowest bid was submitted by Apple Excavating, Inc. in the amount of
$7,450. (See attached bid tabulation sheet.)
Recommended Motion:
Approve the bid minutes/tabulation and award the contract for demolition and removal
of buildings at 6913 Penn Avenue and 6933 Penn Avenue to Apple Excavating, Inc. in
the amount of $7,450.00.
Basis of Recommendation:
1. The recommended, bidder for the demolition and clearance contract submitted the
lowest complete bid.
2. All appropriate guidelines for letting bids were followed.
3. The buildings on the property would continue to incur property maintenance costs if
not removed.
Alternative Recommendation:
1. The City Council may choose to reject all bids.
L4 F-f
Discussion/Decision Mode:
The bid must be awarded prior to the execution of a contract for demolition and
clearance of the subject buildings.
Respectfully submitted,
Ja a Prosser
Cit Hager
JDP:ds
•
0
•
CITY OF RICHFIELD, MINNESOTA
Bid Opening
March 17, 1995
12:00 Noon
Demolition And Clearance Of Properties At 6913 and 6933 Penn Avenue South
vF a
Pursuant to the requirements of Resolution No. 1015, a meeting of the Administrative Staff was
called by Thomas P. Ferber, City Clerk, who announced that the purpose of the meeting was to
receive, open and read aloud bids for the demolition and clearance of properties at 6913 Penn
Avenue South and 6933 Penn Avenue South, Richfield, MN, as solicited by mail on March 3,
1995.
Present: Thomas Ferber, City Clerk
Byron Wallace, Community Development Director
Cheryl Krumholz, City Manager Representative
Katia Medvetski, Redevelopment Specialist, Community Development
•
•
The following bids were submitted and read aloud:
Bid Security Bid
Vendor $11000.00* Submitted
S. R. Stevens Excavating $1,000.00 $11,000.00
Farmington, MN Money Order
Apple Excavating $1,000.00 $ 7,450.00
Bloomington, MN Money Order
Bjorkman Excavating $1,000.00 $15,520.00
St. Paul, MN Cashier's Check
Ceres Contracting 5% $12,449.00
St. Paul, MN Bid Bond
*Bid Security required to be in the form of cashier's check, certified check, or money order.
The City Clerk announced that the bids would be tabulated. Katia Medvetski announced that the
bids would be reviewed to determine bid submittal compliance and that the award for the bid
would be considered at the March 27, 1995 City Council Meeting.
Thomas P. Ferber, City Clerk
?{C
• CITY OF RICHFIELD, MINNESOTA
Council Letter No. 86
Agenda March 27, 1995
Issue Statement:
Purchase in excess of $5,000 for summer brochure printing.
Background:
The City Council policy resolution on purchasing provides that when the purchase of
merchandise, materials, equipment or construction is in excess of $5,000, authority to
purchase shall be submitted to the City Council for consideration.
The quarterly brochure is being printed on a quarterly basis for 1995 because of
changes in the computer. system. Each quarter, staff has different capabilities in
providing information on disk to the printer and preferred to take advantage of those
differences for potential cost reduction. Five printers were contacted for summer
brochure quotes. Nystrom Publishing submitted the lowest quote of $5,498 for printing
the 24 page brochure on recycled paper. The Community Services budget contains
sufficient funds for this purchase.
Quotes were as follows:
. Artcraft Press $5,874.75
Nystrom Publishing $5,498.00
Park Printing $8,640.00 (without recycled paper)
Sexton Printing $7,898.00
Shakopee Valley Printing $7,615.00
Recommended Motion:
Approve a purchase order in the amount of $5,498 for printing the summer quarterly
brochure on recycled paper to Nystrom Publishing.
Basis of Recommendation:
1. Nystrom is a quality printer who has done recreation brochures for other communities
and submitted the lowest quote for the work.
2. Adequate funding is available for the work.
Alternative Recommendation:
1. Council may chose another printer from the list who submitted quotes.
2. Council may reject all quotes and request staff to look for another printer; however,
staff believes Nystrom has submitted a very good price and any delay will result in
. difficulty getting the brochure to the residents on time.
q01)
Discussion/Decision Mode:
To meet the delivery deadlines so all homes receive the brochure prior to registration
day, staff is requesting approval at the March 27, 1995 meeting.
Respectfully submitted,
g a D. Prosser
ty anager
JDP:ds
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CITY OF RICHFIELD, MINNESOTA
Council Letter No. 85
Agenda March 27, 1995
Issue Statement:
Payment in excess of $5,000 to the League of Minnesota Cities Insurance Trust.
Background:
The City purchases general liability insurance from the League of Minnesota Cities
Insurance Trust with Berkley Risk Services, Inc. as Administrator. The City's insurance
policy has a $50,000 deductible for liability claims. In 1986, the City significantly
reduced its premium by having a large deductible. The premium savings and additional
monies have been used to create a Self-Insurance Fund to cover payments made
which are under the deductible as claims arise.
On February 2, 1992, a Richfield police officer arrested the claimant for driving while
intoxicated. The claimant alleged discrimination because he did not have access to an
interpreter or a telecommunications device for the deaf and claimed he was falsely
imprisoned.
The United States District Court, District of Minnesota, Fourth Division granted the
• City's Motion for Summary Judgment and dismissed all claims against the City and the
police officer. However, the City incurred legal expenses in defending the action in the
about of $9,907.92. Since these expenses fall below the City's deductible limit, the City
is directly responsible for the payment.
Recommended Motion:
Approve the payment to the League of Minnesota Cities Insurance Trust in the amount
of $9,907.92.
Basis for Recommendation:
1. The City's insurance policy provides that the insurance carrier shall, at its
discretion, investigate, settle, or defend any claims or suit against the City. In
having the court settle this claim, the League of Minnesota Cities Insurance Trust
incurred legal expenses.
2. Funding is provided for defense or payment of claims costing less than the
$50,000 deductible.
Alternative Recommendation:
None.
0
4D-I
Discussion/Decision Mode:
This item is on the March 27, 1995 regular City Council meeting consent calendar.
Payment should be made to reimburse the insurance carrier as quickly as possible.
Respectfully submitted,
Ja #n D. Prosser
Cit ager
JDP:cak
BERKLEY RISK SERVICES, INC.
DATE: 03/16/95
RICHFIELD CITY OF Attn: Finance Dept.
6700 PORTLAND AVENUE SOUTH
RICHFIELD MN 55423
RE: BRS CLAIM NO.: 02726193
TRUST MEMBER: RICHFIELD CITY OF
CLAIMANT: WARNER
DATE OF LOSS/OCCURRENCE: 02/03/92
CLAIMS MADE DATE: 02/01/93
The above claim has been concluded
This claim occurred when -
ALLEGED DISCRIMINATION DURING ARREST
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MAR 17 1995
On behalf of your city, we have paid the following to conclude
this claim:
Paid Losses Paid Medical Paid Expenses Total
.00 .00 9,907.92 = 9,907.92
Ded.Recover Prior/Aggregate Prior/Aggregate
This Bill This Claim This Covenant
-9,907.92 .00 -39,284.14
Your city's deductible is $50,000 per occurrence/$300,000 annual
aggregate/$1,000 per loss per line of coverage (after aggregate is
exceeded). This applies under covenant number CMC1277693 effective
07/01/92 thru 07/01/93.
Accordingly, please prepare a draft made payable to the "LEAGUE OF
MINNESOTA CITIES INSURANCE TRUST" in the amount of $ 9,907.92
and forward it to Berkley Risk Services,Inc., 920-2nd Ave. So.
Minneapolis, MN 55402-4023, Attention: Finance Department.
Please include our claim number, as captioned above, with
your remittance to insure proper credit.
Should you have any questions relative to the disposition of this
claim, please do not hesitate to contact the BRS examiner who
supervised this claim, BOB WEISBROD at 1-800-618-0484,
or locally at 612-376-4271.
Sincerely,
Margo Wecker
Finance Department
Agent of Record: JOHNSON & HIGGINS, INC.
333 SOUTH SEVENTH STREET
SUITE 1600, LINCOLN CENTRE
MINNEAPOLIS MN 55402
C cc: Ms. Sheryl Sattler, BRS Finance Department
SIG
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 84
Agenda March 27, 1995
Issue Statement:
Consideration of "Consent and Agreement" relating to Emerson Avenue Licensure
Agreement and the Colfax Avenue Agreement; CSM, Phase I.
Background:
CSM is negotiating permanent financing for Phase I of Shops at Lyndale with Allstate
Life Insurance Company in the amount of $12.9 million. The City Council on August 1,
1994 approved a Licensure Agreement with CSM for use of Emerson Avenue between
77th and 78th Streets for parking. Subsequently on February 27, 1995, the City
Council approved an agreement related to Colfax Avenue.and also approved
assignment of the Emerson and Colfax Avenue agreements to the lender.
Recommended Motion:
Approve the "Consent and Agreement" relating to Emerson Avenue Licensure
Agreement and the Colfax Avenue Agreement; CSM, Phase I.
Basis of Recommendation:
1. CSM and Allstate are requesting approval.
2. The City has previously made assignments of Colfax and Emerson to CSM and
then to Allstate.
3. The main purpose of the document is to provide for the redesign of the Colfax
Avenue entrance so that it does not interfere with the operation of the car
dealership south of 77 1/2 Street.
Alternative Recommendation:
1. Delay action.
2. Refuse to approve
Discussion/Decision Mode:
Approval on March 27, 1995 will facilitate a closing between CSM and their lender.
Staff will respond to questions and review the document at the March 27 meeting.
Resp I submitted,
Jame . Prosser
City Manager
JDP:cak
MAR-22--26 12:22 FROM:HOLMES & CRAVEN ID:6123379310 PAGE 3/23
CONSENT AND AGREEMENT
This Commit and Agreement is made as of 1995, by and
between THE CITY OF RXiMELD, a letinnesota municipal corporations, whose address is
6700 Portland Avenue South, Richfield, Minnesota 55423 (the "City"'), ALLSTATE LIFE
INSURANCE CONfPANY, an Illinois insurance corporation, whose address is Allstate Plaza
West Wr, 3100 Sanders Road, Northbrook, Illinois 60062 (the "L.enderl, and CSM
DXESTORS, NC., a Minnesota corporation, whose address is 2561 Territorial Road, St.
Paul, Minnesota 55114-1500 (tl,.e "Developer" )_
WI Eg EAS, the City and the Developer have entered into an Agreamcnt dated
as of August 9, 1994, as amended by Rewlution dated January 23, 1995 (the "Emerson
Agreernene) relating to that portion of Emascrs Avenue South which is legally described on
Exhibit A attached hereto (the "Emerson Portion").
WHEREM, the City and the Developer have entered into an Agreement dated
February 29, 1995 (the "Colfax Agreement') relating to that portion. of Colfax Avenue South
which is legally described on Exhibit E attached hereto (the "Colfax Portion").
WHEREAS, the Lender has agreed to make a loan of $12,900,000 (the
"I&nder Load) to the Developer upon the condition, among others, that the Developer grant
the Lender a Mortgage, Assignment of Leases, Rents and Contracts, Security Agreement and
Fixture Piling (as the same may be amended and supplemented from time to time, the " L aader
Mortgage") and an Assignment of Leases and Rents (as the same may be mended and
supplemented from time to tin-, the "Lender Assignment of Rents'), as security for
repayrrient of such financial accommodations, covering certain real estate, including, without
limitation, the real estate legally described in Exhibit C attached hereto (the "Land") and the
City is willing to execute this Consent and Agreement to induce the Lmdex to provide such
financing to the Developer.
NOW THEREFORE, the parties 1 treto hereby agree as follows'
1. Amendment of A rep merit. The Developer and the City hereby
acknowledge that the Emerson Agreemenu was amended by Resolution dated January 23,
1935 to delete as a basis for terminating the Emerson Agreement, a default by Developer
under that certain Contract for Private Development dated April 29,1994 between The
Housing and Redevelopment Authority in and for the City of Richfield, Mi oeesota l
" " . and CSM Corporation as amended by Resolution No. 529 -v.d Novernber 21,
'Resolution No. 530 dated Nover,iber.21, 1994, and Resolution No. 543 dated February
29, 1995 (the "Development Cantrar,*-' ,:x coooection with Phase Il Property (as defined in
the Development contract),
MAR-22-55 12:23 FROM : HOL.MES & GRAVEN 10:812337S310
Y.J..SI L'. 1+ JJ l.y • } v . ..??+..... ... .rte....: .. ._ _._.. _ . _
PAGE 4x'23
2. No Defaults Under Emerson AP-Teemerrt. To the best of the City's
knowledge and to the best of the Developer} s knowledge, no default has oet:urred under
paragraph 8 of the Emerson Agreement, and no event, which with the PawMe of time or the
giving of entice, or both, would be such a. default, has occurred and is continuing trader the
Emerson Agreement as of the date hereof.
3. No Defaults Under Colfax-ba eem To the best of the City's
knowledge and to the best of the Developer's knowledge, no default has oceuwr-ed under
paraamph s of the Colfax Agreement, and no event, which with the passage of time or the
giving ofnotioce, or both, would be such a default, hits occurred and is continuing under the
Colfax Agreement as of the date hereof.
4. Assiment of Astreernetrt and Rights there?mder to the l;,ender. The
Developer hereby assigns to the Lender. as security for the Lender Loan, all of the
Developer's right, title and interest in and to the Emerson Agreement and the Colfax
Agreement, as amended by this Consent and Agreement, and to the rights of the Developer
under the Emerson Agreement and under the Colfax Agreement ' be City hereby consents to
this assigxament.
5. Emerson Agreement Estoppel Letter, The City admowledges that
(a) that tertain estoppel letter dated March 7, 1995, from the City, and (b) that certain opinion
letter dared March 9, 1995, from counsel for the City relats to the Emerson Agreement, are
valid, legal, binding and enforceable obligations, and, as of the date hereof, have not been
modified, supplemented, or amended.
6. Colfax A regiment Esfo .jme4 setter. The City acknowledges dud (a) that
certain estoppel letter dated Ma?rrb 3. 1995, from the City, and (b) that certain, opinion letter
dated March 9, 1995, from counsel for the City relating to the Colfax Agreement, are valid,,,
legal; binding and enforceable obligations, and, as of the date hereof, have not been modified,
sugplernentsd or ammided.
7. Dftiq?x of Main Access.. Pursuant to the Provisions of par sph 2 of
the Colfax Agreement, the City consents to the modified design layout for the new entryway,
in accordance with the design layout shown on Exhibit D attached hereto, until completion of
the entryway m accordance with the Fi rial Development Plan (as defined in the Denlopment
Contract). The City acknowledges that paragraph 2 of the Colfax Agreement requires
completion of the entryway in accordance with the design layout shown on Exhibii D and
further acknowledges that paragraph 8(c) of the Colfax Agreement provides that Developer
shall not be in default tinder paragraph 8(c) of the Colfax Agreement twin Developer fails to
complete the construction of the new enuywacy in accordm= with the design layout shown on
5Nbit 0,
-2-
MAR-22-SS 12:23 FROM:HOLMES & CRAVEN ID:6123379310 PAGE SJ23
• C-3
8: Consent to Lender M e and Lender Asst Brit cif Rents. The
tarty hereby consents to the Lender Mortgage and the Lender A.signment of Rents covering
the Land,
9. . Access to A.d"oinin Land. The City acknthwledges that the entryway
when constructed is accordance with the design layout shown, on Exhibit D attached hereto
and in accordance with the Final Development Flan (as defined m the Development Plan)
shall provide an access to the public or the ow'rcers, temts and invitees of the par l.s which
lie east of the Colfax portion, west of Lyndale Avenue South and along 77 112 Stmt over and
across the Colfax Portion. .
10. City Support for Vacation of Colfax Avenue. The City ackfLowledges
that it presently knows of no facts that would muse it to deny a request by Developer for a
vacation of the public right of way across Colfax Avenue South.
11. Obligation of City to Make aNew Emerson Aar .ent with the
Lender. If the Developer's interests under the Emerson Agreement or in the EmeMon Portion
shall be terminated as a result of the rejection or disaf rmance of the Emerson Agreement
pursuant to bankruptny lawn or other law affecting creditor's rights or shall be terminated by
the City bemuse of a Default or for any other reason other thaw the City's providing to the
Developer an alternative parcel of real estate for access and parking in lieu of the Emerson.
Portion in accordance with paragraph $(b) of the Emerson Agt memt, the City will enter into
a new agreement with the Lender, or any party designated by the Lender, not less than 10 nor
more than 30 days after the request of the Lower, effective as of the date of such rejection,
disaff"irrnance, or termination, which new agreement shall be upon the same terms and
condition as are presently contained in the Emerson Agreement, a=ept that such new
agreement shall not include any right by the City to terninaxe the new agreement under the
circumstances set Rdh in paragraph &(a) of the Emerson Agreement The provisions of this
paragraph l l shall survive the rejection, disaffamanoe or tern-?nation of the Emerson
Agreement or the rights of the Developer thereunder and shall continue in full effect
thereafter i msmuclh as this Consent and Agreement is a separa$e and independent contrwt
trade by the City and the Lender. From the effoo ve date of such rejection, disaffirmanM or
termination of the Emerson Agreement to the date of execution and delivery of such now
agreement, the Leader may use and enjoy the rights and pdviie s created by the Emerson
ASreement without hindrance by the City.
enuwed i 2 to his as
6
12, Obliaa?iprt of Cipt to Make aNew -Colftx with the 1nder.
1 If the Developer's interests under the Colfax Agreement or ii't the Colfax Portion shall be
terminan d as a result of the rejection or disaff'irmance of the Colfax Agreement pw-wwt to
bankruptcy law or other law affecting creditor's rights or shall be terminated by the City
-3-
MAR-22-95 12:24 PROM:HOLMES & GRAVEN 10:9123379310 PAGE 8/23
because of.a Default or for any other reason, the City will enter into a new agreement with the
Lender, or any pasty desipated by the Lender, not less than 10 nor amore than 30 days after
the request of the Lender, effective as of the date of such r6 eotion, disaffirrnanee, or
tctznination, which new agreement shall be upon the same terms and cOndshOns as are
presently contained in the Colfax Agreement, except that such new agreement shalt not
include any right by the City to terminate the new agreement under the circumstances set forth
in paragraph 8(a) of the Colfax Agreem+ent..The provisions of this par ph 12 shall survive
the rejection, disaffmnance or termination of the Colfax Agreement or the rights of the
Developer thereunder and shall continue in full effect the er inasmuch as this Consent and
.A Vr ement is a separate and independent contract made by the City and the Lender. From the
effective date of such rejection, disaf romance, or teTmirztion of the Colfax Agreement to the
date of execution and delivery of such new agre went, the Lender may use and enjoy the
rights and privileges created by the Colfax Agreement without hi arxoe by the City,
mgm havc pursuant to That 22dW Limited &M= Tax juc=ent Note (Ph" 1) A-ad
'in the aM= of $I 969-Q36-
13 . Exemption frorn__Ass>?gnznant Restrictions. The City and the Omloper
agree that the assignment restrictions conW yed in paragraph 12 of the Emerson Agreement
shall not prevent the Leander from further assigning all of its right, title, and interest -in and to
the Emerson Agreement and the rights thereunder or to any new agreement entered into
pursuant to paragraph 11 of this Consent and Agreement, to any assignee, provided that the
Lender is also assigning all of its right, title and interest in arxd to the Land to such assignee.
14. Exemntian from ttssi ens Restrictions. The City and the Developer
agree that the assignment restrictions contained in paragraph 12 of the Colfax AgreemeM
shall not prevent the Lender from further assigning all of its tight, title, and interest in and to
the Colfax Agreement and the rights thereunder or to east, new agreement entered iota
porsusnt to paragraph 12 of this Consent and Agreement, to any assignee, provided tW the
Lender is also assigning all of its, right, title and interest in and to the Land to such ass =.
15. 1Vo E?amealdrnent to ,4txreemcots. Without the varritten oonsent of the
Lender, the Emerson Agreement and the Colfax Agreement shall not be amended by the City
or the Developer, and the City shall apt no voluntary terminafion or surrender of the
Emerson Agreernent? the Colfax Agreement, the Emerson Portion or the Colfax Portion by
the Developer.
16. Option to Purchase. 'The City will provide written notice to the Lender
six Igtaneously with any written notice pEpvided tc the Developer informing the Developer
that the Developer may exercise its option to purchase the Emerson Portion porsuamt to
pamgmph 8(o) of the Emerson Agreea;aaent. if for any reason the Developer fails to edge
-4-
MAR-22-95 12:25 PROM:HOLMES & GRAVEN ID:el23379310 PAGE 7/23
q C-5-
th8 oghgn to puTChc'1Se! the Emerson Portion, the City 8$t'ees that the Lender may exercise the
option to purchase the Emerson Portion on behalf of the Developer,
i 7. ernedies Cumulative, The Lender" s rights hereunder are cumulative
and not elusive.
19, Eenefit Phase T. The Lender acimowledges that the Emerson
,ggrewwnt, the Colfax Agreement, any new agreement entered into pursuant to p&V raphs 11
and 12 of this Consent and Agreement acrd the Ernemon Portion which Lender may acquire
pursuant to paragraph 16 of this Consent and Agreement sIWl benefit the Phase Y Property EM
defined in the Development Contract)_
19. Terlnirl & n. of this Consent and A e e t. The Lender agrees that i£
the Lender Loan is hilly paid by the Developer, the Lend will m=ute and deliver a
termiration of this Consent and Agm=ern simultaneously with the Lender's execution and
delivery of a satisfaction with respect to the Lender Mortgage,
nq WITNESS WHEREOF, the parties have signed this Agreement as of the
day and year first above wriftn.
0 TEE CITY OF MCA FIELD
BY
Its Mayor
BY
its city manager
.5-
MAR-22-SS 12:25 FROM:HOLMES & GRAVEN] IO:812337S310 PAGE A/23
STATE OF MINNF,SOTA )
)ss.
COUNTY OF
ALLSTATE LIFE INSURANCE COMPANY
By
By
- -
Its AtAorized ftaxories
CSM Ili TSTORS, INC.
Its
BY
The foregoing instrument was acknowledged before me this ____ day of
1995, by and
. mpectivrAy the Mayor and the City Manager of The City of
Richfield, a Minnesota municipal corporation, on behalf of said corporation.
Notary Public
4
-6-
MAR-22-9S 12:26 FROM-.14OLME9 & GRAVEN ID:5123379310
• STATE OF _.. )
S&
COUNTY Of I
` The foregoing, inmrameni was acknowledged before me this day of
1995, by and by
_ the and she of
Allswe Life Insurance Company, an I[lincis insuramce corporation, on behalf of said
corpoiahon,
STATE O M NNESO'T`A )
? ssCOUNT Y OF
PAGE 9123
q- C-9
Notary Public
. The foregoing instrniment was acknowledged bdore me thus - day of
1995, by the of CSI
Investors, Inc., a Miaaesota corporatton, on behalf of said corporation.
Notary Public
This instrument was drafted by:
Faegre & Benson (R K)
2200 Norwest Center
90 South Seventh Strut
Minneapolis, Minnesota 55402-3901
i
-7-
MAR-22-S5 12:2E FROM:HOLMES & GRAVEN I0:612337S310 PAGE 10/23
(4C--9
.EXMMIT A
TO
CONSENT AND AGREEMENT
The real, es a described in the referm=ed instrument and referred to as the
Fm erson Portion is locaed in Hennepin County, Miavesobl and is legalty described as
follows:
That part of the West 30 fbet of the East Half ofthe Southeast Quarter ofthe
Southwest Quarter of the Southeast Quarter of. Simon 33, Township 28,
RAW 24, Hennepin County, Minnesota which lies South of the North 240 feet
thereof except part taken for highway.
and
The East 30 feet of the West Half of the Southeast Quarter ofthe Southwest
Quarter of the Southeast Quarter of Section 33, Township 28, Range 24,
Hennepin County, Mianamta, m=pt that part W= for higher purposes.
and
The West 30 feet of the North 240 feet of the Fast I-Wf of the Southeast
Quarter of the Southwest Quarter of the Southeast Qumtar of Section 33,
Township 28, Rmge 24, Hennepin County, Minnesota
i
0
MAR-22-85 12:28 FROM:HOLMES & GRAVEN ID:S12337S310 PAGE 11/23
E 13ff 1a
TO
CONSENT AND A+;REEMENT
The real estate described in the referenced mar went and. referred to as the
Colfax Portion is located in Hennepin County, Minnesota, and is legally described as follows.
The North 255 feet of the East 30 fee of the West 320 feet of the South Half of
she Southeast Quarter of the Swtheast Quarter of Section 33, Township 28,,
Range 24, Hennepin County, Minnesota,
and
The South 90 feet of the North 345 feet of the Fast 30 feet of the West 320 feet
of the South Half of the Southeast Quarter of the Southeast Quarter of Section
33, Township 28, Range 24, Herirtepizr County, Minnesota,
and
The South 89.92 feet of the North 434.92 feet of the Est 30 feet of the West
320 feet of the South Half of the Southeast Quarter of the Southeast Quarter of
Section 33, "Township 29, Range 24, Hennepin. County, Minnesota,
and
All that part of the Fast 30 feet of the West 320 feet of the South Half of the
Southeast Quarter of the Southeast Quarter of Secti= 33, Township 28, Range
24, Hennepin County, Minnesota, EXCEPT the North 434.92 feet thereof and
the parts thereof taken for highway purposes,
and
That part of Colfax Avenue South as dedicated in the plat of STR.AND-
BOWEN SECOND ADDITION, which lies northerly of the center line of
West 77 1i2 Street as dedicated in said phd and which lies southerly of the
westerly errtension of the north line of Lot 11, Block 1, in said plat, ,
and
That part of Colfax Avenue South as dedicated in the plat of STRAND-
BOWEN SECOND ADDMON, which lies southerly of the centerline ofWest
77 112 Street as dedicated in said plat.
MAR-22-9S 12:27 FROM:14dLM1rS & GRAVEN 1D:9123379310 PAGE 12123
qC-1C)
EXHIBIT C
TO
CONSENT AND AGREEMENT
The Property described in the referenced instrmemt is located mi H epin.
County, Minnesota, and is described as follows'
PARCEL I:
The North 240 feet of the East 1/2 of the Southeast 1/4 of the Southwest 114 of the Southeast
1 /4 of Section 33, Township 228, Raage 24 except the North Thirty (30) feet as described in
Book 1957 of Deeda, page 432, Hennepin County, Minnesot&
PARCEL 2:
The East 160 feet of the South 50 feet of the North 255 feet of the West 320 feet of the South
1/2 of the Southeast 1/4 of the Southeast 114 of Section 33, Township 28, Raage 24 except
the East 30 feet, according to the United States Cove neat Survey thereof and situate in .
Hennepin County, Minnesota.
PARCEL 3-,
The North 255 feet of the West 320 feet of the South 1/2 of the Southeast 1/4 of the Southeast
1 /4 of Section 33, Township 28, North Mange 24, West of the 4th Principal Meridian, except
the Fast 30 feet thereof and except the west 130 feet of the East 160 :feet of the South 50 feet
thereof, Hennepin County, Minnesota.
PARCEL 4:
The South 90 feet of the North 345 feet of West 320 feet of the South One-half (S 1 /2) of the
Southeast Quarter (SE 1 /4) of the Southeast Quarter (01 /4) of Section Tb rty three (33),
Township Tweri"ight (29) North, Range Twenty-four (24), West of the 4th Principal
Meridian, except the Eao 30 feet thereof, sccordin,g to the Vnited States Govemment Survey
thereof, Hennepin County,' Minnesota.
PARCEL S
All that part of the West 320 feet of the South I/2 of the SEi/4 of the SEE/4 of Section 33,
Township 28, Range 24 except the North 345 feet thereof and except the parts thereof taken
for highway purposes and except for Colfax Avenue South and Market Drive, according to
the United States Survey thereof, Hennepin County, MLaftesota.
MAR-22-95 12:27 PROM:HOLMES & GRAVEN ID:9123379310 PAGE 13/23
PARCEL 6,
That part of the Bl /2 of the SEIA of the SW1/4 of the SE114 of Section 33, Township 28,
Range 24, which lies South of the North 244 feet thered, kept that part taken for highway,
Hennepm County, Minnesota.
PARCEL 6A:
All of Lot 8, exeept the Easterly 4.5 feeC thereof. Lots 9 to 11, inclusive, Bloch 1, .
STRAND-BOWEN SECOND ADL7TI ON, according to the ret*rded plat thereof,
Hen spin County, Minnesota,
and
That part of the northerly half of West 77112 Street as dedicated in the plat of
STRAND -BOWEN SECOND ADDIT ON, according to the recorded plat thereof.
H epin County, Minnesota, which lies westcrly of the southerly amision cif the
west line of the easterly 4.5 fit of Trot 8, Block 1, of said plat,
and
That pmt of the southerly half ofWest 77 112 Street as dedicated in the plat of
STRAND-BOWEN SECOND ADDMON according to the recorded plat therw£,
Hennepin County, Minnesota, which lies westerly of the southerly extension of the
west line of the easterly 4.5 feet of L at 8, Flock 1, of said plat,
and
That part of Colfax Avenue South, as dedicated in the plat of STRAND-BOWEN
SECOND ADI)MON, as platted and recorded, Hennepii, County, Minnesota, which
lies northerly of the center line of West 77 112 Stret as dedicated in said plat, and
which lies southerly of the westerly extension of the north line of Lit 11, Block 1, in
said plat.
PARCEL, T
The North 30 feet of the East half of the Southeast Quarter of the Southwest Quarter of the
Southeast Quarter of Section- 33, Township 28, Range 24, Iennepin County, Minnesota.
PARCEL. 8:
That part of the following de=ri6ed properties:
-2-
MAR-22-SS 12:26 PROM:HOLMES & CRAVEN ID:812337S310 PAGE 14}23
•
qC-10-
The South. 85 feet of the West half of the East half of the Northeast Quarter of the
Southwest Quarter of the Southeast Quarter of Section 33, Township 28, Range 24,
Hennepin County, Minnesota
and
Lot 8, NORTIFELT ADDITION, Hennepin County, Minnesota
and
Vacated or unvacated 77th Street West, as dedicated in the plat of NORTHFELT
ADDIT ON, Hennepin County, Minnesota.
•
I
Being descibed as follows-
Commencing at the southeast cower of the Northeast Quarter of the Southwest
Quarter of the Southeast Quarter of said Section 33; thence South 89 degrees 41
minutes 41 seconds West, assumed bearing, along the south line of said Narthwest
Quarter of Southwest Quarter of Southeast Quarter 86.58 feet to the point of beginning
of the parcel to be described; thence northwesterly 187.04 feet along a non tangential
curve concave to the northeast }Yawing a radius of 610.33 feet and a central angle of 17
degrees 33 minutes 32 seconds, the chord of said curve bears North 63 degrees 29
minutes 13 seconds West; thence South 38 degrees 06 minutes 35 seconds West, not
tangent to said curve, 32.47 feet; thence southerly along a tanWtiW curve concave to
the east having a radius of 120.04 feet to the south line of said Northeast Quarter of
Southwest Quarter of Southeast Quarter, thence North 89 degrees 41 minutes 41
seconds East along said south line to the point of beginni S.
PARCEL C-.
That part of the west 30 The of the East Half of the Southeast Quarter of the Southwest
Quarter of the Southeast Quarter of Section 33, Township 2$, Range 24, Hennepin Colony,
Minnesota which lies south of the north 240 feet thereof, except part taken for highway-
PARCEL l:
The Noath.255 feet of the East 30 feet of the West 320 feet of the South Half of the Southeast
Quarter of the Southeast Quarter of Section 33, Township 28, Range 24, Hennepin County,
Minnesota,
-3-
MAR-22-SS 12:29 FROM:HOLMES & GRAVEN II7:6123379310 PAGE 15/23
qC-13
PARCEL J:
The South 90 feet of the North 345 feet of the East 30 feet of the West 320 feet of the South
Half of the Southeast Quarter of the Southeast Quarter of Sec;d0n 33, Township 28, Range 24,
Hennepin County, Minnesota-
PARCEL K:
The South.83.92 feet of the North 434.92 feet of the East 34 feet of the West 320 feet of the
South Half of the Southeast Quarter of the Soudwast Quarter of Section 33, Township 28,
Range 24, Hennepin County, Minnesota.
PARCEL L.
Pill that part of the East 30 feet of the West 324 feet of the South Half of the Southeast
Quarter of the Southeast Quarter of Section 33, Township 28, Range 24, Hennepin County,
Minnesota, EXCEPT the North 434.92 feet thereof and the parts thereof taken for highway
purposes.
PARCEI., M-
That part of Colfax Avenue South as dedicated in the plat of STRAN7D-I30'SN;N SECOND
ADDITION, as platted and recorded„ Hennepin County, Minnesota, which lies southerly of
the centerline of West 77 1/2 Street as dedicated in said plat.
o?:uu3sz?u,?
3/7)143 t 3)PM
-4-
MAR-22-95 12:29 FROM:HOLMES & GRAVEN ID:9123379310 PAGE 161'23
b?/15153b U9:11 Y•AA 01L 040 L4vq %,am 4urrVnn.LLV1% %JVVII Vl-a--
9 5/14.% 18:00 r'ASORE AND BENSON { 612 646 2404 NO.929 00
BEST BUY
60 S.F.
-? 4
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MODW MAIN ACCESS DRIVE
00
4
s. !
f j r.
OF AROKA Y LINE y _yNl;?
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PHASE 11
148
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 83
Agenda March 27, 1995
Issue Statement:
Consideration of removal of stop signs at 76th Street and Emerson Avenue.
Background:
As part of the City's plan to reconstruct 77th Street, 76th Street was changed from minor
arterial to a collector street. Over time, traffic on 76th Street will decline as people
become aware of the higher level of service provided by 77th Street.
The completion of the first phase of the 77th Street Project has prompted City Engineering
staff to recommend the removal of four-way stop signs on 76th Street at Emerson Avenue.
I
The four-way stop signs at 76th Street and Emerson Avenue were unwarranted at the time
they worn MUM. UMUU MM8d W signs may introduce rear-end and right-angle
accidents.
8?(?gl?n?u?191?
?
t
PRASE 11
_ i Id . ' O
°
'
t t
z
% WEST 17 112 S"I`B.nT
`T8
CITY OF RICHFIELD, MINNESOTA
M Council Letter No. 83
Agenda March 27, 1995
Issue Statement:
Consideration of removal of stop signs at 76th Street and Emerson Avenue.
Background:
As part of the City's plan to reconstruct 77th Street, 76th Street was changed from minor
arterial to a collector street. Over time, traffic on 76th Street will decline as people
become aware of the higher level of service provided by 77th Street.
The completion of the first phase of the 77th Street Project has prompted City Engineering
staff to recommend the removal of four-way stop signs on 76th Street at Emerson Avenue.
According to the City's Stop Sign Policy, the City Council must approve the removal of
stop signs on City streets.
The four-way stop signs at 76th Street and Emerson Avenue were unwarranted at the time
they were installed. Unwarranted stop signs may introduce rear-end and right-angle
accidents.
Unwarranted stop signs are frequently violated as motorists perform a rolling stop instead
of a complete stop. Before motorists on Emerson Avenue proceed to enter the
is intersection, many will wait until vehicles on 76th Street make a complete stop.
There is another stop sign only 300 feet to the west of Emerson Avenue. The proximity of
stop signs imposes delay for 76th Street traffic and'has led to numerous complaints from
motorists.
According to the City's Stop Sign Policy, two-way stop signs will control traffic on a local
street that intersects a collector or minor arterial street. In this case, two-way stop signs
will remain to control traffic on Emerson Avenue.
The public was alerted via the 77th Street Newsletter that the four-way stop signs at 76th
Street and Emerson Avenue were proposed for removal. In response to the notice, seven
people have called to indicate their support for removal and two indicated opposition.
One resident indicated the possibility that vehicles desiring to make a left-turn onto
Emerson Avenue could back up onto 77th Street. The volume of traffic on 76th Street is
not high enough to prevent motorists from making a left turn onto Emerson Avenue.
Carol J. Lean, President of Berea Lutheran Church, sent the attached letter opposing
removal of the stop signs. She claims that people cross 76th Street to reach the church.
However, the times of church services are limited and usually occur during off-peak
periods for traffic.
• The Richfield Ad Hoc Traffic Committee reviewed the information above and unanimously
recommended removal of the four-way stop signs on 76th Street at Emerson Avenue.
Recommended Motion:
Remove four-way stop signs on 76th Street at Emerson Avenue while leaving two-way
stop signs to control traffic on Emerson Avenue.
Basis of Recommendation:
1. 77th Street now serves the minor arterial function previously performed by 76th Street.
2. 76th Street east of 1-35W has been downgraded to collector street.
3. The four-way stop signs at 76th Street and Emerson Avenue were unwarranted at the
time they were installed. Unwarranted stop signs may introduce rear-end and right-
angle accidents.
4. Occasionally, vehicles operating in the left lane of a four-lane road cannot see the stop
signs because large trucks and vans traveling in the right lane obstruct their view.
5. Unwarranted stop signs are frequently violated as motorists perform a rolling stop
instead of a complete stop. Before motorists on Emerson Avenue proceed to enter the
intersection, they are forced to wait until vehicles on 76th Street make a complete stop.
6. There is another stop sign only 300 feet to the west of Emerson Avenue. The proximity
of stop signs imposes needless delay for 76th Street traffic and has led to numerous
complaints from motorists.
7. According to the City's Stop Sign Policy, two-way stop signs will control traffic on a
local street that intersects a collector or minor arterial street. In this case, two-way stop
signs should remain to control traffic on Emerson Avenue.
Alternative Recommendation:
Do not remove the four-way stop signs. City staff believes that unwarranted stop signs
introduce accidents. Also, 77th Street will continue to serve as the major route for east-
west traffic reducing the importance of 76th Street to a neighborhood collector.
Discussion/Decision Mode:
There is no set date for a decision to be made so the Council may choose to delay its
decision.
Respect My submitted,
Jame . Prosser
City ager
JDP:ds
• CITY OF RICHFIELD, MINNESOTA
Council Letter No. 82
Agenda March 27, 1995
Issue Statement:
Council consideration of an application for Arby's, 7744 Fifth Avenue, to install a
directional sign in the 77th Street corridor.
Background:
The Council, by Ordinance #416.07, Subd. 2, paragraph (2), requires that all offsite
directional signs in the 77th Street corridor be approved by the Council.
The ordinance requires that the application be presented to the Building Official and the
Building Official shall involve the planning and transportation divisions. Under the
ordinance there are 17 requirements that need to be met.
Recommended Motion:
Approve the permit to install an offsite directional sign at 77th Street and Fifth Avenue
South for Arby's, 7744 Fifth Avenue.
Basis of Recommendation:
1. Staff has reviewed the application and it appears to be in compliance with the
ordinance ([416.07, Subd. 2, paragraph g [2] [i - xvii]).
Alternative Recommendation:
1. The Council could deny the permit if, after their review, they do not determine it
complies with the ordinance intent.
2. The Council may wish to have additional information concerning this application
prior to approval.
Discussion/Decision Mode:
Approve staff's recommendation that a permit be issued to SignCrafters, 7775 Main
Street, Fridley, MN, for the installation of an offsite directional sign for Arby's, 7744 Fifth
Avenue.
Respectfully submitted,
Jame . Prosser
City Manager
0 JDP:ds
i-1 01
M-/
Planning Department"
0
Building Official:
Approve Deny ?
Approve Deny ?
Pt?
Date
JOBSITE: - -7-7' A IZS , BUSINESS NAME R By
SIGN INSTALLER N r, Ka F7 Ep- PHONE: S7 / Z 9
INSTALLER'S ADDRESS:
City Zip
DESCRIPTION OF WORK: L
Am
WALL ? GROUND PEDESTAL ? AWNING ? -- SG. FACED 1? DB. FACED
COLORS: [ L4 c SIZE: L ?' N x Z y
COPY: 1-- 060 ILLUMINATED: YES ? N0? ELEC. CONTRACTOR:
NOTE: IF ILLUMINATED - ELECTRICAL CONTRACTOR MUST OBTAIN PERMIT BEFORE STARTING WORK.
? TEMPORARY PROMOTION DATES OF PROMOTION:
(Must not exceed seven M calendar days)
TYPE: BALLOON ? PENNANTS ? BANNER ?
Sign copy must relate solely to the business, institution or activity conducted on the premises. Sign structure
must not restrict any sight distance under, around, or over for safe access by persons destined for or passing the
subject premises. ?
HIS AGFR SIGNATURE:
Date• /--- j-1 -- Zs_ Fee:
•
PORTLAND AVE
H
ti
PROPOSED FUTURE MEDIAN
•
STREET ID SIGN
18'
FROM
CURB
ARBYS
5 TH
8' FROM CURB
PROPOSED
18'X12"D/F
DIRECTIONAL
2 NI
4 TH
0
a
0
cr.
W
v
W
N
ARBY'S DIRECTIONAL SIGN - CITY OF RICHFIELD
2
I 24"
4" RADIUS I
CORNERS -
4" COPY
WHITE
6" LOGO t. 18"
WHITE
3/4"
^ HIGHWAY BLUE
BACKGROUND i
WHITE a ? SCOTCHLITE 280-75 r
BORDER
84"
STANDARD
GALVINIZED
POLE 2.5; DIAM.
D/F NON ILLUMINATED /DIRECTIONAL SIGNS
STANDARD E.F. ANDERSON .18'X 24" METAL PANEL RADIUS CORNERS
QTY-3@
V : i u
Approved 6 y Date
Richfield City Code 416.07, Subd. 2(f)(2)(yii1)7/n_
(Rev. 1993) T/7
(viii)if located on the parcel, the sign area does not exceed
200 square feet;
(ix) the proprietor requesting the sign has submitted an
application on forms provided for that purpose and has
paid the fee provided in Appendix D of this code; and
(x) the location, design and construction of the sign will
not be detrimental to the general public health, safety
or welfare. (Amended, Bill No. 1991-11)
(g) 77th Street Corridor. The following special provisions shall apply
to properties located in the 77th Street Corridor, defined as that
area bounded on the north by 77th Street, on the east by Cedar
Avenue/T.H. 77, on the west by I-35W, and on the south by a line
drawn parallel to and 150 feet southerly of the southerly right of
way of 77th Street.
(1) Any sign otherwise permitted under this section 416 is
permitted in the 77th Street Corridor, except as expressly
modified in this paragraph (g).
(2) Business directional signs. In addition to the signs
permitted under the preceding provisions of this subsection
416.07, off-site directional signs may be placed on properties
that immediately abut 77th Street, subject to the requirements
of this clause (g)(1). 'A business directional sign requires
a permit issued by the council. The application for such
permit shall be made to the building official. Upon receiving
an application, the building official shall involve the
planning and transportation divisions in a review of the
application. No such permit shall be issued without first
obtaining the approval of the council. The council shall not
approve the permit unless it determines that all of the
following conditions are or would be met.
(i) The sign must direct traffic to a business located on
property abutting I-494, but which does not abut on 77th
Street, 77-1/2 Street, I-35W, Lyndale Avenue, Nicollet
Avenue, Portland Avenue, 12th Avenue or Cedar Avenue.
(ii) The permit application must be made by the business
served by the sign. If the sign is to be located on
private property, the owner of the property must consent
to the application.
(iii) The sign must be placed at least 14 feet south of the
south curb line of the 77th Street roadway; and at least
six feet from any other public roadway, as measured from
the back of the curb. Notwithstanding any other
provision of this section 416 to the contrary, a
business directional sign may be located within the
unused right of way of a city street.
(iv) The sign location must not create a traffic hazard.
q jjjj 5-
Richfield City Code
416.07, Subd. 2(g)(2)(v)
(Rev. 1993)
(v) The business served by the sign may not have more than
one sign face addressing each direction of 77th Street
anywhere in the 77th Street Corridor. The sign may be
double-faced, or upon a showing of need, two separate
single-faced signs may be utilized to address each
direction of 77th Street. Sign faces shall be
positioned at approximately right angles to the 77th
Street roadway.
(vi) The business owner served by the sign must demonstrate
that he or she has contacted other eligible businesses
in the vicinity to determine whether they are interested
in going together on one sign.
(vii) In no instance may more than three businesses be
represented on one sign face. Such signage shall comply
with the following size requirements:
a) one business - 24 inches wide by 18 inches high
b) two businesses - 24 inches wide by 24 inches high
c) three businesses - 24 inches wide by 30 inches high
(viii)The business owner(s) being served by such signage are
responsible for the purchase and installation of the
sign.
(ix) The sign must contain the name of the business (or
businesses) and an arrow indicating which direction to
turn. In special circumstances it may be necessary to
use text in lieu of an arrow to indicate the appropriate
direction (i.e., next left). In any case, the use of
text shall be kept to a minimum.
(x) Signs may not contain advertising messages. The sign
may contain a color logo not to exceed 36 square inches
for-each business. In the case of multiple businesses
on one sign, logo placement shall be approved by staff.
(xi) The sign shall be mounted at a height of seven feet, as
measured from the bottom of the sign to the ground level
at the top of the abutting street curb.
(xii) The sign shall have a medium blue background. All
lettering and arrows shall be white. All lettering
shall be upper-case helvetica style, four inches in
height.
(xiii) The corners of the sign face shall be rounded. The sign
face shall have a white border just inside the edge.
Such border shall be three-quarters of an inch in width.
The corners of the sign border shall be rounded to fit
the sign face.
(xiv) The sign face shall be metal or other material as
approved by the city.
14
Richfield City Code
416.07, Subd. 2(g)(2)(xv)
(Rev. 1993 )??
(xv) The sign shall be mounted on a single iron post of
sufficient gauge to safely secure the sign face. The
business (or businesses) served by such signage shall be
responsible for contacting the utility companies before
installing the post.
(xvi) The business (or businesses) being served by off-site
directional signage shall keep such signage in proper
position, clean, and legible at all times. Damaged
signs shall be replaced by the business within 20 days
of written notice to repair such damaged sign by the
City. Failure to repair damaged signs within the 20
days will result in revocation of the permit and removal
of the sign by the city.
(xvii)In instances where the 77th Street off-site signage does
not lead traffic directly to the business via the
north/south avenues, the business may install one off-
site directional sign near the end of the avenue, as
approved by staff. This sign shall be installed and
designed similar to the 77th Street off-site sign,
however, the sign face shall be no more than six inches
in height by 24 inches in length. In unique
circumstances (i.e., business with.unusually long name)
the Council may approve a sign face that is more than 24
Inches in length.
(3) Ground monument signs. A ground monument sign which is
otherwise permitted under this subsection 416.07 must conform
to the following requirements. The sign may not exceed ten
feet in height or 60 square feet in area, and must be located
within a landscaped area at least equivalent to the sign's
area. The sign may be located outside of a landscaped area if
such a sign meets the following design criteria:
(i) it is located on abase of stone, or brick that is at
least three feet in height and 150% of the width of the
sign face.
(ii) the stone or brick base contains a planter which
occupies at least 100% of the total surface area
parallel to the ground plane of the base and is planted
with annual or perennial flowers.
Ground signs may be illuminated so long as light and glare
from such signs is not visible from residential property north
of 77th Street.
(4) Pedestal signs. Notwithstanding any other provision of this
subsection 416.07, pedestal signs are permitted within the
77th Street Corridor only if all of the following conditions
are met:
(i) The pedestal sign is located on property fronting on
Lyndale, Portland or Nicollet Avenues or on a corner lot
with primary entrance on 77th Street and secondary
street wall facing Lynda.le, Portland or Nicollet
Avenues;
CITY OF RICHFIELD, MINNESOTA
Council Letter No. 81
Agenda March 27, 1995
Issue Statement:
Consideration of a resolution approving a housing plan and the issuance of tax exempt
revenue bonds to purchase and renovate the Century Court apartments.
Background:
The City Council gave preliminary approval to the issuance of tax exempt bonds on
December 29, 1994 and authorized application for the allocation of bonding authority.
This action was taken at the request of Dominium Management Services, Inc.
(Dominium). The State subsequently awarded $19,679,000 in bonding authority to
provide for the purchase and renovation of Century Court apartments in Richfield.
When preliminary approval was granted by the City Council it was given subject to
review of the financial and rehabilitation packages. Discussions have been held
between staff and Dominium representatives. A public hearing was held on March 13,
1995 at a joint meeting of the HRA and City Council.
Recommended Motion:
Approve the attached resolution which approves the housing plan and sale of bonds in
it the amount of $19,679,000 to purchase and renovate Century Court apartments.
Basis of Recommendation:
1. The City Council approved the preliminary resolution on December 29, 1994.
2. This type of tax exempt revenue bond financing does not become a debt of the
City nor is the City responsible in any way for the payment of the bonds. Applicant
will receive dollar benefit from the tax exempt issuance through the City in an
amount approximating $3.5 to $4.0 million.
3. All parties recognize that some degree of renovation will be required for these
apartment buildings. Staff has had an evaluation made of the buildings by an
outside consultant as well as by relevant staff. Stuart Shelard estimated the rehab
requirements at $6.8 million. Dominium has stated that this same level of work
could be completed for $4.7 million.
4. Review of Issues:
A. Amount of rehabilitation
• Dominium has agreed to $3.5 to rehab the apartment properties.
• Staff estimates of dollar benefits accruing from the issuance of tax
exempt bonds through the City range from $3.5 to 4.0 million.
B. Timing of rehabilitation
• Dominium has proposed the initial two year expenditure of $2,284,000
with the remainder from 50% of the cash flow. (If a tax credit
syndication is established, the entire $3.5 million would be expended in
the initial period.) See Dominium letter of March 22, 1995 and
Rehabilitation Plan.
• Publicorp estimates that a 50% of cash flow payment system will
require five to six years to establish the full dollar amount. See letter
dated March 21, 1995 from Publicorp.
C. Assurance of payment
• Doninium would agree to payment of gross revenue to a Trustee who
would allocate funds including the 50% for rehab.
• An Escrow Account will provide an agreed upon allocation of funds
provided there is a positive cash flow.
D. Tax credits
• Dominium indicates that the current structure of the partnership would
not allow the utilization of tax credits. If such partnership was
restructured and tax credits became available, the percentage of low or
moderate income units qualifying for tax credits would have to be
negotiated with the City. Some 40% would be required by the tax
exempt bond issuance. Dominium has submitted a survey indicating
60% of the current residents qualify.
• A more finite survey of tenants with the implications therefrom would
have to be accomplished at the time of request.
E. Assurance of issuance and sale of bonds.
• Dominium has $200,000 on deposit to assure the issuance of the
bonds by April 7,1995. The process would entail issuance and
"parking" of the bonds. To assure the City that the bonds would be
"unparked" and sold, Dominum would deposit the $200,000 with the
City less the amount of out-of-pocket costs of approximately $75,000.
• The City wishes to avoid any adverse consequence which may result if
bonds are not "unparked".
F. Issuer's fee and replacement. revenues
• A change in property tax classification will result in lowering the
property tax to be paid. Dominium would agree to replace lost tax
revenues to the City and school district. An issuer's fee of 1/8 of 1%
would be folded into the revenue replacement amount.
• Century Courts is the largest tax payer in the City and a change in
classification has major consequences. Replacement of this revenue
to the City and the school district for its excess levy is necessary. It is
also appropriate to establish an issuer's fee in this type of situation.
G. Maintenance Reserve
• A maintenance reserve will be established for repair and replacements.
• The maintenance reserve is to be over and above the amounts noted in
the rehabilitation plan
5. The basic underlying documents related to the transfer of property have been
reviewed by the City Attorney's office.
6. A Management Plan has been submitted and attached.
7. Additional documents on the bond issuance are attached including:
A. Indenture agreement
1 B. Loan agreement
C. Regulatory agreement
D. Housing plan
E. Proposed resolution
8. Unless the underlying documents are restructured, the current owners (Wolfenson
and Ratner) would become the limited half interest partners and Dominium would
become the general partner and half interest owner.
9. Dominium has deposited $25,000 with the City to cover the excess cost of review
of.the proposal.
10. The City Council must take action on the proposal and the HRA is available for
discussion and input as appropriate.
Alternative Recommendation:
1. Reject the proposal unless there is an agreement to fund the entire $3.5 million for
rehab of the units within the initial two year period. The savings of $3.5 to $4.0
million resulting from the issuance of tax exempt bonds through the City should be
reinvested in the project promptly without contingencies.
2. Reject the proposal unless all rehab work outlined by Stuart Shelard in a report to
the City be accomplished in an amount estimated by Stuart Shelard at $6,803,000
and restated by Dominium with their applicable costs at $4,720,314.
Discussion/Decision Mode:
Final action must be taken at the March 27, 1995 meeting by the City Council in order
to sell the bonds by the April deadline or the right to issue is lost.
Respectf submitted,
James rosser
City Ma ger
JDP:cak
Nc+
i
•
CITY OF RICHFIELD, NHNNESOTA
RESOLUTION NO.
ADOPTING A HOUSING PROGRAM FOR AND AUTHORIZING THE
ISSUANCE, SALE AND DELIVERY OF MULTIFAMILY HOUSING
REVENUE BONDS (CENTURY COURT APARTMENTS PROJECT) SERIES
1995, IN AN AMOUNT NOT TO EXCEED $21,000,000; APPROVING THE
FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A
LOAN AGREEMENT .AND INDENTURE OF TRUST AND OTHER
DOCUMENTS; APPROVING THE FORM OF AND AUTHORIZING THE
EXECUTION AND DELIVERY OF SAID BONDS
WHEREAS, the City of Richfield, Minnesota (the "Issuer") is a political
subdivision and municipal corporation duly organized and existing under the
Constitution and laws of the State of Minnesota; and
WHEREAS, pursuant to the Constitution and laws of the State of Minnesota,
particularly Minnesota Statutes, Chapter 462C, as amended (the "Act"), the Issuer
is authorized to carry out the public purposes described in the Act and contemplated
thereby in the financing of housing within its boundaries, by issuing revenue bonds
to defray, in whole or in part, the cost of acquisition and rehabilitation of a rental
housing development, and by entering. into any agreements made in connection
therewith and by pledging any such agreements as security for the payment of the
principal of and interest on any such revenue bonds; and
• WHEREAS, the Issuer, on March 13, 1995 and on the date hereof, held public
hearings regarding a Program for a Multifamily Housing Development, in the form on
file with the City Clerk (the "Program") pursuant to and in conformance with the Act
for which notice was duly published as required by the Act and Section 147(f) of the
Internal Revenue Code of 1986, as amended; and
WHEREAS, pursuant to the Act, the Issuer proposes to undertake the Program
to finance the acquisition and rehabilitation of a 1,140-unit qualified residential
rental project known as Century Court Apartments (the, "Project") located at 7431-
7521 Lyndale Avenue, 6301=6325 -Lyndale Avenue, and 7600-7720 Penn Avenue in the
City to be owned by Dominium, Inc. a corporation formed under the laws of the State
of Minnesota (the "Owner") ; and
WHEREAS, the Issuer is authorized to issue and sell the "City of Richfield,
Minnesota Multifamily Housing Revenue Bonds (Century Court Apartments Project)
Series 1995" in the aggregate principal amount not to exceed $21,000,000; and said
Bonds and the interest on. said Bonds shall be payable solely from the revenue
pledged therefor and the Bonds shall not constitute a debt of the Issuer within the
meaning of any constitutional or statutory limitation nor give rise to a pecuniary
liability of the Issuer or a charge against its general credit or assets and shall not
constitute a charge, lien, or encumbrance, legal or equitable, upon any property of
the Issuer other than the Issuer's interest in said Project; and
WHEREAS, the Issuer has received an allocation of authority to issue bonds
subject to a federal volume limitation for the Project from the Minnesota Department
• of Finance, in accordance with Minnesota Statutes, Chapter 474A; and
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WHEREAS, forms of the following documents (including the exhibits referred
to therein) have been submitted to the Issuer: •
a. an Indenture of Trust, dated as of April 1, 1995, to be made and
entered into among the Issuer and First Trust National Association, as trustee
(the "Trustee") providing for the issuance of the Bonds, prescribing the
form thereof, pledging the trust estate described therein for the security of
the Bonds, and setting forth proposed recitals, covenants and agreements by
the parties with respect thereto;
b . a Loan Agreement, dated as of April 1, 1995, to be executed by
the Issuer and the Owner, providing for the loan of proceeds of the. Bonds
from the Issuer to the Owner;
C. a Regulatory Agreement, dated as of April 1, 1995, to be
executed by the Issuer, Trustee and the Owner, setting forth certain
covenants of the Owner relating to the compliance of the Project with federal
tax law restrictions relating to the Bonds;
d. a Bond Purchase Agreement (the "Bond Purchase Agreement"),
by and among the Issuer, the Owner and Piper Jaffray Inc. (the
"Underwriter") providing for the purchase of the Bonds by the Underwriter;
e. a Limited Offering Memorandum (the "Limited Offering
Memorandum"). - _.
The agreements described and referred to in paragraphs a through d alcove,
shall hereinafter sometimes be referred to collectively as the "Agreements"; •
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF RICHFIELD, MINNESOTA THAT:
Section 1. The Issuer acknowledges, finds, determines, and declares thatthe
preservation of the quality of life in the City is dependent upon the maintenance,
provision, and preservation of an adequate housing stock, which is affordable to
persons and families of low or moderate income, that accomplishing this is a public
purpose, and that many would-be providers of housing units for low and moderate
income persons in the City are either unable to afford mortgage credit at present
market rates of interest or are unable to obtain mortgage credit. The Issuer also
hereby finds, determines and declares that the Project has been designed to be
affordable by persons and families with adjusted gross incomes not in excess of 110
percent of the median family income as most recently estimated by the United States
Department of Housing and Urban Development for Hennepin County, and that,
based solely on representations of the Owner, at least 40 percent of the dwelling
units in the Project will be held for occupancy by families and individuals with
adjusted gross incomes not in excess of 60 percent of the median family income.
Section 2. The Issuer further finds, determines, and declares that the
purpose of the Program is to issue the Bonds, the proceeds of which will be used to
finance the acquisition and rehabilitation of the Project for occupancy primarily by
persons of low and moderate income, and the Issuer hereby approves and adopts the
Program.
•
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Section 3. For the purpose' of financing the Program there is hereby
• authorized the issuance of the Bonds: <The Bonds shall bear interest at such rates,
shall be in such denomination, shall be numbered, shall be dated, shall mature, shall
be subject to redemption prior to maturity, shall be in such form, and shall have
such other details and provisions as are prescribed by the Indenture.
Section .4..The Bonds shall be special obligations of the Issuer payable solely
from the revenues of the Program, in the manner provided in the Indenture. The
Bonds do not constitute an indebtedness, liability, general or moral obligation
(except to the extent of the trust estate pledged under the Indenture) or a pledge
of the faith and credit or any taxing power of the Issuer, the State of Minnesota, or
any political subdivision thereof. The Issuer hereby authorizes and directs the
Mayor of the Issuer (the "Mayor") and the City Manager of the Issuer (the
"Manager") to execute under the corporate seal of the Issuer, the Agreements, and
to deliver the Agreements to said Trustee, and hereby authorizes and directs the
execution of the Bonds in accordance with the Indenture, and hereby provides that
the Indenture shall provide the terms and conditions, covenants, rights,
obligations, duties, and agreements of the bondholders, the Issuer, and the Trustee
as set forth therein.
All of the provisions of the Agreements, when executed as authorized herein,
shall be deemed to be a part of this Resolution as fully and to the same extent as if
incorporated verbatim herein and shall be in full force and effect from the date of
execution and delivery thereof. The Agreements shall be substantially in the form
before the Issuer on the date hereof, and is hereby approved, with such changes as
shall be approved by the Mayor pursuant to this section, and with such necessary
• and appropriate variations, omissions, and insertions as are not materially
inconsistent with such form and as the Mayoic, in his discretion, shall determine;
provided that the execution thereof by the Mayor shall be conclusive evidence of
such determination.
Section 5. All covenants, stipulations, obligations, representations, and
agreements of the Issuer contained in this Resolution or contained in the Agreements
or other documents referred to therein shall be deemed to be the covenants,
stipulations, obligations, representations, and agreements of the Issuer to the full
extent authorized or permitted by law, and all such covenants, stipulations,
obligations, representations, and agreements shall be binding upon the Issuer.
Except as otherwise provided in this Resolution, all rights, powers, and privileges
conferred, and duties and liabilities imposed, upon the Issuer by the provisions of
this Resolution or of the Agreements or other documents referred to therein shall be
exercised or performed by the Issuer, or by such officers, board, body, or agency
as may be required or authorized by law to exercise such powers and to perform
such duties. No covenant, stipulation, obligation, representation, or agreement
herein contained or contained in the Indenture or other documents referred to above
shall be deemed to be a covenant, stipulation, obligation, representation, or
agreement of any officer, . agent, or employee of the Issuer in that person's
individual capacity, and neither the Council of the Issuer nor any officer or
employee executing the Bonds shall be liable personally on the Bonds or be subject
to any personal liability or accountability by reason of the issuance thereof.
Section 6. Except as herein otherwise expressly provided, nothing in this
Resolution or in the Agreements, expressed or implied, is intended or shall be
• construed to confer upon any person, firm, or corporation other than the Issuer,
the holders of the Bonds, and the Trustee any right, remedy, or claim, legal or
BLP85892
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equitable, under and by reason of this Resolution or any provision hereof or of the
Agreements or any provision thereof; this Resolution, the Agreements and all of .
their provisions being intended to be and being for the sole and exclusive benefit of
the Issuer and the holders from time to time of the Bonds issued under the
provisions of this Resolution and the Agreements, and the Owner to the extent
expressly provided in the Agreements.
Section 7. In case any one or more of the provisions of this Resolution or of
the Agreements or of the Bonds 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 Agreements or of the Bonds, but this Resolution, the
Agreements; and the Bonds shall be construed as if such illegal or invalid provision
had not been. contained therein. The terms and conditions set forth in the
Agreements, the pledge of revenues derived from the Program referred to in the
Agreements, the pledge of collateral derived from the Program referred to in the
Agreements, the creation of the funds provided for in the Indenture, the provisions
relating to the application of the proceeds derived from the sale of the Bonds
pursuant to and under the Indenture, and the application of said revenues,
collateral, and other monies are all commitments, obligations, and agreements on the
part of the Issuer contained in the Agreements, and the invalidity of the Agreements
shall not affect the commitments, obligations, and agreements on the part of the
Issuer to create such funds and to apply said revenues, other monies, and proceeds
of the Bonds for the. purposes, in the manner, and according to the terms and
conditions fixed in the Indenture, it being the intention hereof that<' such
commitments on the part of the Issuer are as binding as if contained in this
Resolution separate and apart from the Indenture.
Section 8. All acts, conditions, and things required by the laws of the State
of Minnesota, relating to the adoption of this Resolution, to the issuance of the
Bonds, and to the execution of the Agreements and the other documents referred to
therein to happen, exist, and be performed precedent to and in the enactment of this
Resolution, and precedent to the issuance of the Bonds, and precedent to the
execution of the Agreements and the other documents referred to above have
happened, exist, and have been performed as so required by law.
Section 9. The City Council of the Issuer, officers of the Issuer, and
attorneys and other agents or employees of the Issuer are hereby authorized to do
all acts and things required of them by or in connection with this Resolution and the
Agreements and the other documents referred to therein for the full, punctual, and
complete performance of all the terms, covenants, and agreements contained in the
Bonds, the Agreements and the other documents referred to above, and this
Resolution.
Section 10. The Issuer is not participating in the preparation of the Limited
Offering Memorandum and has made and will make no independent investigation with
respect to the information to be contained therein, including the Appendices thereto,
and the Issuer assumes no responsibility for the sufficiency, accuracy or
completeness of such information. Subject to the foregoing, the Issuer hereby
consents to the distribution and the use by Piper Jaffray Incorporated in connection
with the issuance of the Bonds of the Limited Offering Memorandum in substantially
the form on file with Issuer. The Limited Offering Memorandum is the sole material
consented to by the Issuer for use in connection with the issuance of the Bonds.
•
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Section 11. The Mayor and the Manager are hereby designated and authorized
• to execute the Officers' Certificate; as defined in the Indenture, and to take such
other administrative action as is permitted or required by the Agreements.
Section 12. The Mayor and the Manager of the Issuer are authorized and
directed to execute and deliver any and all certificates, agreements or other
documents which are required by the Agreements, or any other certificates or
documents which are deemed necessary by bond counsel to evidence the validity or
enforceability of the Bonds, the Agreements or the other documents referred to in
this Resolution, or to evidence compliance with Section 142(d) of the Internal
Revenue Code of 1986, as amended; and all such agreements or representations when
made shall be deemed to be agreements or representations, as the case may be, of
the Issuer.
Section 13. If for any reason the Mayor of the Issuer is unable to execute and
deliver those documents referred to in this Resolution, any other member of the
Council of the Issuer may execute and deliver such documents with the same force
and effect as if such documents were executed by the Mayor. If for any reason the
Manager of the Issuer is unable to execute and deliver the documents referred to in
this Resolution, such documents may be executed and delivered by any other member
of the Council with the same force and effect as if such documents were executed and
delivered by the Manager.
Section 14. This Resolution shall be in full force and effect from and after its
passage.
• PASSED AND APPROVED this 27th day of March, 1995.
THE CITY OF RICHFIELD,
MINNESOTA
Mayor
ATTEST:
Manager
•
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0
•
HOUSING PROGRAM FOR A
MULTIFAMILY HOUSING DEVELOPMENT
Pursuant to Minnesota Statutes, Chapter 462C (the "Act"), the City of
Richfield (the "City") is authorized to develop and administer programs to finance
the acquisition and rehabilitation of multifamily housing developments under the
circumstances and within the limitations set forth in the Act. Minnesota Statutes,
Section 462C.07 provides that such programs for multifamily housing developments
may be financed by revenue bonds issued by the City.
The City has received a proposal that it approve a program providing for the
acquisition and rehabilitation of a 1,140-unit qualified residential rental project
known as Century Court Apartments (the "Project") located at 7431-7521 Lyndale
Avenue, 6301-6335 Lyndale Avenue, and 7600-7720 Penn Avenue in the City, by
Dominium, Inc. a Minnesota corporation, or a limited partnership to be formed in
which Dominium, Inc. will be a general partner (the "Developer"). The acquisition
and rehabilitation of the Project is to be funded through the issuance of up to
$21,000,000 in revenue bonds to be issued by the City (the "Bonds"). Following
acquisition and rehabilitation of the Project, the Developer will own and operate the
Project as a multifamily residential rental project. The Project will meet the minimum
rehabilitation requirements of Sections 147(d) and 42(e) (2) of the Internal Revenue
Code of 1986, as amended (the "Code") and will be occupied by individuals or
families whose incomes at the time of initial occupancy will meet the requirements of
Sections 142(d) and 42(g) of the Code. It is estimated that rents for the Housing
Units will range from approximately $395 per month to $490 per month.
• The City, in establishing this multifamily housing program (the "Program"),
has considered the information contained in the City's 462C Housing Plan (the
"Housing Plan"). The Project will be acquired and rehabilitated in accordance with
the requirements of Subdivisions 1 and 2 of Section 462C.05 of the Act.
Section A. Definitions. The following terms used in this Program shall have
the following meanings, respectively:
"Act" shall mean Minnesota Statutes, Section 462C.01, et seq., as
currently in effect and as the same may be from time to time amended.
"Bonds" :shall. mean the revenue bonds to be issued by the City to
.finance the Program.
"City" shall mean the City of Richfield, Minnesota.
"Developer" shall mean Dominium, Inc., a Minnesota corporation, or a
limited partnership to be formed in which Dominium, Inc.. will be a general
partner.
"Housing Plan" shall mean the City's 462C Housing Plan, adopted
pursuant to the Act, of which this Program is a part.
"Housing Unit" shall mean any one of the apartment units, each located
in the Project, occupied by one person or family, and containing complete
living facilities.
"Land" shall mean the real property upon which the Project is situated.
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RC125-94
"Program" shall -mean this program for the financing of the Project
pursuant to the Act. 0
"Project" shall mean the residential rental housing development
consisting of approximately 1,140 Housing Units, 1,138 one-bedroom and 2
two-bedroom units to be acquired and rehabilitated by the Developer.
Section B. Program For Financing the Project. It is proposed that the City
establish this Program to provide financing for acquisition and rehabilitation of the
Project at a cost and upon such other terms and conditions as are set forth herein
and as maybe agreed upon in writing between the City, the initial purchaser of the
Bonds and the Developer. The City expects to issue.the Bonds prior to April 9,
1995, but only when and if the terms of the Bonds have been agreed upon by the
City, the Developer and the initial purchaser of the Bonds. The proceeds of the
Bonds will be loaned to the Developer to finance the acquisition and rehabilitation of
the Project, to fund required reserves and to pay the costs of issuing the Bonds.
It is expected that a trustee will be appointed by the City to monitor the
rehabilitation of the Project and the payment of principal and interest on the Bonds.
. It is anticipated that the Bonds shall have a maturity of approximately thirty
(30) years and will bear interest at a rate priced to the market at the time of
issuance.
The City will hire no additional staff for the administration of the Program.
Insofar as the City will be contracting with underwriters, legal counsel, bond
counsel, the trustee, and others, all of whom will be reimbursed from bond proceeds
and revenues generated by the Project, no administrative costs will be paid from the
City's budget with respect to this Program. The Bonds will not be general obligation
bonds of the City, but are to be paid only from properties pledged to the payment
thereof, which may include additional security such as additional collateral;
insurance or a letter of credit.
Section C. Local Contributions To The Program. The City will participate in
the Project financing as necessary to comply with the requirements of Chapter 474A,
relating to the allocation of tax-exempt bonding authority to the Bonds.
Section D. Standards and Requirements Relating to the Financing of the
Project Pursuant to the Program. The following standards and requirements shall
apply with respect to the operation of the Project by the Developer pursuant to this
Program:
(1) Substantially all of the proceeds of the sale of the Bonds will be
applied to the acquisition and rehabilitation of the Project and to the funding
of appropriate reserves. The proceeds will be made available to the Developer
pursuant to the terms of the Bond offering, which will include certain
covenants to be made by the Developer to the City regarding the use of
proceeds and the character and use of the Project.
(2) The Developer, and any subsequent owner of the Project, will not
arbitrarily reject an application from a proposed tenant because of race, color,
creed, religion, national origin, sex, marital status, or status with regard to
public assistance or disability.
(3) At least forty percent (40%) of the Housing Units will be held for
occupancy by families or individuals with gross income not in excess of sixty
percent (60%) of median family income, adjusted for family size, in order to
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comply with Federal tax law requirements for the use of tax-exempt financing.
This set aside will also satisfy the low-income occupancy requirements of
Section 462C.05, Subdivision 2 of the Act.
(4) Pursuant to Section 462C.05, Subdivision 2 of the Act, the
Project is designed to be affordable by persons and families with Adjusted
Gross Income not in excess of the greater of (a) 110 percent of the median
family income as estimated by the United States Department of Housing and
Urban Development for Hennepin County, or (b) 100 percent of the income
limits established by the Minnesota Housing Finance Agency for the City and
by other persons and families to the extent determined to be necessary by the
City in furtherance of the policy of economic integration.
Subsection E. Evidence of Compliance. The City may require from the
Developer at or before the issuance of the Bonds, evidence satisfactory to the City
of the ability and intention of the Developer to complete the rehabilitation of the
Project, and evidence satisfactory to the City of compliance with the standards and
requirements for the financing established by the City; and in connection therewith,
the City or its representatives may inspect the relevant books and records of the
Developer in order to confirm such ability, intention and compliance. In addition,
the City may periodically require certification from either the Developer or such
other person deemed necessary concerning compliance with various aspects of this
Program.
Subsection F. Issuance of Bonds. To finance the Program authorized by this
Section the City may by resolution authorize, issue and sell its revenue bonds in an
aggregate principal amount of approximately $21, 000, 000. The Bonds shall be issued
pursuant to Section 462C.07, Subdivision 1 of the Act, and shall be payable
primarily from the revenues of the Program authorized by this Section. The costs
of the Project are presently expected to be in excess of $21,000,000. Such excess
costs will be paid from funds of the Developer derived from other sources, including
proceeds of conventional taxable loans.
The costs of the Project may change between the date of preparation of this
program and the date of issuance of, the Bonds. The Bonds are expected to be
issued prior to April 9, 1995.
Subsection G . Severability. The provisions of this Program are severable and
if any of its provisions, sentences, clauses or paragraphs shall be held
unconstitutional, contrary to statute, exceeding the authority of the City or
otherwise illegal or inoperative by any court of competent jurisdiction, the decision
of such court shall not affect or impair any of the remaining provisions.
Subsection H. Amendment. The City shall not amend this Program, while
Bonds authorized hereby are outstanding, to the detriment of the holders of such
Bonds.
Subsection I. State Ceiling. $21, 000, 000 of the state ceiling. for private
activity bonds, pursuant to Section 146 of the Internal Revenue Code of 1986, as
amended, and Chapter 474A of Minnesota Statutes has been obtained with respect to
the Bonds.
•
BLP83546
RC125-94
3
•
•
•
DOMINIUM.
March 22, 1995
Martin Kirsch
Mayor
City of Richfield
6700 Portland Ave.
Richfield, MN 55423-2599
RE: Century Court Apartments
Dear Mayor Kirsch, and Mr. Prosser:
James D. Prosser
City Manager
City of Richfield
6700 Portland Ave.
Richfield, MN 55423-2599
As we discussed in our recent meeting with Byron Wallace, John Dean of Holmes & Graven, and
Mark Ruff of Ehlers & Publicorp, Richfield Housing Associates Limited Partnership (the
"Partnership") is willing to do the following based upon the issuance by the City of Richfield
("City") of tax exempt bonds for the Century Court Apartment project:
a. The Partnership will agree to spend at least $3,500,000.00 to rehabilitate the
apartment project. The Partnership will select the sequence of the expenditures
from a menu of items pre-approved by the City. The expenditures will be paid from
an "Escrow Account" which will be funded as set forth below.
b. $2,280,000.00 of the $3,500,000.00 will be paid to the Escrow Account upon the
closing of the bond transaction. The balance, $1,220,000.00, will be paid either
from the proceeds of a tax credit syndication or from 50% of the cash flow of the
apartment project. If no tax credit syndication is completed, the Partnership will
agree to Mark Ruff s suggestion that the project's gross revenues be paid to a
Trustee who will provide the necessary funds to pay all expenses and debt service
of the project. At the end of each three (3) month period, the Trustee will
•
Minneapolis - Milwaukee - Miami
3140 Harbor Lane, Suite 102 Minneapolis, MN 55447-5120 Phone 612/559-1711 Fax.612/559-1783
Development - Construction - Management
City of Richfield
March 22, 1995
Page Two
distribute 50% of the remaining funds to the Escrow Account and the remaining
50% to the Partnership for distribution to its partners.
The Escrow Account will be available to the Partnership to pay for expenditures
described in Paragraph La. above. If the project's revenues in any quarter are
insufficient to pay its expenses and debt service, the Partnership may obtain an
advance of such amounts from the Escrow Account. However, thereafter 100% of
the project's cash flow will be paid to the Escrow Account until the advance is
repaid.
d. The above described cash flow sharing arrangement and the collection of all gross
revenues by the Trustee will terminate when the Escrow Account has a balance of
$3,500,000.00.
2. Because State law requires that the bonds be sold by April 7, 1995, we contemplate that,
as an interim measure, the tax exempt bonds will be "parked" until the final financing for
the project has been arranged. A concern has been expressed about the consequences if
the bonds are not "unparked" resulting in a loss of the 1995 allocation of tax exempt
bonds. To provide an incentive to the Partnership to insure that the bonds are "unparked,"
the Partnership will agree to deposit with the City at the time the bonds are "parked" an
amount equal to $200,000.00 less the actual out-of-pocket expenses incurred in "parking"
the bonds. It is estimated that these costs will total approximately $75,000.00. If, by the
end of 1995, the bonds are not "unparked and the failure to "unpack" the bonds was
caused by the Partnership, this deposit will be forfeited to the City; otherwise, the deposit
will be returned to the Partnership.
The Partnership will enter into a Payment in Lieu of Taxes ("PILOT") Agreement
whereby the Partnership will pay the City 26% of the amount by which the project's real
estate taxes payable in 1996. and thereafter are less than the project's taxes payable in
1995, where the decrease is attributable to the project's Title II tax status. Such payments
under the PILOT Agreement will be operating expenses of the project, payable from the
project's cash flow.
4. The Partnership will agree to pay the City out of the project's cash flow a fee equal to 11
of 1% per annum of the principal amount of the tax exempt bonds outstanding from time
to time. Such fee will be a credit against the amount payable to the City under the PILOT
Agreement described in Paragraph 3 above.
E
City of Richfield
March 22, 1995
Page Three
This letter sets forth our commitment to proceed with financing and development of the project
upon the terms outlined above. It is understood and agreed that more detailed discussion of the
foregoing terms will be included in the bond documents to be entered into at the time the escrow
bonds are "unparked. Failure to include any of the foregoing terms in the bond documents in
connection with the permanent financing in a manner satisfactory to the City will be deemed to be
a failure to "unpark" which was caused by the Partnership, and the deposit referred to in
Paragraph 2 above will be forfeited to the City. By your signature on the acceptance line set forth
below, this becomes a binding agreement between Richfield Housing Associated Limited
Partnership and the City of Richfield.
Very truly yours,
David L. Brierton
0 The foregoing is accepted and agreed to this day of , 1995.
RICHFIELD HOUSING ASSOCIATES LIMITED PARTNERSHIP
By: Richfield Housing sociate , L. , a ota limited liability partnership
Its: General Partn r
i'
By: '
Its: a partner
CITY OF RICHFIELD
By:
Its: Mayor
By:
Its: City Manager
DB/kp
0
•
C7
CENTURY COURT - RICHFIELD
Rehabilitation Plan
The rehabilitation work at the Century Court -. Richfield Apartments will be
separated into three rehabilitation categories. The total rehabilitation budget
has been established at $3.5 million. The first $2,284,000 of rehabilitation
work will be funded through a capital improvement escrow. The remaining
$1,216,000 of rehabilitation work will be funded from 50% of operating cash
flows or pursuant to the agreement dated March 22, 1995.
Rehabilitation Category #1
The City of Richfield has requested the partnership immediately address the
areas listed below. The partnership has designated $749,000 of the escrow
funds to be used for items listed below. This rehabilitation work will be
completed over the first 24 months.
Parking Areas: All parking areas will be resurfaced with on
overlayment along. with. new stripping.
Estimated cost: $261,000
Windows: The windows, where needed, will be repaired and/or
replaced. Stone sills and windows will be recaulked. Window
panes will be replaced where needed.
Estimated cost: $300,000
•
JACENT-S0\D0C\REHB0321.D0C 3/23/95 1
Controlled Entry/Security Systems: All main building entries
will have a controlled access security system installed. Other
entries will be locked and be accessed by residents with keys.
Estimated cost: $138,000
Exterior Lighting: Additional exterior lighting will be installed
around the parking areas to improve tenant safety.
Estimated cost: $15,000
GFI Receptacles: GFI outlets will be installed in all kitchens
and baths.
Estimated cost: $35,000.
The following rehabilitation options will be funded from two separate sources
and are identified as Category #2 and Category #3.
Rehabilitation Category #2
The second rehabilitation category will be funded from the $1,535,000
remaining in the escrow account. The rehabilitation work funded from
Category #2 will be completed during the first 24 months. The list of
rehabilitation options to be performed under Category #2 is listed under
Rehabilitation Options.
•
JACENT-SODOMEHB0321.DOC 3/23/95 2
Rehabilitation Category #3
The last rehabilitation category represents $1,216,000 of work that will be
funded from cash flows or tax credit proceeds pursuant to the agreement
dated March 22, 1995. This rehabilitation work will begin once the funds in
the: rehabilitation escrow have been depleted. A list of rehabilitation options
for Category #3 funds are listed below.
Rehabilitation Options
Flat Roofs: Flat roofs at the Penn Avenue location will be
replaced as necessary.
Pitched Roofs: The pitched roofs at the Lyndale Avenue
locations are generally in good condition. Repairs to the pitched
roofs will be made as necessary.
Heating/Boilers: Boilers will be replaced with energy efficient
models Zone valves will be repaired and/or replaced as needed.
.: Hot Water Heaters: Hot water heaters will be replaced with
energy efficient models.
Interruptible Gas Service: A liquid propane interruptible gas
system will be installed at the site. The availability of
interruptible gas service will substantially reduce the project's
utility costs.
•
JACENT-S0\D0C\REHB032I.D0C 3/23/95 3
Exterior Painting/Caulking: Some masonry tuck pointing is
required to repair step cracking, which typically occurs on what
appears to be around the lintel at the garden level window units
and the openings for the window type air conditioners.
Garages: New detached garages will be constructed to provide
tenants the option of covered parking.
Common Areas: Common area walls will be repainted were
necessary and worn common area carpet will be replaced.
Landscaping: New shrubbery and flower beds will enhance the
project. The lawn irrigation system will be repaired
Counter Tops: Kitchen and bathroom counter tops will be
replaced as needed. I*
Appliances: Approximately 100% of the gas ranges, 50% of
the refrigerators, 100% of the range hoods, and 75% of the air
conditioners are original. Appliances will be replaced were
necessary. New appliances will include Frigidaire refrigerators,
stoves, range hoods, and air conditioning units.
CarpetNinyl: Worn or unsightly carpeting and vinyl will be
replaced where necessary. Units will also be repainted.
•
J:ICENT-SO\DOC\REHB032 LDOC 3/23/95 4
, Cr_ JPublicorp Inc.
950 Norwest Center (612) 339-8291
South Seventh Street FAX (612) 339-0854
Minneapolis, MN 55402.4100
March 21, 1995
T4: Jim Prosser, City of Richfield
FR: Mark Ruff
R.E: Review of Century Courts Pro forma
The current proposal by Dominium is to fund physical improvements of the Century Courts property out of
bond proceeds and 50% of the cash flow over time in an amount equal to $3,500,000 in present value dollars.
'Ihe up-front deposit will be 52.284 million and the payments over time will be 51.216 million.
Attached is a review of the Century Courts proposed pro forma after the new financing takes place. The
$1.216 million will be funded out of 50% of the cash flow for the period of time necessary to reach the $3.5
million in total value in the fund. Assuming that the tax-exempt bonds will hold a 7.75% interest rate, the
property is 95% occupied, and expenses remain at $2,900 per unit per year, Nve expect that the improvements
to be fully funded in either year 5 or year 6 (See line 29 on page 3 of the attachments), If cash flow is lower
than expected, the time necessary to fund the improvements will be lengthened.
We do believe that this structure adds a significant incentive for Dominium to operate the property in such
a manner that will fund the improvements as quickly as possible. In addition, the bond trustee will hold all
funds in escrow and will assure that the improvement fund will receive the necessary deposits.
Dominium has indicated that it will seek to increase the amount funded up-front from the current $2.284
million. This decision cannot be made until the terms of the permanent lender are finalized.
Please call with any questions or comments.
•
0 -
In i, swwiation with Ehlers and Associates, Inc.
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• DOMINIUM.
March 23,1995
James Prosser
City Manager
City of Richfield
6700 Portland Ave.
Richfield, MN 55423-2599
RE: Century Court Apartments
Dear Mr. Prosser:
Dominium shares the same vision for Century Court Apartments as the City
of Richfield. We are committed to a professional management strategy that
will ensure the property remains a good neighbor in the city for the next 30
years. Our operations and management procedures will aggressively maintain
Century Court Apartments as a quality place for Richfield residents to live.
Under our operating plan, we will not raise rents significantly from current
levels. We will not reposition this project in the market place. We are
committed to serving the needs of the existing tenant population.
In exchange for the City's assistance in providing the conduit for tax exempt
bond financing, we will pledge to make significant physical improvements to
the property that ordinarily would not be financially feasible. We further
pledge that Century . Court will be operated in accordance with the attached
Management Plan. Before we incorporate any changes to this Management
Plan we will solicit comments and suggestions from the City.
For your reference, we have attach a description of the qualifications and the
number of individuals who will have responsibility for this project's
management activities.
Minneapolis • Milwaukee • Miami
3140 Harbor Lane, Suite 102 Minneapolis, MN 55447-5120 Phone 612/559-1711 Fax 612/559-1783
Development • Construction • Management
James Prosser
March 23, 1995
Page Two
We are committed to implementing an aggressive tenant selection process.
Effective review of prospective tenants is critical in ensuring that the resident
profile is maintained at the highest possible standards. In addition to the
selection process identified in the Management Plan, I have attached a more
detailed Tenant Selection Plan for residents that may be subject to income
restrictions.
In our Management Plan, we agree to meet with representatives of the city at
least on a semi-annual basis to discuss issues of interest to the City. We
further agree to meet with city personnel and school district personnel to
work to develop recreational and educational programs for the residents on
site.
If you have any questions or concerns, we would be glad to address them
Vice President of Operations
AB/kp
Enclosures
9
•
0
CENTURY COURT - RICHFIELD
Staffing Breakdown
Administration
• Site Manager
• Assistant Manager
• Administrative Assistant
• 2 Full-time Leasing Agents
• 2 Part-time Leasing Agents
Maintenance
• Maintenance Supervisor
• Maintenance Supervisor Assistant
• 5 Technicians
• Carpenter
• 2 Painters
• 3 Groundskeepers
• 9 Caretakers
•
. RESUME`
Samuel R. St. Pierre, C.P.M.
Regional Property Manager
Mr. St. Pierre has.been directly involved in the property management industry
for the past twelve years. During this time he has been responsible for
supervising over 2,300 multifamily housing units throughout Minnesota,
Wisconsin and South Carolina. He has directed the entire process of
marketing, collection, property inspections, resident retention programs,
contract negotiation, budget preparation, market analysis and on-site training.
In addition, Mr. St. Pierre has been involved with and implemented several
major remodeling and capital improvement programs. He has an extensive
background working with our properties and is very knowledgeable with our
management requirements.
Currently, Mr. St. Pierre is responsible for the day-to-day operations of
DMS's entire management portfolio in the state of Minnesota. This represents
a portfolio of approximately fourteen partnerships representing 1,200
multifamily units. Mr. St. Pierre is an active member of the Minnesota Multi
Housing Association and serves on the Legislative, Convention and Inner
City Landlord committees of this association. In addition, Mr. St. Pierre is a
Trustee and Board Member of the Midwest Association of HUD
Management Agents. He has received the Certified Property Manager
designation awarded by the Institute of Real Estate Management and the
Executive Level designation from the National Assisted Housing
Management Association.
RESUME
Armand E. Brachman
Vice President of Operations
As Vice President of Operations-of Dominium, Mr: Brachman is responsible.
for the daily operations of Dominium Management Services, Inc: And is
responsible for the coordination and implementation of new project
development and acquisition for Dominium Group Incorporated.
Mr. Brachman joined the firm in 1979 after receiving his Bachelor of
Business Administration degree from the University of Wisconsin with
majors in Finance and Real Estate and Urban Land Economics. He has had
extensive experience in working with the various federal, state and local
0 housing programs. He currently is involved in every aspect of the
development process including the community and site identification, site
control, municipal approvals, architectural programming, financing,
constructive management, marketing and management.
Mr. Brachman's combined experience in both the development and property
ma nagement disciplines provides him with the necessary experience to
address both the short and long term goals for a successful multifamily
development.
0
RESUME
•
Pamela Stine, A.R.M.
District Property Manager
Ms: Stine has been-involve in the property management industry for the past
nine years. During this time she has been involved with multi site
management at government assisted housing as well as at market rate housing
throughout Illinois and Minnesota.
Ms. Stine hold the Accredited Residential Manager designation and is a
candidate for the Certified Property Manager designation through the Institute
of Real Estate Management.
•
•
RESIDENT SELECTION PLAN
FOR OCCUPANCY
IN
L`
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J:vmisc\docs\sec42.doc kp 3/23/95
Century Court Apartments
Richfield, Minnesota
Income Guided Housing Program
FAIR HOUSING AND EQUAL OPPORTUNITY REQUIREMENTS
0 STATEMENTS OF NON DISCRIMINATION
It is the policy of management to comply fully with Title VI of the Civil Rights Act of 1964,
The Federal Fair Housing Act, Executive Order 11063, Section 504 of the Rehabilitation Act
of 1973, the Age Discrimination Act of 1975, Title II of the Americans with Disabilities Act;
the Minnesota Human Rights Act, and any legislation protecting the individual rights of
residents, applicants or staff which may subsequently be enacted.
Under Federal Law it is illegal to discriminate against any person or group of persons because
of race, color, religion, sex, handicap, familial status or national origin.
The Minnesota Human Rights Act prohibits discrimination because of race, color, creed,
religion, national origin, sex, age, disability, marital status, status with regard to . public
assistance, sexual orientation, or familial status. In addition, owners must comply with local
fair housing and civil rights laws.
Century Court Apartments shall not:
• Deny to any family the opportunity to apply for housing, nor deny to any eligible
applicant the opportunity to lease housing suitable to its needs;
Provide housing which is different than that provided others;
• Subject a person to segregation or unequal or different treatment;
• Restrict a person's access to any benefit enjoyed by others in connection with the housing
program;
Treat a person differently in determining eligibility or other requirements for admission;
J:\misc\docs\sec42.doc kp 3/23/95
Page 1
• Deny a person the opportunity to participate in a planning or advisory group which is an
integral part of the housing program. 0
Century Court Apartments shall not automatically deny admission to a particular group or
category of otherwise eligible applicants; i.e., single head of households with children, elderly
pet owners, or families whose head or spouse is a student). Each applicant in a particular
group or category will be treated on an individual basis in the normal processing routine.
In reaching a reasonable accommodation with, or performing structural modifications for,
otherwise qualified individuals with handicaps, Management is not required to:
• Make structural alterations that require the removal or altering of a load-bearing structural
member;
• Provide an elevator in any multi-family housing development solely for the purpose of
locating accessible units above or below the grade level;
• Provide support services that are not already part of its housing programs;
• Take any action that would result in a fundamental alteration in the nature of the program
or service;
• Take any action that would result in an undue financial and administrative burden -on
Century Court Apartments.
•
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Page 2
PRIVACY POLICY
It is the policy of Century Court Apartments to protect the privacy of individuals covered by
the Federal Privacy Act of 1974, and to ensure the protection of such individuals verification
records maintained by the property.
This information may be released to appropriate federal, state and local agencies, when
relevant, and to civil, criminal or regulatory investigators and prosecutors. However, the
information will not be otherwise disclosed or released unless the individual gives written
authorization to do so.
This :privacy policy in no way limits Century Court Apartments' ability to collect such
information as it may need to determine eligibility, compute rent or determine an applicant's
0 suitability for tenancy.
Consistent with the intent of Section 504 of the Rehabilitation Act of 1973, any information
obtained on handicap or disability will be treated in a confidential manner.
•
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Page 3
GENERAL ELIGIBILITY CRITERIA .
To apply for income guided housing programs, applicants must qualify under the income
limits established for the type of development, and for the size and type of unit available. In
addition, every applicant must meet the tenant-selection criteria. The tenant selection criteria
are used to demonstrate the applicant's ability, whether alone or with assistance, to comply,
with the rules governing tenancy. The applicant will be judged on current and past behavior
and practices related to tenancy and not one any attribute or behavior which may be imputed
to a particular group or category of persons of which an applicant may be a member.
Applicants must also qualify in accordance with one or more of the following eligibility
criteria:
ELIGIBLE APPLICANTS
FAMILY
A family consists of
1. one or more persons whose income and resources are available to meet the
family's needs; or,.
2. a remaining member(s). A remaining family member(s) is any person(s), except
a live-in aide or foster child, who remains in the unit and was considered a
member of the household on the most recent lease or recertification form. To
qualify as a remaining family member the person(s) must:
a. be a member of the original tenant household or have become a member
of the tenant household subsequent to move-in with written approval
from management and remained m continuous occupancy up to and
including the time the original tenant of record vacates or dies;
b. be listed on the current lease; and
•
•
JAmisc\docs\sec42.doc kp 3/23/95
Page 4
C. have his/her income (if any) included in the household's annual income
for determining eligibility;
3. a displaced person. A displaced person(s) is one who has been displaced:
a. from an urban renewal area;
b. as a result of governmental actions; or"
c. as a result of a disaster determined by the President of the United States
to be a major disaster.
ELDERLY
An elderly household consists of either a single person or family where the head or spouse is
at least 62 years old, handicapped or disabled. The household may be two or more elderly,
handicapped or disabled persons who are living together, or one or more such persons living
with someone essential to their care or well-being, i.e. a live-in aide/attendant.
•
HANDICAPPED
A handicapped household includes a person who is handicapped by having a physical,
developmental or mental impairment which:
1. is expected to be of a long, continued and indefinite duration.
2. substantially impedes his or her ability to live independently.
3. is of such a nature that such ability could be improved by more suitable housing
conditions.
•
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Page 5
DISABLED
A disabled household includes a person who is under a disability as defined in Section 223 of
the Social Security Act, or in Section 102(7) of the Developmental Disabilities Assistance and
Bill of Rights Act (42 U.S.C. 6001[7]).
Section 223 of the Social Security. Act (42 U.S.C. 423) defines disability as:
1. inability to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in death or
which has lasted or can be expected to last for a continuous period of not less than 12
months; or
2. in the case of an individual who has attained the age of 55 and is blind (within the
meaning of "blindness" as defined in Section 416(i)(1) of the Social Security Act), and is
unable by reason of such blindness to engage in substantial gainful activity in which s/he
has previously engaged with some regularity and over a substantial period of time.
Section 102(7) of the Developmental Disabilities Assistance and Bill of Rights Act (42 U.S.C.
6007[7]) defines disability, as severe, chronic disability of a person which: 0
1. is attributable to a mental or physical impairment or combination of mental and physical
impairment;
2. is manifested before the person attains age twenty-two;
3. is likely to continue indefinitely;
4. results in substantial functional limitations in three or more of the following areas of major
life activity:
• self-care,
• receptive and expressive language,
• learning,
• mobility,
• self-direction,
• capacity for independent living, and
• economic self-sufficiency; and
•
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Page 6
5. reflects the person's need for a combination and sequence of special interdisciplinary, or
generic care, treatment, or other services which are of lifelong or extended duration and
are individually planned and coordinated.
INELIGIBLE APPLICANTS
An applicant is considered ineligible if:
A. the household's annual gross income is greater than the applicable income limit
established, i.e., Exhibit A --- Income Guidelines.
B. management determines that the applicant and/or household member(s) do not meet
the tenant selection criteria or the criteria under which the property was developed.
GENERAL OCCUPANCY STANDARDS
1 bedroom units 1-2 persons
0 Units with Special Features
Not applicable to Century Court Apartments
The owner is required to establish reasonable occupancy standards that will:
•. assist as many people as possible, without overcrowding, and;
• minimize vacancies:
Owners must comply with all reasonable state and local health and safety restrictions
regarding the maximum number of persons permitted to occupy a unit. In the absence of such
restrictions, overcrowding is deemed to occur when the total number of persons in the unit
exceeds two persons per habitable sleeping room. Additional persons may be allowed when a
C?
JAmisc\docs\sec42.doc kp 3/23/95
Page 7
habitable sleeping room provides at least 50 square feet per person. A habitable sleeping room
is any room except the following: i
• kitchen,
• bathroom,
• hallway, or
• dining room.
More than two persons may occupy a bedroom provided there is sufficient square footage in
the bedroom to meet local standards. If local standards permit, the living room may be
considered a habitable sleeping room, therefore, increasing the overall occupancy level.
Owners should take into consideration the makeup of the household when determining the
appropriately sized unit. Persons of different generations, opposite gender and unrelated
adults should not be required to share a bedroom. However, the final decision as to the
number of persons residing in a unit shall be left to the applicant, provided the unit is not
overcrowded or under occupied.
Units accessible to the mobility, visual and/or hearing impaired shall be used by families that
need the special features of the unit. Owners may lease these units to families who do not
need the special features when no current resident or no one on the waiting list need such a
unit. The housing provider must, however, have a lease provision that requires the family to
transfer to another suitable unit when someone can document the need for the special features
of the unit.
C. Physically Handicapped/Disabled Applicants
For units accessible to or adaptable for persons with mobility, visual or hearing
impairments, households containing at least one person with such an impairment will
have first priority, (as applicable for a particular unit's features).
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Page 8
•
NOTE: Current residents>in good standing requiring accessibletadaptable units shall
be given priority over applicants requiring the same type of unit. ` Where no
such applicants or.current residents are at .hand, management reserves the
right to hold such units available while outreach :efforts are in process to
obtain applicants with :need for such units. Where non-handicapped persons
are moved into units designed to meet special needs, they must agree to move
to the first available appropriately sized unit with no such design features
available should .an applicant or current resident:requirean accessible unit of
the type eurrentlyoccupied :by the non-handicapped ;person.
D. In-House Transfer
Tenants may be required to transfer to another unit within the development to correct
inappropriate unit size. -If so, the family must transfer within thirty (30) days after
receiving notice from the owner of the availability. The owner may require a new
security deposit on the unit into which the tenant is being transferred. If the tenant has
any unpaid rentlutility expenses or charges assessed for tenant damages the owner may
require payment prior to the transfer but not more than thirty (30) days from the date
of transfer into the new unit.
•
The owner shall coordinate in-house transfers with housing applicants from the
waiting list to assure a reasonable balance of tenant selection is maintained.
The tenant will be considered for a unit transfer when the following has occurred:
• . increase in family composition, or,
• ' decrease in family composition, or,
• family circumstances necessitate a larger unit; i.e. medical reasons, and,
• tenant has occupied current unit at least one year
if no appropriately sized unit is available the tenant will be placed on an in-house
transfer waiting list in accordance with the date the family met the eligibility criteria.
•
JAmiscWocslsec42.doc kp 3/23/95
Page 9
QUALIFYING FOR ADMISSION
It is management's policy to accept and process applications in accordance with applicable
regulations.
Every application must be completed in its entirety, with or without assistance, and signed
and dated by the head of the household and co-head(s), and all household members 18 years
and older, if applicable. All members of the household shall be listed on the application form.
Staff will assist any applicant who might have trouble completing the application form. This
assistance might take the form of answering questions about the application, helping
applicants who might have literacy, vision or language problems and, in .general, making it
possible for interested parties to apply for housing. Applications that are incomplete and/or
have not been signed and dated as required will not be processed.
Whenever possible, communications with applicants will be by first class mail. Failure to -
respond to letters may result in withdrawal of an application from further processing.
Management may make exceptions to the procedures described herein to take into account
circumstances beyond the applicant's control; i.e., medical emergencies or extreme weather
conditions. If .failure to respond is due to disability reasonable accommodation will be made
by management.
No decisions to accept or reject applications shall be made until all verifications prompted by
the application form have been received. The following items will be verified by management
to determine eligibility and suitability for admission to the development:
• Eligibility information
• Previous Rental History
• Annual Income
• Credit Report
J:Vmisc\docs\sec42.doc kp 3/23/95
Page 10
• Assets and Asset Income
• Criminal Background Check
• Social Security Number for all persons in the household age 6 years and older.
Management will be the final judge of what constitutes adequate and credible documentation.
If there is any doubt about the truthfulness or reliability of'information received, alternative
methods will be pursued until management is satisfied that the documentation obtained is the
best available.
•
•
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Page 11
ADMINISTRATION OF THE WAITING LIST .
It is the policy of management to administer its Waiting List as required by HUD handbooks
and regulations. Accepting an applicant from a lower waiting list position before one in a
higher position violates policy and maybe regarded as being discriminatory.
An applicant shall be offered no more than two suitable vacancies before being placd at the
bottom of the eligible waiting list. The reasonableness of the rejection will be determined by
the owner and will so be documented with the applicant's application for housing. For
handicapped/disabled applicants, reasonable accommodation needs shall be reviewed and
made available fo the fullest extent allowed. In addition, those applicants who have been
placed at the bottomw of the waiting list will have the effective date of their application
changed to the date of the second rejection.
Note: Applicants who can show that the unit was rejected for reasons that were related to a,
disability, and not the fault of the applicant,;shAu remain on the waiting list and their
application will retain its original date.
A. Handicapped Accessible Units
Applicants requiring the features of an accessible unit; i.e., a disabled family, shall be
offered an accessible unit, of appropriate bedroom size, before applicants not requiring
the accessible features regardless of the disabled family's position on the waiting list.
If the disabled family is the next applicant on the waiting list and the available unit, of
appropriate bedroom size, is not an accessible unit, management will make the
available unit accessible (for the disabled family to rent) to the greatest. extent possible
pursuant to Section 504 of the Rehabilitation Act of 1973, as amended.
B. Updating the Waiting List
The owner shall update the waiting list at least annually to determine if applicants are
still interested and eligible to remain on the waiting list.
J:4nisc\docs\sec42.doc kp 3/23/95
Page 12
The owner shall, at the time of each annual update, obtain current applicant
information on at least the following:
household characteristics; i.e., number of family members
• income and assets; and,
• . housing preferences
The updated information shall be obtained from the applicant in writing and certified
by the tenant's dated signature that the information provided is true and correct. The
owner will notify each applicant by mail requesting the above information and
confirmation of its interest in remaining on the waiting list. The owner must specify a
reasonable time frame in which the applicant is to respond; i.e., 15 days. If the
applicant replies affirmatively, his/her application will retain its position on the waiting
list. If the reply is negative, the applicant's name will be removed from the waiting list.
If no reply is received within the specified time frame, a final letter will be sent to the
last known address stating that the applicant's name is being removed from the waiting
list on a specific date; i.e., 5 days from the date of the letter.
•
•
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Page 13
SCREENING CRITERIA .
Management will not employ criteria that are unrelated to an applicant's ability to meet
essential lease requirements. It is unlawful to make an inquiry to determine whether an
applicant .a. person intending to reside in the unit after it is rented or made available, or any
persons associated with that person, has a handicap, or to make inquiry as to the nature or
severity of a handicap of such a person.
1. Upon receipt of a completed application the applicant shall be screened considering
factors that include, but are not limited to, the following:
• Demonstrated ability to pay rent and utilities on time;
• Comments from current and former landlords: endorsement from at least two is
preferred. Inquiry will be made pertaining to current/past rental history including
nonpayment of rent; failure to cooperate with applicable recertification procedures;
violations of house rules; violations of lease; history of disruptive behavior;
housekeeping habits; termination of assistance for fraud; and/or previous evictions.
For individuals with no landlord reference, management must establish criteria as
to: 1) who is acceptable to act in the place of a landlord; and 2) the type of
inquiry(ies) that will be made to provide information and/or substantiate that an
acceptable current/former tenant/landlord-like relationship(s) exists(ed);
• Credit references. Credit checks may be useful when no rent payment history is
available. However, lack of a credit history, as opposed to a poor credit history, is
not sufficient justification to reject an applicant;
• Drug related or criminal history record. Inquiries may be made of each applicant
18 years of age and older to determine if there has been an arrest/convictions
involving the illegal use of a controlled substance by consulting a third party;
• Housekeeping habits. Housekeeping criteria are not intended to exclude
households whose housekeeping is only superficially unclean or disorderly if such
conditions would not appear to affect their or others health, safety and/or welfare;
• Units for persons with handicaps. For applicants who require a handicapped
accessible unit inquiries may be made to determine whether an applicant is
J:\misc\docs\sec42.doc kp 3/23/95
Page 14
Qualified for a unit that is available only to persons with handicaps or to persons
with a particular type of handicap. Inquiries may be made to determine whether an
applicant for such a unit is qualified for a priori ty that is made available to persons
with handicaps or to persons with a particular type of handicap;
• Consideration of Extenuatin Mitigating Circumstances in the Screening Process.
Owners may consider extenuating/mitigating circumstances in evaluating
information obtained during the screening process to assist in determining the
acceptability of an. applicant.
2. The following factors will not be used when screening an applicant:
• Physical examinations: Owners may not require physical examinations or medical
testing as a condition of admission. Owners may uniformly require all applicants to
furnish evidence of ability to meet the obligations of tenancy but may not impose
greater burdens on individuals with handicaps;
• Meals and Other Services: Owners must not require tenants to participate in a
meals program or establish other mandatory charges for services;
. Donations or contributions: Owners must not require a donation, contribution, or
membership fee as a condition of admission. Owners may not require any.
payments not provided in the lease; or
3. The owner must either:
• accept.the applicant,
a. provide housing;
and,
b. place the applicant on the waiting list if a unit of suitable size is not
available;
• reject the applicant.
or,
If the owner determines the family is eligible and is otherwise acceptable, and a unit is
available, the owner will assign the family a unit of appropriate size in accordance
with the General Occupancy Standards.
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Page 15
VERIFICATION REQUIREMENTS
Management shall obtain verifications in compliance with requirements set forth all income
guided housing' program compliance. No decision to accept or reject an application shall be
made until all verifications prompted by the application form have been collected and
necessary Follow-Up Interview has been performed.
A.
Types of Verification Required
All information relative to the following items must be verified as described in these
procedures:
Eligibility for admission, such as:
• Income, assets and asset income;
• Family composition; and
• Social security numbers.
Compliance with Resident Selection Criteria, such as:
• Documented ability and willingness to abide by lease requirements, and, if
applicable, housing program requirements;
• Previous history of tenancy; and/or
• Absence of current or history of criminal activity of any household member.
All the above information must be documented and appropriate verification forms or
letters placed in the applicant or resident file.
B.
Preferred Types of Verification
Verifications shall be attempted in the following order:
1. Third-party written.
2. Third-party oral with a record kept in the file.
3. Review of documents provided by the family.
•
11
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Page 16
4. In the absence of any of the above: affidavits from the family.
Each file will be documented to show that management attempted to obtain third-Party
written documentation before relying on some less acceptable form of information.
C. Sources.of Information
• The applicant by means of interviews;
• Present and former landlords, or housing providers;
• Present and former employers;
• Agencies providing credit, criminal and landlord history;
• Family social workers, parole officers, court records, drug treatment centers,
clinics, physicians, clergy; and/or
• Police departments.
D. Forms of Verification
Documentation employed as part of the verification process may include, but are not
limited to:
• Applications and/or forms completed as part of the interview process and signed by
the applicant;
• Verification forms completed and signed by third parties;
• Reports of interviews;
• Letters; and/or
• Notes of telephone conversations with reliable sources.
Management staff' will be the final judge of the credibility of any verification
submitted by an applicant. If staff considers documentation to be doubtful, it will be
reviewed by the Regional Property Manager who will make a ruling about its
credibility. Staff will continue to pursue credible documentation until it is obtained or
the applicant is rejected for failing to provide required documentation.
E. Verification Time Frame
Only verified information that is less than ninety (90) days old may be used for
certification or recertification. Verifications may be extended for thirty (30) days with
a telephone update. (A record of the update must be placed in the applicant's file.)
Verified information not subject to change (such as a person's date of birth) need not
be re-verified.
JAniisc\docs\sec42.doc kp 3/23/95
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Information obtained which is subject to change, and for which verification are more than 120
days old, must be re-verified.
•
•
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Page 18
REJECTING APPLICANTS
Applicants may be rejected if
• they are ineligible;
• the household's characteristics are not appropriate for the size or type of units that
are - available;
• they do not meet the resident selection criteria; or
• they fail to disclose and document all Social Security numbers or execute a
certification when numbers have not been assigned;
• an applicant's inability to fizlfill obligations and comply with all terms of the
previous/current Lease/Rental Agreement;
• a record of chronic late, underpayment or nonpayment of rightful obligations,
including rent and utilities (3 or more late payment of rent during any 12 month
period and/or a rating of R3 or higher on any credit report)
• a record of disruptive behavior (2 or more lease violations documented by previous
landlord);
• a record of destruction of property (forfieture of security deposit or any damage
deposit due to damage; neglect or desturction of property);
• a record of poor living or housekeeping habits;
• a history of criminal activity involving crimes of physical violence to persons or
property, or a record of other criminal acts which may endanger the health, safety
or welfare of other residents (any felony conviction involving endangerment to
person or property);
• eviction for material non-compliance, or "other good cause", from current or
previous housing;
•
J:Unisc\docs\sec42.doc kp 3/23/95
Page 19
• a history of activities that would be injurious to the reputation of the property
and/or be likely to cause an increase in the rate of hazard insurance on the
property;
• purposeful falsification, misrepresentation or withholding of information or
submission of inaccurate and/or incomplete information on any application or
during the interview related to. eligibility, award of preference for admission,
family composition or rent;
• current or recent problems involving chemical or drug dependency resulting in any
of the other reasons for non-selection; and/or
• refusal to comply with housing program requirements, policies and/or procedures.
:NOTE: Unwitting errors' that do not secure an advantage with regard to program :
eligibility preferences, or rent wilt not'be used as a basis to reject applicants.
Applicants may be denied 'particular units and placed on a waiting list if the
household's characteristics are not appropriate for the size or type of units that are.
available at that time.
If management does not place an applicant on the waiting list or immediately process
the applicant for admission, management must promptly notify the applicant in writing
of the rejections, and explain in the notice the reasons for the rejection,
and,
• that the applicant has fourteen (14) days to respond in writing or to request a
meeting to discuss the rejection.
• if the applicant is an individual with handicaps, the applicant may inform
management of this fact and may request management to make reasonable
accommodations in the policies or practices to enable the applicant equal
opportunity.
Any meeting with the applicant or review of the applicant's written response must be
conducted by a member of management staff who did not make the initial decision to
reject the applicant.
•
•
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Page 20
If the applicant appeals the rejection, management must give the applicant a written
final decision within five (5) days of the response or meeting.
Management must keep the following materials on file for at least three (3) years:
application, initial rejection notice, any applicant reply, owner's final response, and all
interview and verified information on which the owner based the rejection.
MITIGATING CIRCUMSTANCES
Management will hold a second interview with any applicant known to have a disability or
handicap who cannot meet one or more of the tenant screening criteria. The purpose of this
interview is to determine whether it is possible to admit the applicant through consideration of
mitigating circumstances or by applying reasonable accommodation.
Mitigating circumstances would be facts (that can be verified) that would overcome or
outweigh information gathered in the tenant screening process.
Acceptable evidence of mitigating circumstances may include the following:
• Verification that unacceptable past behavior is either no longer in effect or otherwise
controlled.
• Applicants who claim unacceptable behavior resulting from alcoholism or drug addiction
must verify that they are not currently engaging in alcohol abuse or the use of illegal
drugs. Current abuse is defined as use of more than 120 days prior to the date of
application.
During the period that the applicant is claiming no current use, the applicant's behavior in the
previously unacceptable area must have shown improvement. Unimproved behavior shall be
taken to construe that either the applicant's unacceptable behavior was not caused by alcohol
or drug abuse, or the applicant is still engaging in alcohol or drug abuse. Lack of improvement
in a previously unacceptable area shall result in a rejected application.
•
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Page 21
Management shall also have the right to request further information reasonably needed to
verify a mitigating circumstance, even if such information is of a medically confidential
nature. If the :applicant refuses to provide or give access to such further information,
management will give no further consideration to the mitigating circumstance.
•
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APPLICANT INTERVIEW
At the time an appropriate unit becomes available, or sooner, the owner must interview the
applicant and obtain current information about the family's circumstances. Any question that
is asked of one applicant must be asked of all applicants. A final decision on eligibility cannot
be made until all verifications are complete.
During the interview the owner must:
• Confirm and update all information provided on the application. If the applicant is
determined ineligible the owner must comply with proper procedures for rejection;
• Explain program requirements, verification procedures, and penalties for false
information.
• Obtain family income and composition information needed to certify eligibility. Any
changes in family income and composition since the date of application should also be
obtained;
• Review the financial information on the application and specifically ask the applicant
whether any member of the household receives the types of income or assets as listed on
the application. If it seems likely that an applicant is receiving a form of income not
reported on the application, ask the applicant about that source of income and document
the applicant's response in the file;
• Ask the head of household, spouse, co-head(s) and household members age 18 years and
over to give a written verification as to whether any family member did/did not dispose of
any assets for less that fair market value during the two years preceding the effective date
of the verification;
• Tell the family that a final decision on eligibility cannot be made until all verifications are
complete; and
• Provide the household with Federal and State Data Privacy information.
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EXHIBIT A •
INCOME GUIDELINES
Income limits for Hennepin County, effective January 1,1994_
Number of Persons . 60% of Median Income
$ 21,400
2 $ 24,500
0
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•
E
•
MANAGEMENT PLAN
RICHFIELD HOUSING ASSOCIATES LIMITED PARTNERSHIP
INTRODUCTION
Richfield Housing Associates Limited Partnership (Century Court) is a housing development consisting of
1,142 units divided between Century Court South (306 units), Century Court South "63" (136 units), and
Century Court West (700 units). The development is located in Richfield, Minnesota
THE OWNER
The project is privately owned by Richfield Housing Associates Limited Partnership, 3140 Harbor Lane, Suite
102, Plymouth, Minnesota. The Owners or their Agent will contract with persons to be named as on-site
managers for the development.
IDENTITY OF INTEREST
Dominium Management Services, Inc. (DMS) provides all management functions for the property.
Dominium Management Services is a closely held corporation in which two of the General Partners are
principals. Northwest Unit Investment Company L.L.P. holds a limited partnership interest. This does not
create a conflict of interest or interfere with the proper management of the development.
1. RESPONSIBILITIES OF OWNER
A. The Owner is responsible for all pertinent requirements to comply with Section 42 of the
Internal Revenue Code. The Owner's representative (Agent) shall have the responsibility of
marketing, maintenance, tenant-management relationships, personnel and physical control of
the administration of the project. The Owner's representative (Agent) with direct responsibility
for this Project is Dominium Management Services 3140 Harbor Lane, Plymouth, Minnesota
55447-5120, telephone number (612) 559-1495. The day-today operations of the Project are
the responsibility of the on-site managers. All maintenance, rent collection and leasing
problems which cannot be resolved on-site or by the Regional Coordinator are directed to Mr.
: Sam St. Pierre of Dominium Management Services, Inc., as are security deposit refunds,
banking procedures, and office supply questions. Mr. Armand Brachman is Vice President of
Operations for Dominium Management Services and is responsible for the establishment of all
Dominium Management Services management policies.
B. The Management Agent must consult the Owner on (1) those items not considered routine
management and maintenance, and (2) any non-recurring expenses over S 1,000.00.
C. Except for the conditions outlined in Item B above, the Management Agent may make those
decisions he deems necessary for the effective operation of the Project.
D. Dominium Management Services shall have the day-today responsibilities for the
administration and operation of the Project. These duties shall include, but are not limited to:
Page 1
1. Thorough familiarization with the character, location, construction, layout plan and
operation of the Project; and especially of the electrical, heating, plumbing, air
conditioning and ventilation systems, elevator and all other mechanical equipment.
2.. Preparation of all dwelling leases, parking permits, etc. and the execution of the same
in the name of the Owner.
3. Recertification of tenants on an annual basis and maintenance of an up-to-date waiting
list of eligible applicants.
-4. Collection of rents, charges and other account receivables on behalf of the Owner in
conjunction with the management and operation of the Project. Such receipts will be
deposited in a Federally insured bank separate from all other accounts and funds.
5. Collection, deposits and disbursement of security deposits in an interest bearing.
account, separate from all other accounts and funds, in a bank whose deposits are
Federally insured.
6. Development of daily maintenance schedules and practices to cause the Project to be
kept at all times in a condition acceptable to the Owner, including ordinary painting,
decorating, carpentry, grounds care, minor plumbing, electrical, heating, ventilating, air
conditioning repairs and other such maintenance repair work which may be necessary.
7. Maintenance of long range preventive maintenance schedule.
8. Enforcement of contracts with qualified independent contractors for maintenance and
repair of air conditioning systems, and for extraordinary repairs beyond the capability
of regular maintenance employees.
9. Arrange for water, electricity, gas, sewage and trash disposal, vermin extermination,
decorating, laundry facilities, telephone services with appropriate municipal and private
contractors; enter into such contracts as may be necessary on behalf of the Owner.
10. The manager shall be an employee(s) of the Agent. All applicable, non-discrimination
(EEO) regulations of the Federal govermnent and Dominium Management Services will
be followed in hiring such personnel.
11. Maintain a comprehensive system of records, books and accounts in a manner
conforming to Section 42 of the Internal Revenue Code, generally accepted auditing
-standards and governmental auditing standards for financial and compliance audits
issued by the Comptroller General of the United States.
12. Purchase of all necessary maintenance and administrative supplies for efficient
operation of the Project.
13. Institute and maintain an active community service and tenant involvement which shall
include services from the local community resources.
14. Affirmative action toward the establishment of a cooperative working relationship with
the tenants.
15. Other duties and responsibilities as they become apparent and appropriate for the
management of the Project.
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Page 2
2. PERSONNEL POLICY AND STAFFING ARRANGEMENTS
A. Dominium Management Services subscribes to and actively supports the Civil Rights Law of
1964. Specifically, we nor any of our employees, will not deny employment to any applicant
on the basis of race, religion, color, national origin, sex or marital status. At this time
Dominium Management Services has eight minority persons on its staff.
B. Site personnel are available from 8:30 a.m. to 5:00 p.m., Monday through Friday, and for
emergency situations after hours.
C. The on-site manager will be responsible for all day-to-day maintenance issues,
administrative/management functions which relate to tenant certifications, project waiting-list,
lease processing and Dominium Management Services monthly occupancy reports. Immediate
issues will be directed to Dominium Management Services Property Coordinator. Any issues
or problems which cannot be resolved by these individuals will be directed to Mr. Sam St.
Pierre of Dominium Management Services. Occupancy problems will be directed to Mr.
Dwight Olinger as well as security deposit refunds, banking procedures and office supply
questions. Mr. Sam St. Pierre of Dominium Management Services will supervise the overall
administration of this property. A proposed staff breakdown is attached as Addendum C.
D. Dominium Management Services Operations and Procedures Manual is received by each
employee and a training seminar to familiarize them with that manual is held prior to their
starting employment with Dominium. Every employee thereafter becomes responsible for its
complete implementation.
Below is the on-site manager's job description:
To be responsible under the supervision of the Property Coordinator or Regional Property
Manager for all phases of the day-to-day operation of the property including but not limited to
general maintenance of the physical plant to direct and control all personnel and resources to
the end that the property is maintained at all times in good physical condition.
Duties and Responsibilities:
1. To be responsible for work performed by all staff members under his or her direction.
2. Hire and terminate employees in accordance with the company's policies and under the
direction of the Property Coordinator.
3. Adhere to all company personnel directives as per the Dominium Management Services
Operations and Procedures Manual.
4. Collect rents and refer delinquent accounts to Property Coordinator.
5. Maintain all necessary files and records in compliance with Dominium Management
Service's policies and procedures and with Section 42 of the Internal Revenue Code.
6. Adhere to all appropriate company accounting directives including but not limited to:
(a) petty cash
(b) rent roll, summary and recap
(c) other monthly maintenance reports
(d) special accounting items
Page 3
7. Make bank deposits.
8. Purchase necessary supplies for the Project in accordance with company policy.
9. Supervise outside contractors working on the property.
10. Handle all physical details of move-in and move-outs giving special attention to
.. apartment inspection check-ins and check-outs.
11. Ensure the tenants are provided with a clean, safe and well maintained community.
12. Handle all minor maintenance, lawn care, trimming of shrubs and snow removal.
13. Other duties as may be assigned..
E. An assistant Manager will assist the On-Site Manager with the daily operations of the Project.
The Owner/Management representative will meet with a representative of the City at least
semi annually to discuss any issues which may be of interest to the City involving Century
Court. This representative will also work with the City Police Department with regard to any
concerns or issues they may have.
F. Other site personnel such as leasing agents, maintenance technicians and caretakers will be
hired and assigned duties as necessary.
3. MARKETING PLANS AND PROCEDURES
A. The units will be advertised and marketed in compliance with appropriate Federal, State and
local housing laws and regulations.
B. Applications will be taken at the on-site office. 0
C. The project will advertise as needed in the local newspaper and other media sources which
seem appropriate for the market.
D. Dominium Management Services includes the Statewide TTD number in all marketing
material and advertising as well as posting it in the entry of each building. We also ask each
manager to make a local contact with an individual proficient in "signing" so if the need would
arise we would contract with this individual to sign for necessary management resident
meetings and discussions.
In the event an applicant is a visually impaired, leases and other occupancy forms will be
made available in large print or if requested, local contacts would be established for an
unrelated individual to read and interpret information, forms and documents for the applicant.
E. Reasonable accommodations that would be considered include; range with front mount knobs,
water faucet handles, lever style door knobs, increase illuminated light fixtures, assignment of
handicapped parking stall, special functions for smoke detectors and doorbell systems.
F. When the project was originally developed there were no handicapped style units constructed.
However, because of the architectural design of the building, modification of a garden style
unit to an accessible unit is cost prohibitive. The only changes made by management would be
the reasonable accommodations identified above. In the event an applicant would want to
make structural changes at their expense the plans would be reviewed by the Agent, Owner
and Architect. At that time a request may be made that the applicant escrow the estimated
amount to return the unit to its original condition to the Agent.
•
Page 4
G. A waiting list (Exhibit B-14) will be used for the Project. The waiting list will be used as
apartments become available for re-rental. All potential tenants will be required to complete a
pre-application form before being placed on the waiting list. The waiting list will be updated
annually and will be maintained by the on-site caretaker and a copy will be kept in the Project
office.
H. To the extent possible, Dominium Management Services will recommend a typical unit be
made available to allow prospective tenants the opportunity to inspect a unit prior to
occupancy. Prior to move-in/move-out inspection, the tenant will receive a copy of this
inspection checklist and one copy will be retained in the tenant's file.
1. Explanations and instructions for specific care of their unit and appliances will be given to the
tenants on an individual basis by the on-site manager as the tenants move in.
All applications are reviewed for accuracy and Section 42 compliance at Dominium
Management Services' corporate office in Plymouth, Minnesota by Dwight Olinger.
4. RENTAL POLICIES
A. All DMS staff must obey all applicable fair housing laws, specifically Title VIII of the Civil
Right Act of 1968. In addition, other policies may be developed for each particular property
as it relates to their specific need.
B. Prior to anyone being accepted for occupancy, and Application for Lease must be completed
by the prospective resident. All information provided by the resident must be verified verbally
and in writing through a credit service as directed by DMS.
C. Each applicant must pay an application fee and security deposit in full. The application fee
the resident pays for the apartment will be a separate check from their security deposit. If the
resident is rejected, this application fee will not be refunded. However, the security deposit
will be refunded with fourteen (14) days.
Any request by an applicant for special term arrangements MUST be approved by the on-site
manager.
5. RESIDENT LEASING POLICIES
A. Leasing policies and procedures are established in accordance with DMS Operations and
Procedures Manual. (Attached as Addendum A.)
B. DMS employees are knowledgeable of required lease clauses and prohibited lease clauses.
•
Page 5
C. All rules for occupancy are outlined in the lease and resident handbook which each resident
receives. In addition, a copy of the resident handbook and house rules are posted in the office
and available for review.
D. After the completed leases have been signed, one will be given to the resident and one will be
placed in the resident's file.
Prior to anyone moving in, the following information must be in the resident's file:
1. An original Apartment Lease, signed by the resident(s) and on-site manager.
2. An original Application for Lease signed by the resident(s) and the Leasing Consultant.
3. One original Rules and Regulations form signed by the resident(s).
4. A copy of both the Security Deposit Check and the Application Check.
5. A Move-In Checklist signed by the resident(s).
6. Completed bonding paper work and Third Party Employment Verification, if applicable.
7. The original Welcome Guest Card.
8. Addendums executed for Lease term.
6. RENT COLLECTION POLICIES AND PROCEDURES
.!
A. Resident's rent will be due and payable in advance on the first working day of the month.
Rents will normally be considered delinquent on the fifth of the month. If the resident's rent
has not been paid by the tenth of the month, or no other arrangements have been made by the
resident to satisfy his rent, applicable state laws will be followed in issuing an eviction notice
to the resident. A late fee will be assessed after the fifth day of the month.
Rents are to be paid at the on-site office. Rental collection and the issuance of rent receipts
will be the on-site manager's responsibility.
All rents will be collected at the on-site office. Provisions will be made for an after-hours
depository.
Generally accepted accounting procedures will be used in recording resident payment and for
the deposit of resident rents in the local bank. Partial payment of rent will not be accepted.
Residents may pre-pay their rent.
B. Security deposits will be required of all residents prior to them occupying a unit. All security
deposits and interest earned will be credited to the residents and returned at the time of move-
out provided no rent, late charges or damages are due the Owner.
7. RENT INCREASES
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Page 6
A. It is the opinion of the Owner and DMS that rent amount and increases will be reviewed
carefully to assume we are attracting good residents and not establish a rental amount too high
to not attract a good resident or lose good residents due to the increase.
B. Residents will be notified of all proposed changes prior to their existing lease expiring.
8. MAINTENANCE AND-REPAIR PROGRAM
A. DMS uses a preventive maintenance program in all their projects to extend the life of the
project. A complete description of this plan is outlined in DMS Operations and Procedures
Manual. The preventive maintenance program will be monitored and implemented by the on-
site manager.
B. If available, the Project's as-built plans and specifications will be located at the on-site office.
It will be the responsibility of DMS to update plans and specifications when Project
modifications are made.
C. Maintenance.
1. Subject to the Owner's or his Agent's approval, the on-site manager will contract with
qualified independent contractors for the maintenance and repair of all air conditioning
systems, elevators, and vermin extermination and for extraordinary maintenance
request. For work to be completed in individual apartments, the resident is asked to
complete a simple "Service Request" form available at the on-site office. These forms
will be in duplicate and one copy will be retained by the on-site manager as part of the
Project's records. Emergency repair requests will be made directly to the on-site
manager in the most expedient manner possible. All minor maintenance repairs will be
completed within a reasonable time after the resident' request.
2. Special attention will be paid to smoke alarms, fire extinguishers, outside lighting and
ice removal. All of these items will receive top priority. These items are covered
thoroughly in the maintenance section of DMS Operations and Procedures Manual.
Prior to a resident moving out, the on-site manager will schedule a move-out inspection
with the resident. Any damages beyond normal wear and tear will be determined by
comparing the original move-in/move-out checklist with the current condition of the
apartment unit. The resident will then be informed of any such damages or repairs
which they will personally be responsible for. All necessary repair and damages will
then be corrected. No vacated unit will be re-rented until all necessary repairs and/or
redecorating has been completed.
4. Interior painting of units will be scheduled on the basis of move-in/move-out
inspections. All apartments are expected to be painted once every four years.
5. Major repairs will be handled through coordinating the efforts of the on-site manager,
DMS and its employees, and the Owner if any repairs are in excess of $1,000.
Page 7
6. The on-site manager will be responsible for daily removal or changing of trash bins to
accommodate garbage and trash deposits. 0
7. The on-site manager will be responsible for grounds upkeep and maintenance.
Vacuuming of carpets in public areas and halls will be done at lease twice a week or
more often as needed. Mopping of vinyl tile in public areas will be done once a week
or as needed. Waxing will be completed as needed. The glass in all public areas will be
cleaned, dusting, cleaning and emptying of waste paper baskets, sand urns, ashtrays,
etc., in all public areas will be done daily or as needed.
D. Residents are instructed to report major and/or minor repair maintenance items as identified in
paragraph C above.
9. SUPPLEMENTAL SERVICES
A. DMS will establish and maintain a comprehensive system of record, books and accounts in a
manner satisfactory to the Owner. All, Project records will be prepared by DMS employees.
B. If established, replacement reserve funds will be held in a separate account.
C. DMS uses Skyline accounting programs. The Property Accountant and Regional Property
Manager prepares these forms.
D. With respect to each fiscal year-end during the term of the management agreement, when
required, DMS will have an annual accounting compilation based upon the preparer's
examination of the books and records of the Owner and DMS. The report will be certified by
the preparer and DMS, and will be submitted to the Owner within sixty(60) days after the end
of the fiscal year, for the Owner's further certification and submission. Compensation for the
preparer's services will be considered an operating expense of the development.
E. A separate file will be maintained for each resident. The file will include the following items:
the application, income verification forms, lease agreement and attachments, inspection
reports for moving-in/moving-out, correspondence and notices to the resident, and any other
necessary information. These files will be retained for at least three years after the resident has
move.out. These records will be handled and maintained by the on-site manager with direct
supervision form DMS corporate office.
F. All resident files, records, books and accounts will be subject to examination at reasonable
hours by any authorized representative of the Owner at DMS corporate office. Mr. Sam St.
Pierre, Regional Property Manager of DMS, can be contacted to review the records.
11. ENERGY CONSERVATION
A. Residents have direct control of utility usage in their individual units. These utilities will
include electricity.
B. Management has direct control of utility usage in all community, maintenance and parking
areas. These utilities will include gas, water, sewer and electricity.
Page 8
C. Management is responsible to implement, however, not limited to the following energy
conservation practices:
1. To strategically turn off hallway lights as to conserve energy but provide adequate
lighting.
2. To use energy efficient light bulbs.
3. To insulate hot water heaters, storage tanks and pipes.
4. To set hot water heaters at approximately 130° and check the possibility of shutting a
hot water heater down if applicable.
5. To meet State and Federal suggested temperature settings in hallways and community
areas.
6. Lights in the community and maintenance areas are to remain off unless they are in use.
7. To make periodic checks of building insulation and circulation.
D. Residents will be encouraged to implement energy conservation measures by the receipt of
written materials and seminars when they are available.
E. Resident will be oriented to energy conservation measures during their initial resident
orientation meeting. Also, when available, each resident will receive literature as it relates to
energy conservation.
0 12. RESIDENT/MANAGEMENT RELATIONS
It is recognized by DMS that establishing good resident relations is one of the most important
aspects of good property management. Therefore, special emphasis will be placed on establishing a
friendly and personal rapport-with each resident.
A.' Orientation of the resident to the Project will be accomplished by the Management Agent and
on-site manager through a resident orientation meeting.
B. The on-site manager is expected to stimulate as much as possible the development of social
activities among the Project's residents.
C. The on-site manager's role is to try and motivate the residents to the extent that they are
willing and able to organize themselves into various activity groups or committees.
D. Grievance Procedures. Written and signed grievances are first taken to the on-site manager. A
copy of the grievance is also to be sent to the Regional Property Manager. If the grievance is
not resolved with the on-site manager, residents are to then contact the Regional Property
Manager.
Regional Property manager will only respond to grievances which:
1. Have been signed by the resident(s).
2. Have been discussed first with the on-site manager.
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Page 9
Regional Property managers will then work with the parties involved to determine the "facts"
and arrive of a decision which will be binding.
Grievances will not be considered by management if they are contrary to established House
Rules, the Resident's Lease, or the Resident Handbook.
13. COMMUNITY RELATIONS
DMS makes every effort to maintain a good relationship with local police departments. This
includes the officers who service the area the development is in or any City appointed liaison. In
the event management recognizes a problem with the police calls to the development, a 911 call list
will be requested to identify the nature of the calls. An analysis of the call list will separate the type
of calls into serious and nonserious or aid and assist categories. When lease violations and problem
residents are identified, appropriate measures will be taken to correct he violations or terminate
their lease.
DMS encourages a "Good Neighbor" policy realizing that periodically adjoining property owners
may realize a problem from a multifamily community. Our managers are instructed to thoroughly
investigate any complaint from our neighbors. All parties will then work together to determine the
facts and work towards an mutually beneficial solution.
A representative of DMS will work with the City, County and School personnel to develop
recreational and educational programs for the residents on-site. We will also provide information to
the residents of such programs and all resources available to them within the community.
.i
14. EXAMINATION OF LEASES AND EVICTIONS
A. The on-site manager and supervisors are responsible for knowing State and local laws
regarding termination of leases and eviction.
B. The on-site manager and supervisor are responsible for knowing State and local laws
regarding notification given to•the residents prior the termination of their lease or if an eviction
is proposed.
C: Under State law, illegal substances, including drugs, constitutes unlawful possession of the
apartment by that resident. The Owner or his Agent is required by State law to start or
authorize an eviction action against the resident within fifteen(15) days of notice of the
seizure.
15. MANAGEMENT TRAINING
A. DMS encourages professional growth for all employees. Dominium highly recommends
education to help improve all job performances.
•
Page 10
B. DMS holds an annual training seminar for all employees. Training is performed by regional
property managers and outside sources related to the property management industry.
C7
•
MANAGEMENT BACKGROUND AND/OR EXPERIENCE
DMS was established in January of 1980. Currently DMS manages approximately 5,000 units of
multifamily.residential housing primarily in the states of Minnesota, Wisconsin, South Carolina and
Florida.
The Owners of Richfield Housing Associates Limited Partnership and DMS hereby agree to this
Management Plan.
RICHFIELD HOUSING ASSOCIATES DOMINIUM MANAGEMENT
LIMITED PARTNERSHIP SERVICES, INC.
By _
Title:
Date:
By: _
Title:
Date:
Page 11
ADDENDUM A
CENTURY COURT -RICHFIELD
GENERAL LEASING POLICIES
Maximum Number of Occupants Per Unit: 2 Occupants to a 1 Bedroom Unit
Upon receipt of the following:
1. - A completed rental application.
2. A $30 application fee (non-refundable)
3. Security deposit.
The site staff will screen the applicant using the following procedures:
1. Contacting previous and present landlord.
2. Run credit check through Landlord Protection Agency or Rent. Grow Credit Service.
3. Run Unlawful Detainer (eviction) check through Landlord protection Agency. (Approx. 5
year history.)
4. Run criminal record check through Landlord Protection Agency. (Approx. 5 year history.)
Initially Country records will be checked, if unavailable a statewide BCA check could be
run. County checks identify charges and conviction, Statewide BCA identifies convictions
only.
5. Verify current employment and references.
The following factors are considered in selecting a resident:
1. Demonstrated ability to pay rent and utilities on time;
2. Comments from the former landlords (endorsement from at least two is preferred);
1 Credit references. Credit checks may be useful when no rent payment history is available.
However, lack of a credit history, as opposed to a poor credit history, is not sufficient
justification to reject an applicant;
4. Drug related activity and/or criminal history record.
APPLICANT IS NOT ACCEPTED UNTIL APPROVED BY THE PROPERTY MANAGER
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REJECTING APPLICANTS
Denial of a housing offer may occur due to, but is not limited to the following:
1. A rating of R-3 or higher on credit report (exclusive of verifiable extenuating circumstances). A
higher security deposit may be required if rating from credit service indicates problems were in the
past and current obligations have been met.
2. An applicant's inability to fulfill obligations and comply with all terms of the previous/current
Lease/Rental Agreement, or
3. A record of chronic late, underpayment or nonpayment of rightful obligations, including rent and
utilities, or
A record of disruptive behavior, or
A record of destruction of property, or
A record of poor living or housekeeping habits, or
A history of criminal activity involving crimes of physical violence to persons or property, or a
record of other criminal acts which may endanger the health, safety or welfare of other residents, or
Eviction for material non-compliance, or "other good cause," from current or previous housing, or
9. A history of activities that would be injurious to the reputation of the property and/or be likely to
cause an increase in the rate of hazard insurance on the property, or
10. Purposeful falsification or withholding of information or submission of inaccurate and/or
incomplete information on any application or during the interview.
•
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Page 13
ADDENDUM B
I. MARKETING PROCEDURES
A. Building
1. Physical Characteristics
Becoming familiar with the physical characteristics of the apartment community is the
first priority. A "Fact Sheet" is prepared at each site that has important information
summarized such as unit mix, laundry areas, amenities, lease terms and clauses, and
deposits and fees.
2. Construction Details
Become acquainted with construction details as they relate to energy efficiency,
soundproofing, safety , security systems, etc.
B. Units
1. General Information
An information book will be in the On-site Office for reference. This will have
information on the appliances, heating and cooling equipment, standards sized of
windows, room sizes, etc.
2. Availability List
a. The information placed on this list will be a listing of all vacant units and units on
a 30/60 day notice to vacate.
b. For each unit, indicate the size, style, square footage, price and condition.
c. It is the responsibility of each agent to maintain a current Availability List. This
form should be updated daily with any/all changes.
C. Resident Profile
1. General knowledge of your apartment community's demographics will be
important to the prospective resident. Everyone likes to know what type of people
they will be living lose to; this becomes especially true to people who are moving
here from. another community..
D. Neighborhood
Proximity to schools, churches, synagogues, grocery stores, banks, daycare, parks,
hospitals and clinics, shopping centers, etc. Should be available to prospective
residents. Knowledge of the community will be especially important to transferees
or people moving here from outside of the area.
It is imperative that agents are able to give directions to the property from all parts
of the metropolitan area.
E. Competition
Evaluate Your Community
Walk the building and grounds and complete a Shopping Report of your
community.
Page 14
2. Other Communities
a. Both a community and its regional office need information about the
surrounding communities that are indirect competition. For this reason, three
forms have been designed to provide a standard method of documenting this
information.
b. "Shop" other communities using our Shopping Report as means of
familiarizing yourself with our competition.
c. The Competitive Community Information Sheet provides a detailed
description of the physical appearance, facilities, and leasing policies at a
competing community. This sheet is filled out when a competing community
is first surveyed, and a copy is sent to the regional office.
d. Use the Competitive Survey Report to compare our community with
competing communities.
F. Forms
11
The on-site office staff must be totally knowledgeable of the following DMS forms:
1. Application for Lease
2. Employment Verification
3. Credit Statement of Denial
4. Lease
5. Build or Buy Clause
6. Employment Transfer Clause
7. Pet Addendum
8. Washer/Dryer Lease
9. Security Deposit Addendum
10. Garage Rental Agreement
11. Lease Information Update
12. Daily Traffic Report
13. Weekly Traffic Report.
14. Weekly Follow-up Report
.
15. Telephone Guide
16. Fact Sheet
17. Availability Sheet
18. Welcome Card
19. Lease Checklist
20. Shopping Report
21. Competitive Community Information sheet
22. Competitive Survey Report
NOTE: Any request by an applicant for special term arrangements MUST be
approved by the On-site Manager.
Page 15
II. THE SELL
A. Advertising
1. Objectives are as follows:
a. The primary objective of advertising is to make the telephone ring and/or bring
prospects to the site.
b. Advertising must be monitored on a daily basis by asking the prospective resident,
either on the telephone or in person, what source lead them to inquire about
residency at your community. This activity is monitored by the use of the Daily
Traffic Report.
c. The leasing agent must be aware every day as to the types of specials, discounts,
and special term/arrangement that are being advertised.
d. Projecting the needs for advertisement can be best forecasted through the
Availability Report.
2. Tracking
a. All ads must be clipped on a daily basis by the on-site leasing staff and placed in
the ad book provided. This book can be used by the leasing agents to familiarize
themselves with the publications or sources being utilized.
b. Weekly Traffic Reports are records of all phone calls, showings, and applications.
The information for this report can be compiled from both the Welcome Card and
the Daily Traffic Report. This report is to be recorded weekly in a Sunday through
Saturday time period.
B. Telephone Calls
1. Dominium Greeting
Since you re the first contact with DMS that any prospective resident may have, it is of
greatest importance that what you say and how you say it presents a positive image to the
caller.
-2. Setting An appointment - The Objective
a. A leasing agent' first priority is to covert every telephone inquiry possible into a scheduled
appointment. If you schedule an appointment, get a name (first and last) and a telephone
number. This is the first step in the "closing" process because it is a commitment of time
from the prospective resident.
b. If you cannot schedule an appointment, ask for a name (first and last) and address for the
purpose of sending out information. Be sure that you mail out this information on the same
day! This name and address is also a lead for you to follow up on. A telephone call without
a lead is advertising dollars "down the drain."
C. The Appointment
1. The Greeting
•
Page 16
The initial greeting can set the tone for the presentation-so be ready when the
prospective resident arrives.
The following steps can be used for your sequence of actions for the initial meeting:
a. Stand up to greet the prospect. Smile and shake hands.
b. Introduce yourself. Use your first and last name.
c. Ask. for the prospect(s) to repeat their names.
d. Invite them to sit down.
e. . Offer the prospect(s) coffee or soft drinks
f. Have the prospect(s) fill out a Welcome Card if one has not already been filled out.
g. Have a positive approach and the prospect(s) will also be positive!
2. Welcome Cards
a. These cards help identify where the prospect came from and how they heard about
your community. More importantly, this guest registration card will quickly help
you identify the needs of the prospect.
b. The front of the Welcome Card should be filled out by the prospect; the back
should be filled out by you, the leasing agent. Use the back side to make motes and
record mailings any other follow up information phone calls.
3. The interview
The following items should be included in all presentations:
a. Use the prospect(s) name (via the introduction and Welcome Card) whenever
possible.
b. Ask additional probing questions to determine the needs of the prospect. Examples
of possible questions are as follows:
1. How many people will live in the apartment?
2. How much furniture do you have?
3. What is important.to you in an apartment?
4. Do you have a preferred floor plan?
c. Review the site/community plan and any appropriate floor plans, renderings and
photos before showing the apartments.
4. Showing the Apartment/Unit
a. If there is a recreational amenity package, it is wise to show that area first to immediately
establish "value" in the prospect's mind.
b. Always show only clean apartments, and limit the number of units shown to three (3). More
than three are confusing.
c. It is important to accompany the prospect tot he unit. It is otherwise impossible to pick up
buying signals or overcome objections. Listen to what the prospect says, but remain in control
of the presentation.
Page 17
D. Encourage the prospect to open closets, cupboards, etc.
E. If residents are allowed to do any decorating/redecorating, mention that fact (i.e., wallpaper,
etc.)
F. Personalize the presentation by using feature/benefit selling. Be a salesperson-not a tour
guide. Get the prospect involved! Examples of information you can present are as follows:
1. Since some units have bedrooms of equal size, this may be more ideal for roommates.
2. Having a washer/dryer in your own apartment is so much more convenient.
3. Having a microwave in the apartment opens up counter space and is a definite convenience
appliance.
G. Always end up back at the office with time to summarize and close.
5. The Closing
While showing the apartment, get in the habit of making at least five closing attempts during the
presentation. Trial closing statement will narrow the selections. Closing questions or statement ask
for a decision ...a COMMITMENT!
Examples of statements and questions that can be developed to encourage your applicant to make a
decision are as follows:
A. Let's go back to the office and start the paper work.
B. When do you want to move in?
C. When is it more convenient for you to move in-the weekend or a weekday?
D. Let's go back to the office and meet the On-site Manager.
E. What one thing would make you rent today?
F. How do you want your name(s) to appear on the mailbox?
G. When do you want your newspaper service started?
6. Twenty-Four Hour Hold
A. Fifty Dollar ($50) Refundable Deposit
1. A $50 refundable deposit is necessary to "hold" the apartment off the market for 24 hours.
2. If a 24 hour hold is placed by the applicant, collect the $50 deposit and write up a receipt
using the Cash Receipts and Adjustments form, but do not deposit. Put the apartment they
re interested in on a temporary "hold."
B. Follow Through
1. On the following day, if the prospect tells you that they do want to lease the apartment,
make arrangement for them to come back to fill out the Application for Lease and pay the
application fee/security deposit. At this time you will return the $50 check.
2. Should the prospect decide against the apartment, write "VOID" across the check and mail
it back to the prospect.
3. It is the leasing agent's responsibility to call the client back the following day.
•
Page 18
4. If the agent that received the $50 is not on duty the next day, be sure to notify another
agent to follow through on the lead or 24 hour hold deposit.
D. The Follow Up Process
1. All visitors that do not rent are to be contacted by telephone one day after the visit-unless
otherwise requested by the prospect.
2. A Thank You card is to be mailed in addition to, but not instead of, the telephone call.
3. If the prospect is looking at leasing two to three months in the future, update your Welcome
Card and make telephone calls on a regular basis. A. "tickler" file is. a constant reminder. If a
prospect is looking for March 1 st occupancy, make your phone call not later than the middle
of January.
4. Verify that all qualified prospects who visited the community during the week received a
follow-up phone call and note by completing the Weekly Follow-Up Report.
•
•
Page 19
ADDENDUM C •
CENTURY COURT - RICHFIELD
Staffing Breakdown
Administration
• Site Manager
• Assistant Manager
• Administrative Assistant
• 2 Full-time Leasing Agents
• 2 Part-time Leasing Agents
•
Maintenance
• Maintenance Supervisor
• Maintenance Supervisor Assistant
• 5 Technicians .
• . Carpenter
• 2 Painters
• 3 Groundskeepers
• 9 Caretakers
•
Page 20
•
CITY OF RICHFIELD, MINNESOTA
ISSUER
AND
FIRST TRUST NATIONAL ASSOCIATION
TRUSTEE
•
INDENTURE OF TRUST
Dated as of April 1, 1995
$19,679,000
MULTIFAMILY HOUSING REVENUE BONDS
(CENTURY COURT APARTMENTS PROJECT)
SERIES 1995
•
This instrument was drafted by:
HOLMES & GRAVEN, CHARTERED
470 Pillsbury Center
Minneapolis, Minnesota 55402
BLPS4953
RC125-94
Indenture of Trust
First Draft - March 20, 1995
•
0
E
TABLE OF CONTENTS
PAGE
PREAMBLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
GRANTING CLAUSES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE ONE
Definitions, Exhibits and. General Provisions
Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1.02. Rules of Interpretation . . . . . . . . . . . . . . . . . . 12
ARTICLE TWO
The Bonds
Section 2.01. Authorized Amount and Form of Bonds . . . . . . . . . . . 14
Section 2.02. Initial Issue . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 2.03. Variable Rate . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 2.04. Execution . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 2.05. Authentication . . . . . . . . . . . . . . . . . . 25
Section 2.06. Delivery of Initial Issue . . . . . . . . . . . . . . 25
Section 2.07. Mutilated, Lost, Stolen, Destroyed or
Untendered Bonds . . . . . . . . . . . . . . . . . . 26
Section 2.08. Ownership of Bonds . . . . . . . . . . . . . . . . . 26
Section 2.09. Preparation of Definitive Bonds; Temporary
Bonds . . . . . . . . . . . . . . . . . . . . . .
. . 27
Section 2.10. Registration, Transfer and Exchange of
Bonds . . . . . . . . . . . . . . . . . . . . . . . 27
Section 2.11. Interest Rights Preserved . . . . . . . . . . . . . . . . . 28
Section 2.12. Cancellation of Bonds . . . . . . . . . . . . . . . . . . . . 28
Section 2.13. Fixed Rate . . . . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE THREE
Redemption of Bonds Before Maturity
Section 3.01. Redemption Provisions . . . . . . . . . . . . . . . . . . 32
Section 3.02. Partial Redemption of Bonds . . . . . . . . . . . . . . . . . 34
Section 3.03.. Procedure for Redemption . . . . . . . . . . . . . . . . . . 34
Section 3.04. Payment of Bonds Upon Redemption . . . . . . . . . . . . 34
Section 3.05. No Partial Redemption After Default . . . . . . . . . . . . 34
Section 3.06. Cancellation ... . . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE FOUR
Purchase and Remarketing of Bonds
Section 4.01. Optional Tender of Bonds at Option of
Holder . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 4.02. Mandatory Tender of Bonds . . . . . . . . . . . . . . . . . 36
Section 4.03. Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . 37
Section 4.04. Remarketing of Bonds . . . . . . . . . . . . . . . . . . . . 37
Section 4.05. Purchase of Tendered Bonds . . . . . . . . . . . . . . . . . 38
Section 4.06. Intentionally Omitted • • 38
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Section 4.07. Purchase Not to Constitute a Redemption . . . . . . . . . 38
Section 4.08. Untendered Bonds . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE FIVE
General Covenants
Section 5.01. Payment of Principal, Premium and Interest . . . . . . . . 39
Section 5.02. Performance of and Trustee for Covenants . . . . 39
Section 5.03. Instruments of Further Assurance. . . . . . . . . . . . . . 39
Section 5.04. Recording and Filing . . . . . . . . . . . ... . . . . . . . . 39
Section 5.05. Books and Records . . . . . . . . . ... . . . . 39
Section 5.06. Bondholders' Access to Bond Register . . . . . . . . . . . 39
Section 5.07. Rights Under Loan Agreement . . . . . . . . . . . . . . . 40
ARTICLE SIX
Funds and Accounts
Section 6.01. "Trust Moneys" Defined . . . . . . . . . . . . . . . . . . 41
Section 6.02. Project Fund . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 6.03. Bond Fund . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 6.04. Bond Purchase Fund . . . . . . . . ... . . . . . . . . . 43
Section 6.05. Excess Investment Earnings Fund . . . . . . . . . . . . . 44
Section 6.06. Reserve Fund . . . . . . . . . . . . . . . . . . . . . 44
Section 6.07. Deposit of Funds with Paying Agent . . . . . . . . . . 44
ARTICLE SEVEN
Intentionally Omitted
ARTICLE EIGHT
Investments
Section 8.01. Investments by Trustee . . . . . . . . . . . . . . . . . . . 47
Section 8.02. Return on Investments . . . . . . . . . . . . . . . . . . . . 47
Section 8.03. Computation of Balances in Fund . . . . . . . . . . . . . . 48
Section 8.04. Rebate to United States . . . . . . . . . . . . . . . . . . . 49
ARTICLE NINE
Discharge of Lien
Section 9.01. Payment of Bonds; Satisfaction and
Discharge of Bonds and obligation to
Bondholders . . . . . . . . . . . . . . . . . . . . . 50
Section 9.02. Discharge of the Indenture . . . . . . . . . . . . . . . . 51
Section 9.03. Tax Call . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
ARTICLE TEN
Default Provisions and Remedies
Section 10.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . 52
Section 10.02. Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 10.03. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 10.04. Direction of Proceedings By Bondholders . . . . . . . . 53
Section 10.05. Waiver of Stay or Extension Laws . . . . . . . . . . 53
BLP84953 Indenture of Trust
RC125-94 11 First Draft - March 20, 1995
•
•
•
Section 10. 06. Priority of Payment and Application of
Moneys 54
Section 10.07. Remedies Vested in Trustee 55
Section 10.08. Rights and Remedies of Holders . . . . . . . . . . . . . 55
Section 10.09. Termination of Proceedings . . . . . . . . . . . . . . . . . 56
Section 10.10. Waiver of an Event of Default . . . . . . . . . . . . . . 56
Section 10.11. : Company as Agent of Issuer . . . . . . . . . . . . . . . . . 56
ARTICLE ELEVEN
The Trustee
Section 11.01. Acceptance of the Trustee . . . . . . . . . . . . . . . . . . 57
Section 11.02. Trustee's Fees, Charges and Expenses . . . . . . . . 59
Section 11.03. Notice to Holders of Default . . . . . . . . . . . . . . . 60
Section 11.04. Intervention by Trustee . . . . . . . . . . . . . . . . . . . 60
Section 11.05. Successor Trustee . . . . . . . . . . . . . . . . . . . . . . 60
Section 11.06. Resignation by Trustee . . . . . . . . . . . . . . . . . . . 60
Section 11.07. Removal of Trustee . . . . . . . . . . . . . . . . . 60
Section 11.08. Appointment of Successor Trustee . . . . . . . . . . . . . 60
Section 11.09. Acceptance by Successor Trustees . . . . . . . . . . . . . 61
Section 11.10. Right of Trustee to Pay Taxes and other
Charges . . . . . . . . . . . . . . . . . . 61
Section 11.11. Trustee Protected in Relying Upon
Resolutions . . . . . . . . . . . . . . . . . . . . 62
Section 11.12. Successor Trustee as Custodian of Bond
Fund and Paying Agent . . . . . . . . . . . . . . . . 62
Section 11.13. Co-Trustee . . . . . . . . . . . . . . .
. . : : : : . : : : 62
Section 11.14. :
Obligation to Trustee as to Reporting 64
Section 11.15. Successor Paying Agent . . . . . . . . . . . . . . . . . . . 64
Section 11.16. Confirmation of the Trustee . . . . . . . . . . . . . . . . . 64
Section 11.17. Remarketing Agent . . . . . . . . . . . . . . . . . . . . . 65
Section 11.18. Qualifications of Remarketing Agent;
Resignation; Removal . . . . . . . . . . . . . . . . . 65
ARTICLE TWELVE
Supplemental Indentures
Section 12.01. Supplemental Indentures Not Requiring
Consent of Bondholders . . . . . . . . . . . . . . . 67
Section 12.02. Supplemental Indentures Requiring Consent
of Holders . . . . . . . . . . . . . . . . . . . . . 67
Section 12.03. Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . 68
ARTICLE THIRTEEN
Amendments to Agreement and Related Documents
Section 13.01. Amendments Not Requiring Bondholder
Consent . . . . . . . . . . . . . . . . . . . . . . 69
Section 13.02. Amendments Requiring Bondholder Consent . . . . . . . . 69
•
BLPS4953 Indenture of Trust
RC125-94 ill First Draft - March 20, 1995
ARTICLE FOURTEEN
Miscellaneous Provisions
Section 14.01. Consent of Holders . . . . . . . . . . . . . . . . . . . . . 71
Section 14.02. Rights Under Indenture . . . . . . . . . . . . . . . . . . . 71
Section 14.03. Meetings of Bondholders . . . . . . . . . . . . . . . . . . . 71
Section 14.04. ' Severability . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 14.05. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 14.06. Required Approvals . . . . . . . . . . . . . . . . . . . . . 74
Section 14.07. Counterparts . . . . . . . . 75
Section 14.08. Limitation of Liability of issuer and its
Officers, Employees and Agents . . . . . . . . . . 75
Section 14.09. Amounts Remaining in Funds . . . . . . . . . . . . . . . . 75
TESTIMONIUM
SIGNATURES
EXHIBIT A Notice of Mandatory Tender Date
s
BLP84953 Indenture of Trust
RC125-94 iv First Draft - March 20, 1995
0 INDENTURE OF TRUST
THIS INDENTURE OF TRUST (the "Indenture") dated as of April 1, 1995, by
and between the City of Richfield, Minnesota, a Minnesota municipal corporation (the
"Issuer"), and First Trust National Association, a national banking association,
authorized to accept and execute trusts of the character herein set out, with its
principal office in St Paul, Minnesota (the "Trustee") :
WITNESSETH :
WHEREAS:
1. The Issuer is authorized by Minnesota Statutes, Chapter 462C, as
amended (the "Act"), to issue rental housing revenue bonds to finance or refinance
in whole or in part the cost of a "Project" (as hereinafter defined) for the public
purposes expressed in the Act; and
2. The Issuer has made the necessary arrangements with ,
a Minnesota limited partnership ( the , "Company"), for the acquisition and
rehabilitation of an existing residential rental project (the "Project"), which will be
of the character and accomplish the purposes provided by the Act, and the Issuer
has entered into a revenue agreement with the Company (in the form of the Loan
Agreement as hereinafter defined) which specifies the terms and conditions of said
acquisition and improvement and provides for the Issuer to finance a portion of the
costs of the Project by making a loan (the "Loan") to the Company to be funded
through the issuance of Multifamily Housing Revenue Bonds . (Century Court
Apartments Project) Series 1995, in the aggregate principal amount of $19,679,000
(the "Bonds"); and
3. As security for the payment of the Bonds, the Issuer has agreed to
assign and pledge to the Trustee, among other things, all right, title and interest
of the Issuer in and to the Loan Agreement (except certain rights reserved to the
Issuer under the terms of this Indenture), including the Basic Payments (as
hereinafter defined); and
4. In connection. with the issuance of the Bonds, the company will enter
into a Regulatory'Agreement dated as of April 1, 1995, with the Issuer and Trustee
(the "Regulatory Agreement") relating to compliance with certain federal, state and
local requirements applicable to the Project.
5. All things necessary to make the Bonds, when authenticated by the
Trustee and issued as in this Indenture provided, valid, binding and legal limited
obligations of the Issuer according to the import thereof, and to constitute this
Indenture a valid contract for the security of the Bonds, have been done and
performed; and the creation, execution and delivery of this Indenture, and the
creation, execution and issuance of said Bonds, subject to the terms hereof, have
in all respects been duly authorized;
1?
BLPS4953 Indenture of Trust
RC125-94 i First Draft - March 20, 1995
NOW THEREFORE, KNOW ALL PERSONS BY THESE PRESENTS, THIS
INDENTURE WITNESSETH:
The Issuer, in consideration of the premises and the acceptance by the
Trustee of the trusts hereby created and of the purchase and acceptance of the
Bonds by the Holders (as herein defined) thereof, in order to secure the payment
of the principal of and interest and premium, if any, on the Bonds according to their
tenor and effect and the performance and observance by the Issuer of all the
covenants expressed or implied herein and in the Bonds, does hereby grant, grant
a security interest in, .assign, transfer in trust, and pledge to the Trustee, and to
its successors in trust, and to them and their assigns forever, the following:
FIRST
All rights, title, interest and privileges of the Issuer in, to and under the
Loan Agreement, including, but not limited to, all sums which the Issuer is entitled
to receive from the Company pursuant to the Loan Agreement and n particular the
Basic Payments (but excluding the rights of the Issuer to indemnification and certain
direct payments to be made to it pursuant to Sections 4.04, 7.04 and 9.05 of the Loan
Agreement), and all other sums (including Bond proceeds) which are required to be
deposited in the trust accounts in accordance with Article Six hereof, except for the
Bond Purchase Fund and Excess Investment Earnings Fund which are not a part of
the Trust Estate; and the earnings derived from the investment of any of the
foregoing sums as provided herein; and
SECOND
Any and all other property of every name and nature which may from time to .
time hereafter by delivery or by writing of any kind be subjected to the lien .hereof
by the Issuer or by anyone in its behalf or with its written consent, including, but
not limited to, the interests of the Issuer, if any, under the Collateral Documents,
and the Trustee is hereby authorized to receive any and all such property at any
and all times and to hold and apply the same as additional security hereunder subject
to the terms hereof ; and
. TO HAVE-AND TO HOLD all the same (herein called the "Trust Estate") with
all privileges and appurtenances hereby granted and assigned, or agreed or
intended so to be, to the Trustee and its. successors in trust and to them and their
assigns forever;
SUBJECT TO the rights of the Company under the Loan Agreement;
IN TRUST NEVERTHELESS, upon the terms and trusts herein set forth for the
equal and proportionate benefit, security and protection of all Holders from time to
time of the Bonds issued under and secured by this Indenture, without privilege,
priority or distinction as to lien or otherwise of any of the Bonds over any of the
others except as otherwise provided herein;
PROVIDED, HOWEVER, that if the Issuer, its successors or assigns, shall well
and truly pay, or cause to be paid, or provide fully for payment as herein provided
of the principal of the Bonds and the interest due or to become due thereon
(together with premium, if any), at the time and in the manner set forth in the
Bonds according to the true intent and meaning thereof, and shall make the
payments into the Bond Fund as required under Article Six or shall provide, as
BLP84953 Indenture of Trust
RC125-94 2 First Draft - March 20, 1995
permitted hereby, for the payment thereof by depositing with the Trustee sums
sufficient for payment of the entire amount due or to become due thereon as herein
provided, and shall well and truly keep, perform ane observe all the covenants and
conditions pursuant to the terms of this Indenture to be kept, performed and
observed by it, and shall pay to the Trustee all sums of money due or to become due
to it in accordance with the terms and provisions hereof, then this Indenture and the
rights hereby : granted shall cease, terminate and be void except as otherwise
provided herein; otherwise, this Indenture shall be and remain in full force and
effect.
UNDER THE PROVISIONS OF THE ACT the Bonds may not be payable from or
be a, charge .upon any funds of the Issuer other than the revenue pledged to the
payment thereof nor shall the Issuer be subject to any pecuniary liability thereon
and no Holder or Holders of the Bonds shall ever have the right to compel any
exercise of the taxing power of the Issuer to pay any Bonds or the interest and
premium, if any, thereon, or to enforce payment thereof against any property of the
Issuer, except as above provided; the Bonds shall not constitute a charge, lien or
encumbrance, legal or equitable, upon any property of the Issuer, except as above
provided; and no Bond shall constitute a debt of the Issuer within the meaning of
any constitutional or statutory limitation, but nothing in the Act impairs the rights
of Holders of Bonds issued under this Indenture to enforce the covenants made for
the security thereof as provided in this Indenture and in the Act, and by authority
of the Act the Issuer and the Trustee mutually covenant and agree, to the extent
specifically provided herein, for the equal and proportionate benefit of all Holders
of the Bonds, as follows:
•
BLP84953 Indenture of Trust
RC125-94 3 First Draft - March 20, 1995
ARTICLE ONE
Definitions, Exhibits and Genera! Provisions
Section 1.01. Definitions. In this Indenture the following terms have the
following meanings unless the context hereof clearly requires otherwise, and any
other terms defined in the Loan Agreement shall have the same meanings when used
herein as assigned them in. the Loan Agreement unless the context or use thereof
indicates another or different meaning or intent :
Act: Minnesota Statutes, Chapter 462C, as amended;
Act of Bankruptcy: any of the following events:
(1) If the Company shall (a) apply for or consent to the appointment
of, or the taking of possession by, a receiver, custodian, trustee, liquidator
or the like, or of all or a substantial part of their property, (b) commence a
voluntary case under the Federal Bankruptcy Code (as now or hereafter in
effect), or (c) file a petition seeking to take advantage of any other law
relating to bankruptcy, insolvency, reorganization, winding-up or
composition or adjustment of debts; or
r?
?J
(ii) A proceeding or case shall be commenced, without the application
or consent of the Company, in any court of competent jurisdiction, seeking
(a) the liquidation, reorganization, dissolution, winding-up, or the
composition or adjustment of its debts, (b) the appointment of a trustee,
receiver, custodian, liquidator or the like of the Company, or of all or any
substantial part of its assets, or (c) similar relief in respect of the Company
under any law relating to bankruptcy, insolvency, reorganization,
winding-up or composition or adjustment of debts;
Additional Charges : the payments required by Section 4.04 of the Loan
Agreement;
Affiliated. Party: as to a particular Person, any Person directly and,
indirectly controlling, or controlled by or under direct or indirect common control
with such specified Person. "Control", when used with respect to a particular
Person, means the possession, directly or indirectly, of the power to direct
management and policies of such Person whether through the ownership of voting
stock, by contract or otherwise, and the terms "controlling" and "controlled" have
meanings correlative to the foregoing;
Authorized Denominations : $100,000 or any multiple of $5,000 in excess of
$5,000;
Basic Payments or Loan Payments : the payments required by Section 4.02 and
Section 4.03 of the Loan Agreement;
Bond Closing: the date on which there is delivery by the Issuer of, and
payment for, the Bonds;
•
BLPS4953 Indenture of Trust
RC125-94 4 First Draft - March 20, 1995
Bond Counsel: any firm of nationally recognized bond counsel experienced in
tax exempt bond financing selected by the Trustee and acceptable to the Issuer, and
the Company;
Bond Fund: the fund so designated in Section 6.03 from which the principal
of and interest on the Bonds are payable;
Bond Purchase Fund: the fund -so designated in Section 6.04; .
Bond Register: the register maintained by the Trustee pursuant to Section
2.10;
Bondholder or Holder or Bondowner: a Person in whose name a Bond is
registered in the Bond Register;
Bonds: the $19,679,000 Multifamily Housing Revenue Bonds (Century Court
Apartments Project) Series 1995 to be issued pursuant hereto;
Bond Year: any twelve (12) month period ending on the anniversary of the
Bond Closing;
Business Day: any day on which the Trustee, the Investment Agreement
Provider or the 'Federal Reserve Bank of New York are not authorized by law to
close ;
City or Issuer: the City of Richfield, Minnesota;
Code or Internal Revenue Code: the Internal Revenue Code of 1986, as
amended, and all applicable Treasury Regulations;
Collateral Documents : any written instrument other than the Loan Agreement
and this Indenture whereby any property or interest in property of any kind is
granted, pledged, conveyed; assigned, or transferred to the Issuer or Trustee, or
both, as security for payment of the Bonds or performance by the Company of its
obligations under the Loan Agreement;
Company.: , a Minnesota limited partnership,
its successors and assigns or other Person which may assume its obligations under
the Loan Agreement;
Condemnation: the word "Condemnation" or phrase "eminent domain" as used
herein shall include the taking or requisition by governmental authority or by a
Person, acting under governmental authority and a conveyance made under threat
of Condemnation, provided such conveyance is made with the approval of the Bank,
which approval shall not be unreasonably withheld, and "Condemnation award" shall
mean payment for property condemned or conveyed under threat of Condemnation;
Conversion Date: any Business Day, which day shall be no earlier than
1, 1995 nor later than 1, 199_, unless such date
is extended in accordance with Section 2.13(a) hereof, as of which the interest rate
on the Bonds converts from a Variable Rate to a Fixed Rate as such date is
established pursuant to Section 2.13 hereof;
i
ELPS4953 Indenture of Trust
RC125-94 5 First Draft - March 20, 1995
Credit Facility: shall have the meaning assigned to such term in the Loan
Agreement;
Date of Taxability: the date as of which the interest on the Bonds is deemed
taxable under a Determination of Taxability;
Defaulted Interest: shall have the meaning stated in Section 2.02 hereof;
Determination of Taxability: a determination that the interest income on any
Bond is includable in gross income for federal income tax purposes under Section 103
of the Code for any reason, other than that the Holder is a Substantial User of the
Project or a Related Person thereto, which determination shall be deemed to have
been made upon the occurrence of the first to occur of the following:
(i) the date on which the Company determines that the interest
income on any of the Bonds is includable in gross income for federal income tax
purposes; or
(ii) the date on which any change in law or regulation becomes
effective or on which the Internal Revenue Service has issued any private
ruling, technical advice or any other written communication to the effect that
the interest income on any of the Bonds is includable in gross income for
federal income tax purposes; or
(iii) the date on which the Company shall receive notice from the
Trustee in writing that the Trustee has been advised by any Holder that the
Internal Revenue Service has issued a thirty-day letter or other notice which
asserts that the interest on such Bond is includable in gross income for
federal income tax purposes; provided that no Determination of Taxability
shall be. deemed to have occurred as a result of a determination by the
Company pursuant to clause (i) above unless such determination is supported
by a written opinion of counsel satisfactory to the Trustee that the interest
income on the Bonds is includable in gross income for federal income tax
purposes;
Discharge Date: the. date on which all Outstanding Bonds are discharged
under Article Nine;
Event of Default : any of the events set forth in Section 10.01 hereof.
Facility : the existing 1,140-unit rental housing facility located on the Project
Premises, and all related improvements and equipment, together with all additions
to, replacements of and substitutions for any of the foregoing;
Federal Bankruptcy Code: the United States Bankruptcy Reform Act of 1978,
as amended, or any similar or succeeding federal bankruptcy law;
Final Conversion Date:
Final Maturity Date : the Maturity Date, Discharge Date or Redemption Date
on which all outstanding Bonds either mature, are redeemed or discharged,
whichever is earlier;
BLPS4953 Indenture of Trust
RC125-94 6 First Draft - March 20, 1995
•
•
•
Fixed Rate: the interest rate established in accordance with Section 2.13
hereof;
Fixed Rate Period: the period from and including the Conversion Date to and
including the date next preceding the payment in full of the Bonds;
Fixed Rate Interest Payment Date: the first 1 or 1 next
succeeding the Conversion Date, and each 1 and 1 thereafter
until payment in full of the Bonds;
Government Obligations: shall mean direct general obligations of, or.
obligations the prompt payment of the principal of and the interest on which are fully
and unconditionally guaranteed by, the United States of America;
Holder or Bondholder: the Person in whose name a Bond is registered in the
Bond Register;
Indenture : this Indenture of Trust by and between the Issuer and the
Trustee, as the same may from time to time be amended or supplemented as herein
provided;
Independent Accountant: a certified public accountant or firm of certified
public accountants registered and qualified to practice as such under the laws of the
State of Minnesota, who does not have any direct financial interest in the Company,
other than the payment to be received under contract for services performed and
who is not connected with the Company as an officer, employee, underwriter,
partner, affiliate, subsidiary, or person performing similar functions and is not a
trustee or director of the Company;
Independent Counsel: any attorney duly admitted to practice law before the
highest court of any state, who may be counsel to the Company or the Issuer but who
may not be an officer or a full time employee of the Company or the Issuer;
Interest Payment Date: each Fixed Rate Interest Payment Date, each Variable
Rate Interest Payment Date and the Conversion Date;
Interest Period: the period from and including an Interest Payment Date to
and including the day next preceding the next Interest Payment Date, except that
the first Interest Period shall be the period from and including the date of the first
authentication and delivery of the Bonds hereunder to and including ,
1995;
Investment Agreement Provider: ;
Investment Agreement : the Investment Agreement dated April _, 1995
between the Trustee and the Investment Agreement Provider;
Interest Payment Date : the Conversion Date and each Fixed Rate Interest
Payment Date and Variable Rate Interest Payment Date;
Internal Revenue Code or Code: the Internal Revenue Code of 1986, as
amended, and all applicable Treasury Regulations;
E
BLP84953 Indenture of Trust
RC125-94 7 First Draft - March 20, 1995
Loan: the loan of Bond proceeds by the Issuer to the Company described in
Section 4.01 of the Loan Agreement;
Loan Agreement: the Loan Agreement of even date herewith by and between
the Issuer and the Company, as the same may from time to time be amended or
supplemented as provided therein and in this Indenture;
Loan Payments or Basic Payments : the payments the Company is obligated to
make pursuant to Sections 4.02 and 4.03 of the Loan Agreement;
Mandatory Redemption Payments : the payments which are required to-be made
under Section 3.01(b) or (c) to redeem the Bonds in accordance with the Mandatory
Redemption Schedule after appropriate credits, if any, have been made;
Mandatory Redemption Schedule: the mandatory redemption schedule for the
Bonds set forth in Section 3.01(b) or (c);
Mandatory Tender Date: the Conversion Date;
Mandatory Tender Notice : has the meaning assigned to it in Section 4.02(2);
Maturity Date or Maturity: any date on which principal of or interest or
premium, if any, on the Bonds is due, whether at maturity, on a scheduled interest
payment date, or upon redemption, defeasance, acceleration, or otherwise;
Mood 's: Moody's Investors Service, Inc., a corporation organized and
existing under the laws of the State of New York, its successors and assigns, and,
if such corporation shall be dissolved or liquidated or shall no longer perform the
functions of a municipal securities rating agency, "Moody's" shall be deemed to refer
to any other nationally recognized municipal securities rating agency designated by
the Issuer (other than Standard & Poor's Corporation);
Notice by Mail : notice of any action or condition by mail shall mean a written
notice meeting the requirements of this Indenture mailed by first-class mail, postage
prepaid, to the Holders of specified Bonds at the addresses shown in the Bond
Register;
Optional Tender Date: any date on which a Bond is to be purchased pursuant
to Section 4.01;
Optional Tender Notice : shall have the meaning assigned to it in Section
4.010)(A);
Original Purchaser: the first Person(s) who purchase the Bonds from the
Issuer at Bond Closing;
Outstanding Bonds: as of the date of determination, all Bonds theretofore
issued and delivered under this Indenture except:
(1) Bonds theretofore cancelled by the Trustee or Paying Agent or
delivered to the Trustee or Paying Agent cancelled or for cancellation;
(2) Bonds for which payment or redemption moneys or securities (as
provided in Article Nine) shall have been theretofore deposited with the
BLPS4953 Indenture of Trust
RC125-94 8 First Draft - March 20, 1995
Trustee in trust for the Holders of such Bonds; provided, however, that if
such Bonds are to be redeemed, notice of such redemption shall have been
duly given pursuant to this Indenture or irre*: ocable action shall have been
taken to call such Bonds for redemption at a stated Redemption Date; and
(3) Bonds in exchange for or in lieu of which other Bonds shall have
been issued and delivered pursuant to this Indenture, including Untendered
Bonds; provided, however, that in determining whether the Holders of the
requisite principal amount of Outstanding Bonds have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Bonds
owned by the Company shall be disregarded and deemed not to be Outstanding
Bonds, except that in determining whether the Trustee shall be protected in
relying upon any such request, demand, authorization, direction, notice,
consent, or waiver, only Bonds which the Trustee knows to be owned by the
Company shall be disregarded;
Paving Agent: the Trustee or any other entity designated pursuant to this
Indenture as the agent of the Issuer and the Trustee to receive and disburse the
principal of and premium, if any, and interest on the Bonds;
Payment Date: any Interest Payment Date, any Stated Maturity, the
Discharge Date, the Mandatory Tender Date or any Redemption Date;
Permitted Investments :
(1) Government Obligations ;
(2) Shares of an investment company registered under the Federal
Investment Company Act of 1940, whose shares are registered under the
Federal Securities Act of 1933, and whose only investments are obligations
described in clause (1) above;
(3) Any general obligation of the State of Minnesota or any of its
political subdivisions, provided that securities described in clause (1) above
have been irrevocably deposited in escrow to effect discharge of the general
obligations in the same manner and subject to the same conditions required to
effect discharge of the Bonds under. Article Nine;
(4) Certificates of deposit with fixed maturities„ time deposits,
repurchase agreements or any other direct obligation with or of either Bank
or any other national or state bank or federally chartered savings and loan
association whose senior debt obligations are rated A or better by a Rating
Agency or any other bank if the debt obligations for which such bank's letters
of credit are the primary basis are rated A or better by a Rating Agency
which initially rated the Bonds; and
(5) the Investment Agreement.
Person: any natural person, corporat9
venture, cooperative, partnership, trust
government or governmental body or agency,
entity, as in the context may be appropriate;
BLP84953
RC125-94 9
.on, limited liability company, joint
or unincorporated organization,
political subdivision or other legal
indenture of Trust
First Draft - March 20, 1995
. Prime Rate : the rate of interest publicly announced by Morgan Guaranty
Trust Co. in New York, New York, or its successor as its "prime rate" or "reference
rate," which rate shall change when and as such prime rate changes;
Project: the Project Premises, the Facility and the Improvements, including
all Project Equipment, as they may at any time exist;
Project Equipment: any and all (i) fixtures or tangible personal property now
or hereafter attached or affixed to the Project Premises, (ii) other tangible personal
property now or hereafter located within or used in connection with the Project
Premises or the Facility and (iii) any additions to, replacements of and substitutions
for any of the foregoing;
Project Premises : the real estate legally described in Exhibit A attached to the
Loan Agreement, together with all additions to, replacements of and substitutions
for the foregoing;
Rating Agency: Standard & Poor's Ratings Group or Moody's;
Rating Category: one of the generic rating categories of a Rating Agency,
without regard to any. refinement or gradation of such Rating Category by a
numerical or other modifier;
Rebate Amounts : the amount determined pursuant to Section 7.07 (14) of the
Loan Agreement to be rebated to the United States;
Record Date: the 15th day of the calendar month next preceding an Interest
Payment Date, whether or not such day is a Business Day;
Redemption Date: when used with respect to any Bond to be redeemed shall
mean the date on which it is to be redeemed pursuant hereto;
Redemption Price: when used with respect to any Bond to be redeemed shall
mean the price at which it is to be redeemed pursuant hereto;
Regular Interest Payments: all interest payments on the Bonds, other than
Special Interest Payments;.
Regulatory Agreement : the Regulatory Agreement dated as of April 1, 1995,
by and between the Trustee, the Issuer and the Company, as the same may be
amended from time to time;
Related Documents : the Loan Agreement and the Regulatory Agreement;
Related Person: with reference to any Substantial User, means a "related
person" within the meaning of Section 147(a)(2) of the Code;
Remarketing Agent: Piper Jaffray Inc. , or any successor Remarketing Agent
appointed and serving in such capacity pursuant to this Indenture;
Remarketing; Agreement : the Remarketing Agreement, dated as of April 1,
1995, between the Company, the Remarketing Agent, and the Trustee, as the same
may be amended from time to time, and. if a successor Remarketing Agent is appointed.
in accordance with the Indenture, "Remarketing Agreement" shall mean such other
BLP84953 Indenture of Trust
RC125-94 10 First Draft - March 20, 1995
similar agreement between the Company, the Trustee and such successor
Remarketing Agent;
Representative: the City Manager of the Issuer or an authorized
representative of a general partner of the Company, or any other person at any time
designated to act on-behalf of the Issuer or the Company, as the case may be, as
evidenced by a written certificate furnished to the other party and the Trustee
containing the specimen signature of such person and signed for the Issuer by its
City Manager or for the Company by a general partner of the Company;
Resale Proceeds: all proceeds from the remarketing of the Bonds pursuant to
Section 4.04 hereof;
Responsible Agent : any Person duly authorized and designated by the
Trustee to act on its behalf in carrying out the applicable duties and powers of the
Trustee as set forth in this Indenture; (any action required by the Trustee under
this Indenture may be taken by a Responsible Agent);
Restricted Construction Funds: any Bond proceeds, including interest
thereon, which are required to be transferred on the Completion Date from the
Project Fund to the Bond Fund and which the Trustee is required under Section
6.03(2) to apply towards the prepayment or pro rata payment of Bonds;
Restricted Obligations : shall mean either an obligation the interest on which
is includable in gross income for federal income tax purposes under Section 103 of
the Code, or an obligation which is a private activity bond as defined in Section 141
of the Code;
Special Interest Payments: all payments of (or with respect to) interest on the
Bonds made upon the acceleration of the Bonds pursuant to Section 10.02;
Special Record Date : the date fixed by the Trustee pursuant to Section 2.02
hereof relating to the payment of any Defaulted Interest;
Standard & Poor's Ratings Group: Standard & Poor's Ratings Group, a
corporation organized and existing under the laws of the State of New York, its
successors and their assigns, and if such corporation shall be dissolved or liquidated
or shall no longer perform the functions of a municipal securities rating agency"
"Standard & Poor's Ratings Group" shall be deemed to refer to any other nationally
recognized municipal securities rating agency designated by the Issuer (other than
Moody's) ;
Stated Maturity: when used with respect to any Bond or any installment of
interest thereon shall mean the date specified in such Bond as the fixed date on
which principal of such Bond or such installment of interest is due and payable;
Substantial User: a "Substantial User" within the meaning of Section
147(a) (1) of the Code;
Tender Date: shall mean each Optional Tender Date and the Mandatory Tender
Date ;
Tender Price: the principal and accrued interest due on the Bonds on any
Mandatory Tender Date;
BLP84953 Indenture of Trust
RC125-94 1 1 First Draft - March 20, 1995
Trust Estate: the Trust Estate as defined and set forth in the Granting
Clauses hereof;
Trustee: First Trust National Association in St. Paul, Minnesota, and any
co-trustee or successor trustee appointed, qualified and then acting as such under
the provisions of this Indenture;
Underwriter: Piper Jaffray Inc.
Unpaid Bonds: all Outstanding Bonds and any other Bonds which. have
neither matured nor been redeemed or purchased and cancelled under this
Indenture;
Untendered Bond: shall have the meaning set forth in Section 4.08 hereof;
Variable Rates the variable interest rate established in accordance with
Section 2.03 hereof;
Variable Rate Interest Payment Date: shall mean the first Business Day of
, 1995, and the first Business Day of each month thereafter through
the Conversion Date; .
Variable Rate Period: the period during which the Bonds bear interest at a
Variable Rate;
Section 1.02. Rules of Interpretation.
(1) This Indenture shall be interpreted in accordance with and governed
by the laws of the State of Minnesota.
(2) The words "herein" and "hereof" and "hereunder" and words of similar
import, without reference to any particular section or subdivision, refer to this
Indenture as a whole rather than to any particular section or subdivision of this
Indenture.
(3) References in. this Indenture to any particular article, section : or
subdivision: hereof are to the designated article, section or subdivision of this
Indenture as originally executed.
(4) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles; and
all computations provided for herein shall be made in accordance with generally
accepted accounting principles consistently applied and applied on. the same basis as
in prior years.
(5) The Table of Contents and titles of articles and sections herein are for
convenience only and are not a part of this Indenture.
(6) Unless the context hereof clearly requires otherwise, the singular shall
include the plural and vice versa and the masculine shall include the feminine and
vice versa.
(7) Articles, sections, subsections and clauses mentioned by number only .
are those so numbered which are contained in this Indenture.
BLP84953 Indenture of Trust
RC125-94 12 First Draft - March 20, 1995
(8) For purposes of this Indenture and the Loan Agreement, an Act of
Bankruptcy shall be deemed no longer pending if either (a) the petition is dismissed
by order of a court of competent jurisdiction and no Uirther appeal rights exist from
such order or (b) the Company notifies the Trustee that such a dismissal has
occurred.
(9) Any opinion of counsel called for herein shall be a written opinion of
such counsel.
(10) References to the Bonds as "tax-exempt" or to the "tax-exempt status
of the Bonds" are to the exclusion of interest from gross income pursuant to Section
103(a) of the Code, irrespective of such forms of taxation as the alternative minimum
tax or environmental tax or branch profits tax on foreign corporations, as is
consistent with the approach taken in Section 59(i) of the Code.
•
•
B1284953 Indenture of Trust
RC125-94 13 First Draft - March 20, 1995
ARTICLE TWO
The Bonds
Section 2.01. Authorized Amount and Form of Bonds. Bonds secured by this
Indenture shall be issued in fully registered form, without coupons, in any
Authorized Denominations, in substantially the form set forth herein with such
appropriate variations, omissions and insertions as are permitted or required by this
Indenture, and in accordance with the further provisions of this Article Two. The
total principal amount of the Bonds that may be outstanding hereunder is expressly
limited to $19,679,000, unless duplicate Bonds are issued as provided in Section
2.09. Portions of the text of the Bonds may be printed on the back of the Bonds to
permit the printing of Bonds of a size which can be registered by machine. If a
portion of the text of the Bond is to be printed on the back of the Bond, the face of
the Bond shall contain a provision in substantially the following form:
"REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS
BOND WHICH ARE SET FORTH ON THE REVERSE HEREOF, AND SUCH PROVISIONS
SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH HERE."
Additionally, at the request of the Trustee the following notation may appear
at an appropriate location on the Bonds to facilitate registration of the Bonds:
"The following abbreviations, when used in the inscription on the face of this
Bond, shall be construed as though they were written out in full:
TEN COM - as tenants in common
TEN ENT - as tenants by entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UTMA - as custodian for under the
(cust) (minor)
Uniform Transfers to Minors Act.
(state)
Additional abbreviations may also be used though not in the above list."
The Bonds prior to the Conversion Date, together with the Trustee's
Certificate of Authentication, the form of Assignment and the registration
information thereon, shall be in substantially the form set forth hereafter. From and
after the Conversion Date, the for of the Bonds shall have whatever changes are
necessary to reflect the terms of the Bonds from and after the Conversion Date:
•
BLP84953 Indenture of Trust
RC125-94 14 First Draft - March 20, 1995
THIS BOND IS REQUIRED TO BE. TENDERED FOR PURCHASE ON AN
OPTIONAL TENDER DATE UPON TERMS AND CONDITIONS HEREIN DESCRIBED AT
A PRICE EQUAL TO 100% OF THE PRINCIPAL AMOUNT HEREOF PLUS ACCRUED
INTEREST HEREON. THIS BOND IS REQUIRED TO BE TENDERED FOR PURCHASE
ON A MANDATORY TENDER DATE UPON TERMS AND CONDITIONS HEREIN
DESCRIBED AT A PRICE EQUAL TO 100% OF THE PRINCIPAL AMOUNT HEREOF
PLUS ACCRUED INTEREST HEREON. FROM AND AFTER AN OPTIONAL TENDER
DATE ON WHICH THE BOND IS TENDERED AND FROM AND AFTER A MANDATORY
TENDER DATE INTEREST SHALL CEASE TO ACCRUE ON THIS BOND, THIS BOND
SHALL NO LONGER BE DEEMED OUTSTANDING, AND THE HOLDER OF THIS BOND
SHALL THEREAFTER LOOK ONLY TO FUNDS HELD-IN THE BOND PURCHASE FUND
(WHICH IS NOT PART OF THE TRUST ESTATE) FOR PAYMENT OF THE PURCHASE
PRICE OF THIS BOND.
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF RICHFIELD, MINNESOTA
No. R-
MULTIFAMILY HOUSING REVENUE BONDS
(CENTURY COURT APARTMENTS PROJECT)
SERIES 1995
Interest Maturity Date of
Rate Date Original Issue
Variable April _, 1995
REGISTERED
HOLDER:
PRINCIPAL
AMOUNT :
CUSIP
(1) KNOW ALL PERSONS BY THESE PRESENTS that the City of Richfield,
Minnesota, in the County of Hennepin and State of Minnesota (the "Issuer"), for
value received, promises to pay to the registered holder named above, or registered
assigns, but only from the Bond Fund (as defined in the Indenture described
below), and upon presentation and surrender hereof at the principal corporate trust
office of the Trustee named below, the principal sum specified above, on the
maturity date specified above, or, if this Bond is prepayable as stated below, or a
prior date on which it shall have been duly called for redemption, and to pay interest
on said principal sum to the Record Date Holder hereof, as defined below, solely from
the Bond Fund, until the principal sum is paid or discharged, at the rates and on the
dates provided herein, on the basis of a 365-day year and charged for the actual
number of days elapsed.
This Bond shall bear interest from the date of original issue set forth above,
or in the case of transfer or exchange, from the most recent Interest Payment Date
(hereinafter defined) to which interest has been paid or provided for. The "Record
BLPS4953 Indenture of Trust
RC125-94 15 First Draft - March 20, 1995
Date Holder" is the person in whose name this. Bond is registered in the Bond
Register maintained by the Trustee named below or its successor in trust (the
"Registered Holder" or "Holder" hereof) on the fifte=th day of the calendar month
next preceding an Interest Payment Date, whether or not such day is a Business
Day. Interest shall be payable by check or draft mailed to the Registered Holder at
his or her address as it appears on the Bond Register on the Record Date, except
as otherwise provided in the Indenture.
The principal of and interest and. premium, if any, on this Bond are payable
in lawful money of the United States of 'America. Upon notice to the Trustee
accompanied 'by proper wire instructions, any Holder of Bonds in an aggregate
principal amount equal to or greater than $1, 000, 000 may elect to be paid the interest
on such Bonds payable on any Interest Payment Date by Federal Reserve wire
transfer in immediately available funds to any bank in the United States specified by
such Holder.
Interest not timely paid or duly provided for will be paid by check mailed to
the person in whose name this Bond is registered on the Bond Register at the close
of business on a date (the "Special Record Date") fixed by the Trustee, notice of
which is to be mailed to all Bondholders.
(2) This Bond is one of an issue in the aggregate principal amount of
$19,679,.000 (the "Bonds"), all of like nominal date of original issue and tenor,
except as to number and amount, issued in accordance with an Indenture of Trust,
dated as of April 1, 1995 (the "Indenture"), duly executed and delivered by the
Issuer to First Trust National Association in St. Paul, Minnesota (the "Trustee"),
setting forth the terms upon which the Bonds are issued. The Bonds are equally .
and ratably secured and entitled to the protection of the Indenture. The Bonds are
issued for the purpose of financing a rental project within the meaning of Minnesota
Statutes, Chapter 462C (the "Project") owned by .
Minnesota limited partnership (the "Company"). The Company has agreed under a
Loan Agreement dated as of April 1, 1995, between the Issuer and the Company (the
"Loan Agreement") to repay all amounts necessary to repay the Bonds, together with
interest thereon, in amounts and at times sufficient to pay the principal of, premium,
if any, and interest on the Bonds as the same shall become due and payable (the
"Basic Payments"). The Company, the Issuer and the Trustee have entered into a
Regulatory Agreement dated April 1, 1995 (the "Regulatory Agreement") requiring
compliance with certain requirements of federal and state law relating to the
construction and operation of the Project as a residential rental housing project.
Pursuant to the Indenture, the Issuer has assigned and pledged to the Trustee, for
the equal and ratable benefit of the Holders of the Bonds, the Basic Payments due
under the Loan Agreement.
(3) Reference is hereby made to the Loan Agreement, Regulatory
Agreement, and Indenture, including all indentures supplemental thereto, for a
description of the property encumbered and assigned, the provisions, among others,
with respect to the nature and extent of the security, the rights of the Issuer, and
the rights, duties and obligations of the Company, the Trustee, the Bank and the
Holders of the Bonds and the terms upon which the Bonds are issued and secured.
(4) The term "Business Day" shall mean any day on which the Trustee, the
Investment Agreement Provider or the Federal Reserve Bank of New York are not
authorized by law to close. If the date for making any payment or the last date for
performance of any act or the exercising of any right, as provided in this Bond, is
BLPS4953 Indenture of Trust
RC125-94 16 First Draft - March 20, 1995
not a Business Day, such payment may be made or act performed or right exercised
on the next succeeding Business Day.
(5) Prior to the Conversion Date, interest on the Bonds shall be payable on
the first Business Day of 1995, and on the first Business Day of
each month thereafter (each a "Variable Rate Interest Payment Date") . Interest on
the Bonds shall be payable on the Conversion Date. After the Conversion Date,
interest on the Bonds shall be payable on the first day of each and
following the Conversion Date, until payment in full of this Bond and on the date of
payment in full of this Bond (each a "Fixed Rate Interest Payment Date").
(6) Prior to the Conversion Date, this Bond shall bear interest at the
Variable Rate as defined in the Indenture (the "Variable Rate"). on and after the
Conversion Date, this Bond shall bear interest at the Fixed Rate, as defined.in the
Indenture. The interest rate on this Bond shall be converted from the Variable Rate
to the Fixed Rate, on a one-time basis at the option of the Company upon the
conditions set forth in the Indenture. In such case, the Fixed Rate shall be the
interest rate computed in accordance with the Indenture and announced by the
Remarketing Agent, effective on and after the Conversion Date.
(7) Prior to thg Conversion Date, the Holder of this Bond may require the
Trustee to purchase this Bond (in whole but not in part), on a Business Day during
the Variable Rate Period, at a purchase price equal to the principal amount thereof
to be purchased plus accrued interest thereon from the most recent Variable Rate
Interest Payment Date, upon:
(a) giving to the Trustee and the Remarketing Agent notice by written
or printed, telex or other means of written or printed instantaneous
communication delivered to the Trustee at its principal corporate trust office
and the Remarketing Agent at its principal office (the "Optional Tender
Notice"), stating: (1) the principal amount of this Bond and the name of the
holder thereof, and (2) the date on which this Bond is to be purchased (the
"Optional Tender Date".), which date shall be a Business Day on or next prior
to the seventh calendar day next succeeding the date of the giving of the
Optional Tender Notice; and
.(b.) delivery of this Bond (with an appropriate instrument of transfer
executed in blank) to the Trustee by 12:00 o'clock Noon, Minneapolis time, on
the Business Day prior to the Optional Tender Date, and, if tendered prior
to a Variable Rate Interest Payment Date and after the Record Date in respect
thereof, accompanied by a due-bill check in form satisfactory to the Trustee,
for interet due on such Variable Rate Interest Payment Date accruing after the
Optional Tender Date.
On the Optional Tender Date the Trustee shall purchase this Bond from the
Holder hereof using funds available under the Indneture at a purchase price equal
to the principal amount hereof plus accrued interest thereon.
(8) Subject to the provisions of (ii) and (iii) below, the Holder hereof shall
be required to tender this Bond to the Trustee on or before 12:00 o'clock, noon,
Minneapolis time on the Business Day prior to the Mandatory Tender Date, for
purchase on the Mandatory Tender Date at a purchase price equal to the principal
amount hereof plus accrued interest thereon, all as more fully provided herein and
in the Indenture.
BLPS4953 Indenture of Trust
RC125-94 17 First Draft - March 20, 1995
(i) Notice of a Mandatory Tender Date (a "Mandatory Tender
Notice") shall be given by the Trustee, by certified mail, return receipt
requested, to the Holder of this Bond at i.--s address appearing on the
registration books for the Bonds maintained by the Trustee, not less than
thirty days prior to the Mandatory Tender Date. Such Mandatory Tender
Notice shall specify the Mandatory Tender Date and state (a) that all Bonds
shall be purchased on the Mandatory Tender Date at a purchase price equal
to the principal amount thereof plus accrued interest thereon, and (b) that
all Bonds must be tendered for purchase at or before 12:00 o'clock, noon,
Minneapolis time on the Business Day prior to the Mandatory Tender Date,
together with an appropriate instrument of transfer executed in blank and if
tendered prior to an Interest Payment Date and after the Record Date in
respect thereof, accompanied by a due-bill check in form satisfactory to the
Trustee for interest to accrue from and after the Mandatory Tender Date to
the next Interest Payment Date, and any such Bond which is not tendered but
for which there has been irrevocably deposited in the Bond Purchase Fund (as
such term is defined in the Indenture) with the Trustee an amount sufficient
to pay the purchase price thereof (an "Untendered Bond") shall not be
entitled to receive interest on such Bond on and after the Mandatory Tender
Date.
(ii) This Bond shall be tendered to the Trustee for purchase at or
before 12:00 o'clock, noon, Minneapolis time on the Business Day prior to the
Mandatory Tender Date, by delivering this Bond to the Trustee together with
an appropriate instrument of transfer duly executed in blank, and on the
Mandatory Tender Date, the Trustee shall purchase this Bond or cause this
Bond to be purchased at a purchase price equal to the principal amount
hereof.
(iii) If this Bond is not tendered on or before the Mandatory Tender
Date, then the Holder hereof shall not be entitled to receive interest on this
Bond for any period beginning on or after the Mandatory Tender Date, and
upon surrender of this Bond to the Trustee, the Holder of this Bond shall be
paid only an amount equal to the purchase price of this Bond due on the
Mandatory Tender Date and interest through the Mandatory Tender Date.
(9) The Bonds are subject to redemption prior to maturity as provided in
the Indenture as * follows :
A. Optional Redemption On or Prior to the Conversion Date. On or
prior to the Conversion Date, the Bonds are subject to redemption in whole
but not in part on any date on or after 1, 1995 at the option of the
Company, at a redemption price equal to the principal amount of the Bonds to
be redeemed plus accrued interest thereon.
B . Mandatory Sinking Fund Redemption Prior to Conversion Date.
The Bonds maturing on 1, (the "Term Bonds") are suo]ect
to mandatory redemption by lot in the principal increments of $5,000, at par
and accrued interest without premium, on 1 in the years and
principal amounts set forth below (unless and to the extent a credit against
any such amount is applied as provided in the Indenture):
BLP84953
RC125-94
Date Amount Date Amount
Indenture of Trust
18 First Draft - March 20, 1995
•
C. Optional and Mandatory Redemption From and After Each
Conversion bate. From and after the Conversion Date, the Bonds shall be
subject to optional and mandatory sinking fund redemptions on the dates and
at -the prices determined by the Remarketing Agent as provided in the
Indenture.
D. Calamity Redemption. After the Conversion 'Date, in the event
of (a) damage to or destruction of the Project or any part thereof or
Condemnation of the Project or any part thereof to the extent provided in
Section 8.04 of the Agreement, or in the event of any changes in the
Constitution or the laws of the United States of America or the State of
Minnesota as provided in Section 8.04 of the Loan Agreement and (b)
termination of the Loan Agreement upon the occurrence of one of those
events, all Bonds shall be redeemed by the Issuer on the earliest date for
which timely notice of call can be given, at a redemption price equal to the
principal amount to be redeemed, without any premium, plus accrued interest
to the redemption date.
E. Tax Redemption. This Bond is subject to mandatory redemption
in whole on the first day of the first calendar month for which notice of
redemption can properly be given as provided herein upon the occurrence of
a Determination of Taxability (as such term is defined in the Indenture) at a
redemption price equal to one hundred percent (100%) of the principal amount
of this Bond plus accrued interest thereon to the redemption date.
BLP84953 Indenture of Trust
RC125-94 19 First Draft - March 20, 1995
. F. Special Mandatory Redemption for Failure to Convert to a Fixed
Rate or Upon Failure to Remarket. The Bonds shall be subject to special
mandatory redemption on 1, 199_, if the Company has failed to
deliver to the Trustee and Remarketing Agent on or before 15,199 t
either (1) a written request that the interest rate on the Bonds be converted
from the Variable Rate to the Fixed Rate, accompanied by other items required
by Section 2.13 of the Indenture, or (2) an opinion of Bond Counsel to the
effect that an extension of the Conversion Date will not adversely affect the
tax exempt status of the Bonds; and (b) the written consent of all
Bondholders to the extension of the Conversion Date. In the event the
Conversion Date is extended, the Bonds shall be subject to special mandatory
redemption on the extended Conversion Date, which will be no later than
1, 19_, if the Company fails to deliver to the Trustee on or
before 45 days prior to the extended Conversion Date the written request that
the interest rate on the Bonds be converted from the Variable Rate to the
Fixed Rate accompanied by the other items required by Section 2.13 of the
Indenture. If the Company fails to deliver a Credit Facility (as defined in the
Loan Agreement) to the Trustee on or prior to the Conversion Date, the Bonds
shall be subject to special mandatory redemption on the Conversion Date.
The Bonds shall be subject to mandatory redemption on the Tender Date if the
Resale Proceeds and other funds provided by the Company are insufficient to
purchase any Bonds properly tendered on an Optional Tender Date or the Mandatory
Tender Date.
(10) In the case of any partial redemption of the Bonds of the same maturity,
the particular Bonds to be redeemed shall be selected by the Trustee in such manner
as the Trustee shall deem fair and equitable and the Bonds shall be redeemed in the
principal amounts specified in the Indenture. Any Bond which is to be redeemed
only in part shall be surrendered to the Trustee (i) for payment of the Redemption
Price (including accrued interest thereon to the Redemption Date) of the portion
thereof called for redemption and (ii) for exchange for Bonds in any authorized
denomination or denominations in aggregate principal amount equal to the
unredeemed portion of such Bond.
(11) Notice of redemption shall be mailed at least thirty (30) days but not
more than forty (40) days prior to the date fixed for redemption to each Registered
Holder.of a Bond to be redeemed. All Bonds so called for redemption, provided
funds for their redemption have been duly deposited, will cease to bear interest on
the specified redemption date and (except for the purpose of payment) shall no
longer be protected by the Indenture and shall not be deemed Outstanding under the
Indenture, and shall thereafter be payable solely from the funds provided for
payment.
(12) In addition to the foregoing, if under certain circumstances an Event
of Default, as defined in the Indenture, shall occur, the principal of all the Bonds
and all interest accrued thereon may, without prior notice to the Bondholders, be
declared due and payable in the manner and with the effect provided in the Loan
Agreement and Indenture.
(13) This Bond and the series of which it forms a part are issued pursuant
to and in full compliance with the Constitution and laws of the State of Minnesota,
particularly Minnesota Statutes, Chapter 462C, and pursuant to a resolution adopted
and approved by the Issuer, which resolution authorized the financing of the Project
BLP84953 Indenture of Trust
RC125-94 20 First Draft - March 20, 1995
and the execution and delivery of ;the Indenture,, and -the issuance of the Bonds as
special, limited obligations payable solely from revenues derived from the Loan
Agreement except that under certain circumstances the Bonds may be payable from
Bond proceeds. The loan repayments under the Loan Agreement are scheduled to
be sufficient to pay the principal of, premium, if any, and interest on the Bonds as
the same become due and payable and are to be paid to the Trustee for the account
of the Issuer and credited to the Bond Fund as a special trust fund account created
by the Issuer and have been and are hereby pledged for that purpose.
(14.) The Bonds, including principal, premium and any other payments
however designated, and the interest due thereon do not and shall never constitute
a general indebtedness of the Issuer within the meaning of any state constitutional
or statutory provision and do not and shall not constitute or give rise to a pecuniary
liability or moral obligation of the Issuer, the State of Minnesota or any of its
political subdivisions, or a charge against its general credit or taxing powers, or to
the extent permitted by law, any pecuniary liability of any officer, employee or
agent of the Issuer. The provisions of this paragraph are controlling
notwithstanding anything herein to the contrary.
(15) The Registered Holder of this Bond shall have no right to enforce the
provisions of the Indenture or to institute action to enforce the covenants therein,
or to take any action with respect to any Event of Default under the Indenture, or
to institute, appear in or defend any suit or other proceedings with respect thereto,
except as provided in the Indenture. Modifications or alterations of the Indenture,
or of any indenture supplemental thereto, may be made only to the extent and in the
circumstances permitted by the Indenture.
(16) With the consent of the Issuer, the Company and the Trustee, as
appropriate, and to the extent permitted by and as provided in the Indenture, the
terms and provisions of the Indenture, the Loan Agreement and the Letter of Credit,
or of any instrument supplemental thereto, may be modified or altered by the consent
of the Registered Holders of at least 51% in aggregate principal amount of the Bonds
then Outstanding thereunder.
(17) The Indenture also contains provisions permitting Holders of a majority
in aggregate principal amount of the Bonds at the time Outstanding, on behalf of all
the Holders of all the Bonds, to waive compliance by the Issuer with certain
provisions of the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Registered Holder of this Bond
shall be conclusive and binding upon such Registered Holder and on all future
Registered Holders of this Bond and of any Bond issued in lieu hereof whether or not
notation of such consent or waiver is made upon this Bond.
(18) The Bonds are issued as fully registered Bonds without coupons in the
Authorized Denomination. The Bonds are interchangeable for one or more Bonds in
Authorized Denominations and of the same series, aggregate principal amount,
interest rate and maturity date, upon surrender thereof by the Holder at the
principal office of the Trustee, in the manner and subject to the limitations provided
in the Indenture. The Issuer, the Trustee and any additional paying agents may
deem and treat the Registered Holder hereof as the absolute owner hereof (whether
or not this Bond shall be overdue) for the purpose of receiving payment of or on
account of principal hereof and interest (except as otherwise hereinabove provided
with respect to the Record Date) due hereon and-for all other purposes, and the
BLP84953 Indenture of Trust
RC125-94 21 First Draft - March 20, 1995
Issuer, the Trustee and any additional paying agents shall not be affected by any
notice to the contrary.
(19) Subject to the limitations provided in the Indenture, this Bond is only
transferable by the Registered Holder hereof upon surrender of this Bond for
transfer at the principal corporate trust office of the Trustee, duly endorsed or
accompanied by a written instrument or instruments of transfer in the form printed
on this Bond or in another form satisfactory to the Trustee and executed and with
guaranty of signature by, the Registered Holder hereof or his attorney duly
authorized . in writing, containing written instructions as to the details of the
transfer of'the Bond. Thereupon the Issuer shall execute (if necessary) -and the
Trustee shall authenticate and deliver, in exchange for this Bond, one or more new
Bonds in the name of the transferee (but not registered in blank or to "bearer" or
a similar designation), of an authorized denomination, in aggregate principal amount
equal to the principal amount of this Bond, of the same maturity, and bearing
interest at the same rate.
(20) No service charge shall be made to the Registered Holder for any
registration, transfer or exchange hereinbefore referred to, but the Trustee may
require payment of a sum sufficient to cover any tax, fee or other governmental
charge that may be imposed in connection with any transfer or exchange of Bonds,
other than exchanges expressly provided in the Indenture to be made without charge
to Bondholders.
(21) IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts,
conditions and things required to exist, to happen and to be performed precedent
to and in the execution and delivery of the Indenture and the issuance of this Bond
do exist, have happened and have been performed in due time, form and manner, as
required by law, and that the issuance of this Bond and the series of which it forms
a part, together with all other obligations of the Issuer, does not exceed or violate
any constitutional or statutory limitation.
(22) This Bond shall not be valid or become obligatory for any purpose or be
entitled to any security or benefit under the Indenture unless the Certificate of
Authentication hereon shall have been executed by the Trustee.
(23) IN WITNESS WHEREOF, the City of Richfield, Minnesota, by its
governing body, has' caused this Bond to be executed in its name by the facsimile
signatures of its Mayor and its City Manager and by the manual signature of a
Responsible Agent of the Trustee acting as authenticating agent.
CITY OF RICHFIELD,
MINNESOTA
Mayor
City Manager
Date of Registration:
BLP84953 Indenture of Trust
RC125-94 22 First Draft - March 20, 1995
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This Bond is one of the Bonds described in th-3 within mentioned Indenture.
FIRST TRUST NATIONAL
ASSOCIATION, Trustee
By
. Responsible Agent
ASSIGNMENT
For value received, the undersigned hereby sells, assigns and transfers unto
the within Bond and does hereby
irrevocably constitute and appoint attorney
to transfer the Bond on the books kept for the registration thereof, with full power
of substitution in the premises.
Dated :
Notice: The assignor's signature to this assignment must correspond with the
name as it appears upon the face of the within Bond in every particular,
without alteration or any change whatever.
0 Signature Guaranteed:
Signature (s) must be guaranteed by a member of a Medallion Signature Program.
The Trustee will not effect transfer of this Bond unless the information
concerning the transferee requested below is provided.
Name and Address :
(Include information for all joint owners if the Bond
is held by joint account)
Insert social security or other identifying number of Transferee
Following the Conversion Date, the foregoing form of Bond shall be revised
as appropriate to reflect the terms of the Bonds while they bear interest at a Fixed
Rate.
Section 2.02. Initial Issue. The Bonds shall be initially issued in the
aggregate principal amount of $19,679,000 and shall:
(1) be dated as of their date of original issuance, or the date of their
registration as provided in Section 2.10;
BLP84953 Indenture of Trust
RC125-94 23 First Draft - March 20, 1995
(2) be issued and delivered to the Original Purchaser as fully
registered bonds without coupons in any Authorized Denomination and be
numbered R-1 upward;
(3) subject to the . provisions of Section 2.05 hereof, mature on
1, and bear interest from Bond Closing, (i) until the
Conversion Date, at the Variable Rate provided in Section 2.03 computed on
the basis of actual days elapsed in a 365-day year; (ii) from and after the
Conversion Date until the Final Maturity Date, at the Fixed Rate provided in
Section 2.13 hereof computed on the basis of a 360-day year composed of
twelve 30-day months;
(4) prior to the Conversion Date, interest on the Bonds shall be
payable on the first Business Day of 1995, and on the first
Business Day of each month thereafter (each a "Variable Rate Interest
Payment Date"). Interest on the Bonds shall also be payable on the
Conversion Date. After the Conversion Date, interest on the Bonds shall be
payable on each 1 and 1 until payment in full of this
Bond and on the date of payment in full of this Bond (each a "Fixed Rate
Interest Payment Date") ;
(5) subject to the provisions of Section 2.13 hereof, be subject to
redemption upon the terms and conditions and at the prices specified in
Article III hereof ;
(6) be payable in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts, at the principal trust office of the Trustee acting as the Paying
Agent, or a duly appointed successor Paying Agent, except that interest on
the Bonds will be payable by check or draft mailed by the Trustee to the
Holders of such Bonds on the applicable Record Date (the "Record Date
Holders" as defined in the Bond) at the last addresses thereof as shown in the
Bond Register on the applicable Record Date, and principal of and any
premium on any Bonds shall be payable at the principal office of the Trustee;
provided that any interest on any Bond which is payable but which is not
punctually paid or duly .provided ("Defaulted Interest") shall be payable, on
a date selected by the Trustee, to the Person in whose name such Bond is
registered in the Bond Register at the close of business on a Special Record
Date selected by the Trustee and which shall be at least ten days but not more
than 30 days before the date selected by the Trustee for payment of such
Defaulted Interest. The Trustee shall give Notice by Mail of the Special
Record Date and date for payment of Defaulted Interest at least ten days
before the Special Record Date; and
(7) be subject to purchase on any Tender Date as provided in
Sections 4.01 and 4.02 hereof, and be subject to redemption upon the terms
and conditions and at the prices specified in Article Three hereof.
Notwithstanding the foregoing, if the date for payment of the principal of,
premium, if any, or interest on any Bond shall be a day which is not a Business Day,
then the date for such payment shall be the next succeeding day which is a Business
Day, and payment on such later date shall have the same force and effect as if made
on the nominal date of payment.
BLP84953 Indenture of Trust
RC125-94 24 First Draft - March 20, 1995
Notwithstanding the foregoing any Record Holder of at least $1,000,000 in
principal amount of the Outstanding' Bonds may file with the Trustee an instrument
satisfactory to the Trustee requesting the interest sayable by the Trustee to such
Holder be paid by transferring by wire transfer in immediately available funds, on
the day such payment is due, the amount to be distributed to such Holder to a
designated account maintained by such Holder at any bank in the United States. The
Trustee shall pay all amounts payable by the Trustee hereunder to such Holder by
transfer directly to said designated bank in accordance with the provisions of any
such instrument, provided that if such amount represents a payment of the principal
of any Bond, such Bond shall have been presented to the Trustee. All payments so
made shall be valid and effectual to satisfy and discharge the liability upon such
Bonds.
Section 2.03. Variable Rate. Prior to the Conversion Date, the Bonds shall
bear interest at the Variable Rate, which shall be a rate equal to sixty-two percent
(62%) of the Prime Rate. The interest rate on the Bonds shall change effective as of
the date of any change in the Prime Rate.
Section 2.04. Execution. The Bonds shall be executed on behalf of the Issuer
by the signature of its Mayor and City Manager and be sealed with the seal of the
Issuer; provided, however, that the seal of the Issuer may be a printed facsimile or
may be omitted; provided further that all of such signatures may be printed or
photocopied facsimiles, in which event the Bonds shall also be executed manually by
the Trustee as authenticating agent as provided in Section 2.05 and Minnesota
Statutes, Section 475.55. In the event of disability or resignation or other absence
of either such officer, the Bonds may be signed by the manual or facsimile signature
of that officer who may act in behalf of such absent or disabled officer. In case
either such officer whose signature or facsimile of whose signature shall appear on
the Bonds shall cease to be such officer before the delivery of the Bonds, such
signature or facsimile shall nevertheless be valid and sufficient for all purposes, the
same as if he had remained in office until delivery. The Bonds may be issued and
delivered as typewritten bonds or as printed bonds, provided that if the typewritten
bonds are delivered, the facsimile signatures of the Issuer may be confirmed
signatures'.
Section 2.05. Authentication. No Bond shall be valid or obligatory for any
purpose or be entitled. to any security or benefit under this Indenture unless a
Certificate of Authentication on such Bond; substantially in the form hereinabove set
forth, shall have been duly executed manually by a Responsible Agent. Certificates
of Authentication on different Bonds need not be signed by the same person. The
Trustee shall authenticate the signatures of officers of the Issuer on each Bond by
execution of the Certificate of Authentication on the Bond; and the executed
Certificate of Authentication on each Bond shall be conclusive evidence that it has
been authenticated and delivered under this Indenture .
Section 2.06. Delivery of Initial Issue. Upon the execution and delivery of
this Indenture the Issuer shall execute and deliver to the Trustee, and the Trustee
shall authenticate, the Bonds in the aggregate amount of $19,679,000 and the
Trustee shall deliver the Bonds to the Original Purchaser as hereinafter provided
after filing with the Trustee the following:
(1) original executed counterparts of the Loan Agreement,
Regulatory Agreement, Remarketing Agreement, the Investment Agreement,
and this Indenture;
BLPS4953 Indenture of Trust
RC125-94 25 First Draft - March 20, 1995
(2) a copy, duly certified by the Issuer's Clerk of the resolutions
adopted and approved by the governing body of the Issuer, authorizing the
execution and delivery of this Indenture, .-he Loan Agreement and the
Regulatory Agreement and the issuance of the Bonds;
(3) a request and authorization (which may be part of a certificate of
the Issuer) to the Trustee on behalf of the Issuer, signed by its Mayor and
City Manager to deliver the Bonds to the Original Purchaser therein identified
upon payment to the Trustee for the. account of the Issuer of a specified sum
plus accrued interest;
(4) the opinion of the Company's attorney in the form required by
Bond Counsel;.
(5) the opinion of Bond Counsel approving the legality of the Bonds
issued pursuant to this Indenture;
(6) any other documents or opinions as Bond Counsel may require for
purposes of rendering its opinion required under subsection (5) of this
section
Section 2.07. Mutilated, Lost, Stolen, Destroyed or Untendered Bonds.
(1) In case any Bond issued hereunder shall become mutilated or be
destroyed or lost, the Issuer shall, if not then prohibited by law, cause to be
executed, and the Trustee shall authenticate and deliver, a new Bond of like series,
amount, maturity date and tenor in exchange and substitution for and upon
cancellation of any such mutilated Bond, or in lieu of and in substitution for any .
such Bond destroyed or lost, upon the Holder's paying the reasonable expenses and
charges of the Trustee and Issuer and, in the case of a Bond destroyed or lost, the
filing with the Trustee evidence satisfactory to the Trustee that such Bond was
destroyed or lost, and of the ownership thereof, and furnishing the Issuer, the
Bank, and the Trustee with indemnity satisfactory to them. If the mutilated,
destroyed or lost Bond has already matured or been called for redemption in
accordance with its terms, it shall not be necessary to issue a new Bond prior to
payment.
(2) In addition, the Issuer may execute and the Trustee may authenticate
and deliver Bonds of the same Stated Maturity, principal amount and tenor in lieu of
and in substitution for an Untendered Bond.
(3) In executing a new Bond and in furnishing the Trustee with the written
authorization to authenticate and deliver a new Bond as provided for in this Section,
the Issuer may rely conclusively on a representation of the Trustee that the Trustee
is satisfied with the adequacy of the evidence presented concerning the mutilation,
loss, theft or destruction of any Bond.
Section 2.08. Ownership of Bonds. The Issuer, Trustee and Paying Agent
may deem and treat the Holder of any Bond, whether or not such Bond shall be
overdue, as the absolute owner of such Bond for the purpose of receiving payment
thereof and for all other purposes whatsoever, and the Issuer (or any agent
thereof), Trustee and Paying Agent shall not be affected by any notice to the
contrary..
BLP84953 Indenture of Trust
RC125-94 26 First Draft - March 20, 1995
Section 2.09. Preparation of Definitive Bonds; Temporary Bonds. The
definitive Bonds shall be lithographed or printed on steel engraved borders. Until
the definitive Bonds are prepared, the Issuer may Execute, in the same manner as
is provided in Section 2.04 (except that manual signatures and a manual seal may be
used), and deliver, in lieu of definitive Bonds, but subject to the same provisions,
limitations and conditions as the definitive Bonds, except as to the denominations
thereof, one or more temporary Bonds (which shall be registered as to principal and
interest), substantially of the tenor of the definitive Bonds, in any Authorized
Denomination, and with such omissions, insertions and variations as may be
appropriate to temporary Bonds.. The Issuer shall prepare and execute and, upon
the surrender of such temporary Bonds for exchange and the cancellation.of such
surrendered temporary Bonds, deliver in exchange therefor, at the principal
corporate trust office of the Trustee, definitive Bonds of the same aggregate
principal amount as the temporary Bonds surrendered. Until so exchanged, the
temporary Bonds shall in all respects be entitled to the same benefits and security
as definitive Bonds issued pursuant to this Indenture. All temporary Bonds
surrendered in exchange for a definitive Bond or Bonds shall be forthwith cancelled
by the Trustee.
Section 2.10. Registration, Transfer and Exchange of Bonds.
(1) The Issuer will cause to be kept at the principal corporate trust office
of the Trustee a Bond Register in which, subject to such reasonable regulations as
the Trustee may prescribe, the Issuer shall provide for the registration of Bonds
and the registration of transfers of Bonds; and the Trustee is hereby appointed
"Bond Registrar" for the purpose of registering the Bonds and transfers of the
Bonds as herein provided. The Bond Register shall contain a record of every Bond
at any time authenticated hereunder, together with the name and address of the
Holder thereof, the date of authentication, the date of transfer or payment, and
such other matters as are appropriate for the Bond Register in the estimation of the
Trustee.
(2) Upon surrender for transfer of any Bond at the principal corporate
trust office of the Trustee, the Issuer shall execute (if necessary), and the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees (but not registered in blank or to "bearer" or a similar designation), one
or more new Bonds of any Authorized Denomination, having the same Stated Maturity
and interest rate, as requested by the transferor. The execution by the Issuer of
any Bond of any denomination shall constitute full and due authorization of such
denomination and the Trustee shall thereby be authorized to authenticate and deliver
such Bond.
(3) . At the option of the Holder, Bonds may be exchanged for other Bonds
of the same series of any Authorized Denomination of a like aggregate principal
amount and Stated Maturity, upon surrender of the Bonds to be exchanged at the
principal corporate trust office of the Trustee, and upon payment, if the Issuer shall
so require, of the taxes, if any, hereinafter referred to. Whenever any Bonds are
so surrendered for exchange, the Issuer shall execute, and the Trustee shall
authenticate and deliver, the Bonds which the Holder making the exchange is
entitled to receive.
(4) All Bonds surrendered upon any exchange or transfer provided for in
this Indenture shall be promptly cancelled by the Trustee and thereafter disposed
of as directed by the Issuer.
BLPS4953 Indenture of Trust
RC125-94 27 First Draft - March 20, 1995
(5) All Bonds delivered in exchange for or upon transfer of Bonds shall be
valid special obligations of the Issuer evidencing the same debt, and entitled to the
same benefits under this Indenture, as the Bonds s--rendered for such exchange
or transfer.
. (6) Transfer of a Bond may be made on the Issuer's books by the registered
owner in person or by the registered owner's attorney duly authorized in writing.
Every Bond presented or surrendered for transfer or exchange shall (if so required
by the Issuer or the Trustee) be duly. endorsed or be accompanied by a written
instrument or instruments of transfer, in. the form printed on the Bond or in another
form satisfactory to the Trustee, duly executed and with guaranty, of signature of
the Holder thereof or his attorney duly authorized in writing and shall include
written instructions as to the details of the transfer of the Bond.
(7) No service charge shall be made to the Holder for any registration,
transfer or exchange, but the Trustee may require payment of a sum sufficient to
cover any tax, fee or other governmental charge that may be imposed in connection
with any transfer or exchange of Bonds, other than exchanges expressly provided
in this Indenture to be made without expense or without charge to Bondholders.
(8) Subject to the provisions of subsection (9) below, the Trustee as Bond
Registrar shall endeavor to comply with rules applicable to transfer agents
registered with the Securities and Exchange Commission as to the 72-hour
"turnaround" standard established for the transfer of registered corporate
securities.
(9) The Trustee shall not be required (i) to transfer or exchange any Bond
during a period beginning at the opening of business 10 days before the day of the
first publication or the mailing (if there is no publication) of a notice of redemption
of Bonds under this Indenture and ending at the close of business on the day of such
publication or mailing, or (ii) to transfer or exchange any Bond so selected for
redemption in whole or in part.
(10) The Bond Registrar shall insert in each Bond the date of registration
which, for purposes of delivering the original Bonds to the original Purchaser, shall
be the date of original issue, and which for all other events shall be the last Interest
Payment Date preceding the, date of authentication to which interest on the Bond has
been paid or made available for payment, unless the date of authentication is an
interest payment date to which interest has been paid or made available for payment,
in which case the Bond shall be dated as of the date of authentication. Each Bond
shall be so dated that neither gain nor loss in interest shall result from any
transfers, exchange or substitution provided for herein.
Section 2.11. Interest Rights Preserved. Each Bond delivered upon transfer
of or in exchange for or in lieu of any other Bond shall carry all the rights to
interest accrued and unpaid, and to accrue, which were carried by such other Bond.
Section 2.12. Cancellation of Bonds. Whenever any Outstanding Bond shall
be delivered to Trustee for cancellation pursuant to this Indenture, upon payment
of the principal amount and interest represented thereby or for replacement
pursuant to Section 2.07 or transfer pursuant to Section 2.10, such Bond shall be
cancelled and, subject to the Trustee's business practices, destroyed by Trustee
and counterparts of a certificate of destruction evidencing such destruction shall be
furnished by the Trustee to the Issuer.
BLP84953 Indenture of Trust
RC125-94 28 First Draft - March 20, 1995
Section 2.13. Fixed Rate.
(1) On and after the Conversion Date and until the Final Maturity Date, the
Bonds shall bear interest at the Fixed Rate. The Company shall have a one-time
option to convert the interest rate on the Bonds from the Variable Rate to the Fixed
Rate pursuant to this Section upon satisfaction of the following conditions : (1)
delivery of written notice from the Company to the Trustee and the Remarketing
Agent stating (i) its election under this Section to convert the interest rate on the
Bonds to. the Fixed Rate, (ii) the date on which such conversion shall occur (the
"Conversion Date"), which shall be any Business Day occurring on or after
, 199 and no later than , 199_, unless extended in
accordance with provisions of paragraph (9) below, and (y) not less than 45 days
from the date the Company gives such notice, (iii) the date on which the Fixed Rate
shall be established, which shall be not less than five Business Days prior to the
Conversion Date (the "Computation Date), and (iv) directing the Trustee to give
notice of the Conversion Date, as provided in paragraph (4) below; (2) delivery to
the Trustee and Remarketing Agent not less than 45 days prior to the Conversion
Date, of an opinion of Bond Counsel, addressed to the Company, the Issuer, the
Remarketing Agent and the Trustee, stating that such conversion to the Fixed Rate
is authorized and permitted by this Indenture and will not impair the tax exempt
status of the Bonds; and (3) delivery to the Trustee of a commitment to provide a
Credit Facility from a provider and upon terms acceptable to the Remarketing Agent.
The Company must deliver the documents referred to above no later than
199_, unless the Conversion Date is extended in accordance with the
provisions of paragraph (9) hereof, in which event the . 1, 199
deadline for the notice shall be extended to a date 45 days prior to the extended
Conversion Date. The Fixed Rate shall be the interest rate or rates on the Bonds
established by the Remarketing Agent on the Computation Date in accordance with
the provisions of paragraph (5) hereof, to be effective on and after the Conversion
Date.
(2) On the Computation Date, in accordance with the provisions of clauses
(i) and (ii) below, the Remarketing Agent shall establish the principal payment
schedule and the optional redemption schedule to become effective on the Conversion
Date.
(i) The principal payment schedule shall be such that the amount of
principal due on 1 of each year under the proposed principal
payment schedule (whether by serial maturity installments or sinking fund
installments or a combination thereof) will be such that scheduled annual debt
service on the Bonds for any Bond Year will not exceed the scheduled annual
debt service on the Bonds during any other Bond Year by more than $25,000
and provided that each maturity and sinking fund installments will be integral
multiples of $5,000.
(ii) The optional redemption schedule shall be such that the Bonds
Outstanding after the Conversion Date will be subject to redemption on any
Interest Payment Date on or after the tenth year following the Conversion
Date, in whole or in part, at the redemption prices (expressed as percentages
of the principal amounts) set forth in the table below plus accrued interest to
the Redemption Date :
Redemption
Redemption Dates Price
BLP84953 Indenture of Trust
RC125-94 29 First Draft - March 20, 1995
I or 1 of the tenth
year following the Conversion Date 102%
1 or 1 of the eleventh
year following the Conversion Date 101%
1 of the twelfth year following
the Conversion Date and thereafter 100%
provided that, the Remarketing Agent, with the consent of the Company, may
establish any other optional. redemption provisions the Remarketing Agent deems
desirable which will permit the Bonds to be remarketed at par at the lowest possible
interest rate, if an opinion of Bond Counsel is delivered to the Trustee that the
establishment of such optional redemption schedule will not impair the tax exempt
status of the Bonds.
The Remarketing Agent shall notify the Company and the Trustee, by
telephone, which notice shall be immediately confirmed in writing, of the principal
payment schedule and optional and mandatory redemption provisions.
(3) Upon receipt of notice of the principal payment schedule, the Trustee
shall determine the identifying numbers of the Bonds to mature at each maturity date
by first selecting by lot from among all Outstanding Bonds, in such manner as the
Trustee may determine, such Bonds as are sufficient to equal the aggregate principal
amount of Bonds to mature on the last maturity date, and then by selecting by lot
from among all remaining Outstanding Bonds, beginning with the earliest maturity
date and ending with the second to last maturity date, such Bonds as are sufficient
to equal the aggregate principal amount of Bonds to mature on each such maturity
date.
(4) The Trustee shall give Notice by. Mail of the Mandatory Tender Date (in
substantially the form attached to this Indenture as Exhibit A) to all Bondholders not
less than thirty (30) days prior to the Conversion Date. Failure to give such notice
shall not. invalidate the conversion to the Fixed Rate nor the effect thereof as
provided herein.
(5) On the Computation Date the Remarketing Agent shall determine the
Fixed Rate, which shall -be the annual interest rate or rates, which, in the
determination of the Remarketing Agent, would result as nearly as practicable in the
market value of each maturity of the Bonds on the Conversion Date, giving effect to
the principal payment schedule, optional redemption and any mandatory purchase
provisions established pursuant to subparagraph (2), above, being 100% of the
principal amount thereof. In determining the Fixed Rate pursuant to this Section,
the Remarketing Agent shall have due regard for general financial conditions and
such other or special conditions as in the judgment of the Remarketing Agent may
have a bearing on the Fixed Rate.
(6) If for any reason the position of Remarketing Agent is vacant or the
Remarketing Agent fails to act, the Fixed Rate shall be determined, on the
Computation Date, by the Trustee, and shall be equal to ninety-five percent (95%)
of the average yield on the basis of a term approximately equal to the earlier of the
Final Maturity Date of the Bonds or United States Treasury Bonds, as such yield is
reported in the Wall Street Journal. The optional and mandatory redemption
provisions, the principal repayment schedule, and all other terms of the Bonds shall,
be the same as those in effect immediately prior to the Conversion Date.
BLPS4953 Indenture of Trust
RC125-94 30 First Draft - March 20, 1995
(7) The determination of the Fixed Rate by the Remarketing Agent, or the
Trustee, as provided herein, shall be conclusive and binding upon the Issuer, the
Company, the Trustee and the Holders of the Bonds.
(8) The Company may, at any time prior to the Trustee giving notice of the
Conversion Date to the Bondholders, cancel the conversion to a Fixed Rate by giving
written notice-of cancellation to the Trustee, the Issuer and the Remarketing Agent.
(9) The Conversion Date may be extended, at the option of the Company,
if the 'Company delivers to the Trustee and Remarketing Agent on or prior to
199_, (a) an opinion of Bond Counsel to the effect that extending-
the Conversion Date to a date certain will not adversely affect the tax exempt status
of the Bonds, and the written consent of all Bondholders to the extension of the
Conversion Date. In no event may the Conversion Date be a date later than
1, 199_.
(10) On the Conversion Date, the Company shall deliver to the Trustee the
documents required by Section 3.05(2) of the Loan Agreement.
•
•
BLPS4953 Indenture of Trust
RC125-94 31 First Draft - March 20, 1995
ARTICLE THREE
Redemption of Bonds Before inlaturity
Section, 3.01. Redemption Provisions.
(1) The Bonds are subject to redemption and prepayment as follows:
. (a) Optional Redemption on or Prior to the Conversion Date. -The
Bonds are subject to redemption in whole on any date on or after
1, 199_, by the Issuer at the direction of the Company at a Redemption Price
equal to the principal amount of the Bonds to be redeemed plus accrued
interest thereon to the Redemption Date.
(b) Initial Mandatory Redemption Schedule. Subject to the provisions
of Section 2.13, the Bonds are subject to Mandatory Sinking Fund redemption
by lot on 1 in the years and principal amounts stated below at a
Redemption Price equal to their principal amount plus accrued interest to the
Redemption Date, without any premium:
Date Amount Date Amount
•
•
BLP84953 Indenture of Trust
RC125-94 32 First Draft - March 20, 1995
or if less than such amount of Bonds is outstanding on any such Mandatory Sinking
Fund Payment Date, an amount equal to the aggregate principal amount of all Bonds
then Outstanding.
(c) Optional and Mandatory Redemption From and After Mandatory
Purchase Date. Effective as of the Mandatory Purchase Date, the Bonds shall
be subject to optional and mandatory sinking fund redemption provisions or
conversion to serial maturities, at the times and prices established by the
Remarketing Agent pursuant to Section 2.13.
(d) Tax Redemption. Following the occurrence of a Determination of
Taxability all of the Bonds shall be redeemed in whole on the first day of the
first calendar month for which notice of redemption can properly be given in
accordance with Section 3.03 at a redemption price equal. to one hundred
percent (100%) of the principal amount of the Bonds to be redeemed plus
accrued interest thereon to the Redemption Date.
(e) Calamity Redemption. After the Conversion Date, in the event
the Company exercises its option to direct the redemption of all Outstanding
Bonds upon the occurrence of any of the events described in Section 8.04 of
the Loan Agreemqnt, all of the Bonds shall be subject to redemption and shall
be redeemed, in whole but not in part, on the next succeeding Interest
Payment Date for which notice of redemption shall properly be given, at their
principal amount, plus accrued interest, without premium.
(f) Special Mandatory Redemption Upon Failure to Convert to the
• Fixed Rate or Upon Failure to Remarket.
(i) The Bonds shall be subject to special mandatory redemption
on 1, 199_, if the Company has failed to deliver to the
Trustee and Remarketing Agent on or before , either (1) a
written request that the interest rate on the Bonds be converted from
the Variable Rate to the Fixed Rate accompanied by the other items
required by Section 2.13 hereof, or (2) (a) an opinion of Bond Counsel
to the effect that the extension of the Conversion Date to a date certain
will not adversely affect the tax exempt status of the Bonds, and (b)
the written consent of all Bondholders to the extension of the
Conversion Date. In the event the Conversion Date is extended, the
Bonds shall be subject to special mandatory redemption on the extended
Conversion Date which shall be on a date not later than
1, 199. If the Company fails to deliver to the Trustee on or before 45
days prior to the extended Conversion Date the written request that the
interest rate on the Bonds be converted from the Variable Rate to the
Fixed Rate accompanied by the other items required by Section 2.13
hereof, the Bonds shall be subject to mandatory redemption on such
extended Conversion Date. If the Company fails to deliver a Credit
Facility to the Trustee on or prior to the Conversion Date, the Bonds
shall be subject to special mandatory redemption on the extended
Conversion Date.
(ii) In addition, the Bonds shall be subject to mandatory
redemption on the Tender Date if Resale proceeds and other funds
provided by the Company are insufficient to purchase the Bonds
BLP84953 Indenture of Trust
RC125-96 33 First Draft - March 20, 1995
properly tendered (or deemed tendered) on an Optional Tender Date or
the Mandatory Tender Date.
Section 3.02. Partial Redemption of Bonds. In the case of any partial
redemption of Bonds of the same maturity pursuant to any provision of this
Indenture, the particular Bonds or portions thereof to be redeemed shall be selected
by the Trustee in such manner as the Trustee shall deem fair and equitable;
provided that if at the time of selection of any Bonds for redemption any Bonds are
Company Bonds, such Company Bonds shall be selected for redemption prior to any
other Bonds. In the case of any partial redemption of a Bond in a denomination
greater than $5,000 then for all purposes in connection with such redemption, the
first $5,000 of face value of such Bond shall be treated as though it were a separate
Bond in the denomination of $5,000 and each remaining $5,000 of face value of such
Bond shall be treated as though it were a separate Bond in the denomination of
$5,000, and such Bond shall be redeemed only in a principal amount sufficient to
redeem one or more of such separate Bonds in full. Any Bond which is to be
redeemed only in part shall be surrendered to the Trustee (i) for payment of the
Redemption Price (including accrued interest thereon to the Redemption Date) of the
portion thereof called for redemption and (ii) for exchange for Bonds in any
Authorized Denomination in, aggregate principal amount equal to the unredeemed
portion of such Bond without charge therefor. For all purposes of this Indenture,
unless the context otherwise requires, all provisions relating to the redemption of
Bonds shall relate, in the case of any Bond redeemed or to be redeemed only in part,
to the portion of the principal of such Bond which has been or is to be redeemed.
Section 3.03. Procedure for Redemption. In the event the Company shall give
notice to the Trustee of any redemption of the Bonds under 3. 01, the Trustee shall
give notice, in the name of the Issuer, of the redemption of such Bonds, which
notice shall (1) specify the Bonds (or portions thereof) to be redeemed, the
Redemption Date, the redemption price and the place or places where or, if a partial
redemption the manner in which the amounts due upon such redemption will be
payable and (2) state that on the Redemption Date the Bonds (or portions thereof)
to be redeemed shall cease to bear interest. Such notice may set forth any additional
information relating to such redemption. The Trustee shall give such Notice By Mail
at least thirty (30) days nor more than forty (40) days prior to the date fixed for
redemption, to the Holders of the Bonds to be redeemed.
Any Bonds and portions of Bonds which have been duly selected for
redemption and which are deemed to be paid in accordance with Article Nine hereof
shall cease to bear interest on the specified Redemption Date.
Section 3.04. Payment of Bonds Upon Redemption. The Redemption Price of
Bonds or portions thereof called for redemption in accordance with Section 3.03 shall
be payable on the date of redemption upon presentation and surrender of such Bonds
at the place or places of payment. If, on the Redemption Date, sufficient moneys
shall have been deposited with the Trustee to effect such redemption in accordance
with this Indenture, then interest shall cease to accrue on all Bonds or portions
thereof so called for redemption.
Section 3.05. No Partial Redemption After Default. Anything in this
Indenture to the contrary notwithstanding, if there shall have occurred and be
continuing an Event of Default, there shall be no redemption of less than all of the
Bonds at the time Outstanding.
BLPS4953 Indenture of Trust
RC125-94 34 First Draft - March 20, 1995
Section 3.06. Cancellation. All Bonds which have been redeemed shall be
cancelled by the Trustee as provided in Section 2.12 and shall not be reissued.
•
•
BLPS4953 Indenture of Trust
RC125-94 35 First Draft - March 20, 1995
ARTICLE FOUR
Purchase and Remarketing of Bonds
Section 4.01. Optional Tender of Bonds at Option of Holder.
(1) Prior to the Conversion Date, the Trustee, acting on behalf of the
Company and for the benefit of the Holder of the Bonds from time to time, shall
purchase any Bond, in whole but not in part, for the account of the Company, or
cause the Bond to be otherwise purchased, upon notice from the Holder thereof,
such purchase to occur on any Business Day, but only upon:
(A) notice by the Holder communicated to the Remarketing Agent and
the Trustee by written or printed telex or other means of written or printed
instantaneous communication delivered to the Remarketing Agent at its
principal office and the Trustee at it principal corporate trust office (the
"Optional Tender Notice") stating (i) the principal amount of such Bond, and
(ii) the date on which such Bond shall be purchased pursuant to this Section
4. 01, which date shall be a Business Day on or next prior to the seventh
calendar day next succeeding the date of the giving of the Optional Tender
Notice; and
J
(B) delivery of such Bond (with an appropriate instrument of
transfer executed in blank) to the Trustee by 12:00 o'clock Noon, Minneapolis
time, on the Business Day prior to the date specified in such Optional Tender
Notice, and, if tendered prior to a Variable Rate Interest Payment Date and
after the Record Date in respect thereof, accompanied by a due-bill check in
form satisfactory to the Trustee for interest accruing after the Optional
Tender Date through the next Variable Rate Interest Payment Date.
(2) Immediately upon receipt by the Trustee of an Optional Tender Notice
delivered .to it in accordance with subsection (1) of this Section 4.01, the Trustee
shall give notice by telephone or telex, promptly confirmed in writing, to the
Company, and the Remarketing Agent specifying the principal amount of Bonds to
be purchased pursuant to said Notice and the date for.such purchase. On such
Optional Tender Date if such Bond has been properly delivered in a timely manner
to the Remarketing Agent, the Trustee, on behalf of the Company, shall purchase
the Bonds identified in such Optional Tender Notice from the Holder thereof for the
account of the Company, or cause such Bonds to be purchased, at a purchase price
equal to the principal amount thereof to be purchased, plus accrued interest
thereon. Funds for the payment of the purchase price of such Bonds shall be
provided by the Company. The Company may provide for the purchase price of the
Bonds from Resale Proceeds.
Section 4.02. Mandatory Tender of Bonds.
(1) Subject to the provisions of subsection (3) below, the Holder of each
Bond shall tender such Bond to the Trustee for purchase on the Mandatory Tender
Date, all as more fully provided in this Section 4.02.
(2) Notice of a Mandatory Tender Date (a "Mandatory Tender Notice") shall
be given by the Trustee, by first-class mail, postage prepaid, to the Holders of all
Bonds at their addresses appearing on the Bond Register maintained by the Trustee
BLP84953 Indenture of Trust
RC125-94 36 First Draft - March 20, 1995
not less than 30 days prior to the Mandatory Tender Date. Such Notice shall specify
the Mandatory Tender Date and state (A) that all Bonds shall be purchased on the
Mandatory Tender Date at a purchase price equal to the principal amount thereof,
and (B) that all Bonds must be tendered for purchase at or before 12:00 o'clock
Noon, Minneapolis time, on the Business Day prior to the Mandatory Tender Date
together with an appropriate instrument of transfer executed in blank, and, if
tendered prior to an Interest Payment Date and after the Record Date in respect
thereof, accompanied by a due-bill check in form satisfactory to the Trustee for
interest due on such Interest Payment Date accruing after the Mandatory Tender
Date, and the Holder of any such Bond which is not so tendered but for which there
has been irrevocably deposited with the Trustee an amount sufficient to pay the
purchase price thereof (an "Untendered Bond") shall not be entitled to receive
interest on such Bond for any period beginning on or after the Mandatory Tender
Date. A copy of any Mandatory Tender Notice shall be delivered by the Trustee to
the Remarketing Agent and the Company.
(3) All Bonds shall be tendered to the Trustee for purchase at or before
12:00 o'clock Noon Minneapolis time on the Business Day prior to the Mandatory
Tender Date, by delivering such Bonds to the Trustee together with an appropriate
instrument of transfer duly executed in blank. On the Mandatory Tender Date the
Trustee acting on behalf of the Company and for the benefit of the Holders of the
Bonds from time to time shall purchase or cause to be purchased all Bonds at a
purchase price equal to the principal amount thereof plus accrued interest thereon.
Funds for the payment of the purchase price of such Bonds shall be provided by the
Company. The Company may provide for the purchase price of the Bonds from the
Resale Proceeds.
Section 4.03. Duties of Trustee. The Trustee agrees, and will cause each of
0 its agents to agree, that it will:
(1) hold all Bonds delivered to it pursuant to Sections 4.01 and 4.02
hereunder in trust solely for the benefit of the respective Bondholders which
shall have so tendered such Bonds for purchase until the payment of the
purchase price with respect to such Bonds; and
(2) hold all moneys delivered to it hereunder for the purchase of such
Bonds in trust solely for "the benefit of the Holders which shall have so
tendered such: Bonds for purchase until such moneys shall have been
delivered to or for the account of such Bondholders.
Section 4.04. Remarketing of Bonds.
(1) Pursuant to the terms of the Remarketing Agreement, the Remarketing
Agent shall offer for sale and use its best efforts to sell the Bonds on a Tender Date
at a purchase price of par plus accrued interest.
(2) At or prior to 10:00 a.m., Minneapolis, Minnesota, time, on the third
Business Day prior to a Tender Date, the Remarketing Agent shall give notice (the
"Remarketing Notice"), by telephone, telex or telecopier, promptly confirmed in
writing, to the Company and the Trustee specifying the total principal amount and
denominations of the Bonds, if any, sold for settlement on such Tender Date and
shall include in the Remarketing Notice given to the Trustee the name, address and
taxpayer identification number of the purchaser. On or prior to 12:00 Noon,
Minneapolis, Minnesota, time on the Tender Date, the Remarketing Agent shall
BLP84953 Indenture of Trust
RC125-94 37 First Draft - March 20, 1995
deliver to the principal office of the Trustee, in immediately available funds, an
amount equal to the purchase price of the total principal amount of Bonds so
specified in the Remarketing Notice, plus accruee. interest, if any. If in the
Remarketing Notice, the Remarketing Agent shall have specified the name(s) in
which each remarketed Bond is to be registered together with the purchaser's
address and taxpayer identification number of the purchaser, and the denomination
in which each'•remarketed Bond is to be issued, delivery of such Bonds, properly
executed on behalf of the Issuer and authenticated by the Trustee, registered in the
name(s) and issued in the denomination (s) so specified, shall be made to the
Remarketing Agent by.12 : 00 Noon, Minneapolis time at its Minneapolis address on the
Tender Date against payment by the Remarketing Agent as aforesaid.
Section 4.05. Purchase of Tendered Bonds. On the Tender Date, the Trustee
shall pay, but only from funds in the Bond Purchase Fund, the purchase price for
all Bonds properly tendered, (or deemed tendered) for purchase pursuant to
Sections 4.01 and 4.02 hereof, at a purchase price equal to 100% of the principal
amount thereof plus accrued interest to the Tender Date. The Remarketing Agent
shall immediately deliver to the Trustee for deposit in the Bond Fund any amounts
on hand with the Remarketing Agent after the payment of the purchase price of the
Bonds to be purchased on any Tender Date.
Section 4.06. Intentionally Omitted.
Section 4.07. Purchase Not to Constitute a Redemption. The Issuer and the
Trustee recognize and acknowledge that, in carrying out their responsibilities under
this Article Four, the Trustee and the Remarketing Agent shall be acting solely for
the benefit of the Holders from time to time of the Bonds and the Company. No
. .
delivery of Bonds to the Trustee or purchase of Bonds under this Article shall
constitute a redemption of the Bonds or an extinguishment of the debt evidenced
thereby.
Section 4.08. Untendered Bonds. Any Bond which is not tendered on or prior
to the Mandatory Tender Date with respect to such Bond (an "Untendered Bond"),
as to which there has been irrevocably deposited with the Trustee an amount
sufficient to pay the purchase price thereof shall be "deemed tendered" for purposes
of this Indenture and shall cease to accrue interest on such Mandatory Tender Date,
as the case may be, and the Holder thereof shall not be entitled to any payment other
than the purchase price for such Untendered Bond, and shall no longer be entitled
to the benefits of this Indenture, except for payment of the purchase price therefor
and interest thereon through the Mandatory Tender Date from moneys held by the
Trustee for such purpose upon presentment of such Bond to the Trustee. In lieu
of and in substitution for such Untendered Bonds, Bonds shall be issued in
accordance with Section 2.07 hereof.
BLP84953 Indenture of Trust
RC125-94 38 First Draft - March 20, 1995
ARTICLE FIVE
General Covenants
Section 5.01. Payment of Principal, Premium and Interest. Solely from the
moneys derived from the Loan Agreement (other than to the extent payable from
proceeds of the Bonds or temporary investments), the Issuer will duly and
punctually pay the principal of, premium, if any, and interest on the Bonds in
accordance *ith the terms of the Bonds and this Indenture. Moneys derived from
the Loan Agreement include all moneys derived from the Granting Clauses set forth
herein, including, but not limited to, Basic Payments under the Loan Agreement and
trust funds deposited in the funds and accounts established under Article Six herein
to the extent and in the manner provided in said Article. Nothing in the Bonds or
in this Indenture shall be considered as assigning or pledging funds or assets of the
Issuer other than those covered by the Granting Clauses set forth herein.
Section 5.02. Performance of and Trustee for Covenants. The Issuer
covenants that it is duly authorized under the Act to issue the Bonds authorized
hereby, to execute this Indenture, to loan the Bond proceeds to the Company and
to assign and pledge the payments from the Loan Agreement in the manner and to the
extent herein set forth; that all action on its part for the issuance of the Bonds and
the execution and delivery of this Indenture has been duly and effectively taken.
Section 5.03. Instruments of Further Assurance. The Issuer covenants that
it has not made, done, executed or suffered, and will not make, do, execute or
suffer, any act or thing whereby its interest in the Loan Agreement or any part
thereof is now or at any time hereafter impaired, changed or encumbered in any
manner whatsoever, except as may be expressly permitted herein; and that it will
do, execute, acknowledge and deliver or cause to be done, executed, acknowledged
and delivered, such instruments supplemental hereto and such further acts,
instruments and transfers as the Trustee may reasonably require for the better
assuring, transferring, pledging, assigning and confirming unto the Trustee all and
singular the sums assigned and pledged hereby to the payment of the principal of
and interest on the Bonds.
Section 5.04. Recordin and Filing. The Trustee covenants that solely from
available Additional Charges it will require'the Company to cause this Indenture, all
supplements thereto, to be kept, recorded and filed in such manner and in such
places as may be required by law in order to preserve and protect fully the security
of the Holders of the Bonds and the rights of the Trustee hereunder and under any
other instruments aforesaid.
Section 5.05. Books and Records. The Trustee covenants that so long as any
Outstanding Bonds issued hereunder and secured by this Indenture shall be unpaid,
the Trustee will keep proper books or records and accounts, in which full, true and .
correct entries will be made of all its financial dealings or transactions in relation to
the Project and the payments derived from the Loan Agreement and this Indenture.
At reasonable times and under reasonable regulations established by the Trustee,
such books shall be open to the inspection of Holders and such accountants or other
agencies as the Trustee may from time to time designate.
Section 5.06. Bondholders' Access to Bond Register. Except as otherwise
may be provided by law, the Bond Register shall not be deemed a public record and
BLP84953 Indenture of Trust
RC125-94 39 First Draft - March 20, 1995
shall not be made available for inspection by the public, unless and until notice to
the contrary is given to the Trustee by the Issuer.
Section 5.07. Rights Under Loan Agreement. The Loan Agreement sets forth
covenants and obligations of the Issuer and the Company, and reference is hereby
made to the same for a detailed statement of said covenants and obligations. The
Issuer agrees to cooperate in the enforcement of all covenants and obligations of the
Company under the Loan Agreement and agrees that the Trustee in its name or in the
name of the Issuer may enforce all rights of the Issuer and all obligations of the
Company under and. pursuant to the Loan Agreement and on behalf of the Holders,
whether or. not the Issuer has undertaken to enforce such rights and obligations.
•
•
BLP84953 Indenture of Trust
RC125-94 L10 First Draft - March 20, 1995
ARTICLE SIX
Funds and Accounts
Section 6.01. "Trust Moneys" Defined. All moneys received by the Trustee:
(1) as elsewhere herein provided to be held and applied under this
Article VI, or required to be paid to the Trustee and whose disposition is not
elsewhere herein otherwise specifically provided for, including, but not
limited. to the investment income of all Trust Funds held by the Trustee under
this Indenture; or
(2) as proceeds from the sale of the Bonds; or
(3) as Loan Payments, or as otherwise payable under the Agreement;
(all such moneys being herein sometimes called "Trust Moneys") shall be held by the
Trustee as a part of the Trust Estate, and, upon the exercise by the Trustee of any
remedy specified in Article X hereof,. such Trust Moneys shall be applied in
accordance with Sectiop 10.06 hereof, except to the extent that the Trustee is
holding in trust .moneys or Government Obligations, as the case may be, for the
payment of any specified Bonds which are no longer deemed to be Outstanding under
the provisions of Article IX hereof, which moneys or Government Obligations shall
be applied only as provided in said Article IX. Prior to the exercise of any such
remedy, all or any part of the Trust Moneys shall be held, invested, withdrawn,
paid or applied by the Trustee, from time to time, as provided in this Article VI, in
Article VII and Article VIII hereof.
Section 6.02. Project Fund.
(1) There is hereby created a Project Fund.
Until the Conversion Date, all proceeds of the Bonds shall be deposited in the
Project Fund held by the Trustee and invested in the Investment Agreement. Prior
to the Conversion Date, the Trustee shall transfer the interest earnings on Bond
proceeds held in the Project Fund to the Bond Fund on each Variable Rate Interest
Payment Date and on the Conversion Date. Not less than seven (7) days prior to the
Conversion Date the Trustee shall request repayment of all principal invested
pursuant to-the Investment Agreement in accordance with its terms.
(2) If (a) the Company has not delivered to the Trustee the written notice
that it has exercised its option to convert the interest on the Bonds from the
Variable Rate to the Fixed Rate at least 45 days prior to the Conversion Date, as it
may be extended from time to time, or (b) if the Trustee has not received sufficient
Resale Proceeds together with other funds from the Company to effect purchase of
all of the Bonds on a Tender Date, which have been properly tendered (or deemed
tendered) the Trustee shall liquidate the funds held under the Investment
Agreement and such funds shall be transferred to the Bond Fund and applied
exclusively to redeem the Bonds in accordance with Section 3.01(f) hereof.
(3) On the Conversion Date, $ shall be transferred from the Project
Fund to the Reserve Fund. From and after the Conversion Date, or the Discharge
Date, the remaining proceeds of the Bonds shall be disbursed by the Trustee to or
BLPS4953 Indenture of Trust
RC125-94 41 First Draft - March 20, 1995
for the account of the Company from the Project Fund in accordance with the
applicable provisions of Article 3 of the Loan Agreement. 0
(4) Any sums in the Project Fund in excess of any amount required to pay
all Costs of the Project shall be transferred to the Bond Fund at the time or times and
in the manner provided in Article 3 of the Loan Agreement.
(5) Any funds deposited in the Project Fund by the Company shall be
disbursed before any Bond proceeds, including any earnings thereon, shall be
disbursed.
(6) Any interest earned on sums held in the Project Fund after the
Conversion Date but prior to the Completion Date shall remain a part of the Project
Fund.
(7) In the event the Bonds are to be redeemed on. the Conversion Date
pursuant to Section 3.01(f) hereof, the Trustee shall apply the proceeds of the
Investment Agreement to the redemption of the Bonds.
Section 6.03. Bond Fund. There is hereby created the Multifamily Housing
Revenue Bonds (Century Court Apartments Project) Series 1995 Bond Fund, also
referred to herein as the Bond Fund.
(a) There shall be credited to the Bond Fund, as and when received:
(A) each payment received by the Trustee under and pursuant
to any of the provisions of this Indenture or the Loan Agreement which
is required to be paid into the Bond Fund, or which is accompanied by
directions that such payment is to be credited to the Bond Fund;
(B) all income derived from the investment of amounts
described in clause (A), as realized;
(C) each Basic Payment made directly by the Company
pursuant to Section 4.02 or 4.03 of the Loan Agreement.
(b) TheTrustee shall disburse, from time to time, sufficient moneys
from the Bond Fund as specified below to pay the principal of, premium if any,
and the interest on, the Bonds as the same become due and payable.
(c) If any Bond shall not be presented for payment at Maturity,
provided moneys sufficient to pay such Bond shall have been made available
to the Trustee and are held by the Trustee for the benefit of the Holder
thereof, all liability of the Issuer to the Holder thereof for the payment of
such Bond shall forthwith cease, determine and be completely discharged, and
thereupon it shall be the duty of the Trustee to hold such moneys, without
liability for interest thereon, for the benefit of the Holder of such Bond, who
shall thereafter be restricted exclusively to such moneys for any claim of
whatever nature on his part hereunder or on, or with respect to, such Bond.
(d) Any moneys remaining in the Bond Fund after payment in full of
all Bonds, and payment of the fees, charges and expenses of the Trustee, the
Paying Agent, the Issuer and any Co-Paying Agent which have accrued aud.
which will accrue and all other items required to be paid hereunder.
BLPS4953 Indenture of Trust
RC125-94 42 First Draft - March 20, 1995
(e) Moneys in the Bond Fund shall be invested as provided in Section
8.01 hereof.
Section 6.04*. Bond Purchase Fund.
(1) There is hereby created a Bond Purchase Fund which shall be used to
pay the purchase price of Bonds to be purchased pursuant to Sections 4.01 and
4.02.
(2) Payments, Into the .Bond Purchase Fund.
(A) There shall be paid into the Bond Purchase Fund, as and when
received
(i) the proceeds of the remarketing of Bonds by the
Remarketing Agent pursuant to Section 4.04 (which proceeds (together
with any investments thereof and the income therefrom and proceeds
thereof) shall at all times be traceable by the Trustee to their source
and shall not be derived directly or indirectly from the Company) ; and
(ii) . all other moneys received by the Trustee under and
pursuant to any of the provisions of this Indenture or the Loan
Agreement or otherwise which are required or accompanied by
directions that such moneys are to be credited to the Bond Purchase
Fund.
(3) Use of Moneys in the Bond Purchase Fund .
(A) Except as provided in subsection (5) hereof and this subsection
(3), money in the Bond Purchase Fund shall be used solely for the payment
of the purchase price of Bonds to be purchased pursuant to Sections 4.01 and
4.02.
(B) On the Tender Date, the Trustee shall disburse from the Bond
Purchase Fund sufficient moneys to pay the purchase price of all Bonds to be
purchased on such date pursuant to Sections 4.01 and 4.02.
(4) Money to be Held in Trust. All moneys paid over to the Trustee for the
account of the Bond Purchase Fund under any provision hereof shall be held
(subject to *the provisions of subsection (5)) in trust by the Trustee for the benefit
of the Holders of the Bonds.
(5) No Payments to the Company from the Bond Purchase Fund. Any
moneys held by the Trustee in the Bond Purchase Fund shall be retained by the
Trustee exclusively for the benefit of Holders of Bonds not yet presented for
payment of the purchase price thereof until paid to such Holders; and such moneys
shall not, under any circumstances or at any time whatsoever, be paid to the
Company or to any Person other than the Holders of Bonds entitled thereto, and
such Holders shall look only to such moneys for the payment of the purchase price
of such Bonds.
E
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Section 6.05. Excess Investment Earnings Fund.
(1) There is hereby created an Excess Investment Earnings Fund. The
Trustee shall deposit in the Excess Investment Earnings Fund, upon receipt, all
rebate amounts deposited with the Trustee in accordance with Section 7.07 (14) of the
Loan Agreement; and for purposes of making such deposits the Trustee shall, at the
direction of the Company, transfer from the appropriate Fund to the Excess
Investment Earnings Fund a sum equal to any rebate amounts attributable to sums
held in the Bond Fund or Reserve Fund.
(2) . The Trustee shall cooperate with the Company in making the
determinations for each . computation required pursuant to 7.07 (14) of the Loan
Agreement; and to that end, the Trustee shall, within 30 days after the end of the
fifth Bond Year, prepare and file with the Company a report with respect to the
Bond Fund and Reserve Fund setting forth the total amount invested during the
preceding five Bond Years, the investments made with the moneys in the Bond Fund,
Project Fund and Reserve Fund and the investment earnings (and losses) resulting
from such investments, together with such additional information concerning the
Bond Fund and the investments therein as the Issuer or the Company shall
reasonably request.
(3) Upon written direction of the Company, the Trustee shall remit sums in
the Excess Investment Earnings Fund to the United States as provided in Section
7.07 (14) of the Loan Agreement.
(4) Upon written direction of the Company, the Trustee shall remit to the
Company, or transfer to the Bond Fund, any surplus rebate sums held in the Excess
Investment Earnings Fund as provided in Section 7.07 (14) of the Loan Agreement.
Section 6.06. Reserve Fund. There is hereby created a Reserve Fund which
shall be funded on the Conversion Date in the amount of $ transferred
from the Project Fund. Amounts on deposit in the Reserve Fund shall be transferred
to the Bond Fund on any Interest Payment Date to the extent amounts then on
deposit in the Bond Fund are insufficient for the purpose of paying principal and
interest on the Bonds then due.
Section 6.07. Deposit of Funds with Paying Agent.
(1) The Trustee shall transfer and remit sums from the Bond Fund to the
Paying Agent in advance of each interest and principal due date and redemption
date, from the balance then on hand in the Bond Fund, sufficient to pay all
principal, interest and redemption premiums then due on Bonds. The Paying Agent
shall hold in trust for the Holders of such Bonds all sums so transferred to it until
paid to such Holders or otherwise disposed of as herein provided.
(2) Interest on each Bond including accrued interest to the date of deposit
and interest, to the extent permitted by law, on overdue installments of interest at
the rate borne by such Bond, (a) shall cease on its maturity date, or on any prior
date on which it shall have been duly called for redemption as herein provided,
provided that funds sufficient for the payment thereof with accrued interest and any
redemption premium have been deposited with the Paying Agent on or before the
maturity date or redemption date, as the case may be, and in the case of redemption,
that the requirements of Article Three have been complied with, or (b) shall cease
on any date after maturity on which- such deposit has been made, and the Holder
BLP84953 Indenture of Trust
RC125-94 44 First Draft - March 20, 1995
shall have no further rights with respect to the Bonds or under this Indenture
except to receive the payment so deposited.
(3) If any Bond is not presented for payment when due and funds sufficient
to pay such Bond shall have been paid to the Trustee (or other Paying Agent, if
any) : (i) all liability of the Issuer for payment of such Bond shall forthwith cease,
(ii) . such Bond shall forthwith cease to be entitled to any lien, benefit or security
under this Indenture, and the Holder of such Bond shall forthwith have no rights
in respect thereof except to receive payment thereof, and (iii) the Trustee (or other
Paying. Agent, if any)-. shall hold such funds, - without liability for interest thereon,
for the benefit of the Holder of such Bond. Any moneys still held by the Trustee (or
other Paying Agent, if any) after two years and eleven months from the date on
which the Bond with respect to such amount was paid to the Trustee (or other
Paying Agent, if any), shall, if and to the extent permitted by law, be paid by the
Trustee (or other Paying Agent, if any) to the Company and shall be discharged
from the trust and all liability of the Paying Agent or the Trustee with respect to
such trust money shall cease; and the Bondholders shall thereafter be entitled to
look only to the Company for payment, and the Company shall not be liable for any
interest thereon.
(4) If there is any Paying Agent who is not the Trustee, the Trustee will
cause such Paying Agent to execute and deliver to it an instrument hi which such
Paying Agent shall agree with the Trustee, subject to the provisions of this Section
6.07, that such Paying Agent will:
(a) hold all sums held by it for the payment of principal of. (and
premium, if any) or interest on Bonds in trust for the benefit of the Holders
of such Bonds until such sums shall be paid to such Holders or otherwise
disposed of as herein provided; and
(b) at any time during the continuance of any default in the making
of any such payment of principal (and premium, if any) or interest, upon the
written request of the Trustee forthwith pay to the Trustee all sums so held
in trust by such Paying Agent.
The Trustee, acting as Paying Agent, shall also be bound by the terms of the
foregoing requirements.
is
BLPS4953 Indenture of Trust
RC125-94 45 First Draft March 20, 1995
ARTICLE SEVEN
Intentionally Omitted
•
•
BLP84953 Indenture of Trust
RC125-94 46 First Draft - March 20, 1995
•
ARTICLE EIGHT
Investments
Section 8.01. Investments by Trustee.
(1) Except during the continuance of an Event of Default, and subject to
the provisions of section 8.02, moneys, held for the credit of the Funds established
by Article Six shall be held by the Trustee as required by law and shall at the
written request of the Representative of the Company, to the extent practicable. and
permitted by the Act, and except as provided below with respect to the moneys in
the Bond Fund be invested as received and reinvested by the Trustee in Permitted
Investments (including investments in securities authorized by Minnesota Statutes,
Section 471.56, through a common trust fund or similar fund maintained by a bank
exclusively for the collective investment and reinvestment of moneys contributed
thereto by the bank in its capacity as trustee, certificates of deposit, and
repurchase agreements).
Subject to Minnesota Statutes, Sections 471.56 and 475.66, as to the
investment of sums (otl4er than Bond proceeds) held in the Bond Fund, the type,
amount and maturity of such investments shall be as specified by the Representative
of the Company; provided that sums in the Bond Fund and may in any event only be
invested in securities which mature or are subject to redemption or repurchase at the
option of the Trustee on or prior to the date or dates on which the Trustee
anticipates that cash funds will be required.
(2) The Trustee shall sell and reduce to cash funds a sufficient portion of
investments under the provisions of this Section whenever the cash balance in the
fund for which the investment was made is insufficient for its current requirements.
Securities so purchased as an investment of money shall be held by the Trustee,
shall be registered in the name of the Trustee if registration is required, and shall
be deemed at all times a part of the applicable Fund, and the interest accruing
thereon and any profit realized from such investments shall be credited to the Fund
from which the investment was made, subject to any transfer to another Fund as
herein provided. Any loss resulting from such investment shall be charged to the
Fund from which the-investment was ,made.
(3) The Trustee may purchase from or sell to itself, or through any
affiliated company, as principal or agent, securities herein authorized so long as
such purchase or sale is at fair market value.
Section 8.02. Return on Investments.
(1) In directing investments pursuant to Section 8.03 of the Loan
Agreement, the Company will not instruct the Trustee to use the proceeds of the
Bonds or other sums pledged to the payment of the Bonds, directly or indirectly, to
acquire any securities or obligations the acquisition of which would cause any of the
Bonds to be an "arbitrage bond" as defined in Section 148 of the Code, and for this
purpose the Trustee, in order to restrict yield on investments, may invest in SLGS
(and accordingly is hereby authorized to act as agent of the Issuer for such
purpose). The Trustee shall be fully protected in relying on an opinion of Bond
Counsel with respect to whether the acquisition of any securities or obligations would
have the effect prohibited by this Section.
BLPS4953 Indenture of Trust
RC125-94 47 First Draft - March 20, 1995
(2) The Bonds are subject to the limitation on investment in nonpurpose
obligations imposed by Section 148 (d) (3) of the Code and applicable provisions of the
Treasury Regulations (or any successor regulations'. At no time during any Bond
Year (as such terms is defined in the Treasury Regulations) may the amounts in the
Bond Fund which are (i) not entitled to a temporary period provided in 148(c) of the
Code or the Treasury Regulations and (ii) in excess of one hundred fifty percent
(150%) of the debt service on the Bonds for any Bond Year (which amount shall be
promptly and appropriately reduced as the amount of outstanding obligations of the
Bonds is reduced) be invested in nonpurpose obligations with a yield higher than the
yield on the Bonds, and the Trustee may assume that investments directed by the
Company do not violate such requirements. In applying such requirement, however,
no sale or disposition will be required if it would result in a loss which exceeds the
amount -of the rebate which would be paid to the United States (but for such sale or
disposition) at the time of such sale or disposition. In determining whether such
150% amount is exceeded, nonpurpose investments shall be valued as provided in the
Treasury Regulations. If the yield on non-purpose investments must be restricted,
the yield on the Bonds shall be determined as provided in the Treasury Regulations
and the yield on the non-purpose investments shall be determined as provided in
applicable provisions of the Treasury Regulations. The Trustee shall acquire
nonpurpose investments at their fair market value, provided that, in the case of any
investment in United States Treasury obligations unless otherwise directed. by the
Company, the Trustee' shall purchase such obligations directly from the United
States Treasury, if such obligations are reasonably available to the Trustee for
purchase, or, if such obligations are not so available, the Trustee shall purchase
such obligations for the best price available in an arm's-length transaction,
determined in accordance with the Trustee's customary procedure.
(3) No moneys in any fund or account shall be invested in investments which
cause the Bonds to be "federally guaranteed" within the meaning of Section 149(b)
of the Code. If at any time the moneys in all funds and accounts relating to the
Bonds exceed, within the meaning of Section 149(a) of the Code, (1) amounts
invested for an initial temporary period until the moneys are needed for the purpose
for which the Bonds were issued, (ii) investments of a bona fide debt service fund,
and (iii) -investments of a reserve which meet the requirement of Section 148(d) of
the Code, then moneys in excess of such amounts shall be invested at the direction
of. the Company pursuant to Section 8.03 of the Loan Agreement in (A) bonds issued
by the United States Treasury, (B) other investments permitted under regulations,
or (C) obligations which are (a) not issued by, or guaranteed by, or insured by,
the United States or any agency or instrumentality thereof or (b) not federally
insured deposits or accounts, all within the meaning of Section 149(b) of the Code.
The Trustee shall not take any action or do anything the effect of which shall be to
cause. the Bonds to be "federally guaranteed" within the meaning of Section 149(b)
of the Code.
(4) The provisions of this Section 8.02 shall survive discharge and release
of the Indenture.
Section 8.03. Computation of Balances in Fund.
(1) In computing the assets of any Fund established hereunder, investments
and accrued but unpaid interest thereon shall be deemed a part thereof, and such
investments shall be valued at par value, or at the redemption price thereof, if then
redeemable at the option of the holder; provided that in any event for purposes of
determining whether any balance in a Fund may only be invested at a restricted yield
13LP84953 Indenture of Trust
RC125-94 48 First Draft - March 20, 1995
to comply with Section 148 of the Code and the, Federal arbitrage regulations, any
investments in the Fund shall be valued at their par value or the price (less accrued
interest) at which they were purchased, whichever is the greater.
Section 8.04. Rebate to United States. The Bonds are subject to the rebate
to the United States of earnings in excess of the yield on the Bonds imposed by
Section 148 of the Code and Section 1.148-0 through 1.148-11 of the Treasury
Regulations. The Trustee shall have no obligation to calculate the amount of, or
make, any required rebate as provided in Section 6.05. The Trustee shall cooperate
with the Company in determining the amount. of any rebate.
•
•
BLP84953 Indenture of Trust
RC125-94 49 First Draft - March 20, 1995
ARTICLE NINE
Discharge of Lien
Section 9.01. Payment of Bonds; Satisfaction and Discharge of Bonds and
obligation to Bondholders. At any time after the Conversion Date, whenever the
conditions specified in either clause (A) or clause (B) of the following subsection (1)
and the conditions specified in the following subsections (2) and (3) to the extent
applicable, shall exist, namely:
(1) either :
(A) all Bonds have been cancelled by the Trustee or delivered to the
Trustee for cancellation, excluding, however,
(i) Bonds for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Paying Agent
or Trustee and thereafter repaid to the Company or discharged from
such trust, and
(ii) Bonds alleged to have been destroyed, lost or stolen which
have been replaced or paid as provided in Section 2.07 hereof, and (1)
which, prior to the satisfaction and discharge of this Indenture as
hereinafter provided, have not been presented to the Paying gent or
the Trustee with a claim of ownership and enforceability by the Holder
thereof, or (2) whose enforceability by the Holder thereof has been
determined adversely to the Holder by a court of competent jurisdiction .
or other competent tribunal; or
(B) the Issuer or the Company has deposited or caused to be
deposited as trust funds :
(i) with the Paying Agent, cash which shall be sufficient, or
(ii) with the Trustee cash and/or Government Obligations,
which do not permit the redemption thereof at the option of the issuer
thereof,- the principal of, premium, if any, and interest on which when
due (or upon the redemption thereof at the option of the holder), will,
without reinvestment, provide cash which together with the cash, if
any, deposited with the Trustee at the same time, shall be sufficient,
to pay and discharge the entire indebtedness on Bonds not theretofore
cancelled by the Trustee or delivered to the Trustee for cancellation by
the payment of interest on and principal (and premium, if any) of the
Bonds which have become due and payable or which shall become due
at their stated maturity or redemption date, as the case may be, and
which are to be discharged under the provisions hereof, and has made
arrangements satisfactory to the Trustee for the giving of notice of
redemption, if any, by the Trustee in the name, and at the expense, of
the Company in the same manner as is provided by Section 3.02 hereof;
and
(2) the Issuer or the Company has paid, caused to be paid or made .
arrangements satisfactory to the Trustee for the payment of all other sums payable
HLP84953 Indenture of Trust
RC125-94 50 First Draft - March 20, 1995
hereunder and under the Loan Agreement, and the Related Documents by the
Trustee or the Company until the Bonds are so paid; and
(3) the Company has delivered to the Trustee a report of an Independent
Accountant stating that the payments to be made on the security referred to in
clause (B) of subsection (1) above will be sufficient to pay when due the principal
of, premium, if any, and interest on the Bonds to be defeased;
(4) if discharge is to be effected under clause (B) of subsection 1, an
opinion of Bond Counsel is delivered to the Trustee stating in effect that such
discharge will not impair the • tax exempt status ' of the Bonds; then, except as
otherwise provided in Article 7 and Sections 8.02 and 9.03, the rights of the
Bondholders shall be limited to the cash or cash and securities deposited as provided
in paragraph 1, clauses (A) or (B) above, and upon the Company's request the
rights and interest hereby granted or granted by the Loan Agreement and the
Collateral Security Documents to or for the benefit of the Trustee or Bondholders
shall cease, terminate and become null and void, and the Issuer and the Trustee
shall, at the expense of the Company, execute and deliver such instruments of
satisfaction and transfer as may be necessary, and forthwith the estate, right, title
and interest of the Trustee in and to all of the Project and in and to all rights under
the Loan Agreement and this Indenture (except the moneys or securities or both
deposited as required above and except as may otherwise be provided in Article 7
and Sections 8.02 and 9.03 shall thereupon be discharge and satisfied; except that
in any event the obligations of the Company under Sections 7.04, 7.07, 7.08 and
10.10 of the Loan Agreement shall. survive.
Section 9.02. Discharge of the Indenture. Notwithstanding the fact that the
lien of this Indenture upon the Trust Estate may have been discharged and cancelled
in accordance with Section 9.01 hereof, this Indenture and the rights granted and
duties imposed hereby, to the extent not inconsistent with the fact that the lien upon
the Trust Estate may have been discharged and cancelled, shall nevertheless
continue and subsist until the principal of and the interest on, all of the Bonds shall
have actually been paid in full and the Trustee shall have applied in accordance with
Section 5.04 or 6.08 hereof, as applicable, all funds theretofore held by the Trustee
for payment of any Bonds not theretofore presented for payment or purchase, as the
case may be, which funds shall be held in trust solely for the Holders of such Bonds
pending their application in accordance herewith.
Section 9.03. Tax Call. Notwithstanding any provisions herein to the
contrary, if (1) the Bonds have been discharged under Section 9.01 hereof, (2),
any principal thereof has not become due and payable, and (3) the Company is
required to provide for the prepayment of the Bonds under Section 7.08 of the Loan
Agreement if a Determination of Taxability should occur, the Trustee shall undertake
to prepay the Bonds due under Section 3.01(d) hereof, and this obligation of the
Trustee shall survive release and discharge of this Indenture.
•
BLPS4953 Indenture of Trust
RC125-94 51 First Draft - March 20, 1995
ARTICLE TEN
Default Provisions and Remedies
Section 10.01. Events of Default. Each of the following events is hereby
defined as, and declared to be and to constitute, an "Event of Default" hereunder:
(1) default in the due and. punctual payment of any interest on any
Bond; or
(2) default in the due and punctual payment of the principal of any
Bond at its Maturity; or
(3) default in the due and punctual payment of the purchase price of
Bonds required to be purchased pursuant to Sections 4.01 and 4.02 when
payment of such amount has become due and payable; or
(4) If default shall be made in the due and punctual payment of any
other moneys required to be paid to the Trustee under the provisions hereof
and such default shall have continued for a period of 30 days after written
notice thereof, specifying such default., shall have been given by the Trustee
to the Issuer and the Company, or to the Issuer, the Company and the
Trustee by the Holders of not less than twenty-five percent (25%) in
aggregate principal amount of the then Outstanding Bonds; or
•
(5) If default shall be made in the performance or observance of any
other of the covenants, agreements or conditions on the part of the Issuer
contained in this Indenture or in the Bonds, and such default shall have
continued for a period of 30 days after. written notice thereof given in the
manner provided in clause (3) above; or
(6) the occurrence of an Act of Bankruptcy; or
(7) the occurrence of an. "Event of Default" under the Loan
Agreement.
Section 10.02. Acceleration.
(1) Upon the occurrence of an Event of Default referred to in Section 10.01
hereof, the Trustee may, and at the written request of the Holders of not less than
25% in aggregate principal amount of the Outstanding Bonds shall, by notice in
writing delivered to the Issuer and the Company declare the principal of all Bonds
immediately due and payable, whereupon the same shall become immediately due and
payable any time herein or in the Bonds to the contrary notwithstanding.
(2) Upon any declaration of acceleration, or occurrence resulting in
acceleration under this Section 10. 02, the Trustee shall immediately declare the Basic
Payments required to be made by the Company under the Loan Agreement to be
immediately due and payable in accordance with Section 9.02 of the Loan Agreement.
(3) Upon any acceleration required under this Section 10. 02, interest shall
cease to accrue on the Bonds as of the date of declaration of such acceleration.
BLP84953 Indenture of Trust
RC125-94 52 First Draft - March 20, 1995
(4) Except as provided in this Section 10. 02, under no other circumstances
may the Trustee accelerate the payment of the Bonds.
Section 10.03. Remedies.
(1) Subject to the provisions of Sections 10. 02, upon the occurrence of an
Event of Default and acceleration of the Bonds, the Trustee may proceed to pursue
any available remedy by suit at law or in equity to enforce all rights of the
Bondholders, including without limitation the right to the payment of the principal
or premium, if any, and interest on the then Outstanding Bonds. Upon the
occurrence of an Event of Default under the Loan Agreement, the Trustee may also
enforce any and all rights, if any, of the Issuer thereunder. The Issuer may also
exercise any of its rights as provided in Section 9.12 of the Loan Agreement.
(2) If any Event of Default shall have occurred, and if it shall have been
requested to do so by the Holders of seventy-five percent (75%) in aggregate
principal amount of the then Outstanding Bonds, and if it shall have received an
indemnity bond as provided in Section 11.01 hereof, the Trustee shall be obliged to
exercise such rights and powers conferred on the Trustee by this Section and
Section 10.02 as the Trustee (being advised by Independent Counsel), shall deem
most expedient in the ipterests of the Bondholders; provided, however, that the
Trustee shall have the right to decline to comply with any such request if the
Trustee shall be advised by Independent Counsel that the action so requested may
not lawfully be taken or if the Trustee in good faith shall determine that such action
would be unjustly prejudicial to the Bondholders not parties to such request.
(3) No remedy by the terms of this Indenture conferred upon or reserved
to the Trustee (or to the Bondholders) is intended to be exclusive of any other
remedy, but each and every such remedy shall be cumulative and shall be in addition
to any other remedy (i) given to the Trustee or to the Holders hereunder or (ii) now
or hereafter existing at law or in equity or by statute.
(4) No delay or omission to exercise any right or power accruing upon any
Event of Default shall impair any such right or power or shall be construed to be- a
waiver of any such Event of Default, or acquiescence therein; and every such right
and power may be exercised from time to time and as often as may be deemed
expedient.
(5) No waiver of any Event of Default hereunder, whether by the Trustee
or by the Holders, shall extend to or shall affect any subsequent Event of Default
or impair any rights or remedies consequent thereon.
Section 10.04. Direction of Proceedings BV Bondholders. The Holders of a
majority in aggregate principal amount of the then Outstanding Bonds shall have the
right, at any time, by an instrument or instruments in writing executed and
delivered to the Trustee, to direct the method and place of conducting all
proceedings to be taken in connection with the enforcement of the terms and
conditions of this Indenture, the Loan Agreement or for the appointment of a
receiver or any other proceedings hereunder; provided, that such direction shall
not be otherwise than in accordance with the provisions of law and of this Indenture.
Section 10.05. Waiver of Stay or Extension Laws. Upon the occurrence of an
Event of Default, to the extent that such rights may then lawfully be waived, neither
the Issuer nor anyone claiming through it or under it shall or will set up, claim, or
BLP84953 Indenture of Trust
RC125-94 53 First Draft - March 20, 1995
seek to take advantage of any appraisement, valuation, stay, extension or,
redemption laws now or hereafter in force, in order to prevent or hinder the
enforcement of this Indenture, but the Issuer, fog itself and all who may claim
through or under it, hereby waives to the extent that it lawfully may do so the
benefit of all such laws and all right of appraisement and redemption to which it may
be entitled under the laws of the State of Minnesota.
Section 10.06. Priority of Payment and Application of Moneys. All moneys
received by the Trustee pursuant to any right given or action taken under the
provisions of this Article shall; after payment of the costs and expenses of ' the
proceedings resulting in the collection of such other moneys and of the related
expenses, liabilities and advances incurred or made by the Issuer or the Trustee,
be deposited in the Bond Fund. All moneys in the Bond Fund shall be applied,
subject to the provisions of Article VI, as follows:
(1) Unless the principal of all the Bonds shall have become or shall
have been declared due and payable, all such moneys shall be applied:
FIRST: To the payment to the Persons entitled thereto of all
installments of interest then due on the Bonds, in the order of the
maturity of the installments of such interest and, if the amount available
shall not be sufficient to pay in full any particular installment, then to
the payment ratably, according to the amounts due on such installment,
to the Persons entitled thereto, without any discrimination or privilege;
SECOND: To the payment to the Persons entitled thereto the
unpaid principal of any of the Bonds which shall have become due in the
order of their due dates with interest on such Bonds at the applicable
rate and, if the amount available shall not be sufficient to pay in full
the unpaid principal on Bonds due on any particular due date, then to
the payment ratably, according to the amount of principal and premium,
if any, due on such date, to the Persons entitled thereto, without any
discrimination or privilege; and
(2) If the principal of all Bonds shall have become due or shall have
been declared due and payable, all such moneys shall be applied first to the
payment of the principal and interest then due and unpaid upon the Bonds,
(other than Company Bonds) without preference or priority of principal or
any redemption premium over interest or of interest over principal or any
redemption premium, or of any installment of interest over any other
installment of interest, or of any Bond over any other Bond, ratably,
according to the amounts due respectively for principal and interest, to the
Persons entitled thereto, without any discrimination or privilege, and second,
to the payment of the principal and interest in the Company Bonds in the same
manner.
(3) If the principal of all the Bonds shall have been declared due and
payable, and if such declaration shall thereafter have been rescinded and
annulled under the provisions of this Article, then, subject to the provisions
of paragraph (ii) of this Section in the event that the principal of all the
Bonds shall later become due or be declared due and payable, the moneys shall
be applied in accordance with the provisions of paragraph (1) of this Section. 0
SLP84953 Indenture of Trust
RC125-94 54 First Draft - March 20, 1995
Whenever moneys are to be applied by the Trustee pursuant to the provisions
of this Section, such moneys shall be applied by it at such times, and from time to
time, as the Trustee shall determine, having due .•egard to the amount of such
moneys available for application and the. likelihood of additional moneys becoming
available for such application in the future. Whenever the Trustee shall apply such
funds, it shall (i) -fix the date (which shall be an interest payment date unless it
shall deem another date more suitable) upon which such application is to be made and
upon such date interest on the amounts of principal to be paid on such dates shall
cease to accrue and (ii) on or before such date set aside the moneys necessary to
effect such application. The Trustee shall give to the Bondholders mailed-notice of
the deposit with it of any such moneys and of the fixing of any such date. Neither
the Trustee nor any Paying Agent shall be required to make payment to the Holder
of any Bond until such Bond shall be presented to the Trustee for appropriate
endorsement or for cancellation if fully paid.
Whenever all Bonds and interest thereon have been paid under the provisions
of this Section 10. 06, and all expenses and charges of the Trustee and the Issuer
have been paid, any balance remaining shall be paid to the person entitled to receive
the same pursuant to Section 14.09.
Section 10.07. R-emedies Vested in Trustee. All rights of action (including
the right to file proof of claims) under this Indenture or under any of the Bonds may
be enforced by the Trustee without the possession of any of the Bonds or the
production thereof in any trial or other proceedings relating thereto, and any such
suit or proceeding instituted by the Trustee shall be brought in its name as Trustee
without the necessity of joining as plaintiffs or defendants any Holders of the Bonds,
and any recovery or judgment shall be for the equal benefit of the Holders of the
Outstanding Bonds to the extent and in the manner provided herein. The Issuer and
the Trustee hereby agree, without in any way limiting the effect and scope thereof,
that the pledge and assignment hereunder to the Trustee of all rights included
within the Trust Estate shall constitute an agency appointment coupled with an
interest on the part of the Trustee which, for all purposes of this Indenture, shall
be irrevocable and shall survive and continue in full force and effect notwithstanding
the bankruptcy or insolvency of the Issuer or its default hereunder or on the Bonds.
Section 10.08. Rights and Remedies of Holders. No Holder of any Bond shall
have any right to institute any suit, action or proceeding in equity or at law for the
enforcement of this Indenture, the Loan Agreement, or for the execution of any
trust hereof or any remedy hereunder or thereunder or for the appointment of a
receiver, unless : (i) a default thereunder shall have become an Event of Default and
the Holders of seventy-five percent (75%) in aggregate principal amount of the Bonds
then Outstanding shall have made written request to the Trustee and shall have
offered it reasonable opportunity either to proceed to exercise the powers hereunder
granted or to institute such action, suit or proceeding in its own name; (ii) such
Holders shall have offered to indemnify the Trustee as provided in Section 11.01;
and (iii) the Trustee shall thereafter fail or refuse to exercise within a reasonable
period of time the remedies hereunder granted, or to institute such action, suit or
proceeding in its own name. Such notification, request and offer of indemnity are
hereby declared in every such case at the option of the Trustee to be conditions
precedent to the execution of the powers and trusts of this Indenture, and to any
action or cause of action for the enforcement of this Indenture, the Loan Agreement,
or for the appointment of a receiver or for any other remedy hereunder; it being
understood and intended that no one or more Holders of the Bonds shall have any
right in any manner whatsoever to affect, disturb or prejudice the lien of this
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RC125-94 55 First Draft - March 20, 1995
Indenture, by its, his or their action or to enforce any right thereunder except in
the manner herein provided, and that all proceedings at law or in equity shall be
instituted, had and maintained in the manner here'u provided and for the equal
benefit of the Holders of all Bonds then Outstanding;. provided, however, that
nothing herein shall be construed to preclude any Bondholder from enforcing, or
impair the right of any Bondholder to enforce, the payment by the Trustee of
principal of, and interest and premium, if any, on any Bond of such Bondholder at
or after its date of maturity, if and to the extent that such payment is required to
be made to such Bondholder by the Trustee from available funds in accordance with
the terms hereof.
Section 10.09. Termination of Proceedings. In case the Trustee shall have
proceeded to enforce any right under this Indenture or the Loan Agreement by the
appointment of a receiver, by entry and possession or otherwise, and such
proceedings shall have been discontinued or abandoned for any reason, or shall have
been determined adversely to the Trustee, then and in every such case the Issuer
and the Trustee shall be restored to their former positions and rights hereunder
with respect to the property herein conveyed, and all rights, remedies and powers
of the Trustee shall continue as if no such proceedings had been taken.
Section 10.10. Waiver of an Event of Default. The Trustee may waive any
Event of Default and its consequences and shall do so upon written request of the
Holders of a majority in aggregate principal amount of all the Bonds then
Outstanding. No Event of Default giving rise to mandatory acceleration may be
waived. No such waiver or rescission shall extend to any subsequent or other
Events of Default, or impair any right consequent thereon.
Section 10.11. Company as Agent of Issuer. 0
(1) No default under Section 10.01(7) of this Indenture shall constitute an
Event of Default until actual notice of such default by registered or certified mail
shall be given by the Trustee to the Issuer, the Company, and the Issuer and the
Company shall have had the time permitted by the applicable subsection after receipt
of such notice to correct said default or cause said default to be corrected and the
Issuer or Company shall not have corrected said default or caused said default to be
corrected within said. time.
.(2) With regard to* any alleged default concerning which notice is given to
the Company under the provisions of this Section 10.11, the Issuer hereby names
and appoints the Company as its attorney-in-fact and agent with full authority to
perform any covenant or obligation of the Issuer alleged in said notice to constitute
a default, in the name and stead of the Issuer with full power. to do any and all
things and :acts to the same extent that the Issuer could do and perform any such
things and acts and with power of substitution; provided that the Company shall
give the Issuer notice of its intention so to perform on behalf of the Issuer, and
provided further that the Issuer may at any time, by a writing addressed to the
Company withdraw, limit or modify the appointment hereby made.
•
BLPS4953 Indenture of Trust
RC125-94 56 First Draft - March 20, 1995
ARTICLE ELEVEN
The Trustee
Section 11.01. Acceptance of the Trustee. The Trustee, prior to the
occurrence of an Event of Default, undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture; and no implied covenants or
obligations should be read into this Indenture against the Trustee. In case an Event
of Default has occurred, the Trustee agrees to perform such trusts as an ordinarily
prudent trustee under a corporate indenture, but in any such event, only upon and
subject to the following express terms and conditions :
(1) The Trustee may execute any of the trusts or powers hereof and
perform any of its duties by or through attorneys, agents, receivers, or
employees, but shall be answerable for the conduct of the same in accordance
with the standard specified above, and shall be entitled to advice of counsel
concerning all matters of trusts hereof and duties hereunder, and may in all
cases pay such reasonable compensation to any attorney, agent, receiver or
employee retained or employed by it in connection herewith. The Trustee may
act upon the written opinion or written advice of any attorney, surveyor,
engineer or accountant selected by it in the exercise of reasonable care or, if
selected or retained by the Issuer, approved by the Trustee in the exercise
of such care, provided that the only legal advice or opinion that the Trustee
may rely upon for purposes of securing advice or an opinion relating to the
tax exempt status of the Bonds is given by Bond Counsel. The Trustee shall
not be responsible for any loss or damage resulting from any action or
nonaction in good faith in reliance upon such opinion or advice.
(2) The Trustee shall not be responsible for any recital herein, or in
the Bonds (except with respect to the certificate of the Trustee endorsed on
the Bonds) or for the investment of moneys as herein provided, except as may
be provided in Section 8.02, or for the validity of the execution by the Issuer
of , this Indenture, or of any-supplemental indentures or instruments of
further assurance, or for the sufficiency of any security for the Bonds issued
hereunder or intended to be secured hereby, or for the value of title of the
property herein conveyed; if any, or otherwise as to the maintenance of the
security hereof ; except as otherwise provided in Section 5.04 and except that
in the event the Trustee enters into possession of a part or all of the property
conveyed pursuant to any provisions of this Indenture, it shall use due
diligence in preserving such property. The Trustee may, but shall be under
no duty to, require of the Company full information and advice as to the
performance of the covenants, conditions and agreements in the Loan
Agreement as to the condition of the Project and the performance of all other
obligations thereunder and shall use its best efforts, but without any
obligation, to advise the Issuer and the Company of any impending Event of
Default known to the Trustee.
(3) The Trustee shall not be accountable for the use or application
by the Issuer or the Company of any of the Bonds or the proceeds thereof
(except as herein expressly provided) or for the use or application of any
money paid over by the Trustee in accordance with the provisions of this
Indenture or for the use and application of money received by any Paying
BLPS4953 Indenture of Trust
RC125-94 57 First Draft - March 20, 1995
Agent. The Trustee may become the owner of Bonds secured hereby with the
same rights it would have if not Trustee. 0
(4) The Trustee shall be protected in acting upon any written notice,
order, requisition, request, consent, certificate, opinion (including an
opinion of Independent Counsel or Bond Counsel), affidavit, letter, telegram
or other paper or document reasonably believed by it to be genuine and
correct and to have been signed or sent by the proper person or persons.
Any action taken by the Trustee pursuant to this Indenture upon the request
or authority or consent of any person who at the time of making such request
or giving such authority or consent is the Holder of any Bond, shall be
conclusive and binding upon all future Holders of the same Bond and upon
Bonds issued in exchange therefor, upon transfer thereof, or in place
thereof.
(5) As to the existence or non-existence of any fact or as to the
sufficiency or authenticity of any instrument, paper or proceeding, the
Trustee shall be entitled to rely upon a certificate of the Issuer signed by its
Deputy Clerk under the seal of the Issuer as sufficient evidence of the facts
stated therein as the. same appear from the books and records under the
Deputy Clerk's custody or control or are otherwise known to him. The
Trustee may accept a certificate of the Deputy Clerk of the Issuer under the
seal of the Issuer to the effect that a motion, resolution or ordinance in the
form therein set forth has been adopted by the governing body of the Issuer
as conclusive evidence that such motion, resolution or ordinance has been
duly adopted, and is in full force and effect, and may accept such motion,
resolution or ordinance as sufficient evidence of the facts stated therein and
the necessity or expediency of any particular dealing, transaction or action
authorized or approved thereby, but may at its discretion, secure such
further evidence deemed necessary or, advisable, but shall in no case be
bound to secure the same.
(6) The Trustee shall not be answerable except for its own negligence
or willful default.
(7) The Trustee shall not be personally liable for any debts
contracted or for damages to persons or to personal property injured or
damaged, or for salaries or nonfulfillment of contracts during any period in
which they may be in possession of or managing the real and tangible personal
property as in this Indenture provided.
(8) At any and all reasonable times, the Trustee, and its duly
authorized agents, attorneys, experts, engineers, accountants and
representatives, shall have the right fully to inspect any and all of the
property comprising the Project, including all books, papers and records of
the Issuer pertaining to the Project and the Bonds, and to take such
memoranda from and with regard thereto as may be desired.
(9) The Trustee shall not be required to give any bond or surety
with respect to the execution of said trusts and powers or otherwise in respect
to the premises.
(10) Notwithstanding anything elsewhere in this Indenture contained,
the Trustee-shall have the right, but shall not be required, to demand, with
BLP84953 Indenture of Trust
RC125-94 58 First Draft - March 20, 1995
respect to the authentication of any Bbads,' the withdrawal of any cash, the
release of any property or any action whatsoever within the purview of this
Indenture, any showings, certificates, opinions (including opinions of
Independent Counsel), appraisals or other information, or corporate action
or evidence thereof, in addition to that by the terms hereof required as a
condition of such action by the Trustee, deemed desirable for the purpose of.
establishing the right of the Issuer to the authentication of any Bonds, the
withdrawal of any cash, the release of any property, or the taking of any
other action by the Trustee.
(11) Before taking any action under this Indenture, the Trustee may
require that they be furnished an indemnity bond satisfactory to them for the
reimbursement of all expenses to which they may be put and to protect them
against all liability except liability which is adjudicated to have resulted from
the negligence or willful default of the Trustee, by reason of any action so
taken by the Trustee.
(12) All moneys received by the Trustee, the Paying Agent, any
Co-Paying Agent or the Remarketing Agent for the Bonds shall, until used or
applied or invested as herein provided, be held in trust for the purposes for
which they were Received but need not be segregated from other funds except
to the extent required herein or by law. Neither the Trustee, the Paying
Agent, any Co-Paying Agent nor the Remarketing Agent shall be under any
liability for interest on any moneys received hereunder except such as may be
agreed upon.
(13) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of their duties hereunder, or in the exercise of any of
their rights or powers, if they shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to them.
(14) The Trustee shall make no representation as to the validity or
adequacy of this Indenture or the Bonds, it shall not be accountable for the
Issuer's use of the proceeds of the Bonds or any money paid to the Issuer or
upon the Issuer's direction under any provision hereof, it shall not be
responsible for the use or application of any money received by any Paying
Agent other than the-Trustee and it shall not be responsible for any statement
or recital herein or any statement in the Bonds or any other document in
connection with the sale of the Bonds or pursuant to this Indenture other than
its certificate of authentication.
Section 11.02. Trustee's Fees, Charges and Expenses. The Trustee and any
Paying Agent shall be entitled to payment and/or reimbursement for reasonable fees
for services rendered hereunder and all advances, counsel fees and other expenses
reasonably and necessarily made or incurred by the Trustee in and about the
execution of the trusts created by this Indenture and in and about the exercise and
performance of the powers and duties of the Trustee hereunder and for the
reasonable and necessary costs and expenses incurred in defending any liability in
the premises of any character whatsoever (unless such liability is adjudicated to
have resulted from the negligence or willful default of the Trustee). In this regard
the Issuer has made provisions in Section 4.04 of the Loan Agreement for the
payment of said fees, advances, counsel fees, costs and expenses and reference is
BLPS4953 Indenture of Trust
RC125-94 59 First Draft - March 20, 1995
hereby made to the Loan Agreement for the provisions so made; and the Issuer shall
not otherwise be liable for the payment of such sums. Upon an Event of Default, but
only upon an Event of Default, the Trustee shall Lave a first lien with right of
payment prior to payment on account of interest on or principal or premium, if any,
of any Bond and upon the money received by it hereunder, for said fees, advances,
counsel fees, costs and expenses incurred by it.
Section 11.03. Notice to Holders of Default. The Trustee shall give to the
Bondholders written notice of all Events of Default known to the Trustee, within
ninety (90) days after the occurrence of an Event of Default; provided that, except
in the case of an Event of Default in the payment of the principal of or interest on
any of the Bonds, the Trustee shall be protected in withholding such notice if and
so long as the Board of Directors, the executive committee or a trust committee of
directors or chief executive officer of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Holders.
Section 11.04. Intervention by Trustee. In any judicial proceeding to which
the Issuer is a party and which in the opinion of the Trustee and its counsel has a
substantial bearing on the interests of Holders of Bonds, the Trustee may intervene
on behalf of Holders and shall do so if requested in writing by the Holders of at least
twenty-five percent (25%) of the aggregate principal amount of Outstanding Bonds.
The rights and obligations of the Trustee under this Section are subject to the
approval of a court of competent jurisdiction in the premises.
Section 11.05. Successor Trustee. Any corporation, association or agency
into which the Trustee may be converted or merged, or with which it may be
consolidated, or to which it may sell or transfer its trust business and assets as a
whole or substantially as a whole, or any corporation or association resulting from
any such conversion, sale, merger, consolidation or transfer to which it is a party,
ipso facto, shall be and become successor trustee and paying agent under this
Indenture and vested with all of the title to the Trust Estate, and all the trusts,
powers, discretion, immunities, privileges and all other matters as was its
predecessor, without the execution or filing of any instrument or any further act,
deed or conveyance on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 11.06. Resignation by Trustee. The Trustee and any successor
trustee may at any time resign from the trusts hereby created by giving thirty (30)
days written notice to the Issuer and to the Company and by first class mail to each
Holder of Bonds as shown on the Bond Register, and such resignation shall take
effect upon the appointment of a successor trustee by the Holders or by the Issuer.
Such notice to the Issuer and the Company may be served personally or sent by
registered mail.
Section 11.07. Removal of Trustee. The Trustee may be removed at any time
by an instrument or concurrent instruments in writing delivered to the Trustee, to
the Company, the Bank and to the Issuer, and signed by the Holders of a majority
in aggregate principal amount of then Outstanding Bonds. Such removal shall only
take effect upon the appointment of a successor trustee.
Section 11.08. Appointment of Successor Trustee. In case the Trustee or
hereunder shall resign or be removed, or be dissolved or shall be in course of
dissolution or liquidation, or otherwise become incapable of acting hereunder, or in
case it shall be taken under the control of any public officer or officers, or of a
BLP84953 Indenture of Trust
RC125-96 60 First Draft - March 20, 1995
receiver appointed by a court, a successor may be appointed by the Holders of a
majority in aggregate principal amount of the then Outstanding Bonds, by an
instrument or concurrent instruments in writing sign,--d by such Holders, or by their
attorney-in-fact, duly authorized. Nevertheless, in case of such vacancy the Issuer
by resolution of its governing body may appoint a temporary trustee or the letter of
credit custodian to fill such vacancy until a successor trustee or letter of credit
custodian shall be appointed by the Holders in the manner above provided; and any
such temporary trustee so appointed by the Issuer shall immediately and without
further act be superseded by the trustee so appointed by such Holders. Every such
Trustee appointed pursuant to the provisions of this Section 11.08 shall be approved
by the Bank and shall be a trust company or bank having trust powers and having
a reported capital and surplus not less than $25,000,000, if there be such an
institution willing, qualified and able to accept the trust upon reasonable or
customary terms.
Section 11.09. Acceptance by Successor Trustees. Every successor Trustee
appointed hereunder shall execute, acknowledge. and deliver to its predecessor, to
the Company and also to the Issuer, an instrument in writing accepting such
appointment hereunder, and thereupon such successor, without any further act,
deed or conveyance shall become fully vested with all the estates, properties,
rights, powers, trusts, duties and obligations of its predecessors as Trustee and
Paying Agent; but such predecessor shall, nevertheless, on the written request of
the Issuer, or of its successor Trustee, execute and deliver an instrument
transferring to such successor Trustee all the estates, properties, rights, powers
and trusts of such predecessor hereunder, and every predecessor Trustee shall
deliver all securities and moneys held by it as Trustee hereunder to its successor.
Should any instrument in writing from the Issuer be required by any successor
Trustee for more fully and certainly vesting in such successor the estates, rights,
powers and duties hereby vested or intended to be vested in the predecessor
trustee, any and all such instruments in writing shall, on request, be executed,
acknowledged and delivered by the Issuer. The resignation of any Trustee and the
instrument or instruments removing any Trustee and appointing a successor
hereunder, together with all other instruments provided for in this Article, shall be
forthwith filed or recorded or both by the successor Trustee in each recording office
where the Indenture shall have been filed or recorded or both.
Section 11.10. Right of Trustee to Pay Taxes and other Charges. If any tax,
assessment or governmental or other charge upon any part of the Trust Estate is not
paid as. required herein, the Trustee may pay such tax, assessment or charge,
without prejudice, however, to any rights of the Trustee or the Bondholders
hereunder arising in consequence of such failure; and any amount at any time so
paid under this Section, or under the Loan Agreement, with interest thereon (to the
extent permitted by law) from the date of such payment until paid to the Trustee in
full at a rate per annum equal to the Prime Rate, shall become so much additional
indebtedness secured hereby, and the same shall be given a preference in payment
over the principal of and the interest on, the Bonds and shall be paid out of the
revenues and receipts from the Trust Estate, if not otherwise caused to be paid;
provided, however, that payments of any such tax, assessment or charge shall not
have any such preference with respect to and shall not be paid from any proceeds
from the Remarketing of the Bonds by the Remarketing Agent pursuant to Section
4.04 hereof . The Trustee shall not be under an obligation to make any such payment
unless it shall have been requested to do so by the Holders of at least 25% in
principal amount of the Bonds then Outstanding and shall have been provided with
sufficient moneys for the purpose of making such payment.
BLP84953 Indenture of Trust
RC125-94 61 First Draft - March 20, 1995
Section 11.11. Trustee Protected in Relying Upon Resolutions. The
resolutions, orders, requisitions, opinions, certificates and other instruments
provided for in this Indenture may be accepted Ly the Trustee as conclusive
evidence of the facts and conclusions stated therein and shall be full warrant,
protection and authority to the Trustee.
Section '11.12. Successor Trustee as Custodian of Bond Fund and Paying
Agent. In event of a change in the office of Trustee the predecessor trustee which
has resigned or been removed shall cease to be custodian of the funds prescribed in
Article. Five and shall cease to act as the Paying Agent for principal and interest on
the Bonds, and the successor trustee shall be and become such custodian and Paying
Agent.
Section 11.13. Co-Trustee. At any time or times, for the purpose of meeting
any legal requirements of any jurisdiction in which any part of the Trust Estate may
at the time be located, the Issuer and the Trustee shall have the power to appoint,
and, upon the request of the Trustee or of the Holders of at least fifty-one percent
(51%) in aggregate principal amount of the then Outstanding Bonds, the Issuer shall
for such purpose join with the Trustee in the execution, delivery and performance
of all instruments and agreements necessary or proper to appoint one or more
persons approved by the Trustee either to act as co-trustee or co-trustees, jointly
with the Trustee, of all or any part of the Trust Estate, or to act as separate trustee
or separate trustees of all or any part of the Trust Estate, and to vest in such
person or persons, in such capacity, such right to the Trust Estate or any part
thereof, and such rights, powers, duties, trusts or obligations as the Issuer and the
Trustee may consider necessary or desirable subject to the remaining provisions of
this Section 11.13.
If the Issuer shall not have joined in such appointment within fifteen (15) days
after the receipt by it of a request so to do, or in case an Event of Default shall have
occurred and be continuing, the Trustee alone shall have power to make such
appointment.
The Issuer shall execute, acknowledge and deliver all such instruments as may
be required by any such co-trustee or separate trustee for more fully confirming
such. title, rights, powers, trusts, duties and obligations to such co-trustee or
separate trustee.
Every co-trustee or separate trustee shall, to the extent permitted by law but
to such extent only, be appointed subject to the following terms, namely:
(1) The Bonds shall be authenticated and delivered, and all rights,
powers, trusts, duties and obligations by this Indenture conferred upon the
Trustee in respect of the custody, control or management of moneys, papers,
securities and other personal property shall be exercised solely by the
Trustee.
(2) All rights, powers, trusts, duties and obligations conferred or
imposed upon the trustees shall be conferred or imposed upon and exercised
or performed by the Trustee, or by the Trustee and such co-trustee or
co-trustees or separate trustee or separate trustees jointly, as shall be
provided in the instrument appointing such co-trustee or co-trustees or
separate trustee or separate trustees,. except to the extent that, under the
law of any jurisdiction in which any particular act or acts are to be performed,
•
•
BLP84953 Indenture of Trust
RC125-94 62 First Draft - March 20, 1995
the Trustee shall be incompetent or unqualified to perform such act or acts,
in which event such act or acts shall be performed by such co-trustee or
co-trustees or separate trustee or separate trustees.
(3) Any request in writing by the Trustee to any co-trustee or
separate trustee to take or to refrain from taking any action hereunder shall
be sufficient warrant for the taking, or the refraining from taking, of such
action by such co-trustee or separate trustee.
(4) Any co=trustee or separate trustee may delegate to the Trustee
the exercise of any right,' power, -trust, duty or obligation, discretionary or
otherwise.
(5) The Trustee at any time, by an instrument in writing, with the
concurrence of the Issuer, may accept the resignation of or remove any
co-trustee or separate trustee appointed under this Section 11.13, and, in
case of a continuing Event of Default the Trustee shall have power to accept
the resignation of, or remove, any such co-trustee or separate trustee without
the concurrence of the Issuer. Upon the request of the Trustee, the Issuer
shall join with the Trustee in the execution, delivery and performance of all
instruments and agreements necessary or proper to effectuate such
resignation or reft?oval. A successor to any co-trustee or separate trustee so
resigned or removed may be appointed in the manner provided in this Section
11.13.
(6) No trustee hereunder shall be personally liable by reason of any
act or.omission of any other trustee hereunder.
(7) Any demand, request, direction, appointment, removal, notice,
consent, waiver or other action in writing delivered to the Trustee shall be
deemed to have been delivered to each co-trustee or separate trustee.
(8) Any moneys, papers, securities or other items of personal
property received by any such co-trustee or separate trustee hereunder shall
forthwith, so far as may be permitted by law, be turned over to the Trustee.
Upon the acceptance in writing of such appointment by any such co-trustee
or separate trustee, it or he shall be vested with such interest in and to the Trust
Estate or any part thereof, and with such rights, powers, duties or obligations, as
shall be specified in the instrument of appointment jointly with the Trustee (except
insofar as local law makes it necessary for any such co-trustee or separate trustee
to act alone) subject to all the terms of this Indenture. Every such acceptance shall
be filed with the Trustee. Any co-trustee or separate trustee may, at any time by
an instrument in writing, constitute the Trustee its or his attorney-in-fact and
agent, with full power and authority to do all acts and things and to exercise all
discretion on its or his behalf and in its or his name.
In case any co-trustee or separate trustee shall die, become incapable of
acting, resign or be removed, the title to the Trust Estate and all rights, powers,
trusts, duties and obligations of said co-trustee or separate trustee shall, so far as
permitted by law, vest in and be exercised by the Trustee unless and until a
successor co-trustee or separate trustee shall be appointed in the manner herein
provided.
BLPS4953 Indenture of Trust
RC125-94 63 First Draft - March 20, 1995
Section 11. 14. Obligation to Trustee as to Reporting. The Trustee shall, at
the request of the Company, cause to be filed any reports lawfully required by any
public agency to be filed under any applicable security laws and any other reports
lawfully required by any public agency to be filed under the Act or any other
applicable state law. For this purpose the Trustee is entitled to require the
Company to cause to be furnished to the Trustee whatever information is necessary
to comply with-such reporting requirements at the Company's sole expense.
Section 11.15. Successor Paying Agent. The provisions of Sections 11.05
through 11.09 with respect to removal, resignation. and appointment of a successor.
trustee shall be equally applicable to resignation, removal and appointment of a
successor to the Paying Agent. The Trustee shall be eligible for appointment as
successor to the Paying Agent.
Section 11.16. Confirmation of the Trustee.
(1) At any time while Bonds remain Outstanding under this Indenture and
in any of the following circumstances, to the extent permitted by law, to-wit:
(A) The Trustee is in doubt as to whether or not the Indenture or any
Related Document or instrument requires Bondholders' consent or the consent
of the Company, any guarantor, or. the Issuer in connection with any
proposed action;
(B) The Trustee has substantial doubt as to whether its consent to
a proposed action, although authorized, should in the particular
circumstances be given;
(C) The Trustee's consent is sought or deemed necessary in
connection with a proposed action which is not specifically dealt with or
contemplated by the Indenture or any other Related Document, or it is unclear
whether the Indenture or other Related Document is intended to deal with the
proposed action;
(D) There is a disagreement between any of the parties to the
Indenture or any other Related Document as to whether a proposed action may
be taken or is required to be taken:
(E) There appears to be a conflict, ambiguity or inconsistency
between or among the provisions of the Indenture and any other Related
Document other than as provided for in Sections 12.01 and 13.01 hereof;
. (F) There is doubt as to whether or not a proposed action falls within
one of the provisions of Sections 12.01 and 13.01 hereof authorizing such
action without Bondholders' consent;
(G) Bondholders' consent is required by this Indenture or Related
Document but consent cannot be obtained because :
(i) it is not possible to comply with requirements of this
Indenture or any other Related Document as to the notice to be given
to Bondholders with respect to the proposed matter requiring consent,
or
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RC125-94 64 First Draft - March 20, 1995
(ii) if action is to be taken at a meeting of Bondholders, the
requisite number of Bondholders (the quorum) necessary to be present
at a meeting in order for a proposed action to be taken was not present
at such meeting or any adjourned meeting;
(H) The Trustee wishes to depart from the procedures set forth in
Section' 14.03 for purposes of calling or conducting a meeting of the
Bondholders; or in any other eventuality in which it shall be necessary to
determine a question arising under or to construe this Indenture or any other
Related Document, the Trustee may, and upon request of the Issuer, the
Company or the Holders of 25% or more in principal amount of Outstanding.
Bonds shall, proceed in accordance with the provisions of Minnesota Statutes,
Section 501.33 through 501.38, as amended.
. If Bondholder's consent cannot be obtained because of the
circumstances described in (1) (G) above a court of competent jurisdiction may
amend or supplement the Loan Agreement or Indenture or any Related
Document upon a proper showing of the necessity therefor.
(2) In construing and interpreting the Indenture and any other Related
Document, the objective shall always be to ascertain and effectuate the intention of
the parties. So, far as possible and appropriate, and to the extent that it does not
conflict with the provisions of the Indenture or the other Related Documents, the
principles of statutory construction enunciated in Sections 645.16, 645.17, 645.18,
645.19 and 645.20, Minnesota Statutes, as amended, shall be applied in the
interpretation and construction of the Indenture and other Related Documents.
(3) The Trustee or successor Trustee shall not be answerable for actions
taken in compliance with any final order of the court. The Trustee or successor
Trustee shall not be entitled to require an indemnity bond pursuant to Section 11. 01,
Subdivision (11), prior to taking any action directed by final order of the court.
Section 11.17. Remarketing Agent. The Issuer shall, at the direction of the
Company, appoint any successor Remarketing Agent for the Bonds, subject to the
conditions set forth in Section 11.18 hereof . Any successor Remarketing Agent shall
designate to the Trustee its principal office for purposes hereof, which shall be the
office of such. Remarketing Agent. at which all notices and other communications in
connection herewith may be delivered to it, and signify its acceptance of the duties
and obligations imposed upon it hereunder by a written instrument of acceptance
delivered to the Issuer, the Company and the Trustee under which such Remarketing
Agent will agree particularly to use its best efforts to sell any Bond delivered to the
Trustee for purchase pursuant to Article Four or to assist the Company in selling
such Bonds, and (ii) keep books and records with respect to its activities hereunder
available for inspection by the Issuer, and the Trustee and the Company at all
reasonable times.
The Issuer shall cooperate with the Trustee and the Company to cause the
necessary arrangements to be made and to be thereafter continued whereby funds
from the sources specified in Section 6.04 will be made available to pay the purchase
price of Bonds presented at the principal corporate trust office of the Trustee.
Section 11.18. Qualifications of Remarketing Agent; Resignation; Removal.
The Remarketing Agent shall be an institution capable of performing all the duties
imposed upon it by this Indenture. The Remarketing Agent may at any time resign
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RC125-94 65 First Draft - March 20, 1995
and be discharged of the duties and obligations created by this Indenture in
accordance with the provisions of the Remarketing Agreement. The Remarketing
Agent may be removed at any time, at the direction of the Company, in accordance
with the provisions of the Remarketing Agreement.
•
•
BLP84953 Indenture of Trust
RC125-94 66 First Draft - March 20, 1995
ARTICLE TWELVE
• Supplemental Indentures
Section, 12:01. Supplemental Indentures Not Requiring Consent of
Bondholders." The Issuer and the Trustee may, from time to time and at any time,
without the consent of, or notice to, any of the Holders, and when so required by
this Indenture shall, enter into an indenture or indentures supplemental to this
Indenture as. shall not be inconsistent with the terms and provisions hereof (which
supplemental indenture or indentures shall thereafter form a part hereof), so as to
thereby (1) cure any ambiguity or formal defect or omission in this Indenture or in
any supplemental indenture, (2) grant to or confer upon the Trustee for the benefit
of the Holders any additional rights, remedies, powers, authority or security that
may lawfully be granted to or conferred upon the Holders or the Trustee, (3) more
precisely identify the Trust Estate, or any other property which may become a part
of the Trust Estate, (4) subject to the lien and pledge of this Indenture additional
revenues, properties or collateral, (5) evidence the appointment of a separate
trustee or a co-trustee or the succession of a new Trustee and/or Paying Agent
hereunder, (6) modify, eliminate and/or add to the provisions of this Indenture to
such extent as shall be necessary to prevent any interest on the Bonds from
becoming taxable under the Federal income tax laws or to effect the qualification of
this Indenture under the Trust Indenture Act of 1939, as then amended, or under
any similar Federal statute hereafter enacted, and to add to this Indenture such
other provisions as may be expressly permitted by said Trust Indenture Act of 1939,
excluding however the provisions referred to in Section 316(a) (2) of said Trust
Indenture Act of 1939, (7) make any other change which is required by any
provision of this Indenture or which is deemed by the Trustee necessary to reconcile
the Indenture with the Related Documents, or any amendments thereto, or (8) make
any other change which in the judgment of the Trustee is necessary or desirable and
will not materially prejudice any non-consenting Holder of a Bond.
Section 12.02. Supplemental Indentures Requiring Consent of Holders.
Exclusive of supplemental indentures covered by Section 12.01 hereof and subject
to the terms and provisions contained in this Section, and not otherwise, the
Trustee, upon receipt of - an. instrument evidencing the consent to the
below-mentioned supplemental indenture by the Holders of not less than fifty-one
percent (51%) of the aggregate principal amount of the then Outstanding Bonds,
shall join with the Issuer in the execution of such other indenture or indentures
supplemental hereto as shall be deemed necessary and desirable for the purpose of
modifying, altering, amending, adding to or rescinding, in any particular, any of
the terms or provisions contained in this Indenture or in any supplemental
indenture; provided, however, that nothing herein contained shall permit or be
construed as permitting (1) an extension of the maturity of the principal or of the
interest on any Bond issued hereunder, or (2) a reduction in the principal amount
of any Bond or the rate of interest thereon or any premium thereon, or (3) a
privilege or priority of any Bond or Bonds over any other Bond or Bonds except as
may be otherwise expressly provided herein, or (4) a reduction in .the aggregate
principal amount of the Bonds required for consent to such supplemental indenture,
or (5) modifying any of the provisions of this section without the consent of the
Holders of one hundred percent (100%) of the principal amount of all Bonds adversely
affected thereby ("100% Bondholders' Consent").
BLP84953 Indenture of Trust
RC125-94 67 First Draft - March 20, 1995
If at any time the Issuer shall request the Trustee to enter into any such
supplemental indenture for any of the purposes of this Section which does not
require 100% Bondholders' Consent, the Trustee shall, upon being satisfactorily
indemnified with respect to expenses, cause notice of the proposed execution of such
supplemental indenture to be mailed by first class mail, postage prepaid, to the
Holders of the Bonds at the addresses shown on the Bond Register. Such notice
shall briefly set forth the nature of the proposed supplemental indenture and shall
state that copies thereof are on file at the principal office of the Trustee for
inspection by all Bondholders. The Trustee shall not, however, be subject to any
liability to any Bondholder by reason of its failure to mail, such notice to -any
particular Bondholder if notice was generally mailed to Bondholders, and any such
failure shall not affect the validity of such supplemental indenture when consented
to and approved as provided in this Section. If the Holders of not less than
fifty-one percent (51%) in aggregate principal amount of the then Outstanding Bonds
at the time of the execution of any such supplemental indenture shall have consented
to and approved the execution thereof as herein provided, no Holder of any Bond
shall have any right to object to any of the. terms and provisions contained herein
or the operation thereof, or in any manner to question the propriety of the execution
thereof, or to enjoin or restrain the Trustee or the Issuer from executing the same
or from taking any action pursuant to the provisions thereof. Upon the execution
of any such supplemental indenture as in this Section permitted and provided, this
Indenture shall be and is deemed to be modified and amended in accordance
herewith.
Anything herein to the contrary notwithstanding, a supplemental indenture
under this Article Twelve which adversely affects the right of the Company under
the Loan Agreement shall not become effective unless and until the Company shall
have consented (either in writing or by inaction as provided below) to the execution
and delivery of such supplemental indenture. In this regard, the Trustee shall
cause notice of the proposed execution and delivery of any such supplemental
indenture, together with a copy of the proposed supplemental indenture,. to be
mailed by certified or registered mail to the Company at least fifteen (15) days prior
to the proposed date of execution and delivery of any such supplemental indenture.
The Company shall be deemed to have consented to the execution and delivery of any
such supplemental indenture if the Trustee does not receive a letter signed by a
Representative of the Company of protest' or objection thereto on or before 4:30
o'clock P . M . , Central Standard or Central Daylight time, whichever is then in effect,
of the fifteenth day after the mailing of said notice and a copy of the proposed
supplemental indenture to the Company unless such fifteenth day falls on a Sunday
or legal holiday, in which event the letter of objection must be received on the next
succeeding business day.
. Section 12.03. Rights of Trustee. If, in the opinion of the Trustee, any
supplemental indenture provided for in this Article affects the rights, duties or
immunities of the Trustee under this Indenture or otherwise, the Trustee may, in
its discretion, decline to execute such supplemental indenture, except to the extent
that this may be required in the case of a supplemental indenture entered into under
Section 12.01. The Trustee shall be entitled to receive; and shall be fully protected
in relying upon, an opinion of Independent Counsel as conclusive evidence that any
such supplemental indenture conforms to the requirements of this Indenture.
BLP84953 Indenture of Trust
RC125-94 68 First Draft - March 20, 1995
ARTICLE THIRTEEN
Amendments to Agreement and Related Documents
Section 13.01. Amendments Not Requiring Bondholder Consent. The Issuer
and/or the Trustee may, without the consent of or notice to the Bondholders,
consent to any amendment, change or modification of the Related Documents :
(1) which may be required or permitted without Bondholder consent
by the provisions of the Related Documents or this Indenture;
(2) for the purpose of curing any ambiguity or formal defect or
omission;
(3) to reconcile the Related Documents with any amendment or
supplement to the Indenture; or
(4) to effect any other change to the Related Documents which, in the
judgment of the Trustee, will not materially prejudice any non-consenting
Holder of a Bond.
Section 13.02. Amendments Requiring Bondholder Consent. Except for
amendments, changes or modifications as provided in Section 13.01, neither the
Issuer nor the Trustee shall consent to any other amendment, change or modification
of the Related Documents, without the giving of notice and the written approval or
consent of the Holders of not less than fifty-one percent (51%) in aggregate principal
amount of the Bonds then Outstanding given and procured as provided in this
Section; provided that in no event shall such amendment, change or modification
relieve the Company of the obligation under the Related Documents to make when and
as due any payments required for the payment of principal, interest and any
premium due or to become due on the Bonds unless the consent of the Holders of all
Bonds adversely affected thereby is first secured. If at any time the Issuer and the
Company-shall request the consent of the Trustee to any such proposed amendment,
change or modification any Related Documents the Company shall request consent of
the Trustee to any such proposed amendment, change or modification, the Trustee
shall, upon being satisfactorily indemnified with respect to expenses, cause notice
of such proposed amendment, change or modification to be given in the same manner
as provided in Section 12.02 hereof with respect to supplemental indentures. Such
notice shall briefly set forth the nature of such proposed amendment, change or
modification and shall state that copies of the instrument embodying the same are on
file at the principal office of the Trustee for inspection by all Holders. The Trustee
shall not, however, be subject to any liability to any Holder by reason of its failure
to mail such notice to any particular Bondholder if notice was generally mailed to
Bondholders, and any such failure shall not affect the validity of such amendment,
change or modification when consented to and approved as provided in this Section.
If the Holders of not less than fifty-one percent (51%) in aggregate principal amount
of the Bonds then Outstanding at the time of the execution of any such amendment
shall consent to the execution thereof as herein provided, no Holder of any Bond
shall have any right to object to any of the terms and provisions contained therein,
or the operation thereof, or in any manner to question the propriety of the execution
thereof, or to enjoin or restrain the Trustee or the Issuer from executing the same
or from taking any action pursuant to the provisions thereof. Upon the execution
of any such amendment, the affected Related Document shall be deemed to be
BLPS4953 Indenture of Trust
RC125-94 69 First Draft - March 20, 1995
modified and amended in accordance therewith. Nothing in this Section contained
shall permit or be construed as permitting any reduction in the payments required
to be made (i) by Sections 4.02 or 4.03 of the Loan '_lgreement or (ii) permitting a
reduction or change in the Stated Maturities of the Bonds.
•
•
BLP84953 Indenture of Trust
RC125-94 70 First Draft - March 20, 1995
ARTICLE FOURTEEN
Miscellaneous Provisions
Section 14.01. Consent of Holders. Any consent, request, direction,
approval, objection or other instrument required by this Indenture to be signed and
executed by the Holders may be in any number of concurrent writings of similar
tenor and. must be signed or executed by such Holders in person or by agent
appointed in writing. Proof of the execution of any such consent, request,
direction, approval; objection or other instrument or of the writing appointing any
such agent and of the ownership of Bonds, if made in the following manner, shall be
sufficient for any of the purposes of this Indenture, and shall be conclusive in favor
of the Trustee with regard to any action taken by it under such request or other
instrument, namely:
(1) The fact and date of the execution by any Person of any such
writing may be proved by the certificate of any officer in any jurisdiction who
by law has power to take acknowledgements within such jurisdiction that the
Person signing such writing acknowledged before him the execution thereof,
or by an affidavit of any witness to such execution.
(2) The fact of the ownership by any Person of Bonds and the
amounts and numbers of such Bonds, and the date of the holding of the same,
may be proved only by reference to the Bond Register.
Section 14.02. Rights Under Indenture. With the exception of rights herein
expressly conferred, nothing expressed or mentioned in or to be implied from this
Indenture or the Bonds is intended or shall be construed to give any person or
company other than the parties hereto, and the Bondholders, any legal or equitable
right, remedy, or claim under or in respect to this Indenture or any covenants,
conditions and provisions herein contained; this Indenture and all of the covenants,
conditions and provisions hereof being intended to be and being for the sole and
exclusive benefit of the parties hereto and the Holders of the Bonds hereby secured
as herein provided.
Section'14.03. "Meetings of Bondholders.
(1) A meeting of Bondholders may be called at any time and from time to time
pursuant to this Section to facilitate any of the following purposes :
(A) to give any notice to the Issuer, the Company or the Trustee, or
to give any directions to the Trustee, or to consent to the waiving of any
default under this Indenture, or to take any other action authorized to be
taken by the Bondholders under this Indenture;
(B) to remove the Trustee or to appoint a successor trustee pursuant
to Sections 11.07 and 11.08 of this Indenture; .
(C) to consent to the execution of a supplemental indenture pursuant
to Section 12.02 hereof, or to consent to the execution of an amendment,
change or modification of any Related Document pursuant to Section 13.02
hereof; or
BLPS4953 Indenture of Trust
RC125-94 71 First Draft - March 20, 1995
(D) to take any other action authorized to be taken by or on behalf
of the Holders of any specified aggregate principal amount of the Bonds under 10
any other provision of this Indenture or under applicable law.
(2) Meetings of Bondholders may be held at such place or places as the
Trustee or, in. case of its failure to act, the Bondholders calling the meeting, shall
from time to time determine.
(3) The Trustee may at any time call a meeting of Bondholders to be held at
such time and at such place as the Trustee shall determine. Notice of every meeting
of Bondholders setting forth the time and the place of such meeting and in general
terms the action proposed to be taken at such meeting, shall be mailed by first class
mail, postage prepaid, to the Holders of the Bonds at the address shown on the Bond
Register. Any failure of the Trustee to mail such notice to a particular Bondholder,
or any defect therein shall not, however, in any way impair or affect the-validity of
any such meeting if notice was generally mailed to Bondholders. In the event that
the Holders of at least 10% in aggregate principal amount of the Outstanding Bonds
shall have requested the Trustee to call a meeting of the Bondholders by written
request setting forth in reasonable detail the action proposed to be taken at the
meeting, and the Trustee shall not have accomplished the mailing of notice of such
meeting within 20 days after receipt of such request, then such Bondholders may
determine the time and the place for such meeting and may call such meeting to take
any action authorized in paragraph (1) of this Section by giving notice of such
meeting in accordance with the provisions of this paragraph (3).
(4) To be entitled to vote at any meeting of Bondholders, a person shall be
a Holder of one or more Bonds Outstanding, or a person appointed by an instrument
in writing as proxy for a Bondholder by such Bondholder. The only persons who
shall be entitled to be present or to speak at any meeting of Bondholders shall be the
persons entitled to vote at such meeting and their counsel and any representatives
of the Trustee, Company, Issuer, and Bank and their counsel.
(5). Notwithstanding any other provisions of this Indenture, the Trustee
may make such reasonable regulations as it may deem advisable for any meeting of
Bondholders in regard to proof of the ownership of Bonds and of the appointment of
proxies and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the right
to vote, and such other matters concerning the conduct of the meeting as it shall
deem appropriate. Except as otherwise permitted or required by any such
regulations, the ownership of Bonds shall be proved in the manner specified in
Section 14.01 of this Indenture and the appointment of any proxy shall be proved in
the manner specified in said section or by having the signature of the person
executing the proxy witnessed or guaranteed by any bank, banker or trust company
authorized by said Section to certify to the ownership of Bonds:
(A) The Trustee or, if the Bondholders have called the meeting, the
Bondholders shall, by an instrument in writing, appoint a temporary
chairperson of the meeting. A permanent chairperson and a permanent
secretary of the meeting shall be elected by vote of the Holders of a majority
of the Bonds represented at the meeting and entitled to vote.
(B) At any meeting such Bondholder or proxy shall be entitled to one
vote for each $5,000 of principal amount of Outstanding Bonds owned or.
represented by him or her; provided, however, that no vote shall be cast or
BLPS4953 Indenture of Trust
RC125-94 72 First Draft - March 20, 1995
counted at any meeting in respect of any Bond challenged as not Outstanding
and ruled by the chairperson of the meeting to be not Outstanding. The
chairperson of the meeting shall have no right to vote, except as a Bondholder
or proxy.
(C) At any meeting of Bondholders, the presence of persons owning
or representing Bonds in an aggregate principal amount sufficient under the
appropriate provision of this Indenture to take action upon the business for
the transaction of which such meeting was called shall constitute a quorum.
Any meeting of 'Bondholders duly called pursuant to this Section may be
adjourned from time to time by vote of the Holders (or proxies for the Holders)
of a majority of the Bonds represented at the meeting and entitled to vote,
whether or not a quorum shall be present; and the meeting may be held as so
adjourned without further notice.
(6) The vote upon any resolution submitted to any meeting of Bondholders
shall be by written ballots on which shall be subscribed the signatures of the
Bondholders or of their proxies and the number or numbers of the Bonds
outstanding held or represented by them. The permanent chairperson of the
meeting shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the secretary
of the meeting their verified written reports in triplicate of all votes cast at the
meeting. A record, at least in triplicate, of the proceedings of each meeting of
Bondholders shall be prepared by the secretary of the meeting. The original reports
of the inspectors of votes on any vote by ballot taken at such meeting, and affidavits
by one or more persons having knowledge of the facts setting forth a copy of the
. notice of the meeting and showing that said notice was published or mailed as
provided in this Section shall be attached to such record. Each copy shall be signed
and verified by the affidavits of the permanent chairperson and secretary of the
meeting and one such copy shall be delivered to the Issuer, another to the Company
and another to the Trustee to be preserved by the Trustee, which copy shall have
attached thereto the ballots voted at the meeting. Any record so signed and verified
shall be conclusive evidence of the matters therein stated.
(7j At any time prior to the preparation of the record of the meeting in
accordance with the terms of this Section for delivery to the Trustee evidencing the
taking -of any action by the Holders of the percentage in aggregate principal amount
of the Bonds specified in this Indenture in *connection with such action, any Holder
of a Bond the number of which is included in the Bonds, the Holders of which have
consented to such action, may, by filing written notice with the Trustee at its
principal corporate trust office and upon proof of holding as provided in Section
14.01 of this Indenture, revoke such consent so far as it concerns such Bond.
Except as aforesaid, any such consent given by the Holder of any Bond shall be
conclusive and binding upon such Holder and upon all future Holders and owners of
such Bond and of any Bond issued in exchange therefor, upon transfer thereof, or
in lieu thereof, irrespective of whether or not any notation in regard thereto is made
upon such Bond. Any action taken by the Holders of the percentage in aggregate
principal amount of the Bonds specified in this Indenture in connection with such
action shall be conclusively binding upon the Issuer, the Company, the Trustee and
the Holders of all the Bonds.
(8) Nothing in this Section 14.03 is intended to limit or prevent the Trustee
from taking any action permitted under Section 11.16 of this Indenture, including
but not limited to the Trustee's right to apply to a court of competent jurisdiction for
BLP84953 Indenture of Trust
RC125-94 73 First Draft - March 20, 1995
confirmation of appointment, or for instructions in accordance with the provisions
of Minnesota Statutes, Sections 501.33 through 501.38, as amended.
Section 14.04. Severability. If any provision of this Indenture shall be held
or deemed to be or shall, in fact, be inoperative or unenforceable as applied in any
particular case in any jurisdiction or jurisdictions or in all jurisdictions or in all
cases because it conflicts with any provisions of any constitution or statute or rule
of public policy, or for any other reason, such circumstances shall not have the
effect of rendering the provision in question inoperative or unenforceable in any
other case or circumstance, or of rendering any other provisions herein contained
invalid, inoperative or unenforceable to any extent whatever.
The invalidity of any one or more phrases, sentences, clauses or paragraphs
in this Indenture contained shall not affect the remaining portions of this Indenture
or any part thereof.
Section 14.05. Notices. All notices, certificates or other communications
hereunder shall be in writing (except as otherwise expressly provided herein) and
shall be sufficiently given and shall be deemed given when mailed by first class mail,
postage prepaid, with proper address as indicated below. The Issuer, the Company,
the Bondholders and the.Trustee may, by written notice given by each to the others,
designate any address or addresses to which notices, certificates or other
communications to them shall be sent when required as contemplated by this
Indenture. Until otherwise provided by the respective parties, all notices,
certificates and communications to each of them shall be addressed as follows :
To the Issuer: City of Richfield, Minnesota •
6700 Portland Avenue
Richfield, Minnesota 55423-2598
Attn : City Manager
To the Company:
c/o Dominium Management Services, Inc.
3140 Harbor Lane, Suite 102
Minneapolis, Minnesota 55447
Attn : Chief Manager
To the Trustee: First Trust National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Department
To the Remarketing
Agent: Piper Jaffray Inc.
222 South Ninth Street, 15th Floor
Minneapolis, Minnesota 55402
Attn: Head of Municipal Underwriting
Section 14.06. Required Approvals. Consents and approvals required by this
Indenture to be obtained from the Company, the Remarketing Agent, the Issuer or
the Trustee shall be in writing and shall not be unreasonably withheld or delayed.
•
BU84953 Indenture of Trust
RC125-94 74 First Draft - March 20, 1995
Section 14.07. Counterparts. This Indenture maybe simultaneously executed
in several counterparts, each of ,which, shall be an original and all of which shall
constitute but one and the same instrument
Section 14.08. Limitation of Liability of Issuer and its Officers, Employees and
Agents. No covenant, provision or agreement of the Issuer herein or in the Bonds
or in any other document executed by the Issuer in connection with the issuance,
sale and delivery of the Bonds, or any obligation herein or therein imposed upon the
Issuer or breach thereof, shall give rise to a pecuniary liability of the Issuer or a
charge against its general credit or taxing powers -or shall obligate the Issuer
financially in any way except with respect to this Indenture and the application of
revenues therefrom and the proceeds of the Bonds. No failure of the Issuer to
comply with any term, condition, covenant or agreement therein shall subject the
Issuer to liability for any claim for damages, costs or other financial or pecuniary
charges except to the extent that the same can be paid or recovered from this
Agreement or revenues therefrom or proceeds of the Bonds. No execution on any
claim, demand, cause of action or judgment shall be levied upon or collected from the
general credit, general funds or taxing powers of the Issuer. In making the
agreements, provisions and covenants set forth herein, the Issuer has not obligated
itself except with respect to this Agreement and the application of revenues
hereunder as hereinabove provided. The Bonds constitute special obligations of the
Issuer, payable solely from the revenues pledged to the payment thereof pursuant
to this Indenture, and does not now and shall never constitute an indebtedness or
a loan of the credit of the Issuer, or the State of Minnesota or any political
subdivision thereof or a charge against general taxing powers within the meaning of
any constitutional or statutory provision whatsoever. It is further understood and
agreed by the Company in the Loan Agreement and by the Holders that the Issuer
. shall not incur pecuniary liability hereunder nor shall it be liable for any expenses
related hereto, all of which the Company has agreed to pay. If, notwithstanding the
provisions of this Section, the Issuer incurs any expense, or suffers any losses,
claims or damages or incurs any liabilities, the Company has agreed in the Loan
Agreement that it will indemnify and hold harmless the Issuer from the same and to
reimburse the Issuer for any legal or other expenses incurred by the Issuer in
relation thereto, and such covenant to indemnify, hold harmless and reimburse the
Issuer shall survive delivery of and payment for the Bonds. The liability of the
Issuer is further restricted as provided in .the Act.
Section 14.09. -Amounts Remaining-in Funds. Upon expiration or sooner
termination of the Loan Agreement as provided therein and after adequate provision
has been made to discharge the Bonds in accordance with Article Nine and make all
other payments required hereunder and under the Loan Agreement, the Trustee
forthwith shall, pay all remaining amounts in the Funds established in Article Six
hereof to the Company.
•
BLP84953 Indenture of Trust
RC125-94 75 First Draft - March 20, 1995
IN WITNESS WHEREOF, the Issuer has caused this Indenture of Trust to be
signed in its name on its behalf by its Mayor and City Manager, and to evidence its
acceptance of the trusts hereby created the Trustee has caused these presents to
be signed in its name and behalf by its duly authorized officers, all as of the 1st day
of April, 1995.
CITY OF RICHFIELD, MINNESOTA
By
Its Mayor
By
Its City Manager
•
•
BLP64953 Indenture of Trust
RC125-94 76 First Draft - March 20, 1995
FIRST TRUST NATIONAL
ASSOCIATION, As Trustee
By
Its
•
BLP84953 Indenture of Trust
RC125-94 77 First Draft - March 20, 1995
•
0
•
EXHIBIT A
Notice of Mandatory Tender Date
To the Holders of : City of Richfield, Minnesota
Multifamily Housing Revenue Bonds
(Century Court Apartments Project)
Series 1995'
NOTICE IS HEREBY GIVEN, pursuant to the provisions of the Indenture of
Trust (the "Indenture"), dated April 1, 1995, between the City of Richfield,
Minnesota and First Trust National Association, as Trustee, that the above entitled
Bonds will be purchased on (the "Mandatory Tender Date"), at a price
of 100% of the principal amount (the "Purchase Price").
You are hereby instructed to deliver to the Trustee on or before 12:00 noon,
Minneapolis time on the Business Day prior to the Mandatory Tender Date all of your
Bonds for purchase with form of assignment executed in blank. Payment of the
Purchase Price and accrued interest on each Bond shall be made only upon delivery
of such Bond to the Trustee, together with proper instruments of assignment of the
Bond to the Remarketing Agent.
BONDS NOT TENDERED FOR PURCHASE ON THE MANDATORY TENDER DATE
SHALL NEVERTHELESS BE DEEMED TENDERED FOR PURCHASE. HOLDERS OF
BONDS REQUIRED TO BE SURRENDERED FOR PURCHASE ARE NOT ENTITLED TO
HOLD SUCH BONDS OR TO ANY ACCRUAL OF INTEREST THEREON ON OR AFTER
THE MANDATORY TENDER DATE.
If you have any questions with respect to this notice, please contact at
FIRST TRUST NATIONAL
ASSOCIATION, Trustee
By
Its
•
BLP84953
RC125-94
Indenture of Trust
First Draft - March 20, 1995
•
•
0
E
•
LOAN AGREEMENT
BETWEEN
CITY OF RICHFIELD, MINNESOTA
AND
RELATING TO
$19,679,000
MULTIFAMILY HOUSING REVENUE BONDS
(CENTURY COURT APARTMENTS PROJECT)
SERIES 1995
DATED : April 1, 1995
With the exception of certain reserved rights, the interest of the City of Richfield,
Minnesota, in this Loan Agreement has been assigned to First Trust National
Association, in St. Paul, Minnesota.
This instrument was drafted by:
HOLMES & GRAVEN, CHARTERED
470 Pillsbury Center
Minneapolis, Minnesota 55402
BLP84972
RC125-94
Loan Agreement
First Draft - March 20, 1995
•
0
E
TABLE OF CONTENTS
(This Table of Contents is not a part of the Loan Agreement, but is included only for
convenience of reference.)
PAGE
PREAMBLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 1
Definitions, Esh?'bits and Miscellaneous
Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 1.02. Exhibits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.03. Company's Acts . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 1.04. Rules of Interpretation . . . . . . . . . . . . . . . . . . 3
ARTICLE 2
Representations of Issuer and Company
Section 2.01. Representations of the Issuer . . . . . . . . . . . . . . . . . 5
Section 2.02. Representations of the Company . . . . . . . . . . . . . . . 6
ARTICLE 3
Rehabilitation of Project
Section 3.01. Acquisition and Rehabilitation of Project by
Company 9
Section 3.02. Payment of Costs by Company . . . . . . . . . . . . . . . . . 9
Section 3.03. Authorization by Issuer . . . . . . . . . . . . . . . . . . . 10
Section 3.04. Issuance of Bonds . . . . . . . . . . . . . . . . . . . . . . 11
Section 3.05. Disbursements from Project Fund . . . . . . . . . . . . . . 11
Section 3.06. Establishment of Completion Date . . . . . . . . . . . . . . 11
Section 3.07. Intentionally Omitted . . . . . . . . . . . . . . . . . . . . 12
Section 3.08. Enforcement of Contract . . . . . . . . . . . . . . . . . . . 12
ARTICLE 4
The Loan, Basic Payments,
Additional Charges and Additional Financing
Section 4.01. The Loan . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 4.02. Basic Payments . . . . . . . . . . . . . . . . . . . . . . 13
Section 4.03. Basic Payments on Account of the Purchase
Price of Bonds . . . . . . . . . . . . . . . . . . . . . 14
Section 4.04. Additional Charges . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.05. Company's Obligations Unconditional . . . . . . . . . . . . 14
Section 4.06. Assignment of Issuer's Rights . . . . . . . . . . . . . . . 15
Section 4.07. Company's Remedies . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE 5
Project Covenants
Section 5.01. Project Operation and Maintenance . . . ... . . . . . . . . 16
Section 5.02. Sale or Lease of Project . 16
BLPS4972
RC125-94 Loan Agreement
i First Draft - March 20, 1995
Section 5.03. Intentionally Omitted . . . . . . . . . . . . . . . . . . . . . 16
Section 5.04. Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 5.05. Alterations to the Project and -Removal of
Project Equipment . . . . . . . . . . . . . . . . . . . 16
ARTICLE 6
Damage, Destruction and Condemnation
Section 6.01. Damage and Destruction . . . . . ... . . . . . . . . . . . . 17
Section 6:02. Condemnation . . . . . . . . .. . . . . . . . . . . . . 17
ARTICLE 7
Company's Covenants
Section 7.01. Covenant for the Benefit of the Trustee and
Bondholders . . . . . . . . . . . . . . . . . . . 18
Section 7.02. Inspection and Access . . . . . . . . . . . . . . . . . . . . 18
Section 7.03. Annual Statement, Audit, Certificate of
Compliance and Other Reports . . . . . . . . . . . . 18
Section 7.04. Indemnity by Company . . . . . . . . . . . . . . . . . . . . 19
Section 7.05. Status of Company . . . . . . . . . . . . . . . . . . . . . . 20
Section 7.06. Filing of Financing Statements . . . . . . . . . . . . . . . 21
Section 7.07. Assurance of Tax Exemption . . . . . . . . . . . . . . . 21
Section 7.08. Determination of Taxability . . . . . . . . . . . . . . 23
ARTICLE 8
Company's Options
Section 8.01. Assignment and Transfer . . . . . . . . . . . . . . . . . . 25
Section 8.02. Prepayment . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 8.03. Direction of Investments . . . . . . . . . . . . . . . . . . . 25
Section 8.04. Termination of Loan Agreement . . . . . . . . . . . . . . 25
ARTICLE 9
Events of Default and Remedies
Section 9.01. Events. of Default . . . . . 28
Section 9.02. Remedies . . . . . . . . . . 28
Section 9.03. Disposition of Funds . . . . . . . . . . . . . . . . . . . . . 29
Section 9.04. Nonexclusive Remedies . . . . . . . . . . . . . . . . . . . 29
Section 9.05. Attorneys' Fees and Expenses . . . . . . . . . . . . . . . 29
Section 9.06. Effect of Waiver . . . . . . . . . . . . . . . . . . . . . . . 29
Section 9.07. Waiver of Stay or Extension . . . . . . . . . . . . . . . . . 29
Section 9.08. Issuer May File Proofs of Claim . . . . . . . . . . . . . . . 30
Section 9.09. Restoration of Positions . . . . . . . . . . . . . . . . . . . 30
Section 9.10. Suits to Protect the Project . . . . . . . . . . . . . . . . . 30
Section 9.11. Performance by Third Parties . . . . . . . . . . . . . . . . 30
Section 9.12. Exercise of the Issuer's Remedies by
Trustee . . . . . . . . . . . . . . . . . . . . . . 30
Section 9.13. Non-Recourse Obligation . . . . . . . . . . . . . . . . . . 30
•
BLPS4972 Loan Agreement
RC125-96 11 First Draft - March 20, 1995
ARTICLE 10
General Provisions
Section 10.01. Amounts Remaining in Funds . . . . . . . . . . . . . 32
Section 10.02. Notices ..... •••••••••••••••• •••• 32
Section 10.03. Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 10.04:" Severability . . . . . . . . . . . . . . . . . . . . . . . 32
Section 10.05. Amendments, Changes, and Modifications . . . . . . . 33
Section 10.06. Execution Counterparts . . . . . . . . . . . . . . . . . . . 33
Section 10:07. Required Approvals . ... . . . . . . . . . . . . . . . . . . 33
Section 10.08. Limitation on Issuer's Liability . . . . . . . . . . . . 33
Section 10.09. Representations of Company . . . . . . • • • • • • • 33
Section 10.10. Termination . . . . . . . . . . . . . . . . . . . . . . . . 33
TESTIMONIUM
SIGNATURES
EXHIBIT A Legal Description of the Project Premises
EXHIBIT B Definitions from the Indenture
1]
•
BLP84972 Loan Agreement
RC125-94 First Draft - March 20, 1995
•
•
9
0 LOAN AGREEMENT
THIS LOAN AGREEMENT is made and entered into as of the 1st day of April,
1995, by and between the City of Richfield, Minnesota, a Minnesota municipal
corporation (the "Issuer") and a Minnesota limited
partnership (the "Company").
The Issuer and Company, each in consideration of the representations,
covenants and agreements of the other as set forth herein, mutually represent,
covenant and agree as follows :
•
is
ELPS4972 Loan Agreement
RC125-94 1 First Draft - March 20, 1995
ARTICLE 1 0
Definitions, Exhibits and Misce3aneous
Section 1.01: Definitions. In this Agreement, the following terms have the
following meanings, unless the context clearly requires otherwise, and any other
capitalized terms defined in Section 1.01 of the Indenture (attached hereto as Exhibit
B and incorporated herein by reference) shall have the same meanings when used
herein as assigned them in the Indenture unless the context or use thereof indicates
another or different meaning or intent:
Agreement : this Loan Agreement by and between the Issuer and Company,
as the same may from time to time be amended or supplemented as provided herein
and in the Indenture;
Bondholder or Holder: the Person in whose name a Bond is registered in the
Bond Register;
Bond Purchase Agreement: the agreement dated April _, 1995, by and among
the City, the Company and the Underwriter pursuant to which the Underwriter
agrees to purchase the Bonds;
City: City of Richfield, Minnesota;
Completion Date : the date the Company certifies that the acquisition and
rehabilitation of the Facility have been completed;
Credit Facility: a letter of credit, promissory note, insurance policy,
guaranty, mortgage or other form of credit support acceptable to the Remarketing
Agent;
Date of this Agreement: April 1, 1995;
Disbursing Agreement : an agreement to be entered into by the Company, the
Trustee. and the provider of the Credit Facility specifying the conditions for the
disbursement of Bond proceeds to pay Project Costs;
Event of Default: any of the events set forth in Section 9.01 hereof;
Indenture: the Indenture of Trust by and between the Issuer and Trustee,
of even date herewith, as the same may from time to time be amended or
supplemented as therein provided;
Improvements : the improvements constituting "rehabilitation expenditures"
within the meaning of Section 147 (d) (3) of the Code to be made to the Facility;
Issuance Expenses any and all costs and expenses relating to the issuance,
sale and delivery of the Bonds incurred or payable by the Company, including, but
not limited to, Underwriter's discount, remarketing fees and expenses, all fees and
expenses of legal counsel, the Trustee, financial consultants, feasibility consultants
and accountants, any fee to be paid to the Issuer, the cost of preparation and
printing of this Loan Agreement, the Indenture, the Disbursing Agreement, the
Regulatory Agreement, any preliminary and final official statement or offering'
BLPS4972 Loan Agreement
RC125-96 2 First Draft - March 20, 1995
memorandum, the Bonds and all other related closing documents, the costs of rating
. the Bonds, and all other expenses' relating to the issuance, sale and delivery of the
Bonds and any other costs which are treated as "issuance costs" within the meaning
of Section 147(g) of the Code;
Issuer: City of Richfield, Minnesota, and any successor to its functions;
Loan: the loan of Bond proceeds by the Issuer to the Company pursuant to
Section 4.01 hereof ;
Net Bond Proceeds: proceeds of the Bonds, including interest earnings
thereon, less such proceeds of the Bonds, including interest earnings thereon; used
to fund the Reserve Fund;
Project Costs : the cost items enumerated in Section 3.02 hereof ;
?J
Term of this Agreement: the period of time commencing on the Date of this
Agreement and terminating on the date set forth in Section 10.10 or such earlier date
as provided by Sections 7.08 or 8.04, whichever date occurs sooner;
Working Capital EZcpense: any (a) Bond proceeds, including interest thereon,
used to pay interest accruing on the Bonds subsequent to the construction period,
(b) Bond proceeds, including interest thereon used to provide a credit against
current payments of Basic Payments and treated by the Internal Revenue Service as
a working capital expense under Section 144(a) of the Internal Revenue Code, and
(c) Project Costs or other expenses which are paid or reimbursed from Bond
Proceeds, including interest thereon, and which the Internal Revenue Service treats
as a working capital expense or inventory under Section 144(a) of the Internal
Revenue Code.
Section 1.02. Exhibits. The following Exhibits are attached to and by
reference made a part of this Agreement:
(1) Exhibit A : legal description of the Project Premises; and
(2) Exhibit B : definitions from the Indenture.
Section 1.03. Companv's Acts. Where the Company is permitted or required
to do or accomplish any act or thing hereunder, the Company may cause the same to
be done or accomplished by a third party selected by the Company with the same
force and effect as if done or accomplished by the Company.
Section 1.04. Rules of Interpretation.
C
(1) This Agreement shall be interpreted in accordance with and governed
by the laws of the State of Minnesota.
(2) The
import, without
Agreement as a
Agreement.
BLP84972
RC125-96
e words and and words of similar
"herein", "hereof" "hereunder"
reference to any particular section or subdivision, refer to this
whole rather than to any particular section or subdivision of this
3
Loan Agreement
First Draft - March 20, 1995
(3) References in this instrument to any particular article, section or
subdivision hereof are to the designated article, section or subdivision of this
instrument as originally executed.
(4) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles; and
all computations provided for herein shall be made in accordance with generally
accepted accounting principles consistently applied and applied on the same basis as
in prior years.
(5) The Table of Contents and titles of articles and sections herein are for
convenience of reference only and are not a part of this Agreement, and shall not
define or limit the provisions hereof.
(6) Unless the context hereof clearly requires otherwise, the singular shall
include the plural and vice versa and the masculine shall include the feminine and
vice versa.
(7) Articles, sections, subsections and clauses mentioned by number only
are those so numbered which are contained in this Agreement.
(8) For purpo;es of this Agreement and the Indenture, an Act of
Bankruptcy shall be deemed no longer in effect if either (a) the petition initiating
the Act of Bankruptcy is dismissed by order of a court of competent jurisdiction and
no further appeal rights exist from such order or (b) the Company notifies the
Trustee that such a dismissal has occurred.
(9) Any opinion of counsel required hereunder shall be a written opinion of -10
such counsel.
(10) References to the Bonds as "tax exempt" or to the "tax exempt status
of the Bonds" are to the exclusion of interest on the Bonds from gross income
pursuant to Section 103(a) of the Code, irrespective of such forms of taxation as the
alternative minimum tax, environmental tax or branch profits tax on foreign
corporations.
BLPS4972 Loan Agrsemsnt
RC125-94 4 First Draft - March 20, 1995
ARTICLE 2
Representations of Issuer and Company
Section 2.01. Representations of the Issuer. The Issuer makes the following
representations and warranties as the basis for its covenants herein:
(1) The Issuer is a municipal corporation organized and existing
under the laws of the State of Minnesota and is authorized to issue the Bonds
to finance the Project pursuant to the Act;
(2) In authorizing the Project, the Issuer's purpose is, and in its
judgment the effect thereof will be, to promote the public welfare by providing
a multifamily rental housing development within the meaning of the Act and
assisting low and moderate income persons within the City to obtain decent,
safe and sanitary housing at rentals they can afford; and facilitating the
development of rental housing opportunities for residents of the City;
(3) A public hearing on the proposal to finance the Project was called
and held on , 1995, at which time all persons who appeared were
given an opportunity to express their views with respect to the proposal to
undertake and finance the Project;
(4) The City's program for financing the Project was submitted to the
Metropolitan Council as required by the Act;
(5) The issuance and sale of the Bonds, the execution and delivery
of this Agreement, the Indenture, the Regulatory Agreement, the Bond
Purchase Agreement and the performance of all covenants and agreements of
the Issuer contained in this Agreement, the Regulatory Agreement, the Bond
Purchase Agreement and the Indenture and of all other acts and things
required under the Constitution and laws of the State to make this Agreement,
the Indenture and the Bonds valid and binding obligations of the Issuer in
accordance with their terms, are authorized by the Act and have been duly
authorized by resolutions of the governing body of the Issuer adopted at a
meeting thereof duly called and held on , 1995, by the affirmative
vote of not less than a majority of its members;
(6) Under the provisions of the Indenture, the Issuer's interest in
this Agreement and certain payments due hereunder are pledged and assigned
to the Trustee as security for the payment of the principal and purchase price
of, interest, and premium, if any, on the Bonds; and
(7) No public Official of the Issuer has either a direct or indirect
financial interest in this Agreement, nor will any public official either directly
or indirectly benefit financially from this Agreement within the meaning of
Minnesota Statutes, Sections 412.311 and 471.87.
(8) The Issuer has authorized the Company, in accordance with the
provisions of the Act and subject to the terms and conditions set forth in
Article 3 of this Agreement, which terms and conditions the Issuer has deemed
to be necessary and proper, to provide for the acquisition and rehabilitation
of the Project by such means as shall be available to the Company and in the
BLP84972 Loan Agreement
RC125-94 5 First Draft - March 20, 1995
manner determined by the Company, and with or without advertisement for
bids as may be required for the acquisition and rehabilitation of facilities by
the Issuer; and has ratified, confirmed and approved all actions heretofore by
the Company consistent with and in anticipation of such authority;
(9) The Bonds are issued as "qualified residential rental bonds"
within the meaning of Section 142(a) (7) of the Code.
(10) The Issuer has received an allocation of tax exempt bonding
authority for the Bonds pursuant, to Minnesota Statues, Chapter 474A.
Section 2.02. Representations of the Company. The Company makes the
following representations and warranties as the basis for its covenants herein:
(1) The Company is a limited partnership duly organized under the
laws of the State of Minnesota, is duly authorized to conduct its business in
the State of Minnesota, has power to enter into this Agreement, the Bond
Purchase Agreement, the Remarketing Agreement, and the Regulatory
Agreement, and to use the Project for the purpose set forth in this Agreement
and by proper action has authorized the execution and delivery of this
Agreement, the Regulatory Agreement, the Remarketing Agreement, the Bond
Purchase Agreement, and has approved the Indenture;
(2) The execution and delivery of this Agreement, the .Regulatory
Agreement, the Remarketing Agreement, the Bond Purchase Agreement, and
the consummation of the transactions contemplated thereby, and the
fulfillment of the terms and conditions thereof do not and will not conflict with .
or result in a breach of any of the terms or conditions of the partnership
agreement of the Company, any restriction or any agreement or instrument to
which the Company is now a party or by which it is bound or to which any
property of the Company is subject, and do not and will not constitute a
default under any of the foregoing, or cause the Company to be in violation
of any order, decree, statute, rule or regulation of any court or any state or
federal regulatory body having jurisdiction over the Company or its
properties, including the Project, and do not and will not result in the
creation or imposition of any lien, charge or encumbrance of any nature upon
any of the property or assets of the Company contrary to the terms of any
instrument or-agreement to which the Company is a party or by which it is
bound;
(3) The Project will be operated as a multifamily rental housing
development as contemplated by the Act; and subject to the other provisions
of this Agreement, it is presently intended and reasonably expected that the
Company will own and operate the Project on the Project Premises throughout
the Term of this Agreement in the normal conduct of the Company's business;
(4) The Company has obtained or will obtain prior to commencement
of rehabilitation all necessary and material approvals of and licenses, permits,
consents and franchises from federal, state, county, municipal or other
governmental authorities having jurisdiction over the Project to acquire,
rehabilitate and operate the Project and to enter into, execute and perform its
obligations under this Agreement, the Bond Purchase Agreement, the
Regulatory Agreement, and the Remarketing Agreement;
BLP84972 Loan Agreement
RC125-94 6 First Draft - March 20, 1995
(5) The proceeds of the Bonds, together with any other funds to be
contributed to the Project by'the Company or otherwise in accordance with
this Agreement, will be sufficient to pa; the cost of acquiring and
rehabilitating the Project in a manner suitable for operation as a multifamily
housing development as required in Article 3;
(6) The Bonds are issued within the exemption provided under
Section 142(d) of the Code with respect to residential rental property; and
"substantially all" of the proceeds of the Bonds will be used for expenditures
chargeable to the capital account of the Project;
(7) Any Project Costs heretofore incurred by the Company for which
the Company will seek reimbursement from the proceeds of the Bonds were
incurred in anticipation of reimbursement from the proceeds of the Bonds of
the Issuer if such proceeds should become available on terms acceptable to the
Company; and the Company investigated the possibility of such financing
prior to incurring such Project Costs;
(8) The Company is not in the trade or business of selling properties
such as the Project and the Company is acquiring the Project for investment
purposes only or otherwise for use by the Company in its trade or business,
and therefore the Company has no intention, now or in the foreseeable future
to voluntarily sell, surrender or otherwise transfer, in whole or part, its
interest in the Project;
(9) There are no actions, suits, or proceedings pending or, to the
knowledge of the Company, threatened against the Company or any property
of the Company in any court or before any federal, state, municipal or other
governmental agency, which, if decided adversely to the Company, would
have a material adverse effect upon the Company or upon the business or
properties of the Company or upon the validity or enforceability of the
instruments referred to in clause (1), or the ability of the Company to perform
its obligations thereunder; and the Company is not in default with respect to
any order of any court or governmental agency;
(10) The Company is not in default in the payment of the principal of
or interest on any indebtedness for borrowed money nor in default under any
instrument or agreement under and subject to which any indebtedness for
borrowed money has been issued;
(11) The Company has filed all federal and state income tax returns
which, to the knowledge of the Company, are required to be filed and has paid
all taxes shown on said returns and all assessments and governmental charges
received by it to the extent that they have become due;
(12) The Company has reviewed and approved the provisions of the
Indenture;
(13) To the best of the Company's knowledge, no public official of the
Issuer has either a direct or indirect financial interest in this Agreement nor
will any public official either directly or indirectly benefit financially from this
Agreement within the meaning of Minnesota Statutes, Section 471.87;
BLP84972 Loan Agreement
RC125-94 7 First Draft - March 20, 1995
(14) No other obligations have been or will be issued under Section 103
of the Code which are sold at substantially the same time as the Bonds,
pursuant to the same plan of financing, which are reasonably expected to be
paid out of substantially the same source of funds as the Bonds.
(15) - The Project is and will continue to be eligible for low income
housing tax credits under Section 42 of the Code .
•
•
BLP84972 Loan Agreement
RC125-94 8 First Draft - March 20, 1995
ARTICLE 3
Rehabilitation of Project
Section 3.01. Acquisition and Rehabilitation of Project by Company. In
connection with the acquisition and rehabilitation of the Project, the Company
represents and covenants that it will acquire the Project and will cause the
Improvements to be made to the Facility in an aggregate amount not less .than
$1,125, 000, and all such expenditures will be incurred not later than the date which
is two years after the Project is acquired by the Company.
Section 3.02. Payment of Costs by Company. The Company agrees that it will
provide any and all money required for the prompt and full payment of all sums
required to complete the Project, including all of the following items which the Issuer
agrees will be reimbursable from Bond proceeds from and to the extent and in the
manner provided in Sections 3.05 and 3.06 and subject to the provisions of the Act
and the Code :
(1) all expenses incurred and to be incurred in connection with the
acquisition and rehabilitation of the Project, including but not limited to cost
of acquiring the Project, the contract price of all labor, services, materials,
supplies and equipment furnished under any contract for rehabilitation of the
Project or otherwise incurred in connection therewith, including the cost of
all rights-of-way for access and utility connections to and from the Project,
and all fees required for recording all financing statements and any title
documents relating to the Indenture, or Regulatory Agreement;
(2) the expense of preparation of the plans and specifications for the
Improvements, including utilities, and all other facilities necessary or
desirable in connection therewith, and all other architectural, engineering
and supervisory services incurred and to be incurred in the planning,
construction and completion of the Improvements;
(3) all legal (including Bond Counsel and counsel to the Issuer,
Company, Original Purchaser, and Trustee), abstractors', financial and
accounting fees and expenses, administrative and rating agency fees (if any),
printing and engraving costs and other expenses incurred and to be incurred
on or before or in connection with the Completion Date with respect to (i) the
establishment of title to the Project Premises, (ii) the authorization, sale and
issuance of the Bonds, (iii) the preparation of this Agreement, the
Remarketing Agreement, the Indenture, the Regulatory Agreement, and all
other documents necessary to the Bond Closing or required by this Agreement
or the Indenture, or (iv) the establishment of the Completion Date, including
compliance with any governmental or administrative rules or regulations on or
before such date; provided that not more than $150, 000 may be disbursed from
Bond proceeds in payment or reimbursement of any of the foregoing which
constitute Issuance Expenses;
(4) all expenses incurred in seeking to enforce any remedy against
any contractor, or any subcontractor or any supplier in respect of any default
under any contract with such Person;
BLPS4972 Loan Agreement
RC125-94 9 First Draft - March 20, 1995
(5) all deed taxes, mortgage registry taxes, recording fees and other
taxes, charges and assessments and license and registration fees of every
nature whatsoever incurred and to be incurred in connection with acquisition
or completion of the Project including the financing thereof;
(6) the cost of all other labor, services, materials, supplies and
equipment necessary to complete the construction, acquisition and installation
of the Improvements;
(7) without limitation by the foregoing, all other expenses which
under generally accepted accounting practice constitute necessary capital
expenditures for the completion of the Project or issuance of the Bonds, not
including working capital or expendable supplies (all of which are
nevertheless to be supplied by the Company from its own funds without
reimbursement); provided that not more than $150,000 may be disbursed from
Bond proceeds in payment or reimbursement of any of the foregoing which
constitute Issuance Expenses; and
(8) all advances, payments and expenditures made or to be made by
the Issuer, the Trustee and any other person with respect to any of the
foregoing expenses; provided that not more than $150,000 may be disbursed
from Bond proceeds in payment or reimbursement of any of the foregoing
which constitute Issuance Expenses;.
The Company shall be solely responsible for paying all such Project Costs until
the Conversion Date. Thereafter all Project Costs may be paid or reimbursed from
available monies in the Project Fund to the extent and in the manner permitted in
Sections 3.05 and 3.06. If, however, such monies are insufficient to pay in full
Project Costs payable therefrom or are otherwise unavailable to pay any Project
Costs, the Company shall nevertheless promptly pay so much of such Costs as may
be in excess of such available monies in the Project Fund or shall, at the request of
the Trustee, forthwith pay over to the Trustee such monies as are necessary to pay
such Project Costs. The Company shall not by reason of the payment of such excess
Project Costs be entitled to any reimbursement from the Issuer in excess of any
monies available therefor in the Project Fund or for any abatement or diminution of
the Basic Payments or Additional Charges.
Section 3.03. Authorization by Issuer. In accordance with the Act, the
Company is authorized by the Issuer, and the Company, pursuant to such
authorization, agrees:
(1) to acquire and rehabilitate the Project as provided in Section
3.01, upon the Project Premises;
(2) to make, execute, acknowledge and deliver any contracts,
orders, receipts, writings and instructions, with any other Persons, and in
general to do all things which may be requisite or proper for acquiring,
constructing and installing the Project;
(3) pursuant to the provisions of this Agreement, to pay all fees,
costs and expenses incurred in the acquisition, construction and installation
of the Project from funds made available therefor in accordance with this
Agreement or otherwise subject to the right to contest such fees, costs and
expenses;
BLP84972 Loan Agreement
RC125-94 10 First Draft - March 20, 1995
(4) so long as the ` tompariy is not in default under any of the
provisions of this Agreement to exercise all authority hereby conferred, which
is granted and conferred irrevocably to the Completion Date and thereafter
until all activities in connection with the acquisition and rehabilitation of the
Project shall have been completed..
Neither the authorization granted in this Section nor any other provision of
this Agreement shall be construed as making the Company an agent or joint venturer
with the Issuer.
Section 3.04: Issuance of Bonds. The Issuer has contracted for the sale of
the Bonds authorized by the Indenture, and the Company has and does approve the
terms of the Indenture. Forthwith upon execution of this Agreement, the Bond
Purchase Agreement, the Indenture, the Remarketing Agreement, the Regulatory
Agreement and all other documents required to be executed by the aforementioned
documents, or as soon thereafter as practicable, the Issuer will execute the Bonds
and cause them to be authenticated by the Trustee and delivered to the Underwriter
upon payment of the purchase price and filing with the Trustee of the opinion of
Bond Counsel as to the legality of the Bonds and the furnishing of all other
documents required by this Agreement, the Remarketing Agreement, the Bond
Purchase Agreement and the Indenture to be furnished before delivery. The Issuer
will then cause the proceeds of the Bonds to be transmitted to the Trustee, who is
required by the Indenture to deposit the same in the Project Fund .
If for any reason such documents are not furnished and the approving opinion
of Bond Counsel in customary form cannot be obtained, then this Agreement shall be
terminated and be void and of no effect and the Company shall be obligated to pay
all costs and expenses enumerated in Section 3.02 and incurred on or before the date
of such termination.
Section 3.05. Disbursements from Project Fund.
(1) Prior to the Conversion Date and the delivery of the documents required
by paragraph (2) hereof, no moneys shall be disbursed from the Project Fund,
except for interest earnings on the Bond proceeds held therein which shall be
transferred to. the Bond Fund on or prior to each Variable Rate Interest Payment
Date and applied as a credit against Basic Payments.
(2) The Issuer has in the Indenture authorized and directed the Trustee to
disburse money from the Project Fund on and after the Conversion Date, subject to
the Disbursing Agreement, to or upon the order of the Company, in payment or
reimbursement of all items of Cost enumerated in Section 3.02 and certified, in
writing by the Company Representative, provided that in no event shall any Bond
proceeds be disbursed until the Conversion Date and until Company has delivered
the Credit Facility to the Trustee.
Section 3.06. Establishment of Completion Date. On the Completion Date any
balance remaining in the Project Fund in excess of the amount retained therein
pursuant to the Disbursing Agreement shall be disbursed by the Trustee to the
Company or its order in such amount as may be necessary (and all thereof shall be
disbursed if necessary) to pay, or to reimburse to the Company for the payment of,
any part of the Project Costs which have not theretofore been paid by the Company
or has not theretofore been reimbursed to the Company, as the case may be; in
accordance with the provisions of Section 3.05. Any balance remaining in the Project
BLP84972 Loan Agreement
RC125-94 1 1 First Draft - March 20, 1995
Fund in excess of any amount retained therein to secure completion by any
contractor shall be transferred by the Trustee to the Bond Fund.
Section 3.07. Intentionally Omitted.
Section 3.08. Enforcement of Contract. Subject to the Disbursing Agreement,
in the event of default of any contractor or subcontractor under any construction
contract or in the event of a breach. of warranty with respect to any materials,
workmanship or performance, the Company will promptly proceed, either separately
or in conjunction with others, to - exhaust its remedies against the contractor,
subcontractor or vendor in default and against any surety on a bond securing the
performance. of such contract, provided, however, that the Company may on the
advice of its counsel and with the Trustee's consent refrain from exhausting such
remedies if determined by the Company not to be in its best interests and not
necessary to complete the Project. The Company will promptly advise the Trustee
of the steps it intends to take in connection with any such default. Any amounts
recovered pursuant to any bond or by way of damages, refunds, adjustments or
otherwise in connection with the foregoing, after deduction of expenses incurred in
such recovery, other than any amounts resulting from the loss of income, shall be
paid into the Project Fund if received before the Completion Date, and otherwise
shall be paid into the Bond Fund, provided that the Company may obtain
reimbursement for any payments made by the Company in connection with such action
as an item of Project Cost as provided in Section 3.05.
•
•
BLP84972 Loan Agreement
RC125-94 12 First Draft - March 20, 1995
ARTICLE 4
The Loan, Basic Payments,
Additional Charges and Additional Financing
Section 4.01. The Loan. The Issuer agrees, upon the terms and conditions
herein specified, to lend to the Company the proceeds received by the Issuer from
the sale of the Bonds, excluding any accrued interest, by causing such proceeds to
be deposited with' the Trustee for disposition as provided herein and in the
Indenture. The amount of the Loan shall be deemed to include any "discount" or any
other amount by which the aggregate price at which the Issuer sells the Bonds to the
Underwriter is less than the aggregate principal amount of the Bonds, plus accrued
interest; and the obligation of the Issuer to make the Loan shall be deemed fully
discharged upon so depositing the proceeds of the Bonds with the Trustee.
Section 4.02. Basic Payments. Subject to the Company's right of prepayment
granted in Section 8.02, the Company agrees to repay the Loan in installments of
Basic Payments as follows :
(1) As and for repayment of the Loan the Company shall pay to the
Trustee for the account of the Issuer an amount equal to the aggregate
principal amount of the Bonds Outstanding and, as interest on its obligation
to pay such amount, an amount equal to interest on the Bonds, such amounts
to be paid in installments on the dates, in the amounts and in the manner
provided in this Loan Agreement in order that the Issuer can cause amounts
to be deposited in the Bond Fund for the payment of the principal of,
premium, if any, and interest on the Bonds, whether at maturity, upon
redemption or otherwise as provided in the Indenture;
(2) In any event the sum of the Basic Payments payable under this
Section shall be sufficient to pay all principal, interest and premium, if any,
on the Bonds as such principal, interest and premiums become due, at
maturity, upon redemption, acceleration or otherwise.
. . (3). As provided in Internal Revenue Service Revenue Procedure
79-5, Revenue. Procedure 81-22 and 26 CFR 601.201 (and any subsequent
amendments, modifications or replacements thereof) Restricted Construction
Funds in the Bond Fund shall be used only to prepay Bonds which are subject
to redemption at their earliest call date without penalty or premium or to pay
a pro rata portion of the principal of the Bonds as provided in Section 6.03(2)
of the Indenture.
(4) Except during the continuance of an Event of Default, all
available remaining sums on deposit in the Bond Fund not credited against
currently payable installments of Basic Payments or applied as provided in
Sections 7.08, 8.02 or 8.04 shall be credited against the last installments of
Basic Payments.
(5) In no event shall any purchase of any Bonds made by or on behalf
of the Company result in the discharge of either (i) the Bonds so purchased,
(ii) the obligations under this Section 4.02 to make Basic Payments relating
to the Bonds so purchased, or (iii) the Loan made hereunder to the extent of
BLP84972 Loan Agreement
RC125-94 13 First Draft - March 20, 1995
the Bonds so purchased, unless and to the extent the Bonds so purchased are
surrendered to the Trustee and cancelled. 0
Section 4.03. Basic Payments on Account of the Purchase Price of Bonds.
(1) The Company shall also pay to the Trustee amounts equal to the amounts
to be paid by the Trustee as the purchase price of Bonds pursuant to Section 4.02
of the Indenture, such amounts to be. paid by the Company to the Trustee one day
prior to the dates such payments are to be made pursuant to Section 4.02 of the
Indenture:
Section 4.04. Additional Charges. The Company agrees. to pay, when due,
each and all of the following:
(1) to or upon the order of the Trustee, when due, all reasonable
fees of the Trustee for services rendered under the Indenture and all
reasonable fees and charges of the Paying Agent, registrars, legal counsel,
accountants, engineers, public agencies and others incurred in the
performance on request of the Trustee of services required under the
Indenture for which. the Trustee and such other Persons are entitled to
payment or reimbursement; provided that the Company may, without creating
a default hereunder, contest in good faith the necessity or reasonableness of
any such services, fees or expenses;
(2) the reasonable fees and expenses of the Issuer, including the
fees and expenses of counsel for the Issuer;
(3) an ongoing'Issuer's Fee in an annual amount equal to one-eighth .
percent ( .125%) of the principal amount of the Bonds outstanding payable in
equal installments semi-annually on 1 and 1 of each year;
and
(4) . to the Trustee, the amount of all advances made by the Trustee,
with interest thereon, as provided in Section 5.04.
Section 4.05. Company's Obligations Unconditional. All Basic Payments and
Additional Charges and all other payments required of the Company hereunder shall
be paid without notice or demand and without setoff, counterclaim, or defense for
any reason and without abatement or deduction or defense (except as provided in
Section 8.02). The Company will not suspend or discontinue any such payments,
and will perform and observe all of its other agreements in this Agreement, and,
except as expressly permitted in Sections 7.08 and 8.04, will not terminate this
Agreement for any cause, including but not limited to any acts or circumstances that
may constitute failure of consideration, destruction or damage to the Project or the
Company's business, the taking of the Project or the Company's business by
Condemnation or otherwise, the lawful prohibition of the Company's use of the
Project or the Company's business, the interference with such use by any Person,
the invalidity or unenforceability or lack of due authorization or other infirmity of
this Agreement, the lack of right, power or authority of the Issuer to enter into this
Agreement, eviction by paramount title, commercial frustration of purpose,
bankruptcy or insolvency of the Issuer or Trustee, change in the tax or other laws
or administrative rulings or actions of the United States of America or of the State
or any political subdivision thereof, or failure of the Issuer to perform and observe •
any agreement, whether express or implied, or any duty, liability or obligation
BLP84972 Loan Agrss ntnt
RC125-94 14 First Draft - March 20, 1995
arising out of or connected with this Agreement, or for any other cause whether
similar or dissimilar to the foregoing, any present or future law to the contrary
notwithstanding, it being the intention of the parties hereto that the Basic Payments
and other amounts payable by the Company hereunder shall be paid in full when due
without any delay or diminution whatever.
Section.4.06. Assignment of Issuer's Rights. As security for the payment of
the Bonds, the Issuer will pledge the amounts payable hereunder and assign.,
without recourse or liability, to the Trustee, the Issuer's rights under this
Agreement, including. the right to receive payments hereunder (except the right to
receive payments, 'if any, under Section 4.04, 7.04 and 9.05 hereof) and hereby
directs the Company to make said payments directly to the Trustee . The Company
herewith assents to such assignment and will make payments under this Agreement
directly to the Trustee without defense or setoff by reason of any dispute between
the Company and the Trustee.
Section 4.07. Company's Remedies. Nothing contained in this Article shall
be construed to release the Issuer from the performance of any of its agreements
herein, and if the Issuer should fail to perform any such agreements, the Company
may institute such action against the Issuer as the Company may deem necessary to
compel such performance so long as such action shall not violate the Company's
agreements in Section 4.04 or diminish or delay the amounts required to be paid by
the Company pursuant to Sections 4.02 and 4.03. The Company acknowledges,
however, and agrees that any pecuniary obligation of the Issuer created by or
arising out of this Agreement shall be payable solely out of the proceeds derived
from this Agreement and the sale of the Bonds.
•
•
BLP84972 Loan Agreement
RC125-94 15 First Draft - March 20, 1995
ARTICLE 5
Project Covenants
Section 5.01. Project Operation and Maintenance. The Company shall pay all
expenses of the operation and maintenance of the Project including, but without
limitation, adequate insurance thereon and insurance against all liability for injury
to Persons or property arising from the operation thereof, and all taxes and special
assessments levied upon or with. respect to the Project and payable during the Term
of this Agreement., all in conformance with and subject to any good faith contest
provisions provided in the Mortgage.
Section 5.02. Sale or Lease of Project. So long as any Bonds are
Outstanding, the Company will not lease the Project (except leases in the normal
course of business), in whole or in part, nor sell, mortgage or otherwise encumber
its interests in the Project, in whole or part, except as provided in Section 8.01;
provided that in no event shall such lease, assignment or sale be permitted if (a) the
effect thereof would be to impair the validity or the exclusion from gross income
under Section 103 of the Code of the interest on the Bonds, or (b) if any such
transaction should release the Company of any of its obligations under this
Agreement (except as otherwise provided in Section 8.01). Before any lease, sale
or assignment, the Company shall deliver to the Trustee an opinion of Bond Counsel,
addressed to the Trustee and in form and substance satisfactory to it, stating in
effect that such lease, sale or assignment will not impair the exclusion from gross
income under Section 103 of the Code of interest on the Bonds. The Company shall
give at least 30 days notice to the Trustee and Issuer of any such sale, assignment
or lease, unless such 30 day notice is waived by the Trustee and the Issuer.
Section 5.03. Intentionally Omitted.
Section 5.04. Advances. The Company acknowledges and agrees that under
the Indenture the Trustee may take certain action and make certain advances
relating to the Project or to certain other matters as expressly provided therein, and
the Company shall be obligated to repay all such advances on demand, with interest
from the date of each such advance, at the rate and under the conditions set forth
in the Indenture..
Section 5.05. Alterations to the Project and Removal of Project Equipment.
The Company shall, have the right from time to time at its cost and expense, to
remodel and make such additions, modifications, alterations, improvements and
changes (collectively referred to as "alterations") in or to the Project or to remove
any equipment therefrom as the Company, in its discretion, may deem to be desirable
for its uses and purposes, provided such alterations or removal do not impair the
character of the Project as a "project" within the meaning of the Act or otherwise
impair the exclusion from gross income under Section 103 of the Code of the interest
on the Bonds.
•
ELPS4972 Loan Agreement
RC125-94 16 First Draft - March 20, 1995
•
r]
C
ARTICLE 6
Damage, Destruction and Condemnation
Section 6.01. DamaLre and Destruction. If there are any Outstanding Bonds
when the Project is damaged or destroyed by fire or other casualty, the Company
shall either restore the Project to .the extent permitted by the Mortgage and
indenture or, if Section 8.04 of this Agreement is applicable, exercise its option to
prepay the Loan pursuant to said Section.
Section 6.02. Condemnation. If there are any Outstanding Bonds when the
Project or any part thereof is taken by Condemnation, the Company shall either
restore the Project to the extent permitted by the Indenture or, if Section 8.04 of
this Agreement is applicable, exercise its option to prepay the Loan pursuant to said
Section.
BLPS4972
RC125-94
Loan Agreement
17 First Draft - March 20, 1995
ARTICLE 7
Company's Covenant,-
Section 7.01. Covenant for the Benefit of the Trustee and Bondholders. The
Company recognizes the authority of the Issuer to assign its interest in and pledge
moneys receivable under this Agreement (other than certain payments required to
be made to the Issuer under Sections 4.04 (2) , 4.04 (3) , 4.04 (5) , 7.04 and 9.05) to
the Trustee as security for the payment,of the principal and purchase price of and
interest and redemption premiums, if any, on the Bonds, and the payment of all fees
and expenses of the Trustee; and hereby agrees to be bound by, and joins with the
Issuer in the grant of, a security interest to the Trustee in any right and interest
the Company may have in sums held in the Funds described in Article Six of the
Indenture, pursuant to the terms and conditions thereof, to secure payment of the
Bonds. Each of the terms and provisions of this Agreement is a covenant for the use
and benefit of the Trustee and Holders of the Bonds, so long as any thereof shall
remain Outstanding; but upon payment in full of the Bonds in accordance with
Article Nine of the Indenture and of all fees and charges of the Trustee and Paying
Agent, all references in this Agreement to the Bonds, the Holders thereof and the
Trustee shall be ineffective, and neither the Trustee nor the Holders of any of the
Bonds shall thereafter have any rights hereunder, save and except those that shall
have theretofore vested or that arise from provisions hereunder which survive
termination of this Agreement.
9
Section 7.02. Inspection and Access. The Company agrees that the Trustee
and its duly authorized agents shall have the right at all reasonable times to examine
and inspect, and for that purpose to enter upon, the Project Premises, and shall also
have such right of access thereto as may be reasonably necessary to cause the
Project to be properly maintained in accordance with Article 5 in the event of failure
by the Company to perform these obligations.
Section 7.03. Annual Statement, Audit, Certificate of Compliance and Other
Reports.
(1) The Company agrees that it will provide the Trustee and the
Underwriter with any financial statements provided to the issuer of a Credit Facility.
(2) At the time the Company causes to be furnished the annual financial
statements, the Company shall also furnish the Trustee a certificate executed by
Company Representative, declaring that during the same fiscal year covered by the
statements and continuing to the date of execution of the certificate, the Company
has fully complied with the terms and conditions of this Agreement and the
Reimbursement Agreement.
(3) The Company will furnish the Issuer and the Trustee all reports
required pursuant to law and regulations of the Act.
(4) The Company will, and at the request of the Issuer, Trustee or
Remarketing Agent, at the Company's expense, furnish to the Trustee, Remarketing
Agent, and Issuer at such times and in such form as the Issuer, Trustee,
Remarketing Agent, may reasonably require (i) a copy of such other reports
containing such information as is necessary to comply with any lawful reporting or
continuing registration requirements imposed by any agency of the State under the
BLPe4972 Loan Agra smsnt
RC125-94 18 First Draft - March 20, 1995
Act, the Minnesota Blue Sky Laws or any other applicable state law as it now exists
or may hereafter be amended or by any agency of any other state in which the Bonds
have been sold, or (ii) such information as is necessary to comply with federal
securities law.
Section 7.04. Indemnity by Company. The Company will, to the fullest extent
permitted by Jaw, protect, indemnify and save the Issuer, and Trustee and their
officers, agents, and employees and any Person who controls the Issuer or Trustee
within the meaning of the Securities Act of 1933, harmless from and against all
liabilities, losses, damages, reasonable costs, and expenses (including reasonable
attorneys' fees and expenses of _ the Trustee and the Issuer), taxes, causes of
action, suits, claims, demands and judgments of any nature arising from:
(1) except for any gross negligence or willful misconduct, any injury
to or death of any person or damage to property in or upon the Project or
growing out of or connected with the use, non-use, condition or occupancy
of the Project or any part thereof, including any and all acts or operations
relating to the construction or installation of property or improvements. The
foregoing indemnification obligations shall not be limited in any way by any
limitation on the amount or type of damages, compensation or benefits payable
by or for the Company, customers, suppliers or affiliated organizations under
any Workers' Compensation Acts, Disability Benefit Acts or other employee
benefit acts;
(2) violation of any agreement, provision or condition of this
Agreement, except by the Issuer or the Trustee, unless the Issuer or Trustee
acts pursuant to direction of the Company;
(3) violation by the Company of any contract, agreement or
restriction, which shall have existed at the commencement of the Term of this
Agreement or shall have been approved by the Company;
(4) violation .of any law, ordinance, court order or regulation
affecting the Project or a part thereof or the ownership, occupancy or use
thereof;
(5) any statement ' or information relating to the expenditure of the
proceeds of the Bonds contained in the "Arbitrage Certificate" or similar
document furnished by the Company to the Issuer or Trustee which, at the
time made, is misleading, untrue or incorrect in any material respect; and
(6) any untrue statement or alleged untrue statement by the Company
of a material fact contained in the Official Statement or any other offering
material approved by the Company relating to the sale of the Bonds (as from
time to time amended or supplemented) or arising out of or based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading, or failure to properly register or otherwise qualify the sale or
reoffering of the Bonds or failure to comply with any licensing or other law or
regulation which would affect the manner whereby or to whom the Bonds could
be sold.
Promptly after receipt by the Issuer or Trustee or any such other indemnified
person, as the case may be, of notice of the commencement of any action with respect
BLPS4972 Loan Agreement
RC125-94 19 First Draft - March 20, 1995
to which indemnity may be sought against the Company under this Section, such
person will notify the Company in writing of the commencement thereof, and, subject
to the provisions hereinafter stated, the Company shall assume the defense of such
action (including the employment of counsel, who shall be counsel satisfactory to the
Issuer, Trustee or such other person as the case may be, and the payment of
expenses). Insofar as such action shall relate to any alleged liability with respect
to which indemnity may be sought against the Company, the Issuer, Trustee or any
such other indemnified person shall have the right to employ separate counsel in any
such action and to participate in the defense thereof, but the fees and expenses of
such counsel shall .not be at the expense. of the Company unless the employment of
such counsel has been specifically. authorized by the Company. The Company shall
not be liable to indemnify any person for any settlement of any such action effected
without its consent.
The provisions of this Section 7.04 shall survive the payment and discharge
of the Bonds.
Section 7.05. Status of Company. Throughout the Term of this Agreement,
the Company will maintain its existence as a limited partnership organized under the
laws of the State of Minnesota and will not wind up or otherwise dispose of all or
substantially all of its assets; provided that subject to the sale restrictions in section
5.02 and the assignment and transfer conditions in section 8. 01, the Company may,
sell or otherwise transfer to another Person all or substantially all of its assets in its
entirety and thereafter wind up if the transferee Person assumes all of the
obligations of the Company under this Agreement and the Regulatory Agreement by
written instrument delivered to the Issuer and the Trustee. Every such transferee
shall be bound by all of the covenants and agreements of the company herein with
respect to any further sale or transfer.
Upon any change in the identity of its general partner by way of substitution,
sale or otherwise of the Company, the Trustee shall be promptly informed and, if
requested, each and every general partner of the Company as newly constituted
shall deliver to the Trustee for the benefit of the Issuer and Bondholders an
instrument -in form satisfactory to the Trustee affirming the joint and several liability
of all then existing general partners for the obligations of the Company hereunder
for which the general partners remain liable.
'The Issuer and Company agree that, upon any change in the status of the
Company, including a change in the identity of its general partner, so long as the
requirements, restrictions and conditions of Section 5.02, Section 8.01, and the
Regulatory Agreement with respect to such change have been satisfied as provided
therein, the general partner involved shall be discharged from liability hereunder.
The Trustee by execution of the Indenture shall be deemed to have agreed to execute
such documents as may be necessary or desirable to indicate such discharge upon
receipt of evidence satisfactory to said parties that the requirements for this
Section, Section 5.02, Section 8.01 and the Regulatory Agreement have been
satisfied, and provided that no Event of Default under this Agreement shall have
happened and be continuing on the date of the discharge.
The Company shall not effect such transfer or change if the result thereof
would be to violate any sale restrictions set forth in Section 5.02 of this Agreement,
or to subject the interest payable on the Bonds (in the hands of any Person who is
not a "substantial user" of the Project or a "related person") to federal income taxes
under Section 103 of the Code.
BLP84972 Loan Agra nt
RC125-96 20 First Draft - March 20, 1995
Section 7.06. Filing of Financing Statements. The Company agrees that it
will, at its sole expense, file or cause to be filed any financing statements and
continuation statements required or requested by the Trustee to perfect the security
interest granted to the Trustee under • the Indenture in this Agreement and the
payments to be made hereunder..
Section' 7.07. Assurance of Tax Exemption. In order to assure that the
interest on the Bonds shall at all times be excluded from gross income for the
purposes of federal income taxation, the Company represents and covenants with the
Issuer, Trustee and all Holders of the Bonds as follows:
(1) the Company will fulfill all continuing conditions specified in
section 142 of the Code and Regulation 1.103-8(b) promulgated thereunder,
to qualify the Bonds as residential rental property bonds thereunder; and the
Company shall fulfill its obligations under the Regulatory Agreement;
(2) the Company will not use (or permit to be used) the Project or use
or invest (or permit to be used or invested) the proceeds of the Bonds or any
other sums treated as "bond proceeds" under Section 148 of the Code and
applicable federal income tax regulations, including "investment proceeds",
"invested sinking funds" and "replacement proceeds", in such a manner as to
cause the Bonds to be classified "arbitrage bonds" under Section 148 of the
Code or "federally guaranteed obligations" under Section 149(b) of the Code;
(3) at least 95% of Net Bond Proceeds will be used to finance costs
properly chargeable to the capital account of a qualified residential rental
project within the meaning of Section 142(d) and functionally related and
subordinate property thereto;
(4) the Company will incur "rehabilitation expenditures" (as defined
in Section 147 (d) (3) of the Code) with respect to the Facility in an amount
equal to at least 15% of the acquisition cost of the Facility within the later of
2 years from (i) the date the Facility was acquired, or (ii) the date the Bonds
were issued;
(5) the Company has not permitted and will not permit any obligation
or obligations other than the Bonds to be issued within the meaning of Section
103(b) of the Code so as to cause such obligations to become part of the same
"issue of obligations" as the Bonds so as to impair the tax exempt status of the
Bonds;
(6) no portion of the proceeds of the Bonds are to be used to provide
any airplanes, skybox, or other private luxury box, health club facility,
facility primarily used for gambling or liquor store;
(7) no portion of the proceeds of the Bonds will be used to acquire
(a) property to be leased to the government of the United States of America
or to any department, agency or instrumentality of the government of the
United States of America, (b) any property not part of the residential rental
housing portion of the Project, or (c) any private or commercial golf course,
country club, massage parlor, tennis club, skating facility (including roller
skating, skateboard and ice-skating), racquet sports facility (including any
handball or racquetball court), hot tub facility, suntan facility or racetrack;
BLPS4972 Loan Agreement
RC125-94 21 First Draft - March 20, 1995
(8) no portion of the proceeds of the Bonds (including investment
earnings thereon) shall be used (directly or indirectly) for the acquisition of
land (or an interest therein) to be used for fe:ming purposes, and less than
twenty-five percent (25%) of the Bond proceeds (including investment
earnings thereon) shall be used (directly or indirectly) for the acquisition of
land to be used for purposes other than farming purposes;
(9) the Company understands that the code imposes a penalty for
failure to file with the Secretary of the Treasury an annual certification of
compliance with low income occupancy requirements, and if the requirements
for a "qualified residential rental project" are not met, does not allow
deduction for interest paid on the Bonds which accrues during the period
beginning on the first day of the taxable year in which the Project ceases to
meet such requirements and ending on the date the Project again meets such
requirements;
(10) the average maturity of the Bonds does not and will not exceed
120% of the average reasonably expected economic life of the Project within the
meaning of Section 147(b) of the Code;
(11) the Company shall provide the Issuer at Bond Closing with all
information required to satisfy the informational requirements set forth in
Section 149(e) of the Code including the information necessary to complete IRS
Form 8038;
(12) no moneys in the Bond Fund, Project Fund or any other fund held
or created under the Indenture shall be invested in investments which cause
the Bonds to be federally guaranteed within the meaning of Section 149(b) of
the Code. If at any time the moneys in such Funds exceed, within the
meaning of Section 149(b), (i) amounts invested for an initial temporary
period until the moneys are needed for the purpose for which the Bonds were
issued, (ii) investments of a bona fide debt service fund, and (iii)
investments of a reserve which meet the requirement of Section 148 (c) and (d)
of the Code, such excess moneys shall be invested in only those Permitted
Investments or Government Obligations, as otherwise appropriate, which are
(A) obligations issued by the United States Treasury, (B) other investments
permitted under regulations, or (C) obligations which are (a) not issued by,
or guaranteed by, or insured by;' the United States or any agency or
instrumentality thereof or (b) not federally insured deposits or accounts, .all
within the meaning of Section 149 (b) (3) (B) of the Code;
(13) at no time during any Bond Year shall the amount invested in
taxable nonpurpose investments with a yield higher than the Bond yield
exceed 150% of the debt service on the Bonds for the Bond Year, all within the
meaning of Section 148 (d) (3) of the Code; provided, however, that the
Company may take advantage of exemptions to such requirement provided for
the investment of sums for temporary periods;
(14) the Company on behalf of the Issuer shall pay to the United
States, as a rebate, an amount equal to the sum of (i) the excess of (I) the
aggregate amount earned on all nonpurpose investments (other than
investments attributable to an excess described in this clause), over (II) the
amount which would have been earned if all nonpurpose investments were
invested at a rate equal to the yield on the Bonds, plus (ii) any income
BLPS4972 Loan Agreement
RC125-94 22 First Draft - March 20, 1995
attributable to the excess described in clause (i), at the times and in the
amounts required by Section 148(f) of the Code, all within the meaning of
Section 148(f) of the Code. The Company end the Trustee shall maintain
records of the interest rate borne by the Bonds and the investments of the
Project Fund and Bond Fund (and any other fund created under the
Indenture) and earnings thereon in adequate detail to enable the Company to
calculate the amount of any rebate required to be made to the United States at
times and in installments which satisfy Section 148(f) of the Code and the
Regulations, at least once every five (5) years and within sixty (60) days
after the day on which the last of the Bonds is redeemed. Calculations of the
amount to be rebated shall be made at least once every five years (or at such
other times as may be required by Section 148(f) of the Code and the Treasury
Regulations applicable thereto) and the Trustee shall be furnished with such
calculations within sixty (60) days of the time they are made. If the Trustee
is not furnished with such calculations, the Trustee may undertake to have
such calculations made at the expense of the Company. Such calculations shall
be retained until six (6) years after the retirement of the last Bond. The
rebate shall be calculated as provided in Section 148(f) of the Code and
Sections 1.148-0 through 1.148-11 of the Treasury Regulations, including
taking into account the gain or loss on the disposition of nonpurpose
investments but not gross earnings of up to $100,000 on the portion, if any,
of the Bond Fund constituting a bona fide debt service fund. The Company
shall acquire, and shall cause the Trustee to acquire all nonpurpose
investments at their fair market value in arm's length transactions;
(15) the Company will not permit more than two percent of the
proceeds of the Bonds to be expended (or to be used to reimburse any person
for an expenditure) to pay Issuance Expenses as provided by Section 147(g)
of the Code;
(16) neither the Company (nor any "related person" thereto) will
enter into any arrangement, formal or informal, for the Company or such
"related person" to purchase the Bonds; and
(17) the Company will not otherwise use Bond proceeds, including
expenses, earnings thereon, or take, or permit or cause to be taken, any
action that would adversely affect the exclusion from gross income of the
interest on the Bonds, nor otherwise omit to take or cause to be taken any
action necessary to maintain such exclusion from gross income; and, if it
should take or permit, or omit to take or cause to be taken, as appropriate,
any such action, the Company shall take all lawful actions necessary to
rescind or correct such actions or omissions promptly upon having knowledge
thereof.
Section 7.08. Determination of Taxability.
(1) Promptly after the occurrence of a Determination of Taxability, the
Company shall give written notice to the Issuer and Trustee of the Determination of
Taxability and the Company shall provide to the Trustee in immediately available
funds, an amount which when added to the amounts on deposit in the Funds, will
equal the principal amount of all the Unpaid Bonds plus accrued interest thereon to
the Redemption Date, and the Bonds shall be redeemed pursuant to Article Three of
the Indenture.
BLP84972 Loan Agreement
RC125-94 23 First Draft - March 20, 1995
. (2) Upon a Determination of Taxability the Company shall also pay to the
Trustee an amount equal to the Paying Agent's, Trustee's fees, accrued and to
accrue until final payment and redemption of the B -)nds, and all other advances,
fees, costs and expenses reasonably incurred by the Trustee, the Issuer and the
Paying Agent, including Bond Counsel and legal fees.
(3) If this Agreement has not been terminated under Section 8.04 prior to
the Redemption Date for the Bonds,. this Agreement shall be terminated on said
Redemption Date and the closing for the termination of this Agreement shall be
completed otherwise as provided for termination of this Agreement upon exercise of
the Company.'s options under - Section 8.'04.
(4) Neither the Company nor any Holder shall be required to contest or
appeal any notice of deficiency, ruling, decision or legislative enactment which may
give rise to a Determination of Taxability; and the expenses of any such contest or
appeal shall be paid by the party initiating the contest or appeal.
•
•
BLP84972 Loan Agreement
RC125-94 24 First Draft - March 20, 1995
ARTICLE 8
company's options
Section 8.01. Assignment and Transfer. The Company may assign its rights
and obligations under this Agreement and, as an incident thereto, transfer its
interest in the Project without prior consent of the Issuer or the Trustee, but
subject to the provisions of Sections 5.02 and 7.05 hereof.
Section 8.02. Prepayment
(1) The Company shall have the option to direct the Trustee to call for
redemption and prepayment of the Outstanding Bonds in whole or after the
Conversion Date, in part as provided in Section 3.01(a), (c) or (e) of the
Indenture. The Bonds to be redeemed shall be redeemed at a price equal to their
principal amount plus accrued interest set forth in Section 3.01 of the Indenture.
In the event the Bonds are called for redemption in whole or in part, the Company
shall make a Basic Payment as provided in Section 4.02 hereof on such Redemption
Date.
(2) If, after the Company exercises its option to redeem all Bonds, no Bonds
remain Outstanding, the Indenture is discharged, and the Company has satisfied all
of its obligations hereunder, the Trustee and the Issuer shall execute and deliver
to the Company such release and other instruments as the Company reasonably
determines are necessary to terminate this Agreement. All further obligations of the
Company hereunder, except as set forth in Section 10. 10, shall thereupon terminate.
Section 8.03. Direction of Investments. Except during the continuance of an
Event of Default, the Company shall have the right during the Term of this
Agreement to direct the Trustee to invest or reinvest all money held for the credit
of Funds established by Article Five of the Indenture in such securities as are
authorized by law for such funds, subject, however, to the further conditions of
Article Seven of the Indenture and Section 7.07 hereof.
Section 8..04. Termination of Loan Agreement. Except during the continuance
of-ah Event of Default, after the Conversion Date, the Company shall have the option
of terminating this Agreement subject to the following conditions:
. (1) such option may be exercised only if one of the following events
shall have occurred:
(A) if the Project shall have been damaged or destroyed to such
extent that in the reasonable judgment of the Company (i) the Project
cannot reasonably be restored within six (6) months to substantially its
condition immediately preceding such damage or destruction, or (ii) the
Project cannot reasonably be used to carry on the normal operations of
the Company for six (6) months, or (iii) the reasonably estimated cost
of restoration of the Project exceeds twenty percent (20%) of the
original face amount of the Bonds and is also reasonably estimated to
exceed the proceeds of property insurance payable therefor plus any
deductible amount for which the Company is self-insured, provided that
such estimates shall be approved by the Trustee; or
BLP84972 Loan Agreement
RC125-94 25 First Draft - March 20, 1995
(B) if by reason of Condemnation, title shall have been taken
to all or substantially all of the Project or the Project Premises, or so
much thereof that, in the reasonable judgment of the Company, (i) the
Company will be prevented from carrying on its normal operations for
six (6) months, or (ii) the reasonably estimated cost of restoration of
the Project exceeds twenty percent (20%) of the original face amount of
the Bonds and is also reasonably estimated to exceed the proceeds of
the Condemnation award, provided that such estimates shall be
approved by the Bank and Trustee; or
(C) if as a result of any changes in the Constitution of the
State of Minnesota or the Constitution of the United States of America,
or of any legislative or administrative action, whether state or federal,
or of any final decree, judgment or order of any court or administrative
body, whether state or federal, entered after the contest thereof by the
Company in good faith, the agreements contained in this Agreement
shall have become impossible of performance in accordance with the
intent and purposes of the parties as expressed herein, or
unreasonable burdens or excessive liabilities shall have been imposed
upon the Company, including, but not limited to, the imposition of new
state or local ad valorem, property, income or other taxes not imposed
on the date of this Agreement, other than ad valorem taxes upon
privately owned property and for the same general purpose as the
Project and special assessments levied in amounts proportionate to and
not exceeding the benefits of future public improvements to the land
included in the Project;
(2) in any of the events stated in subsection (1), clauses (A)
through (C) above, if the Company determines to exercise its option to
terminate this Agreement it must give written notice to the Issuer and Trustee
of its decision to exercise its option within one hundred twenty (120) days
after such event;
. (3) the Company shall give written notice to the Issuer and Trustee
of its intention to exercise the option, stating therein a termination date not
less than forty-five (45) nor more than ninety (90) days after the date the
notice is mailed, but in no event prior to the date on which all Outstanding
Bonds shall be deemed discharged under Article Nine of the Indenture; and
the Company shall make arrangements satisfactory to the Trustee for the
giving of any notice required for redemption of all of the Outstanding Bonds
on the date on which the Bonds are to be redeemed;
(4) the Company shall make a Basic Payment as provided in Section
4.02 hereof on the Redemption Date;
(5) the Company shall pay to the Trustee at least 5 days prior to the
Discharge Date, an amount equal to the Trustee's and Paying Agent's fees and
expenses under the Indenture, accrued and to accrue until final payment and
redemption of the Bonds and all other advances, fees, costs and expenses
reasonably incurred and to be incurred on or before the termination date by
the Trustee and Paying Agent under the Indenture and by the Issuer under
this Agreement;
s
BLPS4972 Loan Agreement
RC125-94 26 First Draft - March 20, 1995
(6) on the termination date, a closing shall be held at the principal
office of the Trustee, or any other office mutually agreed upon. At the
closing the Issuer and Trustee shall, upon aelmowledgment of receipt of the
sum set forth in subsection (4) above, execute and deliver to the Company
such release and other instruments as the Company reasonably determines are
necessary to terminate this Agreement. All further obligations of the
Company hereunder, except under Sections 7.04, 7.07 and 7.08 and 10.10
shall thereupon terminate; provided, however, that the Company shall also
remain obligated to pay or reimburse the Issuer and Trustee for the payment
of. all other fees, costs and expenses unaccounted for in the sum paid in
accordance with subsection (4) above and reasonably incurred before or
subsequent to such closing in connection with the Bonds.
•
BLP84972 Loan Agreement
RC125-94 27 First Draft - March 20, 1995
ARTICLE 9
Events of Default and Rew dies
Section 9.01. Events of Default. Any one or more of the following events is
an Event of :Default under this Agreement, and the term "Event of Default,"
wherever used herein, means any one of the following events, whatever the reason
for such default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or any
order, rule or. regulation of any administrative or governmental body:
(1) if the Company shall fail to pay any Basic Payments due under
this Agreement and such failure shall continue for ten (10) days;
(2) if the Company shall fail to pay any Additional Charges on or
before the date that the payment is due, and shall continue to be in arrears
for thirty (30) days after mailing of a notice to it and the Bank by the Issuer
or the Trustee that said Additional Charges have not been received on the due
date;
(3) if the Company shall fail to observe and perform or shall breach
any other covenant, condition or agreement on its part under this Agreement
for a period of sixty (60) days after mailing of a notice to it by the Issuer or
the Trustee, stating that it is a "Notice of Default" hereunder and specifying
such default or breach and requesting that it be remedied;
•
(4) if the Company shall be dissolved or liquidated (other than when
a new entity assumes the obligations of the Company under the conditions
permitting such action contained in Section 7.05) ;
(5) if any representation or warranty made by the Company herein,
or by a general partner or Representative of the Company in any document or
certificate furnished the Trustee or the Issuer or the Underwriter in
connection herewith or therewith or pursuant hereto or thereto, shall prove
at any time to be, in any material respect, incorrect or misleading as of the
date made; or
(6) if an event of default occurs and is continuing under the
Indenture or any Related Document.
Section 9.02. Remedies.
(1) Whenever any Event of Default shall have happened and be subsisting
the Trustee may, by written notice to the Company, declare all the Basic Payments
payable for the remainder of the Term of this Agreement (an amount equal to that.
necessary to pay in full all outstanding Bonds and the interest thereon assuming
acceleration of the Bonds under the Indenture and to pay all other indebtedness
thereunder) to be immediately due and payable whereupon the same shall become
immediately due and payable by the Company. The provisions of this Section 9.02
do not limit the application of Section 9.01.
(2) Upon the occurrence of an Event of Default, the Trustee may also take
whatever action at law or in equity may appear necessary or appropriate to collect
BLP84972 Loan Agreement
RC125-94 28 First Draft - March 20, 2995
all sums then due and thereafter to become due, or to enforce performance and
observance of any obligation, agreement, covenant, representation or warranty of
the Company, under this Agreement, or any related instrument; or to otherwise
compensate the Issuer, Trustee or Bondholders for any damages on account of such
Event of Default.
(3) The Issuer (without the prior written consent of the Trustee if the
Trustee is not enforcing the Issuer's. right in a manner to protect the. Issuer or is
otherwise taking action that brings adverse consequences to the Issuer) may' take
whatever action at law or in equity may appear necessary or appropriate to enforce
its rights of indemnification under Section 7.04 and to collect all sums then.due and
thereafter to. become due to the Issuer under Sections 4. 04, 7. 04, 9:05 and 10.08 of
this Agreement. Notwithstanding the foregoing, the Issuer is not precluded from
exercising any of its rights reserved to it as set forth in this Section, even if the
Trustee is exercising the rights of the Issuer hereunder.
Section 9.03. Disposition of Funds. Any amounts collected pursuant to action
taken under Section 9.02 (other than sums collected for the Issuer on account of its
rights to indemnification and certain direct payments to be made to the Issuer under
Sections 4.03, 7.04, and 9.05 which sums shall be paid directly to the Issuer) shall
be applied in accordance with the provisions of the Indenture.
Section 9.04. Nonexclusive Remedies. No remedy herein conferred upon or
reserved to the Issuer or Trustee is intended to be exclusive of any other available
.remedy or remedies, but each and.every such remedy shall be cumulative and shall
be in addition to every other remedy given under this Agreement or now or hereafter
existing at law or in equity or by statute. No delay or omission to exercise any right
or power accruing upon any Event of Default shall impair any such right or power
or shall be construed to be a waiver thereof, but any such right and power may be
exercised from time to time and as often as may be deemed expedient. In order to
entitle the Issuer (or Trustee) to exercise any remedy reserved to it in this Article,
it shall not be necessary to give any notice, other than such notice as may be herein
expressly required or as may be required by law.
Section 9.05. Attorneys' Fees and Expenses. If an Event of Default shall
exist under this Agreement and the Issuer or Trustee should employ attorneys or
incur other expenses for the collection of any amounts due hereunder, or for the
enforcement of performance of any, obligation or agreement on the part of the
Company, the Company will upon demand pay to the Issuer or Trustee the reasonable
fees of such attorneys and such other expenses so incurred.
Section 9.06. Effect of Waiver. In the event any agreement contained in this
Agreement should be breached by either party and thereafter waived by the other
party, such waiver shall be limited to the particular breach so waived and shall not
be deemed to waive any other breach hereunder.
Section 9.07. Waiver of Stay or Extension. The Company covenants (to the
extent that it may lawfully do so) that it will not at any time insist upon, or plead,
or in any manner whatsoever claim or take the benefit or advantage of, any
appraisement, valuation, stay, or extension law wherever enacted, now or at any
time hereafter in force, which may affect the covenants in, or the performance of,
this Agreement; and the Company (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it will
not hinder, delay or impede the execution of any power herein granted to the Issuer
BLP84972 Loan Agreement
RC125-94 29 First Draft - March 20, 1995
or Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
Section 9.08. Issuer May File Proofs of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to the Company or the
property of the Company, the Trustee or the Issuer with the prior consent of the
Trustee, shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(I) to file and prove a claim and to file such other papers or
documents as may be necessary or advisable in order*to have the claims of the
Issuer and Trustee (for themselves and on behalf of Bondholders) (including
any claim for the reasonable compensation, expenses, disbursements and
advances of the Issuer and Trustee, their agents and counsel) allowed in such
judicial proceeding, and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claims, and to distribute the same.
Section 9.09. Restoration of Positions. If the Issuer or Trustee have
instituted any proceeding to enforce any right or remedy under this Agreement, and
such proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Issuer or Trustee, then and in every such case the
Company, Trustee and Issuer shall, subject to any determination in the proceeding,
be restored to the positions they held prior to commencement of such proceedings,
and thereafter all rights and remedies of the Issuer shall continue as though no such
proceeding had been instituted.
Section 9.10. Suits to Protect the Project. If the Company shall fail to do so
after thirty (30) days prior written notice from the Issuer or Trustee, the Issuer
shall have power to institute and to maintain such proceedings as it may deem
expedient to prevent any impairment of the Project or any portion thereof, by any
acts which. may be unlawful or in violation of this Agreement, and such suits and
proceedings as the Issuer may deem expedient to protect its interests in the Project
or any portion thereof, including power to institute and maintain proceedings to
restrain the enforcement of or compliance with any governmental enactment, rule or
order -that may be unconstitutional or otherwise invalid, if the enforcement of, or
compliance with, such enactment, rule or order would impair or adversely affect the
Project or be prejudicial to the interests of the Bondholders.
Section 9.11. Performance by Third Parties. The Issuer may permit third
parties to perform any and all acts or take such action as may be necessary for and
on behalf of the Company to cure any Event of Default hereunder. The acceptance
by Issuer or the Trustee of any such performance by third parties shall not in any
way diminish or absolve the Company of primary liability hereunder.
Section 9.12. Exercise of the Issuer's Remedies by Trustee. Whenever any
Event of Default shall have happened and be subsisting the Trustee may, but except
as otherwise provided in the Indenture shall not be obliged to, exercise any or all
of the rights of the Issuer under this Article 9, without notice to the Issuer.
Section 9.13. Non-Recourse Obligation. It is recognized that the Loan. is a
non-recourse obligation of the Company, that as a result thereof this Agreement is
BLP84972 Loan Agreement
RC125-94 30 First Draft - March 20, 1995
not intended to create any personal liability for the "debt" herein created on account
of the issuance of the Bonds and the obligation of the Company to make Basic
Payments hereunder and that accordingly the remec ies available to the Issuer and
the Trustee upon an Event of Default insofar as they related to the payment of any
Basic Payments are limited to the rights and remedies against such security to secure
the repayment of the Loan as is given the Issuer or the Trustee under the Related
Documents, provided that nothing herein shall be deemed to relieve the Company
from personal liability for the performance of any obligation of the Company
hereunder other than the obligation to make Basic Payments and discharge the Loan.
11
ELP84972 Loan Agra snent
RC125-94 31 First Draft - March 20, 1995
ARTICLE 10 - •
General Provisions
Section 10.01. Amounts Remaining in Funds. Except during the continuance
of an Event of- Default, any amounts remaining in the Funds created under Article
Five of the Indenture upon expiration or earlier termination of this Agreement, as
provided herein, and after adequate provision has been made for payment in full of
the Bonds, in accordance with Article Nine of the Indenture, any Additional Charges
payable to the Trustee and Issuer, including Paying Agent's fees and expenses, and
all other amounts required to be paid under this Agreement, the Indenture, shall,
forthwith be paid to the Company.
Section 10.02. Notices. All notices, certificates or other communications
hereunder shall be in writing (except as otherwise expressly provided herein) and
shall be sufficiently given and shall be deemed given when mailed by first class mail,
postage prepaid, with proper address as indicated below. The Issuer, the Company,
the Remarketing Agent, and Trustee may, by written notice given by each of them
to the others, designate any address or addresses to which notices, certificates or
other communications to them shall be sent when required as contemplated by this
Agreement. Until otherwise provided by the respective parties, all notices,
certificates and communications to each of them shall be addressed as follows :
To the Issuer: City of Richfield, Minnesota
6700 Portland Avenue
Richfield, Minnesota 54423-2598
Attn: City Manager
To the Company:
c/o Dominium Management Services, Inc.
3140 Harbor Lane, Suite 102
Minneapolis, Minnesota 55447
Attn : Chief Manager
To the Trustee: First Trust National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Department
To the Piper Jaffray Inc.
Remarketing Agent: 222 South Ninth Street, 15th Floor
Minneapolis, Minnesota 55402
Attn: Head of Municipal Underwriting
. Section 10.03. Binding Effect. This Agreement shall inure to the benefit of
and shall be binding upon the Issuer and Company and their respective successors
and assigns.
Section 10.04. Severability. In the event any provisions of this Agreement
shall be held invalid or unenforceable by any court of competent jurisdiction, such
holding shall not invalidate or render unenforceable any other provision hereof .
BLPS4972 Loan Agreement
RC125-94 32 First Draft - March 20, 1995
Section 10. 05. Amendments, ChanLres, and Modifications. Except as
• otherwise provided in this Agreement or in the Indenture, subsequent to the
issuance of the Bonds and before the lien of the Indenture is satisfied and
discharged in accordance with its terms, this Agreement may not be effectively
amended, changed, modified, altered or terminated without the written consent of
the Trustee.
Section 10.06. Execution Counterparts. This Agreement may be
simultaneously executed in several counterparts, each of which shall be an original
and all of which shallconstitute but one and the same instrument.
Section 10.07. Required Approvals. Consents and approvals required by this
Agreement to be obtained from the Company, the Issuer or the Trustee shall be in
writing and shall not be unreasonably withheld or delayed.
Section 10.08. Limitation on Issuer's Liability. No agreements or provisions
contained in this Agreement nor any agreement, covenant or undertaking by the
Issuer contained in any document executed by the Issuer in connection with the
Project shall give rise to any pecuniary liability of the Issuer or a charge against its
general credit or taxing powers,, or shall obligate the Issuer financially in any way
except with respect to the Project and the application of revenues therefrom and the
proceeds of the Bonds. No failure of the Issuer to comply with any term, condition,
covenant or agreement herein shall subject the Issuer to liability for any claim for
damages, costs or other financial or pecuniary charge except to the extent that the
same can be paid or recovered from the Project or revenues therefrom or from
proceeds of the Bonds; and no execution of any claim, demand, cause of action or
judgment shall be levied upon or collected from the general credit, general funds or
taxing powers of the Issuer. Nothing herein shall preclude a proper party in
interest from seeking and obtaining specific performance against the Issuer for any
failure to comply with any term, condition, covenant or agreement herein; provided,
that no costs, expenses or other monetary relief shall be recoverable from the Issuer
except as may be payable from the Project or its revenues.
Section 10.09. Representations of Company. All representations made in this
Agreement by the Company are based on the Company's independent investigation
of the facts and law, and accordingly no such representations are made in reliance
upon any representations 'made or legal advice given by the Issuer, its Bond
Counsel, or any of its agents, officers or employees.
Section 10.10. Termination. At any time when no Bonds remain Outstanding
and arrangements satisfactory to the Issuer and Trustee have been made for the
discharge of all liabilities under this Agreement, this Agreement shall terminate. All
obligations of the Company under Sections 7.04, 7.07 and 7.08 shall survive
termination of this Agreement.
•
SLP84972 Loan Agreement
RC125-94 33 First Draft - March 20, 1995
IN WITNESS WHEREOF, the Issuer and the Company have caused this Loan
Agreement to be executed by their duly authorized officers. •
CITY OF RICHFIELD, MINNESOTA
By
Its Mayor
By
Its City Manager
•
•
BLP84972 Loan Agreement
AC125-94 34 First Draft - March 20, 1995
•
By
Its
•
•
BLP84972 Loan Agreement
RC125-96 35 First Draft - March 20, 1995
EXHIBIT A
Legal Description
•
BLPS4972 Loan Agreement
RC125-94 A-1 First Draft - March 20, 1995
•
•
EXHIBIT B
Definitions
BLP84972 Loan Agra smsnt
RC125-94 B-1 First Draft - March 20, 1995
•
REGULATORY AGREEAIENT
among
CITY OF RICHFIELD, MINNESOTA
FIRST TRUST NATIONAL ASSOCIATION
and
•
Dated as of April 1, 1995
This instrument drafted by:
Holmes & Graven, Chartered
470 Pillsbury Center
Minneapolis, MN 55402
(612) 337-9300
BLP84973 Regulatory Agreement
RC125-94 First Draft - March 20, 1995
REGULATORY AGREEMENT
Table of Contents
Page
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
PREAMBLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1. Term of Restrictions . . . . ... . . . . . . . . . . . . . . . . . . . 1
(a) Occupancy Restrictions . . . . . . . . . . . . . . . . . . . 1
(b) Rental Restrictions . . . . . . . . . . . . . . . . . . . . . . . 2
(c) Termination of Restrictions . . . . . . . . . . . . . . ... . . 2
(d) Termination of Agreement . . . . . . . . . . . . . . . . . .2
2. Project Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3. Occupancy Restrictions . . . . . . . . . . . . . . . . . . . . . . . 4
4. Rental Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . . 7
5. Transfer Restrictions . . . . . . . . . . . . . . . . . . . . . . . . . 7
6. Enforcement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
7. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
8. Agent of the Issuer . . . . . . . . . . . . . . . . . . . . . . . . 8
9. Interpretation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
10. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
11. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
12. Notices . . . . . . . . . . . . . . . . . . . . . . . 9
13. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
14. Attorneys' Fees . . . . .. . . . . . . . . . . . . . . . . . . . . . . . 9
15. Agreement Binding . . . . . . . . . . . . . . . . . . . . . . . . . 10
TESTIMONIUM
SIGNATURE S
EXHIBIT A Legal Description
EXHIBIT B Certificate of Tenant's Eligibility
EXHIBIT C Certificate of Continuing Program Compliance
0
BLP84973 Regulatory Agreement
RC125-94 (1) First Draft - March 20, 1995
REGULATORY AGREEMENT
THIS REGULATORY AGREEMENT dated as of April 1, 1995, by and among
a Minnesota limited partnership, and its successors
and assigns (jointly and severally hereinafter called the "Company"), First Trust
National Association, a national banking association (the "Trustee") and the City of
Richfield, Minnesota, a municipal corporation of the State of Minnesota, organized
and existing pursuant to the Constitution and laws of the State of Minnesota (the
"Issuer"),
WITNESSETH:
WHEREAS, the Company proposes to acquire and rehabilitate a 1,140-unit
multifamily rental housing development located within the jurisdiction of the Issuer
on the site described in Exhibit A attached hereto (the "Project") ; and
WHEREAS, the acquisition and rehabilitation of the Project will be financed
from proceeds of the sale of Issuer's Multifamily Housing Revenue Bonds (Century
Court Apartments Project); Series 1995 (the "Bonds") to be issued pursuant to an
Indenture of Trust, dated as of April 1, 1995 between the Issuer and the Trustee
(the "Indenture") ; and
WHEREAS, the proceeds of the Bonds will be loaned to the Company (the
"Loan") pursuant to a Loan Agreement, dated as of April 1, 1995 between the Issuer
and the Company; and
WHEREAS, interest on the Bonds paid to the registered owners of the Bonds
is exempt from federal income tax if the Project continuously complies with Sections
142(d) and 147(d) or any successor provisions of the Internal Revenue Code of
1986, as amended and Treasury Regulations applicable thereto (collectively, the
"Code") ; and
WHEREAS, compliance by the Project with the Law and with Sections 142(d)
and 147(d) or any successor provisions of the Code is in large part within the
control of the Company; and .
WHEREAS, the Issuer is unwilling to provide Bond proceeds to finance the
Project unless the Company shall, by entering into this Regulatory Agreement (this
"Agreement"), consent to be regulated by the Issuer to assure compliance with the
Law and to preserve the tax-exempt status of the Bonds under Sections 142(d) and
147(d) or any successor provision of the Code;
NOW, THEREFORE, in consideration of the mutual premises and covenants
hereinafter set forth, and of other valuable consideration, the Company, the Issuer
and the Trustee agree as follows:
1. Term of Restrictions.
(a) Occupancy Restrictions: The term of the Occupancy Restrictions set
forth in Section 4 of this Agreement shall commence on the first day following the
issuance of the Bonds on which 10% of the units in the Project are first occupied and
shall end on the latest of the following: (i) the date which is 10 years after the later
of the date of issuance of the Bonds or the date on which at least 50% of the units in
BLP84973 Regulatory Agreement
RC125-94 1 First Draft - March 20, 1995
the Project are first occupied; or (ii) the date which is a qualified number of days
after the date on which any of the units in the Project is first occupied; or (iii) the
termination date of any Housing Assistance Payment,- Contract relating to the Project
under Section 8 of the United States Housing Act of 1937, including the initial term
and any renewal thereof.
The term "qualified number of days" means 50% of the total number of days
comprising the term of the Bond with. the longest maturity.
(b.) Rental. Restrictions: The term of the Rental Restrictions set forth in
Section 4 of this Agreement will remain in effect during the longer of (i) the period
during which any of the Bonds remain outstanding; or (ii) the term of the Occupancy
Restrictions set forth in paragraph (a) of this Section 1.
(c) Termination of Restrictions: Notwithstanding the provisions of (a) and
(b) of this Section 1, this Agreement and all other restrictions hereunder shall
terminate upon foreclosure of the Mortgage or transfer of title to the Project by deed
in lieu of foreclosure; in addition, this Agreement and the restrictions hereunder
shall also cease to apply in the event of an involuntary noncompliance caused by
unforeseen events such as fire, seizure, requisition, a change in federal law or an
action of a federal agency after the date of issue of the Bonds which prevents the
Issuer from enforcing the requirements of this Agreement or condemnation or similar
event, provided in all such cases that (i) the Bonds are retired at the first available
call date; or (ii) any insurance proceeds or condemnation award or other amounts
received as a result of such -loss or destruction are used to provide a project which
meets the requirements of Section 142(d) or any successor provision of the Code and
Treasury Regulations Section 1.103-8(b), as amended, or any successor law or
regulation in which case this Agreement shall be automatically reinstated. However,
the foregoing provisions of this paragraph shall cease to apply in the event of
foreclosure, transfer of title by deed in lieu of foreclosure or similar event if, at any
time subsequent to such event and during the period set forth in paragraph (a) of
this Section 1, the obligor on the purpose investment (as defined in Section 1.148-
1(b) of the Treasury Regulations) or a related person (as defined in Section
147(a)(2) obtains an ownership interest in the Project for federal tax purposes.
(d) Termination of Agreement : This Agreement shall terminate upon the
earlier of (i) termination of the Occupancy Restrictions and the Rental Restrictions
as provided in paragraphs (a) and (b) -of this Section 1, or (ii) a termination
pursuant to the provisions of paragraph (c) of this Section 1.
2. Project Restrictions.
(a) The Company represents, warrants and covenants that in order to meet
the requirements of Section 142(d) of the Code and Minnesota Statutes, Section
462C.05:
(i) The Project will be maintained for the purpose of providing
multifamily residential rental property and will constitute multifamily
residential rental property, as such phrase is used in Section 142(a) (7) of the
Code.
(ii) The Project consists of a building or structure or several
proximate buildings or structures which are located on a single tract of land
C7
BLP84973 Regulatory Agreement
RC125-94 2 First Draft - March 20, 1995
or contiguous tracts of land which may include facilities functionally related
and subordinate thereto
(iii) In the event a unit within a building or structure is occupied by
the Company, the building or structure must include no fewer than four units
not occupied by the Company.
(iv) All of the units in the Project will contain complete living,
sleeping, eating, cooking, and sanitation facilities for a single person or a
family.
(v) None of the units in the Project * will at any time be utilized on a
transient basis, or used as a hotel, motel, dormitory, fraternity house,
sorority house, rooming house, hospital, sanitarium or rest home.
(vi) Other than units for a resident manager or maintenance personnel
or units for individuals or families of low or moderate income as provided for
in Section 4(a) hereof, all of the units in the Project will be leased, rented,
or available for lease or rental on a continuous basis to members of the general
public (and may be restricted to elderly persons and families).
(vii) The Company shall not restrict Qualifying Tenants (as
hereinafter defined) from the enjoyment of unrestricted access to all common
facilities and common areas of the Project, except as reasonably necessary to
protect and preserve the health and safety of tenants.
(viii) The Company shall not discriminate on the basis of race, creed,
color, sex, or national origin in the lease, use or occupancy of the Project or
in connection with the employment or application for employment of persons for
the operation and management of the Project.
(ix) None of the proceeds of the Bonds will be used to finance
commercial property.
(x) All tenant lists, applications, and waiting lists relating to the
Project. shall at all times be kept separate and identifiable from any other
business of the Company which is unrelated to the Project, and shall be
maintained in -the State in a reasonable condition for proper audit and subject
to examination during business hours by representatives of the Issuer, the
Trustee or the Bondholders.
(xi) All leases of units to Qualifying Tenants shall contain clauses,
among others, wherein each individual lessee:
(1) Certifies the accuracy of the statements made in its
application and Certification of Tenant Eligibility; and
(2) Agrees that the family income, family composition and other
eligibility requirements at the time the lease is executed shall be deemed
substantial and material obligations of his tenancy; that he will comply
promptly with all requests for income, family composition and other
information relevant to determining low or moderate income status from
the Company, the Issuer or the.Trustee (as hereinafter defined).) and
that his failure or refusal to comply with a request for information with
BLPS4973 Regulatory Agreement
RC125-94 3 First Draft - March 20, 1995
respect thereto shall be deemed a violation of a substantial obligation of
his tenancy . 0
(xii) If the Project includes a rental or management office, such office
shall be used exclusively for the rental or management of the Project.
(b) The Company further represents, warrants and covenants that, in
accordance with the requirements of Minnesota Statutes, Section 474A.047:
(i) The rehabilitation with respect to the Project will meet the
minimum rehabilitation, expenditures in section 42 (e) (2) of the. Internal
Revenue Code;
(ii) The Project involves participation by the Issuer in the financing
of the acquisition of the Project; and
(iii) The Project will be occupied by individuals or families whose
incomes at the time of their initial residency in the Project meet the
reauirements of section 42(c) of the Internal Revenue Code.
(c) The Company further represents, warrants and covenants that, in order
to comply with the requirements of Section 147(d) and applicable regulations :
(1) Within 2 years following the date of acquisition of the Project, the
Company shall cause to be made rehabilitation expenditures with respect to the
building which comprises the Project, in an amount equal to or exceeding 15
percent of the portion of the cost of acquiring such building financed with
proceeds of the Bonds. For this purpose, "rehabilitation expenditures" shall
have the meaning given in Section 147 (d) (3) of the Code.
3. Occupancy Restrictions.
(a) The Company represents, warrants and covenants that in order to meet
the requirements of Section 142(d) of the Code and Minnesota Statutes, Section
462C.05:
(i) At least.foirty percent (40%) of the units in the Project shall be
occupied (or treated as occupied as provided herein) or held vacant and
available for occupancy by Qualifying Tenants and such units will be of
comparable quality and will be a range of sizes and number of bedrooms
comparable to those units which are available to other tenants. Qualifying
Tenants shall mean those persons and families who shall be determined from
time .to time by the Company to be eligible as "individuals whose income is
sixty percent (60%) or less of area median gross income" within the meaning
of Section 142 (d) (2) (B) of the Code in a manner consistent with the method
of determination of lower income families that is, as of the date of issuance of
the Bonds, in effect under the Section 8 Program (or if such program has been
terminated as of the date of issuance of the Bonds, under such program as in
effect immediately prior to such termination). Occupants of a unit are
considered individuals or families of "low or moderate income" only if their
combined adjusted income (computed in the manner prescribed in Section
1.167(k)-3(b)(3) of the Income Tax Regulations as in effect on the date of
issuance of the Bonds and treating all occupants as a single family) does not
exceed sixth percent (60%) of the median gross income for the area with
BLPS4973 Regulatory Agreement
RC125-94 4 First Draft - March 20, 1995
adjustments for smaller and larger families as set forth in Exhibit B hereto.
For purposes of this defution, the occupants of a residential unit shall not
be deemed to be Qualifying Tenants if all the occupants of such residential
unit at any time are "students", as defined in Section 151(c)(4) of the Code,
no one of whom is entitled to file a joint return under Section 6013 of the Code.
The determination of whether an individual or family is of low or moderate
income.•shall be made at the time the tenancy commences and on an ongoing
basis thereafter, determined at least annually. Any unit occupied by an
individual or family who is a Qualifying Tenant at the commencement of
occupancy shall not continue to be treated as if-occupied by a Qualifying
Tenant during their tenancy in such unit if such individual or family
subsequently ceases to be of low or moderate income unless such individual's
or family's income does not exceed 140% of the maximum income qualifying as
low or moderate income for a family of its size. In the event that a unit does
cease to be treated as occupied by a Qualifying Tenant for such reason, and
thereupon less than 40% of the completed units in the Project would not be
occupied by, or held vacant and available for occupancy by, Qualifying
Tenants, the next vacant unit of comparable or smaller size not previously
occupied by a Qualifying Tenant must be rented to a Qualifying Tenant or held
vacant and available for occupancy by a Qualifying Tenant. Any completed
unit vacated by a Qualifying Tenant which results in the Project not being in
compliance with the provisions of this Section must be rented (on other than
a temporary basis) to a Qualifying Tenant before any other units in the
Project are rented to tenants who are not Qualifying Tenants until the Project
is again in compliance.
(ii) As a condition to initial and continuing occupancy, each person
who is intended to be a Qualifying Tenant shall be required annually to sign
and deliver to Company a Certification of Tenant Eligibility substantially in
the form attached as Exhibit B hereto, or in such other form as may be
approved by Bond Counsel (the "Eligibility Certification"), in which the
prospective Qualifying Tenant certifies that he or his family qualifies as being
of low or moderate income. In addition, such person shall be required to
provide whatever other information, documents or certifications are deemed
necessary by the Issuer to substantiate the Eligibility Certification, on an
ongoing annual basis, and to verify that such tenant continues to be a
Qualifying Tenant within the meaning of Section 3(a) hereof.
(iii) The form of lease to be utilized by the Company in renting any
units in the Project to any person who is intended to be a Qualifying Tenant
shall provide for termination of the lease and consent by such person to
immediate eviction for failure to qualify as a Qualifying Tenant as a result of
any material misrepresentation made by such person with respect to the
Eligibility Certification.
(iv) Eligibility Certifications will be maintained on file by the Company.
with respect to each Qualifying Tenant who resides in a Project unit or resided
therein during the immediately preceding calendar year, and the Company
will, within thirty (30) days of the end of each calendar year, file a copy of
each such Eligibility Certification with the Issuer and the Trustee.
(v) On or before the first day of each October, June, September, and
December, the Company will submit to the Issuer and the Trustee a
certificate, substantially in the form of Exhibit C hereto, executed by the
BLPS4973 Regulatory Agreement
RC125-94 5 First Draft - March 20, 1995
Company stating the percentage of units of the Project which were occupied
by Qualifying Tenants at all times during the preceding three months and
identifying Qualifying Tenants who commencec_ or terminated occupancy of the
Project during such three months.
(vi) The Company covenants and agrees that during the term of this
Agreement, it will prepare and submit to the Issuer and the Trustee within
thirty (30) days after each anniversary of the date the Project first becomes
available for occupancy, a report certified to be accurate by the Company (a)
identifying the tenancies and the dates of occupancy (or vacancy) for all
dwelling units in the Project including the percentage of the dwelling units of
the Project which were occupied by Qualified Tenants (or held vacant and
available for occupancy by Qualified Tenants) at all times during the year
preceding the date of such certificate (b) describing all transfers or other
changes in ownership of the Project or any interest therein and (c) stating,
that to the best knowledge of the person executing such certificate after due
inquiry, all units were rented or available for rental on a continuous basis
during such year to members of the general public and that the Company was
not otherwise in default under this Agreement during such year.
(vii) On the first (1st) day of the month which is twelve (12) months
after the Occupancy Restrictions commence, as determined by Section 2(a)
hereof, and each anniversary thereof, the Company shall certify to the United
States Treasury Department that the Project and the tenants thereof comply
with the restrictions set forth in Sections 2 and 3(a) hereof.
(viii) In order to assure compliance with this Section 3, the Company
shall advise the Issuer and the Trustee in writing of the first day on which (i)
the initial residential unit or units in the Project are first occupied, (ii) ten
percent (10%) of the residential units in the Project are first occupied and (iii)
fifty percent (50%) of the residential units in the Project are first occupied.
(ix) The Company will immediately notify the Issuer and the Trustee
at any time the dwelling units in the Project are not occupied or available for
occupancy as provided above.
(x) . The Company will obtain and maintain on file with respect to each
Qualifying Tenant residing in the Project, evidence reasonably satisfactory
to the Issuer and the Trustee as to such Qualifying Tenant's income for the
taxable year immediately preceding such Qualifying Tenant's initial occupancy
in the Project, which may include OMB Form No. 2502-0204, "Certification and
Re-Certification of Tenant Eligibility".
(b) The Company further represents, warrants and covenants that in order
to meet the requirements of Minnesota Statutes, Section 474A.047, for the period
commencing on the date of issuance of the Bonds and ending 15 years later, the.
Project will be occupied by individuals or families whose incomes at the time of their
initial residency in the Project meet the requirements of section 42(g) of the Code.
The Company agrees to certify on or before each 1 during such
period, commencing 1, 199_, to the Issuer that the occupancy
requirements set forth in this clause have been met for the preceding year. Upon
request of the Issuer, the Company agrees to provide individual certifications with
respect to the tenants in the project.
BLP84973 Regulatory Agreement
RC125-94 6 First Draft - March 20, 1995
The Issuer shall monitor compliance with the requirements of this provision
and, in addition to any other remedies provided in this agreement, if the Project is
found by the Issuer to be out of compliance with tLe foregoing requirements, the
Company shall pay a penalty to the Issuer equal to one-half of one percent of the
total amount of the Bonds if the Issuer issues an order of noncompliance. For each
additional year a project is out of compliance, the annual penalty must be increased
as provided in Minnesota Statutes, Section 474A.047, Subd. 3. The imposition of
such penalty shall be subject to the. receipt by the Issuer of an opinion of bond
counsel selected by the Issuer to the effect that the imposition of such penalty shall
not adversely affect the tax-exempt status of interest on the Bonds.
4. Rental Restrictions.
(a) The Company represents, covenants and warrants that once available
for occupancy each unit in the Project will be rented or available for rental to
members of the general public on a continuous basis until the termination of such
requirements, as provided in Section 1(c) hereof.
(b) The rental restrictions imposed by this Section and the occupancy
restrictions of Section 3(a) (i) hereof may be enforced by the Issuer by an action for
specific performance. _
5. Transfer Restrictions. The Company covenants and agrees that the
Company will cause or require as a condition precedent to any conveyance, transfer,
assignment or any other disposition of the Project prior to the termination of the
Rental Restrictions and Occupancy Restrictions provided herein (the "Transfer")
that the transferee of the Project pursuant to the Transfer assume in writing, in a
form acceptable to the Issuer all duties and obligations of the Company under this
Agreement, including this Section 5, in the event of a subsequent Transfer by the
transferee prior to expiration of the Rental Restrictions and Occupancy Restrictions
provided herein (the "Assumption Agreement"). The Company shall deliver the
Assumption Agreement to the Issuer prior to the Transfer.
6. Enforcement.
(a) The Company shall permit any duly authorized representative of the
Issuer or the Trustee -to inspect any books and records of the Company regarding
the Project and with respect to the incomes of Qualifying Tenants which pertain to
compliance with the provisions of this Agreement, the Law and Section 142(d) or any
successor provision of the Code.
(b) The Company shall submit any information, documents or certificates
requested by the Issuer or the Trustee which either of them deem reasonably
necessary to substantiate the Company's continuing compliance with the provisions
of this Agreement, the Law and Section 142(d) or any successor provision of the
Code.
(c) The Issuer, the Trustee and the Company each covenant that it will not
knowingly take or permit any action (other than an action required by any
documents executed in connection with the Loan) that would adversely affect the
exemption from federal income taxation of interest on the Bonds. Moreover, each
covenants to take any lawful action (including amendment of this Agreement as may
be necessary, in the opinion of nationally- recognized bond counsel) to comply fully
with all applicable rules, rulings, policies, procedures, regulations or other official
BLP84973 Regulatory Agreement
RC125-94 7 First Draft - March 20, 1995
statements promulgated or proposed by the Department of the Treasury or the
Internal Revenue Service from time to time pertaining to obligations the interest on
which is tax-exempt under Section 142(d) or any .-iccessor provision of the Code
and affecting the Project.
(d) The Company covenants and agrees to give written notice to the Issuer
of any violation of the Company's obligations hereunder within five (5) days after
first discovering any such violation, and the Issuer covenants and agrees to inform
the Company by written notice of any violation of the Company's obligations
hereunder within five (5) days after first discovering such violation and to provide
the Company a period of time in which to correct such violation. If any such.
violation is not corrected to the satisfaction of the Issuer and the Trustee within the
period of time specified which shall be at least thirty (30) days after the date any
notice to the Company is mailed, or within such further time as the Issuer and the
Trustee determine is necessary to correct the violation without loss of tax exemption
of interest on the Bonds, but not to exceed any limitations set by applicable
regulations, without further notice the Issuer or the Trustee shall declare a default
under this Agreement effective on the date of such declaration of default, and upon
such default the Company hereby agrees to pay the Issuer any rents or other
amounts received by the Company for any units in the Project which were in violation
of this Agreement during the period such violation continued, and the Issuer shall
apply to any court, state or federal, for specific performance of this Agreement or
an injunction against any violation of this Agreement, or any other remedies at law
or in equity or any such other actions as shall be necessary or desirable so as to
correct non-compliance with this Agreement.
(e) The Company, the Trustee and the Issuer each acknowledge that the
primary purpose for requiring compliance by the Company with the restrictions
provided in this Agreement is to comply with the Law and to preserve the federal
income tax exemption of interest on the Bonds to the Bondholders, and that the
Holder of the Bonds, who are declared to be third party beneficiaries of the
Agreement, shall be entitled, for any breach of the provisions hereof, to all remedies
both at law and in equity in the event of any default hereunder.
7. Indemnification. The Company hereby indemnifies, and agrees to
defend and hold harmless, the Issuer from and against all liabilities, losses,
damages, costs, expenses' (including attorneys' fees and expenses), causes of
action, suits, allegations, claims, demands and judgments of any nature arising from
the consequences of a legal or administrative proceeding or action brought against
them, or any of them, on account of any failure by the Company to comply with the
terms of this Regulatory Agreement, or on account of any representation or warranty
of the. Company contained herein being untrue.
8. Agent of the Issuer. The Issuer shall have the right to appoint an
agent to carry out any of its duties and obligations hereunder, and shall inform the
Company of any such agency appointment by written notice. The Issuer hereby
appoints the Trustee as its agent for such purpose, and this shall constitute written
notice to the Company of such appointment.
9. Interpretation. Any terms not defined in this Agreement shall have the
same meaning as terms defined in the Indenture or in the Law or in Section 142(d)
of the Code and Treasury Regulations applicable thereto.
BLP84973 Regulatory Agreement
RC125-94 8 First Draft - March 20, 1995
10. Amendment. It is agreed that the parties hereto shall promptly amend
this Agreement (in a form suitable `for recording) (a) to the extent and when
necessary or advisable, in the opinion of nationally recognized bond counsel
acceptable to the Issuer, to preserve the exemption of interest on the Bonds from
federal income taxation and (b) to the extent requested by either party if, in the
opinion of nationally recognized bond counsel acceptable to the Issuer, such
amendment will not adversely affect the federal tax exemption of interest on the
Bonds; provided that no such amendments shall be permitted or required hereunder
if there is pending before Congress, or either house of Congress, legislation which
if enacted would be applicable to the Bonds and could affect the tax-exempt status
of interest.on the Bonds, unless such amendment would not adversely affect the tax-
exempt status of interest on the Bonds if such legislation were to become law.
11. Severability. The invalidity of any clause, part or provision of this
Agreement shall not affect the validity of the remaining portions thereof.
12. Notices. All notice to be given pursuant to this Agreement shall be in
writing and shall be deemed given when mailed by certified or registered mail,
return receipt requested, to the parties hereto at the addresses set forth below, or
to such other place as a party may from time to time designate in writing. A
duplicate copy of each notice, certificate or other communication given hereunder by
the Issuer or the Company shall also be given to the Trustee at the address set forth
below. The Issuer, the Company and the Trustee may, by notice given hereunder,
designate any further or different addresses to which subsequent notices,
certificates or other communications shall be sent. The initial addresses for notices
and other communications are as follows:
To the Issuer: City of Richfield, Minnesota
6700 Portland Avenue
Richfield, Minnesota 55423-2598
Attn: City Manager
To the Company:
c/o Dominium Management Services, Inc.
3140 Harbor Lane, Suite 102
Minneapolis, Minnesota 55447
To the Trustee:' First Trust National Association
180 East Fifth Street
St. Paul, Minnesota 55101
Attn: Corporate Trust Department
To the Remarketing
Agent: Piper Jaffray Inc.
222 South Ninth Street, 15th Floor
Minneapolis, Minnesota 55402
Attn : Head of Municipal Underwriting
13. Governing Law. This Agreement shall be governed by the laws of the
State of Minnesota and, where applicable, the laws of the United States of America.
14. Attorneys' Fees. In case any action at law or in equity, including an
action for declaratory relief, is brought against the Company to enforce the
provisions of this regulatory Agreement, the Company agrees to pay reasonable
BLP84973 Regulatory Agreement
RC125-94 9 First Draft - March 20, 1995
attorneys' fees and other reasonable expenses incurred by the Issuer in connection
with such action.
15. Agreement Binding. This Agreement and the covenants contained
herein shall run with the Premises and shall bind the Company (including each
general, special or limited partner of the Company, each of whom the Company
hereby represents to have authorized the Company to bind by this Agreement, and,
to the extent controlled by the Company or any of the foregoing, each person who
is "related" to any of the foregoing within the meaning of Section 147(a) of the
Code) ; its heirs, legal representatives,. executors, administrators, successors in
office or interest, and assigns, and all subsequent owners of the Project or any
interest therein, and the benefits shall inure to the Issuer and its successors and
assigns for the term of this Agreement as provided in Section 1(d) .
•
BLP84973 Regulatory Agreement
RC125-94 10 First Draft - March 20, 1995
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed
by their respective duly authorized representatives, as of the day and year first
written above.
CITY OF RICHFIELD,
MINNESOTA
By
. Its Mayor
(SEAL)
By
Its City Manager
STATE OF MINNESOTA )
COUNTY OF HENNEPIN )
ACKNOWLEDGEMENT
) ss
0 On this day of April in the year 1995, before me personally appeared
and , personally known to me (or proved
on the basis of satisfactory evidence) to be the persons who executed this
instrument as Mayor and City Manager, respectively, of the City of Richfield,
Minnesota on behalf of the City.
Given under my hand and official seal this day of April, 1995.
Notary Public
•
BLP84973 Regulatory Agreement
RC125-94 1 1 First Draft - March 20, 1995
FIRST TRUST NATIONAL
ASSOCIATION
(SEAL)
By
Its
STATE OF MINNESOTA )
ss
COUNTY OF HENNEPIN )
On the day of April, 1995, before me personally came
, to me known, who, being by me duly sworn, did depose
and say that s / he is a of First Trust National
Association, a national banking association, on behalf of said association.
Notary Public
•
•
BLP84973 Regulatory Agreement
RC125-94 12 First Draft - March 20, 1995
•
By
Its
STATE OF MINNESOTA )
ss
COUNTY OF HENNEPIN )
On the day of April, 1995, before me personally appeared
, to me known, who, being by me duly sworn, did depose
and say that s /he is the of , a Minnesota limited
partnership, on behalf of the limited partnership.
Notary Public
•
•
BLP86973 Regulatory Agreement
RC125-94 13 First Draft - March 20, 1995
•
•
•
BLPS4973
RC125-94
EXHIBIT A
Legal Description
Regulatory Agreement
First Draft - March 20, 1995
•
BLP84973
RC125-94
EXHIBIT B
Tenant Income Certificason
Regulatory Agreement
First Draft - March 20, 1995
EXHIBIT C
Certificate of
Continuing Program Compliance
Date : 19
The following information with respect to the Project located at
(the "Project"), is being provided' by
(the "Company") to the City of Richfield, Minnesota. (the
"Issuer"), pursuant to that certain Regulatory Agreement dated as of April- 1, 1995
(the "Regulatory Agreement") with respect to the Project :
(A) The total number of residential units which are available for
occupancy is 1,140 The total number of such units occupied is
(B) The following residential units (identified by unit number) have
been designated for occupancy by "Qualified Tenants," as such term is
defined in the Regulatory Agreement (for a total of )
(C) The following residential units which are included in (B) above,
have been re-designated as units for Qualified Tenants since ,
19 , the date on which the last "Certificate of Continuing Program
Compliance" was filed with the Issuer by the Company:
Unit Previous Designation Replacing
Number of Unit (if any) Unit Number
(D) The following residential units are considered to be occupied by
Qualified Tenants based on the information set forth below:
?J
BLP84973 Regulatory Agreement
RC125-94 C-1 First Draft - March 20, 1995
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
Number of Date of
Unit Name of Persons Residing Total Adjusted Initial
Number Tenant In the Unit Gross Income Occupancy
T
(E) The. Company has obtained a "Certificate of Tenant Eligibility,"
in the form provided as Exhibit "B" to the Regulatory Agreement, from each
Tenant named in (D) above, and each such Certificate is being maintained by
the Company in its records with respect to the Project. Attached hereto is the
most recent "Certificate of Tenant Eligibility" for each Tenant named in (D)
above who signed such a Certificate since , 19 , the date on
which the last "Certificate of Continuing Program Compliance" was filed with
the Issuer by the Company.
(F) In renting the residential. units in the Project, the Company has
not given preference to any particular group or class of persons (except for
persons who qualify as Qualified Tenants) ; and none of the units listed in (D)
above have been rented for occupancy entirely by students, no one of which
is entitled to file a joint return for federal income tax purposes. All of the
residential units in the Project have been rented pursuant to a written lease,
and the term of each .lease is at least months.
(G) The information provided in this "Certificate of Continuing
Program Compliance" is accurate and complete, and no matters have come to
the attention of the Company which would indicate that any of the information
provided herein, or in any "Certificate of Tenant Eligibility" obtained from the
Tenants named herein, is inaccurate or incomplete in any respect.
•
•
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BLP84973 Regulatory Agrssmsnt
RC125-96 C-2 First Draft - March 20, 1995
IN WITNESS WHEREOF, I have hereunto affixed my signature, on behalf of the
Company, on 19
LIMITED PARTNERSHIP
By
Its General Partner
By
Its General Partner
•
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BLP84973 Regulatory Agreement
RC125-94 C-3 First Draft - March 20, 1995
HOUSING PROGRAM FOR A
MULTIFAMILY HOUSING DEVELOPMENT
Pursuant to Minnesota Statutes, Chapter 462C (the "Act"), the City of
Richfield (the "City") is authorized to develop and administer programs to finance
the acquisition and rehabilitation of multifamily housing developments under the
circumstances and within the limitations set forth in the Act. Minnesota Statutes,
Section 462C.07 provides that such programs for multifamily housing developments
may be financed by revenue bonds issued by the City.
The City has received a proposal that it approve a program providing for the
acquisition and rehabilitation of a 1,140-unit qualified residential rental project
known as Century Court Apartments (the "Project") located at 7431-7521 Lyndale
Avenue, 6301-6335 Lyndale Avenue, and 7600-7720 Penn Avenue in the City, by
Dominium, Inc. a Minnesota corporation, or a limited partnership to be formed in
which Dominium, Inc. will be a general partner (the "Developer"). The acquisition
and rehabilitation of the Project is to be funded through the issuance of up to
$19,679,000 in revenue bonds to be issued by the City (the "Bonds"). Following
acquisition and rehabilitation of the Project, the Developer will own and operate the
Project as a multifamily residential rental project. The Project will meet the minimum
rehabilitation requirements of Sections 147 (d) and 42 (e) (2) of the Internal Revenue
Code of 1986, as amended (the "Code") and will be occupied by individuals or
families whose incomes at the time of initial occupancy will meet the requirements of
Sections 142(d) and 42(g) of the Code. It is estimated that rents for the Housing
Units will range from approximately $395 per month to $490 per month.
The City, in establishing this multifamily housing program (the "Program"),
has considered the information contained in the City's 462C Housing Plan (the
"Housing Plan"). The Project will be acquired and rehabilitated in accordance with
the requirements of Subdivisions 1 and 2 of Section 462C. 05 of the Act .
Section A. Definitions. The following terms used in this Program shall have
the following meanings, respectively:
"Act" shall mean Minnesota Statutes, Section 462C.01, et seq., as
currently in effect and as the same may be from time to time amended.
"Bonds" shall mean the revenue bonds to be issued by the City to
finance ' the Program.
"City" shall mean the City of Richfield, Minnesota.
"Developer" shall mean Dominium, Inc., a Minnesota corporation, or a
limited partnership to be formed in which Dominium, Inc. will be a general
partner.
"Housing Plan" shall mean the City's 462C Housing Plan, adopted
pursuant to the Act, of which this Program is a part.
"Housing Unit" shall mean any one of the apartment units, each located
in the Project, occupied by one person or family, and containing complete
living facilities.
"Land" shall mean the real property upon which the Project is situated.
BLPS3546
RC125-96
"Program" shall mean this program for the financing of the Project
pursuant to the Act.
"Project" shall mean the residential rental housing development
consisting of approximately 1,140 Housing Units, 1,138 one-bedroom and 2
two-bedroom units to be acquired and rehabilitated by the Developer.
Section B : Program For Financing the Project. It is proposed that the City
establish this Program to provide financing or acquisition and rehabilitation of the
Project at a cost and upon such other terms and conditions as are set forth herein
and as may be agreed upon in writing between the City, the initial purchaser of the
Bonds and the Developer. The City expects to issue the Bonds prior to April 9,
1995, but only when and if the terms of the Bonds have been agreed upon by the
City, the Developer and the initial purchaser of the Bonds. The proceeds of the
Bonds will be loaned to the Developer to finance the acquisition and rehabilitation of
the Project, to fund required reserves and to pay the costs of issuing the Bonds.
It is expected that a trustee will be appointed by the City to monitor the
rehabilitation of the Project and the payment of principal and interest on the Bonds
It is anticipated that the Bonds shall have a maturity of approximately thirty
(30) years and will bear interest at a rate priced to the market at the time of
issuance.
The City will hire no additional staff for the administration of the Program.
Insofar as the City will be contracting with underwriters, legal counsel, bond
counsel, the trustee, and others, all of whom will be reimbursed from bond proceeds
and revenues generated by the Project, no administrative costs will be paid from the
City's budget with respect to this Program. The Bonds will not be general obligation
bonds of the City, but are to be paid only from properties pledged to the payment
thereof, which may include additional security such as additional collateral,
insurance or a letter of credit.
•
Section C. Local Contributions To The Program. The City will participate in
the Project financing as necessary to comply with the requirements of Chapter 474A,
relating to the allocation of tax-exempt bonding authority to the Bonds.
Section D.
tPursuant
and
the Financing of the
apply wit
Program :
ro am. The following standards and requirements shall
operation of the Project by the Developer pursuant to this
(1) . Substantially all of the proceeds of the sale of the Bonds will be
applied to the acquisition and rehabilitation of the Project and to the funding
of appropriate reserves. The proceeds will be made available to the Developer
pursuant. to the terms of the Bond offering, which will include certain
covenants to be made by the Developer to the City regarding the use of
proceeds and the character and use of the Project.
(2) The Developer, and any subsequent owner of the Project, will not
arbitrarily reject an application from a proposed tenant because of race, color,
creed, religion, national origin, sex, marital status, or status with regard to
public assistance or disability.
(3) At least forty percent (40%) of the Housing Units will be held for
occupancy by families or individuals with gross income not in excess of sixty
percent (60%) of median family income, adjusted for family size, in order to
BLP83546
RC125-94
2
•
comply with Federal tax law requirements for the use of tax-exempt financing.
48 This set aside will also satisfy the low-income occupancy requirements of
Section 462C.05, Subdivision 2 of the Act.
(4) Pursuant to Section 462C.05, Subdivision 2 of the Act, the
Project is designed to be affordable by persons and families with Adjusted
Gross Income not in excess of the greater of (a) 110 percent of the median
family income as estimated by the United States Department of Housing and
Urban Development for Hennepin County, or (b) 100 percent of the income
limits established by the Minnesota Housing Finance Agency for the City and
by other persons and families to the extent determined to be necessary by the
City in furtherance of the policy of economic integration.
Subsection E. Evidence of Compliance. The City may require from the
Developer at or before the issuance of the Bonds, evidence satisfactory to the City
of the ability and intention of the Developer to complete the rehabilitation of the
Project, and evidence satisfactory to the City of compliance with the standards and
requirements for the financing established by the City; and in connection therewith,
the City or its representatives may inspect the relevant books and records of the
Developer in order to confirm such ability, intention and compliance. In addition,
the City may periodically require certification from either the Developer or such
other person deemed necessary concerning compliance with various aspects of this
Program.
Subsection F. Issuance of Bonds. To finance the Program authorized by this
Section the City may by resolution authorize, issue and sell its revenue bonds in an
aggregate principal amount of approximately.$19, 679, 000. The Bonds shall be issued
pursuant to Section 462C.07, Subdivision 1 of the Act, and shall be payable
primarily from the revenues of the Program authorized by this Section. The costs
of the Project are presently expected to be as follows:
Acquisition and Rehabilitation $19,285,420
Costs of Issuance 393,580
TOTAL $19,679,000
The costs of the Project may change between the date of preparation of this
program and the date of issuance of the Bonds. The Bonds are expected to be
issued prior to April 9; 1995.
Subsection G. Severability. The provisions of this Program are severable and
if any of its provisions, sentences, clauses or paragraphs shall be held
unconstitutional, contrary to statute, exceeding the authority of the City or
otherwise illegal or inoperative by any court of competent jurisdiction, the decision
of such court shall not affect or impair any of the remaining provisions.
Subsection H. Amendment. The City shall not amend this Program, while
Bonds authorized hereby are outstanding, to the detriment of the holders of such
Bonds.
Subsection I. State Ceiling. $19,679,000 of the state ceiling for private
activity bonds, pursuant to Section 146 of the Internal Revenue Code of 1986, as
amended, and Chapter 474A of Minnesota Statutes has been obtained with respect to
the Bonds.
40 ELP83546
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