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HomeMy WebLinkAbout10.E.1. Amendments to the Contract for Private Development (CPD) between the City of Shakopee and All Saints Senior Living of Shakopee LLC-Res. No. 7256 EDI?- 5 Ccon cil-JC E .I . CITY OF SHAKOPEE Memorandum CASE NO.: 12002 TO: Mayor and City Council Economic Development Authority (EDA) Mark McNeill, City Administrator/EDA Executive Director FROM: R. Michael Leek, Community Development Director SUBJECT: Consideration of Amendments to Contract for Private Development (CPD) between the City of Shakopee and All Saints Senior Living of Shakopee, LLC (All Saints) MEETING DATE: November 20, 2012 REQUESTED ACTION: The EDA and City Council are asked to approve the first amendment to the Contract for Private Development between the City of Shakopee and All Saints, and to the consent to pledge of TIF between All Saints and Tradition Capital Bank. INTRODUCTION: When originally approved, the All Saints project included 80 total units. The project developer wishes to increase the number of units to 84, which in turn requires an amendment to the CPD between the City, the City's EDA and All Saints. Related to the amendment of the CPD is the request that the City and EDA consent to the pledge of tax increment note between All Saints and Tradition Capital Bank. RELATIONSHIP TO CITY GOALS: The proposed project and requested actions relative to the CPD relate to the following City Goals; B. Positively manage the challenges and opportunities presented by growth, development and change. D. Maintain, improve and create strong partnerships with other public and private sector entities. ACTIONS REQUESTED: City Council: The City Council is asked to offer and pass Resolution No. 7256 approving the first amendment to the CPD between the City of Shakopee, EDA for the City of Shakopee and All Saints Senior H: \CC \2012 \Trident CPD amendments_11202012_final.doc 1 Living of Shakopee, LLC and the consent to the pledge of tax increment note between All Saints and Tradition Capital Bank. EDA: The EDA is asked to offer and pass Resolution No. 12 -8 approving the first amendment to the CPD between the City of Shakopee, EDA for the City of Shakopee and All Saints Senior Living of Shakopee, LLC and the consent to the pledge of tax increment note between All Saints and Tradition Capital Bank. / R. Michael Leek Community Development Director H: \CC \2012 \Trident CPD amendments 11202012 final.doc 2 CITY OF SHAKOPEE, MINNESOTA RESOLUTION NO. 7256 RESOLUTION APPROVING FIRST AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT BETWEEN THE CITY, THE ECONOMIC DEVELOPMENT AUTHORITY FOR THE CITY OF SHAKOPEE, AND ALL SAINTS SENIOR LIVING OF SHAKOPEE, LLC AND CONSENT TO PLEDGE OF TAX INCREMENT NOTE BETWEEN ALL SAINTS SENIOR LIVING OF SHAKOPEE, LLC AND TRADITION CAPITAL BANK WHEREAS, pursuant to a resolution adopted by the City Council of the City of Shakopee, Minnesota (the "City") on June 5, 2012, the City approved the establishment of Housing and Redevelopment Project No. 2 (the "Project ") by the Economic Development Authority for the City of Shakopee (the "Authority") in accordance with the terms of Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act ") and Sections 469.090 through 469.1082, as amended (the "EDA Act "), and the creation of Tax Increment Financing (Housing) District No. 15 (the "TIF District ") within the Project, pursuant to Minnesota Statutes, Sections 469.174 to 469.1799, as amended (the "TIF Act "); and WHEREAS, on June 19, 2012, the City, the Authority, and All Saints Senior Living of Shakopee, LLC (the "Developer "), executed a Contract for Private Development (the "Agreement ") setting forth the parties' respective responsibilities in developing a senior housing facility within the boundaries of the TIF District; and WHEREAS, at the time of execution of the Agreement, the Developer anticipated the development of an approximately 84,000 square foot senior rental housing facility containing 80 rental units, of which at least 20% of such units (i.e., 16) will be occupied by persons with incomes no greater than 50% of the median income within Scott County (the "Minimum Improvements "); and WHEREAS, the Developer wishes to increase the rental units from 80 to 84; and WHEREAS, there has been presented for review before the City Council the First Amendment to Contract for Private Development (the "First Amendment "), which provides for the increase in units from 80 to 84 and reaffirms the Developer's covenant that at least 20% of such units (i.e., 17) will be occupied by persons with income no greater than 50% of the median income within Scott County; and WHEREAS, the Developer has entered into negotiations with Tradition Capital Bank, a Minnesota state banking corporation (the "Lender "), whereby it is proposed that the Bank loan the Developer money to help finance the construction of the Minimum Improvements; and WHEREAS, to secure the payment and performance of Developer's obligation to repay the loan to the Lender, the Lender has required and the Developer has agreed to provide a Pledge of Tax Increment Revenue Note; and WHEREAS, the Developer has requested that the City and the Authority execute an Acknowledgement and Consent to the Pledge Agreement (the "Consent to Pledge Agreement "); and NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Shakopee, Minnesota that: H: \CC\ 2012\ 11- 20 \Shakopee_Trident CC_Resol_Appr_First_Amend to_CPD.doc 1. The City Council approves the First Amendment and the Pledge Agreement Consent in substantially the forms on file in City Hall. The Mayor and City Administrator are hereby authorized and directed to execute and deliver the First Amendment and the Pledge Agreement Consent. All of the provisions of First Amendment and the Pledge Agreement Consent, when executed and delivered 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 First Amendment and the Pledge Agreement Consent shall be substantially in the forms on file with the City which is hereby approved, with such omissions and insertions as do not materially change the substance thereof, or as the Mayor and the City Administrator in their discretion, shall determine, and the execution thereof by the Mayor and the City Administrator shall be conclusive evidence of such determination. Approved by the City Council of the City of Shakopee, Minnesota this 20th day of November, 2012. Mayor ATTEST: Finance Director /City Clerk 408393v1 JAE SH235 -18 2 ECONOMIC DEVELOPMENT AUTHORITY FOR THE CITY OF SHAKOPEE RESOLUTION NO. 12 -8 RESOLUTION APPROVING FIRST AMENDMENT TO CONTRACT FOR PRIVATE DEVELOPMENT BETWEEN THE CITY OF SHAKOPEE, THE ECONOMIC DEVELOPMENT AUTHORITY FOR THE CITY OF SHAKOPEE, AND ALL SAINTS SENIOR LIVING OF SHAKOPEE, LLC AND CONSENT TO PLEDGE OF TAX INCREMENT NOTE BETWEEN ALL SAINTS SENIOR LIVING OF SHAKOPEE, LLC AND TRADITION CAPITAL BANK WHEREAS, pursuant to a resolution 'adopted by the Board of Commissioners of the Economic Development Authority for the City of Shakopee (the "Authority") on June 5, 2012, the Authority approved the establishment of Housing and Redevelopment Project No. 2 (the "Project ") in accordance with the terms of Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act ") and Sections 469.090 through 469.1082, as amended (the "EDA Act "), and the creation of Tax Increment Financing (Housing) District No. 15 (the "TIF District ") within the Project, pursuant to Minnesota Statutes, Sections 469.174 to 469.1799, as amended (the "TIF Act "); and WHEREAS, on June 19, 2012, the City of Shakopee, Minnesota (the "City"), the Authority, and All Saints Senior Living of Shakopee, LLC (the "Developer "), executed a Contract for Private Development (the "Agreement ") setting forth the parties' respective responsibilities in developing a senior housing facility within the boundaries of the TIF District; and WHEREAS, at the time of execution of the Agreement, the Developer anticipated the development of an approximately 84,000 square foot senior rental housing facility containing 80 rental units, of which at least 20% of such units (i.e., 16) will be occupied by persons with incomes no greater than 50% of the median income within Scott County (the "Minimum Improvements "); and WHEREAS, the Developer wishes to increase the rental units from 80 to 84; and WI-IEREAS, there has been presented for review before the Board of Commissioners the First Amendment to Contract for Private Development (the "First Amendment "), which provides for the increase in units from 80 to 84 and reaffirms the Developer's covenant that at least 20% of such units (i.e., 17) will be occupied by persons with income no greater than 50% of the median income within Scott County; and WHEREAS, the Developer has entered into negotiations with Tradition Capital Bank, a Minnesota state banking corporation (the "Lender "), whereby it is proposed that the Bank loan the Developer money to help finance the construction of the Minimum Improvements; and WHEREAS, to secure the payment and performance of Developer's obligation to repay the loan to the Lender, the Lender has required and the Developer has agreed to provide a Pledge of Tax Increment Revenue Note; and WHEREAS, the Developer and the Lender have requested that the City and the Authority execute an Acknowledgement and Consent to the Pledge Agreement (the "Consent to Pledge Agreement "); and NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority for the City of Shakopee that: 408408v1 JAE SH235 -18 1. The Board of Commissioners approves the First Amendment and the Pledge Agreement Consent in substantially the forms on file in City Hall. The President and Executive Director are hereby authorized and directed to execute and deliver the First Amendment and the Pledge Agreement Consent. All of the provisions of First Amendment and the Pledge Agreement Consent, when executed and delivered 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 First Amendment and the Pledge Agreement Consent shall be substantially in the forms on file with the Authority which is hereby approved, with such omissions and insertions as do not materially change the substance thereof, or as the President and Executive in their discretion, shall determine, and the execution thereof by the President and Executive shall be conclusive evidence of such determination. Adopted by the Board of Commissioners of the Economic Development Authority for the City of Shakopee, Minnesota, this 20th day of November, 2012. President Executive Director H: \CC\2012 \11 -20 \Shakopee_Trident EDA Resol Appr First Amend_toPD.doc