Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Housing Finance topic
No spam. Unsubscribe anytime.
Council approves refinancing of Chase at 9 Mile Creek; bonds to be tax‑exempt multifamily housing revenue refunding bonds
Summary
The council approved issuance of tax-exempt multifamily housing revenue refunding bonds to refinance an existing private activity bond for the Chase at 9 Mile Creek apartment project; the EDA later approved a related assignment and subordination agreement for tax increment financing documents.
The Minnetonka City Council on June 9 approved a resolution authorizing the issuance of multifamily housing revenue refunding bonds for the benefit of Roland Investments LLC to refinance the Chase at 9 Mile Creek project at 5709 Roland Road.
Staff and bond counsel explained the action is a conduit-style private activity refinancing: the city issues tax-exempt housing revenue refunding bonds on behalf of the borrower to refinance outstanding multifamily housing bonds. City staff and bond counsel clarified the bonds do not constitute a general obligation of the city, are not secured by city assets or taxing power and do not count against the city’s debt limits.
Council action and vote: Councilmember Calvert moved adoption of the resolution authorizing issuance of the bonds; Councilmember Coakley seconded. A roll call vote was unanimous in favor.
Project and affordability: The original financing, issued in 2015, supported acquisition and construction of 106 rental units at 5709 Roland Road. As part of the original project, 21 units were required to remain affordable at 50 percent of area median income (AMI) through 2045; the affordability restrictions remain in place and were not changed as part of the refinancing.
EDA action: The City of Minnetonka Economic Development Authority (EDA) met immediately after the council session and adopted a resolution approving an amended assignment and subordination of the development agreement and the tax increment financing documents with Roland Investments LLC and Huntington National Bank. The EDA action implements necessary lender documentation associated with the bond refinancing.
Why the borrower is refinancing: Borrower representatives said the refinancing will secure a lower interest rate and fold outstanding indebtedness into a new structure; bond counsel said the refinancing does not change the city’s exposure because the bonds are conduit private activity bonds. Borrower representatives said the property has maintained high occupancy since opening and that the affordable units have been occupied and used by residents.
