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HRA hears introduction on host approval request for 180 Degrees’ Brittany’s Place; vote set for June 18
Summary
St. Paul HRA received an introductory presentation on a requested host approval that would allow 180 Degrees to access bank-qualified tax-exempt conduit revenue bonds to refinance renovations at Brittany's Place. No vote was taken; the City Council is scheduled to consider host approval June 18.
The St. Paul Housing and Redevelopment Authority received an introductory presentation on a request from nonprofit 180 Degrees for host approval that would allow the organization to access bank-qualified tax-exempt conduit revenue bonds to refinance a taxable loan used for renovations at Brittany's Place on East Seventh Street.
Jenny Wolf, HRA debt administrator, told commissioners the bonds would be issued by another governmental issuer (a city near Rochester was named in the presentation) and that the HRA’s role would be to provide host approval because the project is located in St. Paul. Wolf said the principal amount for the St. Paul portion is "about $850,000" and that the amount will be capped at that level.
Dan Farr, president and CEO of 180 Degrees, described why the organization is refinancing. He said the nonprofit used a conventional loan at about 7.75 percent to rehab the shelter and transitional-living space; refinancing with tax-exempt conduit bonds would lower their interest cost to about 5 percent and “save tens of thousands of dollars” that can be used for services.
Wolf outlined fees and conditions identified in staff materials: the HRA would collect a standard closing fee of one-quarter of 1 percent of the bond amount for the St. Paul project, a $1,500 fee for city attorney review, and a $5,000 application fee. Because construction is already complete, 180 Degrees must file an affirmative action plan with the city as a condition before closing, Wolf said.
No public testimony was recorded at the introduction and no formal action was taken. Chair Johnson and others thanked Dan Farr for the organization’s work and noted a vote on a host approval resolution is scheduled for the City Council on Wednesday, June 18. Wolf said, if approved, the project is set to close in July.
The HRA record at this meeting is an introduction only; staff and the organization said the bonds do not place long-term risk onto St. Paul since the bond obligation is payable from the borrower’s revenue and the HRA would not be the issuer.
