AGENDA

SPPA Board of Commissioners|amk

Regular Board Meeting June 23, 2020 - 2:00 p.m.

380 St. Peter Street, Suite 850 l Saint Paul, MN 55102 Chair Bennett is calling a meeting of the Board of Commissioners for Tuesday, June 23, 2020 at 2:00 p.m. Chair Bennett has determined, due to the emergency declared by the Governor of Minnesota and the Mayor of Saint Paul regarding the COVID-19 health pandemic, that it is not practical nor prudent for the Saint Paul Port Authority Board and members of the staff to meet in-person or pursuant to Minnesota Statutes, Section 13D.02. In light of the COVID-19 health pandemic, it is not feasible for any member of the Saint Paul Port Authority Board and staff to be present at the regular location, and all staff and Board members of the Saint Paul Port Authority will attend this meeting by telephone or other electronic means. 

It is also not feasible for members of the public to attend the meeting at its regular location due to the health pandemic and emergency. Accordingly, no meeting will be held at the Saint Paul Port Authority offices which are located at 380 St. Peter Street, Suite 850, St. Paul, MN. Members of the public may monitor this meeting remotely at 651-395-7858, Conference ID: 380 755 725#. The purpose of the meeting is: Minutes Approval of Minutes of the May 26, 2020 Regular Board Meeting Conflicts of Interest Conflicts with any Items on the Agenda New Business Credit Committee 1. Resolution No. 4677 – Authorization of EPA Revolving Loan Funds for Hillcrest

Redevelopment Project

2. Resolution No. 4678 – Port Authority Occupancy General Matters 1. Equity Strategic Action Plan Board Progress Report – Lisa Tabor, Culture Brokers 2. Such Other Business That May Come Before the Board

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SAINT PAUL PORT AUTHORITY MINUTES OF THE REGULAR BOARD MEETING

MAY 26, 2020 ______________________________________________________________________________ The regular meeting of the Port Authority Board was held on May 26, 2020 at 2:50 p.m. via Microsoft Teams. The following Board Members were present: John Bennett Paul Williams John Marshall Don Mullin Dai Thao Nneka Constantino Also present were the following: Lee Krueger Todd Hurley Monte Hilleman Michael Linder Pete Klein Bruce Kessel Dana Krueger Ann Kosel Tonya Bauer David Johnson Nelly Chick Sarah Savela Andrea Novak Ava Langston-Kenney Linda Williams Laurie Siever Eric Larson, City of Saint Paul

APPROVAL OF MINUTES

Commissioner Mullin made a motion to approve the minutes of the April 28, 2020 Regular Board Meeting. The motion was seconded by Commissioner Williams, submitted to a roll call vote and carried unanimously.

CONFLICT OF INTEREST

There were no conflicts of interest with any items on the agenda.

NEW BUSINESS

CREDIT COMMITTEE

RESOLUTION NO. 4675 REVISED, AMENDED AND RESTATED RESOLUTION NO. 4673 TO

COMPLY WITH DEED’S REQUIREMENTS TO APPLY FOR CONTAMINATION CLEANUP GRAND FUNDS FOR UNITED VILLAGE AT MIDWAY PROJECT (BLOCK B)

Motion was made by Chair Mullin to approve Resolution No. 4675 which was reviewed by the Credit Committee and recommended for approval by the Board. The motion was submitted to a roll call vote and carried unanimously.

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RESOLUTION NO. 4676 APPROVAL OF THE ISSUANCE OF ONE OR MORE SERIES OF UP TO $11,075.00 OF TAXABLE TAX INCREMENT REVENUE REFUNDING BONDS (TREASURE ISLAND CENTER) SERIES 2020

Motion was made by Chair Mullin to approve Resolution No. 4676 which was reviewed by the Credit Committee and recommended for approval by the Board. The motion was submitted to a roll call vote and carried unanimously.

GENERAL MATTERS

There being no further business, the meeting was adjourned at 3:05 p.m. By ________________________________ Its _________________________________

MEMORANDUM

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To: BOARD OF COMMISSIONERS Meeting Date: June 23, 2020

From: Ava Langston-Kenney

Subject: AUTHORIZATION OF EPA REVOLVING LOAN FUNDS FOR HILLCREST REDEVELOPMENT PROJECT

RESOLUTION NO. 4677 Action Requested: The Port Authority of the City of Saint Paul (the “Port Authority”) seeks authorization to use the Port Authority’s EPA Revolving Brownfield Loan Fund to pay a portion (up to $1,200,000) of the costs associated with demolition, remediation and soil correction of the Hillcrest Redevelopment site (the “Hillcrest Site”), an approximately 112-acre site located at 2200 Larpenteur Avenue East, Saint Paul, Minnesota. See a map attached which shows the location of the property. Background The Port Authority acquired the former Hillcrest Golf Course site in July 2019 to facilitate the mixed-use redevelopment of one of the last large tracts of land within the Saint Paul city limits. Redeveloping the Hillcrest Site presents an incredible opportunity for the City of Saint Paul (the “City”) and will be an enormous asset for the east side of the city. The potential of this brownfield for housing, jobs and green space on the Hillcrest Site are important for the City now and in the future. The Port Authority is collaborating with the City as it develops a comprehensive master plan. As the owner, the Port Authority has the obligation to pay for the demolition, remediation and soil corrections at the Hillcrest Site to make it buildable, as well as the infrastructure, including roads and utilities. The RLF Loan Fund is one source that is available for funding for environmental clean-up of the Hillcrest Site. Since 2003, the Port Authority has received grant funds from the EPA to create and operate a revolving loan fund for our brownfield projects. The RLF Loan Funds are available for petroleum and hazardous waste remediation-related purposes. The last loan processed was five years ago for the Midway Stadium redevelopment, and the Port Authority drew down that loan in June of 2017. To satisfy the EPA requirement for retention of the funds, the Port Authority needs to demonstrate “significant progress” within three years of the last activity for the loan. These funds can be used as intra-governmental loans between the Finance Department and Development Department within the Port Authority, as authorized by the EPA. Currently there is a balance of $600,000 from the Petroleum budget and $1,260,000 from the Hazardous Substance budget, for a total balance of $1,860,000 in the Revolving Loan Fund. Upon Board approval, steps will be taken to execute a loan agreement for a loan of up to $1,200,000 for ten years that bears an interest rate tied to the five-year treasury plus 50 basis points. This action will meet the “significant progress” EPA requirement for retention of the loan funds.

MEMORANDUM

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Recommendation: We recommend that the Board authorize staff to use the Port Authority’s EPA Revolving Brownfield Loan Fund to pay a portion ($1,200,000) of the costs associated with demolition, remediation and soil correction of the Hillcrest Redevelopment Site. Attachments: Map

Resolution

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µHillcrest Project AreaHillcrest Project Area

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112 Acres: Former Hillcrest Golf Course2200 Larpenteur Ave E, Saint Paul MN

HILLCREST

Resolution No. 4677

RESOLUTION OF THE PORT AUTHORITY OF THE CITY OF SAINT PAUL

[AUTHORIZATION OF EPA REVOLVING LOAN FUND

USE FOR HILLCREST REDEVELOPMENT PROJECT]

WHEREAS, the Port Authority of the City of Saint Paul is a public body corporate and politic and governmental subdivision organized pursuant to Chapter 469 of Minnesota Statutes.

WHEREAS, the Port Authority’s Board of Commissioners are appointed by the Mayor of

the City of Saint Paul subject to the approval of the Council of the City of Saint Paul. WHEREAS, two of the Port Authority Commissioners must be members of the Council of

the City of Saint Paul. WHEREAS, said members of the Council of the City of Saint Paul serve on the Port

Authority Board so long as they continue to be members of the Council of the City of Saint Paul. WHEREAS, the district of the Port Authority is the City of Saint Paul. WHEREAS, under Minn. Stat. § 469.055, the Port Authority shall (1) promote the general

welfare of the port district, and of the port as a whole; (2) try to increase the volume of the port's commerce; (3) promote the efficient, safe, and economical handling of the commerce; and (4) provide or promote adequate docks, railroad and terminal facilities open to all on reasonable and equal terms for the handling, storage, care, and shipment of freight and passengers to, from, and through the port. WHEREAS, the Port Authority was awarded a grant by the Environmental Protection Agency (EPA) to establish a Revolving Loan Fund for use in our brownfield projects.

WHEREAS, the Port Authority seeks to use the EPA Revolving Loan Fund grant as an internal loan to pay a portion (up to $1,200,000) of the eligible project costs associated with brownfield redevelopment (demolition, remediation and soil correction) of the Hillcrest Redevelopment site.

WHEREAS, the internal loan will be from the Port Authority’s Finance Department to the

Port Authority’s Development Department. WHEREAS, it is in the best interests of the port district and the people thereof, and in

furtherance of the general plan of port improvement and industrial development, to approve the loan.

NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE PORT

AUTHORITY OF THE CITY OF SAINT PAUL: that an internal loan between the Finance Department

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of the Port Authority and the Development Department of the Port Authority in an amount up to $1,200,000 from the EPA Revolving Loan Fund grant for use in brownfield redevelopment of the Hillcrest Redevelopment site is hereby authorized; and

BE IT FURTHER RESOLVED, that the President or anyone acting under his direction is

hereby authorized and directed to execute any and all necessary documents to complete this internal loan transaction.

Adopted: June 23, 2020 PORT AUTHORITY OF THE CITY OF SAINT PAUL

By ______________________________________ Its Chair ATTEST: By _________________________________ Its Secretary

MEMORANDUM

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To: BOARD OF COMMISSIONERS Meeting Date: June 23, 2020

From: Monte Hilleman

Subject: PORT AUTHORITY OCCUPANCY RESOLUTION NO. 4678 Action Requested: Approval authorizing the President or his designees to negotiate the final terms of, and enter into, a contingent lease agreement for office space for the Port Authority of the City of Saint Paul for a twelve-year term, with two five-year renewal options. Approval to self-finance tenant improvements in lieu of base rent, with total annual occupancy costs to remain at or below current occupancy costs at INFOR Commons, with the total self-financing portion not to exceed $1,250,000. Approval authorizing the President or his designees to:

Enter into a contingent lease agreement with Go Wild, LLC for space at Treasure Island Center:

a. Lease to be executed immediately b. Construction to start in July c. Occupancy by end of 2020

Contingencies are: a. Port Authority Board approval b. Approval from Midwest Reliability Organization (MRO) for their expansion into the

Port Authority’s INFOR Commons location Background: In January of 2013, the Saint Paul Port Authority entered into a ten-year lease agreement with Lawson Commons, now known as INFOR Commons. In September of 2019, the Port Authority President and CFO were asked to meet with Frauenshuh, INFOR Common’s owner, to discuss the Port Authority’s occupancy on the eighth floor of the building. Frauenshuh explained that MRO, a technology/innovation firm and the Port Authority’s neighboring tenant, would like to expand and take over the entire eighth floor in order to add 20-25 employees to this location.

MEMORANDUM

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Current Status: To facilitate this business retention and expansion of a technology-focused office user in downtown Saint Paul, senior management agreed to investigate the possibility of moving the Port Authority’s offices. All possible office vacancies available within INFOR Commons were evaluated and proposals were received and reviewed from building management. Neighboring buildings located in downtown Saint Paul were also evaluated. After reviewing lease proposals and buildout costs, it is our recommendation to relocate the Port Authority’s offices to Treasure Island Center. It is the best overall proposal, meets financial goals and advancing the Port Authority’s mission. This opportunity realizes a significant cost savings in rent over the next twelve years and represents best practices in the commercial real estate market to occupy space in a building that occupant has an ownership stake. There are Pros and Cons of this proposal: Pros include:

Moving allows a local business (MRO) to achieve its expansion goals within Saint Paul.

With the current COVID-19 issues facing all office tenants, physical space can be created that provides state of the art systems that can address health concerns and improve wellness of staff.

This will be a modified gross rental structure protecting the Port Authority from uncontrollable rental increases, while providing Go Wild (landlord) with annual adjustments.

The Port Authority becomes more accessible and more visible to the community. Ability to design a space that manifests the Port Authority’s mission and helps

retain and recruit talent, including wellness improvements, best practices for indoor environmental quality, energy efficiency and numerous sustainable design features.

Technology upgrades to allow for more flexible working conditions and rely more on cloud-based systems and design for flexibility and remote work integration.

Cons include: This is not a traditional office environment. In lieu of paying a base rental rate, the Port Authority will self-finance its tenant

improvements and will not receive a Tenant Improvement Allowance. The Port Authority will incur moving expenses and costs of furniture, fixtures,

and equipment (FFE) upgrades.

MEMORANDUM

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Recommendation: Approval authorizing the President or his designees to negotiate the final terms of, and enter into, a contingent lease agreement for office space for the Port Authority of the City of Saint Paul for a twelve-year term, with two five-year renewal options. Approval to self-finance tenant improvements in lieu of base rent, with total annual occupancy costs to remain at or below current occupancy costs at INFOR Commons, with the total self-financing portion not to exceed $1,250,000. Attachment: Resolution

Resolution No. 4678

RESOLUTION OF THE PORT AUTHORITY OF THE CITY OF SAINT PAUL

[PORT AUTHORITY OCCUPANCY]

WHEREAS, the Port Authority of the City of Saint Paul is a public body corporate and politic and a governmental subdivision organized pursuant to Chapter 469 of Minnesota Statutes.

WHEREAS, under Minn. Stat. § 469.055, the Port Authority shall (1) promote the

general welfare of the port district, and of the port as a whole; (2) try to increase the volume of the port's commerce; (3) promote the efficient, safe, and economical handling of the commerce; and (4) provide or promote adequate docks, railroad and terminal facilities open to all on reasonable and equal terms for the handling, storage, care, and shipment of freight and passengers to, from, and through the port.

WHEREAS, the Port Authority has been a tenant in the Lawson Commons building,

now known as INFOR Commons, since January of 2013, under a ten-year Lease. WHEREAS, a neighboring tenant has a need to take over the space currently

occupied by the Port Authority in order to expand and add 20-25 employees. WHEREAS, the Port Authority has investigated and evaluated proposals for office

spaces available from INFOR Commons and multiple neighboring buildings located in downtown Saint Paul and after review of the proposals and buildout costs, it recommends relocating the Port Authority’s offices to the Treasure Island Center.

WHEREAS, staff recommends relocating to space in the Treasure Island Center as

it presents a cost savings in rent as the Port Authority would occupy space in a building that it has an ownership stake in, allows a local business to achieve its expansion goals within Saint Paul, makes the Port more accessible and visible to the community, will allow for more flexible working conditions and will grant the Port Authority the ability to design a space that manifests the Port’s mission and helps retain and recruit talent, including wellness improvements and energy efficiency.

WHEREAS, the Port Authority recommends approval of the staff to negotiate the final

terms of, and enter into, a twelve-year lease term, with two five-year renewal options. WHEREAS, the Port Authority recommends approval to self-finance tenant

improvements in lieu of base rent, with total annual occupancy costs to remain at or below current occupancy costs, with the total self-financing portion not to exceed $1,250,000.

NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS

OF THE PORT AUTHORITY OF THE CITY OF SAINT PAUL, that the Port Authority is authorized to negotiate the final terms of, and enter into, a twelve-year lease term, with two five-year renewal options for space in the Treasure Island Center with Go Wild, LLC; and

Resolution No. 4678 Page 2

BE IT FURTHER RESOLVED, that the Port Authority is approved and authorized to self-finance tenant improvements in lieu of base rent, with total annual occupancy costs to remain at or below current occupancy costs at INFOR Commons, with the total self-financing portion not to exceed $1,250,000; and

BE IT FURTHER RESOLVED, that the President or anyone acting under his direction

is hereby authorized and directed to execute any and all necessary documents to complete the transaction.

Adopted: June 23, 2020

PORT AUTHORITY OF THE CITY OF SAINT PAUL

By Its Chair ATTEST: By Its Secretary