St. Paul Mayor Melvin Carter plans to provide money for a $10 million affordable housing trust fund next year by selling a 1,170-stall downtown parking ramp across from the Minnesota Children’s Museum.

The city of St. Paul may be less than a week away from closing on the sale of the municipal ramp to the owners of Wells Fargo Place, formerly known as the World Trade Center.

The pending sale has alarmed museum officials, who have been guaranteed 150 parking stalls at a discounted rate since the museum opened downtown in 1995, shortly before the city negotiated a bond investment with neighboring property owners that allowed the owners to buy the ramp after 20 years. The museum recently completed an expansion.

“We were not aware of the arrangement that was put in place back in 1997,” said Children’s Museum President Dianne Krizan. “Certainly, having affordable and convenient parking for our visitors is essential. That’s the main thing.”

“We look forward to solidifying the parking arrangement with the new owner,” she added. “We’ve had conversations with them, and they’re waiting until the sale is complete to talk about the terms going forward. The ramp is important to our visitors, but the visitors are also important to the ramp.”

Since 2006, the 37-story Wells Fargo Place has been owned and managed by the Unilev Management Corp., a national building management firm based in Houston. Its capital and management headquarters is based in Beverly Hills, Calif.

With debts mounting, Unilev put Wells Fargo Place up for sale in 2016. Unilev, however, scored a $90 million financing package in January, saving them from defaulting on a previous loan.

It’s unclear whether Unilev approached the city first or if the city approached Unilev, but the timing coincides with one of the mayor’s budget priorities.

Carter highlighted affordable housing this month as a key issue in his 2019 budget proposal, which calls for the city to establish a new $10 million affordable housing trust fund. Proceeds from the ramp sale would go toward the fund.

City officials say the parking ramp sale was set in motion 20 years ago through long-standing bond agreements. In those agreements, the owners of the World Trade Center were offered the option to buy the ramp after two decades. However, ownership of the WTC building has since changed hands multiple times, and the option was all but forgotten by most parties — until now.

“The sale of the ramp was outlined in an option agreement executed in 1997 when the ramp was expanded between the (St. Paul Housing and Redevelopment Authority) and the Wells Fargo Place owner,” said Peter Leggett, a spokesman for the mayor’s office.

Ramsey County property records show an estimated market value of roughly $14 million, though it could sell for more or less than that depending upon the findings of independent appraisers. The ramp pays street maintenance assessments to the city, but no property taxes. In the hands of a private owner, it’s likely that would change, and the ramp could return to the tax rolls.

A PARKING ENTICEMENT

The city helped to build the ramp in the late 1980s with public “tax-increment financing” in order to entice the Children’s Museum to move downtown from the Bandana Square business district.

The TIF agreement, finalized in 1991, included 150 dedicated parking stalls for the museum at a discounted rate. In addition, the museum was guaranteed 80 percent of the parking income from those spaces.

The museum moved downtown in 1995.

The ramp, which opened in 1987, expanded in 1997 to 1,170 spaces with the assistance of the Principal Mutual Life Insurance Co., which owned the World Trade Center at the time. The life insurance company bought into public revenue bonds, with the option to acquire the ramp after 20 years.

The 20 years has come and gone, and the tower has been sold more than once during that time. Meanwhile, the TIF agreement between the Children’s Museum and the city expired in 2012.

The owners of Wells Fargo Place have decided to exercise the option to buy the parking ramp.

The city and tower owner have completed an appraisal process and appear to be days away from closing on a sale, which would need the approval of the City Council.

On July 25, the council, meeting as the Housing and Redevelopment Authority, approved a temporary arrangement for revenue sharing with the Children’s Museum while the sale is being negotiated.

As of June 1, the HRA has been operating the ramp through an agreement with Allied Parking.

“The council is aware that negotiations are underway,” said Council President Amy Brendmoen. “My understanding is the facility will remain a ramp in any event.”

Krizan, the Children’s Museum president, declined to detail how much money the museum draws from the ramp annually, but called it “meaningful revenue.”

“We just invested in downtown St. Paul, and we’re just eager to come to an agreement with the new owner,” she said. “And we’re also being proactive about exploring agreements with other ramps in the area to make sure our museum visitors are well served.”