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HomeMy WebLinkAboutRES 80-077 RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROJECT WITH LOREN SWANSON UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, GIVING PRELIMINARY APPROVAL FOR THE ISSUANCE OF REVENUE BONDS TO FINANCE THE PROJECT, AUTHORIZING THE SUBMISSION OF Meeting Sheet IIIIIIVIIIVIIIVIIIVIIIVIIIIIIIIIII ionzz Box: 23 Folder: RES 1980 Document: RES 80-077 RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROTECT WITH LOREN SWANSON UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, GIVING PRELIMINARY APPROVAL FOR THE ISSUANCE OF REVENUE BONDS TO FINANCE THE PROJECT, AUTHORIZING THE SUBMISSION OF Resolution No. 80-077 RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROJECT WITH LOREN SWANSON UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, GIVING PRELIMIARY APPROVAL FOR THE ISSUANCE OF REVENUE BONDS TO FINANCE THE PROJECT, AUTHORIZING THE SUBMISSION OF AN APPLICATION FOR APPROVAL OF SAID PROJECT TO THE COMMISSIONER OF SECURITIES OF THE STATE OF MINNESOTA AND AUTHORIZING THE PREPARATION OF NECESSARY DOCUMENTS WHEREAS, (a) The purpose of Chapter 474, Minnesota Statutes, known as the Minnesota Municipal Industrial Development Act (the "Act" ) , as found and determined by the legislature is to promote the welfare of the State of Minnesota (the "State" ) by the active attraction and encouragement and development of economically sound industry and commerce to prevent so far as possible the emergence of blighted and marginal lands and areas of chronic unemployment; (b) Factors necessitating the active promotion and development of economically sound industry and commerce are the increasing concentration of population in the metropolitan areas and the rapidly rising increase in the amount and cost of govern- mental sei.vices required to meet the needs of. the increased population and the need for development of land use which will provide an adequate tax base to finance these increased costs and access to employment opportunities for such population; (c) The City Council of the City of St. Anthony ( the "City" ) has received from Loren Swanson (the "Borrower" ) a pro- posal that the City undertake to finance a Project hereinafter described, through the issuance of revenue bonds or notes ( the "Bonds" ) pursuant to the Act; (d) The City desires to facilitate the selective devel- opment of the community, retain and improve its tax base and help it provide the range of services and employment opportunities re- quired by its population, and said project will assist the City in achieving those objectives . Said project will help to increase assessed valuation of the City and help maintain a positive rela- tionship between assessed valuation and debt and enhance the image and reputation of the City; (e ) The Project to be financed by the Bonds is an approximately 11, 000 square-foot building to be leased by the Borrower to certain tenants, including Central Engineering Company, a Minnesota corporation, for use by them as an engineering and admininstration building, and consists of the • construction of a building and improvements thereon and the installation of equipment therein, and will result in the employment of additional persons to work within the new facilities; I (f) The City . has been advised by representatives of the Borrower that conventional. commercial financing to pay the capital • cost of the Project is available only on a limited basis and at such high costs of borrowing that the economic feasibility of operating the Project would be significantly reduced, but the Borrower has also advised this Council that with the aid of municipal financing and its resulting low borrowing cost the Project is economically more feasible. NOW THEREFORE, BE IT RESOLVED by the City Council (the "Council" ) of the City of St. Anthony, Minnesota, as follows: 1. The Council hereby gives preliminary approval to the proposal of the Borrower that the City undertake the Project pursuant to the Act, consisting of the acquisition, construc- tion and equipping of facilities within the City pursuant to the Borrower' s (or his affiliates) specifications suitable for the operations described above and to a revenue agreement between the City and the Borrower upon such terms and conditions with provisions for revision from time to time as necessary, so as to produce income and revenues sufficient to pay, when due, the principal of and interest on the proposed Bonds in the total principal amount of $1, 000, 000 to be issued pursuant to the Act to fi.-;ance the acquisition, construction and equipping of said Project and said agreement may also provide for the entire interest of the Borrower, therein to be mortgaged to the purchaser • of the Bonds; the City hereby undertakes preliminarily to issue its Bonds in accordance with such terms and conditions; and the City requires that its Bonds be sold to one or more institutions experienced in evaluating the type of credit involved, capable of bearing the financial risk and purchasing for investment purposes. 2. On the basis of information available to this Council, it appears and the Council hereby finds that said Project constitutes properties, real and personal, used or useful in connection with one or more revenue-producing enterprises engaged in any business within the meaning of Subdivision 1(a) of Section 474. 02, of the Act, that the availability of the financing under the Act and willingness of the City to furnish such financing will be a substantial inducement to the Borrower (or his affiliates) to undertake the Project and that the effect of the Project, if undertaken, will be to encourage the development of economically sound industry and commerce, to assist in the prevention of the emergence of blighted and marginal land, to help prevent chronic unemployment, to help the City retain and improve its tax base and provide the range of service and employment opportunities required by its population, to help prevent the movement of talented and educated persons out of the state and to areas within the State where their services may not be as effectively used, to promote more intensive development and use of land within the City and to eventually increase the City's tax base. • 2 1 3. Said Project is hereby given preliminary approval by the City subject to the approval of the Project by the Commissioner of Securities and subject to final approval by this • Council, the Borrower, and the purchaser or purchasers of the Bonds as to the ultimate details of the financing of the Project. 4 . In accordance with Subdivision 7(a) of Section 474 . 01, Minnesota Statutes, the Mayor of the City is hereby authorized and directed to submit the proposal for the above-described Project to the Commissioner of Securities, requesting her approval, and other officers, employees and agents of the City are hereby authorized to provide the Commissioner with such preliminary information as she may require. Representatives of the City and Lindquist & Vennum, as bond counsel , are hereby authorized, in cooperation with the Borrower and the Borrower' s counsel , to initiate the preparation of a proposed loan agreement, mortgage and such other documents as may be necessary or appropriate to the Project so that, when and if the proposed project is approved by the Commissioner and this Council gives its final approval thereto, the Project may be carried forward. expeditiously. . 5-. The Borrower has agreed and it is hereby determined that any and all costs incurred by the City in connection with the financing of the project, whether or not the Project is carried to completion and whether or not approved by the Commissioner, will be paid by the Borrower. 6 . Noshing in this resolution or in the documents pre- pared pursuant hereto will authorize the expenditure of any municipal. funds on the Project other than the revenues derived from the Project or otherwise granted to the City for this purpose. The Bonds will not constitute a charge, lien or encumbrance, legal or equitable, upon any property or funds of the City except the revenue and proceeds pledged to the payment thereof, nor shall the City be subject to any liability thereon . The holder or holders from time to time of the Bonds will never have the right to compel any exercise of the taxing power of the City to pay the outstanding principal on the Bonds or the interest thereon or to enforce payment thereof against any property of the City. The Bonds will recite in substance that the Bonds, including interest thereon, are payable solely from the revenue and proceeds pledged to the payment thereof. The Bonds will not constitute a debt of the City within the meaning of any constitutional or statutory limitation. 7. In anticipation of the approval of the Commissioner of Securities and the issuance of the Bonds to finance all or a portion of the Project and in order that completion of the Project will not be unduly delayed when approved, the Borrower is hereby authorized to make such expenditures and advances toward payment of that portion of the costs of the Project to be financed from the proceeds of the Bonds as the Borrower considers necessary, including the use of interim, short-term financing, subject to • reimbursement from the proceeds of the Note if and when delivered but otherwise without liability on the part of the City. 3 Approved and adopted this 28th day of October, 1980 . Mayor Clerk-Treasurer , • 4 STATEMENT CONCERNING A PROPOSED PROJECT UNDER ['MINNESOTA STATUTES, CHAPTER 474 • The undersigned, being the Mayor of the City of St. Anthony, Minnesota, certifies that the City Council of the City has been provided by Loren Swanson ( the "Borrower" ) , with certain information concerning a proposed Project under the Minnesota Municipal Industrial Development Act, Minnesota Statutes, Chapter 474 . On the basis of such information the City Council, by resolution adopted October 28, 1980, has given preliminary approval to the proposed Project and the financing thereof by the issuance of a revenue obligation or obligations of the City of St. Anthony ( the "City" ) . The following are factors considered by the Council in determining to give preliminary approval to said Proiect. • 1 . The Project consists generally of: An 11, 000 square foot engineering and administration building to be located in the City, all to be used by the Borrower as lessor to be leased to tenants, including Central Engineering Company, a Zl1:.nnesota corporation. 2. Bond Counsel is of the opinion that the Project consti- tutes a "project" within the meaning of Minnesota Statutes, Section 474 . 02, Subdivision 1. 3. The Borrower estimates that, based upon discussions with prospective tenants, upon completion of the Project, in excess of 30 persons will be employed at the Project, in addition to the number of people presently employed by the prospective tenants, which would provide increased employment opportunity for residents of the City and the surrounding area. • 4. The Borrower estimates that, based upon discussions with prospective tenants, the acquisition and construction of the Project will result in an additional annual payroll in excess of $450, 000 from tenancies, based on wage rates currently in effect. The City Council believes that a substantial percentage of that additional payroll will be spent on housing, food and other goods and services in the City and surrounding area, thus benefiting the local economy. 5. The City will provide the Minnesota Department of I Economic Development with the information required by Minnesota Statutes, Section 474. 01, Subdivision 8, upon entering into a , revenue agreement, as defined in the Act, with the Company. I 6 . The Project does not include any property to be sold or affixed to or consumed in the production of property for sale and does not include any housing facility to be rented or used as a j I permanent residence . 7. A public hearing on the proposal to and=rtake and finance the Project was conducted pursuant to Minnesota Statutes, Section i 474 . 01, Subdivision 7b, on October 28, 1980, at 7: 30 o' clock P.M. , in the Council Chambers in the St. Anthony City Hall, at which public hearing all interested parties were afforded an opportunity to express their views. �� , Mayor Octoberl , 1980.