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HomeMy WebLinkAboutCity Council Resolution 1978-195WUNIM NO. 78-195 • Member Spaeth introduced the following resolution and moved its adoption: RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROJECT UNDER THE MUNICIPAL INDUS- TRIAL DEVELOPMENT ACT, REFERRING THE PROPOSAL TO THE COMMISSIONER OF SECURITIES FOR APPROVAL, AND AUTHORIZING EXECUTION OF A MEMORANDUM OF AGREEMENT AND PRE- PARATION OF NECESSARY DOCUMENTS BE 1T RESOLVED by the City Council of the City of Plymouth, Minnesota, as follows: 1. It is hereby found, determined and declared as follows: 1.1. The welfare cf the State of Minnesota requires active promotion, attraction, encouragement and development of economically sound industry and commerce through governmental acts to prevent, so far as possible, emergence of blighted lands and areas of chronic unemployment, and the state has encouraged local government units to act to prevent such economic deteriora- tion. 1.2. Three H Investments, a limited partnership . (hereinafter, the Partnership), has advised this Council of its desire to acquire certain land, comprising approximately 11 acres within the City, and to construct and equip thereon a building of approximately 135,000 square feet (such land, building and equipment being hereinafter referred to as the Project), to be leased by the Partnership to F. C. Hayer Company, a Minnesota corporation (hereinafter, the Company), for use by the Company as an office and distribution center for appliances. 1.3. The existence of the Project within the City would significantly increase the tax base of the City, County and school district in which the City is located, and would provide opportunities for employment for residents of the City and surrounding area. 1.4. The City has been advised 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 that with the aid of municipal financing, and its resulting low borrowing cost, the Project is economically more feasible. 1.5. This Council has been advised by a representa- tive of Dain, Kalman & Quail, Incorporated, of Minneapolis, . Minnesota, investment bankers and dealers in municipal bonds, that on the basis of information submitted to them and their W W discussions with representatives of the Partnership, the Com- pany and potential buyers of tax-exempt bonds, industrial development revenue bonds of the City could be issued and sold upon favorable rates and terms to finance the Project. 1.6. The City is authorized by Minnesota Statutes, Chapter 474, to issue its revenue bonds to finance capital projects consisting of properties used and useful in connection with a revenue producing enterprise, such as that of the Part- nership, and the issuance of such bonds by the City would be a substantial inducement to the Partnership to construct its facility within the City. 2. On the basis of information given the City to date, it appears that it would be in the best interest of tho Citi• to issue its industrial development revenue bonds under the pl-ovisions of Chapter 474 to finance the Project of the Partnership at a cost presently estimated to be approximately $2,500,000. 3. The Project above referred to is hereby given pre- liminary approval by the City and the issuance of bonds for such purpose and in such amount approved, subject to approval of the Project by the Commissioner of Securities and to the mutual agree- ment of this body, the Partnership, the Company and the initial purchasers of the bonds as to the details of the bond issue and provisions for their payment. In all events, it is understood, however, that the bonds of the City shall not constitute a charge, lien or encumbrance legal or equitable upon any property of the City except the Project, and each bond, when, as, and if issued, shall recite in substance that the bond, including interest thereon, is payable solely from the revenues received from the Project and property pledged to the payment thereof, and shall not constitute a debt of the City. 4. The form of Memorandum of Agreement relating to the issuance of revenue bonds of the City to finance the cost of the Project is hereby approved and the Mayor and City Manager are hereby authorized and directed to execute the Memorandum of Agree- ment in behalf of the City. 5. In accordance with Minnesota Statutes, Section 474.01, Subdivision 7, the Mayor and the City Manager are hereby authorized and directed to submit the proposal for the Project to the Commis- sioner of Securities for his approval of the Project. The Mayor, City Manager, City Clerk, City Attorney and other officers, employees and agents of the City are hereby authorized to provide the Com- missioner with any preliminary information he may need for this purpose, and the City Attorney is authorized to initiate and assist in the preparation of such documents as may be appropriate to the Proiect, if it is approved by the Commissioner. oz/�/� / I i� Mayor e' Attest: City Clerk J The motion for the adoption of the foregoing resolution was duly seconded by Member Neils , and the following voted in favor thereof: r-1yor Hunt, C, uncllmembeis Hoyt, Neils and Spaeth and the following voted against the same: Councilmember Seibold whereupon said resolution was declared duly passed and adopted. -3-