HomeMy WebLinkAboutCity Council Resolution 2023-206
C ITY OF P LYMOUTH
R ESOLUTION N O. 2023-206
R ESOLUTION A PPROVING THE T ERMS OF UP TO A $20,000,000 I NTERFUND L OAN IN
C ONNECTION WITH A P ROPOSED T AX I NCREMENT F INANCING D ISTRICT (P RUDENTIAL –
C HANKAHDA T RAIL R ECONSTRUCTION – P HASE III P ROJECT)
WHEREAS, the City of Plymouth, Minnesota (the "City") may establish a Tax Increment Financing
District (the "TIF District") within a Development District and may adopt a tax increment financing plan
for the TIF District (the "TIF Plan"); and
WHEREAS, the City may pay for certain costs to be identified in the TIF Plan consisting of land
acquisition, public utilities, site improvements/preparation, other eligible improvements, and
administrative costs (the "Qualified Costs") incurred in connection with the establishment of the TIF
District and development of land within the TIF District, all related to the Prudential – Chankahda Trail
Reconstruction – Phase III project designated by the City, which costs may be financed on a temporary
basis from City funds available for such purposes; and
WHEREAS, under Minnesota Statutes, Section 469.178, Subd. 7, the City is authorized to
advance or loan money from the City's general fund or any other fund from which such advances may
be legally made, in order to finance the Qualified Costs; and
WHEREAS, the City intends to reimburse itself for the payment of the Qualified Costs, plus
interest thereon, from tax increments derived from the TIF District in accordance with the terms of this
resolution (which terms are referred to collectively as the "Interfund Loan").
NOW, THEREFORE, BE IT HEREBY RESOLVED, by the City Council of the City of Plymouth, as
follows:
1. Terms of Interfund Loan.
a. The City hereby authorizes the advance of up to $20,000,000 from the City's General Fund
or any other fund designated by the City, or so much thereof as may be paid as Qualified
Costs. The City shall reimburse itself for such advances together with interest at the rate
stated below. Interest accrues on the principal amount from the date of each advance. The
maximum rate of interest permitted to be charged is limited to the greater of the rates
specified under Minnesota Statutes, Section 270C.40 or Section 549.09 as of the date the
loan or advance is authorized, unless the written agreement states that the maximum
interest rate will fluctuate as the interest rates specified under Minnesota Statutes, Section
270C.40 or Section 549.09 are from time to time adjusted. The interest rate shall be 5.00%
and will not fluctuate.
b. Principal and interest on the Interfund Loan (the "Payments") shall be paid annually on each
December 31 commencing with the date the tax increments from the TIF District are
available and not otherwise pledged to and including the earlier of (i) the date the principal
and accrued interest of the Interfund Loan is paid in full, or (ii) the date of last receipt of tax
Resolution 2023-206
Page 2
increment from the TIF District ("Payment Dates") which Payments will be made in the
amount and only to the extent of available tax increments. Payments shall be applied first
to accrued interest, and then to unpaid principal.
c. Payments on the Interfund Loan are payable solely from the tax increment generated in the
preceding twelve (12) months with respect to the TIF District and remitted to the City by
Hennepin County, all in accordance with Minnesota Statutes, Sections 469.174 to 469.1794,
as amended. Payments on this Interfund Loan are subordinate to any outstanding or future
bonds, notes or contracts secured in whole or in part with tax increment, and are on parity
with any other outstanding or future interfund loans secured in whole or in part with tax
increments.
d. The principal sum and all accrued interest payable under this Interfund Loan are pre-payable
in whole or in part at any time by the City without premium or penalty. No partial
prepayment shall affect the amount or timing of any other regular payment otherwise
required to be made under this Interfund Loan.
e. The Interfund Loan is evidence of an internal borrowing by the City in accordance with
Minnesota Statutes, Section 469.178, Subd. 7, and is a limited obligation payable solely from
tax increment pledged to the payment hereof under this resolution. The Interfund Loan and
the interest hereon shall not be deemed to constitute a general obligation of the State of
Minnesota or any political subdivision thereof, including, without limitation, the City.
Neither the State of Minnesota, nor any political subdivision thereof shall be obligated to
pay the principal of or interest on the Interfund Loan or other costs incident hereto except
out of tax increment, and neither the full faith and credit nor the taxing power of the State
of Minnesota or any political subdivision thereof is pledged to the payment of the principal
of or interest on the Interfund Loan or other costs incident hereto. The City shall have no
obligation to pay any principal amount of the Interfund Loan or accrued interest thereon,
which may remain unpaid after the termination of the TIF District. The City may amend the
terms of the Interfund Loan at any time by resolution of the City Council, including a
determination to forgive the outstanding principal amount and accrued interest to the
extent permissible under law.
2. Effective Date. This resolution is effective upon the date of its approval.
APPROVED by the City Council on this 8th day of August, 2023.
Resolution 2023-206
Page 3
STATE OF MINNESOTA)
COUNTY OF HENNEPIN) SS
The undersigned, being the duly qualified and appointed City Clerk of the City of Plymouth, Minnesota,
certifies that I compared the foregoing resolution adopted at a meeting of the Plymouth City Council on
August 8, 2023, with the original thereof on file in my office, and the same is a correct transcription
thereof.
WITNESS my hand officially as such City Clerk and the Corporate seal of the city this ________day of
_______________________, 2023.
__________________________________
City Clerk