HomeMy WebLinkAboutCity Council Resolution 1984-840RESOLUTION NO. 3A-840
. RESOLUTION GIVING PRELIMINARY APPROVAL TO A
PROJECT WITH NATHAN LANE ASSOCIATES UNDER THE
MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT
ACP, GIVING PRELIMINARY APPROVAL FOR THE
ISSUANCE OF COMMERCIAL DEVELOPMENT REVENUE
BONDS TO FINANCE THE PROJECT, AUTHORIZING
THE SUBMISSION OF AN APPLICATION FOR APPROVAL
OF SAID PROJECT TO THE ENERGY AND ECONOMIC
DEVELOPMENT AUTHORITY OF THE STATE OF MINNESOTA
AND AUTHORIZING THE PREPARATION OF NECESSARY
DOCUMENTS
WHEREAS, 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 eound
industry and commerce to prevent, so far as possible, the
emergence of blighted and marginal la:As and areas of chronic
unemployment; and
WHEREAS, factors necessitating the active promotion and
development of economically sound industry and commerce are the
increasing concentration of population in the metropolitan areas,
the rapidly rising increase in the amount and cost of governmental
services required to meet the needs of the increased population
and the need for development of land use which shall provide an
adequate tax base to finance these increased costs and access to
employment opportunities for such population; and
WHEREAS, the City Council (the "Council") of the City of
Plymouth, Minnesota (the "City"), has received from Nathan Lane
Associates, a Minnesota general partnership (the "Borrower"), a
proposal that the City undertake to finance a Project (as
hereinafter described) through the issuance of revenue bonds (the
"bonds") pursuant to the Act; and
WHEREAS, the City desires to facilitate the selective
development of the community, retain and improve its tax base and
help provide the range of services and employment opportunities
required by its population, and the Project shall assist the City
in achieving those objectives. The Project shall help to increase
assessed valuation of the City and help maintain a positive
relationship between assessed valuation and debt and enhance the
image and reputation of the City; and
WHEREAS, the Project to be financed by the bonds is the
acquisition of land and the acquisition and construction thereon
of an approximately 75,000 square foot office and warehouse
facility constituting an addition to an existing facility owned by
the Borrower at 1035-1065 Nathan Lane North in the City and to be
leased to Minter -Weisman Co., a Minnesota corporation (the
"Project"), and shall result in the employment of additional
persons to work within the new facilities; and
WHEREAS, the City has been advised by representatives of
the Borrower that conventional commercial financing to pay the
capital cost of thw 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 and that the Project would
not be undertaken but for the availability of industrial
development bond financing.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY
AS FOLLOWS:
1. The Council hereby ratifies the publication of the
notice calling for a public hearing on the Project, which was held
on December 3, 1984, and at which public hearing all interested
parties were afforded an opportunity to express their views, and
gives preliminary approval to the proposal of the Borrower that
the City undertake the Project pursuant to the Minnesota Municipal
Industrial Development Act, Chapter 474, Minnesota Statutes (the
"Act"), pursuant to the Borrower's specifications su tab a 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 estimated
maximum principal amount of $3,800,000, to be issued pursuant to
the Act to finance the costs of the Project, and the 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.
2. On the basis of information available to this Council,
it appears and the Council hereby finds that the 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 la 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
shall be a substantial inducement to the Borrower to undertake the
Project; that, based upon representations of the Borrower, the
Project would not be undertaken but for the availability of
industrial development bond financings and that the effect of the
Project, if undertaken, shall 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
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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 intensivs development and use of
land within the City and to eventually increase the City's tax
base.
3. The Project is hereby given preliminary approval by
the City, subject to the approval of the Project by the Minnesota
Energy and Economic Development Authority (the "Authority"),
obtaining an allocation for private activity bonds and 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 7a of Section 474.01,
Minnesota Statutes, the City Manager is hereby authorized and
directed to submit the proposal for the above-described Project to
the Authority, requesting the Authority's approval, and other
officers, employees and agents of the City are hereby authorized
to provide the Authority with such preliminary information as the
Authority 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 take such action
as is necessary to obtain or maintain an allocation of the federal
limit on private activity bonds, pursuant to Minnesota Laws for
1984, Chapter 582, and 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 Authority receives an
allocation as to the federal limits on private activity bonds and
this Council gives its final approval thereto, the Project may be
carried forward expeditiously. The City does not hereby allocate
or commit to allocate any of its allocation with respect to
federal limits on private activity bonds, but will consider a
request for an allocation by the Borrower in the year in which the
Borrower proposes to request the issuance of the Bonds.
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, whether or not the bonds or operative instruments are
executed and whether or not approved by the Commissioner, shall be
paid by the Borrower.
6. The adoption of this resolution does not constitute a
guarantee or a firm commitment that the City will issue the bonds
as requested by the Borrower. The City retains the right in its
sole discretion to withdraw from participation and accordingly not
issue the bonds should the City at any time prior to the issuance
thereof determine that it is in the best interest of the City not
to issue the bonds or should the parties to the transaction be
unable to reach agreement as to the terms and conditions of any of
the documents required for the transaction.
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• 7. Nothing in this resolution or in the documents
prepared pursuant hereto shall 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 shall 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 shall 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 shall recite in substance that the bonds,
including interest thereon, are payable solely from the revenue
and proceeds pledged to the payment thereof. The bonds shall not
constitute a debt of the City within the meaning of any
constitutional or statutory limitation.
8. In anticipation of the approval of the Authority and
the issuance of the bonds to finance all or a portion of the
Project and in order that completion of the Project shall not be
unduly delayed when approved, the Borrower may 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, to be reimbursed from the proceeds of the
bonds if and when delivered, but the City shall in no event be
liable for payment of, or in any respect with regard to, any such
expenditures whether or not bonds are issued or whether or not the
City gives final approval to the issuance of bonds, except such
costs may be paid from bond proceeds if and when such bonds are
issued.
Approved and adopted by the City Council this 3rd day of
December, 1984.
ATTEST:
City Manager
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Mayor