HomeMy WebLinkAboutCity Council Resolution 2014-390CITY OF PLYMOUTH
HENNEPIN COUNTY
STATE OF MINNESOTA
Councilmember Johnson introduced the following resolution and moved its adoption:
RESOLUTION NO. 2014-390
RESOLUTION AUTHORIZING AN INTERFUND LOAN FOR A
REFINANCING OF CERTAIN OBLIGATIONS PAID FROM TAX INCREMENT
FINANCING DISTRICT NO. 1-1.
BE IT RESOLVED by the City Council of the City of Plymouth, Minnesota (the "City"), as
follows:
Section 1. Background.
1.01. The City Council previously established Tax Increment Financing District No. 1-1 (the "TIF
District") and adopted a Tax Increment Financing Plan (the "TIF Plan") and the Housing and
Redevelopment Authority (the "HRA") is the administrative authority for the TIF District.
1.02. The City previously issued General Obligation Tax Increment Bonds, Series 2005A (the
"Bonds") pursuant to a pledge agreement with the HRA in order to pay for certain costs identified in the
TIF Plan consisting of site improvements, other qualifying improvements, interest and administrative
costs (collectively, the "Qualified Costs").
1.03. Under Minnesota Statutes, Section 469.178, Subd. 7, the City and HRA are authorized to
advance or loan money from their general funds or any other fund from which such advances may be
legally authorized, in order to finance or refinance the Qualified Costs.
1.04. The Bonds are prepayable on February 1, 2015. In order to reduce interest costs and
provide flexibility in future pre -payment options, the City and HRA intend to utilize City funds to pay off
all $835,000 in remaining principal on the Bonds on February 1, 2015 and create a new obligation for the
TIF District in accordance with the terms of this resolution (which terms are referred to collectively as the
"Interfund Loan").
Section 2. Terms of Interfund Loan.
2.01. The City hereby authorizes the advance of up to $900,000, or so much thereof as may be
necessary for outstanding Bond principal and any associated administrative or accrued interest costs, from
the CON -400 Construction Improvement Fund or such other fund identified by the City Manager. The
City shall be reimbursed with future tax increment revenues from the TIF District with interest at 4% and
such rate will not fluctuate in the future.
2.02. Principal and interest ("Payments") on the Interfund Loan shall be paid semi-annually on
each August 1 and February 1 (each a "Payment Date"), commencing on August 1, 2015, or on any other
dates determined by the City Manager, through the date of last receipt of tax increment from the TIF
District.
2.03. Payments on this Interfund Loan are payable solely from "Available Tax Increment,"
which shall mean, on each Payment Date, tax increment available after other obligations have been paid,
or as determined by the HRA Executive Director, generated in the preceding six (6) months with respect
to the property within the TIF District and remitted to HRA by Hennepin County, all in accordance with
Minnesota Statutes, Sections 469.174 to 469.1799, all inclusive, as amended. Payments on this Interfund
Loan may be subordinated to any outstanding or future bonds, notes or contracts secured in whole or in
part with Available Tax Increment, and are on parity with any other outstanding or future interfund loans
secured in whole or in part with Available Tax Increment.
2.04. 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 and HRA 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.
2.05. This Interfund Loan is evidence of an internal borrowing in accordance with Minnesota
Statutes, Section 469.178, Subd. 7, and is a limited obligation payable solely from Available Tax
Increment pledged to the payment hereof under this resolution. The HRA shall have no obligation to pay
any principal amount of the Interfund Loan or accrued interest thereon, which may remain unpaid after
the final Payment Date, other than tax increments from the TIF District.
2.06. The City Council may amend the terms of this Interfund Loan at any time by resolution,
including a determination to forgive and/or prepay the outstanding principal amount and accrued interest
to the extent permissible under law.
Section 3. Effective Date. This resolution is effective upon the date of its approval and upon receipt
of a pledge of tax increment payments from the TIF District by the HRA Board.
The motion for the adoption of the foregoing resolution was duly seconded by Councilmember
Bildsoe, and upon a vote being taken thereon, the following voted in favor thereof:
and the following voted against the same:
ADOPTED this 9th day of December, 2014.
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
December 9, 2014 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
City Clerk