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HomeMy WebLinkAboutResolution - 2000-84 - Preliminary Approval - Micro Dynamics Corporation Project - Minnesota Industrial Development Revenue Bonds - 06/06/2000 CITY OF EDEN PRAIRIE HENNEPIN COUNTY,MINNESOTA RESOLUTION NO.2000-84 RESOLUTION RECITING A PROPOSAL FOR AN INDUSTRIAL DEVELOPMENT PROJECT GIVING PRELIlVIlNARY APPROVAL TO THE PROJECT PURSUANT TO THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT SUBJECT TO HOLDING A PUBLIC HEARING AND AUTHORIZING THE PREPARATION OF NECESSARY DOCUMENTS AND MATERIALS IN CONNECTION WITH SUCH PROJECT (1VIICRO DYNAMICS CORPORATION) WHEREAS, (a) The purpose of Minnesota Statutes, Sections 469.152 to 469.165 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 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 governmental services 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 Eden Prairie(the"City")has received from Micro Dynamics Corporation, a Minnesota corporation(the "Company") a proposal that the City undertake to finance a Project hereinafter described, through the issuance of revenue bonds (hereinafter the 'Bonds")pursuant to the Act; (d) The City desires to facilitate the selective development of the community, retain and improve the tax base and help to provide the range of services and employment opportunities required by the population; and the Project will assist the City in achieving those objectives. The Project will 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 community; (e) The Project to be financed by the Bonds is(i)acquisition of land and an existing approximately 50,000 square foot building located at 6201 Bury Drive in Eden Prairie, (ii) renovation of the building and (iii) acquisition and installation of electronics manufacturing equipment. The Company currently employs 50 people and it is expected that approximately 25 additional persons will be employed following completion of the Project; (f) The City has been advised by representatives of Company 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; (g) Prior to final approval of any financing the City must hold a public hearing with respect to the Project as required by Section 469.154, Subdivision 4,of the Act and the Internal Revenue Code; and (h) No public official of the City has either a direct or indirect financial interest in the Project nor will any public official either directly or indirectly benefit financially from the Project. NOW, THEREFORE,BE IT RESOLVED by the City Council of the City of Eden Prairie, Minnesota, as follows: 1. The Council hereby gives preliminary approval to the proposal of Company that the City undertake the Project pursuant to the Act, subject to holding a public hearing with respect to the Project, and to the proposal that the City and the Company enter into a revenue agreement between the City and Company 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 Bonds in the total principal amount of approximately$4,500,000 to be issued pursuant to the Act and on a tax-exempt or taxable basis, or a combination thereof, to finance the acquisition,renovation and equipping of the Project; and such agreement may also provide for the entire interest of Company in the Project to be mortgaged to the purchaser of the Bonds or a credit enhancement provider; and the City hereby undertakes preliminarily to issue its Bonds in accordance with such terms and conditions, subject to holding a public hearing with respect to the Project. 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 2(a)of Section 469.153 of the Act;that the Project furthers the purposes stated in Section 469.152; that the availability of the financing under the Act and willingness of the City to furnish such financing will be a substantial inducement to Company 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 the tax base and to provide the range of service and employment opportunities required by the 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 eventually to increase the tax base of the community. 3. The Project is hereby given preliminary approval by the City subject to holding a public hearing, the approval of the Project by the Minnesota Department of Trade and Economic Development ("DTED"), and final approval by this Council, Company, and the purchaser of the Bonds as to the ultimate details of the financing of the Project. 4. The City staff is hereby authorized and directed to publish notice of a public hearing with respect to the Project in accordance with Section 469.154 Subdivision 4 of the Act. 5. Company 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 DTED will be paid by Company. 6. Briggs and Morgan,Professional Association, acting as bond counsel,is authorized to assist in the preparation and review of necessary documents relating to the Project,to consult with the City Attorney, Company and the purchaser of the Bonds as to the maturities,interest rates and other terms and provisions of the Bonds and as to the covenants and other provisions of the necessary documents and to submit such documents to the Council for final approval. 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 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 by DTED 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 Company is hereby authorized to make or to reimburse itself for such expenditures and advances toward payment of that portion of the costs of the Project as Company consider necessary,including the use of interim,short-term financing,subject to reimbursement from the proceeds of the Bonds if and when delivered but otherwise without liability on the part of the City. 9. 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 Company. The City retains the right in its sole discretion to withdraw from participation and accordingly not to issue the Bonds,or issue the Bonds in an amount less than$4,500,000 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 issue the Bonds in the amount of $4,500,000,or should the parties to the transaction be unable to reach agreements as to the terms and conditions of any of the documents required for the transaction. 10. All commitments of the City expressed herein are subject to the condition that the City and the Company shall have agreed to mutually acceptable terms and conditions of the loan agreement,the Bonds, and of the other instruments and proceedings relating to the Bonds and that the closing of the issuance and sale of the Bonds shall have occurred by no later than December 31, 2000. If the events set forth herein do not take place within the time set forth above, or any extension thereof, and the Bonds are not sold within such time,this resolution shall expire and be of no further effect. Adopted by the City Council of the City of Eden Prairie,Minnesota, this 6' day of June, 2000. IV 96z��� an L.Hams,Mayor Attested to by: Ka6leen Porta, City Clerk STATE OF MINNESOTA COUNTY OF BENNEPIN CITY OF EDEN PRAIlRJE I, the undersigned, being the duly qualified and acting Clerk of the City of Eden Prairie,Minnesota,DO HEREBY CERTIFY that I have compared the attached and foregoing extract of minutes with the original thereof on file in my office,and that the same is a full,true and complete transcript of the minutes of a meeting of the City Council of said City duly called and held on the date therein indicated,insofar as such minutes relate to a resolution giving preliminary approval to an industrial development project. WITNESS my hand this 6th day of June,2000. Ka een Porta, City Clerk