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HomeMy WebLinkAboutResolution - 80-102 - Giving Preliminary Approval to Project Under Municipal Development Act, Referring Proposal to Commissioner of Securities and Authorizing Preparation of Necessary Documents - Wilson Learning Center - � a Member Red path introduced the following resolution and moved its P g adoption: RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROJECT UNDER THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, REFERRING THE PROPOSAL TO THE COMMISSIONER OF SECURITIES FOR AP- PROVAL, AND AUTHORIZING PREPARATION OF NECESSARY DOCUMENTS $E IT RESOLVED by the City Council of the City of Eden Prairie, Minnesota, as follows: J. It is hereby found, determined and declared as follows: 1.1. The welfare of the State of Minnesota requires active promo- tion, 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 it is the policy of the State of Minnesota to facilitate and encourage action by local government units to prevent the economic deterioration of such areas to the point where the process can be reversed only by total redevelopment through the use of local, state and federal funds derived from taxation, with the attendant necessity of relocating displaced persons and of duplicating public services in other areas. 1.2. Technological change has caused a shift to a significant degree in the area of opportunity for educated youth to processing, transporting, marketing, service and other industries, and unless existing and related industries are retained and new industries are developed to use_the available resources of the City of Eden Prairie (the "City"), a large part of the existing investment- of the community and of the state as a whole in educational and public service facilities will be lost, and the movement of talented, educated personnel of mature age to areas where their'services may be effectively used and compensated and the lessening attraction of persons and businesses from other areas for purposes of industry, commerce and tourism will deprive the City and the State of the economic and human resources needed as a base for providing governmental services and facil- ities for the remaining population. 1.3. The increase in the amount and cost of governmental services requires the need for more intensive development and use of land to provide an adequate tax base to finance these costs. ' 1.4. Nilson Learning Corporation, a Minnesota corporation or its designee (hereinafter the "Applicant"), has advised this City Council (the "Council") that it desires to expand an existing building and acquire and install equipment therefor (hereinafter referred to as the "Project"). Y ' 1.5. The existence of the Project in the City will contribute to more intensive development and use of land to increase the tax base of the City and overlapping taxing authorities and maintain and provide for an increase in opportunities for employment for residents of the City. 1.6. The City has been advised that conventional, commercial financing to pay the capital cost of the Project is available at such 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 are economically more feasible. 1.7. This Council has been advised by representatives of Dain Bosworth Incorporated, as placement agent, that on the basis of information submitted to them and their discussions with representatives of area financial institutions 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. 1.8. The City is authorized by Minnesota Statutes, Chapter 474, to issue its revenue bonds to finance the cost, in whole or in part, of the acquisition, construction, reconstruction, improvement or extension of cap- ital projects consisting of properties used and useful in connection with a revenue producing enterprise, such as that of the Applicant, and the issuance of such bonds by the City would be a substantial inducement to the Applicant to construct its facility in the City. 2. On the basis of information given the City to date, it appears that it would be in the best interest of the City to issue its industrial development revenue bonds under the provisions of Chapter 474 to'finance the Project of the Applicant at a cost presently estimated not to exceed $1,750,000. 3. The Applicant has agreed to pay directly or through the City any and all costs incurred by the City in connection with the project whether or not the project is approved by the Commission of Securities; whether or not_the project is carried to completion; and whether or not the bonds or operative instruments are executed. 4. The adoption of this resolution does not constitute a guarantee or a firm commitment that the City will issue the bond as requested by the applicant. The City retains the right in its sole discretion to withdraw from participation and accordingly not issue the bond 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 bond 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. 5. The Project above referred to is hereby given preliminary 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 agreement of this body, the Applicant 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 such bonds of the City shall not be payable from nor charged upon any funds other than the revenue pledged to the payment thereof, nor shall the City be subject to any liability thereon, nor shall the bonds 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 2 revenues received from the Project and property pledged to the payment thereof, and shall not constitute a debt of the City. No holder or holders of such bonds shall ever have the right to compel any exercise of the taxing power of the City to pay 4 any such bonds or the interest thereon, nor to enforce payment thereof against any property of the City except the Project, or portion thereof, mortgaged or otherwise encumbered under the provisions and for the purpose of Minnesota Statutes, Chapter 474. 6. The City is hereby authorized to enter into any contracts, execute all instruments and do all things necessary or convenient in the exercise of the powers granted in Minnesota Statutes, Chapter 474, or in the performance of the covenants or duties of the City, or in order to secure the payment of the bonds of the City; and including entering into a contract authorizing the contracting party, subject to such terms and conditions as the City shall find necessary or dt.sirable and proper,; to provide for the construction, acquisition, and installation of the buildings, improvements, and equipment to be included in the Project by any means available to the contracting party and in the manner determined by the contracting party and without advertisement for bids as may be required for the construction or acquisition of other municipal facilities. 7. Dain Bosworth Incorporated, being familiar with the Project and the marketability of industrial development revenue bonds, has advised the Council that in its opinion the bonds in the approximate principal amount of $1,750,000 may be sold on terms and conditions satisfactory to the City and the Developer. 8. In accordance with Minnesota Statutes, Section 474.01, Subdivision • 7a, the Mayor of the City is hereby authorized and directed to submit the proposal for the Project to the Commissioner of Securities for her approval of the Project. The Mayor, Clerk, Treasurer and other officers, employees and agents of the City are hereby authorized to provide the Commissioner with any preliminary infor- mation she 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 Project, if it is approved by the Commissioner. 9. The law firm of Holmes & Graven, Chartered, is authorized to act as Bond Counsel and to assist in the preparation and review of necessary documents relating to the Project and bonds issued in connection therewith. 10. All commitments of the City expressed herein are subject to the condition that within twelve (12) months of the date of adoption of this resolution the City and the Applicant shall have agreed to mutually acceptable terms and conditions of the revenue agreement, the bonds and of the other instruments and proceedings relating to the bonds and their issuance and sale. 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, is resolution shall expire and be of no further force and effect. Mayor Attest• Clerk 3 a The motion for the adoption of the foregoing resolution was duly seconded 0 . by Member Edstrom and upon a vote being taken thereon, the following voted in r favor thereof: Pauly Edstrom Osterholt Redpath and the following voted against the same: None Whereupon said resolution was declared duly passed and adopted.