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Home My WebLink AboutResolution - 81-242 - MIDB's - Sorem and Sherman - $1,000,000 - 12/19/1981 After all persons who wished to do so had stated their views on the proposal, the Mayor declared the hearing to be closed. After some discussion, Councilmember introduced the following resolution and (after it had been read in full ) (after the reading of the resolution was dispensed with by unanimous consent ) moved its adoption: RESOLUTION NO. g_L RESOLUTION RELATING TO THE AUTHORIZATION AND ISSUANCE OF REVENUE BONDS OF THE CITY UNDER MIENESOTA STATUTES , CHAPTER 474, FOR THE PURPOSE OF FINANCING A PROJECT THEREUNDER; AND AUTHORIZING AN APPLICATION BY THE CITY TO THE MINNESOTA COMMISSIONER OF SECURITIES BE IT RESOLVED by the City Council of the City of Eden Prairie , Minnesota, as follows: Section 1. Recitals . 1 . 01 . The LegiElature of the State of Minnesota in Minnesota Statutes, Chapter 474, as amended ( the Act ) , has found and declared that the welfare of the State requires active promotion, 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; has authorized municipalities to issue revenue bonds to finance, in whole or in part, the cost of the acquisition , construction, reconstruction, improvement and betterment of projects, including any properties , real or personal , used or useful in connection with a revenue producing enterprise engaged in any business ; and has authorized municipalities to enter into "revenue agreements", as defined in the Act, with any person, firm, or putlic or private corporation or federal or state governmental subdivision or agency (the Contracting Party ) providing for the payment by the Contracting Party of amounts sufficient to provide for the prompt payment of principal and interest cn the revenue bonds. 1 . 02 . It has been proposed that the City issue its revenue bonds, pursuant to the authority of the Act, (- in an amount not exceeding in the aggregate principal -3- amount $1 , 000, 000 , or such lesser amount as may be necessary , to finance costs of acquisition of land within the City and construction and equipping thereon of one or more buildings (the Project ) to be owned and operated by L. S . Sorem and William B . Sherman Partnership, a Minnesota general partnership ( the Partnership ) , and leased to L. S . Soren, & Associates , Inc. and Excel Marketing , Inc. , Minnesota corporations, for use as office and warehouse facilities ; and to make the proceeds of such sale available to the Partnership . The Partnership will agree to pay the City amounts sufficient to pay promptly the principal of and interest on the revenue bonds , and will agree to cause the Project to be completed. The Project is presently estimated to cost approximately $1, 000, 000. 1 . 03. The City has been advised that conventional, commercial financing to Fay the capital cost of the Project is available only on a limited .basis and at such high costs of borrowing that the scope of the Project or the economic feasibility of operating the Project would be significantly reduced, but that with the aid of municipal financing , and its resulting low borrowing costs, the Project can be constructed as designed and its operation is economically more feasible . Section 2. Public Hearing . 2 . 01. As required by Section 474 . 01, Subdivision 7b, of the Act, a public hearing on the proposal to undertake and finance the Project was called and held . Notice of the time and place of the hearing, and stating the general nature of the Project and an estimate of the principal amount of bonds to be issued to finance the Project , was published at least once not less than fifteen days nor more than thirty days prior to the date fixed for the hearing , in the official newspaper of the City and a newspaper of general circulation of the City . A draft copy of the proposed application to the !Minnesota Commissioner of Securities and Real Estate , together with all attachments and exhibits thereto, was available for putlic inspection following the publication of such notice at the place and times set forth in the notice . 2. 02. All parties who appeared at the public hearing were given an opportunity to express their views with respect to the proposal to undertake and finance the Project. This Council has heard and considered the views expressed at the public hearing and the information submitted to the City by the Partnership . t -4- Section 3 . Approvals and Authorizations . 3. 01 . On the tasis of information given the City to date, and the views expressed at the public hearing , it is found and determined that the Project furthers the purposes stated in Section 474 . 01 of the Act, and that it woulc be in the best interest of the City to issue its industrial development revenue bonds under the provisions of the Act to finance costs of the Project in an amount not to exceed $1 , 000 , 000 (the Bonds) . 3 . 02. The Project is hereby given preliminary approval by the City and the issuance of the Bonds for such purpose approved. The Bonds shall not be issued until the Project has been approved by the Commissioner of Securities , as provided by the Act, and until the City and the Partnership have agreed upon the details of the Bonds and provisions for their payment . 3 . 03 . If the Bonds are issued and sold, the City will enter into a lease , mortgage, direct or installment sale contract , loan agreement, take or pay or similar agreement, secured or unsecured, satisfying the requirements of the Act ( the Revenue Agreement ) with the Partnership. The amounts payable by the Partnership to the City under the Revenue Agreement will be sufficient to pay the principal, interest and redemption premium, if any, on the Bonds as and when the same shall become due and payable. 3. 04 . The Partnership 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 Commissioner of Securities ; whether or not the Project is carried to completion ; and whether or not the Bonds or Revenue Agreement and all other operative instruments are executed. 3. 05. 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 Partnership . 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 City , Partnership and any other 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- 3 . 06. In accordance with the Act , the Mayor and City Clerk are hereby authorized and directed to submit the proposal for the Project to the Minnesota Commissioner of Securities and Real Estate fcr her approval of the Project . The Mayor , City Clerk , City Attorney and other officers, emr- loyees and agents cf the City , in conjunction with Dorsey , Windhorst , Hannaford, Whitney & Halladay , Bond Counsel to the City , are hereby authorized to provide the Commissioner with any preliminary information she may need fcr this purpose, and the City Attorney is authorized to initiate and assist in the preparation of such documents as may to appropriate to the Project. 3 . 07 . The City will cause the Partnership to comply with all of the provisions of the Act, including Section 474 . 01 , Subdivision 8, thereof, in the issuance of the Bonds and the financing of the Project . 3 . 08 . All commitments of the City expressed herein are subject to the condition that within twelve months of the date of adoption of this Resolution the City and the Partnership 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, this Resolution shall expire and be of no further effect. Section 4. Special Obligations. In all events , it is understood, however , that the Bonds shall not constitute a charge, lien or encumbrance , legal or equitable , upon any property of the City except the Project , if it becomes the property of the City , and from the revenues received from the Project and property pledged to the payment thereof , and shall not constitute a debt of the City . Section 5. Effective Date . This resolution shall be effective immediately upon its final adoption. PASSED AND FINALLY ADOPTED by the C ' ty Council of the City of Eden Prairie, this 19th day I� cember , 1. Attest C"i,ty Clerk ftz� M yor ( -6- The motion for the adoption of the foregoing resolution was seconded ry Councilmember L� TL- and , upon vote being taken thereon, the following voted in favor thereof: � "� � � `' O � TtZ r� ~- � ��✓�Gc-j �2ra��re� and the following voted against the same: whereupon said resolution was declared duly passed and finally adopted and, was signed by the Mayor which was attested by the City Clerk . -7-