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HomeMy WebLinkAboutResolution - 84-194 - Preliminary Approval MIDB's - Gerald and Sarbara Portnoy - $2,750,000 - 08/28/1984 RESOLUTION RECITING A PROPOSAL FOR A COMMERCIFIL FACILITIES DEVELOPMENT PROJECT GIVING PRLGIMINARY APPROVAL TO THE PROJECT PURSUANT TO THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT AUTHORIZING THE SUBMISSION OF AN APPLICATION FOR APPROVAL OF THE PROJECT TO THE ENERGY AND ECONOMIC DEVELOPMENT AUTHORITY OF THE STATE OF MINNESOTA AND AUTHORIZING THE PREPARATION OF NECESSARY DOCUMENTS AND MATERIALS IN CONNECTION WITH THE PROJECT (PORTNOY PROJECT ) WIIPREAS, (a) 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 by the active attraction and encouragement and development of economi- cally 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 govarm-nental 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 Gerald Portnoy and Barbara Portnoy (the "Company") a proposal that the City assist in financing a Project hereinafter described, through the issuance of a Revenue Bond or Bonds or a Revenue Note or Notes hereinafter referred to in this resolution as "Revenue Bonds" pursuant to the Act; (d) The City desires to facilitate the selec- tive develocment of the community, retain and improve the tax base and help to provide the range of services and employment opportunities required by the popula4_ion; 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 Company is currently engaged in the business of owning and developing real estate. The Project to be financed by the Revenue Bonds is an approximately 50, 000 sq. ft . hi-tech office and office showroom facility to be located east of Highway 169 and south of Halley View Road (County Road 39 ) in Eden Prairie and consists of the acquisition of land and thf� construction of buildings and improvements thereon and the installation of equipment therein to be initially owned and operated by the Company, and will result in the employment of additional persons to work within the new facilities; ( f) The City has been advised by representa- tives 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, but Company has also advised this Council that with the aid of municipal. financing, and its resulting low borrowing cost, the Project is economically more feasible; (g) A public hearing on the Project was held on _ 1984, after notice was published, and materials made available for public inspection, all as required by Minnesota Statutes, Section 474.01 , Subdivision 7b at which public hearing all those appearing who so desired to speak were heard; (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 Minnesota Municipal Industrial Development Act (Chapter 47 , Minnesota Statutes) , consisting of the acqui- sition, construction and equipping of facilities within the City pursuer to Company ' s specifications suitable for the operations described above to be initially owned and operated by the Company and pursuant to 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 Revenue Bonds in the maximum aggregate principal amount of $2 ,750,000 to be issued pursuant to the Act to finance the acquisition, construction and equipping of the Project; and said agreement may also provide for the entire interest of Company therein to be mortgaged to the purchaser of the Revenue Bonds; and the City hereby undertakes preliminarily to issue its Revenue 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 Project furthers the purposes stated in Section 474.01 , Minnesota Statutes; that the availability of the financing under the Act and willingness of the City to furnish such financing will be a substtant=a.l 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 the approval of the Project by the Minnesota Energy and Economic Development Authority or such other state officer having authority to grant approval (the "Authority" ) , and subject to final approval by this Council , Company, and the purchaser of the Revenue Bonds as to the ulti- mate details of the financing of the Project; 4. I_n accordance with Subdivision 7a of Section 474. 01 Minnesota Statutes, the Mayor of the City is hereby authorized and directed to submit the proposal for the Project to the Authority requesting its approval, and other officers, employees and agents of the City are hereby authorized to provide the Authority with such preliminary information as it may require; 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 the Authority 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 Revenue Bonds as to the maturities, interest rates and other terms and provisions of the Revenue 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 pre- pared 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 Revenue Bonds shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property or fund: 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 Revenue Bonds shall never have the right to compel any exercise of the taxing power of the City to pay the outstanding principal on the Revenue Bonds or the interest thereon, or to enforce payment thereof against any property of the City. The Revenue Bonds shall recite in substance that the Revenue Bonds, including interest thereon, is payable solely from the revenue and proceeds pledged to the payment thereof . The Revenue Bonds shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation; 8. It is further found, determined and declared that it is the present .intent of the City Council to authorize the issuance and sale of the Revenue Bonds but the City reserves the right in its sole discretion to withdrawn this preliminary approval of the Project if at any time the City Council deter- mines that the public interest and the purposes of the Act will not be served by the Project; 9. This resolution is subject to the condition that no later than December 31, 1984 the City and the Company shall have agreed to mutually acceptable terms and conditions of a revenue agreement, the Revenue Bonds and of the other instruments and proceedings relating to the Revenue Bonds, and their issuance and sale and closing on the purchase of the Revenue Bonds shall have occurred. If such agreement does not take place within that time or any extension thereof and the Revenue Bonds are not sold within such time, this resolution shall expire and be of no further force or effect; and 10. This appoval is contingent upon receipt by the City from the Company of $27 , 500 which will be deposited by the City with the Authority on or before August 206, 1984 in order to preserve the issuance authority of the City with respect -to the Revenue ?fonds in accordance with the provisions of the Act. Such deposit shall be returned to the Company when and if the Authority returns such deposit to the City. Adopted by the City Council of the City of Eden Prairie, Minnesota, this day of August, 1984. Mayor Attest: City Clerk z