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HomeMy WebLinkAbout1981-032 CCRMember Tony Kuefler introduced the following resolution and moved its adoption: RESOLUTION NO. $1 -32 RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROJECT UNDER THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT; REFERRING THE PROPOSAL TO THE COMMISSIONER OF SECURITIES FOR APPROVAL; AND AUTHORIZING PREPARATION OF NECESSARY DOCUMENTS BE IT RESOLVED by the City Council of the City of Brooklyn Center, Minnesota (the Municipality), as follows: SECTION 1 Recitals and Findings 1.1. This Council has received a proposal that the Municipality finance a portion or all of the cost of a proposed project under Minnesota Statutes, Chapter 474 (the Act), consisting of the acquisition of land and constructing and equipping of a 90,000 square foot supermarket in the City (the Project) by Ryan Construction of Minnesota, Inc., a Minnesota corporation (hereinafter the Borrower), to be leased by the Borrower to Byerly's, Inc., a Minnesota corporation. 1.2. At a public hearing, duly noticed and held on January 26, 1981, in accordance with the Act, on the proposal to undertake and finance the Project, all parties who appeared at the hearing were given an opportunity to express their views with respect to the proposal to undertake and finance the Project. Based on such hearing and such other facts and circumstances as this Council deems relevant, this Council hereby finds, determines and declares as follows: (a) The welfare of the State of Minnesota 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, and the State has encouraged local government units to act to prevent such economic deterioration. (b) The Project would further the general purposes contemplated and described in Section 474.01 of the Act. (c) The existence of the Project would add to the tax base of the Municipality, the County and School District in which the Project is located and would provide increased opportunities for employment for residents of the Municipality and surrounding area. (d) This Council has been advised by representatives of the Borrower and Juran Moody, Inc., investment bankers and dealers in municipal bonds, that conventional, commercial financing to pay the cost of the Project is available only on a limited basis and at such high costs of borrowing that the feasibility of operating the Project would be significantly reduced, but that with the aid of municipal borrowing, and its resulting lower borrowing cost, the Project is economically more feasible. RESOLUTION NO. 81 -32 (e) This Council has also been advised by the Borrower and Juran Moody, Inc., that on the basis of their discussions with potential buyers of tax exempt bonds, revenue bonds of the Municipality (which may be in the form of a commercial development revenue note or notes) could be issued and sold upon favorable rates and terms to finance the Project. (f) The Muncipality is authorized by the Act to issue its revenue bonds to finance capital projects consisting of properties used and useful in connection with a revenue producing enterprise, such as that of the Borrower, and the issuance of such bonds by the Municipality would be a substantial inducement to the Borrower to acquire and construct the Project. SECTION 2 Preliminary Approval of the Project 2.1. On the basis of information given the Muncipality to date, it appears that it would be desirable for the Municipality to issue its revenue bonds under the provisions of the Act to finance the Project in the approximate amount of $10,000,000. 2.2. It is hereby determined to proceed with the Project and its financing and the Project is hereby given preliminary approval by the Municipality and the issuance of revenue bonds of the Municipality in such amount is hereby approved, subject to the approval of the Project by the Commissioner of Securities, the fulfillment of such other conditions as the Municipality may require with respect to the issuance of its bonds in connection with the Project, and the mutual agreement of this Council and the Borrower as to the details of the bond issue and provisions for their payment. In all events, it is under- stood, however, that the bonds of the Municipality shall not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the Municipality, 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 revenues received from the Project and property pledged to the payment thereof, and shall not constitute a debt of the Municipality. 2.3. The form of the Application to the Commissioner of Securities, with attachments, is hereby approved, and the Mayor and City Manager are authorized to execute said documents in behalf of the Municipality and are hereby authorized and directed to cause said Application to be submitted to the Commissioner of Securities for approval of the Project. SECTION 3 General 3.1. If the bonds are issued and sold, the Municipality will enter into a lease, sale or loan agreement or similar agreement satisfying the requirements of the Act (the Revenue Agreement) with the Borrower. The lease rentals, installment sale payments, loan payments or other amounts payable by the Borrower to the Municipality under the Revenue Agreement shall 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. .RESOLUTION NO. 81 -32 3.2. The Borrower has agreed and it is hereby determined that any and all direct and indirect costs incurred by the Municipality in connection with this Project, whether or not the Project is carried to completion, and whether or not approved by the Commissioner of Securities, and whether or not the Municipality by resolution authorizes the issuance of the bonds, will be paid by the Borrower upon request. January 26, 1981 Date M�Yr V ATTEST: "lerk The motion for the adoption of the foregoing resolution was duly seconded by member Celia Scott and upon vote being taken thereon, the following voted in favor thereof: Dean Nyquist, Tony Kuefler, Bill Fignar, Gene Lhotka, and Celia Scott; and the following voted against the same: none, whereupon said resolution was declared duly passed and adopted. �I