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HomeMy WebLinkAbout1980-055 CCRMember Bill Fignar introduced the following resolution and moved its adoption: RESOLUTION NO. 80-55 RESOLUTION RECITING A PROPOSAL FOR A COMMERCIAL FACILITIES DEVELOPMENT PROJECT GIVING PRELIMINARY APPROVAL TO THE PROJECT PURSUANT TO THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT AUTHORIZING THE SUBMISSION OF AN APPLICA- TION FOR APPROVAL OF SAID PROJECT TO THE COMMISSIONER OF SECURITIES OF THE STATE OF MINNESOTA AND AUTHORIZING THE PREPARATION OF NECESSARY DOCUMENTS AND MATERIALS IN CONNECTION WITH SAID PROJECT WHEREAS, (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 develop- ment of economically sound industry and commerce are the increasing concentration of population in the metro- politan 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 Brooklyn Center (the "City has received from S S Real Estate Company, a general partnership consisting of Dale M. Swenson and Duane M. Swenson, organized under the laws of the State of Minnesota (the "Company a proposal that the City undertake to finance a Project hereinafter described, through the issuance of revenue bonds in the form of a single debt instrument (the "Note pursuant to the Act; (d) The City desires to facilitate the selective development of the community, retain and improve its tax base and help it provide the range of services and employment opportunities required by its 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 City; RESOLUTION NO. 80 -55 (e) Company is currently engaged in the business of owning and operating furniture and interiors retail facilities. The Project is to be financed by the Note is an Ethan Allen Gallery to be located in the City and leased to Swenson's Carriage House, Inc., a Minnesota corporation, and consists of the acquisition of land and the construc- tion of buildings and improvements thereon and the installation of equipment therein, and will result in the employment of additional persons to work within the new facilities; (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, but Company has also advised this Council that with the aid of municipal financing, and its resulting low borrow- ing cost, the Project is economically more feasible; (g) Pursuant to a resolution of the City Council adopted on November 19, 1979, a public hearing on the Project was held on February 11, 1980, after notice was published, and materials made available for public inspection at Brooklyn Center City Hall, 6301 Shingle Creek Parkway, all as required by Minnesota Statutes, Section 474.01, Subdivision 7b at which public hearing all those appearing at said hearing 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 Brooklyn Center, 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 474, Minnesota Statutes), consisting of the acquisition, construction and equipping of facilities within the City pursuant to Company's specifications suitable for the operations described above and 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 Note in the total principal amount of approximately $1,000,000 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 Note; and the City hereby undertakes preliminarily to issue its Note in accordance with such terms and conditions; RESOLUTION NO. 80 -55 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 enter- prises 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 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 its tax base and provide the range of service and employment opportunities required by its 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 to eventually increase the City's tax base; 3. The Project is hereby given preliminary approval by the City subject to the approval of the Project by the Com- missioner of Securities, and subject to final approval by this Council, Company, and the purchaser of the Note as to the ultimate details of the financing of the Project; 4. In 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 Commissioner of Securities, requesting his approval, and other officers, employees and agents of the City are hereby authorized to provide the Commissioner with such preliminary information as he 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 com- pletion and whether or not approved by the Commissioner will be paid by Company; 6. Briggs and Morgan, Professional Association, acting as bond counsel, and First Corporate Services, Inc., investment bankers, are 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 Note as to the maturities, interest rates and other terms and provisions of the Note and as to the covenants and other provisions of the necessary documents and to submit such documents to the Council for final approval; RESOLUTION NO. 80 -55 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 Note 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 Note shall never have the right to compel any exercise of the taxing power of the City to pay the outstanding principal on the Note or the interest thereon, or to enforce payment thereof against any property of the City. The Note shall recite in substance that the Note, including interest thereon, is payable solely from the revenue and proceeds pledged to the payment thereof. The Note shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation; 8. In anticipation of the approval by the Commissioner of Securities and the issuance of the Note to finance all or a portion of the Project, and in order that completion of the Project will not be unduly delayed when approved, Company is hereby authorized to make such expenditures and advances toward payment of that portion of the costs of the Project to be financed from the proceeds of the Note as Company considers necessary, including the use of interim, short -term financing, subject to reimbursement from the proceeds of the Note if and when delivered but otherwise without liability on the part of the City. February 11, 1980 Date G­ ATTEST Deputy Clerk The motion for the adoption of the foregoing resolution was duly seconded by member Tony Kueflex, 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.