HomeMy WebLinkAbout19-04 - ADMIN Resolution - Economic Development Authority - 2019/04/01St. Louis Park Economic Development Authority
Resolution No. 19-04
Authorizing Interfund Loan for advance of certain costs in connection with
proposed Beltline Blvd Station Tax Increment Financing District
Be it resolved by the Board of Commissioners of the St. Louis Park Economic
Development Authority (the “Authority”) as follows:
Section 1. Background.
1.01. The Authority intends to establish a Tax Increment Financing District (the “TIF
District”) within its Redevelopment Project No. 1 (the "Redevelopment Project") in connection
with the development of the proposed Southwest Light Rail Transit Beltline Station, pursuant to
Minnesota Statutes, Sections 469.174 to 469.1794, as amended and Sections 469.090 to
469.1082, as amended (together, the “Act”). In connection with establishment of the TIF District,
the Authority will approve a Tax Increment Financing Plan for the TIF District (the “TIF Plan”).
1.02. The Authority may incur certain costs related to the TIF District, which costs may
be financed on a temporary basis from legally available Authority or City funds.
1.03. Under Section 469.178, Subdivision 7 of the Act, the Authority is authorized to
advance or loan money from any fund from which such advances may be legally made in order to
finance expenditures that are eligible to be paid with tax increments under the Act.
1.04. The Authority expects to finance $3,100,000 in costs related to land acquisition
(the “Qualified Costs”) using Authority or City funds legally authorized for such purpose, and to
reimburse such funds from tax increments from the TIF District when received.
1.05. The Authority has also determined that it may be necessary to finance up to
$25,000 in administrative costs associated with the TIF District (the “Administrative Costs”) using
Authority or City funds legally authorized for such purpose, and to reimburse such funds from tax
increments from the TIF District when received.
1.06. The Authority intends to designate such advances as an interfund loan in
accordance with the terms of this resolution and the TIF Act.
Section 2. Repayment of Interfund Loan.
2.01. The Authority hereby authorizes the advance of up to $3,100,000 in legally available
Authority or City funds to pay the Qualified Costs, plus up to $25,000 to pay the Administrative
Costs, for a total aggregate principal amount of $3,125,000, together with interest at the rate of
5% per annum (the “Interfund Loan”). Interest shall accrue on the principal amount of each
advance from the date of such advance. The interest rate is no more than the greatest of the
rate specified under Minnesota Statutes, Section 270C.40 and Section 549.09, both in effect for
calendar year 2019, and will not be adjusted.
2.02. Principal and interest ("Payments") on the Interfund Loan shall be paid semi-
annually on each August 1 and February 1 (each a “Payment Date”), commencing on the first
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EDA Resolution No. 19-04 2
Payment Date on which the Authority receives Available Tax Increment (defined below), or on
any other dates determined by the City Manager, through the date of last receipt of tax
increment from the TIF District.
2.03. Payments on the Interfund Loan will be made solely from Available Tax Increment,
defined as tax increment from the TIF District received by the Authority from Hennepin County in
the six-month period before any Payment Date. Payments shall be applied first to accrued
interest, and then to unpaid principal. Payments on this Interfund Loan may be subordinated to
any outstanding or future bonds, notes or contracts secured in whole or in part with Available
Tax Increment, and are on a parity with any other outstanding or future interf und loans secured
in whole or in part with Available Tax Increment.
2.04. The principal sum and all accrued interest payable under this resolution is pre-
payable in whole or in part at any time by the Authority without premium or
penalty.
2.05. This resolution is evidence of an internal borrowing by the Authority in accordance
with Section 469.178, subdivision 7 of the Act, and is a limited obligation payable solely from
Available Tax Increment pledged to the payment hereof under this resolution. The Interfund
Loan shall not be deemed to constitute a general obligation of the State of Minnesota or any
political subdivision thereof, including, without limitation, the Authority and the City. Neither
the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the
principal of or interest on the Interfund Loan or other costs incident hereto except out of
Available Tax Increment. The Authority shall have no obligation to pay any principal amount of
the Interfund Loan or accrued interest thereon, which may remain unpaid after the final
Payment Date.
2.06. The Authority may at any time make a determination to forgive the outstanding
principal amount and accrued interest on the Interfund Loan to the extent permissible under law.
2.07. The Authority may from time to time amend the terms of this Resolution to the
extent permitted by law, including without limitation amendment to the payment schedule and
the interest rate; provided that the interest rate may not be increased above the ma ximum
specified in Section 469.178. subd. 7 of the Act.
Section 3. Effective Date. This resolution is effective upon approval.
Reviewed for Administration: Adopted by the Economic Development
Authority April 1, 2019
Thomas K. Harmening, Executive Director Steve Hallfin, President
Attest:
Melissa Kennedy, Secretary
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