HomeMy WebLinkAbout21-07 - ADMIN Resolution - Economic Development Authority - 2021/04/05EDA Resolution No. 21-07
Resolution authorizing an Interfund Loan
for advance of certain costs in connection with the
Texa Tonka Tax Increment Financing District
Whereas, the City Council for the City of St. Louis Park, Minnesota (the "City"), intends
to establish Texa Tonka Tax Increment Financing District (the "TIF District") within
Redevelopment Project No. 1 (the "Project"), and will adopt a Tax Increment Financing Plan
(the "TIF Plan") for the purpose of financing certain improvements within the Project; and
Whereas, the St. Louis Park Economic Development Authority (the “Authority”) has
determined to use tax increments from the TIF District to pay for certain administrative costs
identified in the TIF Plan (the "Qualified Costs"), which costs may be financed on a temporary
basis from Authority funds available for such purposes; and
Whereas, under Minnesota Statutes, Section 469.178, Subd. 7, the Authority is
authorized to advance or loan money from the Authority's general fund or any other fund from
which such advances may be legally authorized, in order to finance the Qualified Costs; and
Whereas, the Authority intends to reimburse itself for the Qualified Costs from tax
increments derived from the TIF District in accordance with the terms of this resolution (which
terms are referred to collectively as the "Interfund Loan").
Now therefore be it resolved as follows:
1. The Authority hereby authorizes the advance of up to $50,000 from any legally
authorized Authority fund or so much thereof as may be paid as Qualified Costs. The
Authority shall reimburse itself for such advances together with interest at the rate
stated below. Interest accrues on the principal amount from the date of each advance.
The maximum rate of interest permitted to be charged is limited to the greater of the
rates specified under Minnesota Statutes, Section 270C.40 or Section 549.09 as of the
date the loan or advance is authorized, unless the written agreement states that the
maximum interest rate will fluctuate as the interest rates specified under Minnesota
Statutes, Section 270C.40 or Section 549.09 are from time to time adjusted. The
interest rate shall be 4% and will not fluctuate.
2. 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
Payment Date on which the Authority has Available Tax Increment (defined below), or
on any other dates determined by the Executive Director of the Authority, through the
date of last receipt of tax increment from the TIF District.
3. Payments on this Interfund Loan are payable solely from "Available Tax Increment,"
which shall mean, on each Payment Date, tax increment available after other obligations
have been paid, or as determined by the Executive Director of the Authority, generated
in the preceding six (6) months with respect to the property within the TIF District and
remitted to the City by Hennepin County, all in accordance with Minnesota Statutes,
Sections 469.174 to 469.1794, as amended. Payments on this Interfund Loan may be
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EDA Resolution No. 21-07 2
subordinated to any outstanding or future bonds, notes or contracts secured in whole or
in part with Available Tax Increment, and are on parity with any other outstanding or
future interfund loans secured in whole or in part with Available Tax Increment.
4. The principal sum and all accrued interest payable under this Interfund Loan are pre -
payable in whole or in part at any time by the Authority without premium or penalty.
No partial prepayment shall affect the amount or timing of any other regular payment
otherwise required to be made under this Interfund Loan.
5. This Interfund Loan is evidence of an internal borrowing by the Authority in accordance
with Minnesota Statutes, Section 469.178, Subd. 7, and is a limited obligation payable
solely from Available Tax Increment pledged to the payment hereof under this
resolution. This Interfund Loan and the interest hereon shall not be deemed to
constitute a general obligation of the State of Minnesota or any political subdivision
thereof, including, without limitation, the Authority. Neither the State of Minnesota,
nor any political subdivision thereof shall be obligated to pay the principal of or interest
on this Interfund Loan or other costs incident hereto except out of Available Tax
Increment, and neither the full faith and credit nor the taxing power of the State of
Minnesota or any political subdivision thereof is pledged to the payment of the principal
of or interest on this Interfund Loan or other costs incident hereto. 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.
6. The Authority may amend the terms of this Interfund Loan at any time by resolution of
the Board, including a determination to forgive the outstanding principal amount and
accrued interest to the extent permissible under law.
Reviewed for Administration: Adopted by the Economic Development
Authority April 5, 2021
Thomas K. Harmening, executive director Tim Brausen, president
Attest:
Melissa Kennedy, secretary
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