HomeMy WebLinkAboutEDA RES 2003-05RESOLUTION 2003-05
RESOLUTION RATIFYING AND SPECIFYING TERMS OF THE
INTER-FUND LOANS FOR THE SHEFFIELD TIE DISTRICT
RECITALS
A. The City of Columbia Heights. ("City") and its Economic Development Authority
("Authority") have undertaken a program to promote the development and redevelopment of land
which is underutilized within the City, and in this connection the Authority administers the
Redevelopment Project No. 1 pursuant to Minnesota Statutes, Sections 469.001 to 469.047 and
Sections 469.090 to 469.1081 (the "Act").
B. Pursuant to the Act, the Authority is authorized to undertake certain activities to prepare
such mai property for development and redevelopment by private enterprise.
C. Within the Project the Authority and City have established the Sheffield Tax Increment
Financing District 0VIS) (the "TIF District").
D. In order to provide funds for land acquisition, site preparation and other costs authorized
in the TIF Plan for the TIF District, the Authority made an interfnnd loan from the Sewer Utility and
Liquor Funds in the amount of $640,174 (the "TIF Loan"), disbursed during 1995, 1996 and 1997.
E. The Authority has determined a need to ratify the establishment of the TIF Loan as
permitted under Minnesota Laws, 2001 First Special Session, Ch.5, Article 15, section 3 (the "Act")
and to document the repayment schedule, interest rate, and payment terms for the remaining balance
of that loan.
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Columbia
Heights Economic Development Authority as follows:
1. The TIF Loan in the principal amount of $640,174 bears interest at the rate of 5.0
percent per annum, subject to adjustment as provided below. Interest accrues from the date of this
resolution until the principal and interest are paid in full. The interest rate payable in any year will
not exceed the greater of(a) the rate specified under Minnesota Statutes, Section 270.75, or (b) the
rate specified under Minnesota Statutes, Section 549.09. The interest rate for each calendar year
during the term of the TI1~ Loan will be determined as of each January 1, using either the stated rate
of 5.0 percent, or, if that rate exceeds the statutory maximum, the maximum rate under clauses (a)
or (b) in effect as of that date.
2. Principal and interest ("Payments") shall be paid semi-annually on August 1, 2003
and each August 1 and February 1 thereafter to and including the earlier of (a) the date the principal
and accrued interest of the TIF Loan is paid in full, or (b) the date of last receipt of tax increment
from the TIF District ("Payment Dates") which Payments will be made in the amount and only to
the extent of Available Tax Increment as hereinatier defined. Payments shall be applied first to
accrued interest, and then to unpaid principal.
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3. Payments on this TIF Loan are payable solely from "Available Tax Increment,"
which shall mean, on each Payment Date, all of the tax increment generated in the preceding six (6)
months with respect to the property within the TH District and remitted to the Authority by Anoka
County, all in accordance with Minnesota Statutes, Sections 469.174 to 469.179. Payments on this
TIF Loan are subordinate 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 TIF 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 other~vise required to be
made under this TI~ Loan.
5. This TIF Loan is evidence of an internal borrowing by the Authority in accordance with
the Act and is a limited obligation payable solely fi.om Available Tax Increment pledged to the
payment hereof under this resolution. This TIF 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 TIF 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 TIF Loan or other costs incident hereto. The
Authority shall have no obligation to pay any principal amount of the TIF Loan or accrued interest
thereon, which may remain unpaid after the final Payment Date.
6. The Authority may amend the terms of this TII~ Loan at any time by resolution of the
Authority's Board of Commissioners, including a determination to forgive the outstanding principal
amount and accrued interest to the extent permissible under law.
7. The Board ratifies all actions of its staff and consultants in making the TIF Loan, and
authorizes and directs staff to take all actions necessary to repay the outstanding balance of the TIF
Loan in accordance with this resolution.
Approved byth~9 Board of Commissioners of the Columbia Heights Economic Development
Authority this //(~ day of March, 2003.
Walter R. Fehst, ~xecutive Director
ATTEST BY:
Che~Bakken, Commfinity ~evelopmem~ecretary
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