City Council Resolution 1997-10RESOLUTION 97-10
RESOLUTION RECITING A PROPOSAL FOR AN
INDUSTRIAL DEVELOPMENT PROJECT
GIVING PRELIMINARY APPROVAL TO THE PROJECT
PURSUANT TO THE MINNESOTA
MUNICIPAL INDUSTRIAL DEVELOPMENT ACT
SUBJECT TO HOLDING A PUBLIC HEARING
AND AUTHORIZING THE SUBMISSION OF AN APPLICATION
FOR ALLOCATION AND PREPARATION OF NECESSARY
DOCUMENTS (STANDARD IRON & WIRE WORKS, INC. PROJECT)
WHEREAS,
(a) The purpose of Minnesota Statutes, Sections
469.152 to 469.165 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 economically 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
development of economically sound industry and commerce are the
increasing concentration of population in the metropolitan 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 Monticello (the
"City") has received from Standard Iron & Wire Works, Inc., a
Minnesota corporation (the "Company") a proposal that the City
undertake to finance a Project hereinafter described, through the
issuance of revenue bonds (hereinafter the "Bonds" or the "Revenue
Bonds") pursuant to the Act;
(d) The City desires to facilitate the selective
development of the community and surrounding area, retain and
improve the tax base in the City, and help to provide the range of
services and employment opportunities required by the population;
and the Project will assist the City in achieving those objectives .
The Project will help to increase assessed valuation in the City
and help maintain a positive relationship between assessed
valuation and debt and enhance the image and reputation of the
community;
(e) The Project to be financed by the Bonds is the
acquisition and installation of metal parts fabrication equipment
(estimated at $1,240,000) in the Company's existing manufacturing
facility located at 207 Dundas Road in the City and construction of
additional improvements to the facility (estimated at $60,000).
The project is expected to create at least 16 and as many as 32 new
780937.1
ution 97-10
s at an annual payroll increase of approximately $400,000 (16
s) to $800,000 (32 jobs);
(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;
(g) 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 Monticello, Minnesota, as follows:
1. The Council hereby gives preliminary approval to the
proposal of Company that the City undertake the Project pursuant to
the Act, subject to holding a public hearing with respect to the
Project, and pursuant 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 Bonds in the total principal amount of approximately
$1,300,000 to be issued pursuant to the Act to finance the
acquisition, construction, and installation of the Project; and
such revenue agreement may also provide for the interest of Company
therein to be pledged to the purchaser of the Bonds; and the City
hereby undertakes preliminarily to issue its Bonds in accordance
with such terms and conditions.
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 enterprises engaged in manufacturing
within the meaning of Subdivision 2(a)(1) of Section 469.153 of the
Act; that the Project furthers the purposes stated in Section
469.152; 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 surrounding
area retain and improve the tax base and to provide the range of
service and employment opportunities required by the 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 surrounding communities and
eventually to increase the tax base of the community.
780931.1 2
ution 97-10
13. The Project is hereby given preliminary approval by the
y subject to holding a public hearing with respect to the
~~.;ject and consideration of information, if any, presented and
further subject to final approval by this Council, Company, and the
purchaser of the Bonds as to the ultimate details of the financing
of the Project.
4. The Mayor and staff of the City are hereby authorized and
directed to submit a request for allocation of federal bonding
authority for the Project.
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, including legal fees, whether or not the Project is
carried to completion and whether or not volume cap is obtained
will be paid by Company.
6. Kennedy & Graven, as counsel to the City, and Briggs and
Morgan, Professional Association are authorized to assist in the
preparation and review of necessary documents relating to the
Project, to consult with the City, Company and the purchaser of the
Bonds as to the maturities, interest rates and other terms and
provisions of the Bonds and as to the covenants and other
provisions of the necessary documents and to submit such documents
to the Council for final approval.
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
Bonds 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 Bonds
shall never have the right to compel any exercise of the taxing
power of the City to pay the outstanding principal on the Bonds or
the interest thereon, or to enforce payment thereof against any
property of the City. The Bonds shall recite in substance that the
Bonds including interest thereon, are payable solely from the
revenue and proceeds pledged to the payment thereof. The Bonds
shall not constitute a debt of the City within the meaning of any
constitutional or statutory limitation.
8. In anticipation of the issuance of the Bonds 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 as Company con-
siders necessary, including the use of interim, short-term
financing, subject to reimbursement from the proceeds of the Bonds
if and when delivered but otherwise without liability on the part
of the City.
780931.1 3
ion 97-10
9. City staff is hereby authorized and directed to work with
counsel to prepare and publish a Notice of Public Hearing with
~~aNect to the Project.
Adopted by the City Council of the City of Monticello, Minnesota,
this 10th day of March, 1997.
/~
Mayor
Att
City dministrator
780931.1
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TE OF MINNESOTA
NTY OF DOUGLAS
Y OF MONTICELLO
I, the undersigned, being the duly qualified and acting
inistrator of the City of Monticello, Minnesota, DO HEREBY
CERTIFY that I have compared the attached and foregoing extract of
minutes with the original thereof on file in my office, and that
the same is a full, true and complete transcript of the minutes of
a meeting of the City Council of said City duly called and held on
the date therein indicated, insofar as such minutes relate to a
resolution giving preliminary approval to an industrial development
project .
WITNESS my hand this 1 y day of ~1/1d~~H' 1997 .
780931.1
C ~~ ~
Adm istrator
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