EDA Resolution #2022-07 Block 52 EDA Interfund LoanCITY OF MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO.2022-07
AUTHORIZING INTERFUND LOAN FOR
ADVANCE OF CERTAIN COSTS
IN CONNECTION WITH TAX INCREMENT
FINANCING DISTRICT NO. 1-45 (BLOCK 52)
BE IT RESOLVED By the Board of Commissioners of the City of Monticello Economic
Development Authority (the "Authority") as follows:
Section 1. Background.
1.01. The Authority is proposing the creation of Tax Increment Financing District No.
1-45 (Block 52) (the "TIF District"), a redevelopment district, within the Central Monticello
Redevelopment Project No. 1 (the "Redevelopment Project") pursuant to Minnesota Statutes,
Sections 469.174 to 469.1794, as amended (the "TIF Act") and Sections 469.090 to 469.1082, as
amended (the "EDA 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 TIF 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 TIF Act.
1.04. The Authority may incur certain costs related to the TIF District, including
engineering expenses, a structural engineering report, the cost of a hazardous material survey,
and other related preliminary expenditures (the "Qualified Costs"), in an aggregate amount of up
to $85,000 which may be paid 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 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.
MN 190\ 159\778 862. v l
2.01. The Authority hereby authorizes the advance of up to $85,000 in legally available
Authority or City funds to pay the Qualified Costs, together with interest at the rate of 4% 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 270.75, and Section 549.09, both in effect for calendar year
2022. The interest rate will not fluctuate.
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
Payment Date on which the Authority has Available Tax Increment (defined below), or on any
other dates determined by the City Administrator, 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 Wright
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 interfund
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 TIF 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 all or a portion of
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 maximum
specified in Section 469.178. subd. 7 of the TIF Act.
2
MN 190\159\778862.v 1
Section 3. Effective Date. This Resolution is effective as of the date of its adoption.
Adopted this 9th day of March, 2022
President
ATTEST:
1
Executi
16 Director
MN 190\ 159%778962.v 1