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City Council Resolution 1981-15~~ Extract of Minutes of fleeting of the City. Council of the City of Monticello, Minnesota Pursuant to due call and notice thereof, a regular meet- ing of the City Council of the City of Monticello, Minnesota was duly held at City Hall in said City on Monday, the 27th day of April, 1981,, at 7:30 o'clock P.M. The following Councilmembers were present: Grimsmo, Blonigen, Fair, Maus and ~7h~.te and the following were absent: None Councilmember White introduced and read the .following written resolution and moved its adoption: RESOLUTION NO. 1981-15 RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROJECT UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, AUTHORIZING SUBMISSION OF AN APPLICATION TO THE MINNESOTA COMMISSIONER OF SECURITIES FOR APPROVAL THEREOF AND AUTHORIZING EXECUTION OF A MEMORANDUM OF AGREEMENT AND ' PREPARATION OF NECESSARY DOCUMENTS IN CONNECTION WITH THE PROJECT The motion for the adoption of the foregoing resolution was duly seconded by Councilmember Fair, and upon vote being taken thereon the following voted in favor .thereof: Grimsmo, Blonigen, Fair, Maus and tiJhite and the following voted against the same: None whereupon said resolution was declared duly passed and adopted. • Adopted by the City Council of the City of Monticello, Minnesota, the 27th day of April, 1981.. ~~~ ' Mayor Attest: C:~^+.-- ty Clerk -5- ~ ~ Application to be submitted to the Commissioner for approval of the Project. The Mayor, City Manager, City Attorney and other off icer.s, employees and agents of the City are hereby authorized and directed to provide the Commissioner with any preliminary information the Commissioner may need for this purpose. 2.5 Mackall, Crounse & Moore, acting as bond counsel, is authorized to assist in the preparation and review of all documents relating to the Project; to consult with the City Attorney, the Partnership and the purchasers of the Bonds as to the maturity, interest rate and other terms and provisions of the Bonds and as to the covenants and other. provisions of the operative documents; and to submit .such documents to this Council for final approval. SECTION 3 General 3.1 The proponents of the Project have agreed to pay or cause the Partnership to pay any and all costs incurred by the City in connection with the Project whether or not the Project is approved by the Commissioner; whether or not the Project is carried to completion; and whether_ or not the Bonds or operative instruments. are executed. 3.2 The proponents of the Project, on behalf of the Partner- ship, are hereby authorized to enter into such. contracts as may be necessary for the construction of the Project by any means available to it and in the manner it determines without advertisement for bids as may be required foY the construction or acquisition of other municipal facilities. 3.3 In anticipation of the approval of the Project by the Commissioner and the issuance of the .Bonds to finance a portion of the Project,. and in order that completion of the Project will not be unduly delayed when approved, the Partnership is hereby.autho- rized to make such expenditures and advances toward payment of-that portion of the costs of the Project to be financed from the proceeds of the Bonds as the Partnership considers necessary; including the use of interim financing subject to reirnbursement from the proceeds of the Bonds if and when issued but otherwise without liability on the part of the City. -4- LJ (f) The existence of the Project would add to the tax base of the City and of the county and school district in which the Project is located and would provide increased employment,opportu- nities for residences of the City and the surrounding area.. SECTION 2 Preliminary Approval of Project 2'.1 On the basis of information provided to this. Council, it appears' that it would be in the best interest of the City to issue the Bonds in accordance with the Act, in an amount not to exceed $1,400,000, in order to partially finance the. cost of the Project. 2.2 The Project is hereby given pr_elimin.ary approval and the issuance of the Bonds by the City in the foregoing amount is also herebyappr.oved, subject to approval of the Project by the Commis- sioner of Securities, Minnesota Department of Commerce (the "Commissioner"); the fulfillment of such other conditions as the City may require with respect to the issuance of the Bonds in connection with the Project; and the mutual agreement of this Council, the Partner_siiip and the purchaser of the Bonds as to the structuring of the financing and as to the terms and conditions of any of the .documents required for the transaction. 2.3 Nothing in this resolution or in the documents prepared pursuant hereto shall authorize the expenditure of any funds of the City on the Project other than the revenues derived therefrgm 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 Project and the revenue and proceeds pledged to the payment thereof, nor shall the City be subject to any. liability thereon. No holder of any of the Bonds shall have the right to compel any exercise of the taxing power of the City to pay the outstanding principal of or interest on the Bonds; or to enforce payment thereof against any property of the City except the Project. Each Bond shall recite on its face that the principal of and interest on the Bond is payable solely from the revenue and proceeds pledged to the payment thereof. The Bonds shall, not constitute debts of the City. within the meaning of any constitutional or statutory limitation. 2.4 The forms of Memorandum of Agreement between the City and the Partnership and the Application for Approval of Municipal Industrial Revenue Bond Project by the City to the Commissioner, together with all attachments and exhibits thereto, substantially in the forms presented herewith, are hereby approved, and the Mayor and City Manager are authorized to execute said documents on behalf of the City and, in accordance with SeCt10T1 474.01, Subdivision 7a of the Act, are hereby authorized and directed to cause said -3- • __2 At a public hearing, duly called, noticed and held on April 27, 198.1, in accordance with the Act, all parties desiring appear were afforded an opportunity to be heard. Based on such public hearing and on such other facts and circumstances as this Council deems relevant, this Council hereby finds, determines and declares as follows: to (a) The purpose of the' Act as found and determined by the state legislature is to promote the welfare of the state by the active attraction, encouragement and development of economically sound industry and commerce to prevent so far as possible tlYe emergence of blighted and marginal lands and areas of chronic unemployment. Factors necessitating the active promotion and development of economically sound industry and commerce are the increasing concentration of population in the metropolitan areas, 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 e-nployment opportunities for_ such population. (b) The welfare of the residents of the state requires the active promotion, attraction, encouragement and development of economically sound industry and commerce through governmental acts; the encouragement of employment opportunities for citizens of the 'state and the City; and the development of industry to use available resources of the City, in order to~retain the benefit of its exist - ing investment in educational .and public service facilities. (c) .The Project would further the foregoing purposes of the Act as contemplated. by and described in Section 474.01 bf the Act. (d) The City is authorized by the Act to issue its commercial development revenue bonds to finance capital projects consisting of properties used or_ useful in connection with a revenue producing enterprise, such as that of the Project. (e) This Council has been .advised by FBS Mortgage Corporation, agent for the Partnership (the "Agent") that con- ventional, commercial financing to partially finance the-cost of the Project is available on such a limited basis and at such high interest rates that the economic feasibility of operating the Project would be significantly reduced.. However, with the aid of a municipal borrower, and its resulting lower borro~oing cost, the economic feasibility of the Project would be substantially increased and that the issuance of the Bond by the City would be a significant inducement to the Partnership to construct the Project in the City. -2- ~ ~ RESOLUTION NO. 1981-15' RESOLUTION GIVING'PRELIMINARY APPROVAL TO A PROJECT UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT, AUTHORIZING SUBMISSION OF AN APPLICATION TO THE MINNESOTA COMMISSIONER OF SECURLTIES FOR. APPROVAL THEREOF AND AUTHORIZING EXECUTION OF A MEMORANDUM OF AGREED4ENT AND PREPARATION OF NECESSARY DOCUMENTS IN CONNECTION WITH THE PROJECT BE IT RESOLVED by the City Council (this "Council") of the City of Monticello, Minnesota (the "City"), as follows: SECTION 1 Recitals and Findings 1.1 This Council called a public hearing on a proposal pre- sented to it that .the City. undertake a project pursuant to the Municipal Industrial Development Act, Minnesota Statutes, Chapter 474, as amended (the "Act") consisting of the acquisition of land in the City and the construction of a medical clinic building thereon and the purchase. of equipment therefor (the "Project"). Under the proposal, a partnership formed under the lavas of the State of Minnesota and consisting of Messrs. Thomas E. McKee, Theodore J. BuselRieie_r, M.D., Helmer E. Swenson, M..D., P9ahmood Mahdavi, M.D., Byron A. Teska, Ai.D., James A. Cameron, M.D, and Clark Shattuck, M.D. (the "Partnership") will enter into a loan agreement (the "Loan Agreement") with the City whereby the City agrees to issue and sell its $1,400:,000 Commercial Development, Revenue Bonds (the "Bonds") to partially finance the Project and to loan th,e proceeds of such sale to the Partnership which agrees to construct the Project. The Loan Agreement will require the Part- nership to pay amounts sufficient to pay the principal of and interest on the Bonds. The Bonds will be issued and sold. to an institutional investor or investors, as tax exempt mortgage and equipment financings, and will be secured by a mortgage and other encumbrances on the Project. .The Partnership will retain title to and ownership of the Project and will lease the Project to a group of doctors under lease terms sufficient to provide for the payment of principal of and interest on the Bonds. .The interest of the Partnership in the lease and the interest of the City in the Loan Agreement will be assigned to the holders of the Bonds as additional security for the Bonds. The Bonds will be issued and sold in accordance with the Act and will provide that the Bonds are payable solely from amounts received by the -City pursuant to the Loan Agreement and other property pledged to their payment. The Bonds will not be general obligations of the City or be payable from any. other .property or funds of the City. • ~ STATE OF MINNESOTA ) ss. COUNTY OF VJRIGHT ) I, the undersigned, being the duly qualified .and acting 't Clerk of .the City of Monticello, Minnesota, do hereby certify Ci y ular that I have compared the attached extract of minutes of a reg etin of the City Council of the City held on Monday, the 27th. me g day of April, 1981, with the original thereof on file in my off ice,. and that the attached extract is a full, true and correct transcript of the original insofar as such minutes relate to a resolution giving preliminary approval to the $1,400,000`Commercial Development Revenue Bonds (Medical. Facilities Company Project) of the City . ti~ITNESS My hand and seal as said City Clerk this S day of 1981. ~ C.tJ City Clerk (Seal)