City Council Agenda Packet 11-03-1976AON DA
SPF.C7AL MEETI NG
Novemlx:r 3. 1976 - 3 P.M.
1. .Industrial Revenue Bonds - Silver Pox :Inn.
2. Canvassing C.i.Ly c.lection.
Mai I i ng to: Stmart. Iloglund
Roger Hinges
Don SmiLll
t
111311 (V
AGENDA SUPPLEMENT
Agenda Item I. Industrial Revenue Bonds - S.i.lvcr Pox Motel. Inc.
Stuart Iloglund and Ed Larson. principal stock-
holders for the Silver Pox Motel. have requested
the City of Monticello issue .lndustria:l Revenue
Bonds for the Silver Pox Motel, Inc.
On Wednesday, Acting Mayor Denton Erickson and
myself mot with Mr. Hoglund and Mr. Larson along
with their proposed bond underwriters, Juran
and Moody, Inc.
Enclosed, you will find a brochure cxplai.ning
i.ndustri.0 revenue bonds and the purpose br_hi.nd
them. The Pollution Control Bonds the City has
.issued for NSP are a type of .i.ndustvial revenue
bond. You may recall the .important: features of
an .i.ndustri.a.l revcnuc band .is khat the interest
earned by the bond holder is exempt, from fcdeval
and state income taxes and that the City is Ln
no way .l.i.nble Por their payment even i.V the
company is .in Wnult.
An .i.ntevcst.i.ng Venture of the hand proposed Por
Si l ver Pox :Inn is t.hn t one bank and possibly
two banks wiA l he the soft, purchaser of these
bands and Che banks will not; rnee 1.1 them. There -
Core for all prnaticnl purposes thi-s arrangement;
in Like a .loan from the bank to Silver Pox Inn
nod I;herefore I;here .is no puhl.i.e exposure I;o other
bond buyers. 'I'llis .i.s an attractsive Penture, as
.!.it the normal case those bonds are sold to the
public and while the nit.y .is never liable the
nssoc.iat;ion of the city's name with bonds that
aro in default .is unal;trncLIve.
I have talked with our Umd consult; 0 Spr.i.ngaced,
:Inc. and they see no parla.cul,a" problem and our
c.it;y attorney feels likewise. Cary Pringle will
be at Wednesday's meeting to answer any questions
you mny have.
:I: have, reviewed the projected i.nrome Statement Pot-
the
orthe, Silver Pox :1'111i and though .Ifeel It, .is somewhat:
optimistic I real the hands arm srrurc. This pro-
jected lncumo sl;ot.cmont Is at my o"I" and I told
Mr. Hoglund I would not make copies of it to
keep it confidential, but, it is here for your
rev iVW.
POSSIBLE ACUON: ConsidwwLion of preliminary
resolution to approve industrial revenue bonds rot-
the
orthe Si Iver Pox Motel Inc" Juran and Moody should
be mailing these resolutions directly to you.
Reasoning behind a preliminary resolution is that,
this procedure is necessary to allow the Minnesota
Department of Economic Development to review and
approve and at a later date a final resolution will
be necessary.
REFLRENCLS: Enclosed copy of brochure
Preliminary Resolution
Feasibility Report. (avai!able at City Hall)
Agenda Item 2. Canvassing City Election"
State Statutes require. Lhc council to canvass the
votes within 2 days after Lhc city election Lo
declare the resulLs. Please note the canvass is
for city election only.
POSSIBLE ACTMN: Cnnsidcratioo of motion Lo declare
the results of the election as presented.
-2-
CER FICATIO11 OF MINUTES RULATi S TO
$450,000 Commercial Development Revenue Notes
Issuer: City of Monticello, Minnesota
Governing Body: City Council
Kind, date, time and place of meeting: A meeting, held on
116dnesday, 'November 3, 1976, at o'clock P.M., at the city Hall
Members present:
Members absent:
Documents Attached:
Minutes of said meeting (pages):
RESOLUTION AUTHORIZING THE ISSUANCE OF COI-DIERCIAL
DEVELOPMENT REVENUE NOTES, REQUESTING APPROVAL BY
THR DEPARTMENT OF ECONOMIC DEVELOPMENT, AND
AUTHORIZING THE PREPARATION OF NECESSARY DOCU14ENTS
PURSUANT TO THE I4UNICIPAL INDUSTRIAL DLVELOP14ENT ACT
I, the undersigned, being the duly qualified and acting
recording officer of the public corporation issuing the bonds re-
ferred to in the title of this certificate, certify that the docu-
ments attached hereto, as described above, have been carefully
compared with the original records of said corporation in my legal
custody, from which they have been transcribed; that said documents
are a correct and complete transcript of the minutes of a meeting
Of the governing body of said corporation, and correct and complete
copier of all resolutions and Other actions taken and of all docu-
ments opprovod by the governing bogy nt ani.cl meeting, so for as
they relato to said bonds; and that naid meeting was duly field by
the governing body at the time and place and was attended through-
out by the mcml)cr:i indicated above, pursuant to cull and notice of
atich meeting given as required by low.
WITNESS my hand officially as such recording officer this
3&A clay of Nnvoinhor , 1976 .
signature
Gary 11101301', City Adninistrator
Name and'Title
Councilmember offered the following
resolution and moved its adoption, which motion was seconded by
Councilmember
RESOLUTION AUTHORIZING THE ISSUANCE OF COMMERCIAL
DEVELOPMENT REVE14UE NOTES, REQUESTING APPROVAL BY
THE DEPARTMENT OF ECONOMIC DEVELOPMENT, AND
AUTIIORIZI14G THE PREPARATION OF NECESSARY DOCUMENTS
PURSUANT TO THE MUNICIPAL INDUSTRIAL DEVELOPMENT ACT
BE IT RESOLVED by the City Council of the City of
Monticello, Minnesota, as follows:
Section 1. Policy and Purpose.
1.01. For the purpose of promotion, attraction, encourage-
ment and development of economically sound commerce, preserving and
developing a tax base adequate to finance necessary public services,
and encouraging employment opportunities for the citizens of the
City, the City is authorized by the Municipal Industrial Development
Act, Minnesota Statutes, Chapter 474, as amended, to acquire and
lease real and personal property for use by a revenue-producing
enterprise, or to loan funds directly to the enterprise to be used
for such acquisition, said funds to be raised through the issuance
of revenue bonds or notes of the City.
1.02. Hoglund and Larson, a Minnesota partnership
(referred to herein as the Partnership) desires to undertake a
Project in the City, at a total cost presently estimated at
approximately $450,000, said Project to consist of the acquisition
of real estate and construction thereon of a 44 unit motel -
restaurant complex.
1.03. The Project would increase the level of economic
activity in the City, would increase the tax base, and would pro-
vide additional employment opportunities for residents of the
City and the surrounding area.
1.04. The City is advised by representatives of the
Partnership that with the aid of municipn]. financing, and the
resulting lower borrowing cost, the Project would be significantly
more feasible. The City is further advised by tho Partnership
that approval of: municipal financing would be a significant induce-
ment to the commencement of construe tion of the Project by the
Partnership.
1.05. The First Northwestern National Bank of Winona,
Minnosota, has advised that on the basis of information submitted
to them and their discussions with representatives of the Corporation
and other potentin]. bu,yar.s of. the notos, revenue notes of the City
could in thoir opinion be issued and sold upon favor.nbla rates and
terms in the amount required ::o pay the coot of the Project. .
Section 2. Authorization.
2.01. Subject to approval of the Project by the
Commissioner of Economic Development of the State of Minnesota,
and subject to the mutual agreement of the City, the Partnership
and the purchaser of the notes as to the details of an indenture,
lease or loan agreement, and other documents necessary to evidence
and effect the financing of the Project and the issuance of the
notes, the issuance of revenue notes of the City in the amount of
$450,000 is authorized to finance the costs of the Project.
2.02. The Mayor is authorized and directed to submit
the Project for approval by the Commissioner of Economic Develop-
ment as tending to further the purposes and policies of the
Municipal Industrial Development Act, and to cause such information
concerning the Project to be submitted to the Commissioner as he
shall require for this purpose.
2.03. Nothing in this resolution or in the documents
prepared pursuant hereto shall authorize the expenditure of any
funds on the Project other than the revenues thereof or the proceeds
of the notes or other funds granted to the City for this purpose.
The notes shall not constitute a charge, lien or encumbrance, legal
or equitable, upon any property or funds of the City nor shall the
City be subject to any liability thereon. No noteholder shall ever
have the right to compel any exercise of the taxing power of the
City to pay any such notes or the interest thereon, nor to enforce
payment thereof against any property of the City. Each note shall
recite in substance that the note, including interest thereon, is
payable solely from the revenue pledged to the payment thereof.
No note issued hereunder shall constitute a debt of the City within
the meaning of any constitutional or statutory limitation.
2.04. In anticipation of the approval by the Commissioner
of Economic Development and the issuance of revenue notes to finance
the Project, and in order that completion of the Project will not
be unduly delayed when approved, the Partnership is hereby authorized
to make such expend.itures and advances toward payment of costs of the
Projcct ns it considers necessary, including the use of interim,
short-term financing, subject to reimbursement from the proceeds of
the revenue notes when delivered but otherwise without liability on
the part of the City.
Adopted by the Council this 3rd day of. November., 1976.
Approved: +.� `L.19ACr4r.
t►-�w� mayor
Attest:
zty YAn—
//-1,74
d1
Upon call of the roll, the following Counc ilmembers
voted in favor:
and the following were opposed:
whereupon said motion was declared carried and the resolution
duly adopted.
i
SUMMAY Ta
STATEMENT OF Vd,'*!FS.
For_.._.,_ General Eketron
Late of ohnntoota'l.
dt as Vertion held In the
..City of
Stale of.Vinneve4m. on the 2nd day of
..____jovqmbe'r .4.
76
A 19 the, fdtoWns votes zvere ma and coujited for the candi-
dates enumerated beknv:
pop Me offlec,of
.Iayo�r
_ Canesld O. Johnson
Received ..... . ...
,Received...........I-Ole,
Received-----.-.-. ......... Votes
rotes
joe, W Office of,_Councilman
__R.ichard.
rot"
Received
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Reirived Mies
For the Offive of ......
Thee
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per the office pf,
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Votes
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Vol -
For the Office of.
Roman Bilatk0l
(-S=hy rple
P I #j
Vote#
6t-01,
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For the ONO of
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11,1f4i ro e ire
8_ 344
QUESTION:
,SUNDAY LIQUOR
,rtsha:'11 licenses be granted
for the"saleof intoxicating
liquor on Sundays in the City
,of Monticello?"
Xf rrech-ed
I
0
IeO9
Tii-W nun .1-o P-s,on, dually prvivot and votinu was
SNO
,tal on -di,, J bailott vwri"d by mail
C zt
Total iwii-hrr of names cniettel upon the election irgistets %vas..40U . . .. ..... 7
T.tal nu,AO,.Olw•+ i -4-1 twit, I VL_-_ AY 11431, 1
li—lerk wa%12
'Im4l ,.anther of miii,ttl ASiLts rvturptJ ,, the-cirtk was
PC"
5"HO.,
'I, A nu, r 14 p p -,I,, I lljalha. t Our tied by voters wit.).7 07-L4,
og_
Tota: nuit.lit, of uh, Ily, .16nive baHot-ast and net counted was,. -
pit)
37, Aimby ro-Iiitilliat the famdainjirturno aea carpect
Fur 1140, Uffica of
Teen
QUESTION:
,SUNDAY LIQUOR
,rtsha:'11 licenses be granted
for the"saleof intoxicating
liquor on Sundays in the City
,of Monticello?"
Xf rrech-ed
I
0
IeO9
Tii-W nun .1-o P-s,on, dually prvivot and votinu was
SNO
,tal on -di,, J bailott vwri"d by mail
C zt
Total iwii-hrr of names cniettel upon the election irgistets %vas..40U . . .. ..... 7
T.tal nu,AO,.Olw•+ i -4-1 twit, I VL_-_ AY 11431, 1
li—lerk wa%12
'Im4l ,.anther of miii,ttl ASiLts rvturptJ ,, the-cirtk was
PC"
5"HO.,
'I, A nu, r 14 p p -,I,, I lljalha. t Our tied by voters wit.).7 07-L4,
og_
Tota: nuit.lit, of uh, Ily, .16nive baHot-ast and net counted was,. -
pit)
37, Aimby ro-Iiitilliat the famdainjirturno aea carpect
Teen
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