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HomeMy WebLinkAbout6.l. Approval of Interfund Loan TransferAGENDA ITEM: Approval of fnterfund Loan Transfer AGENDA SECTION: Consent PREPARED BY: Kim Lindquist, Community Development Director AGE FjM t! E,•: ATTACHMENTS: Draft Resolution APPROVED BY:DO RECOMMENDED ACTION: Motion to approve draft Resolution 4 ROSEMOUNT CITY COUNCIL City Council Regular Meeting. February 7, 2006 EXECUTIVE SUMMARY ISSUE As part of the Downtown redevelopment process the City has purchased several properties on a willing seller basis. In October 2004, the City Council authorized an fnterfund loan for $2,000,000 to land acquisition. Due to the impending purchase of the Genz Ryan property additional funds need to be transferred to cover the sale. The City has purchased two additional residential properties with the previous fnterfund loan; leaving the transfer short of what is needed for the Genz Ryan property. SUMMARY Staff is recommending authorization to transfer $300,000. This will cover the Genz Ryan purchase and will allow a small amount to purchase another residence, should one become available. In the recent past, staff has been approached by two different residential land owners expressing interest in the City purchasing their property. Ultimately, both have not come to fruition but staff would prefer have the option should something become available Of course the Port Authority would have to approve any purchase agreement for another purchase so there is future opportunity to discuss purchases prior to expending the funds CITY OF ROSEMOUNT DAKOTA COUNTY, MINNESOTA RESOLUTION NO. 2006- RESOLUTION APPROVING THE TERMS OF $300,000 INTERNAL LOAN IN CONNECTION WITH THE DOWNTOWN BROCKWAY TAX INCREMENT FINANCING DISTRICT WHEREAS, the City has heretofore approved the estabhshment of the Downtown Brockway Tax Increment Financmg District (the "TIF District within the Rosemount Redevelopment Project (the "Project and has adopted a Tax Increment Financing Plan (the "TIF Man for the purpose of financing certain unprovements withm the project. WHEREAS, the City has determined to pay for certain costs identified in the TIF Plan consisting of land /building acquisition, site improvements /preparation, environmental remediation, pubhc utilities, parking facilities, streets and sidewalks, interest, administrative costs (collectively, the Quahfied Costs which costs will be financed on a temporary basis from City funds available for such purposes, and WHEREAS, under Minnesota Statutes, Section 469.178, Subd. 7, the City is authorized to advance or loan money from the City's general fund or any other fund from which such advances may be legally made, m order to finance the Quahfied Costs; and WHEREAS, the City mtends to reimburse itself for the Qualified Costs from tax increments derived from the TIF District in accordance with the terms of this resolution (which terms are referred to collectively as the "TIF Loan and NOW, THEREFORE, BE IT RESOLVED, the Council of the City of Rosemount hereby approves the TIF Loan with the following terms. The city shall repay to the City fund from which the Qualified Costs are tmually paid, the prmcipal amount of $300,000 together with interest at the rate of 4 and a 4% interest rate for each calendar year during the term of the TIF Loan; and BE IT FURTHER RESOLVED, that the term of the loan shall be two years and the interest shall accrue to principal on a semi -annual basis on each June la and December 1st; and BE IT FURTHER RESOLVED, that the 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 TIF District [or name other districts] and remitted to the City by Dakota County, all in accordance with Minnesota Statutes, Sections 469 174 to 469.1799, all inclusive, as amended. 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 panty with any other outstanding or future interfund loans secured in whole or in part with Available Tax Increment, and BE IT FURTHER RESOLVED, that the principal sum and all accrued interest payable under this TIF Loan are pre payable in whole or m part at any time by the City without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under this TIF Loan; and BE IT FURTHER RESOLVED, that this TIF Loan is evidence of an internal borrowing by the City m accordance with Minnesota Statutes, Section 469.178, Subd. 7, and is a limited obhgatton payable solely from 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 City 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 mterest on this TIF Loan or other costs incident hereto. The City shall have no obligation to pay any prmcipal amount of the TIF Loan or accrued interest thereon, which may remain unpaid after the final Payment Date; and BE IT FURTHER RESOLVED, that the City may amend the terms of this TIF Loan at any time by resolution of the City Council, including a determination to forgive the outstanding principal amount and accrued interest to the extent permissible under law. ADOPTED this 7th day of February, 2006 by the City Council of the City of Rosemount. ATTEST: Linda Jentmk, City Clerk William H Droste, Mayor RESOLUTION 2006 Motion by: Second by: Voted in favor: Voted against: Member absent: 2