051313 EDACITY OF NEW HOPE
EDA MEETING
VK� City Hall, 4401 Xylon Avenue North
May 13, 2013
EDA Meeting will commence upon
adjournment of the City Council Meeting
President Kathi Hemken
Commissioner John Elder
Commissioner Andy Hoffe
Commissioner Eric Lammle
Commissioner Daniel Stauner
1. Call to order
2. Roll call
3. Approval of April 22, 2013, EDA Minutes
4. Resolution authorizing an interfund loan for advance of certain costs in connection
with a tax increment financing district that may be created by the city of New
Hope and the New Hope Economic Development Authority (project no. 911)
5. Adjournment
CITY OF NEW HOPE
4401 XYLON AVENUE NORTH
NEW HOPE, MINNESOTA 55428
EDA Minutes April 22, 2013
Regular Meeting City Hall
CALL TO ORDER President Hemken called the meeting of the Economic Development
Authority to order at 7:46 p.m.
ROLL CALL Present: Kathi Hemken, President
Andy Hoffe, Commissioner
Eric Lammle, Commissioner
Daniel Stauner, Commissioner
Absent: John Elder, Commissioner
Staff Present: Kirk McDonald, City Manager
Curtis Jacobsen, Director of Community Development
Guy Johnson, Director of Public Works
Rich Johnson, Human Resources Manager
Valerie Leone, City Clerk
Chris Long, City Engineer
Susan Rader, Director of Parks & Recreation
Steve Sondrall, City Attorney
APPROVE MINUTES Motion was made by Commissioner Stauner, seconded by Commissioner
Lammle, to approve the Regular Meeting Minutes of February 11, 2013.
Voting in favor: Hemken, Hoffe, Lammle, Stauner; Voting against: None;
Absent: Elder; Abstained: None. Motion carried
IMP. PROJECT 911 President Hemken introduced for discussion EDA Item 4, Resolution
Item 4 authorizing application for the tax base revitalization account (TBRA) grant
by the New Hope Economic Development Authority (project no. 911).
The EDA expressed support in pursuing a grant opportunity to fund the
removal of asbestos and hazardous materials at 7940 55th Avenue North
(Winnetka Learning Center property).
RESOLUTION 2013 -06 Commissioner Stauner introduced the following resolution and moved its
Item 4 adoption "RESOLUTION AUTHORIZING APPLICATION FOR THE TAX
BASE REVITALIZATION ACCOUNT (TBRA) GRANT BY THE NEW
HOPE ECONOMIC DEVELOPMENT AUTHORITY (PROJECT NO. 911),"
The motion for the adoption of the foregoing resolution was seconded by
Commissioner Lammle, and upon vote being taken thereon, the following
voted in favor thereof: Hemken, Hoffe, Lammle, Stauner; and the following
voted against the same: None; Abstained: None; Absent: Elder, whereupon
the resolution was declared duly passed and adopted, signed by the president
which was attested to by the executive director.
EDA Meeting
Page 1 April 22, 2013
ADJOURNMENT Motion was made by Commissioner Lammle, seconded by Commissioner
Stauner, to adjourn the meeting. Voting in favor: Hemken, Hoffe, Lammle,
Stauner; Voting against: None; Absent: Elder; Abstained: None. Motion
carried The New Hope EDA adjourned at 7:47 p.m.
Respectfully submitted,
Valerie Leone, City Clerk
EDA Meeting
Page 2 April 22, 2013
EDA
Originating Department
0 ' L i
Approved for Agenda ( Agenda Section
Community Development May 13, 2013 EDA
Item No.
Curtis Jacobsen, Director of CD
Kirk McDonald, City Manager 1 4
Approve resolution authorizing an interfund loan for advance of certain costs in connection with a tax
increment financing district that may be created by the city of New Hope and the New Hope Economic
Development Authoritv. (Proiect No. 911)
Requested Action
Staff requests that the EDA approve resolutions authorizing an internal ( interfund) loans to a future TIF
District for the properties located at 7940 55th Avenue North.
Policy /Past Practice
It is the practice of the EDA to require the approval of resolutions authorizing interfund loans.
Background
Ehlers is recommending that the EDA should approve interfund loan resolutions to cover the costs of the
acquisition of the Winnetka Learning Center at 7940 55 Avenue North and its three related parcels. State
Statute requires that the EDA approve a resolution authorizing an internal ( interfund) loan to a future TIF
district and set the terms for reimbursement of the qualified TIF costs to be repaid with tax increments from
the newly created TIF district.
Recommendation
Staff recommends approval of the Resolutions.
Attachments
• Ehlers memo
• Resolution for Interfund Loan
L ell � Second by
I: \RFA \COMM DEV \Development \Q R - EDA Interfund Loa Reso 5 13- 13.doc
Memo
To: Kirk McDonald — EDA Executive Director
From: Stacie Kvilvang
Date: May 13, 2013
Subject: Interfund Loan Resolution — Acquisition, Demolition and Administrative
Costs for Winnetka Learning Center
The City and EDA will be expending funds for the acquisition, demolition and administrative
costs for legal and financial advisors for the above referenced property. Since it may be a
year or two before a TIF district is created (if at all) for the redevelopment, the City and EDA
will need to "front" these costs. If the City and EDA want to be reimbursed for these costs at
a future date from TIF funds, then an interfund loan is required before the expenditure is
made.
Attached is a resolution authorizing an interfund loan of up to $2,400,000 from the
City's /FDA's TIF District #86 -1 and the EDA's Development Fund to the future TIF District.
The City and EDA will reimburse TIF District #86 -1 and the EDA's Development Fund for
the above referenced costs (as they are advanced) in the current principal amount, together
with interest at the rate of 4% per annum, when land sale proceeds and TIF funds become
available. The interest rate is set at the statutory maximum and will not be adjusted
annually.
Completing this action provides the City and EDA with the most flexibility to reimburse itself
in the future if and when a TIF district is created. Please contact me at 651- 697 -8506 with
any questions.
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EHLERS Mf €�rst sofa phone 651- 697 -8500 3060 Centre Pointe Drive
fit'• 4 uEaoess N PUBLIC FINANCE also in Wisconsin and Illinois fax 651- 697 -8555 Roseville, MN 55113 -1122
toll fire 800 -552 -1171
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CITY OF NEW HOPE
HENNEPIN COUNTY
STATE OF
Commissioner
introduced the following resolution and moved its adoption:
I: # 4 9
COSTS RESOLUTION AUTHORIZING AN INTERFUND LOAN FOR ADVANCE OF
CERTAIN CONNECTION
DISTRICT CREATED BY THE CITY OF
THE NEW HOPE ECONOMIC 1 (Project No.
9
BE IT RESOLVED by the Board of Commissioners (the "Board ") of the New Hope Economic
Development Authority (the "Authority "), as follows:
Section 1. Background
1.01. The Authority and the City of New Hope (the "City ") intend to create in the future a tax
increment financing district (the "TIF District ") in order to provide a funding source to assist in the
redevelopment of certain real property in the City (the "Property "), which Property has been acquired by
the Authority.
1.02. The Authority has determined to pay for certain costs consisting of public improvements,
including but not limited to design and planning costs and interest, and for administrative expenses,
including but not limited to fees of attorney and financial advisors, and interest (collectively, the
"Qualified Costs "), which costs may be financed on a temporary basis from City or Authority funds
available for such purposes.
1.03. Under Minnesota Statutes, Section 469.178, Subd. 7, the Authority is authorized to advance
money from the Authority's general fund or any other fund from which such advances may be legally
authorized, in order to finance the Qualified Costs.
1.04. The Authority intends to reimburse itself for the funds advanced for 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 "Interfund Loan ").
Section 2. Terms of Interfund Loan
2.01, The Authority hereby authorizes the advance of up to a total of $2,400,000 from the EDA
Fund and from Tax increment Financing District No. 86 -1 or so much thereof as may be paid as Qualified
Costs. The Authority shall be reimbursed for such advances together with interest at the rate stated
below. Interest accrues on the principal amount from the date of each advance. The maximum rate of
interest permitted to be charged is limited to the greater of the rates specified under Minnesota Statutes,
Section 270C.40 or Section 549.09 as of the date the loan or advance is authorized, unless the written
agreement states that the maximum interest rate will fluctuate as the interest rates specified under
Minnesota Statutes, Section 270CA0 or Section 549.09 are from time to time adjusted. The interest rate
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
Authority's Executive Director, through the date of last receipt of tax increment from the TIF District.
2.03. Payments on this Interfund Loan are payable solely from "Available Tax Increment,"
which shall mean, on each Payment Date, tax increment available after other obligations have been paid,
or as determined by the Executive Director, generated in the preceding six (6) months with respect to the
property within the TIF District and remitted to the Authority by Hennepin County, all in accordance with
Minnesota Statutes, Sections 469.174 to 469.1799, all inclusive, as amended. 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 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 Interfund Loan are pre-
payable in whole or in part at any time 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 Interfund
Loan.
2.05. This Interfund Loan is evidence of an internal borrowing by the Authority in accordance
with Minnesota Statutes, Section 469.178, Subd. 7, and is a limited obligation payable solely from
Available Tax Increment pledged to the payment hereof under this resolution. This Interfund 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 and Authority. Neither the State of
Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of or interest on
this Interfund 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 interest on this Interfund Loan or other costs incident hereto.
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 amend the terms of this Interfund Loan at any time by resolution of the
Board of Commissioners, including a determination to forgive the outstanding principal amount and
accrued interest to the extent permissible under law.
Section 3. Effective Date This resolution is effective upon the date of its approval.
The motion for the adoption of the foregoing resolution was duly seconded by Commissioner
and upon a vote being taken thereon, the following voted in favor thereof:
and the following voted against the same:
Dated: May 13, 2013
ATTEST: