Resolution 1441 - Laserfiche WebLink

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. ' . <, , 1.4. The City has been advised by representatives of the company that coventional, commercial financing to pay the capital cost of the Project is available only on a limited basis and at such high costs of borrowing that the economic feasibility of operating the Project would be significantly reduced, but the Company has also advised this Council that with the aid of municipal financing, and its resulting low borrowing cost, the Project is economically more feasible. 1.5. This Council is advised that the bonds will be pur- chased by a major financial institution(s), that on the basis of information submitted to them and their discussions with representa- tives of the Company and potential buyers of tax-exempt bonds, in- dustrial development revenue bonds of the City could be issued and purchased upon favorable ~ates and terms to finance the cost of the Project. 1.6. The City is authorized by Minnesota Statutes, Chapter 474, to issue its revenue bonds to finance capital projects consisting of properties used and useful in connection with a revenue producing enterprise, such as that of the Company, and the issuance of such bonds by the City would be a substantial induce- ment to the Company to expand its facility within the City. 2. On the basis of information given the City to date, it appears that it would be in the best interest of the City to issue its industrial development revenue bonds under the provi- sions of Chapter 474 to finance the Project. The Company presently estimates a total bond issue up to but not exceeding $5,000,000 to pay the cost of the Project. 3. The Project above referred to is hereby given pre- liminary approval by the City and the issuance of bonds for such purpose and in such amount approved, subject to approval of the Project by the Commissioner of Economic Development and to the mutual agreement of this body, the Company and the initial pur- chasers of the bonds as to the details of the bond issue and pro- visions, for their payment. In all events, it is understood, how- ever, that the bonds of the City shall not constitute a charge, lien or encumbrance legal or equitable upon any property of the City except the Project, and each bond, when, as, and if issued, shall recite in substance that the bond including interest there- on is payable solely from the rentals received from the Project and property pledged to the payment thereof, and shall not consti- tute a debt of the City. -2-