Res 2017- 49 Author Interfund Loan for Advance of Cost TIF Dist 2CITY OF MENDOTA HEIGHTS
DAKOTA COUNTY, MINNESOTA
RESOLUTION 2017 - 49
RESOLUTION AUTHORIZING AN INTERFUND LOAN FOR
ADVANCE OF CERTAIN COSTS IN CONNECTION WITH
TAX INCREMENT FINANCING DISTRICT NO. 2
BE IT RESOLVED by the City Council (the "Council") of the City of Mendota Heights,
Minnesota (the "City"), as follows:
Section l. Back rg ound.
1.01. The City has heretofore approved the establishment of Tax Increment Financing
District No. 2(the "TIF District") within Municipal Development District No. 1(the "Project"),
and has adopted a Tax Increment Financing Plan (the "TIF Plan") for the purpose of financing
certain improvements within the Project.
1.02. The City has determined to pay for certain costs identified in the TIF Plan
consisting of land/building acquisition, site improvements/preparation, public utilities, streets
and sidewalks, other qualifying improvements, interest and administrative costs (collectively, the
"Qualified Costs"), which costs may be financed on a temporary basis from City funds available
for such purposes.
1.03. 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 authorized, in order to finance the Qualified Costs.
1.04. The City intends 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 "Interfund Loan").
Section 2. Terms of Interfund Loan.
2.01. The City hereby authorizes the advance of up to $25,000 from any City fund or so
much thereof as may be paid as Qualified Costs, whichever is greater (the "Principal Amount").
The City shall reimburse itself for such advances from tax increment revenues received, 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 this Resolution states that the maximum interest rate
will fluctuate as the interest rates specified under Minnesota Statutes, Section 270C.40 or Section
549.09 are from time to time adjusted. The interest rate shall be 4.00% and will not fluctuate.
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) (2019), or
on any other dates determined by the City Administrator, through the date of last receipt of tax
increment from the TIF District (2044), which has a maximum term of 26 years.
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 City Administrator, generated in the
preceding six (6) months with respect to the property within the TIF District and remitted to the
City by Dakota County, all in accordance with Minnesota Statutes, Sections 469.174 to
469.1794, 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 by the City without premium or penalty. No partial
prepayment sha11 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 City 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. 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 City 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 City may amend the terms of this Interfund 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.
Section 3. Effective Date. This Resolution is effective upon the date of its approval.
Resolzrtion 2017-49 page 2
Adopted by the City Council of the City of Mendota Heights this 20th day of June, 2017.
ATTEST
Lorri Smith, City Clerk
CITY COUNCIL
CITY OF MENDOTA HEIGHTS
Neil Garlock, ayor
Resolution 2017-49 page 3