78-60
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CITY OF CHANHASSEN
CARVER & HENNEPIN COUNTIES, MINNESOTA
RESOLUTION
Date
October 2, 1978
Resolution No.
78-60
Motion by Councilman Neveaux
Seconded by Councilman Pearson
RESOLUTION GIVING PRELIMINARY APPROVAL TO A
PROJECT UNDER THE MUNICIPAL INDUSTRIAL DEVELOP-
MENT ACT, REFERRING THE PROPOSAL TO THE COM-
MISSIONER OF SECURITIES FOR APPROVAL, AND
AUTHORIZING EXECUTION OF A MEMORANDUM OF
AGREEMENT AND PREPARATION OF NECESSARY
DOCUMENTS.
BE IT RESOLVED by the City Council of the City of Chanhassen,
Minnesota, as follows:
1. It is hereby found, determined and declared as follows:
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1.1. The welfare of the State of Minnesota requires
active promotion, attraction, encouragement and development of
economically sound industry and commerce through governmental acts
to prevent, so far as possible, emergence of blighted lands and
areas of chronic unemployment, and the state has encouraged local
government units to act to prevent such economic deterioration.
1.2. Lyman Lumber Company, a Minnesota corporation
(hereinafter, the Company), has advised this Council of its desire
to construct and equip on certain land within the City, one or
more buildings (such land, buildings and equipment being herein-
after referred to as the Project), for use by the Company as a
storage and distribution facility and component plant for lumber
products and other building materials.
1.3. The existence of the Project within the City would
increase the tax base of the City, and would provide opportunities
for employment for residents of the City and surrounding area.
1.4. The City has been advised that conventional com-
mercial 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 signifi-
cantly reduced, but that with the aid of municipal financing, and
its resulting low borrowing cost, the Project is economically more
feasible.
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1.5. This Council has been advised by a representative
of Allison-Williams Company of Minneapolis, Minnesota, investment
bankers and dealers in municipal bonds, that on the basis of infor-
mation submitted to them and their discussions with representatives
of the Company and potential buyers of tax-exempt bonds, revenue
bonds of the City could be issued and sold upon favorable rates and
terms to finance the Project.
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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 inducement
to the Company to construct its facility within the City.
2. On the basis of information given to the City to date,
it appears that it would be in the best interest of the City to
issue its revenue bonds under the provisions of Chapter 474 to
finance the Project of the Company at a cost presently estimated
to be approximately $1,550,000.
3. The Project above referred to and the issuance of
bonds for such purpose and in such amount are hereby given preli-
minary approval by the City, subject to approval of the Project by
the Commissioner of Securities and to the mutual agreement of this body,
the Company and the initial purchasers of the bonds as to the details
of the bond issue and provisions for their payment, and subject,
further, to the reservation of the right by the City to deny the
application of the Company at any stage of the proceedings prior to
the adoption of the final resolution authorizing issuance of the
bonds.
4. In all events, it is understood, however, 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 thereon, is payable solely from the
revenues received from the Project and property pledged to the
payment thereof, and shall not constitute a debt of the City.
5. In accordance with the Minnesota Statutes, Section 474.01,
Subdivision 7, the Mayor is hereby authorized and directed to submit
the proposal for the Project to the Commissioner of Securities for
his approval of the Project. The Mayor, City Manager, City Attorney
and other officers, employees and agents of the City Attorney is
authorized to initiate and assist in the preparation of such documents
as may be appropriate to the Project, if it is approved by the
Commissioner.
Passed and adopted by
this 2nd day of October
the Council of the City of Chanhassen
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Mayor ~ ~
ATTEj /1 J /\ /l ---1-
~LL CJjL,u~
City Manager
YES
NO
Mqyor lIobb~
Councilman Waritz
CounciJ.Jman Neveaux
councilman Pearson
CounclLman GeVlng
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