#82-074 07-06-82 Levying Taxes for Tax Increment Bonds358 Resolution 82-74
July 6, 1982
Member Anderson introduced and read the following resolution and moved its
adoption:
RESOLUTION RELATING TO $360,000 GENERAL OBLIGATION TAX INCREMENT BONDS;
FIXING THE FORM AND DETAILS, PROVIDING FOR THE EXECUTION AND DELIVERY THEREOF
AND THE SECURITY THEREFOR AND LEVYING TAXES FOR THE PAYMENT THEREOF
BE IT RESOLVED by the City Council of the City of Golden Valley, Minnesota (the
City), as follows:
Section 1. Authorization and Sale.
1.01. Authorization. This Council has designated a housing project pursuant
to Minnesota Statutes, Sections 462.421, Subdivision 12, and 273.73, Subdivision
8, and a tax increment financing district pursuant to Minnesota Statutes,
Sections 273.71 through 273.78. The tax increment financing district has been
designated Medley Park Tax Increment Finance District (the District).
1.02. This Council has approved the Medley Park Tax Increment Financing
Plan (the Plan) prepared by the Golden Valley Housing and Redevelopment Authority
with respect to the District. The Plan calls for the acquistion of all properties
within the District, site preparation work, installation of site improvements
and transfer of District properties to a developer for construction of a quality
housing project approved in accordance with City ordinances (the Project) to be
located on 8.5 acres of undeveloped land southeast of the intersection of Medicine
Lake Road with County Road 18 in northwestern Golden Valley.
1.03. The cost of the Project is estimated to be as follows:
Purchase of Land $208,000
Improvements, Other City Expenses 67,000
Capitalized Interest 63,000
Cost of Issuance 15,000
Discount 7,000
$0
1.04. Sale. This Council has determined to issue and sell $360,000 principal
amount of General Obligation Tax Increment Bonds of the City (the Bonds) to
finance the cost of the Project, $7,000 of said issue representing interest as
provided in Minnesota Statutes, Section 475.56. A public sale of the Bonds was
held on July 6, 1982, and this Council, by resolution adopted on that date,
accepted the bid of Allison -Williams of Minneapolis, Minnesota (the Purchaser)
to purchase the Bonds on the terms and conditions set forth in the Terms and
Conditions of Sale.
1.05. Issuance of Bonds. All acts, conditions and things which are
required by t eonstitution and laws of the State of Minnesota to be done, to
exist, to happen and to be performed prior to the issuance of the Bonds having
been done, existing, and having happened, it is now necessary for this Council
to establish the form and terms of the Bonds, to provide for the security
thereof, and to issue the Bonds forthwith.
Section 2. Form of Bonds and Coupons.
2.01. Form of Bonds. The Bonds shall be prepared in substantially the
following form:
1
1
1
Resolution 82-74 - Continued
UNITED STATE OF AMERICA
STATE OF MINNESOTA
COUNTY OF HENNEPIN
CITY OF GOLDEN VALLEY
GENERAL OBLIGATION TAX INCREMENT BOND
July 6, 1982 359
$5,000
The City of Golden Valley, Hennepin County, Minnesota (the City),
acknowledges itself to be indebted, and, for value received, hereby promises to
pay to bearer upon presentation and surrender hereof, the principal sum of
FIVE THOUSAND DOLLARS
on February 1, 19 , or, if this Bond is prepayable as stated below, on any date
prior thereto onhw ch it shall have been duly called for redemption, and to pay
interest thereon from the date hereof until said principal sum is paid, or, if this
Bond is prepayable, until it has been duly called for redemption and the principal
thereof and the interest thereon to the date of redemption have been paid or
deposited with the paying agent designated below, at the rate of
hundredths percent ( %) per annum. Interest hereon is payable semiannually
on February 1 and August 1 in each year, commencing February 1, 1983, in
accordance with and upon presentation and surrender of the interest coupons
hereto appurtenant. Both principal and interest are payable at the ,
in , or its successor as paying agent, in any
coin or currency of the United States of America which on the respective dates
of payment is legal tender for public and private debts. For the prompt and
full payment of such principal and interest as the same become due, the full
faith, credit and taxing powers of the City are hereby irrevocably pledged.
This Bond is one of an issue in the aggregate principal amount of $360,000
(the Bonds), all of like date and tenor except as to serial number, interest
rate, maturity date, and redemption privilege, issued for the purpose of paying
the capitol and administrative costs of a development program in Medley Park Tax
Increment District (the District) in the City, and is issued pursuant to and in
full conformity with the provisions of the Constitution and laws of the State of
Minnesota thereunto enabling, including Minnesota Statutes, Section 462.581,
Section 273.77 and Chapter 475.
Bonds maturing in the years 1985 through 1992 are payable on their respective
stated maturity dates without option of prior payment, but Bonds having stated
maturity dates in the years 1993 through 1997 are each subject to redemption and
prepayment, at the option of the City and in inverse order of serial numbers, on
February 1, 1992 and on any interest payment date thereafter, at their principal
amount plus accrued interest to the date of redemption. At least thirty days
prior to the date set for redemption of any Bond, notice of the call for redemption
will be published in a daily or weekly periodical, published in a Minnesota city
of the first class or its metropolitan area, which circulates throughout the
state and furnishes financial news as a part of its service, and will be mailed
to the bank at which the Bonds are then payable and to the holders thereof, if
known, but no defect in or failure to give such mailed notice of redemption shall
affect the validity of proceedings for the redemption of any Bond. Holders of
prepayable Bonds who desire to receive such notice may register their names and
addresses and the serial numbers of their Bonds with the City Finance Director -
Clerk in Golden Valley, Minnesota.
3 L O Resolution 82-74 - Continued
July 6, 1982
IT IS HEREBY CERTIFIED, RECITED, COVENATED AND AGREED that all acts,
conditions and things required by the Constitution and laws of the State of
Minnesota to be done, to exist, to happen and to be performed precedent to and
in the issuance of this Bond in order to make it a valid and binding general
obligation of the City according to its terms have been done, do exist, have
happened and have been performed in regular and due form, time and manner; that
the City has agreed to pledge all tax increment revenue derived from the District
to the payment of the Bonds; that all taxable property within the City is subject
to the levy of a direct, annual, ad valorem tax, which the City covenants it will
levy and which is required to be extended, assessed and collected for the years
and in such amounts as may be required to pay the principal of and interest on
the Bonds of this issue when due, which levy is not limited as to rate or amount;
and that the issuance of this Bond did not cause the indebtendess of the City to
exceed any constitutional or statutory limitation.
IN WITNESS WHEREOF, the City of Golden Valley, Hennepin County, State of
Minnesota, by its City Council, has caused this Bond to be executed by the
facsimile signature of the Mayor and the manual signature of the City Manager,
and by a printed facsimile of the offical seal of the City, has caused the
interest coupons appurtenant hereto and the certificate appearing on the reverse
side hereof to be executed and authenticated by the facsimile signatures of said
officers, and has caused this Bond to be dated as of July 1, 1982.
ATTEST:
(Facsimile Signature)
City Manager Mayor
(FACSIMILE SEAL)
2.02. Form of Coupons. Interest on each Bond to maturity shall be
represented by a consecutively numbered set of interest coupons printed in
substantially the following form:
a"
On the first day of February (August), 19 , unless the Bond to which
this coupon appertains shall previously have been called for redemption and
provision for the payment thereof has been made, the City of Golden Valley,
Hennepin County, Minnesota will pay to bearer at the , in
the sum shown hereon in coin or currency of
the United States of America which at the time of payment is legal tender for
payment of public and private debts, for interest then due on its General
Obligation Tax Increment Bond, dated July 1, 1982, No.
(Facsimile Signature)
City Manager
(Facsimile Signature)
Mayor
2.03. Form of Certificate. A certificate in substantially the following
form shall be printed on the reverse side of each Bond, following a copy of the
text of the legal opinion to be rendered by Bond Counsel:
We certify that the above is a full, true and correct copy of the legal
opinion rendered by Bond Counsel on the issue of Bonds of the City of Golden
Valley, Minnesota, which includes the within Bond, dated as of the date of
delivery of and payment for the Bonds.
1
Resolution 82-74 - Continued July 6, 1982 361
(Facsimile Signature) (Facsimile Signature)
City Manager Mayor
Section 3.01. Bond Terms, Execution and Delivery.
3.01. Date, Amount, Denomination and Maturity. The City shall forthwith
issue and deliver the Bonds, which shall e negotiable coupon bonds, denominated
General Obligation Tax Increment Bonds. The Bonds shall be dated as of July 1,
1982, shall be 72 in number and numbered from 1 to 72, inclusive, each in the
denomination of $5,000. The Bonds shall mature in order of serial numbers on
February 1 in the years and amounts set forth below, and the Bonds of each
annual maturity shall bear interest from date of issue until paid or duly called
for redemption at the rate per annum shown opposite the year of such maturity as
follows:
Year Amount Rate Year Amount Rate
3 �$�
$T5 --'O 0 T. -G -U% 3 f $TF,W 1=%
1986 $15,000 9.75% 1993 $30,000 11.30%
1987 $15,000 10.00% 1994 $35,000 11.5071,
1988 $20,000 10.25% 1995 $40,000 11.75%
1989 $20,000 10.50% 1996 $45,000 12.00%
1990 $20,000 10.75% 1997 $50,000 12.00910
1991 $25,000 11.00%
3.02. Interest. Interest on the Bonds shall be payable semiannually on
February 1 ani August 1 in each year, commencing on February 1, 1983.
3.03. Paying Agent. The Purchaser has designated First National Bank of
Minneapolis, in Minneapolis, Minnesota, as paying agent. That recommendation is
hereby approved. The City will pay the usual and customary charges of said
paying agent for the receipt and disbursement of principal and interest moneys.
The principal of and interest on the Bonds shall be payable at the principal
corporate trust office of the paying agent designated herein, or, in the event
of its resignation, removal or incapability of acting as paying agent, at the
office of such successor paying agent as may be approved by this Council. Upon
merger or consolidation of the paying agent with another corporation, if the
resulting corporation is a bank or trust company authorized by law to conduct
such business, such corporation shall be authorized to act as successor paying
agent. No resignation of the paying agent and no appointment of a successor
paying agent shall become effective until the date specified in a notice of the
appointment which the Council shall cause to be printed in a daily or weekly
periodical published in a Minnesota city of the first class or its metropolitan
area, which circulates throughout the state and furnishes financial news as a
part of its service, a copy of which notice shall also be mailed to the
Purchaser of the Bonds, not less than thirty days before said effective date.
3.04. Redemption. Bonds maturing in the years 1985 through 1992 are
payable on their respective stated maturity dates without option of prior
payment, but Bonds having stated maturity dates in the years 1993 through 1997
are each subject to redemption and prepayment, at the option of the City and in
inverse order of serial numbers, on February 1, 1992 and on any interest payment
date thereafter, at their principal amount plus accrued interest to the date of
redemption. At least thirty days prior to the date set for redemption of any
Bond, notice of the call for redemption will be published in a daily or weekly
periodical, published in a Minnesota city of the first class or its metropolitan
area, which circulates throughout the state and furnishes financial news as a
362 Resolution 82-74 - Continued July 6, 1982
part of its service, and will be mailed to the bank at which the Bonds are then
payable and to the holders thereof, if known, but no defect in or failure to
give such mailed notice of redemption shall affect the validity of proceedings
for the redemption of any Bond. Holders of prepayable Bonds who desire to
receive such notice may register their names and addresses and the serial numbers
of their Bonds with the City Finance Director -Clerk in Golden Valley, Minnesota.
3.05. Preparation and Delivery. The Bonds shall be prepared under the
direction of the City Manager an sal l be executed on behalf of the City by
the signatures of the Mayor and the City Manager, and shall be sealed with the
official corporate seal of the City, provided that one of said signatures and
the corporate seal may be printed, engraved, or lithographed facsimiles thereof.
On the reverse side of each Bond shall be printed a copy of the legal opinion
rendered thereon by Bond Counsel and the certificate of the Mayor and City
Manager. The certificate as to legal opinion and interest coupons attached to
the Bonds shall be executed and authenticated by the printed, engraved or
lithographed facsimile signatures of the Mayor and City Manager. When the Bonds
have been so executed and authenticated, they shall be delivered by the City
Manager to the Purchaser upon payment of the purchase price in accordance with
the contract of sale heretofore made and executed, and the Purchaser shall not
be obliged to see to the application of the purchase price.
Section 4. Security Provisions.
4.01. Construction Fund. A Construction Fund is hereby created as a
special fund and esignate on the books of the City as the "Medley Park Tax
Increment Finance District Construction Fund" (the Construction Fund), to be
held and administered by the City Finance Director -Clerk separate and apart from
all other funds of the City. The City hereby appropriates to the Construction
Fund all of the proceeds received from the sale of the Bonds, less the amount to
be deposited in the Bond Fund, as hereinafter defined, pursuant to Section 4.02
hereof. Moneys on hand in the Construction Fund from time to time shall be used
solely to pay capital and administrative costs in connection with the Project as
set forth in the Plan. Any amounts remaining in the Construction Fund upon
completion of the Project and payment of all of the costs thereof shall be
transferred to the Bond Fund.
4.02. Bond Fund. So long as any of the Bonds, or any additional bonds
issued pursuant to Section 4.04 hereof and made payable from the Bond Fund, are
outstanding and any principal thereof or interest thereon unpaid, the City
Finance Director -Clerk shall maintain the Bond Fund, which shall be designated
on the books of the City as the "1982 General Obligation Tax Increment Bond Fund"
(the Bond Fund), as a separate and special account to be used for no purpose
other than the payment of the principal of, premium, if any, and interest on the
Bonds or any other development costs in connection with the District which are
authorized by law to be paid from tax increments derived from the District. The
City hereby irrevocably appropriates to the Bond Fund (a) $63,000 of the proceeds
of the Bonds representing capitalized interest, (b) the accrued interest and any
amount in excess of $353,000 bid for the Bonds and received from the Purchaser
upon delivery of the Bonds, and (c) any other moneys appropriated or pledged by
the terms of this Resolution to the Bond Fund.
1
Resolution 82-74 - Continued July 6, 1982
4.03. Tax Increment. The Director of Property Taxation has certified that
the original taxable va ue of real property within the District according to the
assessment of January 2, 1981, is $51,718. Under the provisions of Minnesota
Statutes, Section 462.585, Subdivision 3, the Director of Property Taxation will
include only the original taxable value according to the the assessment as of
January 2, 1982 in the assessed valuation upon which he computes the rate of all
state, county, city, school district and other taxes, but will extend the rates
so determined against the entire assessed valuation of such real property in 1983
and each subsequent year, and the County Treasurer will remit to the Authority
that the proportion of the taxes paid each year on such real property within the
District which the excess of the assessed valuation over the original taxable
value bears to such original value. The Authority has agreed to segregate the
tax increments so received until the public redevelopment cost of the Project,
including principal and interest on the Bonds, has been paid and the City has
been fully reimbursed for any principal of and interest on the Bonds which has
been paid from the city-wide taxes herein levied. The Authority has pledged and
appropriated the tax increments to the Bond Fund for the payment of such principal
and interest and the reduction, cancellation and reimbursement of such taxes.
4.04. Additional Bonds. The City reserves the right to issue additional
bonds payable rom the Bond Fund as may be required to finance costs of the
Project not financed hereby or to finance costs of other projects to be under-
taken by the City within the District.
4.05. Tax Levy. The full faith and credit and taxing powers of the City
are irrevocaB y p�eUged for the prompt and full payment of the principal of and
interest on the Bonds and on all other bonds made payable from the Bond Fund, as
such principal and interest become due. It is estimated that the tax increments
appropriated to the Bond Fund in Section 4.02 will produce sums available for the
payment of the Bonds at the times and in the amount required by Minnesota Statutes,
Section 475.61, and therefor as permited by Minnesota Statutes, Section 273.77(a),
no taxes are levied for this purpose at the present time. It is recognized,
however the the city's liability on the Bonds is not limited to the provision of
these funds, and that the City is required by Minnesota Statutes Section 273.77(a)
and Section 475.61, to levy and cause to be extended, assessed and collected any
ad valorem taxes necessary for the payment of principal of and interest on the
Bonds.
Section 5. Defeasance. When all of the Bonds and all coupons appertaining
thereto have been discharged as provided in this Section 5, all pledges, covenants
and other rights granted by this Resolution to the holders of the Bonds shall
cease. The City may discharge its obligations with respect to any Bonds and
coupons appertaining thereto which are due on any date by irrevocably depositing
with the paying agent on or before that date a sum sufficient for the payment
thereof in full; or, if any Bond or coupon should not be paid when due, it may
nevertheless be discharged by depositing with the paying agent a sum sufficient
for the payment thereof in full with interest accrued to the date of such deposit.
The City may also discharge its obligations with respect to any prepayable Bonds
which are called for redemption on any date according to their terms by depositing
with the paying agent on or before that date an amount equal to the principal,
interest and redemption premium, if any, which are then due thereon, provided
that notice of such redemption has been duly given as provided herein. The City
may also at any time discharge its obligations with respect to any Bonds, subject
to the provisions of law now or hereafter authorizing and regulating such action,
by depositing irrevocably in escrow, with a bank qualified by law as an escrow
agent for this purpose, cash or securities which are general obligations of the
363
364 Resolution 82-74 - Continued July 6, 1982
United States or securities of United States agencies which are authorized by
law to be so deposited, bearing interest payable at such time and at such rates
and maturing on such dates as shall be required, without reinvestment, to pay
all principal and interest to become due thereon to maturity, or if then duly
redeemed, to the date of redemption.
Section 6. Registration, Certification of Proceedings, Investment of
Moneys and Arbitrage.
6.01. Registration. The City Finance Director -Clerk is hereby authorized
and directed to file a certifed copy of this resolution with the Director of
Property Taxation of Hennepin County, together with such other information and
he/she shall require, and to obtain from said Director of Property Taxation a
certificate that the bonds have been entered on the bond register of the Hennepin
County Auditor and that the tax required for the payment thereof has been levied
and filed as required by law.
6.02. Certification of Proceedings. The officers of the City and the Director
of Property axation of Hennepin County are hereby authorized and directed to
prepare and furnish to the Purchaser and to Dorsey & Whitney Bond Counsel, certified
copies of all proceedings and records of the City, and such other affidavits,
certificates and information as may be required to show the facts relating to the
legality and marketability of the Bonds as the same appear from the books and
records under their custody and control or as otherwise known to them, and all such
certified copies, certificates and affidavits, including any heretofore furnished,
shall be deemed representations of the City as to the facts recited therein.
6.03. Covenant. The City covenants and agrees with the holders from time
to time of the Bonds that it will not take or permit to be taken by any of its
officers, employees or agents any action which would cause the interest on the
Bonds to become subject to taxation under the Internal Revenue Code of 1954, as
amended (the Code), and the Treasury Regulations promulgated thereunder.
6.04. Investment of Moneys on Deposit in Bond Fund. The City Finance
Director -Clerk shall ascertain monthly the amount onde—posit in the Bond Fund.
If the amount on deposit therein ever exceeds by more than $54,000 the aggregate
amount of principal and interest due and payable from the Bond Fund within the
next succeeding 12 months thereafter plus a reasonable carryover amount not
exceeding the greater of one year's earnings on the Bond Fund or one -twelfth of
the annual debt service payable thereafter, then to the extent necessary to
prevent the Bonds from being arbitrage bonds, such excess shall either (a) be
used to prepay and redeem Bonds, or (b) not be invested except at a yield less
than or equal to the yield on the Bonds, based upon their amounts, maturities
and interest rates on their date of issue, computed by the actuarial method. If
any additional bonds are ever issued and made payable from the Bond Fund pursuant
to Section 4.04 hereof, the dollar amount in the preceding sentence shall be
changed to equal 15 percent of the aggregate principal amount of all bonds,
including the Bonds, which are then outstanding and payable therefrom. The City
reserves the right to amend the provisions of this Section 6.04 at any time,
whether prior to or after the delivery of the Bonds, if and to the extent that
this Council determines that the provisions of this Section 6.04 are not
necessary in order to ensure that the Bonds are not arbitrage bonds within the
meaning of Section 103(c) of the Code and applicable Treasury Regulations.
Resolution 82-74 - Continued July 6, 1982
6.05. Arbitrage. The Mayor and City Manager, being the officers of the
City chargedwi h the responsibility for issuing the Bonds pursuant to this
resolution, are authorized and directed to execute and deliver to the Purchaser
a certificate in accordance with the provisions of Section 103(c) of the Code,
and Treasury Regulations, Sections 1.103-13, 1.103-14 and 1.103-15, stating the
facts, estimates and circumstances in existence on the date of issue and delivery
of the Bonds which make it reasonable to expect that the proceeds of the Bonds
will not be used in a manner that would cause the bonds to be arbitrage bonds
within the meaning of the Code and Regulations.
6.06. Execution of Documents. The Mayor, City Manager and City Finance
Director -Clerk are hereby authorized to execute and deliver on behalf of the
City such documents as may be appropriate to evidence the pledge and appropriation
of the Tax Increment Revenues to the City by the Authority.
6.07. Official Statement. The Official Statement dated as of June 23,
1982, relating to the Bonds, prepared and distributed by the City in cooperation
with Evensen-Dodge, Inc., is hereby approved and the appropriate officers of the
City are hereby authorized and directed to execute such certificates as are
appropriate with respect to the completeness and accuracy of the official
statement.
Rosemar horsen or
ATTEST:
4nu y,City e r
The motion for the adoption of the foregoing resolution was seconded by Member
Stockman and upon a vote being taken thereon, the following voted in favor
thereof: Anderson, Johnson, Mitchell, Stockman and Thorsen, and the following
voted against the same: none, whereupon said resolution was declared duly
passed and adopted, signed by the Mayor and her signature attested by the City
Clerk.
1
365