HomeMy Public PortalAbout2019-85 Resolution Authorizing Internal Loan in Connection with the Redemption of GO Bonds Series 2012BMember Pederson introduced the following resolution and moved its adoption.
CITY OF MEDINA,'MINNESOTA
RESOLUTION NO.2019-85
RESOLUTION AUTHORIZING INTERNAL LOAN IN
CONNECTION WITH THE REDEMPTION OF THE CITY'S
GENERAL OBLIGATION REFUNDING BONDS, SERIES 2012B
WHEREAS, the City of Medina, Minnesota (the "City"), previously issued its General Obligation
Refunding Bonds, Series 2012B (the "Bonds"), dated November 7, 2012, in the original aggregate
principal amount of $2,845,000; and
WHEREAS, the Bonds are subject to redemption on or after February 1, 2020 at a price of par
plus accrued interest and are currently outstanding in the principal amount of $555,000; and
WHEREAS, pursuant to a resolution adopted by the City Council of the City (the "Council") on
December 3, 2019, the City has determined to redeem and prepay the Bond maturing on February 1, 2021
in the principal amount of $90,000 (the "Refunded Maturity") on February 1, 2020 (the "Redemption
Date"); and
WHEREAS, the City intends to advance funds from its Sewer Capital Fund, or any other fund
designated by the City, in the amount of $90,000 in order to redeem and prepay the Refunded Maturity of
the Bond and proposes to designate such advance as an interfund loan in accordance with the terms of this
resolution; and
WHEREAS, the City intends to repay such interfund loan using tax increment. revenues derived
from Tax Increment Financing District No. 1-9 (the "TIF District") within the Development District No. 1
in the City, which was originally pledged to the payment of the Bonds; and
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
MEDINA, MINNESOTA AS FOLLOWS:
1. The City shall borrow from the City's Sewer Capital Fund, or any other fund designated
by the City, the amount of $90,000 to pay the principal amount of the Refunded Maturity
of the Bond on the Redemption Date (the "Interfund Loan").
2. The interest shall accrue on the principal amount from the date of disbursement of the
Interfund Loan at the rate of 4% per annum, which shall be payable from the Available
Tax Increment (defined herein) or other available funds of the City authorized to be used
to repay the Interfund Loan.
3. Payments of principal of and interest (the "Payments") on the Interfund Loan shall be
paid semiannually on each February 1 and August 1 (each a "Payment Date"),
commencing on February 1, 2020 and continuing until the principal of and interest on the
Interfund Loan is paid in full.
4. 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
Resolution No. 2019-85
December 17, 2019
have been paid, or as determined by the Financial Director of the City, generated in the
preceding six (6) months with respect to the property within the TIF District and remitted
to the City by Hennepin County, Minnesota, all in accordance with Minnesota Statutes,
Sections 469.174 through 469.1794, as amended (the "TIF Act"). Payments on the
Interfund Loan may be subordinated to any outstanding or future bonds or notes issued
by the City, including but not limited to the Bonds, and secured in whole or in part with
Available Tax Increment. The Interfund Loan shall be paid prior to any pay-as-you-go
notes or contracts secured in whole or in part with Available Tax Increment, and any
other outstanding or future interfund loans secured in whole or in part with Available Tax
Increment.
5. Payments on the Interfund Loan will be made in the amount and only to the extent that
Available Tax Increment is available and shall be applied first to accrued interest, and
then to unpaid principal.
6. The principal sum and all accrued interest payable under the Interfund Loan is prepayable
in whole or in part at any time by the City without premium or penalty.
7. The Interfund Loan is evidence of an internal borrowing by the City in accordance with
Minnesota Statutes, Section 469.178, and is a limited obligation payable solely from the
Available Tax Increment pledged to the payment thereof under this resolution.
8. The City may amend the terms of the Interfund Loan at any time by resolution of the
Council, to the extent permissible under law.
Dated: December 17, 2019.
Kathleen Martin, Mayor
ATTEST:
1�
9M Gall
Jodi up, City Clerk
The motion for the adoption of the foregoing resolution was duly seconded by member Albers and upon
vote being taken thereon, the following voted in favor thereof:
Albers, Anderson, DesLauriers, Martin, Pederson
And the following voted against same:
None
Whereupon said resolution was declared duly passed and adopted.
Resolution No. 2019-85 2
December 17, 2019