RES 03-01 RESOLUTION NO. 03-0 I
1111.
A RESOLUTION OF THE ELK RIVER
HOUSING AND REDEVELOPMENT AUTHORITY
A RESOLUTION APPROVING POLICY ON INTERFUND LOANS OR
ADVANCES ("LOANS") FOR TAX INCREMENT FINANCING DISTRICT
("DISTRICTS") OF THE HRA WITHIN THE CITY OF ELK RIVER
IT IS HEREBY RESOLVED by the Board of Commissioners of the Housing and
Redevelopment Authority in and for the City of Elk River, Minnesota, as follows:
The following policy on interfund loans or advances ("Loans") for tax increment
financing district ("Districts") of the HRA within the City is hereby confirmed and
approved:
(a) The authorized tax increment eligible costs (including without limitation out-of-
pocket administrative expenses) payable from any of the Districts, as their
respective TIF Plans are originally adopted or may be amended, may need to be
financed on a short-term and/or long-term basis via one or more Loans, as may
be determined by the HRA's finance staff from time to time.
(b) The loans may be advanced by finance staff if and as needed from available
monies in the general or other available fund of the HRA designated by finance
staff. Loans may be structured as draw-down or"line of credit" obligations of
the lending fund(s).
(c) Neither the maximum principal amount of .ny one Loan nor the aggregate
principal amount of all Loans may exceed t e adopted and, if applicable, amended
TIF Plan budget for the applicable District.
(d) The maximum term of any Loan shall not e ceed the lesser of the statutory
duration limit of the District or such earlie date as finance staff may specify in
writing. All Loans may be pre-paid, in who!: or in part, whether from tax
increment revenue, TIF bond proceeds or •ether eligible sources.
(e) The outstanding and unpaid principal amou t of each Loan shall bear interest at
the rate prescribed by the statute (Minneso a Statues, Section 469.178,
Subdivision 7), which is the greater of the rates specified under Section 270.75
or 549.09 of the Statutes at the time of a Lean, or any part of it, is first made
subject to the right of finance staff to specify a lower rate (but generally not less
than the then-current average investment return for similar amount and term).
(f) Such Loans within the above guidelines are pre-approved. The Loans need not
take any particular form and may be undocumented, except that finance staff
dIshall maintain all necessary or applicable data on the Loans.
S/Eda/H RA/ResolutlTifLoan
• (g) Such Loans are also authorized in advance of the establishment of one or more
of the Districts; for example, when the HRA is advancing certain legal or other
costs associated with a possible District in connection with examining its
qualification or other preliminary matters. By way of example and not limitation,
the HRA is presently considering one or more downtown Districts to be
established and possibly developed in conjunction with the one or more
agreements with MetroPlains, or other suitable developers. In that regard, the
HRA has incurred and may continue to incur various preliminary expenses,
including without limitation legal, financial and other consulting fees. It is the
intention of the HRA to make interfund Loans to finance such purposes and to
repay those Loans, as may be permissible under the substantive rules of the tax
increment law, with interest, from the tax increments of the applicable Districts,
once established.
Passed and adopted by the Housing and Redevelopment Authority of the City of Elk
River, Minnesota this 276 day of January 2003.
•
4
Larry Toth, Chair
ATTEST:
atorkijaut ( • 0:214"-e*
Sandra A. Peine, City Clerk
411
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