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RES 1990-49 - 00003922RESOLUTION NO. 49 - 1990 ' RESOLUTION GIVING PRELIMINARY APPROVAL TO A PROJECT ON BEHALF OF THE LONG TERM CARE FOUNDATION AND ITS FINANCING UNDER THE MINNESOTA MUNICIPAL INDUSTRIAL DEVELOPMENT ACT; REFERRING THE PROPOSAL TO THE MINNESOTA DEPARTMENT OF TRADE AND ECONOMIC DEVELOPMENT FOR APPROVAL; AND AUTHORIZING THE PREPARATION OF NECESSARY DOCUMENTS BE IT RESOLVED by the City Council of the City of Fridley, Minnesota (the City), as follows: Section 1 Recitals and Findings 1.1 This Council has received a proposal that the City finance a portion or all of the cost of a proposed project under Minnesota Statutes, Sections 469.152 through 469.165 (the Act), on behalf of The Long Term Care Foundation, a Tennessee nonprofit corporation (the Borrower), consisting generally of financing the acquisition of and certain improvements to an existing nursing home facility, commonly known as Lynwood Healthcare Center located at 5700 East River Road in the City (the Project). 1.2 At a public hearing, duly noticed and held on July 23, 1990, in accordance with the Act and Section 147(f) of the Internal Revenue Code of 1986, on the proposal to undertake and finance the Project, all parties who appeared at the hearing were given an opportunity to express their views with respect to the proposal to undertake and finance the Project. Interested persons were also given the opportunity to submit written comments to the City Council before the time of comments (if any) and such other facts and circumstances as this Council deems relevant, this Council hereby finds, determines and declares as follows: (a) The welfare of the State of Minnesota requires the provision of necessary health care facilities to the end that adequate health care services can be made available to residents of the State of Minnesota at reasonable cost, and the State of Minnesota has encouraged local government units to act to provide such facilities. (b) The undertaking of the Project would further the general purposes contemplated and described in Section 469.152 of the Act. (c) This Council has been advised by representatives of the Borrower that conventional, commercial financing to pay the cost of the Project is available only at such high costs of borrowing that the economic feasibility of the project would be reduced. a. 1 6 137 Page 2 -- Resolution No. 49 - 1990 ' (d) This Council has also been advised by representatives of the Borrower that on the basis of their discussions with potential buyers of tax -exert bonds, revenue bonds of the City (which may be in the form of a revenue note or notes) could be issued and sold upon favorable rates and terms to finance the Project. (e) The City is authorized by the Act to issue its revenue bonds to finance capital projects consisting of properties used and useful in connection with a revenue producing enterprise engaged in providing health care services, such as that of the borrower, and the issuance of the bonds by the City would be a substantial inducement to the Borrower to urdertake the Project. SECTION 2 Determination to Proceed with the Project and Financing 2.1 on the basis of the information given to date, it appears that it would be desirable for the City to issue its revenue bonds under the provisions of the Act to finance the Project in the maximum aggregate face amount of $1,150,000. 2.2 It is hereby determined to proceed with the Project and the financing and this Council hereby declares its present intent to have the City issue its revenue bonds under the Act to finance the Project. Notwithstanding the foregoing, however, the adoption of this resolution shall not be deemed to establish a legal obligation on the part of the City or its Council to issue or to cause the issuance of such revenue bonds. All details of such revenue bond issue and the provisions for payment thereof shall be subject to final approval of the Project by the Minnesota Department of Trade and Economic Development (the Department) and may be subject to such further conditions as the City may specify. The revenue bonds, if issued, shall not constitute a charge, lien or encimbrance, legal or equitable, upon any property of the City, except the revenues specifically pledged to the payment thereof, and each bond, when, as and if insured, shall recite in substance that the bond, including interest thereon, is payable solely from the revenues and property specifically pledged to the payment thereof, and shall not constitute a debt of the City within the meaning of any constitutional, statutory or charter limitation. 2.3 The Application to the Minnesota Department of Trade and Economic Development (the Application), with attactments, is hereby approved, and the Mayor and City Council are authorized to execute said documents on behalf of the City. 2.4 In accordance with Section 469.154, Subdivision 3 of the Act, the Mayor and City Council are hereby authorized and directed to provide the Department with any preliminary information needed for this purpose. The City Attorney is authorized to initiate and assist in the preparation of such documents as may be appropriate to the Project, if approved by the Department. Page 3 — Resolution No. 49 - 1990 ISECTION 3 General Cl 3.1 If the bonds are issued and sold, the City will enter into a loan agreement or similar agreement satisfying the requirements of the Act (the Revenue Agreement) with the Borrower. The loan payments or other amounts payable by the Borrower to the City under the Revenue Agreement shall be sufficient to pay the principal of, and interest and redemption premium, if any, on the bonds as and when the same shall become due and payable. 3.2 The Borrower has agreed and it is hereby determined that any and all direct and indirect costs incurred by the City in connection with the Project, whether or not the Project is carried to completion, and whether or not approved by the Department, and whether or not the City by resolution authorizes the issuance of the bonds, will be paid by the Borrower upon request. 3.3 The Mayor and City Council are directed, if the bonds are issued and sold, thereafter to comply with the provisions of Section 469.154, Subdivision 5 and 7 of the Act. 3.4 This resolution shall become effective imTiediately upon its passage and without publication. PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDIEY THE 23RD DAY OF JULY, 1990.