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HRA RES 2014-09 INTERFUND LOAN (COLUMBIA ARENA) HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA COUNTY OF ANOKA STATE OF MINNESOTA HRA RESOLUTION NO. 2014-09 A RESOLUTION APPROVING INTERFUND LOANS ASSOCIATED WITH THE PROPOSED COLUMBIA ARENA REDEVELOPMENT PROJECT AND THE REPAYMENT OF A CITY LOAN BE IT RESOLVED by the Board of Commissioners (the “Commissioners”) of the Housing and Redevelopment Authority in and for the City of Fridley (the “Authority”) as follows: Section 1. Recitals. 1.01 The Authority is considering the redevelopment of the property located at 7011 University Avenue NE described as PIN 11-30-24-34-0002 (the “Columbia Arena Site” or “Site”) 1.02The City of Fridley Minnesota (the “City”) is providing a loan in the amount of $1,500,000 (the “City Loan”) for certain Qualified Costs defined below. 1.03The Authority has also agreed to finance certain costs in categories identified on Exhibit A (the “Qualified Costs”) on a temporary basis from Authority funds available for such purposes. 1.04The Authority will loan money to finance Qualified Costs under Minnesota Statutes, Section 469.176, Subdivision 4 from its general fund or any other fund under which it has legal authority to do so, pursuant to Minnesota Statutes, Section 469.178, Subdivision 7. 1.04 The Authority intends to create a redevelopment tax increment financing district (the “TIF District”) on the Site pursuant to Minnesota Statutes, Section 469.174, Subdivision 10 and to pay for Qualified Costs pursuant to Minnesota Statutes, Section 469.176, Subdivision 4j. 1.05 The Authority intends to reimburse itself and the City for the Qualified Costs from tax increments generated from the TIF District, once it is created, in accordance with terms of this resolution (which terms are referred to collectively as the “TIF Loans”). 1.06 The Authority acknowledges the need to create and maintain an ongoing Register of Advances (the “Register”), as shown on Exhibit A, to reflect the continuing interfund loans and advances in accordance with the TIF Loans. HRA Resolution No. 2014-09 Page 2 Section 2. Terms of the TIF Loans. 2.01 The Authority shall repay the City Loan and the specific Authority fund from which the Qualified Costs were and are to be paid, the principal amounts as shown on Exhibit A attached hereto, together with accrued interest from the date of each expenditure at a rate which may not exceed 3.5% or the greater of the rates specified under (a) Minnesota Statutes, Sec. 270C.40 or (b) Minnesota Statutes, Sec. 549.09. The interest rate for each calendar year during the term of each TIF Loan shall be determined as of each January 1 using the maximum rate under clause (a) or (b) in effect as of that date if it is less than 3.5%. 2.02 Principal and interest payments (the “Payments”) for each TIF Loan and the City Loan shall be paid annually on December 31 of the first year of receipt of Available Tax Increment (defined in Sec. 2.03 below) and on each December 31 thereafter (the “Payment Dates”), up to and including the earlier of (a) payment in full of each TIF Loan or (b) the termination date of the TIF District. Payments shall be applied first to accrued interest and the balance to the reduction of principal. Interest accruing from the date of each expenditure to the first Payment Date shall be compounded annually on December 31 of each year and added to principal. 2.03 Payments on each TIF Loan and the City Loan are payable solely from Available Tax Increment, which shall mean the tax increment available from the TIF District and available for that purpose from any other tax increment financing district, after withholding (a) allowable Authority administrative fees, and (b) prior obligations, which shall include all general obligation or revenue bonds or notes for which the tax increment revenues of the TIF District or other tax increment financing districts are pledged. The Available Tax Increment shall be allocated between the City Loan and the TIF Loans in proportion to their share of the total outstanding principal on each Payment Date. 2.04 The principal sum and accrued interest payable under each TIF Loan and the City Loan may be prepaid in whole or in part at any time without premium or penalty. No partial prepayment of any TIF Loan or City Loan shall affect the amount or timing of any regular payments otherwise required to be made under the TIF Loans or City Loan. 2.05 Each TIF Loan and the City Loan is evidence of internal borrowing by the Authority and the City respectively in accordance with Minnesota Statutes, Section 469.178, Subdivision 7, and are limited obligations payable solely from the Available Tax Increments pledged to the payment thereof under this resolution and the City resolution approving the City Loan. The Authority shall have no obligation to pay any principal amounts of the TIF Loans and the City Loan or accrued interest thereon which may remain unpaid after the final Payment Date. 2.06 The Authority may amend the terms of any TIF Loan at any time by resolution of the Board of Commissioners, and the City may amend the terms of the City Loan at any time by resolution of the City Council. Both the Authority and the City may make a determination to forgive the outstanding principal amounts and accrued interest to the extent permissible under law. HRA Resolution No. 2014-09 Page 3 Section 3. Approval. The Board of the Authority hereby approves the creation of a Register of Advances and the appointment of the Finance Director of the City to maintain the Register to reflect an accurate accounting of the City and Authority interfund loans and advances, and approves their repayment in accordance with this Resolution. PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY THIS 7th DAY OF AUGUST 2014. __________________________________ Lawrence R. Commers, Chairman ATTEST: __________________________________ Walter T. Wysopal, Executive Director HRA Resolution No. 2014-09 Page 4 EXHIBIT A REGISTER OF ADVANCES [SAMPLE FORM FOR SOURCE OF ADVANCE] QUALIFIED EXPENSE DATE PAID AMOUNT PAID Land/Building Acquisition Site Improvements/Preparation Costs Utilities Other Public Improvements Construction of Affordable Housing Authority Administrative Costs County Administrative Costs Bond Payments – Paygo & all other Bonds – Principal Bond Payments – Paygo & all other Bonds – Interest