Res 2017-56 Brenk Brothers Project
RESOLUTION NO. 2017- 56
RESOLUTION RECITING A PROPOSAL FOR AN
INDUSTRIAL DEVELOPMENT PROJECT TAKING OFFICIAL
ACTION WITH RESPECT THERETO INDICATING
PRELIMINARY INTENT TO ASSIST THE FINANCING
OF THE PROJECT PURSUANT TO THE MINNESOTA
MUNICIPAL INDUSTRIAL DEVELOPMENT ACT
(BRENK BROTHERS INC. PROJECT)
WHEREAS,
(a)The purpose of Minnesota Statutes, Sections 469.152 through 469.1655, as
amended known as the Minnesota Municipal Industrial Development Act (the "Act") as found
and determined by the legislature is to promote the welfare of the state by the active attraction
and encouragement and development of economically sound industry and commerce to prevent
so far as possible the emergence of blighted and marginal lands and areas of chronic
unemployment;
(b)Factors necessitating the active promotion and development of economically
sound industry and commerce are the increasing concentration of population in the metropolitan
areas and the rapidly rising increase in the amount and cost of governmental services required to
meet the needs of the increased population and the need for development of land use which will
provide an adequate tax base to finance these increased costs and access to employment
opportunities for such population;
(c)The City Council of the City of Fridley, Minnesota (the "City") has received a
proposal from Brenk Properties LLC, a Minnesota limited liability company and Brenk Brothers
Inc. a Minnesota corporation, (collectively, the "Company"), that the City assist in financing a
Project hereinafter described, through the issuance of revenue bonds, to be issued in one or more
series, in the principal amount not to exceed $7,000,000 (the "Bonds") pursuant to the Act;
(d)The City desires to facilitate the selective development of the community, retain
and improve the tax base and help to provide the range of services and employment opportunities
required by the population; and the Project will assist the City in achieving those objectives. The
Project will help to increase tax capacities of the City and surrounding area and help maintain a
positive relationship between tax capacities and debt and enhance the image and reputation of the
community;
(e)The "Project" to be financed by the Bonds is the acquisition of land, and the
construction and equipping of an approximately 44,000 square foot expansion of an existing
manufacturing facility located at 7490 Central Avenue Northeast in the City (together, the
"Project"). The Project is and will be owned, operated, and managed by Brenk Brothers Inc.
(f)The City has been advised by representatives of the Company that conventional,
commercial financing to pay the capital cost of the Project is available only on a limited basis
and at such high costs of borrowing that the economic feasibility of operating the Project would
be significantly reduced;
(g)No public official of the City has either a direct or indirect financial interest in the
Project nor will any public official either directly or indirectly benefit financially from the
Project.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fridley, Minnesota,
as follows:
1.The Council hereby indicates its preliminary intent to undertake the Project
pursuant to the Minnesota Municipal Industrial Development Act and to issue the Bonds in the
principal amount not to exceed $7,000,000 pursuant to the Act to finance the Project.
2.On the basis of information available to the Council it appears, and the Council
hereby finds, that the Project constitutes properties, real and personal, used or useful in
connection with one or more revenue producing enterprises within the meaning of Subdivision
2(a) of Section 469.153 of the Act; that the Project furthers the purposes stated in Minnesota
Statutes, Section 469.152; that the availability of the financing under the Act and willingness of
the City to furnish such financing will be a substantial inducement to the Company to undertake
the Project, and that the effect of the Project, if undertaken, will be to encourage the development
of economically sound industry and commerce, to assist in the prevention of the emergence of
blighted and marginal land, to help prevent chronic unemployment, to help the City retain and
improve the tax base and to provide the range of service and employment opportunities required
by the population, to help prevent the movement of talented and educated persons out of the
State and to areas within the State where their services may not be as effectively used, to
promote more intensive development and use of land within the City and eventually to increase
the tax base of the community.
3.The issuance of the Bonds by the City is subject to, among other things, (a) the
holding of a public hearing on the proposal, (b) the approval of the Project by the City and the
Minnesota Department of Employment and Economic Development, (c) review and approval of
the proposed Project by Bond Counsel, (d) final approval by this Council, the Company, and the
purchaser of the Bonds as to the ultimate details of the financing of the Project, and (e) receipt of
federal bonding allocation for the Bonds.
4.The Company has agreed and it is hereby determined that any and all costs
incurred by the City, including all fees required by the City's administrative policies, in
connection with the financing of the Project whether or not the Project is carried to completion
and whether or not approved by the City will be paid by Company.
5.Nothing in this resolution or in the documents prepared pursuant hereto shall
authorize the expenditure of any municipal funds on the Project other than the revenues derived
from the Project or otherwise granted to the City for this purpose. The Bonds shall not constitute
a charge, lien or encumbrance, legal or equitable, upon any property or funds of the City except
the revenue and proceeds pledged to the payment thereof, nor shall the City be subject to any
liability thereon. The holder of the Bonds shall never have the right to compel any exercise of
the taxing power of the City to pay the outstanding principal on the Bonds or the interest thereon,
or to enforce payment thereof against any property of the City. The Bonds shall recite in
substance that the Bonds, including interest thereon, are payable solely from the revenues of the
Project and proceeds pledged to the payment thereof. The Bonds shall not constitute a debt of
the City within the meaning of any constitutional or statutory limitation.
6.It is the purpose of this resolution to evidence the commitment of the parties and
their intentions with respect to the proposed Project in order that the Company may proceed
without delay with the commencement of the acquisition of the Project with the assurance that
there has been sufficient "official action" within the meaning of the Internal Revenue Code of
1986, as amended, to allow for the issuance of industrial revenue bonds (including, if deemed
appropriate, any interim note or notes to provide temporary financing thereof) to finance the
entire cost of the Project upon agreement being reached as to the ultimate details of the Project
and its financing.
7.In anticipation of the final approval by the City of the issuance of the Bonds to
finance all or a portion of the Project, and in order that completion of the Project will not be
unduly delayed when approved, the Company is hereby authorized to make such expenditures
and advances toward payment of that portion of the costs of the Project to be financed from the
proceeds of the Bonds as Company considers necessary, including the use of interim, short-term
financing, subject to reimbursement from the proceeds of the Bonds if and when delivered but
without liability on the part of the City.
8.A public hearing on the proposal of the Company will be held at a later date
requested by the Company and scheduled for public hearing by the City.
PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY,
TH
THIS 25 DAY OF SEPTEMBER, 2017.
SCOTT J. LUND - MAYOR
ATTEST:
____________________________________
DEBRA A. SKOGEN - CITY CLERK
STATE OF MINNESOTA
COUNTY OF ANOKA
CITY OF FRIDLEY
I, the undersigned, being the duly qualified and acting Manager of the City of Fridley,
Minnesota, DO HEREBY CERTIFY that I have compared the attached and foregoing extract of
minutes with the original thereof on file in my office, and that the same is a full, true and
complete transcript of the minutes of a meeting of the City Council of the City duly called and
held on the date therein indicated, insofar as such minutes relate to a resolution giving
preliminary approval to an industrial development project.
WITNESS my hand this ______ day of September, 2017.
________________________________
Manager