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278323 WHITE - CITY CLERK PINK - FINANCE 7 �'18323-. CANARY - DEPARTMENT G I TY O F SA I NT I,A U L COUIICII BLUE - MAYOR City Attny/.7TH File N . o ncil Resolution Presented Referred T Committee: Date Out of Committee By Date RESOLUTION AUTHORIZING PROPER CITY OFFICIALS TO EXECUTE DISTRICT HEATING DESIGN LOAN AGREEMENTS WITH THE STATE OF MINNESOTA AND DISTRICT HEATING DEVELOPMENT COMPANY WHEREAS, by Resolution C.F. 277771 adopted December 3, 1981, the City Council of Saint Paul authorized and directed the proper City officials to secure on behalf of the District Heating Development Company a District Heating Design Loan under provision of Chapter 334 , Laws of Minnesota 1981, from the State of Minnesota in the amount of $498,500; and WHEREAS, the State of Minnesota has approved the City' s District Heating Design Loan request and submitted a Loan Agree- ment in amount of $498,500, twenty year term, e�timated 11 1/2 to 12 1/2 percent per annum interest, payable semi-annually; now therefore, be it RESOLVED, that the proper City officials are authorized and directed to enter into the Loan Agreement with the State of Minnesota to secure the District Heating Design Loan in the amount of $498,500, provided said Agreement authorizes pre- payment at the option of the City and is otherwise in form satisfactory to and approved by the City Attorney. BE IT FURTHER RESOLVED, that the proper City officials are authorized and directed to enter into a subsidiary Loan Agreement with the District Heating Development Company consistent with the provision of Chapter 334, Laws 1981 and the State of Minnesota Loan Agreement making provision for disbursement of said Loan proceeds and the means and security for their repayment, in form satisfactory to and as approved by the City Attorney. COUNC[LMEN Requestgd by D rtment of: � Yeas Nays -trerfT" Levine In Favor � a McMahon B snowaiter __ Against Y Tedesco Wilson FEg 2 5 �ga2 Form Approv City At orney Adopted by Council: Date — � , CertiEied b ,ec ry BY � By Appr by Ylavor: t ���� � ���Z Approve Mayor for Submission to Coun il By — By P�UBUSHED MRR � 1982 � J �V��� • LOAN AGREEMENT THIS AGREEMENT dated as of , 1982, between the State of Minnesota Commissioner of Finance, called herei n the State, and the Ci ty of St. Paul , cal l e� herei n the Ci ty, under and pursuant to the provisions of Minnesota Laws 1981 , Chapter 334, Section 1 , WITNESSETH, that the State and the City, each in consider- ation of the representations, covenants and agreements of the other as set forth herein, mutually represent, covenant and agree as follows: Section 1 . Pursuant to Laws of Minnesota 1981 , Chapter 334, and upon application that details the eligibility and request � for and use of the Design Phase Loan, the State shall loan to the City of St. Paul an amount not exceeding �498,500 for design phase activities relating to the St. Paul District Heating System. Section 2. The State will , no later than , sel l and i ssue Bonds i n the amount of $498,500, for the purpose of providing money to be loaned to the City to finance the District Heating Design Project. The premium and accrued interest received � from the purchasers of the bonds shall be deposited in the City of St. Paul District Heating Bond Account in the State Bond Fund, and the State agrees to loan the proceeds of the bonds in the amount of �498,500, to the City upon the term s and conditions set forth in � this Agreement. • Section 3. The loan shall bear interest at the annual rate borne by the bonds issued therefor and shall be payable in annual � installments equivalent to the principal and interest which the State is obligated to pay annually to properly retire the bonds . issued to provide the loan to the City. Section 4. The City hereby agrees to use the amounts loaned to it under this agreement exclusively to carry out tasks related to the design of the St. Paul District Heating System a11 as � 7 � _3.2.� fully set forth in that particular application submitted by City for a design loan. Section 5. The City agrees to repay the proceeds of the State's bond issue or issues loaned to the City, plus all reasonable expenses incurred� by the State in connection with the issuance of the State General Obligation Bonds, together with. inte rest thereon, under the term s of Laws of Minnesota 1981 , Chapter 334, and the provi si ons of _ thi s agreement. A schedule estimati ng the dates and amounts of payments hereunder is attached as Exhibit A and incorpor- � ated herein by reference, provided that actual amounts due, (which � � are payable with the first installment being withheld from the proceeds of the first bond issue, and by annual installments on or before October 31 of each ensuing year) shall be in those annual amounts necessary, when added to the balance on hand in the Bond � Account maintained by the State, to pay all principal and interest due or to become due on the bonds through July 1 of the second ensuing year, plus any expenses necessarily and reasonably incurred by the State in issuing bonds under the authority of Laws of Minne- sota 1981 , Chapter 334. Section 6. The following provisions govern the City's obligation hereunder: (a) The payments required in Section 5, above, are payable from the proceeds of the bonds and from the non ad valorem revenues of the City, exclusive of restricted funds and City debt service obligations existing on the effective date of this agreement. (b) If in any year the installment payment of the loan made available by the City is less than the installment due, the deficiency together with interest thereon shall become due and payable. Interest on the deficiency shall be calculated at the average rate of return on invested treasurers cash for the year in which the deficiency occurs. . (c) If a deficiency arises, the City shall be considered in default. (d) Upon default, the Commissioner of Finance shall give �ritten notice and a demand for the full payment of all amounts due, including interest on any deficiency. (e) If, within fifteen (15) business days after receipt of . notice and demand, the City has not met its obligations hereunder, or has not presented a plan to do so that is acceptable to the Commissioner of Finance, the State may divert payment of funds appropriated by the State to the City in the amount necessary to pay all deficiencies, plus interest, plus all necessary and reasonable expenses in- curred by the State in connection with the default. (f) The City's annual payments are to be credited by the State to the City of St. Paul District Heating Bond Account in the State Bond Fund on or before October 31 in each year until said bonds, and any bonds refunding the same, with interest thereon, have been fully paid and redeemed, and_ until the total amount of such annual payments equals the total amount of principal and interest actually paid on the State bonds, at which time the Cor�nissioner of Finance agrees to cancel and satisfy the loan; and (g) Income received each year from the investment of said annual payments while held in the Bond Account, as computed by the Commissioner of Finance by prorating the interest on the average daily balance in the State's Bond Fund, shall � � be credited against the amount of the payment due by the City in the following year. � ' (h) The State agrees that the City may prepay this design loan at any time provided that such prepayment will include ' all outstanding principal and unpaid and due interest through the date of the prepayment. , , , a7 �'.��� Section 7. The proceeds of the bonds, when received by the City from the State Treasurer, shall be credited to a special Dis- trict Heating Design Account on �he books and records of the City and used only to pay necessary, expenses and costs of District Heat- ing Design Project as provided for in Laws of Minnesota 1981 , Chap- ter 334. Section 8. The funding provided for in this Agreement is � in anticipation of and conditioned upon the sale of State of Minne- sota General Obligation bonds and the loan of the proceeds thereof . to the City of St. Qaul as provided herein. Notwithstanding the ' foregoing, the State may advance funds to the City of St. Paul as funds are available. � Section 9. The parties acknowledge that the proceeds of this Loan Agreement will be the subject of a contract for completion � of design phase activities related to the St. Paul district heating � system. The City acknowledges and recognizes by execution hereof that said contract or any subsequent agreement will not diminish directly or indirectly the City's responsibilities set forth here- under. IN WITNESS WHEREOF, the City of St. Paul has caused this Agreement to be duly executed in its behalf, and the State of Minne- sota has executed this Agreement all as of the date first above wri tten. STATE OF MINNESOTA CITY OF ST. PAUL DEPARTMENT OF FINANCE BY BY ommissioner o inance Mayor ATTORNEY GENERAL, as to form and execution Director, epartment o inance and Management services BY ssistant ttorney eneral Director, Department o ann�ng and Economic Development DEPARTMENT OF ADMINISTRATION Approved as to form by: � BY ommissioner o A ministration S . 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