EDA Meeting Date: September 23, 2024
To: Members of the Economic Development Authority
From: Ben Martig, City Administrator
David Bennett, Public Works Director
Jake Reilly, Community Development Director
Nate Carlson, Economic Development Coordinator
Title
Consider Resolution Supporting Lease Revenue Bonds - Debt Financing for New Ice Arena.
Body
Action Requested:
Consider a motion to approve Resolution supporting the use of a lease revenue bond for constructing the new ice arena.
Summary Report:
In the State of Minnesota, Economic Development Authorities (EDA) and Housing and Redevelopment Authorities are granted the statutory authority to issue debt in the form of a bond in order to finance construction of any building/real property that has a public purpose.
This tool is known, generally, as a conduit bond and in this specific case the tool is a "lease revenue bond." As described in Minnesota State Statue 469.152 - 469.1651 Ch. 462C, lease revenue bonds are initiated by and issued for the benefit of private or public entities by a City or statutory authority, such as an EDA. The proceeds of the bond are directed to the private/public entity, and the private/public entity repays the principal and interest payments on the bonds. The EDA does not pay any debt service or costs related to the transaction.
In anticipation of using this tool to facilitate City-led building projects that have a public purpose, such as a new ice arena or a new liquor store, City staff and financial consultants, Nick Anhut of Ehlers and Jenny Boulton of Kennedy and Graven, will provide a presentation on the financing mechanism. The presentation will also discuss the relationship between the City and any other public, not-for-profit, and private entities involved in the project, specifically addressing how the new ice arena will be financed. The EDA's role is to be the conduit, only.
The City Council of Northfield, City Council of Dundas, the Northfield Public Sc...
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