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CIiAPTER 15 Loans must be for a purpose the EDA is authorized to carry out under the law. An authorized purpose must deal with or contribute to economic or industrial development. EDAs have the ability to use pooled bond reserving. In most development programs, each bond issue is independent of any other bond issue with a separate service or sinking fund account. EDAs, however, may create a single common bond reserve fund. Under this arrangement, each project's revenues go into a common fund, which in turn pays the bondholders on all projects. Through this pooling mechanism, the security of each project's bond increases and borrowing costs decrease as long as the pool has the necessary volume and diversity of cash flow. 3. Other EDA powers Minn. star. § a~~.lol, sicbds 1, EDAs can acquire property and facilities but cannot issue debt without an '-• election. The city must authorize the issuance of debt in the resolution 201 ti Minn. Lat~~s ~.n. ss0, aIt- °;, creating the EDA. Also, EDAs can create economic development districts 5 amending~9iizr. Star. ~. a~y.t01, ~ubd.1. but the districts must be contiguous. Current law eliminates the requirements °° °° that economic development districts established by EDAs meet the "blight xouse Bill summary 1-cl'. 3~2~ Research Department (May 16, test" under tax increment financing law for redevelopment districts. EDAs zolo). may exercise powers under the housing and redevelopment authority (HRA) Minn. star. ~ aF~a.loz. law (if a particular EDA enabling resolution includes HRA power) to create a redevelopment project, housing development, or housing project under which a restrictive blight test does not apply. These projects can be used for similar purposes to those of an economic development district under the EDA law. D. Port authorities Minn. stet. YY .~~v.tl~F- 4~n.f~~s. The state Legislature authorizes city creation of port authorities. A port Mim7. s`at''' ~ti9.053. authority is a separate political entity with the right to sue and be sued in its own name and is generally organized to increase commerce in a city. Unlike EDAs and HRAs, a port authority may issue general obligation bonds without holding an election. Minn. star. 3 ~~9.tlst>. Nlinn. Cities establish a port authority by passing an enabling resolution. It may star. § 469.os1. have from three to seven commissioners (two of whom must be on the city council) appointed by the mayor and approved by the city council, unless a different number or procedure is set out in the enabling law. State law governs commissioner pay, vacancies, duties, and port authority by-laws. iblilnl-star. § 46y.051> 5«bd. 2. A port authority shall annually elect a president or chair, vice-president or vice-chair, treasurer, secretary, and assistant treasurer. A commissioner may not serve as president or chair and vice-president or vice-chair at the same time. The other offices may be held by one commissioner. The offices of secretary and assistant treasurer need not be held by a commissioner. 15:10 LEAGUE OF MINNESOTA CITIES This chapter last revised 12/2010