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.^~/ <br />City of <br />Elk -~.-, <br />River <br />REQUEST FO R ACTIO N <br />To Item Number <br />Ci Council 5.2. <br />Agenda Section Meeting Date Prepared by <br />Administration July 7, 2008 Catherine Mehelich, Director of <br /> Economic Develo ment <br />Item Description Reviewed by <br />Request for Industrial Revenue Bond for Metal Craft Machine & Tim Simon, Finance Director <br />Engineering, Inc. Project -Public Hearing & Resolution Reviewed by <br />Action Requested <br />Staff recommends the Council's action of the following items: <br />1) Open a Public Hearing on the issuance of Industrial Revenue Bonds for the proposed Metal Craft <br />project, and then continue the public hearing to July 21, 2008. <br />2) Consider approval of the attached Resolution granting prelitnuiary approval of the project. <br />Resolution No. 08-_, A Resolution Reciting a Proposal for an Industrial Development Project and <br />Indicating Preliminary Intent to Assist the Financing of the Project Pursuant to Minnesota Municipal <br />Industrial Development Act and (Metal Craft Project) <br />Background/Discussion <br />Staff recently received an application request from local manufacturer, Metal Craft Machine & <br />Engineering, Inc. for an Industrial Revenue Bond. Metal Craft is seeking authorization for the City of <br />Elk River to issue a 30-year tax exempt industrial development revenue bond in an amount up to <br />$5-million. These funds will be used as proceeds for the construction of the company's manufacturing <br />facility and related equipment and fiiriushings located at 13760 Business Center Drive in Elk River. The <br />City's issuance of this industrial development revenue bond will enable the company to obtain financing <br />at fixed and reduced rates. <br />The applicant is requesting that the Council consider approval of the attached resolution which indicates <br />a preliminary approval of the request. The applicant recently indicated additional entities to be identified <br />as separate borrowers on the building and equipment. Therefore, it is necessary for the City to continue <br />the public hearing to Monday, July 21, 2008 in order to formally identify and consider the additional <br />entities as part of a final resolution approving the project and issuance of the bonds. <br />Financial Impact <br />There will be no impact to the City since this request is for a revenue bond (conduit financing) with the <br />City not having t0 pledge any considerations towards debt payment. In addition, Metal Craft has paid an <br />C:\Users\cmehelich\AppData\Local\Microsoft\Windows\Temporazy Internet Files\OLK4635\Request Council Action metalcraft.doc <br />