SF 1261

as introduced - 82nd Legislature (2001 - 2002) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to economic development; directing payment of 
  1.3             a loan for the RiverCentre arena to an economic 
  1.4             development fund for St. Paul; appropriating money; 
  1.5             amending Laws 1998, chapter 404, section 23, 
  1.6             subdivision 6.  
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Laws 1998, chapter 404, section 23, subdivision 
  1.9   6, is amended to read: 
  1.10  Subd. 6.  St. Paul RiverCentre
  1.11  Arena                                                65,000,000
  1.12  This appropriation is from the general 
  1.13  fund to the commissioner of finance for 
  1.14  a loan to the city of St. Paul to 
  1.15  demolish the existing St. Paul 
  1.16  RiverCentre Arena and to design, 
  1.17  construct, furnish, and equip a new 
  1.18  arena.  This appropriation is not 
  1.19  available until the lessee to whom the 
  1.20  city has leased the arena has agreed to 
  1.21  make rental or other payments to the 
  1.22  city under the terms set forth in this 
  1.23  subdivision.  The loan is repayable 
  1.24  solely from and secured by the payments 
  1.25  made to the city by the lessee.  The 
  1.26  loan is not a public debt and the full 
  1.27  faith, credit, and taxing powers of the 
  1.28  city are not pledged for its repayment. 
  1.29  (a) $48,000,000 of the loan must be 
  1.30  repaid to the commissioner, without 
  1.31  interest, within 20 years from the date 
  1.32  of substantial completion of the arena 
  1.33  in accordance with the following 
  1.34  schedule: 
  1.35  (1) no repayments are due in the first 
  1.36  two years from the date of substantial 
  1.37  completion; 
  1.38  (2) in each of the years three to five, 
  2.1   the lessee must pay $1,250,000; 
  2.2   (3) in each of the years six to ten, 
  2.3   the lessee must pay $1,500,000; 
  2.4   (4) in each of the years 11 to 13, the 
  2.5   lessee must pay $2,000,000; 
  2.6   (5) in year 14, the lessee must pay 
  2.7   $3,000,000; 
  2.8   (6) in year 15, the lessee must pay 
  2.9   $4,000,000; and 
  2.10  (7) in each of the years 16 to 20, the 
  2.11  lessee must pay $4,750,000. 
  2.12  (b) The commissioner of finance must 
  2.13  deposit the all repayments in from the 
  2.14  RiverCentre area loan into the state 
  2.15  treasury, and credit them to the youth 
  2.16  activities account, which is hereby 
  2.17  created in the special revenue fund.  
  2.18  Money in the youth activities account 
  2.19  is available for expenditure as 
  2.20  appropriated by law a St. Paul 
  2.21  development account to be managed as a 
  2.22  grants program by the department of 
  2.23  trade and economic development, for the 
  2.24  purpose of redevelopment within the 
  2.25  city of St. Paul. 
  2.26  (c) The loan may not be made until the 
  2.27  commissioner has entered into an 
  2.28  agreement with the city of St. Paul 
  2.29  identifying the rental or other 
  2.30  payments that will be made and 
  2.31  establishing the dates on and the 
  2.32  amounts in which the payments will be 
  2.33  made to the city and by the city to the 
  2.34  commissioner.  The payments may include 
  2.35  operating revenues and additional 
  2.36  payments to be made by the lessee under 
  2.37  agreements to be negotiated between the 
  2.38  commissioner, the city, and the 
  2.39  lessee.  Those agreements may include, 
  2.40  but are not limited to, an agreement 
  2.41  whereby the lessee pledges to provide 
  2.42  each year a letter of credit sufficient 
  2.43  to guarantee the payment of the amount 
  2.44  due for the next succeeding year; an 
  2.45  agreement whereby the lessee agrees to 
  2.46  maintain a net worth, certified each 
  2.47  year by a financial institution or 
  2.48  accounting firm satisfactory to the 
  2.49  commissioner, that is greater than the 
  2.50  balance due under the payment schedule 
  2.51  in paragraph (a); and any other 
  2.52  agreements the commissioner may deem 
  2.53  necessary to ensure that the payments 
  2.54  are made as scheduled. 
  2.55  (d) The agreements must provide that 
  2.56  the failure of the lessee to make a 
  2.57  payment due to the city under the 
  2.58  agreement is an event of default under 
  2.59  the lease between the city and the 
  2.60  lessee and that the state is entitled 
  2.61  to enforce the remedies of the lessor 
  2.62  under the lease in the event of 
  2.63  default.  Those remedies must include, 
  3.1   but need not be limited to, the 
  3.2   obligation of the lessee to pay the 
  3.3   balance due for the remainder of the 
  3.4   payment schedule in the event the 
  3.5   lessee ceases to operate a National 
  3.6   Hockey League team in the arena. 
  3.7   (e) By January 1, 1999, the 
  3.8   commissioner shall report to the chair 
  3.9   of the senate committee on state 
  3.10  government finance and the chair of the 
  3.11  house committee on ways and means the 
  3.12  terms of an agreement between the 
  3.13  lessee and the amateur sports 
  3.14  commission whereby the lessee agrees to 
  3.15  make the facilities of the arena 
  3.16  available to the commission on terms 
  3.17  satisfactory to the commission for 
  3.18  amateur sports activities consistent 
  3.19  with the purposes of Minnesota 
  3.20  Statutes, chapter 240A, each year 
  3.21  during the time the loan is 
  3.22  outstanding.  The amateur sports 
  3.23  commission must negotiate in good faith 
  3.24  and may be required to pay no more than 
  3.25  actual out-of-pocket expenses for the 
  3.26  time it uses the arena.  The agreement 
  3.27  may not become effective before 
  3.28  February 1, 1999.  During any calendar 
  3.29  year after 1999 that an agreement under 
  3.30  this paragraph is not in effect and a 
  3.31  payment is due under the schedule, the 
  3.32  lessee must pay to the commissioner a 
  3.33  penalty of $750,000 for that year.  If 
  3.34  the amateur sports commission has not 
  3.35  negotiated in good faith, no penalty is 
  3.36  due.