469.102 GENERAL OBLIGATION BONDS.
Subdivision 1. Authority; procedure.
An economic development authority may issue
general obligation bonds in the principal amount authorized by two-thirds majority vote of its
city's council. The bonds may be issued in anticipation of income from any source. The bonds
may be issued: (1) to secure funds needed by the authority to pay for acquired property or (2) for
other purposes in sections
. The bonds must be in the amount and form and
bear interest at the rate set by the city council. Except as otherwise provided in sections
, the issuance of the bonds is governed by chapter 475. The authority when issuing the
bonds is a municipal corporation under chapter 475.
Subd. 2. Detail; maturity.
The authority with the consent of its city's council shall set the
date, denominations, place of payment, form, and details of the bonds. The bonds must mature
serially. The first installment is due in not more than three years and the last in not more than
30 years from the date of issuance.
Subd. 3. Signatures; coupons; liability.
The bonds must be signed by the president of the
authority, be attested by its secretary, and be countersigned by its treasurer; the signatures may be
facsimile signatures. The interest coupons if any, must be attached to the bonds. The coupons
must be executed and authenticated by the printed, engrossed, or lithographed facsimile signature
of the authority's president and secretary. The bonds do not impose any personal liability on
a member of the authority.
Subd. 4. Pledge.
The bonds must be secured by the pledge of the full faith, credit, and
resources of the issuing authority's city. The authority may pledge the full faith, credit, and
resources of the city only if the city specifically authorizes the authority to do so. The city council
must first decide whether the issuance of the bonds by the authority is proper in each case and if
so, the amount of bonds to issue. The city council shall give specific consent in an ordinance to the
pledge of the city's full faith, credit, and resources. The authority shall pay the principal amount
of the bonds and the interest on it from taxes levied under this section to make the payment
or from authority income from any source.
Subd. 5. Tax levy.
An authority that issues bonds under this section, shall, before issuing
them, levy a tax for each year on the taxable property in the authority's city. The tax must be for at
least five percent more than the amount required to pay the principal and interest on the bonds
as the principal and interest mature. The tax must be levied annually until the principal and
interest are paid in full. After the bonds have been delivered to the purchasers, the tax must not be
repealed until the debt is paid. After the bonds are issued, the authority need not take any more
action to authorize extending, assessing, and collecting the tax. On or before September 15, the
authority's secretary shall send a certified copy of the levy to the county auditor, together with full
information on the bonds for which the tax is levied. The county auditor shall extend and assess
the levied tax annually until the principal and interest are paid in full. The authority shall transfer
the surplus from the excess levy in this section to a sinking fund after the principal and interest for
which the tax was levied and collected is paid. The authority may direct its secretary to send a
certificate to the county auditor before September 15 in a year. The certificate must state how
much available income, including the amount in the sinking fund, the authority will use to pay
principal or interest or both on each specified issue of the authority's bonds. The auditor shall then
reduce the bond levy for that year by that amount. The authority shall then set aside the certified
amount and may not use it for any purpose except to pay the principal and interest on the bonds.
The taxes in this section shall be collected and sent to the authority by the county treasurer as
provided in chapter 276. The taxes must be used only to pay the bonds when due.
Subd. 6. Authorized securities.
Bonds legally issued under this chapter are authorized
securities under section
. A savings bank, trust company, or insurance company may invest
in them. A public or municipal corporation may invest its sinking funds in them. The bonds may
be pledged by a bank or trust company as security for the deposit of public money in place of
a surety bond.
The authority's bonds are instrumentalities of a public governmental agency.
History: 1987 c 291 s 103; 1994 c 416 art 1 s 49; 1995 c 256 s 9; 2002 c 390 s 8