HF 859

This appropriation is from the general fund
to the commissioner of finance for a loan to
the city of St. Paul to demolish the existing
St. Paul RiverCentre Arena and to design,
construct, furnish, and equip a new arena.
This appropriation is not available until the
lessee to whom the city has leased the arena
has agreed to make rental or other payments
to the city under the terms set forth in this
subdivision. The loan is repayable solely
from and secured by the payments made
to the city by the lessee. The loan is not a
public debt and the full faith, credit, and
taxing powers of the city are not pledged for
its repayment.

(a) deleted text begin $48,000,000deleted text end new text begin $5,250,000 new text end of the loan
must be repaid to the commissioner, without
interest, within deleted text begin 20deleted text end new text begin sixnew text end years from the date
of substantial completion of the arena in
accordance with the following schedule:

(1) no repayments are due in the first two
years from the date of substantial completion;

(2) in each of the years three to five, the
lessee must pay $1,250,000; new text begin and
new text end

(3) in deleted text begin each of the yearsdeleted text end new text begin year new text end six deleted text begin to tendeleted text end , the
lessee must pay $1,500,000deleted text begin ;deleted text end new text begin .
new text end

deleted text begin (4) in each of the years 11 to 13, the lessee
must pay $2,000,000;
deleted text end

deleted text begin (5) in year 14, the lessee must pay
$3,000,000;
deleted text end

deleted text begin (6) in year 15, the lessee must pay
$4,000,000; and
deleted text end

deleted text begin (7) in each of the years 16 to 20, the lessee
must pay $4,750,000.
deleted text end

new text begin After the payment for year six has been
made, no more of the loan need be repaid to
the commissioner by the city of St. Paul and
the balance due on the loan is forgiven.
new text end

(b) The commissioner must deposit the
repayments in the state treasury and credit
them to the general fund.

(c) The loan may not be made until the
commissioner has entered into an agreement
with the city of St. Paul identifying the rental
or other payments that will be made and
establishing the dates on and the amounts
in which the payments will be made to the
city and by the city to the commissioner. The
payments may include operating revenues
and additional payments to be made by the
lessee under agreements to be negotiated
between the commissioner, the city, and the
lessee. Those agreements may include, but
are not limited to, an agreement whereby the
lessee pledges to provide each year a letter
of credit sufficient to guarantee the payment
of the amount due for the next succeeding
year; an agreement whereby the lessee
agrees to maintain a net worth, certified each
year by a financial institution or accounting
firm satisfactory to the commissioner, that
is greater than the balance due under the
payment schedule in paragraph (a); and any
other agreements the commissioner may
deem necessary to ensure that the payments
are made as scheduled.

(d) The agreements must provide that the
failure of the lessee to make a payment due
to the city under the agreement is an event
of default under the lease between the city
and the lessee and that the state is entitled to
enforce the remedies of the lessor under the
lease in the event of default. Those remedies
must include, but need not be limited to, the
obligation of the lessee to pay the balance due
for the remainder of the payment schedule
in the event the lessee ceases to operate a
National Hockey League team in the arena.

(e) By January 1, 1999, the commissioner
shall report to the chair of the senate
committee on state government finance
and the chair of the house committee on
ways and means the terms of an agreement
between the lessee and the amateur sports
commission whereby the lessee agrees to
make the facilities of the arena available to
the commission on terms satisfactory to the
commission for amateur sports activities
consistent with the purposes of Minnesota
Statutes, chapter 240A, each year during the
time the loan is outstanding. The amateur
sports commission must negotiate in good
faith and may be required to pay no more
than actual out-of-pocket expenses for the
time it uses the arena. The agreement may
not become effective before February 1,
1999. During any calendar year after 1999
that an agreement under this paragraph is
not in effect and a payment is due under
the schedule, the lessee must pay to the
commissioner a penalty of $750,000 for that
year. If the amateur sports commission has
not negotiated in good faith, no penalty is
due.