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Home My WebLink About00-030 - ADMIN Resolution - City Council - 2000/03/20RESOLUTION NO. 00-030 RESOLUTION ESTABLISHING THE MILL CITY TAX INCREMENT FINANCING DISTRICT WITHIN REDEVELOPMENT PROJECT NO. 1 AND ADOPTING THE TAX INCREMENT FINANCING PLAN THEREFOR. BE IT RESOLVED by the City Council (the "Council") of the City of St Louis Park, Minnesota (the "City"), as follows Section 1 Recitals 1 01 The City has heretofore established Redevelopment Project No 1 and adopted the Redevelopment Plan therefor It has been proposed that the City establish the Mill City Tax Increment Financing District ("the Mill City Tax Increment Financing District") within Redevelopment Project No 1 and adopt the Tax Increment Financing Plan therefor ( the "Plan"), all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469 090 through 469 1081 and 469 174 through 469 179, all inclusive, as amended, (the "Act") all as reflected in the Plan, and presented for the Council's consideration 1 02 The Council has investigated the facts relating to the Plan and has caused the Plan to be prepared 1 03 The City has performed all actions required by law to be performed prior to the adoption and approval of the proposed Plan, including, but not limited to, notification of Hennepin County and School District No 283 having taxing jurisdiction over the property to be included in the Mill City Tax Increment Financing District, notice of a potential redevelopment district to the local county commissioner, a review of and written comment on the Plan by the City Planning Commission, and the holding of a public hearing upon published notice as required by law Section 2 Findings for the Adoption and Approval of the Plan 2 01 The Council hereby finds that the Plan, is intended and, in the judgment of this Council, the effect of such actions will be, to provide an impetus for redevelopment in the public purpose and accomplish certain objectives as specified in the Plan, which is hereby incorporated herein Section 3 Findings for the Establishment of the Mill City Tax Increment Financing District 3 01 The Council hereby finds that the Mill City Tax Increment Financing District is in the public interest and is a "redevelopment district" under Minnesota Statutes, Section 469 174, subd 10 (a)(1) 3 02 The Council further finds that the proposed redevelopment would not occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the Mill City Tax Increment Financing District permitted by the Tax Increment Financing Plan, that the Plan conforms to the general plan for the development or redevelopment of the City as a whole, and that the Plan will afford maximum opportunity consistent with the sound needs of the City as a whole, for the development or redevelopment of the Mill City Tax Increment Financing District by private enterprise Resolution No 00-030 -2- 3 03 The City elects to make a qualifying local contribution in accordance with Minnesota Statutes, Section 273 1399, subd 6(d), in order to qualify the Mill City Tax Increment Financing District for exemption from state aid losses set forth in Section 273 1399 3 04 The Council further finds, declares and determines that the City made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit A 3 05 The City of St Louis Park elects to calculate fiscal disparities for the Mill City Tax Increment Financing District in accordance with Minnesota Statutes, Section 469 177, subdivision 3, clause b, which means the fiscal disparities contribution will be taken from within the Mill City Tax Increment Financing District Section 4 Public Purpose 4 01 The adoption of the Plan conforms in all respects to the requirements of the Act and will help fulfill a need to develop an area of the City which is already built up, to provide employment opportunities, to improve the tax base and to improve the general economy of the State and thereby serves a public purpose Section 5 Approval and Adoption of the Plan 5 01 The Plan, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, is hereby approved, ratified, established, and adopted and shall be placed on file in the office of the Economic Development Director 5 02 The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plan and to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose 5 03 The Auditor of Hennepin County is requested to certify the original net tax capacity of the Mill City Tax Increment Financing District, as described in the Plan, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased, and the City of St Louis Park is authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify, together with a list of all properties within the Mill City Tax Increment Financing District, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution 5 04 The Economic Development Director is further authorized and directed to file a copy of the Plan with the Commissioner of Revenue f Reviee ed for Administration opted y e ity Co ncil Marc 20, 2000 Attest 10‘...-1......--- 54yLE M7 le a EXHIBIT A RESOLUTION #00-030 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for the Mill City Tax Increment Financing District as required pursuant to M S , Section 469 175, Subd. 3 are as follows 1. Finding that the Mill City Tax Increment Financing District is a redevelopment district as defined in MS , Section 469 174, Subd. 10(a) (1). The Mill City Tax Increment Financing District consists of three parcels, with plans to redevelop the area for residential purposes At least 70 percent of the area in the parcels in the Mill City Tax Increment Financing Distnct are occupied by buildings, streets, utilities, or other improvements and more than 50 percent of the buildings in the Mill City Tax Increment Financing District, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance (See Appendix F of the TIF Plan) 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the Mill City Tax Increment Financing District permitted by the Plan The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future This finding is supported by the fact that the redevelopment proposed in this plan meets the City's objectives for redevelopment Due to the high cost of redevelopment on the parcels currently occupied by substandard buildings and the cost of remediation of contaminated soils and ground water, the incompatible land uses at close proximity, and the cost of financing the proposed improvements, this project is feasible only through assistance, in part, from tax increment financing The Department of Trade and Economic Development and the Met Council, has supported the need for public assistance to the property in the district through grants of approximately $1,600,000 for environmental costs The developer was asked for and provided a pro -forma as justification that the developer would not have gone forward without tax increment assistance (See attachment in Appendix F of the TIF Plan) The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the Plan: The City supported this finding on the grounds that the cost of site and public improvements and utilities add to the total redevelopment cost A number of developers have looked at this site and have avoided redeveloping it due to the nsk associated with the environmental contamination Even with DTED and Met Council grant assistance, the project would provide less than adequate returns with out TIF assistance Therefore, the City reasonably determines that no other redevelopment of any kind is anticipated on this site without substantially similar assistance being provided to the development Resolution No 00-030 Exhibit A -2- A comparative analysis of estimated market values both with and without establishment of the Mill City Tax Increment Financing District and the use of tax increments has been performed as described above If all development which is proposed to be assisted with tax increment were to occur in the Mill City Tax Increment Financing District, the total increase in market value would be up to $13,944,500 The present value of tax increments from the Mill City Tax Increment Financing District is estimated to be $4,261,947 It is the Council's finding that no development with a market value of greater than $9,682,553 would occur without tax increment assistance in this district within 25 years For the reasons described above, the Council does not expect that any development would occur without Tax Increment Financing assistance (See Cashflow in Appendix D of the TIF Plan) 3. Finding that the Tax Increment Financing Plan for the Mill City Tax Increment Financing District conforms to the general plan for the development or redevelopment of the municipality as a whole. The Plan was reviewed by the Planning Commission on March 1, 2000 The Planning Commission found that the Plan conforms to the Comprehensive Plan of the City 4. Finding that the Tax Increment Financing Plan for the Mill City Tax Increment Financing District will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Redevelopment Project No 1 by private enterprise. The project to be assisted by the Mill City Tax Increment Financing District will result in the removal of substandard properties, increased tax base of the State and add a high quality development to the City