HomeMy WebLinkAboutItem 08December 1, 2014
Item No.
RESOLUTION APPROVING A MODIFICATION TO THE TAX INCREMENT FINANCING PLAN
FOR TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO.3
Proposed Action
Staff recommends adoption of the following motion: Move to approve RESOLUTION
APPROVING A MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR TAX
INCREMENT FINANCING(REDEVELOPMENT) DISTRICT NO.3
Following the public hearing... approval of the motion will result in a modification in
the TIF #3 financing plan.
Overview
Tax Increment Financing District 3 in Downtown Lakeville will expire on December 31 of this
year. If the HRA and City Council wish to appropriate the unencumbered funds
(approximately $164,000) to a redevelopment purpose, it needs to approve the proposed
plan changes.
PrimaryIes to Consider
➢ What are authorized uses? The funds can be expended within the Downtown
Redevelopment Area on any purpose authorized by M.S. 469.001, which includes proving a
sufficient supply of adequate, safe, and sanitary dwellings in order to protect the health,
safety, morals, and welfare of the citizens of this state; to clear and redevelop blighted areas;
to perform those duties according to comprehensive plans; to remedy the shortage of
housing for low and moderate income residents, and to redevelop blighted areas, in
situations in which private enterprise would not act without government participation or
subsidies.
Supporting Information
✓ Modification to the Tax Increment
(Redevelopment) District no.3
Felle , Finance Director
Financing Plan for Tax Increment Financing
Financial Impact: $ 164,000Budgeted: N. A. Source: Tax Increment Financing Fund - #3
Related Documents (CIP, ERP, etc.):
Notes:
CITY OF LAKEVILLE
RESOLUTION No.
RESOLUTION APPROVING A MODIFICATION TO THE TAX INCREMENT FINANCING
PLAN FOR TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO.3
WHEREAS, the Housing and Redevelopment Authority in and for the
City of Lakeville (the "Authority") previously established Redevelopment Project No. 1,
pursuant to Minnesota Statutes, Chapter 469, as amended, in an effort to encourage
the development and redevelopment of certain designated areas within the City of
Lakeville (the "City"); and
WHEREAS, the Authority previously established Tax Increment
Financing (Redevelopment) District No. 3 (the 'TIF District"), pursuant to and in
accordance with Minnesota Statutes, Sections 469.174 through 469.1799, as amended
(the "Act"); and
WHEREAS, the Authority is proposing a modification to its Tax
Increment Financing Plan for the TIF District (the "Modification"), in order to increase
the budget of the TIF District, pursuant to and in accordance with the Act; and
WHEREAS, the Board of the Authority, on December 1, 2014, adopted
the Modification, subject to approval by this City Council following a public hearing as
described below, and transmitted the Modification to this City Council for
consideration; and
WHEREAS, members of the Board of County Commissioners of Dakota
County and of the Board of Education of Independent School District No. 194 have
been given an opportunity to meet with the City and the Authority and comment on
the Modification. Pursuant to Minnesota Statutes, Section 469.175, subdivision 3, this
Council, on December 1, 2014, conducted a public hearing on the desirability of
approving the Modification. Notice of the public hearing was duly published as
required by law in the Sun Thisweek, the official newspaper of the City, November 20,
2014. The City and the Authority have not received written comments on the
Modification from the county and the school district after providing the county and
the school district boards with information on the fiscal and economic implications of
the Modification not less than 30 days before the date of the public hearing; and
WHEREAS, in addition to the notice and opportunity described above,
as required by Minnesota Statutes, Section 469.175, subdivision 2a, the City and the
Authority, not less than 30 days before the publication of the notice of public hearing
referred to above, delivered written notice to the members of the Board of County
Commissioners of Dakota County who represent the TIF District. The notice contained
a general description of the boundaries of the TIF District, the proposed development
activities to be undertaken therein, an offer by representatives of the City and the
Authority to meet and discuss the proposed Modification with the county
commissioners and a solicitation of the commissioners' comments with respect to the
TIF District.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
LAKEVILLE, MINNESOTA, AS FOLLOWS:
Section 1. Approval of Modification. On the basis of the Modification
and the information elicited at the public hearing referred to herein, it is hereby found,
determined and declared that:
(a) The TIF District is a "redevelopment district" within the meaning of
Minnesota Statutes, Section 469.174, Subdivision 10.
(b) 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 and, with respect to the TIF District, 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 TIF District permitted by the Modification. Therefore, the use of
tax increment financing from the TIF District is deemed necessary since private
developers could not economically develop the projects without the proposed
subsidy.
(c) The Modification conforms to the general plan for the development
or redevelopment of the City as a whole.
(d) The TIF District affords maximum opportunity, consistent with the
sounds needs of the City as a whole, for the development or redevelopment of
the proposed projects by private enterprise.
(e) Upon review of the Modification, the information elicited at the
public hearing and on the basis of the findings in (a) through (d) above, this
Council hereby approves the Modification.
Section 4. Filing. The City Clerk is hereby authorized and directed to file
the Modification with the Commissioner of Revenue and the Office of the State
Auditor as required by Minnesota Statutes, Section 469.175, subdivision 4a.
2
Approved this 15t day of December, 2014.
CITY OF LAKEVILLE, MINNESOTA
By:
ATTEST:
Charlene Friedges, City Clerk
Matt Little, Mayor
The Housing and Redevelopment Authority in and
for the City of Lakeville, Minnesota
Modification to the Tax Increment Financing Plan
for
Tax Increment Financing (Redevelopment)
District No. 3
Within
Redevelopment Project No.1
and
Draft Dated: November 25, 2014
Public Hearing Scheduled: December 1, 2014
Anticipated Approval Date: December 1, 2014
Prepared by:
SPRINGSTED INCORPORATED
380 Jackson Street, Suite 300
St. Paul, MN 55101-2887
(651) 223-3000
l WW.SPRINGSTED.COM
INTRODUCTION
The purpose of the Modification to the Tax Increment Financing Plan for Tax Increment Financing Redevelopment
District No. 3 is to adjust the total estimated project costs and estimated revenues to reflect the cumulative approved
budget pursuant to the previous modifications of the District, as well as reflect the current activities and financial
status of the district. The sections of the Plan specifically being modified include Section G, I, M, and N and are the
only sections referenced within this plan modification. The Modification is not intended to account for all legislative
changes that have occurred since approval of the District and any subsequent modifications that may have an impact
on the Plan and District.
TABLE OF CONTENTS
TAX INCREMENT FINANCING PLAN FOR
TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO.3
Section Page(s)
G. Estimate of Costs...................................................................................................................1
I. Sources of Revenue..............................................................................................................................................1
M. Estimated Impact on Other Taxing Jurisdictions....................................................................................................2
N. Modifications of the Tax Increment Financing District............................................................................................2
Appendix A Map: Redevelopment Project Area No. 1
AppendixA Map: Tax Increment Financing District No. 3
Housing and Redevelopment Authority in and for the City of Lakeville, Minnesota
TAX INCREMENT FINANCING PLAN FOR
TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO.3
Section G Estimate of Costs
The estimated public costs of the TIF District are listed below. Such costs are eligible for reimbursement from tax
increments of the TIF District.
The Authority reserves the right to administratively adjust the amount of any of the items listed above or to
incorporate additional eligible items, so long as the total estimated public cost is not increased. The estimated cost of
capitalized interest is included in the loan interest payment amount. The Authority reserves the right to spend
available tax increment outside of the TIF District boundaries and within the project area.
Section I Sources of Revenue
Original TIF
Plan (May 4,
1987)
Modification #1
(October 5,
1987)
Modification #2
(January 21,
1997
Modification #3
(February 2,
1998
Modification #4
(December 1,
2014
Land/building
acquisition costs
206,629
350,000
1,506,629
1,597,000
2,047,000
Site improvements/
preparation costs
186,000
90,000
286,000
286,000
0
Utilities
45,000
0
45,000
0
110,000
Parking facilities
0
0
0
0
0
Other public improvements
43,600
0
43,600
0
750,000
Interest payments
191,250
200,000
491,250
2,091,250
2,167,250
Administrative
77,221
80,000
127,221
125,450
125,450
Underwriters Discount
15,300
16,000
45,300
45,300
45,300
Contingency
5,000
245,000
245,000
245,000
Total
765,000
741,000
2,790,000
4,390,000
5,490,000
The Authority reserves the right to administratively adjust the amount of any of the items listed above or to
incorporate additional eligible items, so long as the total estimated public cost is not increased. The estimated cost of
capitalized interest is included in the loan interest payment amount. The Authority reserves the right to spend
available tax increment outside of the TIF District boundaries and within the project area.
Section I Sources of Revenue
The City reserves the right to finance any or all public costs of the TIF District using pay-as-you-go assistance,
internal funding, general obligation or revenue debt, or any other financing mechanism authorized by law. The City
also reserves the right to use other sources of revenue legally applicable to the Project Area to pay for such costs
including, but not limited to, special assessments, utility revenues, federal or state funds, and investment income.
SPRI GSTED Pagel
Original TIF
Plan (May 4,
1987)
Modification #1 Modification #2
(October 5, (January 21,
1987) 199
Modification #3
(February 2,
1998
Modification #4
(December 1,
2014
Tax increment revenues
2,538,250
2,538,250 6,397,250
6,397,250
5,265,000
Interest and investment
earnings
0
0 0
0
25,000
Market value homestead
credit
0
0 0
0
200,000
Loan advanoe/re a ments
0
0 0
0
0
Sales/lease proceeds
0
0 0
0
0
Total
2,538,250
2,538,250 1 6,397,250
6,397,250
5,490,000
The City reserves the right to finance any or all public costs of the TIF District using pay-as-you-go assistance,
internal funding, general obligation or revenue debt, or any other financing mechanism authorized by law. The City
also reserves the right to use other sources of revenue legally applicable to the Project Area to pay for such costs
including, but not limited to, special assessments, utility revenues, federal or state funds, and investment income.
SPRI GSTED Pagel
Housing and Redevelopment Authority in and for the City of Lakeville, Minnesota
Section M Estimated Impact on Other Taxing Jurisdictions
The Authority believes that there will be no adverse impact on other taxing jurisdictions since the developments would
not have occurred without the establishment of the TIF District and the provision of public assistance and the
revenues have already been received pursuant to the authority of the TIF Plan as approved. The TIF District will
decertify as of December 31, 2014, resulting in a positive impact occurring on other taxing jurisdictions when the
development therein becomes part of the general tax base.
Section N Modification of the Tax Increment Financing District
The Authority is modifying the Tax Increment Financing District pursuant to Minnesota Statutes 469.175.
SPRINGSTED Page 2
Appendix A
MAP OF TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO.3
Within Redevelopment Project No.1
Redeuelopreent PMject Area No. i
SPRINGSTED Page 3