7.0. SR 01-27-1997ITEM 7.
'ty of
MEMORANDUM
·
lver
Mayor & City Council
FROM:
DATE:
Paul T. Steinman, Director of Economic
Development
January 21, 1997
SUBJECT: Public Hearing - TIF District No. 16
Issue
A public hearing is scheduled to be held before the City Council on Monday,
January 27, 1997, to consider public review and comment on the creation of
Tax Increment Financing District No. 16 in the City of Elk River.
Background
In June, 1996, the HRA undertook the purchase of three parcels of property
at the corner of King Avenue and Main Street in downtown Elk River. The
overall plan includes purchase of the properties, demolition, and resale of the
site to developer Dennis Chuba.
In order to facilitate the purchase, demolition, and other costs associated
with this project, the Elk River Housing and Redevelopment Authority has
completed the Plan for Tax Increment District No. 16 as attached for Council
approval.
The anticipated project schedule is as follows:
January 27, 1997
HRA and City Council approve modifications
to the Development Program for
Development District No. I and Plan for
Tax Increment District No. 16
· Jan/Feb 1997
HRA approves demolition bids
· Jan/Feb 1997
HRA enters into formal development
agreement with Dennis Chuba
· July 1, 1997
TIF District No. 16 certified to county and
state
13065 Orono Parkway · P.O. Box 490 · Elk River, MN 55330 · (612) 441-7420 · Fax: (612) 441-7425
· July, 1997
· July/Aug 1997
· December 1997
Site is sold by HRA to developer Dennis
Chuba
Chuba begins construction project
Construction project completed.
Recommendation
Staff recommends the City Council approve Resolution 97- modifying the
Development Program for Development District No. I and approving the
Plans for Tax Increment Financing District No. 16.
Attachments
Resolution 97-
Modifications to the Development Program for Development District No. 1
and the Tax Increment Financing Plan for Tax Increment Financing
District No. 16
shrdoc\council\tif16.doc
RESOLUTION 97 -__
A RESOLUTION FOR THE CITY OF ELK RIVER, MINNESOTA
A RESOLUTION FOR THE CITY OF ELK RIVER RELATING TO
MODIFICATION OF THE DEVELOPMENT PROGRAM FOR
DEVELOPMENT DISTRICT NO. 1
AND THE TAX INCREMENT FINANCING PLAN FOR
TAX INCREMENT FINANCING DISTRICT NO. 16
BE IT RESOLVED by the City Council (the Council) of the City of Elk
River, Minnesota (the City), as follows:
Section 1. - Recitals.
1.01. It has been proposed and adopted by the Housing and
Redevelopment Authority for the City of Elk River, Minnesota (the HRA) that
the HRA establish Tax Increment Financing District No. 16 within
Development District No. 1 pursuant to and in accordance with Minnesota
Statutes.
1.02. The HRA has caused to be prepared, and the Council has
investigated the facts with respect thereto, a proposed Tax Increment
Financing Plan for Tax Increment Financing District No. 16 (the Plan).
1.03. The HRA and the City have performed all actions required by
law to be performed prior to the establishment of Tax Increment Financing
District No. 16 and the adoption of the Plan relating thereto.
1.04. The Council hereby determines that it is necessary and in the
best interest of the City at this time to establish Tax Increment Financing
District No. 16 and the adoption of the Plan relating thereto.
Section 2. - Findings for the Establishment of Tax Increment
Financing District No. 16.
2.01. The Council hereby finds, determines, and declares that the
establishment of Tax Increment Financing District No. 16 located within
Development District No. 1 is intended and, in the judgment of this Council,
its effects will be, to provide an impetus for commercial development,
increase employment, and otherwise promote certain public purposes and
accomplish certain objectives as specified in the Plan for Tax Increment
Financing District No. 16.
2.02. The Council further finds, determines, and declares that Tax
Increment Financing District No. 16 qualifies as a Redevelopment District
pursuant to Minnesota Statutes, Section 469.174, Subdivision 10.
2.03. The Council further finds, determines, and declares that the
proposed development, in the opinion of the Council, would not occur solely
through private investment within the reasonably foreseeable future and,
therefore, the use of Tax Increment Financing is deemed necessary.
2.04. The Council further finds, determines, and declares that the
proposed Plan for Tax Increment Financing District No. 16 conforms to the
Comprehensive Plan of the City.
2.05. The Council further finds, determines, and declares that the
proposed Plan for Tax Increment Financing District No. 16 will afford
maximum opportunity, consistent with the sound needs of the City as a
whole, for the development or redevelopment of areas within Development
District No. I by private enterprise.
2.06. The Council determines and declares that Tax Increment
Financing District No. 16 located within Development District No. 1 is
hereby established.
Section 3. - Adoption of the Plan.
3.01. The Plan presented to the Council on this date, is hereby
approved and adopted and shall be placed on file in the office of the City
Clerk.
Section 4. - Implementation of the Plan.
The City Administrator and Assistant City Administrator are authorized and
directed to proceed with the implementation of this Plan, and for this
purpose, to negotiate, draft, prepare, and present to the Council for its
consideration, all future plans, resolutions, documents, and contracts.
Adopted by the City Council of the City of Elk River, Minnesota, this 27th
day of January, 1997.
ATTEST:
Henry A. Duitsman, Mayor
Sandra A. Thackeray, City Clerk
MODIFICATIONS
To the
Development Program
For
Development District No. 1
and the
TAX INCREMENT FINANCING PLAN
(Redevelopment Plan)
for
Tax Increment Financing District No. 16
(A Redevelopment District)
Housing and Redevelopment Authority in and for the City of Elk River
Sherbume County
City of Elk River, Minnesota
Prepared: October 21, 1996
Revised: October 21, 1996
Adopted:
Prepared by:
City of Elk River
13065 Orono Parkway
Elk River MinnesOta 55330
(612) 441-7420
With final review by:
Doherty Rumble & Butler, PA
3500 Fifth Street Towers
150 South Fifth Street
Minneapolis, Minnesota 55402-4235
(612) 340-5584
TABLE OF CONTENTS
SECTION I.
SECTION II.
Section A.
Section B.
Section C.
Section D.
Section E.
Section F.
Section G.
Section H.
Section I.
Section J.
Section K.
Section L.
Section M.
Section N.
Section O.
Section P.
Section Q.
Section R.
Section S.
Section T.
Section U.
Section V.
Section W.
Section X.
Section Y.
Section Z.
Section AA.
Section AB.
Section AC.
EXHIBIT A
EXHIBIT B
EXHIBIT C
EXHIBIT D
TAX INCREMENT FINANCING PLAN FOR
TAX INCREMENT FINANCING DISTRICT NO. 16
MODIFIED DEVELOPMENT PROGRAM FOR DEVELOPMENT DISTRICT ........ I- 1
TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING
DISTRICT NO. 16
Statutory Authority .............................................................................................. II- 1
Statement of Objectives ....................................................................................... II- 1
Development Program Overview ......................................................................... II-2
Description of Property in District No. 16 ........................................................... II-2
Classification of the Tax Increment Financing District ....................................... II-2
Property To Be Acquired ..................................................................................... II-3
Estimate of Costs
Estimated Amount of Loan/Bonded Indebtedness ................ II-4
Original Tax Capacity .......................................................................................... II-5
Amount of Captured Tax Capacity ...................................................................... II-5
Duration of the District ........................................................................................ I1-6
Estimated Impact on Other Taxing Jurisdictions ................................................. II-6
Modifications of the Tax Increment Financing District ....................................... 1I-7
Administrative Expenses ..................................................................................... II-7
Duration of Tax Increment Financing DistriCts ................................................... II-7
Limitation on Qualification of Property in Tax Increment District
Not Subject to Improvement ................................................................................ II-8
Limitation on the Use of Tax Increment .............................................................. II-8
Notification of Prior Planned Improvements .......................... II-8
Requirement for Agreements with the Developer ............................................... I1-9
Assessment Agreements ...................................................................................... II-9
Administration of District and Maintenance of the Tax Increment Account ..... II-10
Financial Reporting Requirements
Municipal Approval .................................................................... II- 10
County Road Costs ........................................................................................... II- 12
Reduction in State Tax Increment Financing Aid .............................................. II-13
Economic Development and Job Creation ......................................................... II-13
Summary ............................................................................................................ II- 13
Boundary. Map of Tax Increment Financing District No. 16 ............................... A-1
Cashflow Analysis and Base Value Analysis ...................................................... B-1
Developer Letter of Intent and Site Concept
Minnesota Business Assistance Form ....................................................... C- 1
SECTION I.
MODIFIED DEVELOPMENT PROGRAM
FOR DEVELOPMENT DISTRICT NO. I
MODIFICATION TO SECTION I:
Current plans for this downtown commercial redevelopment project are to build a 14,000 square
foot commercial facility (TIF District No. 16). The project is proposed to include a maximum
.~550,000 of Tax Increment Financing.
Development Program for Development District No. 1 ..................................................................................................................................................................... Page I-I
SECTION II.
TAX INCREMENT FINANCING PLAN FOR
TAX INCREMENT FINANCING DISTRICT NO. 16
A. STATUTORY AUTHORITY
Within the City of Elk River (the "City") there exist areas where public involvement is necessary to
cause development or redevelopment to occur. To this end, the City Council established the Elk
River Housing and Redevelopment Authority (the "Authority").
The City faces various existing land use problems that require corrective action by the City or
Authority before development by private enterprise becomes financially feasible or desirable. The
Authority and City are authorized to establish a tax increment district pursuant to Minnesota
Statutes, Section 469.174 to 469.179, inclusive, as amended, to assist in financing public costs
related to this project. Tax increments are derived only from the increased amount of taxes which
are paid on a parcel of property after the construction of a new structure on the parcel. Tax
increment districts encompass the parcels from which tax increments are paid for a period of time.
Below is the Tax Increment Financing Plan (the "Plan") for Tax Increment Financing District No. 16
("District No. 16"). Other relevant information is contained in the Development Program for
Development District No. 1, originally adopted on April 1, 1985 and subsequently modified. A
modification of the Development Program is contemplated in the Tax Increment Plan.
Development District No. 1 includes the area proposed for District No. 16. The Authority or the
City reserves the right to approve all or a portion of the property proposed to be included in District
No. 16 on the date of the first public hearing, January 27, 1997.
B. STATEMENT OF OBIECTIVES
District No. 16 consists of 3 parcels of land and adjacent and internal rights-of-way.
The current plans for the new development on the site include a 14,000 square foot commercial
facility.
District No. 16 is expected to achieve many of the objectives set forth in the Development
Program in regard to land use. These objectives include:
Provide impetus for commercial, residential, and industrial development by
constructing the public facilities necessary to make such development possible;
Increase employment opportunities in the city by encouraging additional
commercial and industrial development.
Provide adequately serviced commercial and industrial areas of the city to
accommodate desirable users;
Remedy deficiencies in the existing water and sanitary sewer systems, which
deficiencies have restricted development in areas of the city planned and designated
for commercial, residential, and industrial uses;
Tax Increment Financing District No. 16
Page ll-I
5. Preserve and enhance the tax base of the city;
Preserve and enhance the quality of life of the city; and,
Provide maximum opportunity, consistent with the needs of the city for
development by private enterprise.
Data on file regarding the qualifications of the redevelopment tax increment financing district.
C. DEVELOPMENT PROGRAM OVERVIEW
Property to be Acquired - Property located entirely within District No. 16 is owned
by the Authority and is further described in Subsection F of this Plan.
Relocation ~ Complete relocation services are available pursuant to Minnesota
Statutes, Chapter 117 and other relevant state and federal laws.
Upon approval of the developer's plan relating to the project and completion of the
necessary legal requirements, the Authority may sell to the developer selected
properties it currently owns within District No. 16.
o
The City or the Authority may perform or provide for some or all necessary
relocation, removal of substandard structures, site preparation, demolition,
construction of required utilities and public parking/streets work within District No.
16.
5. District No. 16 contains property zoned central commercial. All development in the area
will conform to applicable state and local codes and ordinances.
D. DESCRIPTION OF PROPERTY IN DISTRICT NO. 16
District No. 16 encompasses the parcels as identified below in addition to all adjacent (King
Avenue and Main Street) and interior right-of-ways:
75~405-0160
75-405-0150
75-405-0140
305 & 307 King Avenue
317 King Avenue
812 Main Street
The City or the Authority reserves a right to approve all or a portion of the area of the parcels listed
as being designated for District No. 16.
See the map in Exhibit A for further infOrmation on the location of District No. 16.
E. CLASSIFICATION OF THE TAX INCREMENT FINANCING DISTRICT
The City and the Authority, in determining the need to create a tax increment financing district in
accordance with Minnesota Statutes, Section 469.174 to 469.1 79, as amended, inclusive, find that
District No. 16 to be established is a redevelopment district pursuant to Minnesota Statutes, Section
469.1 74, Subdivision 10 as defined below:
Tax Increment Financing District No. 16 Page II-2
(a)
"Redevelopment district" means a type of tax increment financing district consisting of
a project, or portions of a project, within which the authority finds by resolution that
one of the following conditions, reasonably distributed throughout the district, exists:
(I) parcels consisting of 70 percent of the area in the district are occupied by
buildings, streets, utilities, or other improvements and more than 50 percent
of the buildings, not including outbuildings, are structurally substandard to a
degree requiring substantial renovation or clearance; or
(2) The property consists of vacant, unused, underused, inappropriately used, or
infrequently used railyards, rail storage facilities or excessive or vacated
railroad rights-of-way.
For purposes of this subdivision, "structurally substandard" shall mean containing
defects in structural elements or a combination of deficiencies in essential utilities and
facilities, light and ventilation, fire protection including adequate egress, layout and
condition of interior partitions, or similar factors, which defects or deficiencies are of
sufficient total significance to justify substantial renovation or clearance.
A building is not structurally substandard if it is in compliance with the building
code applicable to new buildings or could be modified to satisfy the building
code at a cost of less than 15 percent of the cost of constructing a new structure
of the same square footage and type on the site. The municipality may find that a
building is not disqualified as structurally substandard under the preceding
sentence on the basis of reasonably available evidence, such as the size, type, and
age of the building, the average cost of plumbing, electrical, or structural repairs
or other similar reliable evidence. If the evidence supports a reasonable
conclusion that the building is not disqualified as structurally substandard, the
municipality may make such a determination without an interior inspection or an
independent, expert appraisal of the cost of repair and rehabilitation of the
building...
For purposes of this subdivision, a parcel is not occupied by buildings, streets, utilities
or other improvements until 15 percent of the area of the parcel contains
improvements.
The parcels have been investigated by City and Authority staff and consultants and District No. 16
has been found to meet all requirements of a redevelopment district.
1. District No. 16 consists of 3 parcels.
2. An inventory of the parcels shows that at least 70 percent of the parcels are occupied as
defined in the Act.
3. An inspection of the buildings located within District No. 16 finds that at least 100 percent
of the buildings are structurally substandard as defined in the Act.
F. PROPERTY TO BE ACQUIRED
The Authority has acquired all parcels within District No. 16.
Tax Increment Financing District No. 16
Page II-3
G..ESTIMATE OF COSTS
The estimate of public costs associated with District No. 16 are outlined in the following line item
budget:
Estimate of Public Costs
25 yr., 6%
Semi-annual income stream = $22,769 (see Exhibit B)
Qualified Costs:
Principal Interest
Land Acquisition
Demolition
Public Improvements
Other Development Costs
Administration
$410,000 $330,678 $740,678
$ 30,000 $ 24,196 $ 54,196
$ 50,000 $ 40,327 $ 90,327
$ 10,000 $ 8,065 $ 18,065
$ 50,000 $ 40,327 $ 90,327
Total: $550,000 $443,593 $993,593
The City or Authority reserve the right to modify actual line item dollar amounts at any time
throughout the duration of the District, as long as it does not change the Total as indicated above.
Capitalized interest and other interest payments on tax increment bonds and obligations are also
considered to be public costs in addition to the above referenced estimate of public costs. Interest
payments and capitalized interest will be determined at the time of issuance of the bonds and
obligations and are dependent on interest rates in effect at such time. In addition to above
mentioned costs, administration costs to cover city staff and overhead and various consulting fees
in an amount not to exceed 10% of total tax increment will be funded with tax increments from
District No. 16.
Any funds to be expended outside the boundaries of District No. 16, but within the boundaries of
Development District No. 1, will be less than 25 percent of total tax increment generated by
District No. 16, including administrative costs. Subject to that limitation, and the limitations as
described in Section R., the tax increment from District No. 16 may be used to pay for public costs
outlined in the Development Program for Development District No. 1 (whether or not such
expenditures exceed the total budget for this plan identified above).
H. .ESTIMATED AMOUNT OF LOAN/BONDED INDEBTEDNESS
The City or Authority have the ability to issue a revenue bond, general obligation bond, or other
type of obligation in one or more series for a maximum amount of $500,000 to finance any or all of
the Total Estimated Public Costs authorized to be paid under Section G of this Plan.
Tax Increment Financing District No. 16
Page 1I-4
I. SOURCES OF REVENUE
The partial source of revenue to be used to finance public costs associated with the public
development projects and objectives as stated in Development District No~ 1 is tax increment
generated as a result of the taxation of the land and improvements in District No. 16. Tax
increment financing refers to a funding technique that utilizes increases in valuation and the
property taxes attributable to new development to finance, or assist in the financing of, public
development costs. Additional sources of revenue may include but are not limited to investment
income and land sales proceeds. This does not preclude the City, the Authority, or the developer
from using other funds, at its discretion, to pay such costs.
J. ORIGINAL TAX CAPACITY
Pursuant to Minnesota Statutes Section 469.174, Subdivision 7 and Section 469.177, Subdivision 1,
the Original Net Tax Capacity (OTC) for the District No. 16 is based on the value placed on th~.
property by the assessor in 1997 for taxes payable 1998. The tax capacity as certified is estimated to
be 0 for taxes payable in 1998.
The original local tax rate for the purpose of the projecting cashflow for District No. 16 will be the
tax rate for taxes payable in 1996 of 1.03497. The certified original local tax rate for District No.
16 will be the tax rate for taxes payable in 1998.
Each year, the Sherburne County Auditors Office will measure the amount of increase or decrease
in the total tax capacity of District No. 16 to calculate the tax increment payable to the City and the
Authority. In any year in which there is an increase in total tax capacity in the tax increment
financing district above the annual percentage of annual increase, a tax increment will be payable.
In any year in which the total tax capacity in District No. 16 declines below the original tax
capacity, no additional valuation will be captured and no tax increment will be payable.
The County Auditor shall certify in each year after the date the OTC was certified, the amount the
OTC has increased or decreased as a result of:
2.
3.
4.
5.
change in tax exempt status of property;
reduction or enlargement of the geographic boundaries of the district;
change due to stipulations, adjustments, negotiated or court-ordered abatements;
change in the use of the property and classification; or
change in state law governing class rates.
K. AMOUNT OF CAPTURED TAX CAPACITY
Pursuant to Minnesota Statutes, Section 469.174 Subdivision 4 and Minnesota Statutes, Section
469.1 77, Subdivision 2, the estimated Captured Net Tax Capacity (CTC) of District No. 16, upon
completion of all phases of the project, will annually approximate 44,000, based on an estimated
market value of $1,000,000. The City requests 100 percent of the available increase in tax capacity
for repayment of debt and current expenditures.
Tax Incretnent Financing District No. 16 Page II-5
The original tax capacity and project tax capacity are estimated at current market values and class
rates to be the total amount when all development is in place and uses of the property have
changed.
Estimated Project Tax Capacity
less Original Tax Capacity
Estimated Captured Tax Capacity
44,000
0
44,000
L. DURATION OF THE DISTRICT
Pursuant to Minnesota Statutes, Section 469.175, Subdivision 1, the duration of District No. 16
must be indicated within the Plan. The duration of District No. 16 will be 25 years from payment
of the first tax increment expected in 1999. Thus, it is estimated that District No. 16, including any
modifications of the Plan for subsequent phases or other changes, would terminate at the end of the
year 2023. The City and the Authority reserve the right to decertify District No. 16 prior to the
legally required date.
M. ESTIMATED IMPACT ON OTHER TAXING JURISDICTIONS
The estimated impact on other taxing jurisdictions assumes construction would have occurred
without the creation of District No. 16. After careful consideration and analysis, the Authority has
determined that construction would not occur without the creation of District 16. If the
construction is a result of tax increment financing, the impact is $0 to other entities.
Notwithstanding the fact that the fiscal impact on the other taxing jurisdictions is $0 due to the fact
that the construction would not have occurred without the assistance of the city, the following
estimated impact of District No. 16 would be as follows if the "but for" test was not met:
IMPACT ON TAX BASE
ENTITY
ENTITY'S
TOTAL N ET
TAX CAPACITY
CAPTURED
TAX CAPACITY
% OF CAPTURED
TAX CAPACITY
TO ENTITY TOTAL
Sherburne County
City of Elk River
School District No. 728
57,579,856
10,694,856
22,502,787
44,000
44,000
44,000
0.076%
0.411%
0.196%
ENTITY
Sherburne County
City of Elk River
School District No. 728
Other
TOTAL
IMPACT ON TAX RATES
CURRENT
TAX RATE
CAPTURED
TAX CAPACITY
.23574
.24033
.54530
.01360
44,000
44,000
44,000
44,000
1.03497
POTENTIAL
TAXES
10,373
10,575
23,993
598
45,539
Tax Increment Financing District No. 16 Page II-6
The estimates listed above display captured tax capacity when all construction is completed. The
tax rates and tax capacities are the payable 1996 figures for all jurisdictions. District No. 16 will be
certified under rates for tax year payable 1997.
N. MODIFICATIONS OF THE TAX INCREMENT FINANCING DISTRICT
In accordance with Minnesota Statutes, Section 469.175, Subdivision 4, any reduction or
enlargement of the geographic area of the project or tax increment financing district, increase in
amount of bonded indebtedness to be incurred, including a determination to capitalize interest on
debt if that determination was not a part of the original plan, or to increase or decrease the amount
of interest on the debt to be capitalized, increase in the portion of the captured tax capacity to be
retained by the City or Authority, increase in total estimated tax increment expenditures or
designation of additional property to be acquired by the City or Authority shall be approved upon
the notice and after the discussion, public hearing and findings required for approval of the original
plan. The geographic area of a tax increment financing district may be reduced, but shall not be
enlarged after five years following the date of certification of the original tax capacity by the county
auditor or by approximately July 2002.
Modifications to the District No. 16, in the form of a budget modification or an expansion of the
boundaries, will be recorded in this Plan.
O. LIMITATION ON ADMINISTRATIVE EXPENSES
In accordance with Minnesota Statutes, Section 469.174, Subdivision 14 and Minnesota Statutes,
Section 469.176, Subdivision 3, administrative expenses means all expenditures of an authority
other than amounts paid for the purchase of land or amounts paid to contractors or others providing
materials and services, including architectural and engineering services, directly connected with the
physical development of the real property in the district, relocation benefits paid to or services
provided for persons residing or businesses located in the district or amounts used to pay interest
on, fund a reserve for, or sell at a discount bonds issued pursuant to Section 469.178.
Administrative expenses include amounts paid for services provided by bond counsel, fiscal
consultants, and planning or economic development consultants. No tax increment shall be used
to pay any administrative expenses for a project which exceed ten percent of the total tax increment
expenditures authorized by the tax increment financing plan or the total tax increment expenditures
for the project, whichever is less.
Pursuant to Minnesota Statutes, Section 469.176, Subdivision 4h, tax increments may be used to
pay for the county's actual administrative expenses incurred in connection with District No. 16.
The county may require payment of those expenses by February 15 of the year following the year
the expenses were incurred.
P. DURATION OF TAX INCREMENT FINANCING DISTRICTS
Pursuant to Minnesota Statutes, Section 469.176, Subdivision 1, "no tax increment shall be paid to
an authority three years from the date of certification by the County Auditor unless within the
three-year period (1) bonds have been issued pursuant to Section 469.178, or in aid of a project
pursuant to any other law, except revenue bonds issued pursuant to Chapter 469.152 to 469.165,
prior to the effective date of the Act; or (2) the authority has acquired property within the district; or
Tax Increment Financing District No. 16 Page II-7
(3) the authority has constructed or caused to be constructed public improvements within the
district... "The City or Authority must therefore issue bonds, or acquire property, or construct or
cause public improvements in District No. 16 by approximately July, 2000.
Q. LI/vllTATION ON QUALIFICATION OF PROPERTY IN TAX INCREMENT DISTRICT NOT
SUBJECT TO IMPROVEMENT
Pursuant to Minnesota Statutes, Section 469.176, Subdivision 6,
if, after four years from the date of certification of the original tax capacity of the tax increment
financing district pursuant to Minnesota Statutes, Section 469. 177, no demolition, rehabilitation
or renovation of property or other site preparation, including qualified improvement of a street
adjacent to a parcel but not installation of utility service including sewer or water systems, has
been commenced on a parcel located within a tax increment financing district by the authority
or by the owner of the parcel in accordance with the tax increment financing plan, no additional
tax increment may be taken from that parcel and the original tax capacity of that parcel shall be
excluded from the original tax capacity of the tax increment financing district. If the authority or
the owner of the parcel subsequently commences demolition, rehabilitation or renovation or
other site preparation on that parcel including improvement of a street adjacent to that parcel, in
accordance with the tax increment financing plan, the authority shall certify to the county
auditor in the annual disclosure report that the activity has commenced. The county auditor
shall certify the tax capacity thereof as most recently certified by the commissioner of revenue
and add it to the original tax capacity of the tax increment financing district. The county auditor
must enforce the provisions of this subdivision... For purposes of this subdivision, qualified
improvements are limited to (l) construction or opening of a new street, (2) relocation of a
street, and (3) substantial reconstruction or rebuilding of an existing street.
R. LIMITATION ON THE USE OF TAX INCREMENT
Pursuant to Minnesota Statues, 469.176, Subd. 4, at least 90 percent of the revenues derived from tax
increments from a redevelopment district must be used to finance the cost of correcting conditions that
allow designation of redevelopment districts under section 469.174, Subdivision 10. These costs include
acquiring properties containing structurally substandard buildings or improvements, acquiring adjacent
parcels necessary to provide a site of sufficient size to permit development, demolition of structures,
clearing of the land and installation of utilities, roads, sidewalks, and parking facilities for the site.
The revenues shall be used to finance or otherwise pay public redevelopment and housing development
costs pursuant to the HRA Act. These revenues shall not be used to circumvent any levy limit law. No
revenues derived from tax increment shall be used for the construction or renovation of a municipally
owned building used primarily and regularly for conducting the business of the municipality; this
provision shall not prohibit the use of revenues derived from tax increments for tile construction or
renovation of a parking structure, a commons area used as a public park or a facility used for social,
recreational or conference purposes and not primarily for conducting tile business of the municipality..
For tax increment financing districts for which certification was requested after April 30, 1990, pursuant
to Minnesota Statutes, Section 469.1763, Subdivisions I and 2, an amount equal to at least 75 percent of
tile revenue derived from tax increments from the district's parcels must be expended on activities in the
district.
S. NOTIFICATION OF PRIOR PLANNED IMPROVEMENTS
Pursuant to Minnesota Statutes, Section 469.177, Subdivision 4, the City and the Authority have
Tax Increment Financing District No. 16 Page II-8
reviewed the area to be included in District No. 16 and found no properties for which building permits
have been issued during the 18 months ilnlnediately preceding approval of the Plan bv the City. If a
building permit had been issued within the 18 month period preceding approval of the l~lan by the City,
the county auditors shall increase the original tax capacity of the district by the valuation of the
improvements for which the building permit was issued.
T. EXCESS TAX INCREMENTS
Pursuant to Minnesota Statutes, Section 469.176, Subdivision 2, in any year in which the tax increment
exceeds the amount necessary to pay the costs authorized by the tax increment plan, including the amount
necessary to cancel any tax levy as provided in Minnesota Statutes, Section 475.61, Subdivision 3, the
authority shall use the excess amount to do any of the following:
prepay the outstanding bonds;
discharge the pledge of tax increment therefore;
pay into an escrow account dedicated to the payment of such bond; or
return the excess to the County Auditor for redistribution to the
jurisdictions in proportion to their tax capacity rate.
respective taxing
The Authority may also modify this Plan to authorize additional costs.
U. REQUIREMENT FOR AGREEMENTS WITH THE DEVELOPER
The City or Authority will review any Developer's proposal to determine its conformance with the
Development Program and with applicable municipal ordinances and codes. To facilitate this effort, the
following documents may be requested for review and approval: site plan, construction, mechanical, and
electrical system drawings, landscaping plan, grading and storm drainage plan, signage system plan, and
any other drawings or narrative deemed necessary by the City or Authority to demonstrate the
conformance of the development with city plans and ordinances. Land acquired by the City or Authority
may be subject to a Contract for Sale upon disposition to the Developer. The general requirements to be
imposed upon the developer by the Contract for Sale are:
To redevelop the land purchased in accordance with this plan.
To commence and complete the building of improvements on the land within a
reasonable period of time as determined by the City or Authority.
Not to resell the land before improvements are made without the prior consent of the
City or Authority.
Not to discriminate on the basis of race, color, sex, creed or national origin on the sale,
lease, transfer or occupancy of the land purchased from the City or Authority.
The requirements to be imposed upon the Developer and the City's or Authority's exact participation in
the project will be negotiated as part of the Redevelopment Agreement between the City or the Authority
and the Developer.
V. ASSESSMENT AGREEMENTS
Pursuant to Minnesota Statutes, Section 469.177, Subdivision 8, the City or Authority may enter into an
Tax Increment Financing District No. 16
Page 11-9
agreement in recordable form with the owner of property within the tax increment financing district
which establishes a minimum market value of the land and improvements for the duration of the tax
increment district. The assessment agreelnent shall be presented to the county assessor who shall review
tile plans and specifications for the improvements constructed, review the market value assigned to the
land upon which the improvements have been or will be constructed and, so long as the minimum market
value contained in the assessment agreement appear, in the judgment of the assessor, to be a reasonable
estimate, the assessor may certify the minimum market value agreement.
W. ADMINISTRATION OF DISTRICT AND MAINTENANCE OF THE TAX INCREMENI'
ACCOUNT
Administration of District No. 16 will be handled by the Executive Director of the Authority. The tax
increment received as a result of increases in the tax capacity of District No. 16 will be maintained in a
special fund separate from all other municipal funds and expended only upon sanctioned municipal
activities identified in the tax increment financing plan.
X. FINANCIAL REPORTING REQUIREMENTS
Pursuant to Minnesota Statutes, Section 469.175, Subdivisions 5, 6, and 6(a); the City or Authority must
file an annual disclosure report for all tax increment financing districts with the State Auditor, the county
board, county auditor, and school board.
Pursuant to Section 469.175, Subd. 5, of the Tax Increment Financing Act, the City or Authority must
file an annual disclosure report for the Tax Increment Financing District. The report shall be filed with
the State Auditor, the county board, county auditor, and school board on or before July 1 of each year.
The report to be filed by the City or Authority shall include the following information:
5.
6.
7.
8.
the amount and source of revenue in the tax increment account;
the amount and purpose of expenditures from the account;
the amount of any pledge of revenues, including principal and interest, on any
outstanding bond indebtedness;
the original net tax capacity of the Tax Increment Financing District;
the captured net tax capacity retained by the City;
the captured net tax capacity shared with other taxing districts;
the tax increment received;
any additional information necessary to demonstrate compliance with the tax increment
financing plan.
Section 469.175, Subd. 5, of the Tax Increment Financing Act also provides that an annual statement
showing the tax increment received and expended in that year, the original net tax capacity, captured net
tax capacity, amount of outstanding bonded indebtedness, the amount of the district's increments paid to
other governmental bodies, the amount paid for administrative costs, the sum of increments paid, directly
or indirectly, for activities and improvements located outside of the district, and any additional
information the City or Authority deems necessary shall be published in a newspaper of general
circulation in the City.
Pursuant to Minnesota Statutes, Section 469.175, Subd. 6, of the Tax Increment Financing Act, the City
or Authority must annually submit to the State Auditor, on or before July 1, a financial report which
Tax Increment Financing District No. 16
Page Il-10
shall:
provide for full disclosure of the sources and uses of the public funds in the district;
permit comparison and reconciliation with the City's accounts and financial reports;
permit auditing of the funds expended on behalf of the tax increment district, including a
single district that is part of a multi district project or that is fundcd in part or whole
through the use of a development account funded with tax increments from other districts
or with other public money; and
be consistent with generally accepted accounting principles.
The financial report must also include the following:
the original net tax capacity of the district;
the captured net tax capacity of the district, including the amount of any captured net tax
capacity shared with other taxing districts;
for the reporting period and for the duration of the district, the amount budgeted under
the tax increment financing plan, and the actual amount expended for, at least, the
following categories:
a. acquisition of land and buildings through condemnation or purchase;
b. site improvements or preparation costs;
c. installation of public utilities, parking facilities, streets, roads, sidewalks,
or other similar public improvements;
d. administrative costs, including the allocated cost of the authority;
e. public park facilities, facilities for social, recreational, or conference
purposes, or other similar public improvements;
for properties sold to developers, the total cost of the property to the authority and the
price paid by developers;
the amount of increments rebated or paid to developers or property owners for privately
financed improvements or other qualifying costs.
Pursuant to Minnesota Statutes, Section 469.175, subdivision 6a, the City or Authority must also
annually report to the State Auditor before or on July 1 of each year the following amounts for the entire
City:
the total principal amount of nondefeased tax increment financing bonds that are
outstanding at the end of the previous calendar year; and
the total annual amount of principal and interest payments that are due for the current
calendar year on (i) general obligation tax increment financing bonds and (ii) other tax
increment financing bonds.
and for each tax increment financing district within the City:
the type of tax increment financing district;
the date on which the district is required to be decertified;
the amount of any payments and the value of in-kind benefits, such as physical
improvements and the use of building space, that are financed with revenues derived
from increments and are provided to another governmental unit (other than the
municipality) during the preceding calendar year;
Tax Increment Financing District No. 16 Page ll-I 1
o
the tax increment revenues for taxes payable in the current calendar year;
whether the tax increment financing plan or other governing document permits increment
revenues to be expended outside of the tax increment financing district;
any additional information that the State Auditor may require.
Copies of this report must also be provided to the county and school district boards.
Y. MUNICIPAL APPROVAL
Pursuant to Minnesota Statutes, Section 469.175, Subdivision 3, before or at the time of approval of the
tax increment financing plan, the municipality shall make the following findings and shall set forth in
writing the reasons and supporting facts for each determination.
Finding tha? the Tax Increment Financing District No. 16 is a redevelopment district as defined
in Minnesota Statutes, Section 469.175, Subd. 10.
District No. 16 consists of 3 parcels of property. The District qualifies as a redevelopment
district as defined in Minnesota Statutes, section 469.174, subd. 10.
Finding that the proposed development, in the opinion of the City Council and the Authority,
would not occur solely through private investment within the reasonably foreseeable future and
that the increased market value of the site that could reasonable 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 district permitted by the plan.
Due to the high cost of redevelopment on parcels currently occupied by substandard buildings,
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.
Finding that the Tax Increment Financing Plan conforms to the general plan for the development
or redevelopment of the municipality as a whole.
The site is appropriately zoned. The Tax Increment Financing Plan has been reviewed by the
Planning Commission and been found to conform to the general development plan of the City.
Finding that the Tax Increment Financing Plan for Tax Increment Financing District No. 16 will
afford maximum opportunity, consistent with the sound needs of the City az a whole, for the
development of Development District No. I by private enterprise.
The establishment of Tax Increment Financing District No. 16 will result in increased
employment for the City and will eliminate a blighting influence in the downtown area.
Z. COUNTY ROAD COSTS
Pursuant to Minnesota Statutes, Section 469.175, Subdivision la, the county board may require the
authority to pay for all or part of the cost of county road improvements if the proposed development to be
Tax Increment Financing District No. 16 Page Il-12
assisted by tax increment will, in the judgment of the county, substantially increase the use of county
roads requiring construction of road improvements or other road costs and if the road improvements are
not scheduled within the next five years under a capital improvement plan or other county plan.
The improvements outlined in the Plan serve as notice to tile county that the development of the
commercial facility will be assisted with tax increment. In the opinion of the City, the Authority, and
consultants, the proposed development will have little or no impact upon county roads. If the county
elects to use increments to improve county roads, it must notify the City within thirty days of receipt of
this plan.
AA. REDUCTION IN STATE TAX INCREMENT FINANCING AID
Pursuant to Minnesota Statues, Section 273.1399, for tax increment financing districts for which
certification was requested after April 30, 1990, a municipality incurs a reduction in state tax increment
financing aid (RISTIFA) applied to the municipality's Local Government Aids (LGA) first and,
Homestead and Agricultural Credit Aids (HACA) second, in an amount equal to a formula based upon
the equalized qualifying captured tax capacity (QCTC) of the tax increment financing district.
Pursuant to Minnesota Statutes, Section 273.1399, Subdivision 6, for tax increment financing districts
certified after June 30, 1994, the City may choose an option to the LGA-HACA penalty. A tax increment
financing district is exempt if the City elects at the time of approving the tax increment financing plan to
make a qualifying local contribution. To qualify for the exemption in each year, the City must make a
qualifying local contribution to the project of a certain percentage. The local contribution for a
redevelopment district is 5 percent. The maximum local contribution for all districts in the City is
limited to two percent of the City's net tax capacity.
The amount of the local contribution must be made out of unrestricted money of tile authority or
municipality, such as the general fund, a property tax levy, or a federal or a state grand-in-aid which may
be spent for general government purposes. The local contribution may not be made, directly or
indirectly, with tax increments or developer payments. The local contribution must be used to pay
project costs and cannot be used for general government purposes. The Authority elects to make the
annual local contribution to the project to exempt itself from the LGA-HACA penalty.
AB. ECONOMIC DEVELOPMENT AND JOB CREATION
To the extent applicable, the City agrees to comply with Minnesota Statues, Section 116J.991, which
states that a business receiving state or local government assistance for economic development or job
growth purposes, including tax increment financing, must create a net increase in jobs and meet wage
level goals in Minnesota within two years of receiving assistance (See Appendix D).
AC. SUMMARY
The City of Elk River is establishing Tax Increment Financing District No. 16 to preserve and enhance
the tax base, to redevelop substandard areas, and increase employment of the City. The Tax Increment
Financing Plan for Tax Increment Financing District No. 16 was prepared by the City of Elk River,
13065 Orono Parkway, Elk River, Minnesota 55330, telephone (612) 441-7420.
Tax Increment Financing District No. 16 Page 11-13
EXHIBIT A
BoundaD' Map of Tax Increment Financing District No. 16
N. 1/2 S.W. 1/4 SEC. 34 T. 33 N. R. 26 W.
I . I ' ' · ? , .
4TH STRE£T N.W.
//~' ~ NqLLAGE
23
Tax Increment Financing District No. 16
Page A-I
EXHIBIT B
Cashflow Analysis and Base Value Analysis
Tax Increment Financing District No. 16 Page B-I
TIF DISTRICT NO. 16
CASH FLOW ASSUMPTIONS
Pay-As-You-Go Interest Rate 6.00%
Tax Extension Rate 1.03497
nflat on Rate 0.00%
Pay 96
VALUE/RATE/CAPACITY
Value Rate Capacity
Value Information 0 4.40% 0 Pay 96
PROJECT INFORMATION
Type of Total Taxes Per Total Tax Market Date
Use Sq. Ft. Sq. Ft. Taxes Capacity Value Payable
Commercial 14,000 $3.25 45,539 44,000 1,000,000 1999
Totals 14,000 45,539 44,000 1,000,000
BUT FOR ANALYSIS
Current Market Value - Estimate 410,000
New Market Value - Estimate 1,000,000
Difference 590,000
Present Value of Tax Increment 490,640
Difference 99,360
Value Likely to Occur Without TIF 0
Difference 99,360
IMPACT ANALYSIS
TAX CAPACITIES
SHERBURNE 57,579,856 44,000 0.076%
ELK RIVER 10,694,856 44,000 0.411%
DISTRICT 728 22,502,787 44,000 0.196%
TAX RATES
SHERBURNE 0.235740 44,000 10,373
ELK RIVER 0.240330 44,000 10,575
DISTRICT 728 0.545300 44,000 23,993
OTHER 0.013600 44,000 598
TOTALS 1.034970 45,539
Cashflow analysis prepared by CITY OF ELK RIVER 12~20/96
TIF DISTRICT NO. 16
lPERIOD BEGINNING Base Project
Tax Tax
Yrs. Mth. Yr. Capacity Capacity
07-01 1996 0
12-01 1996 0
0.0 07-01 1997 0
0.0 12-01 1997 0
0.0 07-01 1998 0
0.0 12-01 1998 0
0.0 07-01 1999 0
0.5 12-01 1999 0
1.0 07-01 2000 0
1.5 12-01 2000 0
2.0 07-01 2001 0
2.5 12-01 2001 0
3.0 07-01 2002 0
3.5 12-01 2002 0
4.0 07-01 2003 0
4.5 12-01 2003 0
5.0 07-01 2004 0
5.5 12-01 2004 0
6.0 07-01 2005 0
6.5 12-01 2005 0
7.0 07-01 2006 0
7.5 12-01 2006 0
8.0 07-01 2007 0
8.5 12-01 2007 0
9.0 07-01 2008 0
9.5 12-01 2008 0
10.0 07-01 2009 0
10.5 12-01 2009 0
11.0 07-01 2010 0
11.5 12-01 2010 0
12.0 07-O1 2011 0
12.5 12-01 2011 0
13.0 07-01 2012 0
13.5 12-01 2012 0
14.0 07-01 2013 0
12-01 2013 0
07-01 2014 0
155 12-01 2014 0
16.0 07-01 2015 0
16.5 12-01 2015 0
17.0 07-01 2016 0
17.5 12-01 2016 0
18.0 07-01 2017 0
18.5 12-01 2017 0
19.0 07-01 2018 0
19.5 12-01 2018 0
20.0 07-01 2019 0
20.5 12-01 2019 0
21.0 07-01 2020 0
21.5 12-01 2020 0
22.0 07-01 2021 0
22.5 12-01 2021 0
23.0 07-01 2022 0
23.5 12-01 2022 0
24.0 07-01 2023 0
24.5 12-01 2023 0
CASH FLOW ANALYSIS
Captured Inflation Semi-Annual Admin, Local Match Total Increment
Tax Rate Gross Tax at at Minus Admin
Capacity 0.00% Increment 10.00% 5.00% Plus Local Match
0 0 0 0 0 0 0
0 0 0 0 0 0 0
0 0 0 0 0 0 0
0 0 0 0 0 0 0
0 0 0 0 0 0 0
0 0 0 0 0 0 0
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44.000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 O 22,769 (2,277) 1,138 21,631
44,000 44.000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44 ,O00 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
44,000 44,000 0 22,769 (2,277) 1,138 21,631
PERIOD ENDING
Yrs. Mth. Yr.
0.0 12-01 1996
0,0 07-01 1997
0.0 12-01 1997
0.0 07-01 1998
0.0 12-01 1998
0.0 07-01 1999
0.5 12-01 1999
1.0 07-01 2000
1.5 12-01 2O00
2.0 07-01 2001
2.5 12-01 2001
3.0 07-01 2OO2
3.5 12-01 2OO2
4.0 07-01 200,'
4.5 12-01 2003
5.0 07-01 2004
5.5 12-01 2004
6.0 07-01 2005
6.5 12-01 2005
7.0 07-01 2006
7.5 12-01 2005
8~0 07-01 2007
8.5 12-01 2007
9.0 07-01 2008
9.5 12-01 2008
10.0 07-01 2009
10.5 12-01 2009
11.0 07-01 2010
11.5 12-01 2010
12.0 O7-01 2011
12.5 12-01 2011
13.0 07-01 2012
13.5 12-01 2012
14.0 07-01 2013
14.5 12-01 2013
15.0 07-01 2014
15.5 12-01 2014
16,0 07-01 2015
16.5 12-01 2015
17.0 07-01 2016
17.5 12-01 2016
18.0 07-01 2017
18.5 12-01 2017
19.0 07-01 2018
19.5 12-01 2018
20.0 07-01 2019
20.5 12-01 2019
21.0 07-01 2020
21.5 12-01 2020
22.0 07-01 2021
22.5 12-01 2021
23.0 07-01 2022
23.5 12-01 2022
24.0 07-01 2023
24.5 12-01 2023
25.0 07-01 2024
Totals 1,138,467 (113,847) 56,923 1,081,544
Total Net Present Value 490,640 (49,064) 24,532 466,108
Cashflow analysis prepared by CITY OF ELK RIVEP 12/20/96
TIF DISTRICT NO. 16 PAYMENT ANALYSIS
PERIOD BEGINNING Schectuled Payment Payment Local Match Local Match Local Match PERIOD ENDING
Payment To HRA To HRA at Owecl by
Mth. Yr. Date 10% Aclmin Dev. Costs 5.00% HRA Yrs. Mth. Yr.
07-01 1996 0 0 0 0.0 12-01 1996
,,.,~ 12-01 1996 0 0 0 0.0 07-01 1997
0.0 07-01 1997 0 0 0 0.0 12-01 1997
0.0 12-01 1997 0 0 0 0.0 07-01 1998
0.0 07-01 1998 0 0 0 0.0 12-01 1998
0.0 12-01 1998 0 0 0 0.0 07-01 1999
0.0 07-01 1999 07-1 2,277 20,492 1,138 1,138 0.5 12-01 1999
0.5 12-01 1999 12-1 2,277 20,492 1,138 1,138 1~0 07-01 2000
1.0 07-O1 2000 07-1 2,277 20,492 1,138 1,138 1.5 12-01 2000
1.5 12-01 2000 12-1 2,277 20,492 1,138 1,138 2.0 07-01 2001
2.0 07-01 2001 07-1 2,277 20,492 1,138 1,138 2.5 12-01 2001
2.5 12-01 2001 12-1 2,277 20,492 1,138 1,138 3.0 07-01 2002
3,0 07-01 2002 07-1 2,277 20,492 1,138 1,138 3.5 12-01 2002
3.5 12-01 2002 12-1 2,277 20,492 1,138 1,138 4.0 07-01 2003
4.0 07-01 2003 07-1 2,277 20,492 1,138 1,138 4.5 12-01 2003
4.5 12-01 2003 12-1 2,277 20,492 1,138 1,138 5.0 07-01 2004
5.0 07-01 2004 07-1 2,277 20,492 1,138 1,138 5.5 12-01 2004
5.5 12-01 2004 12-1 2,277 20,492 1,138 1,138 6.0 07-01 2005
6.0 07-01 2005 07-1 2,277 20,492 1,138 1,138 6.5 12-01 2005
6.5 12-01 2005 12-1 2,277 20,492 1,138 1,138 7.0 07-01 2006
7.0 07-01 2006 07-1 2,277 20,492 1,138 1,138 7.5 12-01 2006
7.5 12-01 2006 12-1 2,277 20,492 1,138 1,138 8.0 07-01 2007
8.0 07-01 2007 07-1 2,277 20,492 1,138 1,138 8.5 12-01 2007
8.5 12-01 2007 12-1 2,277 20,492 1,138 1,138 9.0 07-01 2008
9.0 07-01 2008 07-1 2,277 20,492 1,138 1,138 9.5 12-01 23,08
9.5 12-01 2008 12-1 2,277 20,492 1,138 1,138 10.0 07-01 2009
10.0 07-01 2009 07-1 2,277 20,492 1,138 1,138 10.5 12-01 2009
10.5 12-01 2009 12-1 2,277 20,492 1,138 1,138 11.0 07-01 2010
11.0 07-01 2010 07-1 2,277 20,492 1,138 1,138 11.5 12-01 2010
11.5 12-01 2010 12-1 2,277 20,492 1,138 1,138 12,0 07-01 2011
12.0 07-01 2011 07-1 2,277 20,492 1,138 1,138 12.5 12-01 2011
12.5 12-01 2011 12-1 2,277 20,492 1,138 1,138 13.0 07-01 2012
13.0 07-01 2012 07-1 2,277 20,492 1,138 1,138 13.5 12-01 2012
13.5 12-01 2012 12-1 2,277 20,492 1,138 1,138 14.0 07-01 2013
~' ~ 07-01 2013 07-1 2,277 20,492 1,138 1,138 14.5 12-01 2013
12-01 2013 12-1 2,277 20,492 1,138 1,138 15.0 07-01 2014
'~.., 07-01 2014 07-1 2,277 20,492 1,138 1,138 15.5 12-01 2014
15.5 12-01 2014 12-1 2,277 20,492 1,138 1,138 16.0 07-01 2015
16.0 07-01 2015 07-1 2,277 20,492 1,138 1,138 16.5 12-01 2015
16.5 12-01 2015 12-1 2,277 20,492 1,138 1,138 17.0 07-01 2016
17.0 07-01 2016 07-1 2,277 20,492 1,138 1,138 17.5 12-01 2016
17.5 12-01 2016 12-1 2,277 20,492 1,138 1,138 18.0 07-01 2017
18.0 07-01 2017 07-1 2,277 20,492 1,138 1,138 18.5 12-01 2017
18.5 12-01 2017 12-1 2,277 20,492 1,138 1,138 19.0 07-01 2018
19.0 07-01 2018 07-1 2,277 20,492 1,138 1,138 19.5 12-01 2018
19.5 12-01 2018 12-1 2,277 20,492 1,138 1,138 20.0 O7-01 2019
20.0 07-01 2019 07-1 2,277 20,492 1,138 1,138 20.5 12-01 2019
20.5 12-01 2019 12-1 2,277 20,492 1,138 1,138 21.0 07-01 2020
21.0 07-01 2020 07-1 2,277 20,492 1,138 1,138 21.5 12-01 2020
21.5 12-01 2020 12-1 2,277 20,492 1,138 1,138 22.0 07-01 2021
22.0 07-01 2021 07-1 2,277 20,492 1,138 1,138 22.5 12-01 2021
22.5 12-01 2021 12-1 2,277 20.492 1,138 1,138 23.0 07-01 2022
23.0 07-01 2022 07-1 2,277 20,492 1,138 1,138 23.5 12-01 2022
23.5 12-01 2022 12-1 2,277 20,492 1,138 1,138 24.0 07-O1 2023
24.0 07-01 2023 07-1 2,277 20,492 1,138 1,138 24.5 12-O1 2023
24.5 12-01 2023 12-1 2.277 20,492 1,138 1,138 25.0 07-01 2024
Tot.Is 113,847 1,024,620 56,923
Total Net Present Value 49,064 441,576 24,532
Cashflow analysis prepared by CITY OF ELK RIVER 12/20/96
TIF DISTRICT NO. 16 AMORTIZATION SCHEDULE
PERIOD BEGINNING
Yrs. Mth. Yr.
' ". 07-01 1996
12-01 1996
~.d 07-01 1997
0.0 12-01 1997
0.0 07-01 1998
0.0 12-01 1998
0.0 07-01 1999
0.5 12-01 1999
1.0 07-01 2000
1.5 12-01 2000
2.0 07-01 2001
2.5 12-01 2001
3.0 07-01 2002
3.5 12-01 2002
4.0 07-01 2003
4.5 12-01 2003
5.0 07-01 2004
5.5 12-01 2004
6.0 07-01 2005
6.5 12-01 2005
7.0 07-01 2006
7.5 12-01 2006
8.0 07-01 2007
8.5 12-01 2007
9.0 07-01 2008
9.5 12-01 2008
10.0 07-01 2009
10.5 12-01 2009
11.0 07-01 2010
11.5 12-01 2010
12.0 07-01 2011
12.5 12-01 2011
13.0 07-01 2012
13.5 12-01 2012
14.0 07-01 2013
~' ~ 12-01 2013
07-01 2014
.~ 12-01 2014
16.0 07-01 2015
16.5 12-01 2015
17.0 07-01 2016
17.5 12-01 2016
18.0 07-01 2017
18.5 12-01 2017
19.0 07-01 2018
19.5 12-01 2018
20.0 07-01 2019
20.5 12-01 2019
21.0 07-01 2020
21.5 12-01 2020
22.0 07-01 2021
22.5 12-01 2021
23.0 07-01 2022
23.5 12-01 2022
24.0 07-01 2023
24.5 12-01 2023
Principal
Interest
Semi-Annual Accrued Loan
P & I Net Interest Balance
Revenue Outstanding
0 0 0 0
0 0 0 0
0 0 0 0
0 0 0 0 13,200
0 0 0 0 15,396
0 0 0 0 15,858
4,159 16,334 20,492 20,492 0
4,284 16,209 20,492 20,492 0
4,412 16 080 20,492 20,492 0
4,544 15,948 20,492 20,492 0
4,681 15,812 20,492 20,492 0
4,821 15,671 20,492 20,492 0
4,966 15,527 20,492 20,492 0
5,115 15,378 20,492 20,492 0
5,268 15,224 20,492 20,492 0
5,426 15,066 20,492 20,492 0
5,589 14,903 20,492 20,492 0
5,757 14,736 20,492 20,492 0
5,929 14,563 20,492 20,492 0
6,107 14,385 20,492 20,492 0
6,291 14,202 20,492 20,492 0
6,479 14,013 20,492 20,492 0
6,674 13,819 20,492 20,492 0
6,874 13,619 20,492 20,492 0
7,080 13,412 20,492 20,492 0
7,292 13,200 20,492 20,492 0
7,511 12,981 20,492 20,492 0
7,737 12,756 20,492 20,492 0
7,969 12,524 20,492 20,492 0
8,208 12,285 20,492 20,492 0
8,454 12,038 20,492 20,492 0
8,708 11,785 20,492 20,492 0
8,969 11,524 20,492 20,492 0
9,238 11,255 20.492 20,492 0
9,515 10,977 20,492 20,492 0
9,800 10,692 20,492 20,492 0
10,094 10,398 20,492 20,492 0
10,397 10,095 20,492 20,492 0
10,709 9,783 20,492 20,492 0
11,031 9.462 20,492 20,492 0
11,361 9,131 20,492 20,492 0
11,702 8,790 20,492 20,492 0
12,053 8,439 20,492 20,492 0
12,415 8,077 20,492 20,492 0
12,787 7,705 20,492 20,492 0
13,171 7,321 20,492 20,492 0
13,556 6,926 20,492 20,492 0
13,973 6,519 20,492 20,492 0
14,392 6,100 20,492 20,492 0
14,824 5,668 20,492 20,492 0
15,269 5,224 20,492 20,492 0
15,727 4,766 20,492 20,492 0
16,199 4,294 20,492 20,492 0
16,685 3,808 20,492 20,492 0
17,185 3,307 20,492 20,492 0
17,701 2,792 20.492 20,492 0
410,000
440,000
440,00O
513,200
528,596
544,454
540,295
536,012
531,599
527,055
522,374
517,553
512,587
507,473
502,204
496,778
491,189
485,432
479,503
473,395
467,105
460,626
453,952
447,078
439,998
432,706
425,194
417,458
409,489
401,281
392,827
384 120
375 151
365 913
356 398
346 598
336 503
326 106
315 397
304366
293 005
281 303
269 249
256 834
244047
230 876
217,310
203,337
188,944
174,120
158,851
143.125
126,926
110,241
93,056
75,355
Cods
Incuffed
Explanation
Cods
PERIOD ENDING
Yrs. Mth. Yr.
410,000
30,000
?
60,000
Purchase
Demo/Other
Land Sale
Pub. Improv.
0.0 12-01 1996
0.0 07-01 1997
0.0 12-01 1997
0.0 07-01 1998
0.0 12-01 1998
0.0 07-01 1999
0.5 12-01 1999
1.0 07-01 2000
1.5 12-01 2000
2.0 07-01 2001
2.5 12-01 2001
3.0 07-01 2002
3.5 12-01 2002
4.0 07-01 2003
4.5 12-01 2003
5.0 07-01 2004
5.5 12-01 2004
6.0 07-01 2005
6,5 12-01 2O05
7.0 07-01 2006
7.5 12-01 2006
8.0 07-01 2007
6.5 12-01 2007
9.0 07-01 2008
9.5 12-01 2008
10.0 07-01 2009
10.5 12-01 2009
11.0 07-01 2010
11.5 12-01 2010
12.0 07-01 2011
12.5 12-01 2011
13,0 07-01 2012
13.5 12-01 2012
14.0 07-01 2013
14.5 12-01 2013
15.0 07-01 2014
15.5 12-01 2014
16.0 07-01 2015
16.5 12-01 2015
17.0 07-01 2016
17.5 12-01 2016
18.0 07-01 2017
18.5 12-01 2017
19.0 07-01 2018
19.5 12-01 2018
20.0 07-01 2019
20.5 12-01 2019
21.0 07-01 2020
21.5 12-01 2020
22.0 07-01 2021
22.5 12-01 2021
23.0 07-01 2022
23.5 12-01 2022
24.0 07-01 2023
24.5 12-01 2023
25.0 07-01 2024
Totals 469,098 555,522 1,024,620 1,024,620 44,454 75,355
Cashflow analysis prepared by CITY OF ELK RIVER 12/20/96
EXHIBIT C
Developer Letter of Intent
Tax Increment Financing District No. 16 Page C-1
Vernon S~ee! NW
Bulldlr~ 1D0, Vern~,q PL~r.a
(612) 441-~,35
-21 May 199~
TO: Elk River HRA & EDA
13065 Orono Road
Elk River, Mn. 55330
SUBJECT: King & Main Redevelopment
We would like to propose the construction of a multi-tennant
zero lot-line building on the corner of King and Main Street in
downtown Elk River. The size of the building would range from at
least 10,000 S.F. up to about 14,000 S.F. based on tennants'
space requirements and design constraints. Completed value of
the building would range from $800,000.00 to over $1 million, and
not be less than $800,000.00.
Construction would begin as soon as tennant commtttments were
firm, design completed and construction lending in place. The
earliest anticipated start is late summer/early fall 1996 with
substantial completion January 1, 1997.
We understand that the Elk River HRA intends to create a TIF
District to facilitate this project by way of land cost write-
down and demolition. We could not undertake the project without
such assistance, based on what we understand to be the present
owners' position on price.
Because of the anticipated TIF assistance, we agree that if we
cannot start constroctionin 1996 and substantially complete it by
January 1, 1997, that we must then delay construction start. In
that event, we would not start construction before July 1, 1997,
and would substantially complete construction by January !, 1998.
Land purchase of the 180' × 180' parcel would be a minimum of.
$225,000 after buildings bought, site cleared,~B-~dYl'
corrections made as necessary.
We are prepared to immediately beg{n, drafting discussions and
enter into a binding redevelopment contract to commence the
pr o~ct.
ThgnR You /)
~he Chuba Company
F,A,,X TRANSMrTTAL # of Pages_
CO:_P..cr? ~'. A, .
DEPT._ .. PHOI~..: (812) 441-44~
FAXt '~/' 94Z..¢"'~. i:/,Xi~ (¢12)441-5~35
COMk4Ehrf$
NEW CONSTRUCTION & REMODELING
TATEM
EXHIBIT D
Minnesota Business Assistance Form
(Minnesota Department Of Trade And Economic Development)
Minnesota Business Assistance Form*
Minnesota Department of Trade and Economic Development
Please type or print in dark ink.
1. Funding government agency name
2. Agency street address
3. City 4. Zip Code 5. Phone number (area code) 6. Fax number (area code)
7. Contact name 8. Type of government agency
~ City ~County ~Regional ~State
__ Other (Pica.se indicate)
9. Name of-fll~ district (if applicable)
10. Name of business receiving assistance 11. Date business received assistance
12. Job creation goals for business receiving assistance 13. Hourly wage level goals for business receiving assistance
14. Actual jobs created since business received assistance
15. Actual average hourly wage paid to ernploy~s hired since
business received assistance
16. Last date actual wage and job creation levels documented
* Please complete one form for each business project your agency assisted with $25,000 or more in public funds.
Please send completed form annually by March 1 to:
Minnesota Business Assistance Form
Minnesota Department of Trade and Economic Development
500 Metro Square
121 East 7th Place
St. Paul, Minnesota 55101
or fax report to:
(612) 296-1290
For information, call:
(612) 297-1291 or 1-800-657-3858