3.10 EDSR 01-20-2015
Request for Action
To Item Number
Economic Development Authority 3.10
Agenda Section Meeting Date Prepared by
ConsentJanuary 20, 2015Jeremy Barnhart, Deputy Director, CODD
Item Description Reviewed by
Receive report on Modifications/Amendments to
Statute and/or Enabling Resolution
Reviewed by
Action Requested
Receive report
Background/Discussion
Economic Development Authority Bylaws allow for the review of any modifications or amendments to
the Statute and/or Enabling Resolution. The EDA attorney has provided a review and submitted an
update as suggested each year, attached.
These updates will be reflected in ongoing processes and policies. If there are any questions on the
update
Financial Impact
N/A
Attachments
EDA attorney memo dated December 31, 2014
MEMORANDUM
TO:
Elk River EDA Chair and Commissioners
FROM:
Andrea McDowell Poehler
DATE:
Wednesday, December 31, 2014
RE:
Economic Development Authority Legislative Update
__________________________________________________________________
The bylaws for the EDA require an annual update of legislative changes to the Economic
Development Authority Act, Minn. Stat. § 469.090 to § 469.1082.
There were no legislative changes to theEconomic Development Authority Act.
Other economic development legislative changes included the following:
Economic development provisions in the Omnibus Capital Investment (Bonding) Act
.
Chapter 294 (HF 2490*/SF 2605) is the 2014 Omnibus Capital Investment (Bonding) Act.
Article 1, section 21, subd. 2 provides $4 million for Greater Minnesota Business
Development Public Infrastructure Grants under Minn. Stat. § 116J.431. Effective May 21,
2014.
Tax increment financing (TIF) five-year rule.
Section 3 amends Minn. Stat. § 469.1763,
subd. 3 to extend the five-year rule to eight years for redevelopment districts certified after
April 20, 2009, and before June 30, 2012. The five-year rule essentially requires
development activity within a TIF district to be finished within a five-year period that begins
with certification of the original tax capacity of the TIF district. After this five-year period
has expired, increments may only be spent to pay off obligations that were incurred to fund
work done during the five-year period or to the extent permitted under the pooling rules and
when these obligations are paid (or enough money has been collected to pay them), the
district must be decertified. Effective for districts for which the request for certification was
made after April 20, 2009.
Tax increment economic development districts; fiscal disparities option.
Section 4
amends Minn. Stat. § 469.177, subd. 3 to allow cities the option to make the fiscal
disparities contribution for economic development TIF districts in the same ways that are
available for other types of tax increment districts. Under this change, a city can elect to
make the fiscal disparities contribution either out of the TIF district increment, as is
currently required, or out of the general city tax base. If chosen, this new option will allow
economic development districts to realize more increment, but will shift the fiscal disparities
contribution to the balance of the local tax base, thereby reducing the city’s tax base for
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general levy purposes and increasing the city’s general tax rate. Effective for districts for
which the request for certification is made after June 30, 2014.
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