RES 15-36CITY OF ELK RIVER
RESOLUTION #2015- 36
APPROVING PROPERTY TAX ABATEMENT FOR
CERTAIN REAL PROPERTY IN THE CITY PURSUANT TO
MINNESOTA STATUTES, SECTIONS 469.1812 TO 469.1815
AND SPECIFYING THE TERMS THEREOF
WHEREAS, the City of Elk River, Minnesota (the "City") is authorized by Minnesota Statutes,
Sections 469.1812 to 469.1815 (the "Abatement Act") to grant a property tax Abatement (as defined in
Section 3 of this resolution) in order to achieve one or more public purposes identified in the
Abatement Act;
WHEREAS, the City has reviewed a proposal by Envision Company, LLC (the "Developer")
to construct an approximately 105,000 square foot manufacturing facility (the "Facility") to be located
in the City on the property identified as Lots 1 and 2, Block 2, Natures Edge Business Center Second
Addition, tax parcel numbers 758280205 and 758280210 (the "Development Property");
WHEREAS, the City proposes to sell the Development Property to the Developer, and to that
end, the City will consider approving a Purchase Agreement between the City and Developer (the
"Purchase Agreement");
WHEREAS, the Development Property is not located in a tax increment financing district;
WHEREAS, the City and the Economic Development Authority of the City of Elk River (the
"EDA'D have also detemnined that is reasonable and necessary to provide certain financial assistance to
Developer in order to facilitate Developer's plans for the Facility and the Development Property, and to
that end, the City will consider approving a Tax Abatement Agreement between the City and Developer
(the "Abatement Agreement') and, pursuant to Minnesota Statutes, Sections 116J.993 to 116J.995, a
Business Subsidy Agreement between the City and Sportech, Inc. (the "Subsidy Agreement");
WHEREAS, among other things, the proposed Abatement Agreement will provide that the
City will assist the Developer in financing the cost of the acquisition of the Development Property and
a portion of the cost of the Facility, 'subject to certain terms and conditions, including the adoption of
this resolution (the "Abatement Assistance'); and the Developer will construct the Facility, subject to
certain terms and conditions;
WHEREAS, on the date hereof, the City conducted a duly noticed public hearing on the
Abatement at which the views of all interested persons were heard;
WHEREAS, all capitalized terms in this resolution have the meanings provided in the
Abatement Agreement unless context clearly requires otherwise;
NOW, THEREFORE, BE IT RESOLVED BY the City Council (the "Council") of the
City of Elk River, Minnesota as follows:
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1. Benefits Equal Costs. It is hereby found and determined that the benefits to the City
from the Abatement will be at least equal to the costs to the City of the Abatement for the following
reasons:
(a) The Abatement will stimulate commercial development and therefore will increase the
tax base.
(b) The Facility will generate significant City tax revenues after termination of the
Abatement, which revenues will fax exceed the amount of the Abatement itself.
2. Public Purposes. It is further found and determined that the Abatement will serve the
following public purposes set forth in Section 469.1813, subdivision 1 of the Abatement Act:
(a) The Abatement will stimulate commercial development and therefore will increase
the tax base.
(b) The Abatement will provide employment opportunities in the City.
3. Abatement Agpxoved. The Abatement is hereby approved and adopted subject to the
following terms and conditions:
(a) "Abatement" or "Abatements" means the City's share of annual real estate taxes on
the Development Property for a term of up to 20 years in a principal amount not to exceed
$1,288,590.
(b) The City will pay the Abatements in the amount, at the time, and in accordance with
all the terms and conditions set forth in the Abatement Agreement, which are incorporated herein
by reference.
(c) The Abatement is subject to modification in accordance with the Abatement Act, but
only to the extent so permitted under the terms of the Abatement Agreement.
(d) In accordance with Section 469.1815 of the Abatement Act, the City will add to its levy
in each year during the term of the Abatement the total estimated amount of current year Abatement
granted under this resolution.
(e) The City makes no warranties or representations regarding the amount or availability of
the Abatements.
(f) In accordance with Section 469.1813, subdivision 8 of the Abatement Act, in no case
shall the Abatement, together with all other abatements approved by the City under the Abatement Act
and paid in any one year exceed the greater of 10% of the City's net tax capacity for that year or
$200,000.
5. Execution of Documents. The City Council hereby approves the Purchase
Agreement, the Abatement Agreement, the Subsidy Agreement and any related documents
necessary in connection therewith (collectively, the "Documents") and, the Mayor and City Clerk are
hereby authorized and directed to execute the Documents to which the City is a party on behalf of
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the City and to carry out, on behalf of the City, the City's obligations thereunder. In the event of
absence or disability of the officers, any of the Documents authorized by this Resolution to be
executed may be executed without further act or authorization of the Council by any duly designated
acting official, or by such other officer or officers of the City as, in the opinion of the City Attorney,
may act in their behalf.
6. Finalizing Documents. The approval hereby given to the Documents includes
approval of such additional details therein as may be necessary and appropriate and such
modifications thereof, deletions therefrom and additions thereto as may be necessary and
appropriate and approved by legal counsel to the City and by the officers authorized herein to
execute said Documents prior to their execution; and said officers are hereby authorized to approve
said changes on behalf of the City. The execution of any instrument by the appropriate officers of
the City herein authorized shall be conclusive evidence of the approval of such Document in
accordance with the terms hereof
7. Conflicting Provisions. In the event of a conflict between the content of this resolution
and the Documents, the terms of the Documents shall prevail
8. Effective Date. This resolution is effective upon execution in full of the Abatement
Agreement
Approved by the City Council of the City of Elk River this 20'" day of July, 2015.
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ATTEST:
City Clerk
4646890 EL185-31