8.2. SR 02-20-2018 EOty1� ,.,�� Request for Action
River
To Item Number
Mayor and City Council 8.2
Agenda Section Meeting Date Prepared by
General Business February 20, 2018 Amanda Othoudt,EDD
Item Description Reviewed by
Resolution: Denying Tax Increment Assistance for Cal Portner, City Administrator
Elk River Lodge & Residential Suites, LLC Reviewed by
Action Requested
Approve,by motion, a resolution of denial for the Elk River Lodge& Residential Suites, LLC project.
Background/Discussion
Staff presented the Elk River Lodge and the Jackson Hills Residential Suites Housing TIF applications to
the Council during a work session on February 5, 2018. The applicant requested that increment from the
Jackson Hills project be pooled and utilized for certain improvements to the Elk River Lodge project.
Although Minnesota law permits increments to be "pooled" or spent outside of the district, the
consensus of the Council was to not pool increment from the Jackson Hills project for improvements
that were already approved for construction and have already commenced at the Elk River Lodge
property.
Financial Impact
N/A
Attachments
■ Resolution
The Elk River Vision
A PehoMing community 2a itb revolutionary and spirited resourcefulness, exceptional POWERED By
service, and community engagement that encourages and inspires prosperity INAWRE1
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City of
Elk City of Elk River
"� City Council
River
Resolution 18-
A Resolution of the City Council of the City of Elk River Denying Tax
Increment Assistance for Elk River Lodge & Residential Suites, LLC
WHEREAS, the City of Elk River,Minnesota(the "City")is authorized by Minnesota
Statutes,Sections 469.174 to 469.1794 (the "TIF Act") to grant a tax increment assistance in
accordance with the TIF Act;
WHEREAS, the City has reviewed a proposal by Elk River Lodge&Residential Suites,LLC
(the"Developer") to utilize a portion of the tax increments to be generated by the proposed
construction of an approximately 40-unit rental housing facility(the"Jackson Hills Pro)ect") to
finance interior and exterior renovations to the Elk River Lodge located within the City(the
"Lodge Improvements") in connection with a conversion to residential rental units;
WHEREAS, (i) the Lodge Improvements do not generate tax increments sufficient to
finance the requested amount of assistance in the application as a portion of the Lodge
Improvements have previously commenced with permits pulled,thus negating incremental
value,and (ii) the proposed use of tax increments for the Lodge Improvements does not meet
the but-for test under the TIF Act because a portion of the proposed Lodge Improvements are
required to bring the Elk River Lodge into compliance with the City's zoning code and
construction on a portion of the Lodge Improvements has already commenced;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk
River,Minnesota, as follows:
1. The Council denies the Developer's application and declines to provide assistance for
the Lodge Improvements.
2. This resolution is effective on the date hereof and staff is directed to return any
unspent portion of the Developer's deposit for costs after applying such deposit to
costs incurred by the City through the date hereof.
Passed and adopted this 201h day of February 2018.
John J. Dietz,Mayor
ATTEST:
Tina Allard, City Clerk
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