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98-012 RESRESOLUTION 98 - 12 CITY OF ELK RIVER COUNTY OF SHERBURNE STATE OF MINNESOTA RESOLUTION MODIFYING DEVELOPMENT DISTRICT NO. 1 AND ADOPTING THE DEVELOPMENT PROGRAM THEREFOR; AND ESTABLISHING WITHIN DEVELOPMENT DISTRICT NO. 1, TAX INCREMENT FINANCING DISTRICT NO. 17, AND ADOPTING THE RELATED TAX INCREMENT FINANCING PLAN THEREFOR. 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. The EDA has heretofore established Municipal Development District No. i and adopted the Development Program therefor. It has been proposed that the City modify Development District No. I and adopt the Development Program therefor and establish within Development District No. 1, Tax Increment Financing District No. 17 ("District No. 17"), and adopt the related Tax Increment Financing Plan therefor (collectively, the "Program" and "Plan"); all pursuant to and in conformity with existing law, including Minnesota Statutes, Sections 469.090 through 469.1081 and 469.174 through 469.179, inclusive, as amended, all as reflected in the Program and Plan and presented for the Council's consideration. 1.02. The Council has investigated the facts relating to the Program and Plan. 1.03. The City has performed, or will perform, all actions required by law to be performed prior to the adoption of the Program and Plan by the City, including, but not limited to, notification of Sherburne County and School District No. 728 having taxing jurisdiction over the property included in District No. 17, a request for review of and written comment on the Program and Plan by the City Planning Commission, and a request that the Council schedule a public hearing on the Program and Plan upon published notice as required by law. 1.04 Certain written reports (the "Reports") relating to the Program and Plan and to the activities contemplated therein have heretofore been prepared by staff and submitted to the Council and]or made a part of the City files and proceedings on the Program and Plan. The Reports include data, information and/or substantiation constituting or relating to (1) the "studies and analyses" on why the new District No. 17 meets the so-called 'q~ut for" test; and (2) the basis for the other findings and determinations made in this resolution. The Council hereby confirms, ratifies, and adopts the Reports, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. Section 2. - Findings for the Adoption and Approval of the Program and Plan. 2.01. The Council hereby finds that the Program and Plan, are intended and, in the judgment of this Council, the effect of such actions will be, to provide an impetus for development in the public purpose and accomplish certain objectives as specified in the Program and Plan, which are hereby incorporated herein. Section 3. - Approval and Adoption of the Program and Plan. 3.01. The Council hereby finds that Tax Increment Financing District No. 17 is in the public interest and is an "economic development district" under Minnesota Statutes, Section 469.174, subd. 12. 3.02. The Council further finds that the proposed development would not occur solely through private investment within the reasonably foreseeable future and that the increased market value on 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 District No. 17 permitted by the Tax Increment Financing Plan, that the Program and Plan conform to the general plan for the development or redevelopment of the City as a whole; and that the Program and Plan will afford maximum opportunity consistent with the sound needs of the City as a whole, for the development of District No. 17 by private enterprise. 3.03. The City elects to make a qualifying local contribution in accordance with Minnesota Statutes, Section 273.1399, subd. 6(d), in order to qualify District No. 17 for exemption from state aid losses set forth in Section 273.1399 subd. (c). 3.04. The Council further finds, declares, and determines that the City made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit A. Section 4. Approval and Adoption of the Program and Plan 4.01. The Program and Plan, as presented to the Council on this date, including without limitation the findings and statement of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the EDA Executive Director. 4.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Program and Plan and to negotiate, draft, and prepare and present to this Council for its consideration all further plans, resolutions, documents, and contracts necessary for this purpose. 4.03. The Auditor of Sherburne County is requested to certify the original net tax capacity of District No. 17, as described in the Program and Plan, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the City of Elk River is authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify, together with a list of all properties within District No. 17, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution. The motion for the adoption of the foregoing resolution made by Councilmember Farber and was duly secondedby Councilmember Thompson and upon a vote being taken thereon, the following voted in favor thereof: Mayor Duitsman Councilmembers: Farber, Thompson, Dietz, and Holmgren and the following voted against the same: None Dated: February 17, 1998 ATTEST: Sandra A. Thackeray, City Clerk~'~ EXHIBIT A RESOLUTION NO. 98 - The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 17 ("District No. 17") as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: Finding that the District No. 17 is an "economic development district" as defined in Minnesota Statutes, Section 469.174, Subdivision 12. District No. 17 consists of one parcel of property. The District is in the public interest because it will discourage manufacturing from moving their operations to another state or municipaliW; it will result in increased employment in the state, and it will result in preservation and enhancement of the tax base of the state. Finding that the proposed development, in the opinion of the Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that 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 district permitted by the plan. Due to the high cost of site development on the parcel and the cost of financing the proposed improvements, this project is feasible only through assistance, in part, from tax increment financing. A comparative analysis of estimated market values both with and without establishment of Tax Increment Financing District No. 17 and the use of tax increment has been performed as described above. If all development which is proposed to be assisted with tax increment were to occur in District No. 17, the total increased market value would be up to $850,000. It is the Council's finding that no development with a market value of greater than $509,692 would occur without tax increment assistance in this district within 9 years. This finding is based upon evidence from general past experience with the high cost of site improvements in the area of District No. 17. Finding that the Tax Increment Financing Plan for District No. 17 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 for District No. 17 has been reviewed by the Planning Commission on December 23, 1997, and been found to conform to the Comprehensive Plan and general development plan of the City. Finding that the Tax Increment Financing Plan for District No. 17 will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development of Municipal Development District No. I by private enterprise. The industrial development to be assisted by District No. 17 will result in increased employment in the City and the State of Minnesota, increased tax base of the State and add a high quality development to the City.