3.8. SR 04-16-2007
City of Elk River
REQUEST FOR COUNCIL ACTION
Agenda Section Meeting Date
Consent A ril 16, 2007
Item Description
Concur and Approve Decertification of TIF District #15
cChesne
Item Number
3.8.
Prepared by
Tim Simon, Finance Director
Reviewed by
Lori Johnson, City Administrator
Introduction
On April 9, 2007 the Economic Development Authority approved the decertification of Tax Increment
District No.15 (I\1cChesney). The City Council is asked to concur with the EDA to decertify Tax
Increment District #15.
Discussion
Tax Increment District #15 was an economic development district and the statutory maximum life for
this type of district is 8 years after receipt of first increment. All obligations to the developer have been
met within the statutory life of the district.
McChesney Cabinets is a manufacturer and installer of custom cabinets and countertops and specialty
wood items. The district was established to support the construction of a 10,000 square foot facility in
the McChesney Industrial Park. (Tax increment Financing Plan)
Financial Impact
All Taxes Payable on the parcel of property will be distributed to the school, county and city in the same
manner as all property taxes. The TIF tax generated for taxes payable 2007 is $10,206.52.
Attachments
. Economic Development Authority memorandum on April 9, 2007.
. Resolution approving decertification of Tax Increment #15 (I\1cChesney) from the EDA.
Action Requested
Concur and approve decertification ofTIF district #15 (I\1cChesney).
Council Action
Motion by_
Second by _
Vote
Follow Up
S,\Council\Tim\D"ertify #15 (2).doc
ITEM # 5.
MEMORANDUM
TO: Economic Development Authority
FROM: Catherine Mehelich, Director of Economic Developmen(#(
DATE: April 9, 2007
SUBJECT: Consider Resolution Approving the Decertification of Tax
Increment Financing District No. I 5 (McChesney) in the City of
Elk River
Attachments
. TIF Pl= - TIF District No. 15 Summary
. EDA Resolution Approving the Decertification ofTIF District No. 15 (McChesney)
Background
In 1996 the EDA and City created TIF District No. 15 in order to provide financing
assistance for the construction of McChesney Cabinet's 10,000 square foot industrial facility.
Located in the McChesney Industrial Park along Meadowvale Road, McChesney Cabinets is
a manufacturer and installer of custom cabinets, countertops and specialty wood items. The
attached TIF Pl= Summary provides additional background about the project.
Issue
. The duration of TIF District 15 was limited to 8 years after the receipt of the first tax
increment cruly 1998). Since the obligations of the TIF District to the developer and its
useful life toward financially supporting other TIF Districts has reached its term, it is
necessary to decertify the TIP District at this time. As a result of the decertification, all local
property taxes generated by the property (currently in the amount of $10,200) will be
distributed to the school, county and city in the same manner as all other property taxes.
Requested Action
In accordance with statutory requirements, the EDA is asked to consider the attached
Resolution Approving the Decertification ofTIF District No. 15.
ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY
COUNTY OF SHERBURNE
STATE OF MINNESOTA
RESOLUTION 07-0 I
RESOLUTION APPROVING THE DECERTIFICATION OF TAX
INCREMENT FINANCING DISTRICT NO. 15 WITHIN DEVELOPMENT
DISTRICT NO. I IN THE CITY OF ELK RIVER
WHEREAS, on June to, 1996 the Elk River Economic Development Authority (the
"Authority") created its Tax Increment Financing District No. 15., (the "District") within its
Development District No.1 (the "Project"); and
WHEREAS, as of the date hereof all bonds and obligations to which tax increment from
the District had been pledged have been paid in full or defeased and all other costs of the
Project have been paid; and
WHEREAS, the Tax Increment Financing plan adopted on June 10, 1996 for Tax
Increment Financing District No. 15 requires, pursuant to M.S. 469.176, Subd.1, that the
duration of the Tax Increment Financing District 15 will be eight years after the date of
receipt by the City of the first tax increment or ten years from approval of the tax increment
financing plan, whichever is less; and
WHEREAS, the continuance ofTIF District No. 15 serves no public or private purpose;
and
WHEREAS, the Authority desires by this resolution to cause the decertification due to its
payment of obligations of the Districr after which all property taxes generated by property
within the Districts will be distributed in the same manner as all other property taxes
beginning July 3, 2007,
NOW THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Elk
River Economic Development Authority that the city's staff shall take such action as is
necessary to cause the County Auditor of Sherburne County to decertify the District as a tax
increment district and to no longer remit tax increment from the District to the Authority.
DATED: April 9, 2007
~V-
ATTEST:
Jeffrey A. Gongoll, President
~~
Catherine Mehelich
C:\Documents and Scttings\tallard\Local Settings\ Temporary Internet Files\OLKF\DECERT.DOC