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MINUTES <br />City Council <br />Sept. 2, 1987 <br />Pelstring pointed out the designation by the City of Vadnais Heights <br />for the property abutting County Road E and 35E as their town center. <br />Flug felt that a presentation to developers would indicate what the <br />City wants without actually coming out and sayinq it. <br />Pelstring noted that Policy Statements 5 and 6 were public policy <br />statements. Statement 7 set the security the City would require <br />the developer to post. <br />Statement 7 was discussed and the group determined that it should <br />require a letter of credit from the developer, a personal guarantee <br />from the principles involved in the development, guarantee of <br />project financing that if the developer is lost for some reason, the <br />bank will guarantee the minimum valuation and make the tax payments, <br />and if publically financed, there is a right of reversion so that the <br />City would get the property with no liens. <br />The Clerk asked if a building were expanded that was built with <br />Tax Increment Financing assistance, if the developer could ask for <br />another increment. <br />Pelstring replied that this could be done if the increment was within <br />the original 15 year period. <br />DeLonais asked the percentage of projects in Vadnais Heights that have <br />been built with Tax Increment Financing. <br />Pelstring replied that about IIO% of the industrial development has <br />used Tax Increment Financing, but this is less than 20% of the <br />City's assessed valuation. Not much commercial development in this <br />city has used Tax Increment Financing. <br />Pelstring explained Policy Statements 8, 9 and 10. In statement <br />10 Pelstring suggested that the word "site" be added after "per" <br />in the second line. <br />Pelstring next explained Statement 11, specifically the percentage of <br />50%. It was noted that Vadnais Heights uses a figure of 20%. <br />The group felt that the City had to be competitive with its neighboring <br />cities, and it was suggested that this figure be left blank until the <br />next meeting. <br />Policy Statement 12 was explained and the group felt that with the <br />City's assessed valuation at about $60 million a figure of 5% would <br />be feasible. <br />Pe1string noted that Statements 13 and 14 were procedural, however, <br />statement 13 is optional. <br />The group felt that the Economic Development Committee should review <br />Tax Increment Financing proposals, and that Statement 13 shauld be <br />retained. <br />Page -4- <br />