07-22-98 Council Minutes - Laserfiche WebLink

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iVIlNUTE5 CITY COUNCIL JULY 22, 1998 Sc~lze reviewed die pasC hiseory in lssistin~ the Kandice Heigl~ts projects and concerns that wei e expressed by other business owners about this assistlnce. The TIF w1s provided to I<andice Heights with tl~e hope that further development could occur wifh the help of the excess increments tl~at would be ~ener~tecl. This addiYionai deve(opment did not happen. The City Administrtita' reviewed tl~e annull debt service payments and the ef~ect tl~at class rate reductions would have. The Administrator suggested that the guarantee could be equal to the average debt service payment or else the annual debt service payment. Morelan s~i~gested that the minimum be set as eq~ial to the annual debt se~vice payment for the reinainder of the life of the bond. This guarantee will only come into pay if the Legislatw'e reduces class rates further for commerciai/ind~istri~l property. Ostlund ~sl<ed if taxes on this }~ro~erCy would be more tl~~n what they are on lilce property. If so, that would m11<e the project non-competitive. The Aciministrator pointed out that tax rates ~re going down. Tax rates could gu up in the {'uture; however, other properfies would see this same i~~crease. Klndice I-lei~hts p2ys taxes just lil<e all other properties do - no more-no less. Fahey pointed out that if taxes go down, the minimum amount paid by ICandice Heiahts woulcl be a~~ amowit eq~ia( to the City's debt service on the bonds. Fahey suggested thlt if tax rates go down, tl~e Council would be willin~ to have this discussion with the property owners a~1in. 1-towever, at this poinC he w~s comfortable witli tl~e suggestion made by Cowicil Member Morelan. Fahey stated that the C,ity is interested in providin~ additional TIF assisC2nce to finalize the tlevelopment in the area. L-Ie would be willing to revisit the interest rlte if tl~at ~vill mal<e existing propeity more competitive res~i(tin~ in ~dditional development i~~ the area. Royce w2s ~~oC sure of'the effect of Council Member Morelan's suggestion on the project. Fahey suggested that the details be discussed with staff and should tl~ere be additional concerns, he wo~iid c111 1 s~eciil meeting ofthe Council to discuss the m1CCer f~irCher. The Administrltor pointed out th~t if class rates do not chan~e, the issue will not come into play. The only way that the minim~im i~~crement guarantee comes into play is if cl~ss raYes go down furtl~er tl~an what has beeu enacted to date by the Legisl~ttw'e. 7