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The State of Minnesota 2010 Jobs Rill authorized the use of cash balances in existing tax <br />increment to spur new construction or substantial rehabilitation in your community. Local <br />governments can spend existing tax increment regardless of when the district was certified and <br />without worrying about the many restrictions that have applied before, such as the five -year rule <br />and pooling limitations. <br />The tax increment spending exceptions in the 2010 Jobs Bill were set to expire in 201 1. The <br />legislature extended those provisions by one year for commercial projects, and by six months for <br />market rate housing projects. Any cash balances used for commercial development must be <br />expended by December 31, 2012. <br />The project must consist of the construction or substantial rehabilitation of privately owned <br />buildings and ancillary facilities, if doing so will create or retain jobs in the State, including <br />construction jobs. Projects can consist of commercial, industrial, office, and market rate <br />housing. (The ability to assist income - restricted housing projects expires on July 1, 2011.) <br />For commercial and industrial projects, construction must begin before July 1, 2012, and tax <br />increment must be spent by December 31, 2012. For market -rate housing, construction must <br />begin before December 31, 2011, and tax increment must be expended by July 1, 2012. <br />The first step is to hold a public hearing and adopt a spending plan that specifically authorizes <br />the assistance. The city will then need to enter into a development agreement that specifies how <br />much increment will be provided, what it will pay for, and what form the assistance will take, <br />what and when the developer must build, and what jobs will be created. Under the law, the <br />assistance may be provided as a: <br />• Direct loan <br />• Grant <br />o Interest rate subsidy on developer's private financing <br />e Equity or similar investment in corporation, partnership, or limited liability company <br />• Applied by the city to pay for public improvements such as utilities, streets, and storm <br />water improvements that are necessary for the project. <br />HLERS <br />11:AUEI151N PUBLIC NUANCE <br />Offices also in Wisconsin and Illinois <br />2 <br />651. 607.6500 <br />651-697-8555 <br />800 -552 -1171 <br />3060 Centre Pointe Drive <br />Roseville, MN 55113.1122 <br />