10-10-2007 Council Agenda - Laserfiche WebLink

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MAYOR Bill Blesener COUNCIL Rick Montour Barbara Allan John Keis Michael McGraw 515 Little Canada Road, Little Canada, MN 55117 -1600 ADMINISTRATOR (651) 766 -4029 / FAX: (651) 766 -4048 Joel R. Hanson www.cilittle-canada.mn.us MEMORANDUM TO: Mayor Blesener & Members of the City Council FROM: Joel R. Hanson, City Administrator DATE: October 5, 2007 RE: Adoption of Tax Increment Financing Program and Related Materials Attached are the materials we need to consider and /or approve to create the Tax Increment Financing Program for the St. Jude and Viking Drive projects. Todd Hagen of Ehlers & Associates has prepared a "Tax Increment Financing District Overview" that summarizes the Development Program and the action steps needed related to the creation of the Development District. Mr. Hagen will be present at Wednesday's meeting to walk us through the action steps. We have included a new Business Subsidy Plan for your consideration. The City previously adopted a plan, but it no longer complies with current statutory requirements. I will be reviewing this draft with Ehlers prior to Wednesday's meeting to see if any further modifications are necessary. It appears we would not have to adopt this at Wednesday's meeting given we will no longer be providing any direct subsidy to St. Jude. However, we will want to address this at some point to bring us current in statutory compliance for any future projects. I also want to expound on the fact that we will be no longer providing direct assistance to St. Jude. As of now, it appears the best use of TIF will be for various infrastructure upgrades to serve this entire area consisting of sanitary sewer, water main, streetscape, and possible land acquisition for widening of County Road B2. Some of the infrastructure will be constructed on St. Jude's property, but it will be done within easements being dedicated to the City in order to make it part of our system from a construction and maintenance standpoint. This also results in elimination of the any business subsidy and in the "Pay As You Go" concept whereby St. Jude would have advanced project costs and then be repaid from future increments to the extent they were available. Under the revised program, we will be issuing debt for our infrastructure and capturing all of the increment for City usage. We will still have a development agreement with St. Jude and include provisions for minimum assessed value and TIF guarantees. (The development agreement will be presented at a future meeting.) It is contemplated that any debt we issued will be tax 1