01-09-2012 Council Workshop Minutes

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MINUTES CITY COUNCIL JANUARY 9, 2012 Vogt next compared the City's projected captured TIF tax capacity as a percentage of tax base (9.3%) with that of other cities, noting that Little Canada is about average today versus similar cities. She also noted that the City's TIF 2 -1 District will decertify in 2014. Vogt reviewed the City's TIF administrative expenses which include City staff time, legal expenses, financial advisory expenses, and publication and reporting expenses. Vogt noted that the maximum administrative expenses allowed are 10 %. She then reviewed a chart which showed the estimated amount of increment remaining in the City's TIF Districts for payable 2011 after district obligations have been paid and after estimated administrative costs (pages 7 and 8 of the report). Keis asked if the goal should be to meet the 10% maximum. Hagen noted that if the City does not meet the 10% maximum, those dollars are available for other eligible costs. Vogt then reviewed the TIF Summary and Recommendations beginning on page 9 of the report. With regard to development districts and project areas, Ehlers recommended that the city combine all development districts, except for Redevelopment Project Area #1, into a single development district coterminous with the city's boundaries. Vogt noted that Redevelopment Project Area #1 is under the authority of the EDA. The EDA could transfer authority back to the city, and then could be combined with other districts. Otherwise a separate modification action would be necessary to have its boundaries made coterminous with the City. Vogt noted that there are two reasons for modifying the districts. First, development districts that encompass the entire City would not need further modifications due to the creation of future tax increment districts. Secondly, TIF dollars spent outside the boundaries of a TIF District (within the pooling limitations) still need to be spent within their respective development district. Vogt then reviewed cash balances and use of each TIF District. She noted that TIP 1 -5 has been decertified and the ending fund balance is $0. TIF 2 -1 is the City's only pre-1 990 district, and there are no limitations on how TIF dollars can be spent after obligations are taken care of. 2017 is the last year for this district. The City Administrator noted this is the County Drive redevelopment and suggested that some of the dollars from this District could be used to acquire the Ketchmark property to complete the acquisition of the homes on Country Drive. The City has control of the properties necessary for redevelopment with the exception of the Ketchmark and Gagne properties. The Administrator felt that the Gagne property would sell on its own. Vogt noted that TIF dollars from this district can be spend inside or outside the boundaries of the district. 2