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515 Little Canada Road, Little Canada, MN 55117-1600 <br />(651) 766 -4029 / FAX: (651) 766 -4048 <br />www.ci.iitue- canada.mn.us <br />MEMORANDUM <br />TO: Mayor Fahey & Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />DATE: June 18,2004 <br />RE: Provinces Agreement <br />MAYOR <br />Michael 1. Fahey <br />COUNCIL <br />Jim LaValle <br />Matt Anderson <br />Rick Montour <br />Bill Blesener <br />ADMINISTRATOR <br />Joel R. Hanson <br />Attached is correspondence received from Mr. Hany Jacobs of Dominium Development, owners of the <br />Provinces Apartment complex. You will note that he is asking that we release the escrow requirement for <br />the finding of a fire sprinkling system as the basis for generating the finds (the 4d class rate) has been <br />eliminated. (I'm enclosing the Tax Credit Usage Agreement— see Item #5). <br />The 4d rate went away as part of the 2001 property tax reform legislation. I have delayed in acting on this <br />item for a couple of reasons. The first is the 4d rate is still listed in the class rates, although there is no <br />longer any preferential treatment of this class of property. The second reason is that the legislature was <br />considering reestablishing preferential treatment in this past session. However, their failure to pass the <br />Omnibus Tax Bill left things as they currently are. (See e -mail from Gary Carlson of the League of <br />Minnesota Cities.) <br />My reading of the agreement indicates that we should eliminate the escrow. This will result in $38,850 <br />plus accrued interest since 1998 being returned to us. Dominium will also have over $100,000 made <br />available to them that they have indicated will put into building improvements at the Provinces. <br />However, it likely means that sprinklers will not be established within that complex. <br />If the Council concurs that the escrow should be eliminated, I would we attempt to ensure the dollars are <br />spent on improving the Provinces. If the Council feels we should wait in anticipation of the 4d rate being <br />reestablished, then we should discuss the basis for that decision. <br />cc: Harry Jacobs <br />Jim Morelan, Fire Chief <br />