07-09-2002 Council Agenda - Laserfiche WebLink

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TIP District Overview The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 3 -3, as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that Tax Increment Financing District No. 3 -3 is a housing district as defined in M.S., Section 469.174, Subd. 11. The District consists of four parcels. The development will consist of an approximately 35 -unit multi- family residential rental senior housing addition to the existing senior housing facility known as "Garden Terrace" designed for persons or families of low and moderate income and an approximately 78 -unit multi - family residential rental senior housing facility known here as "Village Square at Little Canada" designed for persons or families of low and moderate income over approximately 14,000 square feet of commercial /retail space. For the rental housing units, the City will comply with applicable income restrictions pursuant to M.S., Section 469,1761, Subd. 3. The market value of non- assisted housing or commercial property will be less than 20 percent of the total fair market value of the planned improvements. Appendix E of the Plan contains background for the above finding. 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the District permitted by the Plan. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: This finding is supported by the fact that the development proposed in this plan is a housing district that meets the City's objectives for development and redevelopment. The cost of land acquisition, site and public improvements and utilities makes this housing development infeasible without City assistance. Due to the high cost of building affordable new housing in the City and the cost of financing the proposed public improvements, this project is feasible only through assistance, in part, from tax increment financing. The developer was asked for and provided a Letter and a proforma as justification that the developer would not have gone forward without tax increment assistance (see attachment in Appendix F of the Plan). The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the District permitted by the Plan: This finding is justified on the grounds that the cost of land acquisition, site and public improvements and utilities add to the total development cost. Historically, site development costs in this area have made development infeasible without tax increment assistance. This site has been marketed for several years without success. Therefore, the City reasonably determines that no other development of similar scope is anticipated on this site without substantially similar assistance being provided to the development. Page 4 EHLERS