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EXI+ aV 251d1/4 ceazrzaek <br />515 Little Canada Road, Little Canada, MN 55117 -1600 <br />(651) 766 -4029 / FAX: (651) 766 -4048 <br />Email: cityhall @ci .little - canada.mn.us <br />MEMORANDUM <br />TO: Mayor Fahey and Members of the City Council <br />FROM: Joel Hanson, City Administrator <br />DATE: February 23, 2001 <br />RE: TIF Legislative Issues <br />MAYOR <br />Michael 1. Fahey <br />COUNCIL <br />Beverly Scalze <br />Jim LaValle <br />Ma[[ Anderson <br />Rick Montour <br />ADMINISTRATOR <br />Joel R. Ranson <br />At the last Council meeting a question was raised regarding legislative proposals aimed at <br />further restricting Tax Increment Financing. There have been two principle proposals. <br />They are: <br />• Senate File 65 introduced by Senator Marty that would prohibit the certification of <br />new and modified TIF Districts after May 31, 2001. This bill would also repeal the <br />tax abatement law and further restrict the use of other business subsidies. I am told <br />by the League of Minnesota Cities' legislative staff that this bill is not progressing. <br />♦ Senate File 73 (House Companion 187). This bill requires that Tax Increment <br />Financing Districts certified prior to May 1, 1990 (Country Drive District 2 -1) may <br />no longer modify their TIF plans after April 30, 2001. Furthermore, revenues derived <br />from tax increments must be committed to an activity that is subject to contract or <br />bond repayments by April 30, 2002 (see attached bills for exact wording). In the case <br />of Country Drive, this would mean we would have to have purchased the remaining <br />properties and /or have a development agreement in place that would expend funds <br />pursuant to our plan by April 30, 2002. If we do not complete our activities by that <br />date, we would be unable to continue with our redevelopment program. <br />In discussing Senate File 73 with Ramsey County officials, I was informed <br />that the goal of this legislation was to prevent plan modifications /pooling that would <br />extend the life of the district beyond the program that was initially contemplated. <br />Ramsey County favors this concept in order to get TIF Districts back on the tax rolls <br />once the initial development program has been accomplished. However, the <br />proposal as written appears to provide even greater restrictions. <br />Page 43 <br />