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MINUTES <br />Planning Commission <br />March 13, 1986 <br />Tax If property was condemned, it would have to be proven that the <br />Increment property was going to be used for a public purpose. This is a <br />Financing criteria that must be met under any other circumstances. <br />(Cont.) <br />Mr. Costa questioned the need for tax increment. <br />The Planner pointed out the I -P District. There are long - narrow <br />lots in this district that might never be developed. Tax increment <br />would make development possible. The City would come in and use <br />its bonding authority to purchase property. The City would then <br />sell the property to a developer at a reduced price. In return <br />the developer would develop a project of a certain value. The <br />revenue from that project would stay in the City and be used to <br />pay off the bonds. <br />Costa asked what happens if there are two different property owners <br />with two different asking prices for their properties. The Planner <br />replied that independent appraisals would be done on the properties. <br />If agreement could not be reached, the matter could go to court. <br />Timmons questioned whether this was a way for a developer not to <br />have to'work as hard to purchase property. <br />The Planner replied that the developer would have to approach the <br />property owners and determine the asking price. The project would <br />have to he established with architectural drawings of the project <br />made. The project must be one that would not be financially feasible <br />without the help of tax increment financing to purchase property or <br />cover utility costs, etc. <br />Mr. DeLonais expressed concern about the administrative costs that <br />would be involved. The Planner replied that administrative costs <br />are paid out of tax increment. <br />Timmons felt that the I -P District would be the most desirable area <br />for tax increment. <br />Herkenhoff asked whose idea this was. The Planner replied that his <br />office approached the City a couple of years ago on this. However, <br />it was recently brought up by the Economic Development Committee. <br />DeLonais questioned how tax increment would effect the fiscal <br />disparaties situation. The Planner stated that even after paying <br />fiscal disparaties, it will be a good deal for the City. <br />Davison asked if it were better to identify district before or <br />after the City has a developer in mind. The Planner replied that <br />it can be done either way, but it is better to set up the districts <br />prior to having a developer. This is a way for the City to say it may <br />be interested in a development in a particular area. It is an <br />advertising mechanism for the City. <br />Page -4- <br />