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costs must be incurred in an economic development <br />district which in turn must satisfy the stringent <br />"redevelopment district" requirements of the Tax <br />Increment Financing Act.* <br />(iii) The "public costs of redevelopment" for <br />projects undertaken pursuant to the HRA law in a <br />"project redevelopment area ". Unlike the cost <br />restrictions on other projects discussed above, the <br />HRA restriction does not limit the use of tax <br />increments to capital costs. Thus," if the projects <br />were undertaken pursuant to the HRA laws and were <br />qualified as "any work or undertaking to provide <br />housing for persons of moderate income and their <br />families" or an "undertaking . for the <br />elimination or for the prevention of the development <br />or spread of slums or blighted or deteriorating <br />areas" and if any underlying land to be acquired as <br />part of the public costs of redevelopment is either <br />a "blighted area" or satisfies the conditions set <br />forth in Minnesota Statutes, Section 469.028, <br />Subdivisions 3 or 4, then there is little statutory <br />restraint on how tax increments could be used to aid <br />such projects so long as appropriate hearings are <br />held and findings as to need are made by the City <br />Council and the EDA. <br />(iv) The cost of financing or otherwise <br />paying premiums for insurance or other security <br />guaranteeing the payment when due of debt service on <br />housing revenue bonds issued under Chapter 462C or <br />industrial or commercial development revenue bonds <br />issued under the Municipal Industrial Development <br />Act or to fund and maintain a debt reserve for such <br />bonds (not to exceed after five years from date of <br />issuance 20% of the outstanding principal amount of <br />such bonds). <br />c. Transfer of Projects. In order to allow the EDA <br />to use tax increments and other revenues derived from any <br />development districts created under the City Development <br />The "redevelopment district" requirements, which are <br />already stringent, may become even more so if pending <br />amendments to the Tax Increment Financing Act are enacted <br />into law. <br />22 <br />Page 24 <br />