06/07/2001 EDAC Minutes - Laserfiche WebLink

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3 Tax Increment is only available on a portion of the Tagg site, and since the Target property is a greenfield site, TIF can’t be used there either. The city will be discussing whether to use abatement in the Town Center. Mr. Jensen said the city will be in a better position than other cities if it does not use TIF on the Target project, because of the potential changes in property tax legislation. Mr. Wessel stated that the Ryan/Target/Kohl’s request is $778,100 net present value in tax abatement. The process to establish a tax abatement program is underway and the council will make its decisions July 23. MARKETPLACE Mr. Wessel said Target is still planning to open July 2002, with groundbreaking late August. Kohl’s will follow shortly after. The tenant retail may be phased. There are still regulatory hurdles, primarily the wetland mitigation plan and the secondary access. Mr. Jensen questioned what are the major issues from the council. Ms. Carlson said she had no indication the council didn’t support it. She has concerns with using abatement to assist businesses, such as a bank and convenience store that already exist in the city. She doesn’t see that limiting competition as the same thing as subsidizing businesses that the city already has. If the businesses want to come in without a subsidy, it’s not a problem. She wondered if the subsidy could be directed to Target and Kohl’s. Mr. Wessel said the market determines what the need is. He took back to the developer the suggestion to take the subsidy request off the table for those users that are controversial. The other controversy is the plan for wetland mitigation in the Rice Creek park reserve. These projects are always complicated, and delay is always a possibility. Ms. Carlson said most concerns of neighbors have been addressed. Ms. Divine stated that in EDAC’s long range economic development plan, use of available tools for assistance for development are recommended. EDAC needs to consider several issues, whether it would recommend the use of abatement to help finance projects within the Town Center, should the council adopt a tax abatement policy that distributes the abatement dollars throughout the Town Center in a way that best benefits the community, and whether the city council should use abatement to limit competition. Mr. Wessel said the specific request asks for a breakout between the three major components, Target, Kohl’s and the Ryan piece. Mr. Rolek said taxes can be abated on any property in the city, to be used anywhere in the city. It doesn’t have to be used just on this project. In this instance we’re looking at abating additional tax dollars generated by this development, so that there is no negative impact on the taxpayers. The city can use it for as long as it wants up to 15 years. As the city looks at the Village, it is likely there will be request for subsidy. Because abatement is a limited tool, we have to structure this so that it is useful for the entire development.