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Economic Development District. Economic Development districts have a maximum <br />term of eight years from the date of first increment received. <br />The developer has identified $5.9 million in eligible TIF project costs and has requested <br />assistance in the amount of $2,088,481. Based on our review of the financing need and <br />gap for this project, as well as the City's policy practice to limit the duration of tax <br />increment to between 5-6 years, staff is proposing to limit the assistance to $1.2 million. <br />This would result in approximately 5.5 years of increment. Funding would be provided <br />by "pay as you go financing". The developer will pay costs with its own funds. The <br />increments are used to reimburse the developer for these costs. <br />One unique component of the development will be the establishment of two distinct job <br />and wage goal requirements. Due to the existing "Green Acres" property tax designation <br />the facility must meet more restrictive conditions. To meet the tax increment district <br />requirements the tenant will need to pay 90% of the employees of the facility a wage rate <br />of 160% of federal minimum wage ($11.60/hour). The City's Business Subsidy Policy <br />sets the wage goal at 110% of the federal minimum wage. Staff is proposing a minimum <br />job goal of 60 at this rate. Failure to meet either of the job goals would result in <br />termination of tax increment for the project. <br />The applicant will still be subject to all city fees including building permits, trunk utility <br />and park dedication requirements. <br />Project Timeline <br />Date <br />Event <br />July 5, 2016 <br />City Council Work Session <br />July 7, 2016 <br />EDAC meeting <br />July 13, 2016 <br />Planning & Zoning Board PUD Public Hearing <br />July 25, 2016 <br />City Council holds Public Hearing and considers TIF Plan <br />and TIF District <br />July 25, 2016 <br />City Council considers Rezone, Preliminary Plat <br />July 25, 2016 <br />EDA holds Public Hearing for Business Subsidy and <br />considers development contract <br />Mikaela Huot from Springsted Inc., the City's financial consultant, will be at the meeting <br />to provide an overview of TIF financing, review the TIF plan and discuss the proposed <br />project. <br />EDAC CONSIDERATION <br />Staff is requesting EDAC recommendation regarding establishment of TIF District 1-12 <br />and Proposed Business Subsidy. <br />ATTACHMENTS <br />1. Springsted Memo <br />2. Draft TIF Plan <br />3. Distribution Facility Site Plans <br />