04-12-1999 EDA Packet - Laserfiche WebLink

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AGENDA ITEM 3 STAFF ORIGINATOR: Brian Wessel DATE: 4/12/99 TOPIC: Consideration of the Contract for Private Development between Lino Lakes EDA and Lino Lakes Business Center Phases 5, 6, 7 & 8 BACKGROUND: This development contract outlines the conditions for public assistance to Lino Lakes Business Center (Bill Fogerty) for the construction of four additional Tight industrial leasable buildings. The site is six acres formerly owned by Hawkins Chemical (see attached map). The developer plans to build a total of 84,200 square feet by the end of next year. The total minimum market value (MMV) of the completed project will be $3,329,500. The earlier phases of the Lino Lakes Business Center have provided approximately $4 million in additional tax base to the city. They have also attracted excellent companies and good paying jobs to the business park, as well as provided facilities for existing businesses to grow and stay within the city. In this agreement, the city agrees to provide a maximum amount of tax increment financing totaling $532,720, which amounts to 16% of the MMV. The agreement removes the assessments of $131,488 upfront, and the remaining TIF will be provided on a pay-as-you-go basis to pay for the cost of land and some site preparation and landscaping. The city will be reimbursed first for the assessments and then the developer will receive the remaining increment. Estimated payback is in 2007. The developer was required to submit a $20,000 escrow which is refundable in increments as the buildings are constructed. In the event all four buildings are not complete by the end of 2000, the developer loses the escrow for uncompleted buildings, and will not be reimbursed for any site preparation costs. This project is in the new TIF District 1-9, which requires a 10% local contribution ($53,272) from the city's general fund. This contribution will be reviewed annually, as there are a number of options available as the city's local contribution. OPTIONS: 1. Ape h contract for private devIopment between Lino Lakes EDA and tract Hardware (McLad, LLP)