08-14-2000 EDA Packet - Laserfiche WebLink

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AGENDA ITEM 5 STAFF ORIGINATOR: Mary Alice Divine DATE: 8/14/00 TOPIC: Consideration of the Contract for Private Development between Lino Lakes EDA and CJN Investments, LLP (Twin City Fab, Inc.) VOTE REQUIRED: 3/5 BACKGROUND: This development contract outlines the conditions for public assistance to Twin City Fab for the construction of a 19,200 square foot facility on 4 acres on the G.M. Development property in the Apollo Business Center (see attached map). The total minimum market value (MMV) of the completed project will be $920,500, with an estimated tax of $41,041. In this agreement, the city agrees to provide tax increment financing totaling $77,185, which amounts to approximately 8% of the MMV. The agreement removes the assessments of $70,185 upfront, plus a $5,000 escrow, which will be returned to the company when the building is complete. The remaining pay- as-you-go TIF amount of $2,000 will be used to assist with maintenance of the native landscaping on the site. The city will be reimbursed first for the assessments and then the developer will receive the remaining increment. Estimated payback is in July 2005. This project is in TIF District 1-9, which requires a 10% local contribution ($8,749). It is the city's intent to apply the interest lost on the assessments that were deferred until development occurred as the local contribution. The business subsidy proposed for Twin City Fab, Inc. is under $100,000, and therefore does not require a public hearing under the Minnesota Business Subsidy Law. However, all subsidies of more than $25,000 require a business subsidy agreement, which is now included in the development agreements between the developer and the EDA. Twin City Fab has agreed to a wage and job goal of at least 5 new employees at a minimum starting wage of $11 /hour, plus benefits. OPTIONS: 1. Approve the contract for private development between Lino Lakes EDA and CJN Investments, LLP