02/07/2011 Council Packet - Laserfiche WebLink

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The City and EDA subsequently provided three significant types of financing for this effort: 1. $5,500,000 Taxable General Obligation Improvement Bonds, Series 2005A (the "TIF Bonds "), to finance streets, sewer and water for the Property. These bonds are payable primarily from special assessments levied against the Property. 2. $4,215,000 General Obligation Tax Increment Bonds, Series 2007A (the "Improvement Bonds ") to finance improvements to the County Road 23 /Interstate 35W interchange, which were needed to accommodate the new development. These bonds are payable primarily with tax increments from TIF District No. 1- 11. Tax increments from TIF District No. 1 -10 are also pledged to pay part of the debt service on these TIF Bonds. 3. Tax increment assistance for a portion of the cost of acquiring the Property (through a combination of interfund loans and "pay as you go" assistance to the private developer). In addition the Metropolitan Council provided more than $1,600,000 million in grants for various aspects of the redevelopment, and Anoka County provided a $150,000 grant for the development of a YMCA on the site. Impact of Recession The City completed the infrastructure and interchange improvements, and a portion of the Property was developed for various uses (a hotel, a 60 -unit affordable rental housing project, and a new YMCA). But development stalled in the face of the severe recession. The remaining 22 acres of the Property were foreclosed by the developer's lender. After exhausting efforts to find new users or developers, the lender abandoned the foreclosed property, and that property was tax - forfeited in the summer of 2010. The City is now in discussions with Anoka County about possible acquisition of the tax - forfeited parcels. The result is that the City has outstanding bonds secured by either special assessments or tax increments, in the aggregate amount of $7,840,000, and limited revenues to pay those obligations. Proposed Legislation Staff has met with Anoka County Board Chair Rhonda Sivarajah and is arranging a meeting with local state senators and representatives to request that a legislator bring forward the special legislation. Commissioner Sivarajah is looking into the process for getting a letter of support from the Anoka County Board. The proposed legislation includes the following provisions: