07/23/2001 Council Packet - Laserfiche WebLink

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• • • I. POLICY PURPOSE The purpose of this policy is to establish the City of Lino Lakes' position relating to the use of Tax Abatement, for private development above and beyond the requirements and limitations set forth by State Law. This policy shall be used as a guide in the processing and review of applications requesting tax abatement assistance. The fundamental purpose of Tax Abatement in the City of Lino Lakes is to encourage desirable development or redevelopment that would not otherwise occur but for the assistance provided through Tax Abatement. The City of Lino Lakes is granted the power to utilize Tax Abatement by the Minnesota Tax Abatement Act, as amended. It is the intent of the City to provide the minimum amount of Tax Abatement, as well as other incentives, at the shortest term required for the project to proceed. The City reserves the right to approve or reject projects on a case by case basis, taking into consideration established policies, project criteria, and demand on city services in relation to the potential benefits from the project. Meeting policy criteria does not guarantee the award of Tax Abatement to the project. Approval or denial of one project is not intended to set precedent for approval or denial of another project. H. DIFFERENCE BETWEEN TAX ABATEMENT & TAX INCREMENT FINANCING The primary difference between Tax Abatement and Tax Increment Financing (TIF) is the way in which the dollars are awarded to the project. When TIF is awarded to a project by the city, the other political subdivisions (the school district and the county) are required to contribute their portion of the increased taxes to the project. Conversely, when Tax Abatement is requested, each political subdivision has the option of granting its portion of the increased taxes to the project. Subsequently, the dollars generated for the project with Tax Abatement are generally Tess than the dollars generated with TIF. I11. OBJECTIVES OF TAX ABATEMENT As a matter of adopted policy, the City will consider using Tax Abatement to assist private development projects to achieve one or more of the following objectives: • To Provide assistance in the Town Center • To retain local jobs and/or increase the number and diversity of jobs that offer stable employment and/or attractive wages and benefits. • To enhance and diversify the City of Lino Lakes' economic base. • To encourage additional unsubsidized private development in the area, either directly or indirectly through "spin off" development. • To facilitate the development process and to achieve development on sites which would not be developed without Tax Abatement assistance. • To remove blight and /or encourage redevelopment of commercial and industrial areas in the city that result in high - quality redevelopment and private reinvestment. • To offset' increased costs of redevelopment (i.e., contaminated site clean up) over and above the costs normally incurred in development. • To create opportunities for affordable housing.