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City of Lino Lakes, Minnesota • Section J Findings and Need for Tax Increment Financing • In establishing the TIF District, the City makes the following findings: (1) The TIF District qualifies as an economic development district; See Section E of this document for the reasons and facts supporting this finding. (2) The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future, and the increased market value of the site that could reasonably be expected to occur without the use of tax increment would be Tess than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan; The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: The proposed development is an industrial park including various manufacturing and warehouse uses. The land in the TIF District has been vacant for many years, despite previous! efforts by the City to encourage its development (including establishment of a previous tax increment financing district that includes most of these parcels.):: The site requires sewer, water and road improvements to accommodate manufacturing and warehouse development, and the cost of those improvements may not, as a practical matter, be passed to proposed developers and users of the site, based on analysis of market conditions in Lino Lakes. In addition,' the City has reviewed a pro forma submitted by the initial proposed developer, showing that the cost of land acquisition and public improvements make the proposed development infeasible assuming customary rates of return. The increased market value of, the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan: As noted above, the site has been vacant for many years. Without installation of the improvements needed to serve the area, the City has no reason to expect that significant development would occur without assistance similar to that provided in this plan. Therefore, the City concludes as follows: a. " The city's estimate of the amount by which the market value of the site will increase without the use of tax increment financing is $0, except for a small amount attributable to appreciation in land value. b. If all development which is proposed to be assisted with tax increment were to occur in the District, the total increase in market value would be approximately $16,963,000. c. The present value of tax increments from the District for the maximum duration of the district permitted by the TIF Plan is estimated to be $1,254,113 (See Exhibit V) SPRINGSTED Page 5