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HomeMy WebLinkAbout03-24-1997 EDA PacketAGENDA ECONOMIC DEVELOPMENT AUTHORITY MONDAY MARCH 24, 1997 6:00 P.M. 1. Call to Order and Roll Call 2. Consideration of Minutes of Monday, February 10, 1997 3. Consideration of Contract for Private Development between Lino Lakes EDA and Lino Lakes Business Center Phases 2, 3, 4, 5 (Fogerty Investments) 4. Public Hearing on the Proposed sale of property in the Apollo Business Park to Lino Lakes Business Center Phases 2, 3, 4, 5 (Fogerty Investments) 4A. Consideration of Resolution No. 97-04 authorizing sale of property 4B. Consideration of Resolution No. 97-07 adopting a modified plan for Tax Increment Financing District No. 1-7 5. Consideration of Resolution No. 97-05 authorizing preparation of a modified plan for Tax Increment Financing District No. 3-1 6. Consideration of a proposed sale of Blue Heron Development Corporation property to Lakeview Development Inc. ('d�K��,� /` e,,L, 7. Consideration of the Reimbursement Agreement between Lino Lakes EDA and Northern Wholesale Supply 8. Resolution authorizing preparation of a modified program for Development District No. 1 to expand the boundaries of the district and to establish Tax Increment Financing District No. 1-8 9. Adjourn CITY OF LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY MINUTES DATE: Monday, February 10, 1997 MEMBERS PRESENT: J. Landers, C. Lyden, S. Kuether, A. Neal, J. Bergeson MEMBERS ABSENT: None OTHERS PRESENT: B. Wessel, M. Divine CONSIDERATION OF MINUTES EDA Member Neal moved to approve the minutes from the July 8, 1996 EDA meeting. EDA Member Kuether seconded the motion. Motion passed unanimously. CONSIDERATION OF ANNUAL APPOINTMENTS Mr. Wessel explained John Landers was currently EDA president, Sally Kuether was vice president and Andy Neal was treasurer. EDA Member Neal moved to reappoint the same officers for 1997. EDA Member Bergeson seconded the motion. Motion passed unanimously. Mr. Wessel recommended the EDA designate the Quad Community Press as the official EDA newspaper. EDA Member Neal moved to appoint the Quad. EDA Member Kuether seconded the motion. Motion passed unanimously. Mr. Wessel recommended the EDA designate Norwest Bank, First Bank NA, Merrill Lynch, Dain Bosworth, Juran and Moody, and Prudential Bache as the EDA Official Depositories. EDA Member moved to approve the list. EDA Member Neal seconded the motion. Motion passed unanimously. CONSIDERATION OF RESOLUTION NO. 97-01 APPROVING A REQUEST TO TRANSFER TITLE Mr. Wessel explained that the land for Progressive Engineering in the Apollo Business Park was purchased by Rush Enterprises in 1996. They would now like to transfer title into the name of Harry Chapple and his wife, Karen. The development agreement between the EDA and Rush Enterprises allows for the transfer of title with EDA approval. EDA Member Kuether moved to approve Resolution No. 97-01. EDA Member Neal seconded the motion. Motion passed unanimously. RESOLUTION NO. 97-02 AUTHORIZING PREPARATION OF A MODIFIED TAX INCREMENT FINANCING PLAN FOR TIF DISTRICT 1-7 Mr. Wessel explained to the Authority that the city has a request for TIF assistance from Fogerty Investments to build on two parcels on city -owned property in the Apollo Business Park. EDA Member Neal moved to approve Resolution No. 97-02. EDA Member Bergeson seconded the motion. Motion passed unanimously. RESOLUTION NO. 97-03 SETTING A DATE FOR A PUBLIC HEARING FOR THE SALE OF PROPERTY TO FOGERTY INVESTMENTS Mr. Wessel explained that a public hearing was required when the city proposed to sell city property in the Apollo Business Park. The resolution calls for a hearing to be scheduled on March 24, 1997 at 6 p.m. EDA Member Kuether moved to approve Resolution No. 97-03. EDA Member Neal seconded the motion. Motion passed unanimously. Mr. Neal asked about the length of leases in the Apollo Business Park. Ms. Divine stated they are generally 3-5 years. Mr. Neal asked about offering TIF assistance for commercial property in the Clearwater Creek Development Center. Mr. Wessel explained that commercial businesses do not qualify for TIF. ADJOURNMENT EDA Member Kuether moved to adjourn. EDA Member Neal seconded the motion. Motion passed unanimously. Meeting adjourned at 6:16 p.m. AGENDA ITEM 3 STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: Contract for Private Development between Lakes EDA and Lino Lakes Business Center Phases 2,3,4,5 BACKGROUND: A development contract between the EDA and Fogerty Investments outlines the conditions for public assistance and for the conveyance of city property to the company. Fogerty Investments is purchasing a 5.5-acre parcel and a 1.63-acre parcel in the Apollo Business Park. Land and assessments for both parcels total $451,290. In this agreement the EDA will provide assistance totaling $390,000, or 12% of the total project cost. A portion of the assistance ($108,900) will be paid upon issuance of the Certificate of Completion of the first two buildings toward land costs and a portion of administrative fees. The remaining assistance ($281,100) is on a phased pay-as-you-go basis to cover the remaining land costs and a portion of site preparation. In the agreement the developer receives assistance based upon performance, and forfeits a percentage of pay-as-you-go TIF for any phase that remains unbuilt by the end of 1999. OPTIONS: 1. Approve the contract for private development between Lino Lakes EDA and Lino Lakes Business Center Phases 2, 3, 4, 5 2. Return to staff for further consideration RECOMMENDATION: Option 1 AGENDA ITEM 4 STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: Public Hearing on the proposed sale of property in the Apollo Business Park to Lino Lakes Business Center Phases 2,3,4,5 BACKGROUND: Fogerty Investments is purchasing the two remaining parcels (5.5 acres and 1.63 acres) in the city -owned portion of the Apollo Business Park. The land is being purchased for $39,000 per acre, plus assessments. A public hearing is required when the city is writing down the cost of city -owned property. OPTIONS: 1. Open the public hearing 2. Continue the public hearing RECOMMENDATION: Option 1 AGENDA ITEM 4A STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: Resolution No. 97-04 authorizing the sale of property in the Apollo Business Park to Lino Lakes Business Center Phases 2,3,4,5 BACKGROUND: This resolution describes the property under consideration in the Apollo Business Park and approves the proposed sale to Fogerty Investments. Closing on the property will be scheduled for late April. OPTIONS: 1. Adopt Resolution No. 97-04 authorizing the sale of property 2. Return to staff for further consideration RECOMMENDATION: Option 1 Member introduced the following resolution and moved its adoption: LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 97-04 RESOLUTION AUTHORIZING THE SALE OF PROPERTY BE IT RESOLVED by the Lino Lakes Economic Development Authority as follows: Section 1. Recitals 1.01. The Lino Lakes Economic Development Authority (the "Authority") approved a tax increment financing plan (the "Plan") for the Tax Increment Financing District No. 1-7 (TIF District No. 1-7) on May 22, 1995. 1.02. On May 22, 1995, the City Council of the City of Lino Lakes (the "City") approved the Plan. 1.03. The EDA entered into a development agreement with Lino Lakes Business Center Phases 2, 3, 4, 5„ a Minnesota Corporation (the "Developer") whereby the EDA agreed to purchase two properties legally described on Exhibit A attached hereto ("Parcel A" and "Parcel B") from the City for $278,070 and to resell it to the Developer for $278,070 subject to the EDA's compliance with the requirements of Minnesota Statutes, section 469.105. 1.04. Pursuant to Minnesota Statutes, section 469.105, the EDA has held a public hearing on the proposed sale of the Properties to the Developer, following published notice as required by law, at which hearing all persons wishing to express an opinion were given an opportunity to do so. Section 2. Findings. 2.01. It is hereby found and determined that the sale of the Properties to the Developer is in the best interest of the EDA. 2.02. It is hereby found and determined that the sale of the Properties furthers the EDA's general plan of economic development of the community. Section 3. Authorization. 3.01. The President and Executive Director are hereby authorized and directed to execute a quit claim deed and other appropriate documents to facilitate sale of the Properties to the Developer. 3.02. The President, Executive Director, staff and consultants are hereby authorized and directed to take any and all other steps necessary or convenient in order to accomplish the sale of the Properties. Dated: , 1997. President ATTEST: Executive Director The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against same: Whereupon said resolution was declared duly passed and adopted. EXHIBIT A LEGAL DESCRIPTIONS PARCEL A: That part of Outlot A, Apollo Business Park, Anoka County, Minnesota which lies easterly of the following described Line "A" and westerly of the following described Line «B Line "A": Commencing at the Northwest corner of said Outlot A; thence on an assumed bearing of South 89 degrees 14 minutes 00 seconds East along the north line of said Outlot A for a distance of 150.00 feet to the point of beginning of the line to be described; thence South 00 degrees 02 minutes 36 seconds East 500.14 feet; thence South 44 degrees 57 minutes 24 seconds West 203.01 feet to a point on the southwesterly line of said Outlot A and there terminating. Line `B": Commencing at the Northwest corner of said Outlot A; thence on an assumed bearing of South 89 degrees 14 minutes 00 seconds East along the north line of said Outlot A for a distance of 460.00 feet to the point of beginning of the line to be described; thence South 00 degrees 02 minutes 36 seconds East 355.00 feet; thence South 26 degrees 52 minutes 56 seconds East 192.05 feet to the southeasterly line of said Outlot A and there terminating. PARCEL B: That part of Outlot B, Apollo Business Park, Anoka County, Minnesota lying southwesterly of Line A as described below and northeasterly of Line B as described below: Line A: Commencing at the most northerly corner of said Outlot B; thence on an assumed bearing of South 58 degrees 02 minutes 08 seconds West along the northwesterly line of said Outlot B a distance of 126.35 feet; thence southwesterly along said northwesterly line and along a tangential curve concave to the southeast, having a radius of 799.00 feet, a central angle of 17 degrees 50 minutes 56 seconds and an arc length of 248.91 feet; thence south 40 degrees 11 minutes 12 seconds West along said northwesterly line and tangent to said curve 337.84 feet; thence southwesterly along said northwesterly line and along a tangential curve concave to the Southeast having a radius of 799.00 feet, a central angle of 4 degrees 36 minutes 00 seconds and an arc length of 64.14 feet to a point hereinafter referred to as Point "A" to be described; thence South 49 degrees 48 minutes 48 seconds East and not tangent to said curve 295.14 feet to the southeasterly line of said Outlot B and there terminating. Line B: Commencing at Point "A" as described above; thence southwesterly along said northwesterly line of Outlot B along a non -tangential curve concave to the Southeast having a radius of 799.00 feet, a central angle of 23 degrees 48 minutes 27 seconds, an arc distance of 332.00 feet, a chord length of 329.62 feet which bears South 23 degrees 41 minutes 01 seconds West to the point of beginning of Line B; thence South 79 degrees 13 minutes 28 seconds East not tangent to said curve 236.48 feet to the southeasterly line of said Outlot B and there terminating AGENDA ITEM 4B STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: Resolution No. 97-07 adopting the modified Tax Increment Financing Plan for TIF District No. 1-7 BACKGROUND: This modified plan authorizes the public assistance as outlined in the development contract for Lino Lakes Business Center Phases 2, 3, 4, 5. Later tonight the city council will hold a public hearing and consider the adoption of the modified plan. OPTIONS: 1. Adopt Resolution No. 96-07 for the modification of the Tax Increment Financing Plan for TIF District No. 1-7 2. Return to staff for further consideration RECOMMENDATION: Option 1 Member introduced the following resolution and moved its adoption: LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 97-07 RESOLUTION ADOPTING MODIFIED TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 1-7 BE IT RESOLVED by the Lino Lakes Economic Development Authority as follows: Section 1. Recitals. 1.01. The City Council of the City of Lino Lakes (the "City") established the Lino Lakes Economic Development Authority (the "Authority") in 1990 and conferred upon it responsibility for economic development within Lino Lakes. 1.02. The City adopted a tax increment financing plan (the "Plan") for Tax Increment Financing District No. 1-7 on May 22, 1995. 1.03. In response to development proposals from Lino Lakes Business Center Phases 2, 3, 4, 5 the Authority and the City have authorized the preparation of a modified Plan which is contained in a document entitled "Modified Tax Increment Financing Plan, Tax Increment Financing District No. 1-7," dated March 24, 1997 and on file with the Authority. Section 2. Authority Approval. 2.01. The Authority finds that the objectives of the Authority and the City of encouraging development and redevelopment within Tax Increment Financing District No. 1-7 will be advanced by adoption of the modified Plan. 2.02. The modified Plan is hereby adopted by the Authority. Section 3. Further Proceedings. 3.01. It is noted that copies of the modified Plan have been transmitted to the boards of Independent School District No. 12 and Independent School District No. 834 and the board of commissioners of Anoka County for review and comment and that said public bodies have been notified of the hearing to be held on the modified Plan by the City. 3.02. The Authority requests that the City hold a public hearing on the modified Plan pursuant to Minnesota Statutes, section 469.175 as soon hereafter as is practicable and recommends that the modified Plan be approved by the City. 3.03. Upon approval of the modified Plan by the City, the Authority's executive director is authorized and directed to file a copy of the modified Plan with the Minnesota state auditor. The executive director is also authorized and directed to contact the Anoka County auditor and request that the tax capacities of the parcels added to TIF District No. 1-7 be reflected in the original tax capacity of the District. this Adopted by the Lino Lakes Economic Development Authority, Lino Lakes, Minnesota day of , 1997. John L. Landers, President ATTEST: Randall Schumacher, Executive Director The motion for the adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against same: Whereupon said resolution was declared duly passed and adopted. AGENDA ITEM 5 STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: BACKGROUND: Resolution No. 97-05 authorizing preparation of a modified Tax Increment Financing Plan for TIF District 3-1 (Clearwater Creek Development Center) The city has a request for tax increment financing assistance GNW Machine, Inc. and its sister company Uptec Automation, Inc. to build a 31,783-square foot office/manufacturing facility for its engineering/precision parts manufacturing business. The company currently has three sites in White Bear Lake, Coon Rapids and North St. Paul, and plans to consolidate. The company was established in 1979 and has 52 employees. They are purchasing a site east of Northern Wholesale in the Cc_ This resolution authorizes preparation of the modification of the plan for TIF District No. 3-1. Once the plan is prepared it will be sent to School District #624 and Anoka County for review. Later tonight the City Council will be asked to set a date for a public hearing. OPTIONS: 1. Adopt Resolution No. 97-05 authorizing preparation of a modified tax increment financing plan for TIF District No. 3-1 2. Return to staff for further consideration. RECOMMENDATION: Option 1 Member introduced the following resolution and moved its adoption: LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO.97-05 RESOLUTION AUTHORIZING PREPARATION OF A MODIFIED TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 3-1 WHEREAS, on June 29, 1995 the city council of the City of Lino Lakes (the "City") established Tax Increment Financing District No. 3-1 ("TIF District No. 3-1") in order to promote development within areas of the community which have not developed solely through private efforts in a manner which is consistent with their prominence; and WHEREAS, it has been necessary to amend the Plan for the TIF District No. 3-1 in the past in order to assist development and to achieve the purposes for which TIF District No. 3-1 was established; and WHEREAS, it has been proposed that the TIF Plan be modified again to assist an industrial facility pursuant to Minnesota Statutes, sections 469.174 through 469.179 (the "TIF Act"). NOW, THEREFORE, BE IT RESOLVED by the Lino Lakes Economic Development Authority (the "EDA") as follows: 1. Staff and Kennedy & Graven, Chartered are hereby authorized and directed to prepare a modified tax increment financing Plan (the "Plan") for TIF District No. 3-1. 2. The executive director of the EDA is authorized and directed to schedule a meeting on April 28, 1997 at 6 p.m. in the council chambers at city hall, at which time the EDA will consider adoption of the modified Plan for TIF District No. 3-1. 3. The staff and consultants are authorized and directed to take any and all steps necessary to bring the modified Plan before the EDA at the April 28, 1997 meeting. 4. The City is urged to schedule a public hearing on the modified Plan to be held as soon after consideration of these matters by the EDA as reasonably possible. Dated: March 24, 1997 President ATTEST: Executive Director The motion for adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against same: Whereupon said resolution was declared duly passed and adopted. AGENDA ITEM 6 STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: Consideration of a proposed sale of Blue Heron Development Corporation property to Lakeview Development Inc. BACKGROUND: Blue Heron Development Corporation entered into a development agreement with the Lino Lakes EDA on July 14, 1995 to build a 20,000-square foot facility in the Apollo Business Center for lease to light industrial users. The company built in 1996 and has a temporary Certificate of Completion but does not have a final Certificate of Completion because landscaping was not completed. The development agreement states that the EDA must approve a transfer of title if a Certificate of Completion for the minimum improvements has not been issued. The owner now wishes to sell the property to Bill Dubats of Lakeview Development Inc. Mr. Dubats has requested approval by the EDA to transfer title. The title company will hold $15,000 in escrow to ensure completion of the landscaping. Mr. Dubats has agreed to complete the minimum improvements within 90 days of the closing, and has also indicated he plans to improve the color scheme of the building. OPTIONS: 1. Approve the transfer of title from Blue Heron Development Corporation to Lakeview Development Inc. of Minnesota 2. Return to staff for further consideration RECOMMENDATION: Option 1 Lakeview Development Inc. of MN March 14, 1997 Lino Lakes Economic Development Authority Attention: Mary Divine 1189 Main St Lino Lakes, Minnesota 55014 Subject: Contract for Private Development by and Between Lino Lakes Economic Development Authority and Blue Heron Development Corporation of 7/14/95 Enclosure: Purchase Agreement for property at 375 Apollo Drive, Lino Lakes (pp 1-4, 19-21) Members of the Economic Development Authority, The subject Contract provides a broad agreement on provisions under which development of the real estate at 375 Apollo Business Center were to proceed. As you know, Section 3.3 of said agreement calls for project completion by December 31, 1995. To date, landscaping has not been completed by developer Blue Heron/Dan Richmann. Accordingly, the City of Lino Lakes has not issued a Certificate of Completion for the Minimum Improvements set forth in said Contract. The purpose of this memo is to request a waiver to a single provision of Subject Contract. I have entered into a purchase agreement to buy this property, and have subsequently noted that ARTICLE VII, Section 7.1 prohibits such sale prior to issuance of a Certificate of Completion. The transfer of said property to the undersigned will expedite completion of the project. I plan to purchase the property for cash, with provisions to escrow funds for completion. We request approval for the proposed sale/purchase of the property at 375 Apollo. If members of the Economic Development Authority grant approval for this transfer, as provided for on page 11, Section 7.1(b), the undersigned promises the following with respect to the 375 Apollo property: 1. Sufficient funds will be placed in escrow at closing to protect the City's interests by insuring that the Minimum Improvements will be completed. Note that Section XXI of the enclosed purchase agreement requires approval of the Lino Lakes Economic Development Authority prior to disbursement of funds, and 2. The undersigned personally promises that improvements will be completed within 90 days of closing, and 3. The awful color scheme of the building at 375 Apollo will be improved considerably! 6740 NW Hwy 10 Office (612) 757-0122 Anoka, MN 55303 Fax (612) 757-3079 In view of the foregoing, we believe the City's interests are protected, and the granting approval of this sale is reasonable. My track record of "performance as promised" may be verified with officials of the City of Ramsey. We developed Anoka Self Storage, a mini storage facility consisting of 9 buildings with 50,000 net rentable square feet, in three phases. We believe that Ramsey Zoning Administrator Silvia Frolik and others at the Ramsey City offices would agree that all three commercial building project phases (1986, 1988, 1994) were completed exactly as agreed to. In addition, since purchasing the office/warehouse property at 6740 NW Hwy 10 in Ramsey, we have made substantial improvements in the appearance and condition of that property. As 30 year residents of Anoka County, and District Governor Elect of this Lions District, we view our reputation as our most important asset. Unfortunately, I am unable to meet with you personally at your meeting of March 24, 1997. A speaking engagement made many weeks ago has me in Big Lake that evening. I trust that Jan will be able to resolve any issues which may arise. Feel free to contact the undersigned if questions should arise in the interim. AGENDA ITEM 7 STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: Consideration of a Reimbursement Agreement between the Lino Lakes EDA and Northern Wholesale Supply BACKGROUND: The development agreement between the EDA and Northern Wholesale calls for a Reimbursement Agreement to be executed by the EDA for reimbursement of $45,000 in site preparation costs. The company has provided verification of costs incurred for site preparation and has requested reimbursement. OPTIONS: 1. Approve the execution of a Reimbursement Agreement with Northern Wholesale 2. Return to staff for further consideration RECOMMENDATION: Option 1 REIMBURSEMENT AGREEMENT THIS AGREEMENT is made and entered into as of the day of , 1997, by and between the Lino Lakes Economic Development Authority, a public body corporate and politic under the laws of Minnesota (the "Authority") and Nicholas Gargaro and Deborah Gargaro, husband and wife (the "Developer"). WITNESSETH: WHEREAS, the parties hereto did on the day of , 1996, enter into that certain document entitled "Contract for Private Development" (the "Agreement"); and WHEREAS, the Agreement provided that the Developer would construct a 100,000 square foot warehouse facility on the land legally described on Exhibit A attached hereto (the "Property"); and WHEREAS, the Developer has incurred certain expenses in correcting the soils, preparing the site and otherwise making the Property suitable for development, which expenses are collectively known as the Site Preparation Costs; and WHEREAS, the Authority agreed to reimburse the Developer for its actual and reasonable expenditures for the Site Preparation Costs, partially at the time of issuance of the Certificate of Completion and partially from Available Tax Increment; and WHEREAS, in order to secure such payments, the Agreement requires that the Authority and Developer enter into this Reimbursement Agreement; NOW, THEREFORE, in consideration of the mutual obligations of the parties contained in the Agreement and in this Reimbursement Agreement, the parties agree as follows: Section 1. Definitions. Unless the contrary clearly appears from the context, the terms used in this Reimbursement Agreement shall have the same meanings as given them in the Agreement. Section 2. Repayment Amount. Subject to the limitations contained herein, the Authority agrees to reimburse the Developer for the Developer's actual and reasonable expenses associated with the Site Preparation Costs. The Authority's maximum obligation with regard to the Site Preparation Costs is $70,000. Notwithstanding anything herein to the contrary, the Authority shall not be obligated to reimburse the Developer for any of the Site Preparation Costs until the Developer has submitted evidence deemed reasonably satisfactory to the Authority of the Developer's actual and reasonable expenditures for the Site Preparation Costs. Section 3. Timing of Payments. (a) Following issuance of the Certificate of Completion and after receipt of satisfactory evidence regarding the Developer's expenditures for the Site Preparation Costs, the Authority will reimburse the Developer for up to $45,000 of the Site Preparation Costs. RHB116867 LN140-47 1 (b) The Authority shall reimburse the Developer for the remaining Site Preparation Costs, up to a maximum total of $70,000, starting in the year in which the Authority receives Available Tax Increment. It is anticipated that the Authority will begin to receive Available Tax Increment in 1998. Payments shall be made to the Developer on approximately July 31 and December 31 of each year, but in any event not more than 30 days following the date on which the Authority receives Available Tax Increment in its semi-annual tax settlement from the County. Subject to the Authority's right to prepay or the Authority's satisfaction of its obligation hereunder at an earlier date, the Authority shall make payments to the Developer until the Termination Date. The Authority shall not be obligated to pay the Developer under this Reimbursement Agreement in any year in which there exists no Available Tax Increment. Section 4. Prepayment. The Authority may prepay without penalty all or part of the amount due under this Reimbursement Agreement at any time. Upon such payment, the Authority shall have no further obligation to make payments to the Developer. Section 5. Limit of Obligation. The Developer understands and agrees that the reimbursement obligation of the Authority for the Site Preparation Costs above $45,000 and up to a maximum amount of $70,000 is limited to the Available Tax Increment generated prior to the Termination Date. Depending upon the amount of Available Tax Increment, the parties recognize that there may not be sufficient Available Tax Increment prior to the Termination Date to reimburse all of the Site Preparation Costs. Failure by the Developer or its successors or assigns to pay real estate taxes due on the Minimum Improvements may reduce or eliminate the Authority's obligation under this Reimbursement Agreement. The Developer further understands and agrees that the Authority's obligation hereunder is a revenue obligation only, payable solely from Available Tax Increment. Failure by the Authority to make a payment to the Developer under this Reimbursement Agreement due to a lack of Available Tax Increment shall not constitute an Event of Default under the Agreement or this Reimbursement Agreement. Section 6. Exclusive Obligation. This Reimbursement Agreement constitutes the sole and exclusive obligation of the Authority to make and the sole and exclusive right of the Developer to receive reimbursement for that portion of the Site Preparation Costs above $45,000 and up to a maximum amount of $70,000. The Developer further acknowledges that it has no other or further remedy against the Authority to enforce collection thereof. Section 7. Nature of Obligation. The parties acknowledge and understand that the financial and other commitments made in this Reimbursement Agreement constitute an obligation within the meaning of Minnesota Statutes, Chapter 475 and Section 103 of the United States Internal Revenue Code of 1986. RHB116867 LN140-47 2 IN TESTIMONY WHEREOF, the parties hereto have caused this Reimbursement Agreement to be duly executed as of the day and year first above written. DEVELOPERS LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY By By Nicholas Gargaro Its President By By Deborah Gargaro Its Executive Director STATE OF MINNESOTA ) ) SS COUNTY OF ) The foregoing instrument as acknowledged before me this day of , 1997, by John L. Landers and Randall Schumacher, the President and Executive Director, respectively, of the Lino Lakes Economic Development Authority, a public body politic and corporate under the laws of Minnesota, on behalf of the Economic Development Authority. Notary Public STATE OF MINNESOTA ) ) ss COUNTY OF ) The foregoing instrument was executed this day of , 1997, by Nicholas Gargaro and Deborah Gargaro, husband and wife. RHB116867 LN140-47 3 Notary Public PROPERTY LEGAL DESCRIPTION: RHB116867 LN140-47 EXHIBIT A to the Reimbursement Agreement The Southwest Quarter of the Southwest Quarter of the Southeast Quarter (SW1/4 of SW1/4 of SE1/4) of Section Twenty -Four (24), Township Thirty -One North (31N), Range Twenty -Two West (22W), Anoka County, Minnesota, except the North Sixty -Five (65) feet thereof. Subject to Cedar Street and County Road No. 84. AND The West Two Hundred (200) feet of the Southeast Quarter of the Southwest Quarter of the Southeast Quarter (SE1/4 of SW1/4 of SE1/4) of Section Twenty -Four (24), Township Thirty -One North (31N.), Range Twenty -Two West (22W.), Anoka County, Minnesota, except the North Sixty -Five (65) feet thereof. Subject to Cedar Street. 4 AGENDA ITEM 8 STAFF ORIGINATOR: Brian Wessel DATE: 3/24/97 TOPIC: BACKGROUND: Resolution No. 97-06 authorizing preparation of a modified program for Development District No. 1 to expand the boundaries of the district and to establish Tax Increment Financing District No. 1-8 To be prepared for redevelopment proposals that are pending in three different areas of the city, this resolution authorizes the city's bond consultant to prepare a plan that expands the city's Development District within which TIF Districts are allowed. It also authorizes preparation of a plan to establish a new TIF Redevelopment District. The purpose of this Redevelopment District is to enable the city to offer assistance if appropriate to projects that meet the criteria for redevelopment. At this time potential sites include: 1) the old church site in the Village where Fairview Hospitals is proposing to build a clinic; 2) The 49 Club site for rebuilding a portion of the restaurant that has structural damage; and 3) the Kaiser property which the city intends to sell for commercial redevelopment. Once the EDA authorizes preparation of this plan it will be prepared and sent to School District #12 and Anoka County for review. Later tonight the City Council will be asked to set a date for a public hearing. OPTIONS: 1. Adopt Resolution No. 97-06 authorizing preparation of a modified program for Development District No. 1 to expand the boundaries of the district and to establish Tax Increment Financing District No. 1-8 2. Return to staff for further consideration. RECOMMENDATION: Option 1 Member adoption: introduced the following resolution and moved its LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. 97-06 RESOLUTION AUTHORIZING PREPARATION OF A MODIFIED PROGRAM FOR DEVELOPMENT DISTRICT NO. 1 TO EXPAND THE BOUNDARIES OF THE DISTRICT AND TO ESTABLISH TAX INCREMENT FINANCING DISTRICT NO. 1-8 WHEREAS, on January 26, 1987 the city council of the City of Lino Lakes (the "City") established Development District No. 1("Development District"); and WHEREAS, the City established the Development District in order to promote development within areas of the community which have not developed solely through private efforts in a manner which is consistent with their prominence; and WHEREAS, it has been proposed that the Development District Program be modified to expand the boundaries and Tax Increment Financing District No. 1-8 be established to assist improvements within the Development District pursuant to Minnesota Statutes, sections 469.174 through 469.179 (the "TIF Act") and sections 469.124 through 469.134 (the "City Development District Act"); and WHEREAS, the City has transferred authority for the Development District and TIF Districts therein to the Lino Lakes Economic Development Authority (the "EDA"); NOW, THEREFORE, BE IT RESOLVED by the EDA as follows: 1. Staff and Kennedy & Graven, Chartered are hereby authorized and directed to prepare a modified development district program (the "Program") for Development District No. 1 and establish a Tax Increment Financing Plan (the "Plan") for TIF District No. 1-8. 2. The executive director of the EDA is authorized and directed to schedule a meeting on April 28, 1997 at 6 p.m. in the council chambers at city hall, at which time the EDA will consider adoption of the modified Program for Development District No. 1 and the Plan for TIF District No. 1-8. 3. The staff and consultants are authorized and directed to take any and all steps necessary to bring the modified Program and Plan before the EDA at the April 28, 1997 meeting. 4. The City is urged to schedule a public hearing on the modified Program and Plan to be held as soon after consideration of these matters by the EDA as reasonably possible. Dated: March 24, 1997 John L. Landers, President ATTEST: Randall Schumacher, Executive Director The motion for adoption of the foregoing resolution was duly seconded by member and upon vote being taken thereon, the following voted in favor thereof: and the following voted against same: Whereupon said resolution was declared duly passed and adopted.