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HomeMy WebLinkAbout1998-171 Council ResolutionCITY OF LINO LAKES ANOKA COUNTY STATE OF MINNESOTA Council member Neal introduced the following resolution and moved its adoption: RESOLUTION NO. 98 - 171 RESOLUTION MODIFYING TAX INCREMENT FINANCING DISTRICT NO. 1-7 AND THE ADOPTING THE MODIFICATION OF THE TAX INCREMENT FINANCING PLAN THEREFOR AND ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 1-9 WITHIN DEVELOPMENT DISTRICT NO. 1 AND ADOPTING THE TAX INCREMENT FINANCING PLAN THEREFOR. BE IT RESOLVED by the City Council (the "Council") of the City of Lino Lakes, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01. The EDA has heretofore established Development District No. 1 and adopted the Development Program therefor. It has been proposed that the City modify Tax Increment Financing District No. 1-7 ("District No. 1-7") and adopt the Modification to the Tax Increment Financing Plan therefor and establish Tax Increment Financing DistrictNo. 1-9 ("District No. 1-9") therein, and adopt the Tax Increment Financing Plan therefor (collectively, the "Plans"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.090 through 469.1081 and 469.174 through 469.179, all inclusive, as amended, all as reflected in the Plans, and presented for the Council's consideration. Generally, the Modification of District No. 1-7 is to remove 14 parcels from DistrictNo. 1-7, as listed in Appendix II -A of the Modification to the Tax Increment Financing Plan. Five of these parcels will be in Tax Increment Financing District No. 1-9 and are listed in Appendix III -C of the Tax Increment Financing Plan for District No. 1-9. 1.02. The Council has investigated the facts relating to the Plans. 1.03. The City has performed all actions required by law to be performed prior to the adoption and approval of the proposed Plans, including, but not limited to, notification of Anoka County and School District No. 12 having taxing jurisdiction over the property to be included in District No. 1-9, a review of and written comment on the Plans by the City Planning Commission, and the holding of a public hearing upon published notice as required by law. 1.04 The Council recognizes that, pursuant to Minnesota Statutes, Section 469.177, Subd. 3, clause b, there is a mandatory fiscal disparities contribution for District No. 1-9, an economic development district. N: \M innsota\LINOLAKE\TIF 1-9\city_res. wpd L L Section 2. Findings for the Adoption and Approval of the Plans. 2.01. The Council hereby finds that the Plans, are intended and, in the judgment of this Council, the effect of such actions will be, to provide an impetus for development in the public purpose and accomplish certain objectives as specified in the Plans, which are hereby incorporated herein. Section 3. Findings for the Modification of Tax Increment Financing District No. 1-7. 3.01 The Council hereby reaffirms the original findings for the Tax Increment Financing District No. 1-7 as modified herein, namely: that District No. 1-7 is in the public interest and is an "economic development district" under Minnesota Statutes, Section 469.174, subd. 12; that the proposed development would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future; that the Modification conforms to the general plans for development of Lino Lakes as a whole; and that the Modification will afford maximum opportunity, consistent with the sound needs of the community as a whole, for development of the District by private enterprise. Section 4. Findings for the Establishment of Tax Increment Financing District No. 1-9. 4.01. The Council hereby finds that Tax Increment Financing District No. 1-9 is in the public interest and is an "economic development district" under Minnesota Statutes, Section 469.174, subd. 12. 4.02. The Council further finds that the proposed development would not occur solely through private investment within the reasonably foreseeable future and that the increased market value on the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of District No. 1-9 permitted by the Tax Increment Financing Plan, that the Plans conform to the general plan for the development or redevelopment of the City as a whole; and that the Plans will afford maximum opportunity consistent with the sound needs of the City as a whole, for the development of District No. 1-9 by private enterprise. 4.03. The City elects to make a qualifying local contribution in accordance with Minnesota Statutes, Section 273.1399, subd. 6(d), in order to qualify District No. 1-9 for exemption from state aid losses set forth in Section 273.1399. 4.04. The Council further finds, declares and determines that the City made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit A. Section 5. Approval and Adoption of the Plans. 5.01. The Plans, as presented to the Council on this date, includingwithout limitation the findings and statements of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the Community Development Director. 5.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plans and to negotiate, draft, prepare and present to this Council for N:\M innsota\LINOLAKE\TIF 1-9\city_res. wpd L EXHIBIT A RESOLUTION # 98 — 171 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 1-9, ("District No. 1-9") as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that the District No. 1-9 is an economic development district as defined in M.S., Section 469.174, Subd. 12. Tax Increment Financing District No. 1-9 consist of several parcels within the City's Development District No. 1, delineated in the Plan, for the purpose of financing economic development in the City through the use of tax increment. District No. 1-9 consists of a portion of Development District No. 1 not meeting requirements for other types of tax increment financing districts, which is in the public interest because it will facilitate construction of a manufacturing facility for Midwest Veneer, H.L. Mesabi, Lino Lakes Business Center Phases 5, 6, and 7, and additional manufacturing development which will discourage commerce, industry, or manufacturing from moving their operations to another state or municipality; it will increase employment in the state, and preserve and enhance the tax base of the state. 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that 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 the market value estimated to result from the proposed development after subtracting the present value of theprojected tax increments for the maximum duration of District No. 1-9 permitted by the 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: This finding is supported by the fact that the development proposed in this plan is a manufacturing facility that meets the City's objectives for economic development. The cost of land acquisition, site and public improvements and utilities makes development of the facility infeasible without City assistance. The developers have been asked for and provided a letter as justification that the developer would not have gone forward without tax increment assistance ( see attachment in Appendix F). The increased market value of the site that could reasonable 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 Plan: The City supported this finding on the grounds that the cost of land acquisition, site and public improvements and utilities add to the total development cost. Historically, site development costs in this area have made development infeasible without tax increment assistance. This site has been marketed for at least 8 years without success. Therefore, the City reasonably determines that no other development of any kind is anticipated on this site without substantially similar assistance being provided to the development. Accordingly, the increased market value anticipated without tax increment assistance is $0. A comparative analysis of estimated market values both with and without establishment of Tax Increment Financing District No. 1-9 and the use of tax increments has been performed as described above. If all development which is proposed to be assisted with tax increment were to occur in District No. 1-9, the total N : \M innsota\ LI NOLAKE\TIF 1-9\c ity_res. wpd L., increased market value would be up to $29,641,900. The present value of tax increments from District No. 1-9 is estimated to be $2,276,967. It is the Council's finding that no development with a market value of greater than $26,254,455 would occur without tax increment assistance in this district within 9 years. This finding is based upon evidence from general past experience with the high cost of acquisition and public improvements in the general area of District No. 1-9 (see Cashflow in Appendix D). 3. Finding that the Tax Increment Financing Plan for District No. 1-9 conforms to the general plan for the development or redevelopment of the municipality as a whole. The Plan was reviewed by the Planning Commission on December 9, 1998. The Planning Commission found that the Plan conforms to the general development plan of the City. 4. Finding that the Tax Increment Financing Plan for District No. 1-9 will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development of Development District No. 1 by private enterprise. The project to be assisted by District No. 1-9 will result in increased employment in the City and the State of Minnesota, increased tax base of the State, and add a high quality development to the City. N: \M innsota\LINOLAKE\TIF 1-9\city_res. wpd its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 5.03 The Auditor of Anoka County is requested to remove the parcels from Tax Increment Financing District No. 1-7 as listed in Appendix II -A of the Modification and to adjust the base tax values accordingly. 5.04 The Auditor of Anoka County is further requested to certify the original net tax capacity of District No. 1-9, as described in the Plans, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the City of Lino Lakes is authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify, together with a list of all properties within District No. 1-9, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution. 5.05. The City is further authorized to file a copy of the Plans with the Commissioner of Revenue. The motion for the adoption of the foregoing resolution was duly seconded by Council member Bergeson , and upon a vote being taken thereon, the following voted in favor thereof: Bergeson, Dahl, Neal, Sullivan. and the following voted against the same: Council Member Lyden. Dated: December 14, 1998 (Seal) ATTEST: CLA Cit k' Clerk/Treasurer N:\Minnsota\LINOLAKE\TIFI-9\city_res. wpd