HomeMy WebLinkAboutItem 4 - cc 6 9 15 Tax Abatement Payment_Valley Cartage_2015 docx
MAYOR & COUNCIL COMMUNICATION
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DATE: June 9, 2015 CONSENT ITEM # 4 AGENDA ITEM: Approval for Tax Abatement Payment for Valley Cartage
SUBMITTED BY: Cathy Bendel, Finance Director
THROUGH: Cathy Bendel, Finance Director
REVIEWED BY: Dean Zuleger, City Administrator Kevin Corbid, Washington County SUGGESTED ORDER OF BUSINESS:
- Questions from Council to Staff ............................................. Mayor Facilitates
- Report/Presentations…………………………….……City Staff, Smith Schafer
- Questions from Council to Staff……………………………..Mayor Facilitates
- Public Input, if Appropriate………………………………….Mayor Facilitates
- Call for Motion ............................................................... Mayor & City Council
- Discussion ....................................................................... Mayor & City Council
- Action on Motion .................................................................... Mayor Facilitates
POLICY RECOMMENDER: Finance
FISCAL IMPACT: $3,628.68
On April 26, 2013, the City Council approved a limited property tax abatement for the 8665 Hudson Boulevard (Parcel ID #33.029.21.44.0037) for the tax years 2014, 2015, 2016 and 2017.
SUMMARY AND ACTION REQUESTED:
On an annual basis, by July 30th each year, the tax abatement for 8665 Hudson Boulevard needs to be remitted to the owner. Staff is seeking City Council approval to refund the City of Lake Elmo portion which needs to be refunded for 2015 which is $3,628.68.
City Council Meeting [Consent Agenda Item 4]
June 9, 2015
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STAFF REPORT:
In the winter of 2012 the City of Lake Elmo was approached by a company from Wisconsin with interest in purchasing a corporate office building at 8665 Hudson Boulevard for the purpose of establishing a headquarters and creating 50 new jobs. They requested a limited tax abatement for the years of 2014-2017.
This location was not in a TIF district so those incentives were not available. The City staff took the lead on a project to put together an economic development package that consisted of tax abatement, a sizable forgiveable loan ($500k), job training funds, and energy credits to bring new good paying jobs to the region. The results of this public-private partnership resulted in the
building being purchased and all of the stipulations of the partnership and state funding having
been exceeded. The following were the benefits as a result of this transaction:
• Valley Cartage moved their Corporate Headquarters to Lake Elmo and created in excess of 50 new jobs.
• Improvements were made to the building at 8665 Hudson Boulevard increasing the taxable market value by over $1 million.
• Retention of a large tenant a key commercial building on the I-94 corridor where the City planned for key growth.
• Participation by Washington County in the abatement process for their share of the tax increment for 2014-2017.
It should be noted that there was no tax abatement due for 2014 as a result of the delay in the improvements to the building hitting the tax roll.
RECOMMENDATION: It is recommended that the City Council approve a payment to Norman James in the amount of $3,628.68 which represents the City share of tax abatement due for 2015.
ATTACHMENTS: 1. Resolution #2013-27
2. Washington County worksheet on Lake Elmo component of 2015 tax abatement