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Item No: 07B Meeting Date: November 23, 2015 Type of Business: PH & CB City of Mounds View Staff Report To: Honorable Mayor and City Council From: James Ericson, City Administrator Item Title/Subject: Resolution 8467, a Resolution Amending and Restating Resolution 4532, an Enabling Resolution Establishing the Mounds View Economic Development Authority under Minnesota Statutes, Sections 469.000 through 469.108 Introduction: During the budget review sessions with the City Council earlier this year, the City Council had expressed interest in exploring a separate EDA levy to fund the City’s economic development programs, given that the City’s three original TIF districts will have all expired by the end of this year and as a result, significantly reducing the dollars that had been collected for such purposes. This report summarizes the steps involved to create and approve an EDA levy to support such activities within the City of Mounds View. Discussion: A typical EDA levy is a levy set by a city at the request of the EDA. For example, if the City Council determines that the EDA needs an additional $43,503 to operate in the coming year, the City could increase the general fund levy by 1% and transfer the amount to the EDA. Because the EDA levy is part of the City levy, it is not a “special levy” under state law and thus the EDA levy is subject to the City’s overall levy limit. For 2016, the City’s Charter imposed levy limit is 1%, which did not leave any additional levy space to fund EDA activities. State law provides an alternative to an EDA levy as referenced above, and that would be in the form of an HRA levy. Many EDA-enabling resolutions adopt all the powers of an HRA, in addition to those of an EDA. If so, the EDA may levy a separate tax or “HRA levy,” and then the EDA functions as a special taxing district as if it were an HRA and that levy is NOT subject to levy limits or to city debt limits. An EDA using the levy powers of an HRA is limited to a levy no more than 0.01813 percent of the total taxable market value in the city. For Mounds View, that amount would allow for a maximum levy of $161,236. In researching the enabling language for the Mounds View Economic Development Authority, it was discovered that the enabling language did NOT include the adoption of those powers of an HRA. (Resolution 4532, adopted on March 28, 1994, is attached for your reference.) Thus, for the City Council to adopt an HRA levy to fund our economic development program, the enabling language would need to be amended. Resolution 8467 has been drafted by the City Attorney to accomplish the requisite updates to the EDA’s enabling language.