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, Item No. 13 • Staff Report No. g7-/964 c_ Meeting Date:February 3, 1996 . Type of Business:WS WK: Work Session;PH:Public Hearing; CA:Consent Agenda;CB:Council Business City of Mounds View Staff Report To: Honorable Mayor and members of the City Council From: Bruce Kessel, Finance Director Item Title/Subject: Status of TIF Districts Date of Report: January 28, 1997 Periodically, questions have been raised relating to the status of TIF funds. It has taken some time to compile and understand data relating to the districts and their outstanding commitments. Also, there are delays in obtaining information from the County; for example, we have not received the final tax settlement for 1996 and it will be mid-February before we receive the tax capacity valuations for pay 1997 property taxes. Once this information is received, I will update my forecast template which will provide detailed information on the TIF plans for the life of the associated District(Mounds View has three districts). The attached information is being provided in general terms but should provide an overview of the TIF funds. As of December 31, 1995, the TIF Districts had a cash balance of$6,111,000 (plus funds held in . escrow to pay off bonds that had been refunded; the escrow funds are sufficient to pay of the associated debt). For 1996: the City received approximately $2,272,000 in captured tax increment and$300,000 in interest earnings. Debt service on bonded debt was $1,260,000, payments on developer notes were$192,000,payments of EDA administrative costs were $120,000, and other payments for business loans, purchase of the Bel Rae, housing for the replacement program, etc. were $976,000, for a net increase in the cash balance at the end of the year of approximately $24,000, resulting in an estimated TIF balance of$6,135,000 at year-end. In the past,the City has designated this money for various items including the subsequent year's debt service and City priorities as per the attached list. Periodically, comments are made in reference to "excess TIF"which may have different meanings to different individuals. As used in the property tax system, excess TIF refers to property taxes that are collected on a TIF property in an area that was affected by a modification to a District after a specified date above a frozen tax capacity rate. In other words, for some parcels of property,the tax capacity rate is frozen for the TIF district and any taxes generated on the difference between the frozen rate and the current rate is excess TIF which is distributed back to the three major taxing jurisdictions (City, County and School District). I believe others use the term to attempt to define what dollars are available in excess of existing obligations; this is subject to interpretation as to how to account for existing obligations and reserves for debt 41, service and proposed projects.