Agenda Packets - 2006/02/27 - Laserfiche WebLink

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Mounds View City Council February 13, 2006 Regular Meeting Page 3 received through income and sales tax, and it has been turned around and sent back to the local 1 communities to keep down property taxes. He commented that not only was that cut in the 2003-2 2004 biennium, but also a lot of state programs were cut, so cities lost state aid and had to raise 3 property taxes. He stated the LGA funds did not get to the inner ring suburbs. 4 5 Finance Director Beer stated Mounds View lost $900,000 in the last couple of years. 6 7 Senator Betzold stated that he and Representative Bernardy will be hosting a town meeting at the 8 Mounds View Community Center this Saturday from 10 a.m. to 12 p.m. and he will review 9 information, answer questions and hear from citizens. 10 11 7. COUNCIL BUSINESS 12 13 A. 7:05 p.m. Public Hearing and Consideration of a Modification to the Project 14 Plan for the Mounds View Economic Development Project and the Proposed 15 Modification of Tax Increment Financing District No. 5 16 17 Mayor Marty opened the public hearing at 7:25 p.m. 18 19 Economic Development Director Backman explained Medtronic indicated it was time and cost 20 effective for Medtronic to concurrently build Phase 1 & Phase 2 of the Medtronic CRM 21 Headquarters in Mounds View. 22 23 Economic Development Director Backman stated that Ehlers & Associates prepared the financial 24 analysis for the project modification. He stated there was an increase from 820,000 to 1.2 25 million square feet of building space, and an additional $30,400,000 in market value. He noted 26 there will be $1.7 in new tax capacity upon project completion, and an increase in the TIF note 27 from $14.8 to $22.9 million. 28 29 Economic Development Director Backman explained that Medtronic requested 95% of the 30 available tax increment from Phase 1 & Phase 2, which is the same percentage used in the 31 current agreement. He stated Medtronic anticipates using the available increment of $22.9 32 million for structured parking which will cost Medtronic $32 million. He stated Medtronic will 33 provide the City $545,000 for replacement of Well 4 or an equivalent project to ensure adequate 34 water supply and $355,000 to the City Reconstruction Fund to offset potential traffic impacts on 35 local roads due to the Medtronic project. Economic Development Director Backman stated 36 Medtronic will continue to finance development costs upfront and receive tax increments on a 37 pay as you go at the same interest rate. He noted fiscal disparities will be paid inside the district, 38 the length of the TIF district would remain the same, and noted the largest single difference is the 39 amount of costs allocated to structured parking. 40 41 Kenneth Glidden, 5240 Edgewood Drive, asked who was accelerating Phase 2. Community 42 Development Director Ericson stated the City of Mounds View did not initiate the acceleration of 43 Phase 2 into Phase 1 but, rather, the City was approached by Medtronic. 44 45