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Casserly Molzahn & Associates, Inc. fitSuite 1100 Southpoint Office Center • 1650 West 82nd Street • Minneapolis, Minnesota 55431 Office (612) 885-1298 • Fax (612) 885-1299 MEMORANDUM TO: City of Mounds View Attn: Cathy Bennett, Economic Development Coordinator FROM: James R. Casserly RE : Tax Increment Policy DATE : July 18, 1996 I received a copy of your draft tax increment policy which you recently sent me . Enclosed you will find some basic information we have prepared to help explain tax increment financing, the different types of tax increment financing districts and some 411 issues that occur with the creation of tax increment financing districts . Please use this information if you find it helpful . I have made a quick review of your tax increment policy (the "TI Policy" ) and have the following general observations : 1 . The TI Policy appears to be concerned mainly with providing incentives and seems to have little concern with addressing need. 2 . There is very little concern with the problems of redevelopment . As is true with item 1 above, almost all of the criteria seem to address issues of economic development . 3 . There are references to assistance outside the tax increment district (but within the project area) which will be funded by the use of "Excess Increment" . From a legal point of view there is no such thing as the EDA retaining excess tax increment . 4 . While community and public service centers can be funded by tax increment, that use has been much criticized and the 1997 Legislature will most likely probibit it . 5 . Some of the rating criteria may be directly opposed to your redevelopment goals . It is very difficult in a redevelopment project to provide assistance on a pay- as-you-go approach, for example . To apply a negative