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• TAX INCREMENT FINANCING IN MINNESOTA I. PROJECTS AND DISTRICTS A. Projects. Tax increment financing is used in conjunction with underlying development and redevelopment powers. Tax increments must be spent within particular geographic areas created under the development statutes. The basic planning area is referred to as a "Project," which also has other names: City: Development District, created under Sections 469.124 to 469.134. HRA: Redevelopment Project, created under Section 469.001 to 469.147. EDA: Economic Development District, created under Section 469.090 to 469.1081, or Development District or Redevelopment Project created using City or HRA powers. PORT AUTH.: Industrial Development Districts, created under Section 469.040 to 469.068, or special legislation. 1111, All Projects require a general development or redevelopment plan, approved after a public hearing. The boundaries tend to be large areas within which the authority intends to promote development or redevelopment. B. TIF Districts. TIF Districts are the specific parcels within a Project area from which tax increment will be captured. There are five general types: 1. Redevelopment District, Section 469.174, Subd. 10. Qualifications: (a) Parcels that make up 70% of the district are improved, and more than 50% of the buildings (excluding outbuildings) are structurally substandard to a degree requiring substantial renovation or clearance. To be considered "improved," at least 15% of the parcel's area must contain improvements. A building is not substandard if it complies with building codes or could be brought up to code at a cost of less than 15% of the cost of a comparable new building on that parcel; or (b) the district consists of vacant, unused, underused, inappropriately used, or • infrequently used rail yards, rail storage facilities or excessive or vacated railroad rights-of-way. SJA100909 1 FIRM