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Item No: 9A Meeting Date: April 12, 2004 Type of Business: Public Hearing and CB Administrator Review: ____ City of Mounds View Staff Report To: Honorable Mayor and City Council From: Kristin Prososki, Planning Associate Item Title/Subject: Review Proposed PUD Amendment Regarding “Building N” in Mounds View Business Park Located at 5145 – 5151 Program Avenue Introduction: Bethlehem Baptist Church is requesting an amendment to the “Building N” Planned Unit Development (PUD) to add religious institution as a permitted use. This item was discussed at the April 5, 2004 work session. Bethlehem Baptist Church (BBC) has a signed purchase agreement with Michael Investments, the current owner of “Building N”. The site contains 6.89 acres and the existing building is 69,167 square feet. The building has been partially vacant since it was constructed five years ago. Although a formal PUD Agreement does not exist, Staff reports and other records indicate that the PUD is to be used as office/flex, with possible uses being office, laboratory, production, high tech assembly or storage uses. The Planning Commission discussed this request at two of their previous meetings. Although the Commission had many concerns about the financial implications, they are recommending approval from a land use perspective. Discussion: Zoning and Use Issues The Zoning Code allows religious institutions as conditional uses in residential districts. There are seven criteria that a church must meet to obtain a Conditional Use Permit. The site and existing building meet all the criteria for a Conditional Use Permit, including size, setback, parking and access. The criteria also addresses how the use fits into the comprehensive plan. The site is designated as a light industrial use in the comprehensive plan. While staff does not foresee a church having a negative impact on the surrounding properties, the proposed use is dissimilar to surrounding uses and would be inconsistent with the Comprehensive Plan and anticipated land uses within the PUD. Financial Issues There are many financial implications to consider for this request. Building N is part of Tax Increment Financing (TIF) District #1. The following is a break down of the total amount of money that is collected in taxes and administrative fees from Building N: The base tax capacity is $2,588, of which the City receives $981. For the development agreement, a “designated” base for the project was set at $22,342. The City collects 100% of the captured increment on the tax capacity between $2,588 and $22,342. The difference between the “designated” base and the base is $19,754, which is then multiplied by the tax capacity rate of 122.434%. The total captured increment collected by the City equals $24,186. The City also collects a 10% administration fee for any increment above the “designated” base of $22,342. In 2003, that amount was $5,224. Thus, if Building N were to be sold to a tax-exempt entity, the City would lose $29,410 of TIF and $981 in City taxes, for a total revenue loss of $30,391.