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Mounds View EDA April 22, 2002 Regular Meeting Page 2 8. EDA BUSINESS A. Presentation of Mounds View Tax Increment Financing Cash Flow Analysis by Shelly Eldridge, Ehlers & Associates, Inc. Economic Development Coordinator Backman indicated that Staff had determined it would be prudent to have a cash flow analysis on the existing three TIF districts to provide insight into the ability for the districts to produce revenue until they are decertified. Ms. Eldridge reviewed her memo with the Economic Development Authority. She then commented that with the recent legislative changes the TIF districts would be producing 40% less tax increment. Ms. Eldridge noted there are three outstanding bonds, one to be paid off this year and the other two to be paid off in 2004. Ms. Eldridge reviewed the three existing TIF districts with the EDA. Ms. Eldridge indicated the Mermaid is a self-supporting project and was listed separately in the memo. She then said the bad news is that in 2002 there will be a deficit bond being paid off and increments will be down 35%. The good news is the City has the ability to transfer over non- defined TIF from the TIF pool to take care of the short-term shortfall. Ms. Eldridge indicated that once the bonds are paid off in 2005 the EDA would need to decide whether to require pay as you go projects. She also noted the City has the option of decertifying all the parcels to get those back in the City’s tax base. Commissioner Marty asked for clarification of the shortfall for 2002. Ms. Eldridge confirmed that there would be a half million dollar shortfall for 2002 but reminded the EDA that there are funds available to cover the shortfall. Commissioner Marty commented he would like to see as many parcels decertified as possible but asked whether there is concern about the compression of taxes. Ms. Eldridge explained that the districts have obligations through 2005 so the districts cannot be decertified until those bonds are paid off. She then said when the bonds are paid off the City would need to determine how to proceed. President Sonterre asked Staff whether there are potential projects that the City should be aware of.