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December 12, 2011 <br />Mounds View Business Toolbox <br />Page 8 of 9 <br />How does the program work? <br />The City’s Economic Development Authority, in partnership with local banks, will <br />provide improvement loans to existing Mounds View businesses at a minimum of <br />$10,000 and a maximum of $50,000. The City participates by providing only half <br />of the loan amount at a 2% interest rate. <br /> <br /> 6) Tax Rebate Financing (TRF) <br />The City of Mounds View has adopted the attached policy (see Appendix C) <br />pertaining to Tax Rebate Financing (also known as Tax Abatement). An <br />abatement is a property tax repayment rather than an exemption from paying <br />property taxes. It is a method to finance up-front costs and provide additional <br />equity to a development or to finance a public improvement. For eligible <br />redevelopment and development projects, all or a portion of City real estate taxes <br />can be rebated for up to 15 or 20 years. Ramsey County and the Mounds View <br />School District can also rebate all or a portion of their share of real estate taxes. <br />If all three taxing jurisdictions participate, taxes may be rebated up to 20 years. <br /> <br />Purpose: <br />The fundamental purpose of Tax Rebate Financing in Mounds View is to <br />encourage desirable development or redevelopment that would not otherwise <br />occur but for the assistance provided. <br /> <br />Who can apply? <br />Any developer or business owner with a facility or property located in Mounds <br />View, or any developer or business owner intending to construct a facility in <br />Mounds View. <br /> <br />How does the program work? <br />The developer or business owner completes a Tax Rebate Financing (TRF) <br />application and submits the application and the required $1,000 application fee to <br />the City’s Community Development Department. Economic Development staff <br />reviews and analyzes the information and presents it to the City’s Economic <br />Development Authority. The maximum applicants may abate is $200,000 per <br />year or up to 10% of the City’s levy. There is no minimum abatement or rebate. <br /> <br />7) Tax Increment Financing (TIF) <br />The City of Mounds View has adopted the attached policy (see Appendix D) <br />pertaining to Tax Increment Financing (TIF). TIF is considered the premier tool <br />for economic development in Minnesota. Since 1986 the biggest single <br />development program in the City of Mounds View’s Toolbox has been the use of <br />Tax Increment Financing (TIF). TIF, in brief, is the ability to capture and use all <br />increased local property tax revenues from new development within a defined <br />geographic area. TIF payments to developers can be used for eligible uses, <br />such as land acquisition, demolition, utilities, parking, relocation, administration, <br />etc. There are different types of TIF districts, including redevelopment, economic <br />development, housing, and soils condition districts. Mounds View currently has <br />four tax increment financing districts—three redevelopment districts and one <br />economic development district.