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PUD Amendment Report Building N March 3, 2004 Page 4 had similar requests and if they allow churches in commercial and/or industrial districts. Staff found that many of the surrounding cities, such as Blaine, Brooklyn Center, Arden Hills and St. Anthony, have a code similar to Mounds View, whereby churches are permitted in residential districts only. Staff also found that many of the metro area cities including, New Brighton, Brooklyn Center, Maplewood, Minneapolis, Burnsville and Apple Valley do allow churches in commercial districts, usually as a conditional use. Staff was aware of a situation in the City of Brooklyn Park where a church moved into an industrial district. The City and the church have a service charge agreement. The agreement is based on the assessed value of the building. Staff contacted many of the cities that allow churches in commercial and industrial districts to ask if they too have similar service charge agreements. Staff could not find a similar arrangement among the other cities. “Building N” is part of Tax Increment Financing (TIF) District #1. The Development Assistance Agreement between the Mounds View Economic Development Authority and Michael Investments was signed on April 26, 1999. Under the current TIF note, the City receives 10% of the increment generated, which currently equals $5,223.80. If BBC were to purchase the property, the TIF note would be assigned to them. Being that BBC is a non-profit entity, the City would eliminate the note and would receive no money because there are no taxes generated. The existing TIF agreement ends in 2014, at which point the City would receive it’s full share of the taxes generated by “Building N”. If levy limits are still in place in 2014, the City would not actually see an increase in the budget, but other properties within the City would see a decrease in taxes. If BBC were to purchase “Building N”, the City would not receive any payment and other properties within the City would maintain their current level of taxes. Staff discovered that the City of Minneapolis is currently going through a very similar situation as Mounds View. Minneapolis recently had a developer sell a building located in a TIF district to a non-profit entity. After discussion within the City of Minneapolis as to how to deal with the situation, they came to the conclusion that they would do nothing. They considered establishing a service charge agreement or a payment in lieu of taxes, but ultimately decided against it because they felt that it would be considered unfair to single one non-profit out to make payments, while the other non-profits within the city are not obligated to do so. The difference between Minneapolis’s situation and Mounds View’s situation is that Minneapolis had no choice in allowing the non-profit to locate in the TIF district. In our situation, a church is currently not a permitted use within its proposed location. Staff has had discussions with representatives of BBC regarding a possible service agreement or payment in lieu of taxes between the church and the City. The church elders have approved the creation of an annual $25,000.00 Mounds View Service Project Fund. (See Attachment #7) Impact to Potential Future Uses Under Chapter 500 of the Municipal Code, allowing a church to locate in “Building N” would restrict buildings within five hundred feet from obtaining an intoxicating liquor license. Section 502. 04 Subdivision 2(c) states that a license will not be granted to a building within five hundred feet of a church or school unless the business receives 60% or more of it’s annual gross sales revenue from food sales. Attachment five of this report shows the buildings that would be affected by the five