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HomeMy WebLinkAboutResolution 8921CITY OF MOUNDS VIEW RAMSEY COUNTY STATE OF MINNESOTA Council member .,� introduced the following resolution and moved its adoption RESOLUTION NO. 8921 RESOLUTION ADOPTING A MODIFICATION TO THE REDEVELOPMENT PLAN FOR THE MOUNDS VIEW ECONOMIC DEVELOPMENT PROJECT AND ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 1-6 THEREIN AND ADOPTING A TAX INCREMENT FINANCING PLAN THEREFOR. BE IT RESOLVED by the City Council (the "Council") of the City of Mounds View, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01. The Board of Commissioners of the Mounds View Economic Development Authority (the "EDA") has heretofore established the Mounds View Economic Development Project and adopted a Redevelopment Plan therefor. It has been proposed by the EDA and the City that the City adopt a Modification to the Redevelopment Plan for the Mounds View Economic Development Project (the "Redevelopment Plan Modification") and establish Tax Increment Financing District No. 1-6 (the "District") therein and adopt a Tax Increment Financing Plan (the "TIF Plan") therefor (the Redevelopment Plan Modification and the TIF Plan are referred to collectively herein as the "Plans"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.090 to 469.1082 and Sections 469.174 to 469.1794, all inclusive, as amended, (the "Act") all as reflected in the Plans, and presented for the Council's consideration. 1.02. The EDA and City have investigated the facts relating to the Plans and have caused the Plans to be prepared. 1.03. The EDA and City have performed all actions required by law to be performed prior to the establishment of the District and the adoption and approval of the proposed Plans, including, but not limited to, notification of Ramsey County and Independent School District No. 621 having taxing jurisdiction over the property to be included in the District, a review of and written comment on the Plans by the City Planning Commission, approval of the Plans by the EDA on March 12, 2018, and the holding of a public hearing upon published notice as required by law. 1.04. Certain written reports (the "Reports") relating to the Plans and to the activities contemplated therein have heretofore been prepared by staff and consultants and submitted to the Council and/or made a part of the City files and proceedings on the Plans. The Reports include data, information and/or substantiation constituting or relating to the basis for the other findings and determinations made in this resolution. The Council hereby confirms, ratifies and adopts the Reports, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. 1.05. The City is not modifying the boundaries of the Mounds View Economic Development Project, but is however, modifying the Redevelopment Plan therefor. Section 2. Findings for the Adoption and Auoroval of the Redevelomnent Plan Modification 2.01. The Council approves the Redevelopment Plan Modification, and specifically finds that: (a) the land within the Project Area would not be available for redevelopment without the financial aid to be sought under this Redevelopment Plan; (b) the Redevelopment Plan, as modified, will afford maximmn opportunity, consistent with the needs of the City as a whole, for the development of the Project Area by private enterprise; and (c) that the Redevelopment Plan, as modified, conforms to the general plan for the development of the City as a whole. Section 3. Findings for the Establishment of Tax Increment Financing District No. 1-6. 3.01. The Council hereby finds that Tax Increment Financing District No. 1-6 is in the public interest and is a "housing district" under Minnesota Statutes, Section 469.174, Subd. 1 I of the Act. 3.02. The Council further finds that the proposed development would not occur solely through private investment within the reasonably foreseeable future, that the Plans conform to the general plan for the development or redevelopment of the City as a whole; and that the Plans will afford maximum opportunity consistent with the sound needs of the City as a whole, for the development or redevelopment of the District by private enterprise. 3.03. The Council further finds, declares and determines that the City made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit A. Section 4. Public Purpose 4.01. The adoption of the Plans conform in all respects to the requirements of the Act and will help fulfill a need to develop an area of the City which is already built up, to provide housing opportunities, to improve the tax base and to improve the general economy of the State and thereby serves a public purpose. For the reasons described in Exhibit A, the City believes these benefits directly derive from the tax increment assistance provided under the TIF Plan. A private developer will receive only the assistance needed to make this development financially feasible. As such, any private benefits received by a developer are incidental and do not outweigh the primary public benefits. Section 5. Approval and Adoption of the Plans. 5.01. The Plans, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the City Administrator. 5.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plans and to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 5.03 The Auditor of Ramsey County is requested to certify the original net tax capacity of the District, as described in the Plans, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the EDA is authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify, together with a list of all properties within the District, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution. 5.04. The City Administrator is further authorized and directed to file a copy of the Plans with the Commissioner of the Minnesota Department of Revenue and the Office of the State Auditor pursuant to Minnesota Statutes 469.175, Subd. 4a. The motion for the adoption of the foregoing resolution was duly seconded by Council member kyU,P-h I A r, f,et, and upon a vote being taken thereon, the following voted in favor thereof: and the following voted against the same: Dated; March 12, 2018 - Mayor ATTEST: Ci Admi istrator EXHIBIT A RESOLUTION NO. 8921 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 1-6, as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that Tax Increment Financing District No. 1-6 is a housing district as defined in MS, Section 469.174, Subd. 11. TIF District No. 1-6 consists of 4 parcels. The development will consist of 60 units of affordable workforce rental housing. All or a portion of which will receive tax increment assistance and will meet income restrictions described in MS. 469.1761. At least 40 percent of the units/homes receiving assistance will have incomes at or below 60 percent of statewide median income. Appendix E of the TIF Plan contains background for the above finding. 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable futtire: This finding is supported by the fact that the development proposed in this plan is a housing district that meets the City's objectives for development and redevelopment. The cost of land acquisition, site and public improvements and construction makes this housing development infeasible without City assistance. The cost of land acquisition and construction are approximately the same for workforce housing developments as they are for market rate projects. However, with decreased rental income from the affordable workforce housing units, there is insufficient cash flow to provide a sufficient rate of return, pay operating expenses, and service the debt. This leaves a gap in the funding for the project and makes this housing development feasible only through assistance, in part, from tax increment financing. The developer evidenced this need by providing a letter and a detailed pro forma as justification that the project would not have gone forward without tax increment assistance. The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan: This finding isjustified on the grounds that the costs of acquisition, building demolition, site improvements, utility improvements and construction of affordable housing add to the total redevelopment cost. Historically, the costs of site and public improvements as well as reduced rents required for workforce housing in the City have made development infeasible without tax increment assistance. The City reasonably determines that no other development of similar scope is anticipated on this site without substantially similar assistance being provided to the development. 3. Finding that the TIF Plan for Tax Increment Financing District No. 1-6 conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission reviewed the TIF Plan and found that the TIF Plan conforms to the general development plan of the City. 4. Finding that the TIF Plan for Tax Increment Financing District No. 1-6 will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Mounds View Economic Development Project by private enter prise. Through the implementation of the TIF Plan, the EDA or City will provide an impetus for residential development, which is desirable or necessary for increased population and an increased need for life -cycle housing within the City.