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City Council Regular Meeting Minutes March 23, 2021 Page 2 I Ms. Stacie Kvilvang, Ehlers & Associates, reviewed the City is considering establishing the 2 Lowry Grove Tax Increment Financing District to facilitate the redevelopment of the former 3 Lowry Grove Mobile Home Park and Bremer Bank site. The last TIF District Silver Lake 4 Village was done in 2003. The District consists of 2 parcels of land as noted and adjacent and 5 internal rights-of-way and is approximately 17 acres in size. A map was provided for Council 6 review. These two parcels are combined into one TIF District. 8 Parcel number Address Owner 9 07-029-23-23-0001 2501 Lowry Ave NE The Village LLC 10 07-029-23-23-0002 2401 Lowry Ave NE Bremer Bank NA 11 12 The City has had several projects come forward over the past several years to develop the area 13 with varying forms of rental housing. All projects have requested tax increment financing in 14 order to undertake the projects. Over the last year, the City has given preliminary approval for 15 assistance to two projects in the proposed District, of which only one is moving forward at this 16 time. Based upon the historical interest in redeveloping this area, it was determined to place both 17 parcels into one larger district in order to be flexible to accommodate any future TIF requests the 18 City and HRA may deem to be warranted. 19 20 The duration of this redevelopment TIF district will be 25 years from the date of receipt of the 21 first increment, which is anticipated in 2023. It is estimated that the District, would terminate at 22 the earlier of satisfaction of payment of any pay-as-you-go TIF Notes within the District or on 23 December 31, 2048. We anticipate that the District will be decertified earlier than 2048 since 24 currently the only obligation proposed for the District should be repaid in 9 years. 25 26 Ms. Kvilvang reviewed the TIF District Criteria and the TIF District Budget. The Project and 27 Interest Costs Total is $56,528,057. This is the maximum budget and cannot be increased 28 without another Public Hearing being held. The City is approving an interfund loan (IFL) of 29 $25,000 to cover any future administrative costs associated with the District that are not covered 30 by the Developer until such time there is adequate administrative TIF (10%) generated. Any 31 funds advanced under the IFL will carry an interest rate of 4%, which is the statutory maximum 32 rate. When a TIF District is created it cannot have a negative balance. 33 34 Councilmember Randle stated he does not understand why this is being done again. Ms. 35 Kvilvang stated there is no TIF District created for these parcels. 36 37 Mayor Stille stated this provides flexibility if Council wishes to proceed with a project in the 38 future. 39 40 Councilmember Webster asked if 20% of the units being affordable when the TIF District (Silver 41 Lake Village) was created. Ms. Kvilvang stated it was not part of the TIF and was self-imposed 42 by the developers. 43 44 Councilmember Jenson stated previously we had agreed to provide TIF Assistance for the 45 Bremer Bank site. Ms. Kvilvang stated the Bremer Bank site is part of the TIF District. Ms. 46 Kvilvang stated at that time discussions were held about a TIF District for the Bremer Bank site.