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HomeMy WebLinkAboutCity Council Resolution 1998-541CITY OF PLYMOUTH, MINNESOTA Resolution No. 98-541 RESOLUTION ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 7-5A, AND APPROVING AND ADOPTING THE TAX INCREMENT FINANCING PLAN RELATED THERETO BE IT RESOLVED by the City Council (the "Council') of the City of Plymouth, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01. It has been proposed that the City establish Tax Increment Financing District No. 7-5A (herein sometimes referred as the "TIF District"), to be located within Development District No. 7, and approve and adopt the Tax Increment Financing Plan relating thereto, all pursuant to and in accordance with Minnesota Statutes, Sections 469.124 through 469.134, inclusive, and Minnesota Statutes, Sections 469.174 through 469.179, inclusive (collectively, the "Act"). 1.02. The Council has investigated the facts and has caused to be prepared the proposed Tax Increment Financing Plan for the TIF District (herein sometimes referred to as the "TIF Plan"). 1.03. The City has performed all actions required by law to be performed prior tc the establishment of the TIF District and the adoption of the TIF Plan relating thereto, including, but not limited to, notification of the County Commissioner in whose district the property proposed to included in the TIF District is located, notification of the County and School Districts having taxing jurisdiction over the property proposed to be included in the TIF District, a review by the City Planning Commission of the proposed TIF Plan and the holding of a public hearing upon published notice as required by law. Section 2. Findings for the Establishment of Tax Increment Financing District No. 7-5A, and the Approval of the Tax Increment Financing Plan relating thereto. 2.01. The Council hereby finds that the TIF District is a housing district as defined in Minnesota Statutes, Section 469.174, subdivision 11. 2.02. The Council hereby finds that the establishment of the TIF District and the approval of the TIF Plan relating thereto are intended and, in the judgement of this Council, the effect of such actions will be, to provide an impetus for the development of affordable housing in the City, with related commercial development, which will advance the objectives set forth in the Development Program for Development District No. 7 and will serve the public purposes envisioned by the creation of housing districts in accordance with the Act. Res. 98-541 Page 2 2.03. The Council further finds that the proposed development, in the opinion of the Council, would not occur solely through private investment within the reasonably foreseeable future and 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 the 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 district permitted by the TIF Plan; that the TIF Plan conforms to the general plan for the development or redevelopment of the City as a whole; and that the TIF Plan will afford maximum opportunity consistent with the sound needs of the City as a whole, for the development of Development District No. 7 and Tax Increment Financing District No. 7-5A by private enterprise. The reasons and supporting facts for each of the foregoing determinations are set forth in Exhibit A attached hereto. Section 3. Establishment of Tax Increment Financing District No. 7-5A; Approval of the Tax Increment Financing Plan. 3.01. Tax Increment Financing District No. 7-5A is hereby established and the Tax Increment Financing Plan for Tax Increment Financing District No. 7-5A is hereby approved and adopted, and shall be placed on file in the office of the City Manager. 3.02. The City Manager is authorized and directed to request the County Auditor to certify the original tax capacity value of the real property within the TIF District and the original tax capacity rate for the TIF District. 3.03. The City Manager is also authorized and directed to file a copy of the TIF Plan with the Commissioner of Revenue, as required by Minnesota Statutes, Section 469.175, subdivision 2. 3.04. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the TIF Plan and for this purpose to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. hereof. 3.05. This Resolution shall be in full force and effect from and after the date Adopted by the City Council on September 2, 1998. Res. 98-541 Page 3 EXHIBIT A The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 7-5A as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Firiiiirig that Tax Increment Fifuaricirig District No. 7-5A is a lloiisirig district as defined iii Miririesot« St«titites, Section 469.174, SiAlivisiori 11. The development proposed to occur within the TIF District is set forth in Section I of the TIF Plan, consisting primarily of for -sale townhomes and rental housing. The income requirements for the purchasers of the townhomes and the residents of the rental housing are set forth in Section E of the TIF Plan, and the City believes those income requirements are a reasonable definition of "moderate income" for the City of Plymouth. The City will enter into one or more contracts with the developers of the townhouses and the rental housing, which contracts will obligate the developers to comply with the applicable income requirements and will provide recourse to the City in the event of a default in compliance. The City will also take all necessary action to insure that the fair market value of any improvements constructed for uses other than low and moderate income housing does not exceed 20% of the total fair market value of all planned improvements. 2. Firiiiirig that the proposed deoelopinent, iii the opiriiori of the Coitiricil, zwidd riot occur solely tlirongli priozrte invesMierrt zvithirr the reirsorurbly foreseezrble fiitrrre zrrrd, therefore, the use of tax irrcrcirierrt firunrcirrg is deemed accessary. Given the general high cost of land in the City, and the housing market for the City, the City has determined that the production of moderate income housing requires assistance with site improvement expenses. The prime developer, The Rottlund Company, Inc., has also informed the City that the proposed development is not feasible, at the proposed housing prices and rentals, without assistance with such costs, particularly since much of the land upon which the development will be constructed requires substantial soil correction, thereby increasing the cost of development of the particular parcels to be included within the TIF District. Exhibit V of the TIF Plan, which is incorporated herein by reference, shows that 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 the 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 district permitted by the TIF Plan. Res. 98-541 Page 4 3. Fiiidiiig that the Tax Increment Fiiiaiiciiig Plan conforms to the general plan for the deoelopinent or redeoelopinent of the ifriiiiicipality as « zoliole. The site is appropriately zoned. The Tax Increment Financing Plan for Tax Increment Financing District No. 7-5A has been reviewed by the Planning Commission and been found by resolution adopted by the Planning Commission to conform to the general plan for the development or redevelopment of the City as a whole. 4. Fiiiciiiig that the Tax hicrcmcnt Fiiiaiiciiig Plaii for Tax hicrcmcnt Fiiiaiiciiig District No. 7-5 zoill afford ifiaxiifiiiiii opportunity, corisisterit zoith the sound needs of the City GZs GZ whole, for the deoelopinent of Deoelopinent District No. 7 acid Tax Increment Fiiiaiiciiig District No. 7-5 by prioate enterprise. The assistance to be provided by the City pursuant to the Tax Increment Financing Plan will be limited to payment or reimbursement of soil correction and public improvement expenses in connection with the property to be used for the townhouse and rental housing developments. The total amount of tax increment bonds to be issued by the City will not exceed $3,000,000 whereas the total estimated market value of all improvements within the TIF District upon completion of all planned improvements is approximately $10,600,000. Hence the great majority of the development will be undertaken and funded by private enterprise with the role of the City being primarily to facilitate the development.