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HomeMy WebLinkAboutCity Council Resolution 2011-120CITY OF PLYMOUTH RESOLUTION No. 2011-120 RESOLUTION ADOPTING A MODIFICATION TO THE DEVELOPMENT PROGRAM FOR DEVELOPMENT DISTRICT NO. 7; AND ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 7-8 THEREIN AND ADOPTING A TAX INCREMENT FINANCING PLAN THEREFOR. BE IT RESOLVED by the City Council (the "Council') of the City of PIN -mouth, Minnesota (the "City"), as follows: Section 1. Recitals 1.01. The City Council of the City of PIN -mouth (the "City") has heretofore established Development District No. 7 and adopted the Development Program therefor. It has been proposed that the City adopt a Modification to the Development Program for Development District No. 7 (the "Development Program Modification") and establish Tai Increment Financing District No. 7-8 (the "District") therein and adopt a Tai Increment Financing Plan (the "TIF Plan") therefor (the Development Program Modification and the TIF Plan are referred to collectively herein as the "Program and Plan"), all pursuant to and in conformity Nvith applicable law, including Minnesota Statutes, Sections 469.124 to 469.134 and Sections 469.174 to 469.1799, all inclusive, as amended, (the "Act") all as reflected in the Program and Plan, and presented for the Council's consideration. 1.02. The City has investigated the facts relating to the Program and Plan and has caused the Program and Plan to be prepared. 1.03. Members of the Board of County Commissioners of Hennepin County (the "County") and of the Board of Education of Independent School District No. 270 (the "School District") have been given an opportunity to meet Nvith the City and comment on the Program and Plan, pursuant to Minnesota Statutes, Section 469.175, subdivision 2. Pursuant to Minnesota Statutes, Section 469.175, subdivision 3, and Section 469.126, subdivision 1, the Council conducted a public hearing on the desirability of approving the Program and Plan. Notice of the public hearing Nvas duly published as required by law in Sun Sailor, the official newspaper of the City, on March 31, 2011. 1.04. Certain written reports (the "Reports") relating to the Program and Plan 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 Program and Plan. The Reports, including the redevelopment qualifications, TIF Application, reports and planning documents, 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, Nvhich 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 modifying the boundaries of Development District No. 7 to be coterminous Nvith the city limits of the Citv of PIN -mouth. 1.06 The Planning Commission in and for the City (the "Commission") approved the plans on February 8, 2011. Section 2. Findinus for the Adoption and Approval of the Development Prouram Modification 2.01. The Council approves the Development Program Modification, and specifically finds that: (a) the land Nvithin the Project area as expanded Nvould not be available for redevelopment Nvithout the financial aid to be sought under this Development Program, (b) the Development Program, as modified, Nvill afford maximum opportunity, consistent Nvith the needs of the City as a Nvhole, for the development of the Project by private enterprise, and (c) that the Development Program, as modified, conforms to the general plan for the development of the City as a Nvhole. Section 3. Findings for the Establishment of Tax Increment Financing District No. 7-8 3.01. The Council hereby finds that the District is a "redevelopment district" under Minnesota Statutes, Section 469.174, Subd. 10(a)(1) of the Act. 3.02. The Council further finds that: (1) the proposed redevelopment Nvould not occur solely through private investment within the reasonably foreseeable future, (2) that the increased market value of the site that could reasonably be expected to occur Nvithout the use of tax increment financing Nvould 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, (3) that the Program and Plan conform to the general plan for the development or redevelopment of the City as a Nvhole, and (4) that the Program and Plan Nvill afford maximum opportunity consistent Nvith the sound needs of the City as a Nvhole, 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. 3.04. The City of PIN -mouth elects to calculate fiscal disparities for the District in accordance With Minnesota Statutes, Section 469.177, Subd. 3, clause b, which means the fiscal disparities contribution, if anv, Neill be taken from inside the District. Section 4. Public Purpose 4.01. The Council hereby finds that there is a need for the City to take certain actions designed to encourage, ensure and facilitate development and redevelopment by the private sector of underutilized and unused land located Nvithin the corporate limits of the City to (a) provide additional employment opportunities for residents of the City and the surrounding area, (b) improve the tax base of the City, the County and the School District, thereby enabling them to better utilize existing public facilities and provide needed public services, (c) to alleviate a shortage of decent, safe, and sanitary housing for persons of low or moderate incomes and their families, and (d) improve the general economy of the City, the County and the State of Minnesota (the "State"). For the reasons described in Exhibit A, the City believes these benefits directIv derive from the tax increment assistance provided under the TIF Plan. A private developer Nvill receive only the assistance needed to make this development financially feasible. As such, any private benefits received by a developer do not outweigh the primary public benefits Section 5. Approval and Adoption of the Program and Plan 5.01. Upon review of the Development Program, the information elicited at the public hearing and on the basis of the findings in Section 2, this Council hereby adopts the modification to the Development Program. 5.02 Upon review of the TIF Plan, the information elicited at the public hearing and on the basis of the findings in Section 4, the Council hereby approves and adopts the TIF Plan and the establishment of the District as a tai increment financing district in the City, to be denominated "Tai Increment Financing District No. 7-8." 5.03. The staff of the City, the Citv's advisors and legal counsel are authorized and directed to proceed Nvith the implementation of the Program and Plan and to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 5.04 The Auditor of Hennepin County is requested to certIA- the original net tai capacity of the District, as described in the Program and Plan, and to certify in each Near thereafter the amount by Nvhich the original net tai capacity has increased or decreased; and the City of PIN -mouth is authorized and directed to forthNvith transmit this request to the County Auditor in such form and content as the Auditor may specify, together Nvith a list of all properties Nvithin the District, for Nvhich building permits have been issued during the 18 months immediately preceding the adoption of this resolution. 5.05. The City Manager is further authorized and directed to file a copy of the Program and Plan Nvith 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 Nvas made by Council member Bildsoe , and duly seconded by Council member Johnson, and upon a vote being taken thereon, the folloNving voted in favor thereof: Council members Murdock, Stein, Black, Bildsoe, and Johnson. and the folloN ing voted against the same: Mavor Slavik and Council member Willis. Adopted April 12, 2011. Citv Clerk (Seal) EXHIBIT A RESOLUTION NO. 2011-120 The reasons and facts supporting the findings for the adoption of the Tai Increment Financing Plan (TIF Plan) for Tax- Increment aiIncrement Financing District No. 7-8 (District), as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: Finding that Tax Increment Financing District No. 7-8 is a redevelopment district as defined in M.S., Section 469.174, Subd. 10(a)(1). The District consists of two parcels, Nvith plans to redevelop the area for housing purposes. At least 70 percent of the area of the parcels in the District are occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures and more than 50 percent of the buildings in the District, not including outbuildings, are structuralIv substandard to a degree requiring substantial renovation or clearance. (See Appendix F of the TIF Plan.) 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 fixture and 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 TIFPlan. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable fixture: This finding is supported by the fact that the redevelopment proposed in the TIF Plan meets the Citv's objectives for redevelopment as explained in the City Comprehensive Plan. Due to the high cost of redevelopment on the parcels currently occupied by substandard buildings, the cost of financing the proposed improvements, and the cost of providing affordable housing, the project is feasible oniv through assistance, in part, from tax increment financing. The developer Nvas asked for and provided a proforma as justification that the developer Nvould not have gone fonvard Nsthout tax increment assistance. (See attachment in Appendix G of the TIF Plan.) 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 District permitted by the TIF Plan: This finding is justified on the grounds that the cost of site acquisition and improvements, as Nvell as the cost of providing affordable housing, add to the total redevelopment cost. The site has remnants of a failed development and has substandard structures Nvith little or no market values. While the site has good visibility, it has poor access that limits its commercial development potential. The City anticipates that only multi -family housing Nvill be financialIv feasible on this site in today's market, even Nvith similar assistance being provided to the development. In addition, the developer proposes to make 40% of the units available to persons and families who earn less than 60% of the area median income. Therefore, the Citv concludes as follows a. The Citv's estimate of the amount by which the market value of the entire District Nvill increase Nvithout the use of tax increment financing is $0. b. If the proposed development occurs, the total increase in market value Nvill be $18,380,100 (see Appendix D and G of the TIF Plan) The present value of tax increments from the District for the maximum duration of the district permitted by the TIF Plan is estimated to be $2,676,301 (see Appendix D and G of the TIF Plan). d. Even if some development other than the proposed development Nvere to occur, the Council finds that no alternative Nvould occur that Nvould produce a market value increase greater than $15,703,799 (the amount in clause b less the amount in clause c) Nvithout tai increment assistance. 3. Finding that the TIF Plan for the District conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission revieNved the TIF Plan and found that the TIF Plan conforms to the general development plan of the City. Finding that the TIF Plan for the District will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Development District No. 7 by private enterprise. The project to be assisted by the District Nvill result in the prompt development of property in the District in a manner consistent Nvith the Citv's planning and Nvith minimal adverse impact on the environment. The project Nvill increase the tai base of the City, School Districts No. 270 and other taxing jurisdictions in order to better enable those entities to pay for public improvements and governmental services. The project Nvill provide increased opportunities for persons and families to reside in quality multi -family units at affordable rents, and promote development that links housing Nvith employment centers and transportation corridors. The project Nvill also provide construction jobs in the City during the anticipated 16 month construction period. Through the implementation of the TIF Plan, the City Nvill increase the availability of safe and decent life-evele housing in the City.