HomeMy WebLinkAbout4.d. Verbal Update - Carlson Redevelopment Plan.
CITY OF ROSTMODNT
EXIsCIITIVE SUb��ARY FOR ACTION
PORT AUTHORITY MEETING DATE: NOVEMBER 15, 1994
AGENDA ITEbi: Carlson Redevelopment Plan Update AGENDA S$CTION:
OLD BUSINESS
PREPARED BY: Ron Wasmund, AGENDA NO.
Community Development Director 4. D.
ATTACI�NTS: Draft Plan APPROVED B -
,/
At the meeting on Tuesday, staff will conduct discussion with you regarding
the Carlson redevelopment proposal . We will try to answer any questions
you have. We will also have a presentation from the proponent of the motel
development, Central Group Development. Upon conclusion of the discussion
we must then set the date of the public hearing for December 20, 1994.
With the date set for the hearing staff can �hen proceed with the necessary
letters of intent that must go to the county and school district. This
letter puts both entities on notice that we intend to capture the increment
generated by this project. Two weeks before the hearing we will publish a
notice in the paper notifying the general public.
RECObIl�iENDED ACTION: Motion setting the public hearing for the
creation of a tax increment redevelopment district for 5 :30 p.m. on
December 20, 1994, and directing staff to proceed with the necessary
notices.
PORT AU'THORITY ACTION:
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City of Rosemount, Minnesota
Tax Increment Financing Plan
for
Tax Increment Financing (Redevelopment)
District No, _
(Carlson Project} �
Dated: November 1, 1994 .
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• . TABLE OF CONTENTS
Section Paae(sl
ADefinitions ............................................................................................. 1
B Statement of Need and Public Purpose ................................................. 1
C Statement of Authorization .................................................................... 1
D Statement of Objectives ................................:.......:............................... 1
E Designation of Tax Increment Financing District as a
RedevelopmentDistrict ................................................................... 1-2
F Duration of the TIF District ....................................._.............................. 3
G Prope�ty to be Included in the TIF District ............................................. 3
H Property to be Acquired in the TIF District.............................................. 3
I Specific Development Expected to Occur Within the TIF District ........... 3
.1 Findings and Need for Tax Increment Financing ................................... 4
KEstimated Public Costs ......................................................................... 4-5
L Estimated Amount of Bonded Indebtedness ......................................... 5
M Estimated Sources of Revenue ............................................................. 5
N Original Net Tax Capacity ..................................................................... 5
O Original Tax Capacity Rate ................................................................... 6
p Projected Retained Captured Net Tax Capacity and6
Projected Tax Increment ................................................................. 6
QUse of Tax Increment............................................................................. 7
R Excess Tax Increment............................................................................ 7-8
S Tax Inc�ement Pooling ........................................................................ 8
T Limitation on Administrative Expenses .................................................. 8-9
U Limitation on Property Not Subject to Improvements ............................. 9
V Estimated Impact on Other Taxing Jurisdictions ................................... 9
W Local Govemment Aid Penalty .............................................................. 9
X Prior Planned Improvements ................................................................. 9
Y Development Agreements ..................................................................... 10
ZAssessment Agreements ...................................................................... 10
AA Modifications of the Tax Increment Financing Plan ............................... 10
AB Administration of the Tax Increment Financing Plan ............................. 40-11
AC Financial Reporting and Disclosure Requirements ................................ 11-13
Map of the Tax Increment Financing District.......................................................... EXHIBIT I
Projected Tax Increment Report............................................................................ EXHIBIT II
Projected Loss of LGA/HACA Report .................................................................... EXHIBIT I11
Estimated Impact on 4ther Taxing Jurisdictions �teport ........................................ EXHIBIT IV
• ' P
� . • Ci#y of Rosemount, Minnesota
• clearance. A parcel is deemed "occupied" if at least 15% of the area of the parcel
contains some type of improvement; or
(2) the property consists of vacant, unused, underused, inappropriately used, or
infrequently used railyards, rail storage facilities, or excessive or vacated rail�oad right-
of-ways.
For districts consisting of two more noncontiguous areas, each area must individually qualify
under the provisions listed above, as well as the entire area must also qualify as a whole.
The TIF District qualifies as a redevefopment district in that it meets all of the criteria listed in (1)
above. The suppo�ting facts and documentation for this determination will be retained for the
life of the T1F District and are available to the public upon request.
"Structurally substandard" is defined as buildings containing defects or deficiencies in structural
e{ements, essential utilities and facilities, light and ventilation, fire protection (including egress),
layout and condition of interior partitions, or similar factors. A building is not structurally
substandard if it is in compliance with the building code applicable to a new building, or could be
modified to satisfy the existing code at a cost of less than 15% of the cost of constructing a new
structure of the same size and type.
The City may find that a building is structurally substandard without an interior inspection or an
independent expert appraisal, if there exists "reasonably available evidence" to support this
conclusion. Such evidence may include size, type, and age of the building, the average cost of
plumbing, electrical, or structural repairs, or other similar information.
A parcel is deemed to be occupied by a structurally substandard building if the following
conditions are meet:
(1) the parcel was occupied by a substandard building within a three-year period prior to the
parcels inclusion in the district; and �
(2) if the substandard building was demolished or removed within the three year period, .
such demolition or removal was performed or financed by the Authority, or was
performed by a developer under a development agreement with the Authority. In
addition, the Authority must have found by resolution before such demolition or removal
occurred that the building was structurally substandard and that the Autho�ty intended
to include the parcel in the TIF District.
In the case of (2) above, the County Auditor shall certify the Original Net Tax Capacity of the
parcel to be the greater of (a) the current tax capacity of the parcel, or (b) a computed tax
capacity of the parcel using the estimated market value of the parcel for the year in which the
demolition or removal occurred, and the appropriate classification rate(s) for the current year.
At least 90 percent of the tax increment derived from the TIF District must be used to finance
the cost of correcting conditions that allow designation as a redevelopment district. These
costs include acquiring properties containing structurally substandard buildings or
improvements, acquiring adjacent parcels necessary to provide a site of sufFcient size to permit
development, demolition of structures, clearing of land, and installation of utilities, roads,
sidewalks, and parking facilities for the site. The allocated administrative expenses of the
Authority may be included in the qualifying costs.
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. - City of Rosemount, Minnesota
Section J Findings and Need for Tax Increment Financing
In establishing the TIF District, the City makes the following findings:
(1) The TIF District qualifies as a redevelopment district;
See Section E of this document for the reasons and facts supporting this
finding.
' (2) The propased development, in the opinion of the City, would not reasonably be
expected to occur solely through private investment within the reasonably
foreseeable future, and therefore the use of tax increment financing is deemed
necessary;
The reasons and facts supporting this finding are that the developer has
represented to the Authority that it would not unde�take the proposed
development without the assistance of tax increment financing. Private
investment will not finance these development activities because of
prohibitive costs. It is necessary to finance these development activities
through the use of tax increment financing so that other development by
private enterprise will occur within the Development District.
(3) The T1F Plan conforms to the general plan for development or redevelopment of
the City as a whole; and
The reasons and facts supporting this finding are that the TIF District is _
prope�ly zoned and the T1F Plan will generally compliment and serve to
implement policies adopted in the City's comprehensive plan.
(4) The TIF Plan will afford maximum opportunity, consistent with the sound needs
of the City as a whole, for the development of the Project Area by private
enterprise. �
The reasons and facts supporting this finding are that the development
activities are_ necessary so that development and redevelopment by
private enterprise can occur within the Development District.
y� Section K Estimated Pub(ic Costs
The estimated public costs of the proposed devefopment in the TIF District are listed below.
Such costs a�e eligible for reimbursement from tax increments of the TIF District.
Land Acquisition /Writedown $ 650,000
On-Site Street Utilities 210,000
Soii Contamination 150,000
Building Demolition 125,000
Site Grading 50,000
Relocation Costs 250.000
Subtotal $1,435,000
Capitalized Interest 300,000
Administration 190.000
Tota! Public Costs $1.925.000
F1 SPRINGSTED Page 4
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� City of Rosemount, Minnesota
� Section O Original Tax Capacity Rate
The County Auditor shali also certify the Original Tax Capacity Rate of the TiF District. This
rate shall be the sum of ail locai tax rates that appiy to property in the TIF District. This rate
shall be for the same taxes payable year as the Original Net Tax Capacity.
In future yea�s, the amount of tax increment generated by the TIF District wiii be calculated
using the lessor of (a) the sum of the current local tax rates at that time or (b)the Original Tax
Capacity Rate of the TIF Oistrict.
At the time this document was prepared, the sum of all local tax rates that apply to property in
the TIF District, for taxes levied in 1994 and payable in 1995, was not yet avai(able. When this
total becomes available, the County Auditor shal! certify this amount as the Original Tax
Capacity Rate of the T1F District. For purposes of estimating the tax increment generated by
the TIF District, the sum of the local tax rates for taxes levied in 1993 and payable in 1994, is
125.668% as shown below. �
1993/1994
Taxing Jurisdiction Local Tax Rate
City of Rosemount 32.297%
Dakota County 27.474%
Independent School District#196 60.933%
Other �4°�a
Total 125.668%
Section P Projected Retained Captured Net Tax Capacity and
Projected Tax Increment
Each year the County Auditor shall determine the current net tax capacity of all property in the
TIF District. To the extent that this totai exceeds the Original Net Tax Capacity, the difference
shall be known as the Captured Net Tax Capacity of the TIF District.
For communities affected by the fiscal disparity provisions of Minnesota Statutes,
Chapter 473F, the Original Net Tax Capacity of the T1F District shall be determined before the
application of fiscal disparity. In subsequent years, the current net tax capa�city shaU either
(a) be determined before the application of fiscal disparity or (b) exclude the product of any
fiscal disparity increase in the TIF District (since the Original Net Tax Capacity was certified)
times the appropriate fiscal disparity ratio. The method the Authority elects shall remain the
same for the life of the T1F District, except that a single change may be made at any time from
method (a) to method (b) above. The Authority elects option (a) in the determination of the
cur�ent net tax capacity of the T{F District.
The County Auditor shall ce�tify to the Authority the amount of Captured Net Tax Capacity each
year. The Authority may choose to retain any or all of this amount. It is the Authority's intention
to retain 100% of the Captured Net Tax Capacity of the TIF District. Such amount shall be
known as the Retained Captured Net Tax Capacity of the T1F District.
The projected tax increment generated over the life of the TIF District is shown in Exhibit II.
F1 SPRINGSTED Page 6
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(4) retum excess tax increments to the County Auditor for redistribution to the City,
County and Schooi District in propo�tion to thei� locai tax capacity rates. The
County Audito� must report to the Commissioner of Education the amount of any
excess tax increme�t redistributed to the Schoof District within 30 days of such
redistribution.
Section S Tax Increment Pooling
In general, at least 75% of the tax increments from the T1F District must be expended on
activities within the district or to pay for bonds used to finance the estimated public costs of the
TtF District (see Section E for additional restrictions). No more than 25% of the tax increments
may be spent on costs outside of the T1F District, but within the boundaries of the Project Area.
All administrative expenses are considered to have been spent outside of the TIF District. Tax
increments are considered to have been spent within the TIF District if, within five years after
certification, such amounts were used to:
(1) make payments to a third party for activities performed within the TIF District;
(2) make payments or reimbursements under binding contracts to a third party for
activities performed within the TIF District; or
(3) pay bonds that were issued and sold to a third party, the proceeds of which are
reasonably expected on the date of issuance to be spent within the later of the
five-year period or a reasonable temporary period or are deposited in a
reasonably required reserve or replacement fund.
Beginning with the sixth year following certification of the TIF District, at least 75% of the tax
increments must be used to pay outst'anding bonds or make contractual payments obligated
within the first five years. When outstanding bonds have been defeased and sufficient money
has been set aside to pay for such contractual obligations, the TIF District must be dece�tified.
The Authority does not anticipate that tax increments will be spent outside of the TIF District
(except for allowable administrative expenses); however, the Authority does reserve the right to
allow for tax increment pooling from the TIF District in the future.
Section T Limitation on Administrative Expenses
Administrative expenses are defined as all costs of the Authority other than:
(1) amounts paid for the purchase�of land;
(2) amounts paid for materials and services, including architecturai and engineering
services directly connected with the proposed development within the T1F .
District;
(3) relocation benefits paid to, or services provided for, persons or businesses
located within the TIF District; or
(4) amounts used to pay interest on, fund a reserve for, or sel{ at a discount, tax
increment bonds.
Administrative expenses include amounts paid for services provided by bond counsel, fiscal
. consultants, planning or economic development consultants, and actual costs incurred by the
F1 SPRINGSTED Page 8
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Section Y Development Agreements
If more than 25% of the acreage of a project (which contains a redevelopment district) is to be
acquired by the Authority with proceeds from tax increment bonds then, prior to such
acquisition, the Authority must enter into an agreement for the development of the property.
Such agreement must provide recourse for the Authority should the development not be
completed.
The Authority anticipates entering into an agreement fo�development.
Section Z Assessment Agreements
The Authority may, upon entering into a development agreement, also enter into an
assessment agreement with the developer, which establishes a minimum market value of the
land and improvements for each year during the life of the TIF District.
' The assessment agreement shall be presented to the County or City Assesso�who shall review
the plans and specifications for the improvements to be constructed, review the market value
previously assigned to the land, and so long as the minimum market value contained in the
assessment agreement appears to be a reasonable estimate, shall certify the assessment
agreement as reasonable. The a5sessment agreement shall be filed for record in the office of
the County Recorder of each county where the property is located. Any modification or
premature termination of this agreement must first be approved by the City, Caunty and Schooi
District
The Authority anticipates entering into an assessment agreement.
Sectio� AA Modifications of the Tax tncrement Financing Plan
Any reduction or enlargement in the geographic area of the Project Area or the TIF District;
increase in the amount of bonded indebtedness to be incurred; increase in the amount of
capitalized interest; increase in that portion of the Captured Net Tax Capacity to be retained by
the Authority; increase in the total estimated public costs; or designation of additional property
to be acquired by the Authority shall be approved only after satisfying all the necessary
requirements for approval of the original TIF Plan. This paragraph does not apply if:
(1) the only modification is elimination of parcels from the Project Area or the TIF
District; and
(2) the current net tax capacity of the parcels eliminated equals or exceeds the net
tax capacity of those parcels in the TIF District's Original Net Tax Capacity, or
the Authority agrees that the TIF District's Qriginal Net Tax Capacity will be
reduced by no more than the current net tax capacity of the parcels eliminated.
The Authority must notify the County Auditor of any modification that reduces or enlarges the
geographic area of the Project Area or the TIF District. The geographic area of the TIF District
may be reduced but not enlarged after five years following the date of certification.
Section AB Administration of the Tax Increment Financing Plan
Upon adoption of the T1F P►an, the Authority shall submit a copy of such plan to the Min�esota
Department of Revenue. The Authority shall also request that the County Auditor certify the
F1 SPRINGSTED Page 10
' , City of Rosemount, Minnesofa
before July 1, an annual financiai report for the TiF District. The repoR must aiso be provided
to the City Council, Schoo! District Board and the County Board. This report shaiL
(1) provide full disciosure of the sources and uses of pubiic funds in the TIF District;
(2) peRnit comparison and reconciliation of the accounts and financial reports;
(3) permit auditing of the funds expended on behalf of the TIF District; and
{4) be consistent with`generaily accepted accounting principles.
In addition, the report shal{ contain the folbwing information:
(1) the Original Net Tax Capacity of the T{F Distri�t;
(2) the Captured Net Tax Capacity of the TIF District, including the amount of any
Captured Net Tax Capacity shared with other taxing jurisdictions;
(3) the outstanding principal amount of bonds issued or other loans incuRed to
finance public costs in the TIF District;
(4) for the reporting period and for the duration of the TIF District, the amount
budgeted under the T1F Plan, and the actual amount expended for, at least, the
following categories:
(a) acquisition of land and buildings through condemnation or purchase;
(b) site improvements or preparation costs;
(c) instalfation of public utilities or other public improvements; and
(d) administrative costs, including the al(ocated cost of the Authority. -
(5) for properties sold to developers, the total cost of the property to the Authority
and the price paid by the developer, and
(6) the amount of tax-exempt obligations, other than those reported under
clause (3), that were issued on behalf of private parties for facilities located
within the T1F District.
The City must also annually report to the State Commissioner of Revenue, by March 1 of each
year, the following: .
(1) for the entire City:
(a) the total principal amount of nondefeased tax increment bonds
outstanding at the end of the previous calendar year; and
(b) the total amount of principal and interest payments that are due for the
current calendar year on tax increment bonds.
(2) for each tax increment financing district in the City:
(a) the type of district;
G1 SPRINGSTED Page 12
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• - EXHIBIT I
Tax increment �nancing District No. (?i
(Redevelopment)
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� Projected Tax Increment Repo�t '
City of Rosemount� Minnesota
Tax Increment Financing (Redevelopment) District No: (?)
Carlson Project (Phases I, 11 and I11)
Less: Less: Retained Times: Less:
Annual Total Original Fiscal Captured Tax Annuai Adm./Pooling Annual
Period Net Tax Net Tax Disparities @ Net Tax Capacity Gross Tax Retainage Net Tax
Ending Capacity Capacity 0.0000% Capacity Rate Increment 10.00% Increment
(�) (2) (3) (4) �5> �6� - ------�7�------- ------�8�----- -----�9� - --
------------ __ -- ------------- -----------
--- 12/31/95 --------22,389 ------22,389 0 0 125.668% 0 U �
12/31/96 22,389 22,389 0 0 125.666% 0 0 0
12/31/97 94,733 22,389 0 72,344 125.668% 90,913 9,091 81,822
12/31/98 117,733 22,389 0 95,344 125.668% 119,817 11,982 107,835
12/31/99 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2000 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2001 184,433 22,389 0 162,044 125.666% 203,637 20,364 183,273
12/31/2002 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2003 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2004 184,433 22,389 0 162,044 125.668% 203,637 20,364 ' 183,273
12/31/2005 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2006 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2007 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2008 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2009 184,433 22,389 0 162,044 125.668% 203,637 � 20,364 183,273
12/31/2010 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2011 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31 J2012 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2013 184,433 22,389 0 162,044 125.668% 203,637 20,364 183,273
12/31/2014 184,433 184,433 U 0 125.668% 0 0 0
12/31/2015 184,433 184,433 0 0 125.668% 0 0 0
12/31/2016 184,433 184,433 0 0 125.668% 0 0 0 =
12/31/2017 � 184,433 184,433 0 0 125.668% 0 0 0
_ - - --- �
. $3,265,285 $326,533 $2,938,752 =�
Prepared by: Springsted Incorporated (01-Nov-94)
CITY OF ROSEMOUNT
Resolution No.
RESOLUTION CALLING FOR A PUBLIC HEARING ON THE
MODIFICATION OF THE REDEVELOPMENT PLAN FOR THE
ROSEMOUNT REDEVELOPMENT PROJECT AND
ESTABLISHMENT OF TAX INCREMENT FINANCING
DISTRICT NO. 1-2 AND A TIF PLAN THEREFOR
BE IT RESOLVED by the City Couneil of the City of Rosemount, Minnesota as
follows:
Section 1. Recitals.
1.01. The City of Rosemount ("City") and its Housing and Redevelopment
Authority ("HRA") have previously created the Rosemount Redevelopment Praject
(the "Redevelopment�taroStatutes tSections 469 Oldtoe469m047 and predecessolr
pursuant to Minnes ,
statutes (the "HRA Act").
1.02. The City and its Economic Development Authority (EDA) have
previously created Development District No. 1 in the City and a Development Distriet
therefor, pursuant to Minnesota Statutes, Sections 469.124 to 469.13�4.
1.03. The City created the Rosemount Port Authority ("RPA") by resolution
approved September 3, 1991 (the "Enabling Resolution") .
1.04. By resolution approved September 15, 1992, the City expanded the
boundaries of the Redevelopment Project to coincide with those of the Development
District and made certain other modifications to the Redevelopment Plan and the
Development Program.
1.05. Pursuant to the Enabling Resolution, the RPA has all the powers of a
housing and redevelopment authority under the HRA Act and administers the
Redevelopment Project, and has been designated as administrator of the Development
District.
1.06. The City has determined that, in order to more efficiently govern its
redevelopment and development programs, it is desirable to consolidate the
Development District and the Redevelopment Project as a single Redevelopment
Project under the HRA Act, with a single Redevelopment Plan.
1.07. The City and the RPA have also contemplated providing tax increment
financing ("TIF") assistance to facilitate the redevelopment of property within the
Redevelopment Projeet at the southwest corner of the intersection of County R.oad
42 and State Highway 3, all pursuant to the HRA Act and Minnesota Statutes,
Sections 469.174 to 469.179 (the "TIF Act").
SJH79489 ,
RS230-5
Section 2. Public Hearin� Called.
2.01. RPA and City staff and consultants are authorized to prepare any
necessary revisions to the Redevelopment Plan to effectuate the consolidation
described above, and a TIF Plan for proposed TIF District No. 1-2 (a redevelopment
district) and to file a copy of such documents in City Hall.
2.02. The City Clerk is authorized and direeted to prepare a notice for
publication in the City's official newspaper setting a public hearing before the City
Council on December 20, 1994 at 7:30 p.m. in the council chambers on the modified
Redevelopment Plan and the TIF Plan. The notice shall be published in the
newspaper at least 10 but not more than 30 days prior to the public hearing, and
shall include a map of the Redevelopment Project and the proposed and TIF Distriet.
2.03. The City Clerk or designated consultants are authorized and directed
to transmit a copy of the Redevelopment Plan and TIF Plan to the County Board and
School Board, and to take all other actions necessary to bring such documents before
the City Council at the time of the public hearing.
2.04. The City Council ratifies the actions of City and R.PA staff and
consultants taken to date in contemplation of creating the proposed TIF District,
including delivery of notice to the County Commissioner representing the City as
required under Section 469.175, Subd. 2a of the TIF Act.
Approved by the City Council of the City of Rosemount this 15th day of
November, 1994.
Mayor
ATTEST:
City Clerk
SJB79489
RS230-5
NOTICE OF PUBLIC HEARING
NOTICE is hereby given that the City Council of the City of Rosemount will
meet in the City Hall in Rosemount, Minnesota at 7:30 p.m. on Tuesday, December
20, 1994 to conduct a public hearing on the creation of Tax Increment Financing
�rrTIF") District No. 1-2 (a redevelopment district) and a TIF plan for that district,
and modification of the Redevelopment Plan for the Rosemount Redevelopment
Project.
The boundaries of the existing Redevelopment Project and proposed TIF
District No. 1-2 are shown in the map below. The purpose of this proposed action
is to facilitate redevelopment of property located generally at the southwest corner
of the intersection of County Road 42 and State Highway 3. Proposed new
development ineludes a hotel, restaurant and other commercial services. Details on
the proposal are contained in the Redevelopment Plan and TIF Plan, a draft copy of
which will be available for public inspeetion at the Rosemount City Hall during
regular business hours.
Any person wishing to express an opinion on the matters to be considered at
the public hearing will be heard orally or in writing.
BY ORDER OF THE CITY COUNCIL.
Dated: [Date of Publication]
City Clerk
City of Rosemount, Minnesota
3JB79496
R8230-5
HaLn�s � G��N
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�N�c.��.. �����,���
Attp�pdsy at IaW � TeleR�(612)337-93e0
FkaiwBe(612)337•4310
Diiect Dixt(5�2)337-9228
Novembe�r 15, 1994
Ron Wasmun�,
Tam Burt
City of Rasemowat
p.0. Ba� �1Q
Ros�nnc7u.r�.t, MN 55Q88-0510
Desr Ron and Tom:
Enclased are the follaw�n.g:
I_ Citsr of R.osemount resolu'tion ca��
for a public �e�x�ing on the
a�odifica#�on of the R.edevelopment Pla.n for the Rosemount
Rede^�ela�paent Pxojeet and e�tablishment of t�ie T�' Distx�.ct 1-2 and a
TIF F1an; and
2. Natice of Public Heai`a.ng re�ard�the ex^�atiQu�f TIF District No. 1-�
and the T��` Plax�.
If you h&Qe at�ty q,uestiox�s� please feel fz�e€ to cA13-ta.�t me.
Very truly yours,
�����"�~���
Step�en d, P
ubul� �
enc.
ce I MSl'k �TYl1I�LQ�.3�2� Spring;sted
S/Z 3�tid 0LE6LEE�I9°QI N3l1tt239 '8 53Fi'IOH°WOz[3 ES 'SL b6-SL-l10f1
CITY QF R�SEMDUNT
Resalutian No.
RESQLUTION CALLII�G FOR.A PUBLIC I�EARING ON 'I'HE
MOJ�I�'ICA,TION OF THE�tEDE�TELOPN�I'T PT�AN FC?R'I'HE
ROSEYVIQUNT REDEVEL(7PMENT PP.OJECT .�ND
ESTABLISHMENT 4F TAX INCREMENT FINANCR�iG
DISTRICT I�4. 1-2 AND A TIF PLAN THEREFG�R
BE IT RESOLVED bp the Citp Council of the City o� Rasemouant, Minnesota as
fallows:
Section 1. Re, citals•
X.01, The Citg of Ros�mount ('�City") aud its Housang and Redevelap�aent
Attthoxxty ("HRAn) have previously creatcd the Rosemount Redevelapmex�t Project
(the "Redeve�,ogment Praject") in the Cxtp aud a Q dtQ�469m047 a��.d predecessor
pursuamt to Minnesota Statutes, Sectxons 469•U
statv.tes (the "H7�tA Act").
1.02- '�he Cit� ax�d its Economic Development Authority t�A) have
previausly ereated De�relopment Disixict No. 1 ixl the City a.nd a Development DYstxzct
.�E����� ��g7�7ATlt tQ Nlii7,]a,e50'k� S#Atut�S, Seetions 469.7.2� to 469•1�4•
7..03. The City creat�d the Rosemount Pa�t Author.i�ty' t�RP.A") bY res°Y�ti°n
appra�ed September 3, 1991 Cthe "E�.blix�.g Resoluti.on").
�..�4_ By resolutivx� appz•oved Sep'tember �.5, 1992, the City expsnded the
boundax�i.es of the R.ede�velopment Praject to eoine�ide with those o� the Develapment
District ax�d mafle certain otb.er x�odi�icatians to the l�.�deve�ogm,ent Plan and the
Y7evelrrpment Prog'ram•
1.05. Fursuant to 'the Enabliug Resolzttiou, th� RPA has a11 the powers vf a
housir�g a.nd xedevelopmen# authority under the H�LA Act and admi��texs tl�e
Redewelopment Project, and b.as been desi�rn�ted as ad�ni.nistrator of the I�e�ae3opment
�istr�.et.
1.Q6. The Czty has determ�n�d th�.t, in arder to more ef�icie.ntl� g;ov�ern its
redevelopment and de�elopmeut px�ograms a it is desirable to eons�lidate the
Developxnent Distrzct and the Redevelap�nt Projeet as a singl.e Red�velopme�.t
Project umder the H�t.A A.et, with a single Redeveiopmen.t Plan.•
1.07. '�'he Ci�ly a.nd #he RPA ha�e also ca�templated prov3din�tax �c�men.t
fixxancizxg {"TrF'�) assistance to �acilitate the redevelop�ent Qf prr�perty within the
Redeve2o�ament Prajeet at the s rs�xant tu th�e HRA Ac�t and�Min�s �tatutea
�2 and State Flighway 3, � P
Sections 469.174 to 469.I79 (the "TIF Act"}•
5.7879d89 ,
RS230-5
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Sect�ion 2. Pa.blic H�-r;n�?' Called_
2,Ql. RPi4. and City staff and consultants are authorized to P�P� �Y
necessary revisions to the �tedeveiopment P]�n, ta effectu,a-te the consQl�da'tian
described above, and a T�F Plan for propos�.'I'IF Distz�,ct Na. 1-2 (a redevelapment
clistrict) and to �le a. copy of such documents in City �all.
2.42. 'The City Cl�rk is authorized and direeted to PreP� a notice for
publicat�ioxx in tYxe City's of�cial�wspaper setting a publ�e hea.ring laefore the City
Gouncil an Decemb�r 20, �594 at 7:30 p.m. in t3ie coun� ��b�� � � �°��d
Redevelopment Fian antl the TZF P1e�n. The notice shall be published in the
newspape� at 1,east 1d but �ot raore tlaa�a 30 days prior to the pu�b�� hear.ing, at�c1
sb�ll inc�ude a map af the�tedevelopment Proje�t and the prapo$ed axid T�F Distric#.
2.03. The City Cleark or dr�si�ated consultants ax�e autharized anB��and
to t�ansmit a eogy of the Redevelopment Plan ax�d TI�Pl�n to t,h� Cowi'tY
School Baa�rd, and to take a�J.other sclians r3.ecessarY to bring such dacuments befox�e
the Gity Counail at the time vf the pub�.i.e hearing-
2,04. Tl�e City' Counci�, ratifi�s the actians o� City and RPA s�f and
consultants taken to date i�a eo3atempIation of creating the propased TIF` Distric#,
a
xncl-cidin.g deliver� af notice to the Caunty Coaa�missioner representing the Citg as
required �der Sectio3a. 469.X75, Subd. 2a of the TIF Act.
Approvec� by the City Cauncil of the Gity of Rosem�aunt th3s 7.5th day of
Novemb�r, 1994.
Mayor
ATTES'�':
Gity cl.erk
�79d89
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N4�'ZGE QF �U�3LIC �EAB�ING
NQTICE is hereby gi�en that the City Ca�Gil af the G'�ity of Rosemount wi]].
meet in the City Hall Yn Rosemou�at, Minlaesota at 7;30 p.m, ax3. Tuesday, December
2U, 7.994 to conduct a public hearxng on the �reati.on of Tax Increment Finanezng
{ttTIF"} Dis�ri,et No. 7.-2 (a redevelopment district) and a TYF plan fa�th�t district,
and modification. of the Red�velopnaent P]an for the R.osem�ount Redevelo}amexax
Froject.
The boundaries af fihe e�isti�g Aede�elapment Project and proposed TY�`
Distra,�t No. X-2 az�e shown in the map below. The parpose af this ��coposed act�on
is to facilitate redevelapment af property located g�nerally at the sou#hwest corner
OP tYi� lI1tETs�Ct1�Il: of Caunty Road 42 and State Aighway 3. Pr�posed ne�
deveiop�ent includes a hotel, restaurant and other com�mereisl services. Details on
t�.e prapdsal are contained in #b.e Redevelapment Plaaa and TY�'F]an, a clraft copy'of
which will be avaiYable far public inspection at the �t�semount Ci�tp Ha13. during
�egular busiazess hours_
Aa�.y pez son wishing to express an opinion on the�na.tters to be cons�idez ed at
the public hearing will b� heard oxallg or in writing-
8Y ORDER Q�' T�iE CI'�'Y CQUNCIL,
Dated: [Date �f Publicatzan]
City Cler�
City of R.ose�aux�t, Mi�esota
SJ879496
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City of Rosemount, Minnesota
Tax increment Financing Plan
for
Tax Increment Financing (Redevelopment)
District No. 1-2
(Carlson Project) h
Dated: November 15, 1994
_
,
TABLE OF CONTENTS
i n ��.
.,_
ADefinitions ............................................................................................. 1
B Statement of Need and Public Purpose ................................................. 1
C Statement of Authorization .................................................................... 1
D Statement of Objectives ........................................................................ 1
E Designation of Tax Increment Financing District as a
Redevelopment District ................................................................... 1-2
F Duration of the TIF District .................................................................... 3
G Property to be Included in the TIF District ............................................. 3
H Property to be Acquired in the TIF District.............................................. 3
I Specific Development Expected to Occur�thin the TIF District ........... 4
J Findings and Need for Tax Increment Financing ................................... 4
K Estimated Public Costs ......................................................................... 5
L Estimated Sources of Revenue.............................................................. 5
M Estimated Amount of Bonded Indebtedness ........................................ 5
NOriginal Net Tax Capacity ...............:..................................................... 5-6
O Original Tax Capacity Rate ................................................................... 6
P Projected Retained Captured Net Tax Capacity and
P�ojected Tax Increment ................................................................. 6-7
Q Use of Tax Increment............................................................................. 7
R Excess Tax Increment............................................................................ 8
S Tax Increment Pooling .......................................................................... 8
T Limitation on Administrative Expenses .................................................. 9
U Limitation on Property Not Subject to Improvements ............................. 9
V Estimated Impact on Other Taxing Jurisdictions ................................... . 9
W Local Government Aid Penalty .............................................................. 10
X Prior Planned Improvements ................................................................. 10
YDevelopment Agreements ..................................................................... 10
Z Assessment Agreements ...................................................................... 10
AA Modifications of the Tax Increment Financing Plan ............................... 11
AB Administration of the Tax Increment Financing Plan ............................. 11-12
AC Financial Reporting and Disclosure Requirements ................................ 12-13
Map of the Tax Increment Financing District.......................................................... EXHIBIT I
Projected Tax Increment Report............................................................................ EXHIBIT II
Projected Loss of LGA/HACA Report .................................................................... EXHIBIT III
Estimated Impact on Other Taxing Jurisdictions Report ........................................ EXHIBIT N
� � City of Rosemount, Minnesota
Section A Definitions
The terms defined in this section have the meanings given herein, unless the context in which
they are used indicates a different meaning:
- "Authoritv" means the Port Authority in and for the City of Rosemount, Minnesota.
" ' " means the City of Rosemount, Minnesota; also referred to as a "Municipali y".
. "City Council" means the City Council of the City; also referred to as the "Governing Bodv".
" u " means Dakota County, Minnesota.
"Develo�ment District" means Municipal Development District No. 1 in the City, which is
described in the corresponding Development Program.
"Develo�ment Program" means the Development Program for the Development District
"Proj�ct Area" means the geographic area of the Development District.
"School District" means Independent School District No. 196, Minnesota.
"State" means the State of Minnesota.
" IF A " means Minnesota Statutes, Sections 469.174 through 469.179, both inclusive.
"TIF District" means Tax Increment Financing (Redevelopment) District No. 1-2.
"TIF Plan" means the tax increment financing plan for the TIF District (this document).
Section B Statement of Need and Public Purpose
See Subsection 1.2 of the Development Program for the Development District.
Section C Statement of Authorization
See Subsection 1.3 of the Development Program for the Development District.
Section D Statement of Objectives
See Subsection 1.4 of the Development Program for the Development District.
Section E Designation of Tax Increment Financing District as a
Redevelopment District
Redevelopment districts are a type of tax increment financing district in which one of the
following conditions exists and is reasonably distributed throughout the district:
(1) parcels comprising at least 70% of the area of the district are occupied by buildings,
streets, utilities, or other improvements, and more than 50% of the buildings (not
including outbuildings) are structurally substandard requiring substantial renovation or
F1 SPRINGSTED Page 1
� City of Rosemount, Minnesota
ctearance. A parcel is deemed "occupied" if at least 15% of the area of the parcel
contains some type of improvement; or
(2) the property consists of vacant, unused, underused, inappropriately used, or
infrequently used railyards, rail storage facitities, or excessive or vacated railroad right-
._ of-ways.
The TIF District qualifies as a redevelopment district in that it meets all of the criteria listed in (1)
above. The supporting facts and documentation for this determination will be retained for the
life of the TIF District and are available to the public upon request.
"Structurally substandard" is defined as buildings containing defects or deficiencies in structural
elements, essential utilities and facilities, light and ventilation, fire protection (including egress),
layout and condition of interior partitions; or similar factors. A building is not structurally
substandard if it is in compliance with the building code applicable to a new building, or could be
modified to satisfy the existing code at a cost of less than 15% of the cost of constructing a new
structure of the same size and type.
The City may find that a building is structurally substandard without an interior inspection or an
independent expert appraisal, if there exists "reasonably available evidence" to support this
conclusion. Such evidence may include size, type, and age of the building, the average cost of
plumbing, electrical, or structural repairs, or other similar info�mation.
A parcel is deemed to be occupied by a structurally substandard building if the following
conditions are meet:
(1) the parcel was occupied by a substandard building within a three-year period prior to the
parcels inclusion in the district; and
(2) if the substandard building was demolished or removed within the three year period,
such demolition or removal was perFormed or financed by the Authority, or was
performed by a developer under a development agreement with the Authority. In
addition, the Authority must have found by resolution before such demolition or removal
� occurred that the building was structurally substandard and that the Authority intended
to inctude the parcel in the TIF District.
In the case of (2) above, the County Auditor shall certify the Original Net Tax Capacity of the
parcel to be the greater of (a) the current tax capacity of the parcel, or (b) a computed tax
capacity of the parcel using the estimated market value of the parcel for the year in which the
demolition or removal occurred, and the appropriate classification rate(s) for the cur�ent year.
At least 90 percent of the tax increment derived from the TIF District must be used to finance
the cost of correcting conditions that allow designation as a redevelopment district. These
costs include acquiring properties containing structurally substandard buildings or
improvements, acquiring adjacent parcels necessary to provide a site of sufficient size to permit
development, demolition of structures, clearing of land, and installation of utilities, roads,
sidewalks, and parking facilities for the site. The allocated administrative expenses of the
Authority may be included in the qualifying costs.
FJ SPRINGSTED Page 2
° City of Rosemount, Minnesota
" Section F Duration of the TIF District
Redevelopment districts may remain in existence 25 years from the date of receipt of the first
tax increment. This term shall be reduced to 20 years if the Authority elects to delay receipt of
the first tax increment until a minimum market value for the TIF District is reached or exceeded,
_ or four years have elapsed from the date of certification, whichever is earlier. Modifications of
this plan (see Section AA) shall not extend these limitations.
The Authority does not elect to delay receipt of the first tax increment. The Authority also does
not anticipate at this time that the TIF District will remain in existence the maximum duration
allowed by law, but reserves the right to allow the TIF District to exist for such a duration. All
tax increments from taxes payable in the year the TIF District is decertified shall be paid to the
Authority.
In addition, no tax increments shall be �aid to the Authority from the TIF Districf after three
years from the date of certification unless within that time period:
(1) bonds have been issued in aid of the Project Area (except revenue bonds issued
pursuant to M.S. Sections 469.152 to 469.165);
(2) the Authority has acquired property within the TIF District; or
(3) the Authority has constructed public improvements within the TIF District.
Section G Property to be Included in the TIF District
The TIF District is a two parcel area located within the Development District. A map showing
the location of both the TIF District and Development District is shown in Exhibit I. The
boundaries and area encompassed by the TIF District are described below:
Parcel ID Number �g�l Descri tp ion
34-71150-021-04 Part of Lot 2 Lying N of Line Drawn From
Point on E Line Lot 3 360.21 Ft S of NE
Corner SE to Point on E Line Lot 2 260 Ft
NE of SE Corner Lot 2 and There Term All
in Blk 4 Ex N 150 Ft of W 50 Ft of Blk 4
Lot 2
34-71150-032-04 N 360.21 Ft of Lot 3 Blk 4 as Measured
Along E Line of Lot 3 Blk 4
The area encompassed by the TIF District shall also include all street, alley and railroad right-
of-way and utility or drainage easements located upon or adjacent �to the property described
above.
Section H Property to be Acquired in the TIF District
The Authority may acquire and sell any or all of the property located within the TIF District;
however, the Authority does not anticipate at this time acquiring any such property.
F1 SPRINGSTED Page 3
City of Rosemount, Minnesota
' Section I Specific Development Expected to Occur Within the TIF District
At the present time, proposed development in the TIF District includes construction of a 46-unit
hotel and associated restaurant in 1995 (Phase I), construction of a fast foot restaurant in 1996
(Phase II) and construction of an automotive/service center and daycare facility in 1997
__ (Phase III). It is anticipated that existing structures in the TIF District will be demolished in 1995
or 1996. At the time this document was prepared there were no signed construction contracts
with regards to the proposed development.
Section J Findings and Need for Tax Increment Financing
In establishing the TIF District, the City makes the following findings:
(1) The TIF District qualifies as a redevelopment district;
See Section E of this document for the reasons and facts supporting this
finding.
(2) The proposed development, in the opinion of the City, would not reasonably be
expected to occur solely through private investment within the reasonably
foreseeable future, and therefore the use of tax increment financing is deemed
necessary; •
The reasons and facts supporting this finding are that the developer has
represented to the Authority that it would not undertake the proposed
development without the assistance of tax increment financing. Private
investment will not finance these development activities because of
prohibitive costs. It is necessary to finance these development activities
through the use of tax increment financing so that other development by
private enterprise will occur within the Development District.
(3) The T1F P1an conforms to the general plan for development or redevelopment of
the City as a whole; and
The reasons and facts supporting this finding are that the TIF District is
properly zoned and the TIF Plan will generally compliment and serve to
implement policies adopted in the City's comprehensive plan.
(4) The TIF Plan will afford maximum opportunity, consistent with the sound needs
of the City as a whole, for the development of the Project Area by private
enterprise.
The reasons and facts supporting this finding are that the development
activities are necessary so that development and redevelopment by
private enterprise can occur within the Development District.
GJ SPRINGSTED Page 4
� City of Rosemount, Minnesota
Section K Estimated Pubiic Costs
The estimated public costs of the proposed development in the TIF District are listed below.
Such costs are eligible for reimbursement from tax increments of the TIF District.
_ Land Acquisition /Writedown $ 650,000
� On-Site Street Utilities 210,000
Soil Contamination 150,000
Building Demolition 125,000
Site Grading 50,000
Relocation Costs 250.000
Subtotal $1,435,000
Public Improvements (outside TIF District) 158,250
Capitalized Interest 305,750
Administration 211.000
Total Public Costs $2,110,000
The Authority reserves the right to adjust the amount of any items listed above or to incorporate
additional eligible items, so long as the total estimated public cost in not increased.
Section L Estimated Sources of Revenue
The Authority anticipates providing financial assistance to the proposed development through
the use of a combination of internal funding and pay-as-you-go reimbursement. As tax
increments are collected from the TIF District in future years, a portion of these taxes will either
be distributed to the City as reimbursement for public costs internally funded, or distributed to
the developer as reimbursement for other public costs incurred. Reimbursement may include
accrued interest, but in no event will the total reimbursements exceed the total public costs
incurred plus such accrued interest.
The Authority reserves the right to finance any or all public costs of the TIF District using pay-
as-you-go assistance, internal funding, general obligation debt, or any other financing
mechanism authorized by law. The Authority reserves the right to use other sources of revenue
legally applicable to the Project Area to pay for such costs including, but not limited to, special
assessments, utility revenues, federal or state funds, and investment income.
Section M Estimated Amount of Bonded Indebtedness
The Authority does not anticipate that tax increment bonds will be issued to finance any of the
estimated public costs of the TIF District, but reserves the right to issue such bonds in an
amount not to exceed $2,110,000.
Section N Original Net Tax Capacity
The County Auditor shall certify the Original Net Tax Capacity of the TIF District, which will be
the total net tax capacity of all property in the TIF District as certified by the State
Commissioner of Revenue. For districts certified befinreen January 1 and June 30, inclusive,
this value is based on the previous assessment year. For districts certified between July 1 and
December 31, inclusive, this value is based on the current assessment year.
G� SPRINGSTED Page 5
' City of Rosemount, Minnesota
The Estimated Market Value of all property within the TIF District as of January 2, 1994, for
taxes payable in 1995, is $619,100. Upon establishment of the TIF District, and subsequent
reclassification of property, it is estimated that the Original Net Tax Capacity of the TIF District
will be approximately $26,879.
Each year the County Auditor shall certify the amount that the Original Net Tax Capacity has
increased or decreased as a result of:
(1) changes in the tax-exempt status of property;
(2) reductions or enlargements of the geographic area of the TIF District;
(3) changes due to stipulation agreements or abatements; or
(4) changes in classification �ates.
Section O Original Tax Capacity Rate
The County Auditor shall also certify the Original Tax Capacity Rate of the TIF District. This
rate shall be the sum of all local tax rates that apply to property in the TIF District. This rate
shall be for the same taxes payable year as the Original Net Tax Capacity.
In future years, the amount of tax increment generated by the TIF District will be calculated
using the lessor of (a) the sum of the current local tax rates at that time or (b) the Original Tax
Capacity Rate of the TIF District.
At the time this document was prepared, the sum of all local tax rates that apply to property in
the TIF District, for taxes levied in 1994 and payable in 1995, was not yet available. When this
total becomes available, the County Auditor shall certify this amount as the Original Tax
Capacity Rate of the T1F District. For purposes of estimating the tax increment generated by
the TIF District, the sum of the local tax rates for taxes levied in 1993 and payable in 1994, is
125.668% as shown below.
1993/1994
Taxing Jurisdiction Local Tax Rate
City of Rosemount 32.297%
Dakota County 27.474%
Independent School District#196 60.933%
Other �4%
Total 125.668%
Section P Projected Retained Captured Net Tax Capacity and
Projected Tax Increment
Each year the County Auditor shall determine the current net tax capacity of all property in the
TIF District. To the extent that this total exceeds the Original Net Tax Capacity, the difference
shall be known as the Captured Net Tax Capacity of the TIF District.
For communities affected by the fiscal disparity provisions of Minnesota Statutes,
Chapter 473F, the Original Net Tax Capacity of the TIF District shall be determined before the
application of fiscal disparity. In subsequent years, the current net tax capacity shall either
G� SPRINGSTED Page 6
� City of Rosemount, Minnesota
(a) be determined before the application of fiscal disparity or (b) exciude the product of any
fiscal disparity increase in the TIF District (since the Original Net Tax Capacity was certified)
times the appropriate fiscal disparity ratio. The method the Authority elects shall remain the
same for the life of the TIF District, except that a single change may be made at any time from
method (a) to method (b) above. The Authority elects option (a) in the determination of the
,__ current net tax capacity of the TIF District.
The County Auditor shall certify to the Authority the amount of Captured Net Tax Capacity each
year. The Authority may choose to retain any or all of this amount. It is the Authority's intention
to retain 100% of the Captured Net Tax Capacity of the TIF District. Such amount shall be
known as the Retained Captured Net Tax Capacity of the TIF District.
The projected tax increment generated over the anticipated life of the T(F District is shown in
Exhibit IL
Section Q Use of Tax Increment
The Authority has determined that it will use 100% of the tax increments generated by the TIF
District for any of the following purposes:
(1) Pay for the estimated public costs of the TIF District (see Section K) and County
administrative costs associated with the TIF District (see Section T);
(2) pay principal and interest on tax increment bonds or other bonds issued to
finance the estimated public costs of the TIF District;
(3) accumulate a reserve securing the payment of tax increment bonds or other
bonds issued to finance the estimated public costs of the TIF District;
(4) pay all or a portion of the county road costs as may be required by the County
Board under M.S. Se�tion 469.175, Subdivision 1a; or
(5) return excess tax increments to the County Auditor for redistribution to the City,
County and School District in proportion to their local tax capacity rates. �
Tax increments from property located in one county must be expended for the direct and
primary benefit of a project located within that county, unless both county boards involved waive
this requirement. Tax increments shall not be used to circumvent levy limitations applicable to
the City.
Tax increment shall not be used to finance the acquisition, construction, renovatic�n, operation,
or maintenance of a building to be used primarily and regularly for conducting the business of a
municipality, county, school district, or any other local unit of government or the State or federal
govemment. This prohibition does not apply to the construction or renovation of a parking
structure, a common area used as a public park, or a facility used for social, recreational, or
conference purposes and not primarily for conducting the business of the community.
If there exists any type of agreement or arrangement providing for the developer, or other
beneficiary of assistance, to repay all or a portion of the assistance that was paid or financed
with tax increments, such payments shall be subject to all of the restrictions imposed on the use
of tax increments. Assistance includes sales of property at less than the cost of acquisition or
fair market value, grants, ground or other leases at less then fair market rent, interest rate
subsidies, utility service connections, roads, or other similar assistance that would otherwise be
paid for by the developer or beneficiary.
G1 SPRINGSTED Page 7
� City of Rosemount, Minnesota
� Section R Excess Tax Increment
In any year in which the tax increments from the TIF District exceed the amount necessary to
pay the estimated public costs authorized by the TIF Plan, the Authority shall use the excess
tax increments to:
(1) prepay any outstanding tax increment bonds;
(2) discharge the pledge of tax increments thereon;
(3) pay amounts into an escrow account dedicated to the payment of the tax
increment bonds; or
(4) return excess tax increments to the County Auditor for redistribution to the City,
County and School District in proportion to their local tax capacity rates. The
County Auditor must report to the Commissioner of Education the amount of any
excess tax increment redistributed to the School District within 30 days of such
redistribution.
Section S Tax Increment Pooling
In general, at least 75°!0 of the tax increments from the TIF District must be expended on
activities within the district or to pay for bonds used to finance the estimated public costs of the
TIF District (see Section E for additional restrictions). No more than 25% of the tax increments
may be spent on costs outside of the TIF District, but within the boundaries of the Project Area.
All administrative expenses are considered to have been spent outside of the TIF District. Tax
increments are considered to have been spent within the TIF District if, within five years after
certification, such amounts were used to:
(1) make payments to a third party for activities performed within the TIF District;
(2) make payments or reimbursements under binding contracts to a third party for
activities perFormed within the T1F District; or
(3) pay bonds that were issued and sold to a third party, the proceeds of which are
reasonably expected on the date of issuance to be spent within the later of the
five-year period •or a reasonable temporary period or are deposited in a
reasonably required reserve or replacement fund.
Beginning with the sixth year following certification of the TIF District, at least 75% of the tax
increments must be used to pay outstanding bonds or make contractual payments obligated
� within the first five years. When outstanding bonds have been defeased and sufficient money
has been set aside to pay for such contractual obligations, the TIF District must be decertified.
The Authority reserves the right to allow for tax increment pooling from the TIF District.
G� SPRINGSTED Page 8
� City of Rosemount, Minnesota
Section T Limitation on Administrative Expenses
Administrative expenses are defined as aii costs of the Authority other than:
(1) amounts paid for the purchase of land;
� (2) amounts paid for materials and services, including architectural and engineering
services directly connected with the proposed development within the TIF
District;
(3) relocation benefits paid to, or services provided for, persons or businesses
located within the TIF District; or
(4) amounts used to pay interest on, fund a reserve for, or sell at a discount, tax
increment bonds.
Administrative expenses include amounts paid for services provided by bond counsel, fiscal
consultants, planning or economic development consultants, and actual costs incurred by the
County in administering the TIF District. Tax increments may be used to pay administrative
expenses of the TIF District up to the lessor of (a) 10% of the total estimated public costs
authorized by the TIF Plan or (b) 10% of the total tax increment expenditures of the project.
Section U Limitation on Property Not Subject to Improvements
If after four years from certification of the TIF District no demolition, rehabilitation, renovation,
or qualified improvement of an adjacent street has commenced on a parcel located within the
TIF District, then that parcel shall be excluded from the TIF District and the Original Net Tax
Capacity shall be adjusted accordingly. Qualified improvements of a street are limited to
construction or opening of a new street, relocation of a street, or substantial reconstruction or
rebuilding of an existing street. The Authority must submit to the County Auditor, by February 1
of the fifth year, evidence that the required activity has taken place for each parcel in the TIF
District.
If a parcel is excluded from the TIF District and the Authority or owner of the parcel
subsequently commences any of the above activities, the Authority shall certify to the County
Auditor that such activity has commenced and the parcel shall once again be included in the
TIF District. The County Auditor shall certify the net tax capacity of the parcel, as most recently
certified by the Commissioner of Revenue, and add such amount to the Original Net Tax
Capacity of the TIF District.
Section V Estimated Impact on Other Taxing Jurisdictions
Exhibit IV shows the estimated impact on other taxing jurisdictions if the maximum projected
Retained Captured Net Tax Capacity of the TIF District was hypothetically available to the other
jurisdictions. The Authority believes that there will be no adverse impact on other taxing
jurisdictions during the life of the TIF District, since the proposed development would not have
occurred without the establishment of the TIF District and the provision of public assistance. A
positive impact on other taxing jurisdictions will occur when the TIF District is decertified and the
devefopment therein becomes part of the general tax base.
G'� SPRINGSTED Page 9
' City of Rosemount, Minnesota
Section W Locai Government Aid Penaity
Tax increment financing districts established or expanded after April 30, 1990 may cause a
reduction in the local government aid (LGA/HACA) received by the City from the State. Such
reduction is an offset to the decrease in state aid the School District would othervvise receive,
due to the manner in which the Retained Captured Net Tax Capacity of the TIF District is
treated in the school aids formula. Exhibit 111 shows the projected loss of LGA/HACA payments
to the City given the anticipated life of the TIF District.
Section X Prior Planned Improvements
The Authority shall accompany its request for certification to the County Auditor (or notice of
district enlargement), with a listing of all properties within the TIF District for which building
permits have been issued during the 18 months immediately preceding approval of the T1F
Plan. The County Auditor shall increase the Original Net Tax Capacity of the TIF District by the
net tax capacity of each improvement for which a building permit was issued.
There have been no building permits issued in the last 18 months in conjunction with any of the
properties within the TIF District.
Section Y Development Agreements
If more than 25% of the acreage of a project (which contains a redevelopment district) is to be
acquired by the Authority with proceeds from tax increment bonds then, prior to such
acquisition, the Authority must enter into an agreement for the development of the property.
Such agreement must provide recourse for the Authority should the development not be
completed.
The Authority anticipates entering into an agreement for development, but does not anticipate
acquiring any property within the TIF District.
Section Z Assessment Agreements
The Authority may, upon entering into a development agreement, also enter into an
assessment agreement with the developer, which establishes a minimum market value of the
land and improvements for each year during the life of the TIF District.
The assessment agreement shall be presented to the County or City Assessor who shall review
the plans and specifications for the improvements to be constructed, review the market value
previously assigned to the land, and so long as the minimum market value contained in the
assessment agreement appears to be a �easonable estimate, shall certify the assessment
agreement as reasonable. The assessment agreement shall be filed for record in the office of
the County Recorder of each county where the property is located. Any modification or
premature termination of this agreement must first be approved by the City, County and School
District.
The Authority anticipates entering into an assessment agreement.
GJ SPRINGSTED Page 10
� City of Rosemount, Minnesota
Section AA Modifications of the Tax increment Financing Plan
Any reduction or enlargement in the geographic area of the Project Area or the TIF District;
increase in the amount of bonded indebtedness to be incurred; increase in the amount of
capitalized interest; increase in that portion of the Captured Net Tax Capacity to be retained by
the Authority; increase in the total estimated public costs; or designation of additional property
to be acquired by the Authority shall be approved only after satisfying all the necessary
requirements for approval of the original TIF Plan. This paragraph does not apply if:
(1) the only modification is elimination of parcels from the Project Area or the TIF
� District; and
(2) the current net tax capacity of the parcels eliminated equals or exceeds the net
tax capacity of those parcels in the TIF District's Original Net Tax Capacity, or
the Authority agrees that the TIF District's Original Net Tax Capacity will be
reduced by no more than the current net tax capacity of the parcels eliminated.
The Authority must notify the County Auditor of any modification that reduces or enlarges the
geographic area of the Project Area or the TIF District. The geographic area of the TIF District
may be reduced but not enlarged after five years following the date of certification.
Section AB Administration of the Tax Increment Financing Plan
Upon adoption of the TIF Plan, the Authority shall submit a copy of such plan to the Minnesota .
Department of Revenue. The Authority shall also request that the County Auditor certify the
Original Net Tax Capacity and Net Tax Capacity Rate of the TIF District. To assist the County
Auditor in this process, the Authority shall submit copies of the TIF Plan, the resolution
establishing the TIF District and adopting the TIF Plan, and a listing of any prior planned
improvements. The Authority shall also send the County Assessor any assessment agreement
establishing the minimum market value of land and improvements in the TIF District, and shall
request that the County Assessor review and certify this assessment agreement as reasonable.
The County shall distribute to the Authority the amount of tax increment as it becomes
available. The amount of tax increment in any year represents the total property taxes
generated by the Retained Captured Net Tax Capacity of the TIF District. The amount of tax
increment may change due to development anticipated by the TIF Plan, other development,
inflation of property values, or changes in property classification rates or formulas. In
administering and implementing the TIF Plan, the following actions should occur on an annual
basis:
(1) prior to July 1, the Authority shall notify the County Assessor of any new
development that has occurred in the TIF District during the past year to insure
that the new value will be recorded in a timely manner.
(2) if the County Auditor receives the request for certification of a new T1F District, or
for motlification of an existing TIF District, on or before July 1, the request shall
be recognized in determining local tax rates for the current and subsequent levy
years. Requests received after July 1 shall be used to determine local tax rates
in subsequent years.
(3) each year the County Auditor shall certify the amount of the Original Net Tax
Capacity of the TIF District. The amount ce�tified shall reflect any changes that
occur as a result of the following:
G� SPRINGSTED Page 14
City of Rosemount, Minnesota
(a) the value of property that changes from tax-exempt to taxable shall be
added to the Original Net Tax Capacity of the TIF District. The reverse
shall also apply;
. (b) the Original Net Tax Capacity may be modified by any approved
_ enlargement or redu�tion of the TIF District;
(c) if the TIF District is classified as an economic development district, then
the Original Net Tax Capacity shall be increased by the amount of the
annual adjustment factor; and
(d) if laws governing the classification of real property cause changes to the
percentage of Estimated Market Value to be applied for property tax
purposes, then the resulting increase or decrease in net tax capacity shall
be applied proportionately to the Original Net Tax Capacity and the
Retained Captured Net Tax Capacity of the TIF District.
The County Auditor shall notify the Authority of all changes made to the Original Net Tax
Capacity of the TIF District.
Section AC Financial Reporting and Disclosure Requirements
The Commissioner of Revenue shall enforce the provisions of the TIF Act; however, the
responsibility for financial and compliance auditing of the Authority's use of tax increment
financing lies with the State Auditor. The Authority must submit to the State Auditor, on or
before July 1, an annual financial report for the TIF District. The report must also be provided
to the City Council, School District Board and the County Board. This report shali:
(1) provide full disclosure of the sources and uses of public funds in the TIF District;
(2) permit comparison and reconciliation of the accounts and financial reports;
(3} permit auditing of the funds expended on behalf of the TIF District; and
(4) be consistent with generally accepted accounting principles.
In addition, the report shall contain the following information:
(1) the Original Net Tax Capacity of the TIF District;
(2) the Captured Net Tax Capacity of the TIF District, including the amount of any
Captured Net Tax Capacity shared with other taxing jurisdictions;
(3) the outstanding principal amount of bonds issued or other loans incurred to
finance public costs in the TIF District;
(4) for the repo�ting period and for the duration of the TIF District, the amount
budgeted under the TIF Plan, and the actual amount expended for, at least, the
following categories
(a) acquisition of land and buildings through condemnation or purchase;
(bj site improvements or preparation costs;
GJ SPRINGSTED Page 12
' City of Rosemount, Minnesota
(c) installation of public utilities or other public improvements; and
(d) administrative costs, inctuding the allocated cost of the Authority.
(5) for properties sold to developers, the total cost of the property to the Authority
__ and the price paid by the developer; and
(6) the amount of tax-exempt obligations, other than those reported under
clause (3), that were issued on behalf of private parties for facilities located
within the TIF District.
The City must also annually report to the State Commissioner of Revenue, by March 1 of each
year, the following:
(1) forthe entire City:
(a) the total principal amount of nondefeased tax increment bonds
outstanding at the end of the previous calendar year; and
(b) the total amount of principal and interest payments that are due for the
current calendar year on tax increment bonds.
(2) for each tax increment financing district in the City:
. (a) the.type of district;
(b) the date the TIF District is required to be decertified; _
(c) the Captured Net Tax Capacity of the TIF District, by property class, for
taxes payable in the current calendar year;
(d) the tax increment revenues for taxes payable in the current calendar
year;
(e) whether the TIF Plan permits tax increment revenues to be expended for
activities located outside of the TIF District, and
(fl any additional information that the Commissioner of Revenue may
require.
G� SPRINGSTED Page 13
EXHIBIT f
Development District No. 1 �
Tax Increment Financing District No. 1-2 _
(Redevelopment)
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Projected Taic Increment Report
City of Rosemount, Minnesota
Tax Increment Financing (Redevelopment) District No. 1-2
Carlson Project (Over Anticipated Life of TIF District)
Less: Less: Retained Times: Less:
Annual Total Original Fiscal Captured Tax Annual Adm./Pooling Annual
Period Net Tax Net Tax Disparities @ Net Tax Capacity Gross Tax Retainage Net Tax
Ending Capacity Capacity 0.0000% Capacity Rate Increment 17.50% Increment
(1} (2) (3) �4) (5) �6� ��) �8) ----�9� . - -
- ---..---------- ----------------- ------------------- ---------- - o
12/31/95 22,389 22,389 0 0 125.668/0 0 0 0
12/31/96 22�389 22,389 0 0 125.668% 0 0 0
12/31/97 94,733 22,389 0 72,344 125.668% 90,913 15,910 75,003
12/31/98 117,733 22,389 0 95,344 125.668% 119,817 20,968 98,849
12/31/99 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2000 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2001 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2002 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2003 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2004 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2005 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2006 184,433 22�389 0 162�044 125.668% 203�637 35,636 168�001
12/31/2007 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2008 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2009 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2010 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2011 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2012 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2013 184,433 22,389 0 162,044 125.668% 203,637 35,636 168,001
12/31/2014 184,433 184,433 0 0 125.668% 0 0 0 rn
----------------- ------------------ ----------- ----- x
$3,265,285 $571,418 $2,693,867 =
-- �
-.�
Prepared by: Springsted Incorporated ( 10-Nov-94 )
Pro'ected Loss of LGA/HACA Re ort
City of Rosemount, Minnesota
Tax Increment Financing (Redevelopment) District No. 1-2
Carlson Project (Over Anticipated Life of TIF District)
Retained Times: Qual'rfying Divided by: Adjusted Times:
Annual Captured Captured I.S.D. Captured I.S.D. Projected
Period Net Tax Phase—In Net Tax Sales Net Tax Equalized Loss of
Ending Capacity Percent Capacity Ratio Capacity Tax Rate LGA/HACA
(1) �2) �3) �4) �5) �6) (�) -----�8�-------
----12/31/95 --- 0 0.00% 0 94.20% °
0 39.28/0 0
12/31/96 0 0.00% 0 94.20% 0 39.28% 0
12/31/97 72,344 0.00% 0 94.20% 0 39.28% 0
12/31/98 95,344 0.00% 0 94.20% 0 39.28% 0
� 12/31/99 162,044 0.00% 0 94.20% 0 39.28% 0
12/31/2000 162,044 0.00% 0 94.20% 0 39.28% 0
12/31/2001 162,044 6.25% 10,128 94.20% 10,752 3928% 0
12/31/2002 162,044 12.50% 20,256 94.20% 21,503 39.28% 4,223
12/31/2003 162,044 18.75% 30,383 94.20% 32,254 39.28% 8,446
12/31/2004 162,044 25.00% 40,511 94.20% 43,005 39.28% 12,669
12/31/2005 162,044 31.25% 50,639 94.20% 53,757 39.28% 16,892
12/31/2006 162,044 37.50% 60,767 94.20% 64,508 39.28% 21,116
12/31/2007 162,044 43.75% 70,894 94.20% 75,259 39.28% 25,339
12/31/2008 162,044 50.00% 81,022 94.20% 86,011 39.28% 29,562
12/31/2009 162,044 56.25% 91,150 94.20% 96,762 39.28% 33,785
12/31/2010 162,044 62.50% 101,278 94.20% 107,514 39.28% 38,008
12/31/2011 162,044 68.75% 111,405 94.20% 118,264 39.28% 42,231
12/31/2012 162,044 75.00% 121,533 94.20% 129,016 39.28% 46,454
12/31/2013 162,044 81.25% 131,661 94.20% 139,768 39.28% 50,677 m
12/31/2014 0 87.50% 0 94.20% 0 39.28% 54,901 =
$384,303 W
,--�
Prepared by: Springsted Incorporated ( 10—Nov-94)
• ; .
Estimated Impact on Other Taxing Jurisdictions Report
City of Rosemount, Minnesota
Tax Increment Financing (Redevelopment) District No. 1-2
Carlson Project (Anticipated Life of TIF District)
Wfthout TIF District With TIF District
Projected Hypothetical
1993/94 1993/94 Retained New Hypothetical Hypothetical Tax Generated
Local 1993/94 Local Captured Local Adjusted Decrease In by Retained
Taxing Net Tax Local Net Tax Net Tax Net Tax Local Local Captured
Jurisdiction Capacity (1) _Tax Rate Capacity_(1) Capacity _ Capacity Tax Rate Tax Rate N.T.C. „
CftyofRosemount 7,281,254 32.297% 7,281,254 162,044 7,443,298 31.594% 0.703% 51,196
Dakota County 197,911,016 27.474% 197,911,016 162,044 198,073,060 27.452% 0.022% 44,484
ISD #196 6B,891,791 60.933% 68,891,791 162,044 69,053,835 60.790% 0.143% 98,507
Other (2) -—— 4.964% ——— 162,044 ——— 4.964% -—— ———
Totals 125.668% • 124.799% 0.869°�
Statement 1: If the projected Retained Captured Net Tax Capacity of the TIF District was hypothetically available to each of
the taxing jurisdictions above,the result would be a lower local tax rate (see Hypothetical Adjusted Tax Rate above)
which would produce the same amount of taxes for each taxing jurisdiction. In such a case,the total local tax rate
would decrease by o.869% (see Hypothetical Decrease in Local Tax Rate above). The hypothetical tax that the
Retained Captured Net Tax Capacity of the TIF District would generate is also shown above.
Statement 2: Since the projected Retained Captured Net Tax Capacity of the TIF District is not available to the taxing jurisdictions,
. then there is no impact on taxes levied or local tax rates. X
2
�
(1) Taxable net tax capacity equals net tax capacity less captured TIF,fiscal disparity contribution and powerline values. �
(2) The impact on these taxing jurisdictions is negligible since they represent only 3.95% of the total tax rate. G
Prepared by: Sringsted Incorporated (10—Nov-94 )