The URL can be used to link to this page

Home My WebLink About6.a. Consideration of Tax Increment Financing Fee Policy �.y CITY OF ROSEMOUNT EXECUTIVE Si]NIIrlARY FOR ACTION CITY COUNCIL MEETING DATE: SEPTEMBER 6, 1994 AGENDA ITEM: CONSIDERATIONS OF TAX INCREMENT AGENDA SECTION: FINANCING FEE POLICY CONSULTANT/STAFF REPORTS PREPARED BY: JOHN MILLER AGENDA NO. 6A ECONOMIC DEVELOPMENT COORDINATOR ATTACHMENTS: POLICY PA-1 TAX INCREMENT APPROVED BY: FINANCING ADMINISTRATIVE FEES SEE ATTACHED MEMO. RECO1�lENDED ACTION: MOTION TO APPROVE POLICY PA-1 (AS AMENDED) TAX INCREMENT FINANCING FEE POLICY COUNCIL ACTION: TO: Chair Carroll Commissioners: Anderson, Busho, Edwards, McMenomy, Miller & Wipperman FROM: John Miller I Economic Development Coordinator �4�, DATE: September 1, 1994 RE: Considerations Of Tax Increment Financing Fee Policy At the port authoriry's August 16 meeting the commissioners discussed fees associated with tax increment financing in two separate agenda items. These were the Carlson Properties request for the establishment of a redevelopment district and the Repairs Inc. redevelopment project. It was the consensus of the board that a policy for these fees be drafted by the staff. Executive Director, Thomas Burt stated that work would be completed in time for board consideration at the September 6 meeting. Attached for your review is a draft of Policy PA-1 Tax Increment Financing Administrative Fees. The draft policy addresses both issues discussed at the August 16 meeting: •Payment of fees associated with the initiation of a project or district; and. •Payment of fees for continuing service and administration of projects and districts. Now, let me digress for the sake of an ancillary issue. Commissioner Edwards inquired about the magnitude of continuing administrative costs and about the number of forms needed to complete TIF administration. The good news if that only a single form is required annually. That is the Minnesota Department of Revenue TIF District Non-Pooled Indebtedness Report. Actual TIF costs are a little more difficult to quantify mainly because the port authority receives money from: •Community Development Block Grant •Mortgage payment •Tax Increment Financing � •Investments •Debt creation Memo Page 2 September 1, 1994 Because of the volatility of these funds, e.g. CDBG money is available only every second year, it's not accurate to pro-rate administrative costs based on revenue. In addition, the port authority's work program, while identifying administrative tasks, does not allocate money to each individual work item. No help there. And, finally, there is the issue of large unforeseen costs. If, for example, the port authority decides to seek legislative extension of the pre-1979 redevelopment district, the work in accomplishing this time consuming task is a large, one-time administrative expense. How is this projected? So does this mean no administrative cost numbers are available? No. Here are some actual costs: •Dakota County TIF Administration 1618.00 •City of Rosemount General Fund Administrative Fee 5625.00 Other administrative expense as identified in the 1994 budget include: •Legal Fees 21,600 •Other professional services 20,000 •L.egal notices 400 •Education and training 5400 The total of all 1994 administrative costs is $135, 997; this includes salaries. Assuming that Dr. Walter-Hansen's annual taxes are $20,000 and that entire amount is available for TIF purposes, the ten per cent administrative fee would be $2000. This requires a judgement call on the part of the board. Is this amount reasonable? Now back to the draft TIF fee agreement. In brief it requires: •The developer to pay the costs of establishing the TIF agreements. •The port authority to retain ten per cent of project fees for administration. ROSEMOUNT PORT AUTHORITY POLICY TITLE: Tax Increment Financing Administrative Fees POLICY NUMBER: PA-1 DATE APPROVED: PURPOSE The purpose of this policy is to establish specific guidelines for the payment of administrative fees in, 1) considering the feasibility of creating a tax increment district, 2) considering the feasibility an individual t� increment project within an established district, 3) considering an amendment to a tax increment project, and 4) general administra.tion of tax increment projects, districts, and revenues. APPLICABLE STATUTES Minnesota laws governing the port authority in this policy include "the Port Act" which includes Minnesota Statutes, Chapter 469.048 to 469.068, "The HRA Act" which includes Chapters 469.002 to 469.047, "The Housing Bond Act" which includes Chapter 462C, "The Industrial Bond Act" that includes Chapters 469.152 to 469.1651, and the "Enabling Act" which includes Chapter 469.0813. The port authority was created by a resolution of the city council of the city of Rosemount. This is Resolution 1992-53. It has adopted, by motion, working bylaws. POLICIES STATEMENT The Rosemount Port Authority shall follow those policies when considering, evaluating, and reviewing t� increment financing requests and in administering tax increment financing projects and districts. PA-1-1. Upon submittal of an application to the Rosemount Port Authority for tax increment fmancing for a housing, economic development, soils, redevelopment, or other eligible project, the developer shall deposit with the port authority a cash escrow of $2,500. PA-1-2 This escrow shall be non-refundable and shall be used by the port authority to evaluate through its professional consultants the feasibility of the request and preparation and amendment of those documents necessary to implement the project. PA-1-3. Projects generating costs greater than $2,500 shall require additional cash escrow deposits as expenses are incuned. Failure by the developer to provide the additional deposits shall result in the project being placed in a hiatus until the deposit is received. If additional deposits are not received within 90 calendar da.ys of mailed request, the project shall be considered terminated. PA-1-4. All costs covered by paragraph PA-1-2 shall be paid by the developer prior to ]� fmal project approval in the form of a development agreement between the �7��} developer and the Rosemount Port Authority. � � PA-1-5. To provide for continuing administrative costs associated with taY increment�;� fmancing activities, the port authority shall be entitled to and shall retain�ten percent of all tax increment revenues for projects with development agreement approval after adoption of this policy. Continuing administrative costs include but are not limited to: annual fees paid to Dakota County for administrative costs in collecting and dispersing taY increment revenues; fees paid to the city of Rosemount for auditing, postage, office space, utilities, and office supplies; staff time in monitoring projects for compliance with development agreement commitments; consultants charges involved in monitoring projects and in enforcement or modification action to provide conformance where necessary; and, all concomitant activity in use of tax increment financing to achieve public goals as identified by the port authority and city of Rosemount. 2 MEMO T0: Port Authority Members FROM: Ron Wasmund Community Development Director DATE: September 6, 1994 SUBJECT: Senior Housing Tour ----------------------------------------------------------------- ----------------------------------------------------------------- The tour of two Dakota County HRA senior housing projects is scheduled for September 7, 1994 . A bus has been hired to take the Port Authority and Planning Commission members to West St. Paul and Hastings . We will depart City hall at 5 : 15 and will be back here at 7:30 . 57 letters of invitation were sent out. Two people have RSVP'd. An example of the letter is attached. Maps were attached for those driving there themselves. i�" � CITY HALL C I TY O F RO S E M O U N T 2875—145th Street West P.O. Box 510 � �� y� �� Rosemount,MN �� &.�a� � Everything's Coming Up Rosemounti! SSo6s-osio � ,� e�e Phone:612-423-4411 Fax:612-423-5203 August 31, 1994 � Commissioner Steven G. Loeding � � 3260 147th Street West l,� Rosemount, MN 55068 , Dear Commissioner Loeding: The Rosemount Port Authority in cooperation with Dalcota County HRA is hosting a tour of two HRA Senior Housing projects. One is located in West St. Paul and one in Hastings. The tour will be at 5:15 p.m. on September 7, 1994. The West St. Paul site is located at 140 East Haslcel. The Hastings site is located at 301 Ramsey Street. We invite you to accompany us on this tour to view how these projects fit into e�cisting neighborhoods. The Port Authority will be talcing a bus for this tour. Limited seating is a�ailable on a first come basis. Ample parlcing is provided at the site for you to parlc your personal vehicle. We encourage your participation and loolc forward to your presence for the tour. So that we can plan group size for the tour please RSVP by calling 322-2004 no later than September 2, 1994 by 4:00 p.m. Sincerely, Ron Wasmund Community Development Director � � PrintedonrecYcledPaVer conn.inine 30' posPmnsumer materi�:�. i � 1 MEMO TO: Chairperson Carroll Commissioners Anderson, Busho, Edwards, McMenomy, Miller, Wippermann FROM: John Miller, Economic Development Coordinator DATE: September 2, 1994 RE: Withdrawal of Motel Proposal by Central Group Companies The attached correspondence dated September 1 from Central Group Companies represents that company's withdrawal from Rosemount. Central Group Companies had been working with Rosemount for several months on the location of a Country Inn motel in the city. In the middle of July I had verbal confirmation of the company's decision to locate in Rosemount on the Carlson Tractor site. Concurrent with the work to attract Central Group Companies to Rosemount was an effort to redevelop the Carlson Tractor site. Here discussions with Carlson Properties, the school district, Springsted Inc., city of Rosemount staff people, and other possible developers occurred. With the submittal of the request by Carlson Properties for creation of a redevelopment district and correspondence dating back to early August from Central Group Companies, it appeared two signif'icant goals were being met: • Rosemount was going to get a quality motel bringing benefit from the National Guard Armory and community center to the city's business community; and, • Redevelopment of the city's 100 percent corner was going to start, tying the new and established commercial areas together. Unfortunately the situation became somewhat confused and muddied and Central Group has left. I should add that Central Group had verbally agreed to provide its own financing for the project asking only for TTF redevelopment funds. In addition, I ha�e heard the company has been invited to participate in the Apple Valley motel project. I will be looking for direction from the commissioners on the issue of motel development. Do I continue the board's directive of July, 1992 of "find a motel" or does the board want to take a different direction? If you wish, I can outline some options. � , SEP— 1-94 THU 13 :05 CTRL GRQUP �O 6126541�91 P. 02 ` • . ��fZ�'l� Septe�mber 1, 1994 �� Co�npanucs SM Mr. Thomas D. Burt Executive Director Port A�thQriCy Gity of Rc�semou�t'� 2$75 West 145th Str�et P. 0. Box 510 Rosea►ount, MN 5506$-4510 �ear Mr� Burt, I am writin� wi�h rega�d to oux' prapos�.l for fin�r►cial assiStanae to dev�lap � 46�una�t Gount�y Tnn in Rasemount, Minnesota. Please be advised that we hav� been unsuceessful at securiz�� dur selected locatian on the s4uthwest quadrant of Caunty Road 42 and State Hi�hway 3� in the City of Rosemount. We hav'e considered alternati.ve lacations for the development of the motel� but have c�me to the cdnclusiaz� that, ta insure th� laest ap�artunity faz� a suacess£uY projec�., the area �f Iand currently owned by Carl5ol� Tractor is the anly paecel we would consa.der. As yau a.�e aware, �here is an�ther �roup expres��ng interest i.n doing a pxoject similar to ours �n Rasemount. Ybu assisted us in arran�ing a meetin$ wxth this I group zn hopes tk�at �oth pa�ti.es could come together, and the Ci�y pf Rosemaunt cc�ul.d fina].�y be the benefa.ctax� c�f a lodging �acility it does n�ed. The conolusion oP the meeCing was that� the other party is nat i.nterested a.n bein� � parti,cipant iza our �raup, and has b�ez� talking to the Carlson Tractor people l a6aut the same loc�,ti.o�n. 'fhis is causing a considerable amount a� uneasiness and � confusion Por the �aroperty owner. It a��ears they a�`e being pre��ured into choosing wi.th whom to d� business, alung with looking out For their lon�-ran�e interest and the i.mminent relocati4n of tk�� Carlson Tractor £acility. A� such, I we h�ve been unable ta secur� the laz�d and enter into a purchase a.greement. � At the time of dvr first cont,act with the City of Rosemoun� we were not infarmed af any other parties int�rest�d in developing a motiel p�`oject. I alsd want to point out that we w�re cantacteci by the City a� kosemc�unt far our considerati�bn of the development of a. m+�t�I praperty. Because af the rece�tt turn of events, and our inability to adhere to the timefrarne for which we had ariginal7,y p�anned, I am �dvising yau that Central I Group CQmpanies is w�thdrawin$ its proposal e��`eetive immediately. I r�ques� that the infoz�matian we submitted to you be immediat�ely returned ta us, including 1 the pt-eliminary project cost brea�Cdvwns and oashflow projectians, whi.ch are canfid�ntial and �.xclusive information. � i 2700 � !st Stre�t North, Suire 202 •St. Clarr�l, Minnesota 56303 +(612)654-6307•{FAX){�12) 654-1291 .... ., . .r. _ _ r__.__._..:_,�.._... r,...�,..,1 l:...,.�.,/l��ialnri�nvn�('n./(�nrttrn��!'01tD iultllL2ffElii!'AI�0./HvsPifctltty Contrc�Ct Pufcltpsirtg,tnG• SEP- 1-94 THU 13 :05 CTRL GROUP CO 61�s541291 P. 03 M .� � Mr, Thom�s A. Bur'� Septemb�x 1, 1994 P�,ge Twa It is unfortuna�e that we s.re unable to hri.n$ to the Cit�► oY �tosemount a wel.�.- m�t7aged and beau'ti£uI addit�dn tc+ the Coromunity. SinCere�y, G�tO OPMENT C�. ney quist Senior Vice k�z'es4d�ent Develapment RLL/kjc �nclosure cc: Rabez��s H. Pace, President/CEO John MiL1er, Econamic Development Coordinator Ranald �arlson, Property �wner l MEMO TO: Chair Carroll Commissioners Anderson, Busho, Edwards, McMenomy, Miller, Wippermann FROM: John Miller, Economic Development Coordinator DATE: September 6, 1994 RE: HRA Memo Attached please fmd correspondence from the Dakota County HRA. Kari Gill and Diane Nordquist will be in attendance at the meeting tonight to discuss the attached information. dw attachment ,AUG-31-94 WED 10 :30 PM DAKOTA COUNTY HRA 451 7250 P. 02 -• f-' Hous't�g �.�eaeve�opment A.uthority o�z-�z3-4cwo DAI�OTA COUN'�Y 2496-i45th St•W� • Ruscmuunt,i�IN 73o6b•T.L�.�-diZ-4:3•8t8,Z•FA:C612-427-81t�0 MEM�RANDUM TO: Rosemount Port Authority FR�M: Dakota County Housing and T�.ed�velopment Authority DATE= September 6, 1994 SUBJECT: Rasemount Senior Housing Development Update At the June 21, 1994 Rosemaunt Port Autharity meeting, the Dakota County HRA presented estimated costs for construction of an all two story saniar build�.ng to �ddress neighborhood concerns regarding the scale of the new builcling. Costs included additional constructien and land acquisition costs. After reviewing these casts, the Port Authority agreed that th� HRA should explore less costly aptions incl.ud�.ng designing a three story building with only a portion two story. si.nce this meeta.ng, HR.A cQnsu].t�ng archit�ct Victor Zeuthen has prepared two conceptual building elevations and site layouts far a three story buiJ.ding with two story elements which we will bring to the September 6 meetinq. In addition, the HRA received an of�icial notice from Peop�e�s NatuXa]. G�:s xegarding the cost ta move the gas line currently located in tha center of the site. Based �x� thE relatively affordable cost, the HRA has r�quested that the gas company proceed with removal of the line (see attached letiters} . Remaval of the qas line and using a combinatian of two and thzee stary space allows for the building to be accommodated �n the original site as approved in the Co�peration Agreement. HRA stafP wi21 con�inue ta work on ideas for a combination one and two story building. Tt is our goal far the building to be designed to stay within the existing construction budget. The ideas presented at this time are in the concept stage only, the final design ar►d details will be worked out at a later date. The HRA has started the site acquisition process. An appraiser has been hired and will start With properties along Cam�o Avenue including the duplex on Lower �.4?th street. Tt is anticipated appraisals will b� complete, offers made, and purchase agreements signed by tha end of this year. "AN EQL'AL OPPORTUNZTI�'�MPLOYEP�" _ _ ,AUG-31-94 WED 10 :31 PM DAKOTA COUNTY HRA 451 7250 P. 03 ' . AU� 1 T f9�� .:,�:w �::�.r . :�.:� . _ ti -�,�,� . ;��_:_.:.-�G P�OPL�S �ATtJRAL �AS �if�%;3a;.��t• 2665145N St West 612-d23-5960 -:��.__� P.4.8ox a55 '�'�,�` flusemoun�MN 55068-0455 . August 9 , 1.994 Diane Nardquist Dakora Coun.ty HRA 2496 145th Street RosEmount, Nav 55d26 RE : Relocarian 4f Rosemcunt 12egula�or Statian #3 Dear Diane : Peoples Na�ural Gas has reviewed youx' x'eques� to remdve or relocate Peo�les ` D�,strict Regu�.atox S�ation number 3 (DRS #?) �n Rosamoun�, MN. To an.alyz� the ramifications oF remcv�ng or relocating this facility, our Engineering departmer_t has crea�ed a compu��r model of the Ras�mount n�rural gas dis�x�bution systzm, when DRS #3 is rEmoved from �he modeZ, system fazlu�e occurs . The�etore, opCions far reloca�ing the s�a�ion were examined. It was detezmzned that the station coulci be relocated and tha� a suitabl.e sita far a reloca�ed station would be in �he vicinity of the intersection of Shannan Parkway and 1.45Ch S�reet . In the e�rent Ghat you� proj ect wi],� require the relocation o� DRS ##3, a non-reE•�ndable con�r�bution in aid oE cans�ructi.o�. o� $10, QOd will b� zequired. Tkz�s cost is valid through the 1995 construc�ion year. Pl.ease contact me if y4u have any questions . Sincerelyt • �,�-;?h � _ �__.. ButCh McConnelJ. Operations Admi.nistrator cc= D , Perran AUG-31-94 WED 10 :31 PM DAKOTA COUNTY HRA 451 7250 P. 04 . �� ' � � j DAKOTA ��Uh'T�' �ousin�6t Redevelopmenc Auchority 6ia�z3-��a ?496,14�eh Sc.`X/. • Rusamuun�.MN�iQ63 •Z'•D-D.dIL4Z7-�132 =FAX 61?--F3J•81� Augu�t 22, 199� Butch McConnell Peoples Natural Gas 266� 145�h Street West P. O. Box �55 Rosemount, MN 5SOb8-0455 RE: ReJ.ocatioz� of Rasemount bistrict Regulator Statidn (DRS} ,�� Deax Mr. McCann��]., This letter is in respanse to yocir letter dated August 8 , ].994 �egarding the r�moval of Peopies Na�ux'al Gas DRS �3 S.zt Rosemount, MN. �n your Ietter i� is stated that a $].o, oQO ncrn-refundable contribution �.s needed to aid in the zelocation af DRS ,�3 . The Dako�� Caunty Housing and Red�ve].opment Authority is agreeable to this amount and wouJ.d ].�ke ta formally request that Peoples Natuxal, Gas procc�ed with removaJ. af the exis�ing �as J.�.ne and rel.ocation. of DRS #3 as saan as passible. _ Please let us know when �eoples Natural Gas w�,�1 require the $ZO, Ooo payznent from Che HRA. I� you need any more assistanc� z�eqarding this matter, please call , Diane Noxdquist of aur o�fice at �423-$1�.2 . Thank you. Sinc�rely� �'`� Mark U1Pers Executive Director ♦ ' �� . .�!'� `.,�`-� .`�,..�, ..� ,�,�.`�� , -�� . , , . ,., - �