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HomeMy WebLinkAbout6.b. TIF Spending Plan – Project Criteria EXECUTIVE SUMMARY Port Authority Date: November 15, 2022 AGENDA ITEM: TIF Spending Plan – Project Criteria AGENDA SECTION: New Business PREPARED BY: Eric Van Oss, Economic Development Coordinator AGENDA NO. 6.b. ATTACHMENTS: TIF Spending Plan APPROVED BY: LJM RECOMMENDATION: Information Item. BACKGROUND In 2021, the Legislature enacted expanded, temporary authority to transfer unobligated tax increments for purposes of assisting private development consisting of the construction or substantial rehabilitation of buildings and ancillary facilities, if doing so will create or retain jobs in the state. The new law temporarily permits a development authority (Rosemount Port Authority) to elect, by resolution, to transfer unobligated increment for certain specified purposes provided the following criteria are met: 1. It consists of the construction or substantial rehabilitation of buildings and ancillary facilities; 2. It creates or retains jobs in the state, including construction jobs; and 3. Construction commences before December 31, 2025 and would not have commenced before that date without the assistance. On November 1st, the City Council approved the TIF Spending Plan. This allowed the City to transfer approximately $2.857 million from the Downtown Brockway TIF District to a separate account by December 31st, 2022. The funds must be allocated to projects by December 31st, 2025 or they will revert to the originating district. The City Council approves the spending plan, while the Port Authority is the body that will approve (by resolution) the transfer of funds for specific projects. Upon the approval of the TIF Spending Plan, staff began drafting implementation criteria in anticipation of forthcoming projects. This allows the City to add another “tool” within our economic development toolbox. To best utilize these funds minimum project criteria should draw from existing City policies, goals, and strategic documents. Projects that further the goals outlined in the Comprehensive Plan, Commercial Visioning, and the Council’s Strategic 2022 goals would be prioritized. Additionally, several sites that are not outlined in official policy documents have long been discussed for redevelopment, and those sites will also be prioritized for funding. As this is a Business Subsidy, staff feels it is appropriate to benchmark projects to the economic and redevelopment goals outlined in the Business Subsidy Policy. The City will default to the Legislature’s job creation requirements outlined in the enacting statutes. 2 The City’s economic and redevelopment goals for subsidies are as follows: • Projects that provide value in the forms of needed transportation and other utility infrastructure improvements including regional infrastructure in the community that would be completed in conjunction with the project. • Redevelopment projects that result in the stabilization of business districts or neighborhoods by elimination of blighting conditions. • Projects that create new business or residential opportunities in Downtown Rosemount. • Projects that enhance or increase the economic diversity of the community by attracting businesses or industries not currently located in the City. • Projects that result in the development of affordable, senior, or workforce housing. • Multi-family housing with high-amenities considered market rate. • Quality of Life based on business/projects. Those business/entities that provide a desirable good or service and address an unmet demand in the community will be considered. • Provides opportunity for the attraction of destination-oriented uses such as outdoor recreation, entertainment and shopping. In terms of application process, this program could run similarly to the “opt-in” Sewer Availability Charge (SAC) Grant program. Projects that meet the development or redevelopment criteria or are located on “priority” sites will notified of their eligibility to submit for a business subsidy. Funding amount may range from $25,000 to $500,000. Developers will be asked to complete the Business Subsidy Application. Unlike other TIF projects, the “but-for” statement is not required with the spending plan, as long as the three criteria are met: (1) construction of buildings; (2) jobs; (3) commencement prior to Dec. 31, 2025; however, the City can choose do a complete analysis or request a statement from the developer. Upon the application for a business subsidy the Port Authority will consider each project individually and successful projects would be allocated funding via resolution. For projects seeking over $150,000 in assistance a public hearing would be required prior to Port action. RECOMMENDATION None, informational update only. Adopted: November 1, 2022 Rosemount City Council City of Rosemount, Dakota County, Minnesota Spending Plan Tax Increment Financing Downtown Brockway District City of Rosemount Spending Plan for Downtown Brockway TIF District 1 Spending Plan for Tax Increment Financing District PURPOSE The Rosemont Port Authority (the “Authority”) administers Tax Increment Financing Downtown Brockway District (the “TIF Districts”) in the City of Rosemount, Minnesota (the “City”), and proposes to adopt a Spending Plan for the TIF Districts in accordance with Minnesota Statutes, Section 469.176 Subd. 4n (the “Act”). The Act grants the Authority temporary authorization to transfer unobligated tax increment to provide improvements, loans, interest rate subsidies or assistance in any form to private development consisting of the construction or substantial rehabilitation of buildings and ancillary facilities, which will create or retain jobs in the State, including construction jobs, so long as such private development commences no later than December 31, 2025, and would not have commenced before that date without such assistance. Such transfers must be made by resolution, pursuant to the terms of a spending plan approved by the Authority and by the City, following a public hearing of the City Council. PLAN The Authority is authorized as follows: (a) To use available tax increments from the TIF Districts to provide assistance in connection with a private development consisting of the construction or substantial rehabilitation of commercial, industrial, residential and/or mixed-use buildings and ancillary facilities requiring a minimum of $25,000 and no more than $500,000 in financing assistance. Preference will be given to projects on parcels targeted for redevelopment that further the goals set forth in the City’s Comprehensive Plan and the City’s other strategic planning documents, and which will result in the creation and retention of jobs in the State, including construction jobs. (b) To amend the budget set forth in the Tax Increment Financing Plans for the Tax Increment Financing Districts as necessary to provide for the assistance authorized by this Spending Plan. (c) To take any other action necessary and authorized under the Act in connection with the construction or substantial rehabilitation of facilities of the type described in clause (a) above. The assistance provided pursuant to this Plan shall be subject to Minnesota Statutes, Sections 116J.993 to 116J.995 (the “Business Subsidy Law”), if applicable, and shall be subject to the City’s Business Subsidy Policy.