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HomeMy WebLinkAboutResolution No. 073-06 CITY OF ROCHESTER • COUNTY OF OLMSTED STATE OF MINNESOTA RESOLUTION NO.,213-00 RESOLUTION APPROVING DEVELOPMENT PROGRAM AND TAX INCREMENT FINANCING PLAN BE IT RESOLVED by the Common Council (the "Council") of the City of Rochester, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01. It has been proposed that the City establish Development District No. 33 (the "Development District"); adopt the Development Program for the Development District (the "Program"); and establish within the Development District, Tax Increment Financing District No. 33-1 (the "TIF District") and adopt a Tax Increment Financing Plan therefor (the "Plan"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.124 through 469.134 and 469.174 through 469.179; all as reflected in that certain document entitled in part "Development District No. 33 of the City of Rochester, Minnesota," dated October 17, 2005, and presented for the Council's consideration. • 1.02. The Council has investigated the facts relating to the Program and the Plan. 1.03. The City has performed all actions required by law to be performed prior to the adoption and approval of the Program and Plan, including but not limited to 30 days prior notification of the County Auditor, School District Clerk and the individual County . Commissioner, a review of the Program and Plan by the Rochester Planning and Zoning Commission, and the holding of a public hearing thereon following notice thereof published in the City's official newspaper at least I0.but not more than 30 days prior to the public hearing. Section 2. Findings for the Adoption and Approval of the Program and Plan. 2.01. The Common Council hereby finds that Tax Increment Financing District qualifies as a "redevelopment district" within the meaning of the Tax Increment Act for the following reasons: The Tax Increment Financing District is, pursuant to Minnesota Statutes, Section 469.174, Subdivision 10(a)(1), a "redevelopment district"because it consists of a project or portions of a project within which the following conditions, reasonably distributed throughout the District, exist: (1)parcels consisting of at least 70% of the area of the District are occupied by.buildings, streets, utilities,paved or gravel parking lots,or other similar structures; and (2)more than 50% of the buildings located within the Tax Increment Financing District are "structurally substandard" (within the meaning of • t 1861G47v1 r • Minnesota Statutes, Section 469.174, Subdivision 10(b)) to a degree requiring substantial renovation or clearance. The District consists of 1 parcel, and that parcel is occupied by buildings, streets, utilities, paved or gravel parking lots, or similar strictures. At least 15% of the area of that parcel is occupied by such structures. There is one building located on the parcel in the Tax Increment District, and that building is structurally substandard to a degree requiring substantial renovation or clearance. The building is structurally substandard because it contains defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance. The costs of bringing the structurally substandard buildings into compliance with building codes applicable to new buildings would exceed 15% of the cost of constricting new structures of the same size and type on the sites. The supporting facts for these determinations are on file with the staff of the Authority and include but are not limited to the report of TSP dated December 1, 2005. 2.02. The Common Council hereby makes the following additional findings in connection with the Tax Increment District: (a) The Common Council further finds that the proposed development,in the • opinion of the Common Council,would not occur solely through private investment within the reasonably foreseeable future and, therefore, the use of tax increment financing is deemed necessary. The specific basis for such finding being: The property on which the housing project will occur would not be- developed in the reasonably foreseeable future because it contains a blighted building that has been vacant and underutilized for many years. The developer has represented that it could not proceed with the housing project without tax increment assistance. (b) The Common Council further finds that the Tax Increment Financing Plan conforms to the general plan for the development or redevelopment of the City as a whole. The specific basis for such finding being: The Tax Increment Financing Plan will generally compliment and serve to implement policies adopted in the City's comprehensive plan. The housing development contemplated on the property is in accordance with the existing zoning for the property. (c) The Common Council further finds that the Tax Increment Financing Plan will afford maximum opportunity_consistent with the sound needs of the City as a V0,1ole for the development of the Tax Increment Financing District by private enterprise. The • specific basis for such finding being: 1861647vl 2 • The proposed development to occur within the Tax Increment Financing District is housing. The development will increase the taxable market valuation of the City, and the available housing in the city will.be expanded by approximately 66 units of rental housing. (d) For purposes'of compliance with Minnesota Statutes, Section 469.175, Subdivision 3(2), the City Council hereby finds that the increased market value of the property to be developed within the Tax Increment District that could reasonably be expected to occur without the use of tax increment financing is $0, which is less than the increased market value estimated to result from the proposed development (i.e., $1,778,100) after subtracting the present value of the projected tax increments for the maximum duration of the Tax Increment Financing District (i.e., approximately $350,000). In making these findings, the City Council has noted that the property has not been redeveloped for many years and would likely remain so if tax increment financing is not available. Thus, the use of tax increment financing will be a positive net gain to the City, the School District, and the County, and the tax increment assistance does not exceed the benefit which will be derived therefrom. 2.03. The provisions of this Section 2.02 are hereby incorporated by reference into and made a part of the Tax Increment Financing Plan. 2.04. The Council further finds that the Program and-Plan are intended and in the • judgment of the Council their effect.will be to promote the public purposes and accomplish the objectives specified in the Tax Increment Financing Plan for the TIF District and the Development Program for the Development District. Section 3. Approval and Adoption of the Program and Plan; Policy on Interfund Loans and Advances. 3.01. The Program and Plan, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the City Clerk. City staff shall, in writing, request the Olmsted County Auditor to certify the new TIF District. 3.02. The Council hereby approves a policy on interfund loans or advances ("Loans") for this Tax Increment District, as follows: (a) The authorized tax increment eligible costs (including without limitation out-of-pocket administrative expenses)payable from the District, as its TIF Plan is originally adopted or may be amended,may need to be financed on a short-term and/or long-term basis via one or more Loans, as may be determined by the City Finance Director from time to time. (b) The Loans may be advanced if and as needed from available monies in dze City's general fund or other City fund designated by the City Finance Director. Loans may be structured as draw-down or"line of credit" obligations of the lending fund(s). 1861647vl 3 f • (c) Neither the maximum principal amount of any one Loan nor the aggregate principal amount of all Loans may exceed the adopted and, if applicable, amended TIF Plan budget for the Tax Increment District. (d) The maximum term of any Loan shall not exceed the lesser of the statutory duration limit of the Tax Increment District or such earlier date as the City Finance Director may specify in writing. All Loans may be pre-paid, in whole or in part, whether from tax increment revenue, TIF bond proceeds or other eligible sources. (e) The outstanding and unpaid principal amount of each Loan shall bear interest at the rate prescribed by the statute (Minnesota Statutes, Section 469.178, Subdivision 7), which is the greater of the rates specified under Sections 270.75 or 549.09 at the time a Loan, or any part of it, is first made, subject to the right of the City Finance Director to specify a lower rate (but not less than the City's then-current average investment return for similar amount and term). (f) Such Loans within the above guidelines are pre-approved. The Loans need not take any particular form and may be undocumented, except that the City Finance Director shall maintain all necessary or applicable data on the Loans. • • 1 ssi 6a7vl 4. • PASSED AND ADOPTED BY THE COMMON COUNCIL OF THE CITY OF ROCHESTER, MD TNESOTA,THIS DAY OF , 2006. PRESIDENT OF SAID COMMON COUNCIL ATTEST: ,i CI T CLERK Approved this day of , 2006. (Seal of the City of Rochester, Minnesota) MAYOR OF SAID CITY Councilmember Marcoux moved the adoption of the foregoing resolution,which motion was duly seconded by Councilmember Carr , and upon vote being taken thereon, the following Councilmembers voted in favor thereof: President Dennis Hanson, Councilmembers Amy Blenker, Pat Carr, • Marcia Marcoux, Sandra Means, Bob Nowicki and the following Councilmembers voted against the same: None whereupon said resolution was declared duly passed on adopted. a r t� f 1 ; 3 1851647v1 5 • CITY CLERK'S CERTIFICATE I, the undersigned, being the duly qualified and acting City Clerk of the City of Rochester, Minnesota, DO HEREBY CERTIFY that I have carefully compared the attached and foregoing extract of minutes of a duly called regularly held meeting of the Common Council of said City held on February 6, 2006, with the original minutes thereof on file in my office and I further certify that the same is a full, true, and correct transcript thereof insofar as said minutes relate to approving the Development Program and Tax Increment Financing Plan for the City's Development District No. 33 and Tax Increment Financing District No. 33-1 therein. WITNESS My hand officially and the official seal of the City this'V_ day of 2006. City Jerk Rochester, Minnesota (SEAL) t 1861647VI