HomeMy WebLinkAboutResolution No. 341-10 -- asca6t Cff-e�--
CITY OF ROCHESTER
• COUNTY OF OLMSTED
STATE OF MINNESOTA
RESOLUTION NO. I-I
RESOLUTION APPROVING A DEVELOPMENT DISTRICT
AND DEVELOPMENT PROGRAM THEREFOR
AND APPROVING A TAX INCREMENT FINANCING DISTRICT
AND A TAX INCREMENT FINANCING PLAN THEREFOR
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 its Development District No. 39 (the
"Development District"); adopt the Development Program for the Development District; and
establish Tax Increment Financing District No. 39-1 within the Development District and adopt
the related Tax Increment Financing Plan therefor(collectively,the "Plans"); all pursuant to and
in conformity with applicable law, including Minnesota Statutes, Sections 469.124 through
469.134 and Sections 469.174 through 469.1799, as amended; all as reflected in that certain
document entitled in part"Development District No. 39 of the City of Rochester, Minnesota,"
• dated June 7, 2010, and presented for the Council's consideration.
1.02. The Council has investigated the facts relating to the Plans.
1.03. The City has performed all actions required by law to be performed prior to the
adoption and approval of the Plans, including but not limited notice to the County Commissioner
representing the area of the County to be included in the Tax Increment Financing District No.
39, delivery of the Plans to the County and School Board, a review of the Plans by the Rochester
Planning and Zoning Commission, and the holding of a public hearing by the City thereon
following notice thereof published in the City's official newspaper at least 10 but not more than
30 days prior to the public hearing.
1.04. Certain written reports and other documentation(collectively,the "Reports")
relating to the Plans, including the tax increment application made and other information
supplied by Kutzky Park LLC, a Minnesota limited liability company (the"Company"). The
report dated September 16, 2009 prepared by Yaggy Colby Associates as to the condition of the
property in the Tax Increment District have heretofore been assembled or prepared by staff or
others and submitted to the Council and/or made a part of the City files and proceedings on the
Plans. The Reports include data, information and/or substantiation constituting or relating to (1)
the "studies and analyses" on why the new Tax Increment District meets the requirements to be a
redevelopment tax increment financing district, (2)why the assistance satisfies the "but for"test
and(3)the basis for the other findings and determinations made in this resolution. The Council
hereby confirms,ratifies and adopts the Reports, which are hereby incorporated into and made as
• fully a part of this resolution to the same extent as if set forth in full herein.
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Section 2. Findings for the Adoption and Approval of the Plans.
2.01. The Common Council hereby finds that Tax Increment Financing District No. 39-
1 is in the public interest and is a"redevelopment district"within the meaning of Minnesota
Statutes, Section 469.174, Subdivision 10(a)(1), because the Tax Increment Financing District
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 Minnesota Statutes, Section
469.174, Subdivision 10(b))to a degree requiring substantial renovation or clearance. The
District consists of fifteen parcels, and seven of the parcels are"occupied" as defined in
Minnesota Statutes, Section 469.174, Subd. 10(a)(1), in that at least 15% of the area of the
parcels, are occupied by buildings, streets, utilities,paved or gravel parking lots, or other similar
structures. There are eleven buildings in the Tax Increment District, and seven buildings are
structurally substandard to a degree requiring renovation or clearance. In addition, the costs of
bringing the structurally substandard buildings into compliance with building codes applicable to
new buildings would exceed 15% of the cost of constructing new structures of the same size and
type on the site.
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 project will occur would not be
developed in the reasonably foreseeable future. The land assembly
and redevelopment costs are higher than normal for a project of
this size. The developer has represented that it could not proceed
with the 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 mixed use 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 whole
for the development of the Tax Increment Financing District by private enterprise. The
• specific basis for such finding being:
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I
• The proposed development to occur within the Tax Increment
Financing District is a mixed use housing and commercial
development and is in an area targeted for redevelopment by the
City. The development will increase the taxable market valuation
of the City, and the available commercial facilties and housing
units in the City.
(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.,
$2,894,481) after subtracting the present value of the projected tax increments for the
maximum duration of the Tax Increment Financing District (i.e., approximately
$943,285). 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.
I s
(b) The Loans may be advanced if and as needed from available monies in the
• 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).
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(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.
PASSED AND ADOPTED BY THE COMMON COUNCIL OF THE CITY OF
ROCHESTER, MINNESOTA, THIS 16' DAY OF AUGUST, 2010.
• PRESIDENT OF SAID COMMON COUNCIL
ATTEST:
—'CITY CLEIT
Approved this 1`7 day of August, 2010.
MAYOR OF SAID CITY
(Seal of the City of
Rochester, Minnesota)
•
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Councilmember Wojcik moved the adoption of the foregoing
• resolution, which motion was duly seconded by Councilmember Bilderback ,
and upon vote being taken thereon, the following Councilmembers voted in favor thereof:
President Pro-Tem Bob Nowicki, Councilmembers Mark Bilderback, Ed Hruska, Sandra
Means, Bruce Snyder, Michael Wojcik
and the followingCouncilmembers voted
o against the same: None
whereupon said resolution was declared duly passed on adopted.
•
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