Loading...
HomeMy WebLinkAboutResolution No. 345-07 42 • CITY OF ROCHESTER COUNTY OF OLMSTED STATE OF MINNESOTA RESOLUTION NO.,-VE'07 RESOLUTION APPROVING DEVELOPMENT DISTRICT PROGRAM AND TAX INCREMENT FINANCING DISTRICT 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. 37 (the "Development District"); adopt the Development Program for the Development District; and establish therein Tax Increment Financing District No. 37-1 (the "TIF District") and adopt the 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 469.174 through 469.179; all as reflected in that certain document entitled in part "Development District No. 37 of the City of Rochester,Minnesota," dated July 16, 2007, 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 to 30 days prior notification of the public hearing to the County Commissioner representing the area proposed to be included in the TIF District, a review of the Plans by the Rochester Planning and Zoning Commission, delivery of the Plans to the County Auditor and School District Clerk at least 30 days prior to the public hearing, and the holding of a public hearing 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 and to the activities contemplated therein, including but not limited to the Redevelopment Eligibility Report dated June 12, 2007 prepared by TSP Architects in Rochester, Minnesota,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 TIF District meets the so-called"but for" test; (2) the "reasons and supporting facts" for the finding herein that the new TIF District satisfies the applicable criteria for a "redevelopment tax increment district; and(3)the bases 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. • 2036341v1 • Section 2. Findings for the Adoption and Approval of the Plans. 2.01 The Council hereby finds that the TIF District is in the public interest and is a redevelopment district, as defined in Minnesota Statutes, Section 469.174, Subdivision 10(a)(1), because the following conditions are met and are reasonably distributed through the TIF District: (1)parcels consisting of at least 70% of the area of the TIF District are occupied by buildings, streets,utilities,paved or gravel parking lots or similar structures; and(2)more than 50% of the buildings are "structurally substandard" (within the meaning of Minnesota Statutes, Section 469.174, Subdivision 10(b)) to a degree requiring substantial renovation or clearance. These findings are based in part upon on-site examination made,written analysis and information provided by City officials and consultants and on other reasonably available photographic and other evidence, and the inspections and reports referenced therein substantiating the structurally substandard nature of the building. Reference is hereby made to the H/G TIF Study dated June 12, 2007 prepared by TSP Architects in Rochester,Minnesota, (the "Report") relating to the TIF District and its qualification as a "redevelopment" tax increment district,including without limitation all findings provided and all reports and documentation referenced therein. 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 proposed development includes a 99-story building for retail, office and student housing. The project would not be developed by private enterprise in the reasonably foreseeable future because of the high costs of acquisition and demolishing the existing substandard buildings. The project has a financing gap that needs to be funded with tax increments and other public funds. (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 development contemplated on the property is in accordance with the existing zoning for the property. The existing buildings located in the Tax Increment District are substandard, obsolete and dilapidated. (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: 2036341vl 2 • The proposed development to occur within the Tax Increment Financing District will encourage the expansion of retail, commercial and housing facilities in the City and will increase the taxable market valuation of the City. 2.03 The Council further finds that the Plans 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 Development District No. 37. 2.04 For purposes of compliance with Minnesota Statutes, Section 469.175, Subdivision 3(2), the Council hereby finds that the increased market value of the TIF District that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed redevelopment after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the Tax Increment Plan,which for these purposes is an assumed period of 26 years of full increment respecting the payable 2010 through the payable 2035 property tax years. In making these findings, the Council has duly noted the fact that the subject property is in need of redevelopment and would likely remain unredeveloped if the proposed development did not go forward, it being unlikely or at least uncertain that an alternate project would appear for the subject site. Thus, the Council cannot reasonably assume that there would be an increase • in the market value of the site without the aid of tax increment financing and the completion of the new development. In addition, based on current written estimates provided by and preliminary discussions with the Olmsted County Assessor, it appears that the market value for property tax purposes upon completion of the development would be approximately $12,316,800; subtracting from that number$1,316,800 (the Assessor's current market value of the property) yields a net increase in the market value of$11,000,000. The expected tax increment is estimated to be$224,284 per year, starting in 2010, using an assumed tax capacity rate of 1.166%on the estimated$192,335 of captured tax capacity. Using a present valuing factor of 6.00%, the present value of the maximum 26-year stream of increments (2010 through 2035, is $3,022,365. The present value of the tax increments subtracted from the increased market value is approximately$7,000,000,which is substantially more than the$0 increase in market value without tax increment financing. Thus, the development on these analyses 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. Section 3. Approval and Adoption of the Plans. 3.01 The Plans, 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 request the Olmsted County Auditor to certify the new TIF District. • 2036341vl 3 • PASSED AND ADOPTED BY THE COMMON COUNCIL OF THE CITY OF ROCHESTER,MINNESOTA, THIS 16TH DAY OF Y, 2007. PRESIDENT OF SAID COMMON COUNCIL ATTEST: CITY E Approved this 16`h day of July, 2007. (Seal of the City of Rochester,Minnesota) MAYOR OF SAID CITY • • 20363410 4 • Councilmember MARCOUX moved the adoption of the foregoing resolution, which motion was duly seconded by Councilmember NOWICKI and upon vote being taken thereon,the following Councilmembers voted in favor thereof. President Dennis Hanson, Councilmembers Pat Carr, Ed Hruska, Marcia Marcoux, Sandra Means, Bob Nowicki , Bruce Snyder and the following Councilmembers voted against the same: None whereupon said resolution was declared duly passed on adopted. • • 2036341vl 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 and regularly held meeting of the Common Council of said City held on July 16, 2007, 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 the tax increment and related actions referenced therein with respect to the City's Development District No. 37 and Tax Increment Financing District No. 37-1 therein. WITNESS My hand officially this /7-ti day of 2007. City C erk Rochester,Minnesota • (SEAL) • 2036341v1 • NOTICE OF PUBLIC.HEARING CITY OF ROCHESTER COUNTY OF OLMSTED STATE OF MINNESOTA NOTICE IS HEREBY GIVEN that the Common Council (the "Council") of the City of Rochester, Minnesota, will hold a public hearing on Monday, July 16, 2007, at a meeting of the Council beginning at approximately 7:00 p.m., Central Time, in the Council/Board Chambers located in the Government Center, 151 4th Street SE, Rochester, Minnesota, relating to the proposal that the City establish its Development District No. 37 (the "Development District"); adopt the Development Program for the Development District; and establish within the Development District Tax Increment Financing District No. 37-1 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 469.174 through 469.179. A copy of the documentation proposed to be considered at the hearing will be on file and available for public inspection at the office of the Council Administrator at the Rochester City Hall at least 10 days prior to the public hearing. Adjacent to this notice is a map which shows the area of the proposed Tax Increment Financing District No. 37-1, where the increments may be collected and expended pursuant to • the provisions of Minnesota Statutes, Sections 469.174 through 469.179, and the Development District. The increment may be expended both within the development site of Tax Increment Financing District No. 37-1 and elsewhere within the Development District. All interested persons may appear at the public hearing and present their views orally or in writing. Judy Scherr City Clerk 2036341v1 Proposed Development District # 37 and Tax Increment Financing District # 37-1 3rd St. SW aj Q 1 m 1 I i Proposed TIF - !Distr-ict4t-37 1- r--- i North 4th St. SW