HomeMy WebLinkAbout4E - Waterfront PassageSTAFF AGENDA REPORT
AGENDA #:
PREPARED BY:
SUBJECT:
DATE:
BACKGROUND:
DISCUSSION:
BONITA CARLSON, ASSISTANT CITY MANAGE
CONSIDER ESTABLISHMENT OF TAX INCREMENT FINANCING
DISTRICT NO. 2-3 (METRO CABINETS/AMERICAN GLASS) FOR THE
CONSTRUCTION OF A 10,000 SQUARE FOOT BUILDING IN
WATERFRONT PASSAGE ADDITION
JANUARY 17, 1995
Two developers, Metro Cabinet and Guy and Mary Selinske d/b/a
American Glass and Mirror, Inc., have entered into a purchase agreement
for approximately one acre which is adjacent to the Becker Arena
Products lot (on the west side) in the Waterfront Passage Addition. The
City has negotiated Development Agreements with the two parties to
provide the necessary Tax Increment Financing to allow them to construct
a 10,000 square foot multi-tenant building. A public hearing on this
project and Tax Increment Financing District was held on August 1, 1994.
A vote to establish the district was delayed until 1995 because the
development could not be constructed in 1994. By delaying
establishment of the Tax Increment District until 1995 the city will have the
opportunity to collect Tax Increment revenue for the maximum period
allowed under the law (9 years).
The developers for the project are both successful local businesses.
They are each operating in facilities which are undersized, with no
potential for expansion, and one case is an incompatible use according to
the City Zoning Code. These uses are permitted in the Waterfront
Passage Business/Office Park and are consistent with the type of
businesses envisioned by the City when the business office park was
established. The developers propose to construct a 10,000 square foot
building on a one acre lot.
The Tax Increment Plan and related development agreements requires
the development project to have a minimum market value of $273,000
upon completion. The City agrees to provide tax increment financing in
the amount of $68,000 for land write down and up to an additional
$43,650 reimbursement for site improvement and soil correction costs.
This assistance will be divided equally between the two developers. The
captured tax increment is estimated to be approximately $16,000 less
Local Government Aid (LGA) penalties of $4,500 for a net increment of
$11,500 per year which is pledged to provide the required assistance,
(reimbursement of City costs and write downs, and site improvements
costs incurred by the developer). In addition, the agreement specifies
-1-
16200 Eagle Creek Ave., Prior Lake, Minnesota 55372-1714 / Ph. (612) 447-4230 / Fax (612) 447-4245
AN EQUAL OPPORTUNITY EMPLOYER
ALTERNATIVES:
RECOMMENDATION:
ACTION REQUIRED:
Reviewed by:
City Council:Agdevl.wrt
that up to $1,600 per year additional reimbursement will be paid to the
Developers if the development generates increment in excess of the
estimated increment. Further, the City agrees to reimburse the
developers up to $3,250 per year, to a maximum of $29,250 if
redevelopment occurs on the "Triangle Car Wash" property at Highway 13
and 170th Street and produces sufficient increment to cover the payment.
All pledged tax increment financing payments will end in the year 2005
and subsequent tax payments will be distributed to the respective taxing
districts.
The City Council has the following alternatives:
1. Approve Tax Increment Financing District No. 2-3.
2. Deny Tax increment Financing District No. 2-3.
Staff recommends Alternative #1
A motion and second.to approve the attached resolution establishing Tax
Frank/l~yle~ !
City Maj3ag'e r
-2-
MOTION BY:
RESOLUTION 95-
SECONDED BY:
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PRIOR LAKE
APPROVING TAX INCREMENT FINANCING DISTRICT NO. 2-3
AND THE USE OF TAX INCREMENT FINANCING
WHEREAS, the City Council of the City of Prior Lake, Minnesota (the "City"), has previously approved
Development District No. 2 (the "Development District") and in connection therewith adopted a development
program; and
WHEREAS, it is desirable and in the public interest that the City undertake and carry out a tax increment
finance plan for Tax Increment Financing District No. 2-3 pursuant to Chapter 469 of Minnesota Statutes,
encompassing the area which is more particularly described on Exhibit A attached hereto and made a part
hereof, (which area is herein called the "District"); and
WHEREAS, the City Council has reviewed "Tax Increment Financing District No. 2-3, dated
August 1, 1994" (the "Plan Booklet"), which sets forth a tax increment financing plan for the District; and
WHEREAS, the Plan Booklet sets forth the City's estimate of the fiscal and economic impact of the
District on the tax capacities of all taxing jurisdictions in which the District is located; and
WHEREAS, the Board of Commissioners of Scott County, Minnesota, has been notified of the public
hearing for the review of the Plan Booklet; and
WHEREAS, the School Board of Independent School District No. 719 has been notified of the public
hearing for the review of the Plan Booklet; and
WHEREAS, the City has received and considered the comments of the Board of Commissioners of Scott
County and the School Board of the Independent School District No. 719 respecting the contents of the Plan
Booklet; and
WHEREAS, the City on August 1, 1994, after having published a notice of public hearing in the official
newspaper of the City, conducted a public hearing on the Plan Booklet and received public comments on
the same.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Prior Lake, Minnesota, as
follows:
1. The City finds and determines that there is a need for the activities of Development District No.
2 to be financed in part by the tax increments from the District.
2. The City finds and determines that the activities to be financed by the tax increments from the
District will carry out the objectives of Development District No. 2 by encouraging industrial develop-
ment, providing job opportunities and enhancing the tax base.
3. The City finds and determines that the provision for job opportunities and the preservation and
enhancement of the tax base are in the public interest of the City and the expenditures of the District are
a public purpose.
16200 Eagle Creek Ave., Prior Lake, Minnesota 55372-1714 / Ph. (612) 447-4230 / Fax (612) 447-4245
AN EQUAL OPPORTUNITY EMPLOYER
4. The City finds and determines that the tax increment financing plan as set forth in the Plan
Booklet having been duly reviewed and considered is hereby approved and adopted, and the area
described in Exhibit A hereto is hereby designated as an Economic Development District pursuant to
Minnesota Statutes, Sections 469.174, Subd. 12.
5. The City finds and determines that the Distdct is an Economic Development District because it
will result in increased employment in the City, and that it will result in preservation and enhancement Of
the tax base of the City.
6. The City finds and determines that the proposed development, in the opinion of the City,
would not reasonably be expected to occur solely through private investment within the reasonably
foreseeable future and therefore the use of tax increment financing is deemed necessary.
7. The City finds and determines 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 District
by private enterprise.
8. The City finds and determines that the tax increment financing plan set forth in the Plan
Booklet conforms to the general plan for the development of the City as a whole.
9. The reasons and supporting facts for findings 5, 6, 7 and 8 as set forth on pages 2, 3 and 4 of
the Plan Booklet are by this reference confirmed, approved and adopted.
10. The City elects to retain tax increment revenues generated in District No. 2-3 pursuant to
clause (a) of Minnesota Statutes, Section 469.177 Subdivision 3, Paragraphs I and 2. By making this
election tax increment revenues generated within District No. 2-3 will not be made available for
calculation or sharing with the fiscal disparity provisions of Chapter 473F.
11. The City Clerk shall request the auditor of Scott County to certify the original tax capacity and
original local tax rate of the District approved by this resolution.
12. The City Clerk is hereby directed to file a copy of this resolution with a copy of the Plan
Booklet to the Minnesota Department of Revenue.
13. The City hereby states its intention to use all of the captured tax capacity for purposes of tax
increment financing as per the conditions set forth in the Plan Booklet.
Passed and adopted this 17th day of January, 1995.
Andren
Greenfield
Kedrowski
Scoff
Schenck
YES NO
Andren
Greenfield
Kedrowski
Scott
Schenck
Frank Boyles
City Manager
City of Prior Lake
(Seal)
TAX INCREMENT FINANCING DISTRICT NO. 2-3
PRIOR LAKE, MINNESOTA
JANUARY 17, 1995
PREPARED BY
ADVANCE RESOURCES FOR DEVELOPMENT, INC.
MANKATO, MINNESOTA
TABLE OF CONTENTS
INTRODUCTION .................................................
LOCATION ........................ ; ........................
DEFINITIONS ...............................................
PURPOSE OF TAX INCREMENT FINANCING PLAN ...................
SUMMARY .................................................
TAX INCREMENT FINANCING PLAN .................................
RELATIONSHIP OF DISTRICT TO DEVELOPMENT PLAN ..............
PROPERTY CONDITIONS ......................................
NARRATIVE BOUNDARY DESCRIPTION OF THE DISTRICT ............
LIST OF PARCELS ...........................................
FINDINGS ..................................................
PLAN OBJECTIVES .........................................
DEVELOPMENT PROGRAM ...................................
DISTRICT DEVELOPMENT ACTIVITIES ............................
CONFORMANCE WITH PLAN FOR THE CITY .......................
PROCEDURE FOR MODIFYING THE DISTRICT PLAN .................
RELOCATION POLICY PLAN ...................................
PROPERTY ACQUISITION AND DISPOSITION PLAN .................
METHOD OF FINANCE ........................................
NOTIFICATION OF PRIOR PLANNED IMPROVEMENTS ...............
FINANCIAL PLAN ............................................
Page
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3
4
5
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6
6
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Follows Page
MAP
TAX INCREMENT FINANCING DISTRICT 2-3 .......................
NOTICES, RESOLUTIONS AND CERTIFICATIONS ......................
12
1. RESOLUTION CALLING FOR A PUBLIC HEARING
2. NOTICE OF A PUBLIC HEARING
3. AFFIDAVIT OF PUBLICATION
4. TRANSMITTAL TO INDEPENDENT SCHOOL DISTRICT NO. 719
5. TRANSMITTAL TO SCOTT BOARD OF COMMISSIONERS
6. RESOLUTION OF THE CITY COUNCIL APPROVING AND ADOPTING TAX INCREMENT
FINANCING DISTRICT NO, 2-3
7. CERTIFICATION OF ORIGINAL TAX CAPACITY AND ORIGINAL LOCAL TAX RATE
FOR TAX INCREMENT FINANCING DISTRICT NO. 2-3
INTRODUCTION
LOCATION
Tax Increment Financing District No. 2-3 is located in the Waterfront Passage Business Park south of
Cqunty Road 21 on the east side of Prior Lake. The map following page I shows ~he location of District No.
2-3.
DEFINITIONS
For the purpose of clarity, the following terms defined in this report shall have the meanings given them.
"Project" means development district as defined in Minnesota Statutes, Section 469.125, Subd. 9.
"Development District" means a specific area within the corporate limits of a municipality which has
been so designated and separately numbered by the governing body. "Development District" also means
Development District No. 2.
"Tax Increment Financing District No. 2-3", "Tax Increment Financing District" or "District" means a
contiguous or noncontiguous geographic area within a project delineated in the tax increment financing plan,
as provided by Minnesota Statutes, Section 469.175, Subd. 1, for the purpose of financing redevelopment,
mined underground space development, housing, or economic development in municipalities through the
use of tax increment generated from the captured net tax capacity in the tax increment financing district.
"Economic Development District" means a type of tax increment financing district which consists of any
project, or portions of a project, not meeting the requirements found in the definition of redevelopment
district, renewal and renovation district, soils condition district, mined underground space development
district, or housing district, but which the authority finds to be in the public interest because:
1. It will discourage commerce, industry, or manufacturing from moving their operations to another state
or municipality; or
2. It will result in increased employment in the state; or
3. It will result in preservation and enhancement of the tax base of the state.
PURPOSE OF TAX INCREMENT FINANCING PLAN
District No. 2-3 is being established pursuant to Minnesota Statutes, Chapter 469, in order to give the
City Council the authority to use Tax Increment Financing as a funding source. Under Chapter 469, a tax
increment district has to be established as a housing district, a redevelopment district, a mined underground
space district, a renewal and renovation district, a soils condition district or an economic development
district. Since this area qualifies as an economic development district, pursuant to Minnesota Statutes,
Section 469.174, Subd. 12, it will have a duration of not greater than nine years from the date of receipt of
the first tax increment or eleven years from the approval of the tax increment financing plan, whichever is
less.
SUMMARY
The formation of District No. 2-3 improves the quality of life in the community by financing eligible
Project costs which will result in the creation of job opportunities and increase of the tax base.
TAX INCREMENT FINANCING PLAN
RELATIONSHIP OF TAX INCREMENT DISTRICT TO DEVELOPMENT DISTRICT
Development District No. 2 was formed in order to promote development of certain property, secure
additional industrial, commercial and housing development and redevelopment opportunities, increase
property subject to taxation, provide public improvements to development properties, and designate methods
for the financing of activities in the Development District.
Development District law authorizes the use of tax increment funds to pay for these Project activities
and improvements. When using tax increment funds, it is necessary to establish a tax increment financing
district according to Minnesota Statutes, Sections 469.174 to 469.179, inclusive. Approval of this plan results
in the formation of Tax Increment Financing District No. 2-3, the purpose of which is to finance the develop-
ment activities authorized by the creation of Development District No. 2.
PROPERTY CONDITIONS
The District consists of an approximate I acre parcel which was recently incorporated as part of the
Waterfront Passage Business Park. The property is currently vacant and is appropriately zoned for its
intended use. Upon inclusion in the District, Metro Cabinets, Inc. and American Glass & Mirror, Inc. will
develop the site and construct an approximate 10,000 sq. ft. production/warehouse facility.
Financing for the project will consist of bank financing, tax increment financing and equity. The use of
tax increment financing will employ the "pay-as-you-go" method of reimbursing eligible project costs. Under
this program tax increment receipts generated from the development will be used to reimburse the City and
developer for certain qualified costs such as land, site work, sewer, water, roads, sidewalks and landscaping.
This "buy down" will occur over the life of the District or until all agreed upon costs have been reimbursed.
The intent of this method is to apply all the revenues from the "pay-as-you-go" tax increment financing to
reduce the project cost.
NARRATIVE BOUNDARY DESCRIPTION OF DISTRICT NO. 2-3
That part of the Southwest Quarter of Section 1, Township 114, Range 22, Scott County, Minnesota
described as follows:
Upon platting of the property by the City it is anticipated that the legal description for the parcel will be
identified as Lot 2, Block 1, Waterfront Passage Business Park.
LIST OF PARCELS INCLUDED IN DISTRICT NO. 2-3
The following parcel is included in District No. 2-3:
Parcel Number 25-300-004-0 will be used to identify Lot 2, Block 1, WaterFront Passage Business Park.
Presently this parcel is contained within a larger plat identified as Parcel Number 25-296-001-0.
FINDINGS
Minnesota Statues, Section 469.175, Subd. 4, requires that prior to municipality approval of a tax
increment financing plan that the statutory findings of Minnesota Statutes, Section 469.175, Subd. 3, must be
made and the reasons for those findings must be set forth in writing along with supporting facts for each
determination.
The tax increment financing plan for District No. 2-3 finds the following:
1. FINDING. That the proposed tax increment financing district is an economic development
district.
SUPPORTING FACTS. Minnesota Statutes, Chapter 469 provides for six types of districts -- a
redevelopment district, renewal and renovation district, soils condition district, a mined underground
space district, a housing district, and an economic development district -- each serving a well-defined
need and each having different qualifying standards. Tax Increment Financing District No. 2-3 is
intended to be an "Economic Development District". Minnesota Statutes, Section 469.174, Subdivi-
sion 12, defines "Economic Development District". This definition is also included on page I of this
plan.
The proposed District qualifies as an "Economic Development District" pursuant to the above
cited statute because Project activities will increase employment and result in preservation and
enhancement of the tax base of the municipality. Upon inclusion in the District the vacant property
will be developed by Metro Cabinets, Inc. and American Glass & Mirror, Inc. Inclusion of this
property in the District will in increase the community's tax base, as well as add new jobs.
2. FINDING That the proposed development or redevelopment, in the opinion of the municipality,
would not reasonably be expected to occur solely through private investment within the reasonably
foreseeable future and therefore, the use of tax increment financing is deemed necessary.
SUPPORTING FACTS. In order for the companies to develop and occupy the site project
financing must be obtained. The City of Prior Lake in conjunction with a local bank and the
developer has prepared a public/private financial package which includes owner equity, tax
increment financing and a bank fixed asset loan. The need for this type of project financing was
determined by the city with the assistance of the bank and in the opinion of city officials this
development would not occur in the City of Prior Lake without the public/private effort, including the
financial assistance offered.
3. FINDING. That the tax increment financing plan conforms to the general plan for the develop-
ment or redevelopment of the municipality as a whole.
SUPPORTING FACTS. The tax increment financing plan conforms to the general plan of the
City of Prior Lake for the following reasons:
A. The tax increment financing area is designated on the zoning map for industrial develop-
ment. Plan activities and subsequent development are intended to encourage and result in
industrial development for this area.
B. The general plan for the community supports the creation of job opportunities; particularly,
increased opportunities for Iow and moderate income individuals.
4. FINDING. That the tax increment financing plan will afford maximum opportunity, consistent with
the sound needs of the municipality as a whole, for the development or redevelopment of the project
by private enterprise.
SUPPORTING FACTS. The City of Prior Lake, in approving Development District No. 2, has
prepared a blueprint for the development and redevelopment of the community. The Development
District plan encourages cooperation with private enterprise. Information contained in the Develop-
ment District report along with other city plans and reports has been used in the preparation of the
District No. 2-3 plan. Based upon the objective of cooperation and upon the guidance provided by
city plans and ordinances, the city has determined Project costs which will be paid for by tax
increment revenues. As the Financial Plan contained on pages 6 through 12 of this report indicates,
the city intends to concentrate the use of tax increment revenue on those improvements which would
not reasonably be expected to occur solely through private action. Private enterprise will be
responsible for the vast majority of the expenses and activities normally associated with land
development.
STATEMENT OF OBJECTIVES FOR DEVELOPMENT DISTRICT NO. 2
The City Council of Prior Lake, Minnesota, determines that it is necessary, desirable, and in the
public interest to establish/modify, designate, develop, and administer a development district in the city
pursuant to the provisions of Minnesota Statutes, Sections 469.124 to 469.134, inclusive. The city council
further determines that the funding of the necessary activities and improvements in the Development District
may be financed through tax increment financing, as well as, other appropriate sources. Prior to involving
itself in financing Project activities or a development, the city council shall determine financial feasibility of the
Project or development. Any public or private activity when funded by the city shall demonstrate the need for
such financing and how said financing is going to be repaid if it is a loan. In the case of a grant or tax
increment financing, the benefits to the community, such as housing or job opportunities, increased tax base
or removal of blighting conditions, shall be demonstrated.
The city council seeks to achieve the following objectives for Development District No. 2:
1. Acquire land which is vacant or underused, including public or semi-public properties already
devoted to a public use which is underutilized.
2. Assist with land assembly for new and expanding business, office and industrial areas.
3. Provide development sites of such size and character so as to assure the development of the
Project area.
4. Eliminate or correct physical deterrents to the development of land.
5. Provide adequate streets, utilities and other public improvements and facilities to enhance the
area for development.
6. Achieve a high level of design and landscaping quality to enhance the physical environment.
7. Accomplish convenient and adequate parking to serve the needs of the area.
8. Create effective buffers, screens and/or transitions between residential and nonresidential uses
to minimize the potential blighting effects of divergent land uses.
9. Combine elements of the comprehensive city plan with these Project objectives.
10. Improve the financial base of the city.
11. Provide maximum opportunity, consistent with the needs of the city, for development by private
enterprise.
12. Provide increased employment opportunities and as much as possible seek businesses which
would employ the unemployed and underemployed.
13. Promote redevelopment in order to prevent or eliminate blight and maintain the viability of
commercial and residential areas.
DEVELOPMENT PROGRAM FOR DEVELOPMENT DISTRICT NO. 2
~ Minnesota Statutes, Section 469.175, Subd. 1(2) requires: "A statement as to the development
program for the project, including the property within the project, if any, which the authority intends to
acquire". The Development Program for Development District No. 2 is delineated in a report entitled
"Development District No. 2" adopted May, 1992 and modification August 1, 1994, copies of which are on file
in the city clerk's office. By this reference, said development program is incorporated as part of this tax
increment financing plan.
TAX INCREMENT DISTRICT DEVELOPMENT ACTIVITIES
Development activities to be financed in whole or in part as a result of the implementation of this Plan
include:
1. Reimbursement, to the city and developers, via a pay-as-you-go tax increment agreement for
property acquisition and site preparation costs.
2. Expansion and development by Metro Cabinets, Inc. and American Glass & Mirror, Inc. of an
approximate 10,000 sq. ft. production/warehouse facility.
All of the proposed activities and improvements are within the boundaries of Development District
No. 2 and District No. 2-3.
The developments will be started in 1994 and completed prior to December 31, 1994.
The above activities are, at the time of preparation of this report, the only activities proposed for the
Development District as a result of the formation of District No. 2-3. No contract has been entered into at the
time of preparation of this Plan pursuant to Minnesota Statutes, Section 469.175, Subd. 1(3), completion of
any of the activities.
CONFORMANCE WITH PLAN FOR THE CITY
The City Council, by approval of this report, believes that creation and implementation of District No.
2-3 does indeed meet the intent of the plan for the city by maintaining the quality of existing development,
and improving the quality of life through orderly planned improvements.
PROCEDURE FOR MAKING MODIFICATIONS IN AN APPROVED TAX INCREMENT DISTRICT PLAN
Tax Increment Financing District No. 2-3 may be modified, provided that the modification shall be
approved by the City Council under provisions of the Minnesota Tax Increment Financing Act of Minnesota
Statutes, Section 469.175, Subd. 4, as follows:
"(a) A tax increment financing plan may be modified by an authority, provided that any reduction or
enlargement of geographic area of the project or tax increment financing district, increase in amount of
bonded indebtedness to be incurred, including a determination to capitalize interest on the debt if that
determination was not a part of the original plan, or to increase or decrease the amount of interest on the
debt to be capitalized, increase in the portion of the captured assessed value to be retained by the authority,
increase in total estimated tax increment expenditures or designation of additional property to be acquired by
the authority shall be approved upon the notice and after the discussion, public hearing and findings
required for approval of the original plan; provided that if an authority changes the type of district from
housing, redevelopment or economic development to another type of district, this change shall not be
considered a modification, but shall require the authority to follow the procedure set forth in Sections 469.174
to 469.179 for adoption of a new plan, including certification of the assessed valuation of the district by the
county auditor. If a redevelopment.district or a renewal and renovation district is enlarged, the reasons and
supporting facts for the determination that the addition to the district meets the criteria of section 469.174,
subdivision 10, paragraph (a), clauses (1) and (2), or subdivision lOa must be documented. The require-
'rnents of this paragraph do not apply if (1) the only modification is elimination of parcels from the project or
district and (2)(A) the current tax capacity of the parcels eliminated from the district equals or exceeds the tax
capacity of those parcels in the district's original tax capacity or (B) the authority agrees that, notwithstanding
section 469.177, subdivision 1, the original tax capacity will be reduced by no more than the current tax
capacity of the parcels eliminated from the district. The authority must notify the county auditor of any
modification that reduces or enlarges the geographic area of a district or a project area.
(b) The geographic area of a tax increment financing district may be reduced, but shall not be
enlarged after five years following the date of certification of the original assessed value by the county auditor
or five years from August 1, 1979."
RELOCATION POLICY
The Tax Increment Financing Plan does not require any relocation at this time. The District does not
contain any residential, commercial, or industrial uses that will require relocation or movement on individual
sites. If in the future the District is expanded or modified to include additional area or relocation activities, the
City Council shall adopt rules and regulations that are in compliance with the Uniform Relocation Act and any
persons affected shall be treated according to those laws, rules and regulations.
PROPERTY ACQUISITION AND DISPOSITION
The City of Prior Lake will transfer property to the developers to enable their development of a
production/warehouse facility. The property proposed for disposition includes the property described under
the "Narrative Boundary Description of District No. 2-3" on page 2 of this Plan.
METHOD OF FINANCE
The City Council of the City of Prior Lake, Minnesota, elects to use Tax Increment Financing pursuant
to Minnesota Statutes, Chapter 469, to finance all or part of the costs of the Project.
By electing these methods of financing, the City Council is not precluding the use of other methods
provided by State law.
NOTIFICATION OF PRIOR PLANNED IMPROVEMENTS
Minnesota Statutes, Section 469.177, Subd. 4 requires that the request for certification of original tax
capacity be accompanied by a listing of properties within the tax increment district for which building permits
have been issued in the 18 months preceding approval of the tax increment financing plan. District No. 2-3
has had no building permits issued during this period, accordingly the most recent tax capacity will be 679.
FINANCIAL PLAN
ESTIMATE OF PUBLIC COST
The following is an estimate of public costs including cost of District indebtedness, source of
revenue, most recent tax capacity, and estimate of captured tax capacity.
1. Activities. Activities within the Project area consist of property acquisition and site improve-
ments. Costs which may be funded in Development District No. 2 as a result of the formation of
District No. 2-3 include:
A. Property acquisition
B. Site Improvements
SUBTOTAL ·
$ 75,000
34,000
$'~09,000
2. Public Cost Other Than Activities. The following is a listing of costs other than costs directly
attributed to undertaking of the Project area improvements:
A. Administration, planning and legal
SUBTOTAL
9,000
9,000
3. Financing Cost. Totaling activities costs and other costs as outlined in items 1 and 2 above,
results in the total financing cost.
A. Activities Costs $109,000
B. Other Costs 9,000
TOTAL FINANCING COST $118,000
4. Source of Funds.
A. Developer payment
B. Reimbursement of annual tax increment
TOTAL SOURCE OF FUNDS
$16,000
$102,000
$118,000
SOURCES OF REVENUE
The proposed sources of revenue to be used to finance public costs associated with the develop-
ment projects in the District are developer payments and tax increment generated as a result of the taxation
of the land and improvements in the District. Tax increment financing refers to a funding technique that
utilizes increases in tax capacity and the property taxes attributed to new development to finance, or assist in
the financing of public development costs. The improvements resulting from development of the property by
private business within the District is anticipated to generate an initial annual tax increment of $16,000 in
1996 through the year 2004.
The District's tax increment will be generated from the construction of an approximate 10,000 sq ff.
production/warehouse facility. The city may issue tax increment bonds or use the annual receipt of tax
increment to reimburse eligible Project costs.
FINANCING ASSUMPTIONS
Tax increment will be used to finance activities in the Project area. The following information and
assumptions were used to calculate financing costs for the activities in the Project area.
1. Table 1 on page 8 shows the calculations which were used to determine the amount of property
taxes and tax increment resulting from the proposed development in District No. 2-3.
2. Development activities are scheduled to begin in August, 1994, and shall be completed by
December 31, 1994.
3. Financing of the Project activities will be undertaken in 1994.
4. The first tax increment in the estimated amount of $16,000 collected from the District will be in
1996 payable from the 1995 tax levy.
5. The 1994 local tax rate of 155.513% and 1994 tax values were used to calculate the estimate of
increment in this plan.
6. Annual tax increments of $16,000 in 1996 through 2004 generated as a result of formation of
this District will be one source of funds used to finance the Project area activities. A portion of
developer financed costs for property acquisition and administration will be repaid with increment
revenues in excess of $14,400 (amount required for reimbursement of public costs). The amount of
revenues available for reimbursement to the developer shall be net of any LGA/HACA reduction and
shall not exceed a cumulative amount of $14,500.
7. Increment revenues will be used to finance only capital and administrative costs resulting from
the Project activities. All tax increment generated by the formation of this District will be used to
finance the activities of the Plan.
TABLE 1' TAX INCREMENT CALCULATIONS
Local Tax Rate =155.513% (Prior Lake, Payable 1994)
ESTIMATED COMPLETION MARKET VALUE: $183,325 CLASSIFICATION: INDUSTRIAL
(assume completion prior to 12-31-94)
(1) (2) (3)
Year Base Estimated
Tax Tax Tax
Payable Cal3acity Cal:)acity
(4) (5) (6)
Captured Estimated Estimated
Tax Annual LGA
Capacity Increment Im~)act
(7)
Estimated
Net Annual
Increment
1994 679
1995 693
1996 706
1997 721
1998 735
1999 750
2000 765
2001 780
2002 796
2003 811
2004 828
2005 0
TOTAL
679
693
10 969
10,969
10 969
10 969
10 969
10.969
10 969
10 969
10.969
Dece~ified
0
0
1 O, 263
10,248
10,234
10,219
10,204
10,189
10,173
10,158
10,141
0
0
1596O
15 938
15,915
15~892
15,869
15 845
15 821
15 796
15.771
0
$142,808
0
0
4,482
4,476
4,47O
4,464
4,457
4,450
4,444
4,437
4,429
0
$40,109
0
0
11 477
11 461
11445
11 429
11 412
11 395
11 378
11360
11 342
o
$102,698
PRESENT VALUE DISCOUNTED AT 4%
$109,122 $30,648 $78,474
8. The city will use tax increments of approximately $16,000 in 1996 through 2004 plus any
additional increment revenues as a result of future expansions to service Project costs. "Project
Costs" means all expenditures of the city or reimbursement for the purchase of land or amounts paid
to contractors or others providing materials and services, including architectural and engineering
services, directly connected with the physical development of the real property in the District,
including interest thereon. Project costs also include all administrative expenses as defined in
Minnesota Statutes, Section 469.174, Subdivision 14. In order to estimate the amount of the
increment assistance the City and developer will receive as a result of the approval of District No. 2-3
two additional factors were considered: (1) the impact the District would have on future Local
Government Aid (LGA) received by the city, and (2) the estimated present value of the net tax
increment. Both factors are shown in Table 1. The estimated LGA impact is shown in column 6 of
Table I and the present value of the increment is shown in column 7 of Table 1. In forming District
No. 2-3 the city will potentially experience future reductions in LGA as per column 6. While the city is
prohibited from using tax increment to replace LGA losses, by retaining a portion of the increment for
its overall economic development efforts the city may be able to generate future tax base growth thus
mitigating the impact of reduced LGA. The first increment would be available to the city in 1996 and
would continue through 2004.
UMITATION ON USE OF TAX INCREMENT; GENERAL RULE
Pursuant to Minnesota Statutes, Section 469.176, Subd. 4, "All revenues derived from tax increment
shall be used in accordance with the tax increment financing plan. The revenues shall be used solely for the
following purposes: (1) to pay the principal and interest on bonds issued to finance a project; (2) by a rural.
development financing authority for the purposes stated in Minnesota Statutes, Section 469.142, by a port
authority or municipality exercising the powers of a port authority to finance or otherwise pay the cost of
redevelopment pursuant to Minnesota Statutes, Sections 469.048 to 469.068, by an economic development
authority to finance or otherwise pay the cost of redevelopment pursuant to Minnesota Statutes, Sections
469.090 to 469.108, by a housing and redevelopment authority or economic development authority to finance
or ~)therwise pay public redevelopment costs pursuant to Minnesota Statutes, Sections 469.001 to 469.047,
by a municipality or economic development authority to finance or otherwise pay the capital and administra-
tion costs of a development district pursuant to Minnesota Statutes, Sections 469.124 to 469.134, by a
municipality or authority to finance or otherwise pay the costs of developing and implementing a develop-
ment action response plan, by a municipality or redevelopment agency to finance or otherwise pay premiums
for insurance or other security guaranteeing the payment when due of principal of and interest on the bonds
pursuant to Minnesota Statutes, Sections 462C, Sections 469.152 to 469.165, or both, or to accumulate and
maintain a reserve securing the payment when due of the principal of and interest on the bonds pursuant to
Chapters 462C, Sections 469.152 to 469.165, or both, which revenues in the reserve shall not exceed,
subsequent to the fifth anniversary of the date of issue of the first bond issue secured by the reserve, an
amount equal to 20 percent of the aggregate principal amount of the outstanding and nondefeased bonds
secured by the reserve.
EXCESS TAX INCREMENTS
Pursuant to Minnesota Statutes, Section 469.176, Subd. 2, "(a) In any year in which the tax increment
exceeds the amount necessary to pay the costs authorized by the tax increment financing plan, including the
amount necessary to cancel any tax levy as provided in Section 475.61, Subd. 3, the authority shall use the
excess amount to do any of the following: (1) prepay any outstanding bonds, (2) discharge the pledge of tax
increment therefore, (3) pay into an escrow account dedicated to the payment of such bonds, or (4) return
the excess amount to the county auditor who shall distribute the excess amount to the municipality, county
and school district in which the tax increment financing district is located in direct proportion to their
respective tax capacity tax extension rates. The county auditor must report to the commissioner of education
the amount of any excess tax increment distributed to a school district within 30 days of the distribution.
(b) The amounts distributed to a city or county must be deducted from the levy limits of the govern-
mental unit for the following year. In calculating the levy limit base for later years, the amount deducted must
be treated as a local government aid payment.
DURATION OF TAX INCREMENT FINANCING DISTRICTS
The city estimates that the District shall endure for as long as it is permitted to by law. If no new
development activities were to occur, the city estimates that tax increments would be sufficient to pay all
indebtedness initially undertaken and to pay all initial and administration costs of the District by 2004.
LIMITATION OF ADMINISTRATIVE EXPENSES
Pursuant to Minnesota Statutes, Section 469.176, Subd. 3, "(a) .... no tax increment shall be used to
pay any administrative expenses for a project which exceed ten percent of the total tax increment expendi-
tures authorized by the tax increment financing plan or the total tax increment expenditures for the project,
whichever is less.'
ESTIMATED TOTAL CAPTURED TAX caPaCITY; RETENTION
The city estimates that the District's total tax capacity at completion of the initial activities will be
10,969; Since the original tax capacity is 679 with a 2% annual inflation factor the captured tax capacity will
be 10,263 in 1996. Pursuant to Minnesota Statutes, Section 469.177, Subd. 2, the authority may retain the
full captured tax capacity to pay expenditures noted in the Plan or subsequent Plan modifications.
TAX INCREMENT ACCOUNT
Pursuant to Minnesota Statutes, Section 469.177, Subd. 5, "the tax increment received with respect to
any diStrict shall be segregated by the authority in a special account or accounts on its official books and
'~(ecords or as otherwise established by resolution of the authority to be held by a trustee for the benefit of
holders of the bonds.'
ANNUAL DISCLOSURE AND FINANCIAL REPORTING
~ Minnesota Statutes, Section 469.175, Subd. 5, requires "For all tax increment financing districts,
whether created prior or subsequent to August 1, 1979, on or before July I of each year, the authority shall
submit to the county board, the school board, the commissioner of revenue and, if the authority is other than
the municipality, the governing body of the municipality a report of the status of the district. The report shall
include the following information: the amount and the source of revenue in the account, the amount and
purpose of expenditures from the account, the amount of any pledge of revenues, including principal and
interest on any outstanding bonded indebtedness, the original tax capacity of the district, the captured tax
capacity retained by the authority, the captured tax capacity shared with other taxing districts, the tax
increment received, and any additional information necessary to demonstrate compliance with any applicable
tax increment financing plan. An annual statement showing the tax increment received and expended in that
year, the original tax capacity, captured tax capacity, amount of outstanding bonded indebtedness, and any
additional information the authority deems necessary shall be published in a newspaper of general circulation
in the municipality."
Minnesota Statutes, Section 469.175, Subd. 6, requires "(a) The state auditor shall develop a uniform
system of accounting and financial reporting for tax increment financing districts, the system of accounting
and financial reporting shall, as nearly as possible:
(1) provide for full disclosure of the sources and uses of public funds in the district;
(2) permit comparison and reconciliation with the affected local government's accounts and
financial reports;
(3) permit auditing of the funds expended on behalf of a district, including a single district that is
part of a multidistrict project or that is funded in part of whole through the use of a development account
funded with tax increments from other districts or with other public money; (4) be consistent with generally accepted accounting principles.
(b) The authority must annually submit to the state auditor, on or before July 1, a financial report in
compliance with paragraph (a). Copies of the report must also be provided to the county and school district
boards and to the governing body of the municipality, if the authority is not the municipality. To the extent
necessary to permit compliance with the requirement of financial reporting, the county and any other ap-
propriate local government unit or private entity must provide the necessary records or information to the
authority or the state auditor as provided by the system of accounting and financial reporting developed
pursuant to paragraph (a).
(c) The annual financial report must also include the following items:
(1) the original tax capacity of the district;
(2) the captured tax capacity of the district, including the amount of any captured tax capacity
shared with other taxing districts;
(3) the outstanding principal amount of bonds issued or other loans incurred to finance project
costs in the district;
(4) for the reporting period and for the duration of the district, the amount budgeted under the tax
increment financing plan, and the actual amount expended for, at least, the following categories:
(i) acquisition of land and buildings through condemnation or purchase;
(ii)site improvements or preparation costs;
(iv)administrative costs, including the allocated cost of the authority;
(5) for properties sold to developers, the total cost of the property to the authority and the price
paid by the developer;
(6) the amount of tax exempt obligations, other than those reported under clause (3), that were
issued on behalf of private entities for facilities located in the district.
(d) The reporting requirements imposed by this subdivision are in lieu of the annual disclosure
required by subdivision 5.'
IMPACT OF THE USE OF TAX INCREMENT OF TAXING JURISDICTIONS
Minnesota Statutes, Section 469.175, Subd. 1 (6), requires 'statements of the authority's alternate
10
estimates of the impact of tax increment financing on the tax capacity of all taxing jurisdictions in which the '
tax increment financing district is located in whole or in part. For purposes of one statement, the authority
shall assume that the estimated captured tax capacity would be available to the taxing jurisdictions without
creation of the district, and for purposes of the second statement, the authority, shall assume that none of the
estimated captured tax capacity would be available to the taxing jurisdictions without creation of the district;"
Table 2 on page 12 depicts the impact of tax increment financing on the tax capacity of the affected
taxing jurisdictions assuming (1) none of the increment would be available, and (2) the increment would be
available to the tax jurisdictions.
11
¢12~
-NOTICES, RESOLUTIONS, TRANSMITTALS AND CERTIFICATIONS
1. RESOLUTION CALLING FOR A PUBLIC HEARING
2,; NOTICE OF A PUBMC HEARING
- INCLUDING LOCATION MAP
3. AFFIDAVIT OF PUBLICATION
4. TRANSMITTAL TO INDEPENDENT SCHOOL DISTRICT NO. 719
5. TRANSMITTAL TO SCOTT COUNTY BOARD OF COMMISSIONERS
6. RESOLUTION OF THE CITY COUNCIL APPROVING AND ADOPTING TAX INCREMENT FINANCING
DISTRICT NO. 2-3
7. CERTIFICATION OF ORIGINAL TAX CAPACITY AND ORIGINAL LOCAL TAX RATE FOR TAX INCRE-
MENT FINANCING DISTRICT NO. 2-3
RESOLUTION ON THE PROPOSAL TO MODIFY DEVELOPMENT DISTRICT NO.2 AND FORM TAX
INCREMENT FINANCING DISTRICTS NOS. 2-3 AND 2-4 WITHIN DEVELOPMENT DISTRICT NO. 2, ADOPT A
DEVELOPMENT PROGRAM AND TAX INCREMENT FINANCING PLANS AND CALL FOR
CONSULTATION WITH OTHER AFFECTED JURISDICTIONS AND PUBLIC HEARING
' WHEREAS, a proposal to modify Development District No. 2, form Tax Increment Financing Districts
Nos. 2-3 and 2-4 within Development District No. 2 under the provisions of Minnesota Statutes, Chapter 469
(the "Act"), and to adopt a development program and tax increment financing plans has been received by the
City Council; and
WHEREAS, the Act requires that prior to modification of a development district and formation of a tax
increment financing district the City Council shall provide a reasonable opportunity to members of the County
Board of Commissioners of the County of Scott and the members of the School Board of Independent
School District No. 719 to meet with the City Council and that the City Council shall fully inform the members
of the County Board and School Board of the fiscal and economic implications of the proposed tax
increment financing districts; and
WHEREAS, the Act further requires that prior to the modification of a development district, formation of
a tax increment financing district and the adoption of a development program and tax increment financing
plan a public hearing shall be held thereon.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Prior Lake, Minnesota, as follows:
1. The City Clerk is authorized and directed to make available to the County Board of Commissioners
of Scott County and of the School Board of Independent School District No. 719 a copy of this
resolution, together with a copy of the proposed development program and tax increment financing
plans, and to invite board members to meet with the City Council to discuss said proposals on the 1st
day of August, 1994, at 7:45 p.m. at the City Hall.
2. A public hearing on said plan will be held at the time and place set forth in the Notice of Hearing
hereto attached and incorporated herein by reference. The City Clerk is authorized and directed to
cause said Notice of Hearing to be published in the official newspaper and, if the official newspaper
does not have general circulation, in a newspaper of general circulation in the City at least once not
less than 10 days nor more than 30 days prior to the date of hearing and to cause a copy of said notice
to be mailed to Scott County and the School Board of Independent School District No. 719.
Adopted this 5th day of July, 1994.
ATTEST:
Lydia Andren
Mayor
Frank Boyles
City Manager
NOTICE OF PUBLIC HEARING ON
DEVELOPMENT DISTRICT MODIFICATION AND
FORMATION OF TAX INCREMENT FINANCING DISTRICTS
TO WHOM' IT MAY CONCERN:
Notice is hereby given that the City Council of the City of Prior Lake, Minnesota, will meet at the City
Hall in Prior Lake, Minnesota, at 7:45 p.m. on Monday, August 1, 1994, to consider the modification of
Development District No. 2 and the formation of Tax Increment Financing Districts Nos. 2-3 and 2-4, and the
adoption of a development program and tax increment financing plans pursuant to Minnesota Statutes,
Chapter 469. Such persons as desire to be heard with reference to the above proposals will be heard at this
meeting.
Tax Increment Financing District No. 2-3 is located on a portion of Lot 2, Block I (preliminary plat) in
the Waterfront Passage Business Park, south of County Road 21 on the east side of Prior Lake. Tax
Increment Financing District No. 2-4 is located on Block 1, Lot 3 and Outlot A, Langhorst First Addition; Block
1, Lot 1, Cates Addition; the southerly one-half of Lot 2, Block 14, Original Plat; and, Section 10, Township
114, Range 22, 3.62 acres in Government Lot 5 lying north and west of Highway 13. The modified boundary
of Development District No. 2 is coterminous with the boundary of Waterfront Passage Business Park and the
proposed Tax Increment District No. 2-4 boundary. The map accompanying this notice shows the location of
the proposed Districts.
Copies of the proposed Development Program and Tax Increment Plans are on file in the office of the
City Clerk and are available for public examination. Written or oral statements will be considered.
Dated: This 5th day of July, 1994.
BY ORDER OF THE PRIOR LAKE CITY COUNCIL
By.
Frank Boyles
City Manager
FAX 612 447 4245 CiTY PRIOR L~.KE [~002
07/01,'94
11:23
June 29,1994
Prior Lake Independent School District 719
P.O. Box 539
Prior Lake, MN. 55372
Attention: Dr. Les Sonnabend
Dear School Board Members and Dr. Sonnsbend:
On behalf of the City of Prior Lake I mn submitting information pertaining to the City's proposed
Tax Increment Financing Distr/cts for Economic Development and Redevelopment. 'The
information responds to the points contained on the Scott County TIF Review Team Worksheet.
Over the past several months City staff has been working with numerous development proposals,
however there are only three projects which merit consideration for using tax increment
financing to enhance or exper the projects and to assist with public ~n6-astructure costs. In
summary the City of Prior Lake proposes to create two tax increment financing districts for the
following projects:
A: A redevelopment district which would include vacant l~ts at Walker and Pleasant
Street and three blighted buildings on M~n Avenue adjacent to the site combined
with the triangular parcel located at l?0th and Highway 13 South. Proceeds from
the tax increments would be used to promote redevelopment of the blighted
properties on Main Avenue and Pleasant SWeet, relocation of a non conformin'g
use on the "trian~e" property, and the improvement and reali~ment of the
intersection of 170th and Highway 13 South. Increments captured from proposed
new retail on the vacant lots at Walker and Pleasant Street and from new
construction on the "trian~e" property will provide necessm'y funds in order to
make this redevelopment possible.
B. An economic development district in the Waterfront Passage Addition for
construction of a 10,000 square foot multi-tenant bui]d~ng on a one acre lot. The
developers are local businessmen who propose to occupy the building once it is
completed.
The attached information provides more information regarding these projects.
You are invited to a public hearing of the Prior Lake City Council on Monday, August 1, 1994 at
7:45 P.M. in the City Council Chambers of the Prior Lake City Hall. The purpose of the meeting
is to discuss the establishment of Tax Increment Financing Districts numbers 2-3 and 2-4 which.
if created will enable the City to provide tax increment financing assistance to the above
described projects.
Minnesota 55372-1714 /_ Fh. (612) 447-4230 / Fe.x (612) 447-4245
cITy PRIOR L.~.KE [~003
07/01/9-1
11:2~
FAX 612 ~7
Since the proposed plans involve the taxable base of .your jurisdiction, representation at the
meeting would be appreciated. Attached to this letter is a copy of the Notice of the Public
Hearing, a more complete description of the projects, location maps and an estimate of the fiscal
and economic ~rnpacts associated with these developments.
If you have any questions regarding the above inform~ion, please contact me at 447-4230.
Sincerely,
Bonita Carlson
Assistant City Manager
OT,'O1/9~
P
08'48
FAX 612 447 4245
CITY PRIOR LAKE [~001
FAX_TRANSMITTAL # of Pages ~
FAX~ ,5~? 8o~/~ FAXA~ (61~)447-424S
,Tune 29,1994
The Scott County Board of Commissioners
Scott Cotmty Courthouse
428 South Holmes Street
Shakopee, Nh-'q. 55379
Attention: Cliff McCama, County Admin/strator
Dear County Commissionem and Mr. McCann:
On behalf of the City of Prior Lake I am submitting information pertaining tO the City's proposed
Tax Increment Financing Districts for Economic Development and Redevelopment:.. The
information responds to the points contained on the Scott County TIF Review Te~m Worksheet.
Over the past several montes City staff has been workLng with numerous development proposals,
however there Ne only three projects which merit consideration for using tax increment
finn.ricing to enhance or expand the projects and to assist with public infrastructure costs. In
summary the City of Prior Lake proposes to create two tax increment financing districts for the
following projects:
A:
A redevelopment district which would incIude vacant lots at Walker and Pleasant
Street and three blighted buildings on Main Avenue adjacent to the site combined
with the triangular parcel located at .170th and Highway 13 South. Proceeds from
the tax increments would be used to promote-redevelopment of' the .blighted
properties on Main Avenue and Pleasant Street,. relocation of'a. non conforming
use on the "triangle" property, and the improvement and realignment of the
intersection of 170th and Highway 13 South. Increments captured from proposed
new retail on the vacant lots at Walker and Pleasant Street and from new
construction on the "trian~e" property will provide necessary ~unds in order to
make redevelopment possible.
An economic development district in the Waterfront Passage Addition for
construction of a I0,000 square foot multi-tenant building on a one acre lot. The
developers are local businessmen who propose to occupy the building once it is
eornpleted.
The attached information provides more information regarding these projects.
You are invited to a public hearing of the Prior Lake City Council on l~onday, August 1, 1994 at
7:45 P.M. in the City Council Chambers of the Prior Lake City Hall. The purpose of the meeting
is to discuss 'the establishment of Tax Increment F'mancing Districts numbers 2-3 and 2-4 which,
if created will enable the City to provide tax increment financing assistance to the above
described projects.
07/01/94 08:48 FAX 612 447 4245 CI'I'~ F}~I~I~ L_{lx~-
Since the proposed plans involve the t~x~le b~s¢ of yom' jurisdiction, representation ~ the
meeting would b~ appreciated. AttachecI to this letter is a ¢op¥ of the Notice of the Public
I-Ie~g, a more complete description of the projects, location maps Md
and economic ~np~c~ ~ssoci~ecl with these developments.
If you have any questions regarding the above information, please contact me at 447-4230.
Sincerely,
Bonita Carlson
Assistant City Manager
MOTION BY:
RESOLUTION 95-
,!
SECONDED BY:
A RESOLUTION OF THE CITY COUNCIL OF THE CiTY OF PRIOR LAKE
APPROVING TAX INCREMENT FINANCING DISTRICT NO. 2-3
AND THE USE OF TAX INCREMENT FINANCING
WHEREAS, the City Council of the City of Prior Lake, Minnesota (the "City"), has previously approved
Development District No. 2 (the "Development District") and in connection therewith adopted a development
program; and
WHEREAS, it is desirable and in the public interest that the City undertake and carry out a tax increment
finance plan for Tax Increment Financing District No. 2-3 pursuant to Chapter 469 of Minnesota Statutes,
encompassing the area which is more particularly described on Exhibit A attached hereto and made a part
hereof, (which area is herein called the "District"); and
WHEREAS, the City Council has reviewed "Tax Increment Financing District No. 2-3, dated
August 1, 1994" (the "Plan Booklet"), which sets forth a tax increment financing plan for the District; and
WHEREAS, the Plan Booklet sets forth the City's estimate of the fiscal and economic impact of the
District on the tax capacities of all taxing jurisdictions in which the District is located; and
WHEREAS, the Board of Commissioners of Sco~t County, Minnesota, has been notified of the public
hearing for the review of the Plan Booklet; and
WHEREAS, the School Board of Independent School District No. 719 has been notified of the public
hearing for the review of the Plan Booklet; and
WHEREAS, the City has received and considered the comments of the Board of Commissioners of Scott
County and the School Board of the Independent School District No. 719 respecting the contents of the Plan
Booklet; and
WHEREAS, the City on August 1, 1994, after having published a notice of public hearing in the official
newspaper of the City, conducted a public hearing on the Plan Booklet and received public comments on
the same.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Prior Lake, Minnesota, as
follows:
1. The City finds and determines that there is a need for the activities of Development District No.
2 to be financed in part by the tax increments from the District.
2. The City finds and determines that the activities to be financed by the tax increments from the
District will carry out the objectives of Development District No. 2 by encouraging industrial develop-
ment, providing job opportunities and enhancing the tax base.
3. The City finds and determines that the provision for job opportunities and the preservation and
enhancement of the tax base are in the public interest of the City and the expenditures of the District are
a public purpose.
4. The City finds and determines that the tax increment financing plan as set forth in the Plan
Booklet having been duly reviewed and considered is hereby approved and adopted, and the area
described in Exhibit A hereto is hereby designated as an Economic Development District pursuant to
Minnesota Statutes, Sections 469.174, Subd. 12.
5. The City finds and determines that the District is an Economic Development District because it
will result in increased employment in the City, and that it will result in preservation and enhancement of
the tax base of the City.
6. The City finds and determines that the proposed development, in the opinion of the City,
would not reasonably be expected to occur solely through private investment within the reasonably
foreseeable future and therefore the use of tax increment financing is deemed necessary.
7. The City finds and determines 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 District
by private enterprise.
8. The City finds and determines that the tax increment financing plan set forth in the Plan
Booklet conforms to the general plan for the development of the City as a whole.
9. The reasons and supporting facts for findings 5, 6, 7 and 8 as set forth on pages 2, 3 and 4 of
the Plan Booklet are by this reference confirmed, approved and adopted.
10. The City elects to retain tax increment revenues generated in District No. 2-3 pursuant to
clause (a) of Minnesota Statutes, Section 469.177 Subdivision 3, Paragraphs I and 2. By making this
election tax increment revenues generated within District No. 2-3 will not be made available for
calculation or sharing with the fiscal disparity provisions of Chapter 473F.
11. The City Clerk shall request the auditor of Scott County to certify the original tax capacity and
original local tax rate of the District approved by this resolution.
12. The City Clerk is hereby directed to file a copy of this resolution with a copy of the Plan
Booklet to the Minnesota Department of Revenue.
13. The City hereby states its intention to use all of the captured tax capacity for purposes of tax
increment financing as per the conditions set forth in the Plan Booklet.
Passed and adopted this 17th day of January, 1995.
Andren
Greenfield
Kedrowski
Scott
Schenck
YES NO
Andren
Greenfield
Kedrowski
Scott
Schenck
Frank Boyles
City Manager
City of Prior Lake
(Seal)
EXHIBIT a
TO
CITY COUNCIL RESOLUTION APPROVING
TAX INCREMENT FINANCING DISTRICT NO. 2-3
Tax Increment Financing District No. 2-3 includes the following property:
That part of the Southwest Quarter of Section 1, Township 114, Range 22, Scott County, Minnesota
described as follows:
Upon platting of the property by the City it is anticipated that the legal description for the parcel will be
identified as Lot 2, Block 1, WaterFront Passage Business Park.
List of All Taxable Parcels
Within the District
ATTACHMENT "A"
TO THE
CERTIFICATE AS TO ORIGINAL NET TAX CAPACITY
AND ORIGINAL LOCAL TAX RATE WITHIN
TAX INCREMENT FINANCING DISTRICT NO. 2-3
IN THE CITY OF PRIOR LAKE, MINNESOTA
Original Net Tax Capacity
as Certified by State
25-300-004-0* 679
Total Net Tax Capacity
679
* Lot 2, Block 1 of WaterFront Passage Business Park is currently recorded as a portion of Parcel #25-296-
001-0; upon recording of a final plat for Lot 2, Block 1, Parcel #25-300-004-0 will be assigned.
.STATE OF MINNESOTA
COUNTY OF SCOTT
) CERTIFICATION AS TO ORIGINAL NET TAX CAPACITY AND
) ORIGINAL LOCAL TAX RATE WITHIN TAX INCREMENT FINANCING
) DISTRICT NO. 2-3 IN THE CITY OF PRIOR LAKE, MINNESOTA
I, the undersigned, being the duly qualified and acting County Auditor of Scott County, Minnesota, do
hereby certify to the City of Prior Lake in said County, pursuant to the provisions of Minnesota Statutes,
Section 469.177, Subd. 1, that the original net tax capacity of all taxable property within the tax increment
district designated as Tax Increment Financing District No. 2-3 (the "District") of said City, as described in the
tax increment financing plan for the area approved by City Council resolution dated January 17, 1995, is 679.
I also certify that such original net tax capacity is composed of the net tax capacity of each parcel of
taxable property within the District as determined by the assessment thereof in 1994, this being the net tax
capacity most recently determined before the date when this certification was requested.
I will also, in accordance with the provisions of Minnesota Statutes, Section 469.177, Subd. 1, add to
the original net tax capacity of the District, an amount equal to the original net tax capacity for the preceding
year multiplied by the average percentage increases in the market value of all property included in the
District during the five years prior to certification of the District.
The market value of all property in the District for the five years prior to certification of the District is as
follows:
Assessment Year
Tax Year Market Value Percent Chanqe
January 2, 1989 1990 $1,300 0%
January 2, 1990 1991 1,300 0%
January 2, 1991 1992 1,300 0%
January 2, 1992 1993 1,300 0%
January 2, 1993 1994 1,430 10%
The average percentage increase in the tax capacity of all property in the District during the five years
prior to its certification is 2%.
I also certify that attached to and made part of this certificate is a full, true, and complete list of all
taxable parcels of real property within the District and of the original net tax capacity determined for each
parcel and included in the aggregate amount stated above.
I also recognize, and in doing so make public record thereof, that the City of Prior Lake wishes to waive
the right to collect the increment for the tax years payable in 1994 and 1995 and in doing so elects to collect
the increment for the years 1996 through 2004, inclusive.
I also certify pursuant to the provision of Minnesota Statutes, Section 469.177, Subd. la that the "local
tax rate" that applies to the District is 155.513%
WITNESS my hand and seal this . day of
,1995.
Scott County Auditor