HomeMy WebLinkAbout7C Prior Lake Revival Tax Abatement PresentationPrior Lake City Council
June 12, 2017
Project Description
Prior Lake Revival will be
constructing a new
commercial building.
Located at the SW
corner of the
CH21/Duluth Ave
intersection.
12,412 SF
3 to 4 tenant spaces
including Olson Dental
and Crossroads
Optometric.
Tax Abatement
PL Revival is requesting Pay-
as-you-go tax abatement.
Max amount of $125,000
Max term of 15 years
To assist with site
development costs
associated with:
Soil corrections
Soil export/import, and
Retaining wall construction
Tax Abatement
If approved, the tax abatement will be based on certified site
development costs in an amount not to exceed $125,000; and
Will be based upon the net amount of property taxes received
by the City from the project site.
The “net amount of property taxes” is the actual annual amount
of property taxes received by the City attributable to an increase
in the property taxes as a result of the project.
The Council has considerable flexibility in setting the terms of
the abatement; for example, the abatement may be set as a
percentage of tax payable, a dollar amount, tax attributable to
a portion of the parcel’s market value, or something else.
Business Subsidy Policy
In accordance with MN Business Subsidy Law, the City
adopted a Business Subsidy Policy, most recently updated
on August 26, 2013.
The policy establishes guidelines and other criteria
regarding the use of business subsidies for private
development projects within the City of Prior Lake.
The Local Business Incentives Policy requires anyone
receiving a business incentive between $5,001 and
$149,999 to enter into an agreement with the City.
Business Subsidy Agreement
Use of Business Subsidy. Used for reimbursement of site development
costs associated with soil corrections, soil export/import and retaining wall
construction on the project site.
Approved Costs. By June 30, 2018, Revival shall submit to the City evidence
affirming they have incurred and paid Site Development Costs. Approved
Costs to be certified by City, not to exceed $125,000.
Business Subsidy Payments.Payments would begin in the year 2019. The
City shall cease making Business Subsidy payments on the sooner of:
(i) when the City has made Business Subsidy payments to Revival in the
amount of the Approved Costs;
(ii) upon Revival’s breach of the BSA; or
(iii) with respect to the property taxes payable in 2033.
Wage and Job Goals of the Project. The creation and retention of jobs is
expected but not a goal of this Business Subsidy, therefore the wage and job
goals are set to zero.
Public Purpose Objectives
The proposed development would achieve several Public Purpose
Objectives identified in the Business Subsidy Policy, including:
To enhance and diversify the City’s tax base;
To provide employment opportunities in the City;
To help provide access to services for residents of the City;
To achieve development on a site that may not be developed
without business subsidies assistance;
To encourage development of a commercial area in the City
that results in higher quality development and private
investment; and
To offset increased costs of development of a specific property
when the unique physical characteristics of the site may
otherwise preclude private investment.
Questions