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00-731Council File # C� + 7 3, 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 ORIGINAL Presented By Referred To R05olUtiOn # Green Sheet # �D,�n�� BE IT RESOLVED by the City Council of the City of Saint Paul, Minnesota (the "City") as follows: Section 1. Recitals. 1.01 On June 23, 1999, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "Authority") established the North Quadrant Redevelopment Project Area (the "Redevelopment Project Area") and adopted a redevelopment plan therefor (the "Redevelopment Plan��). 1.02 The Authority has asked the City Council to approve the creation, within the Redevelopment Project Area, of Tax Increment Financing District No. 1(North Quadrant) (the "Tax Increment District") and the adoption oE a Tax Increment Financing Plan therefor, all pursuant to and in accordance with Minnesota Statutes, Section 469.174 through 469.179 (the "Tax Increment Act") and Laws of Minnesota 2000, Chapter 490, Article 11, 5ection 40 (the "Special Law"). 1.03 The Authority has performed all actions required by law to be performed prior to the creation of the Tax Increment District and adoption of a Tax Increment Plan therefor, including, but not la.mited to, notificaCion of Ramsey County and Independent School District Number 625, which have taxing jurisdiction over the property to be included in the Tax Increment District, and has requested that the City approve the adoption of the Tax Increment Financing Plan and the creation of the Tax Increment District £ollowing the holding of a public hearing upon published and mailed notice as required by law. 2.01 The City Cpuncil hereby finds that the creation of Tax Increment FinanCing District No. 1(NOrth Quadrant) and adoption of a Tax Increment Plan therefor, are intended and, in the judgment oE the City Counci.l, its effect will be, to carry ouC the objectives of the Redevelopment Plan and to create an impetus for the construction in the City of affordable and mixed income housing, will increase employment and otherwise promote certain public gurposes and accomplish certain objecCives as specified in the Redevelopment Plan and Tax Increment Financing Plan. 1142957.1 ' RESOLUTION APPROVING THE THE CREATION OF TAX INCREMENT FINANCING DISTRICT NO. 1(NORTH QUADRANI'), AND THE ADOPTION OF A TAX INCREMENT FTNANCING PLAN THEREFOR p _�131 1 2 3 4 5 6 7 8 9 10 il 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 2.02 The City Council hereby finds that Tax Increment Financing District No. 1(North Quadrant) qualifies as an "housing district" within the meaning of the Tax Increment Act and the Special Law Por the following reasons: The property to be included in the Tax Increment District is located in the Northeast quadrant of the City, i_e. within the 15 acre site bounded by Interstate 94 on the north and east, Jackson Street on the west and Seventh Street on the south, together with the west side o£ Jackson Street to midblock between Interstate 94 and South Street. 'I}aenty percent of the housing units the Tax Increment District will be occupied by individuals whose family income is equal to or less than 50 percent of area median gross income and an additional 60 percent of the units will be occupied by individuals whose family income is equal to or less than 115 percent of area median gross income. Twenty percent of the units in the Tax Increment District will not be subject to any income limitations. Family income means the median gross income for the City as determined under section 42 of the Internal Revenue Code of 1986, as amended. The income requirements will be satisfied if the sum of qualified owner-occupied units and qualified residential rental units equals the required total number of qualified units. Owner-occupied units will initially be purchased and occupied by individuals whose family inoome satisfies the income requirements. For residential rental property, the income requirements apply for the duration of the Tax InCrement District. The fair market value of the improvements which are constructed in the T� Increment District for commercial uses or for uses other than owner- occupied and rental mixed-income housing will not consist of more than 20 percent of the total fair market value of the planned improvements in the development plan or agreement. The fair market value of the improvements wi11 be determined using the cost of construction, capitalized income, or other appropriate method of estimating market value. 2.03 The City Council hereby makes the following findings: 1192957.1 a � _ 731 1 2 4 5 6 7 8 9 10 il 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 (a) The City Council further finds that the proposed development, in the opinion of the City Council, would not occur solely through private investment within the reasonably foreseeahle future and, Cherefore, the use of tax increment financing is deemed necessazy_ The specific basis for such finding being: The parcels on which the development will occur would not be developed in the reasonably foreseeable future because they are currently used for surface parking, which use generates significant income to the current owner of the property considering the owner�s minimal investment in the property. (b) The City 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 is in accordance with the existing zoning for the property. (c) The City Council further finds that the Tax Tncrement Financing Plan will afford maximum opportunity consistent with the sound needs of the City as a whole for the development of the Tax Increment District by private enterprise. The specific basis for such finding being: The proposed development to occur within the Tax Increment District is housing. The development will increase needed affordable and mixed income housing in the City and will increase the market valuation of the City. (fl) 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 market value estimated to result from the proposed development (i.e., $15,065,744) after Subtracting the present value of the projected tax increments for the maximum duration of the Tax Increment District (i.e., $3,481,295). In making these findings, the City Council has noted that the property has been undeveloped for many years 1192957.1 ORIG4NAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 a � ..'13� 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. 2.04 The provisions of this Section 2 are hereby incor- porated by reference into and made a gart of the Tax Increment Financing Plan. Section 3. Creation of Tax Increment Financing District No. 1(North Ouadrant) and the Tax Increment Financina Plan therefor. 3.01 The creation of Tax Increment Financing District No. 1 (North Quadrant) is hereby approved and the Tax Increment Financing Plan therefor is hereby adopted. 3.02 The sta£f of the City, the staff of the Authority and the City's and Authority's advisors and legal counsel are authorized and directed to proceed with the implementation of the Tax Increment District and the Tax Increment Financing Plan and for this purpose to negotiate, draft, prepare and present to the Board of Commissioners of the Authority for its consideration all further plans, resolutions, documents and contracts necessary £or this purpose. Adopted by Council: Date �O� l Adoption Certified y Council Secretary HY: � �— Approved by Mayor: Date � LB(y�D sy: Reguested by Department of: Plannina & Economic Develonment � By: `�/ t'� Form Approved by City Attorney I �% �� / �, Approved by Mayor for Submission to Council B 1 �`r�"'� DEPARTMENt/OFFICE/COUNCIL: DATE INITIATED GREEN SHEET No.: 101691 PED 7/28/00 0 0-7 3� CONTACI PERSON & PHONE: - INmnLmA'es miTlnunAiE ALLEN CARLSON 6-6616 � y DEPARI'MENT DIR s ct� covxca. M[JSI BE ON COUNCII, AGENDA BY (DATE) �G� 3 CITY ATTORNEY �I CITY CLERK All�iLSY 9, ZOOO FOR FINANCIAL SERV DII2. _ FAIANCIAL S V/ACCTG ROUTING 4 MAYOR (OR ASST.) 1�A�S�A� � PUBLIC HEARING ORDER coc.�nssiox TOTAL # OF S[GNA7'URE PAGES _I (CLIP ALL LOCATIONS FOR SIGNATURE) acriox xEQuESrEV: . Public hearing to approve T� Increment Financing Disfrict No. 1(North Quadrant) RECOMIv]ENDATI013S: Approve (A) or Reject (R) PERSONA[. SERViCE CON7'RAC1S M[7ST ANSWER TI�E FOLLOWRVG QUESTIONS: PLANNING COA9vIISSION 1. Has this personiSrm ever workeA undet a conhact for this depaztmenY? CIB COM��IITTF.E Yes No CIVII. SERVICE COMMISSION 2. Has this person/fum ever been a city employee? Yes No 3. Does this person/fimi possess a skill not noanal7y possessed by any current city employee? Yes No Explain aIl yes answers on separate sheet and attach to green sheet INI17A1'ING PROBLEM, ISS[IE, OPPORT[7N11'Y (WLo, What, When, Where, Why): Creation of t� increment financing and street on block bounded by 7th, 8th Wacouta and Sibley streets will a11ow fmancial assistance to construction of ll4 rental units of which 46 are affordable, 38 for sale town homes and 13,000 sq. ft. of commercial. ADVANTAGES IF APPROVED� This project is part of North Quadrant Redevelopment Plan to create urban village in North Quadrant of downtown St. Paul. DISADVANTAGESIFAPPROVED: DISADVANI'AGES IF NOT APPROVED: Project will not proceed forwazd. TOTAL AAiOUNT OF'fRANSACI'iON: $ COSTlREVENUE BUDGETED: FL7NDING SOURCE: ACTIVTTY NUMBER: FIlVANCL4L INF012MATION: (EXPLAIN) A �„ps��rct� Cerfe� �� ��P�YS2�Sha.ed�KAPLANt.�^%��frm po ��71 Interdepartmental Memorandum CITY OF SAIN'I' PAUL TO: Council President Bostrom Councilmember Benanau Councilmember Blakey Councilmember Coleman Councilmember Harris Councilmember Lantry Councilmember Reiter FROM: Brian Sweeney Allen Cazlson DATE: 7uly 28, 200� RE: PUBLIC FIEARING: RESOLUTION ESTABLISffiNG TAX INCREMENT FINANCING DISTRICT NO.1(NORTH QUADRANT) AND ADOPTING THE RELATED TAX INCREMENT FINANCING PLAN Purpose The purpose of this public hearing is to receive public comment and request the City Council to approve a resolution which establishes TaY Increment Financing District No. 1(North Quadrant) which is bounded by 7`", 8�' , Wacouta and Sibley Streets. Adoption of the Tax Increment District will allow increments to be generated to assist in the fmancing of a proposed 114 multifamily rental building with 13,000 square feet of commercial space and a 38 unit for sale town home development. Twenty-two percent of the rental units will be affordable to households at or below 30% of the azea median income and 18% of the rental units will be affordable to households at or below 50% of the area median income, BackgroundlProposal The North Quadrant Redevelopment Project Area is on the immediate edge of the core of downtown Saint Paul and is generally bounded by Highway I-94, Jackson Street and East 7th Street. The area is currently characterized by underutilized buildings and large surface parking Page 1 of 7 aa���1 lots although there aze positive assets such as the First Baptist Church, St. Mary's Catholic Church, as well as an assortment of smaller viable businesses. In June of 1999, the City Council adopted the North Quadrant Redevelopment Plan wluch set development objec6ves and urban design guidelines for the azea. A major component of the plan was to foster an 3ncrease in the residential population of downtown including increased opporiunities for affordable housing in accordance with the Saint Paul Housing Plan. Sherman and Associates specializes in the design, construction and financing of rental and ownership housing in Minnesota, North and South Dakota and Wisconsin. They have developed over 3,000 of single family and multifamily homes since 1978. The Lander Group is a full service real estate development company known for high quality urban infill housing. On December 22, 1999, the HI2A Boazd approved Resolution 99-12/22-11 granting the Developer tentative developer designation with the task to finalize financing, prepaze plans and negotiate terms and conditions of a development agreement. Proposal The Developer is proposing a two phase project beginning conshuction this fall on Block 31 adjacent to 7th Street. Phase Two would start in the suuuiier of 2001 on block 17. The Developer's proposal(3.0 acres) constitutes approximately ten percent (10%) of the totalland area of the North Quadrant Redevelopment Project Area . The multifamily rental units which would be 4- 5 stories high would be located along 7th Street and Temperance Street. The 76 for-sale town homes would front along the new park on 8th and Sibley Street. Project I construction will include a 114 unit multifamily L-shaped building with 13,000 square feet of commerciaUretail space on the first floor fronting 7th Street and underground parking far entire building. Project I will also include construction of 38 for-sale town homes. Project II will be a mirror image of Project I except that rental component will have no commercial space and 118 units. In order to accommodate Project II, Sibley Street will need to be moved sixty feet to the East to aliow for a similaz size biock as Project I. The cost of moving the Street, estnnated at $253,OOQ, will be funded with the Communities Livability Grant the City was recenUy awarded by the Metropolitan Council. The nronosed unit 20 >, mix and rents for the Project I multi: Studio MktRate 780 32 1 BR 16 2BR 17 � 2BR (Sec 8) 8 � 3 Br (Sec 8) I1 I 1BR 6 I 2 BR Mkt Rate Mkt Rate 30 30 50 50 Page 2 of 7 1,030 1,290 684 925 b16 738 rental buildine is as follows: 550 850 1,100 L,L00 1,300 850 1,100 00 -'1�� 4 3 Br 5� 8i4 1,300 114 Project II will have an almost identical mix of unit types and afford ability. For Project I, 40% of units wili be affordable pursuant to the Housing Action Plan's policy goals. Specifically, 22% (25) of the units will be affordable to households at or below 30% of the azea median income and 18% (21) units wili have rents affordable to households at 50% of the azea median income. The annual income of a two person household at 50% of the area median income is $26,300, whereas, the income for a 4 person household at or below 30% of the area median income is $19,700. The 38 Project I for sale units will range in size from 850 to 2,250 square and sale prices from $119,000 to $345,000, thus being affordable to households between 80% and 140°/a of the azea median income. The higher priced units will be two stories with separate ground floor access. The upper two levels of the complex wiil have single level flats. Appro�mately, 60% of the units will be affordable to households at or below 115% of the area median income. The under ground parking structure will have a total of 143 spaces of which 88 spaces wi11 be devoted to the rental units and 55 spaces will be devoted to the for sale units. Proposed Financial Structure ofthe Project Due to timing and limited City financial resources it is proposed that Project I and Project II be fmanced separately and differently. The proposed means to finance the Project I rental component is as follows: Sources of Fmds Uses of Funds FicstMortgage $7,125,000 LandSales $335,QQ0 Tae Increment Mortgage 1,945,000 Construction 12.008,000 ffi2A HOME Defe[red Mortgage 750,000 Parking Structure 1,600,000 II2A gcant 250,000 Professionffi Fees 451,60� Met Council Defened Mortgage - 500,000 Soft Costs 165,800 Inclusionary MHFA Deferred Mortgage - 70Q000 Construcfion Financing Costs 759,600 Employer Challenge Family Housing Fund Deferred I50,000 Working Capital Reserve 151,400 Mortgage Taac Credit Syndicated Equity 5,200,000 Operating Deficit Reserve 30Q000 Developer Letter of Credit 481,400 Developet Fee 1,30Q000 Total $17,1O1,A00 Total $17,1O1,A00 The $7,125,000 first mortgage loan to be repaid &om pro}ect revenues will be a 221(d}(4) HUD insured note amortized over a 40 yeu term and interest rate of 8.5%. The tax increment mortgage wall also be HUD insured with a amortized 25 year term, interest rate of 8.5% and Page 3 of 7 Oo-��1 secured with a pay-as-you-go tax increment note provided by the City. The pay-as-you-go note only pledges increments from the TIF district and places no obligation or debt upon the City or HRA. The Metropolitan Council, Minnesota Housing Finance Agency and Family Housing Fund have jointly awarded $1,350,000 of defened subordinate mortgage loan proceeds to Project I. Forty percent of Phase One will have an eligible basis to syndicate low income housing tax credits. The Developer will need approximately $522,000 of tax credits, which the City has using the balance of its 2000 allocation and all of its yeaz 2001 allocation. The tax credit will leverage approximately $5.2 million of syndicator equity to Project I covering 30% of the total development cost. U.S. Bank is purchasing the credits at a premium of $0.92 on the dollar. (Normal rate is about $0.81) The premium being paid by U.S. Bank enable the City to successfully receive $700,000 under MHFA's Employer Challenge fund program (part of the $1.35 million contribution). The Developer will be required to fund $481,000 towards a working capital and operating deticit reserve fund, therefore the actually developer fee will be $819,000 which is lower than the $833,000 allowed pursuant to the developer fee resolution adopted by the Board. Despite the substantial financing resources secured so far for the rental building, the project is still $1 million short of being fully funded. Staff is recommending the gap be filled with a $750,000 loan from the federal HOME Program. The loan would be amortized over 30 year with a 3% interest rate. In addition, staff is recommending a$250,000 grant from the HRA Enterprise fund which would help to fulflll the City's local match requirement to use tax increment funds for ProjectI. The proposed financiug for the 38 for sale units of Project I is as follows: Sources of Funds Uses of Funds Snles Proceeds $7,672,000 Acquisition $ll5,000 T�x Increment Funds I,OOQ000 Underground Parking 950,000 MHFA/Met Council 900,000 Site work 150,000 Construction 5,625,000 Holding costs 575,000 ProfessionaVMarketing 671,000 ArchitecUEngineering 236,000 Contingency - 2% 200,000 Profit 1,050,000 Total $9,572,000 Total $9,572,000 The sales price points are based upon the style of units being constructed and estimates from the Page 4 of 7 Od -'�3 � M�eld Matket Study. Its estiruated that sales proceeds will cover approxiinately 80% of the actually cost to construct the town homes. A major cost of Project I is the underground parking shuchue. Basically, the tas increment provided to Project I is paying the cost of the parking. The average per unit cost is $251,894 of which pazking constitutes $25,000 per unit. The average sales price is $201,894, thus leaving a$SQ,OQO gap between sale proceeds and cost. The City's portion to fill the gap is $26,315 per unit wluch is withiu established City policy. The City's financing gap is recommended to be funded enfuely through tas increment funds in which the Developer will sell a note provided by the City to an investor such as Fannie Mae or U.S. Bank. The Developer will be encouraged to increase the sales prices as units aze sold. 5taff has negotiated a 35% participation in the increased base sales price of any unit so1d. Should sales prices increase during Project I, new base sales prices will be established for Project II which will result in a lower tas increment participation on the part of the City. Taa Increment Financing District Due to the high cost of development including land acquisition and fmancing the proposed improvements such as the underground parking for Project I, this project is feasible onip through assistance, in part, from tax increment financing. The district would be bounded by 7�`, 8`�` , Wacouta and Sibley Streets. A copy of the Plan and project azea map is attached as E�ibit A. The 2000 session of the Minnesota Legislature passed and the Governor signed a speciallaw for the Northeast Quadrant that allows the creation of a TIF district for an owner and rental occupied residenfial housing development for mixed income occupancy. Formerly, TIF district regulations either appiied to rental or to ownership exclusively. Under the new law, only for the North Quadrant, 60% of the units in the development must have income less than 115% of the area median income and 2Q% of the units must be occupied by households at or below 50% of the area median income. The balance of the units do not have income restrictions. Under prior eYisting law 95°l0 of the ownership units had to be occupied by households at or below 115% of the area median income. The new law provides much more flexibility in formulating developments and stil] provides a high level of afford ability. Public Purpose Project I meets several of the objectives, strategies and operating principles of the Housing Action Pdan 2000 as follows: 1. Support the production of ownership and rental housing in Saint Paul. Project I`s 152 uniis meet 20% of the goal to provide immediately 750 new housing units in the city. The availability of rental housing, especially affordable rental housing is extremely low. 2. provides a diversity of building and unit types, rental and ownership. 3. Fosters economic integratian for both rentat and ownership units. 4. Subsidizes the provision of low income housing units in new housing developments. 5. Provides quality housing to create an ariracfive neighborhood and links naw development to broader community objectives. Project I promotes "New Urbanism". It combines mixed-use, mixed-income, transportation linkages and employment connections. 6. follows the principles of the Saint Paul on the Mississippi Development Framework. Page 5 of 7 Oo -73� Neighborhood Input The CapitolRiver Council and its North Quadrant Advisory Committee have actively worked with the Developer regazding the design and financing of Project I and II. Findings of Fact to Support Adoption of Tax Increment Financing Bistrict No. 1(North Quadrant) The reasons and faets supporting the findings for adoption of the Tax Increment Financing District I�3o. 1(North Quadrant) pursuant to MN Statutes, Section 469.175, Sub. 3, are as foliows: 1. Finding tTzat the District is a°housing distr-ict. " This Taac Increment District is in the public interest because it will provide needed multifanuly housing Saint Paul of which at least 20% of the units will be affordable to households at or below 50% of the azea median income. In fact the district will pzovide affardable housing of which 40% will be affordable for rental housing and 60% of the ownership units will be affordable pursuant to state definition of affordable ownership housing. 2. Finding that the proposed deveZopment, zn the o�inion of the Council, would not reasonably be expected to occur solely through private investment within the reasonably for�eseeable�istac�-e and tluit the increased market value of the site that coutd reasonably be expected to occur without the use of tc� increment fznancing would be Zess than the increase in the market vatue estimated to result from the proposed development after subtracting the present value of the projected tax inerements for the maxiTnum duratlon of the district permitted by the plan. Due to the high cost of development on the parcels including the cost of land acquisition and financing the proposed improvements, this project is feasible only through assistance, in part, from tax increment financing. A comparative analysis of estimated mazket values both with and without establishment of the Taac Increment Financing District No. 1(North Quadrant) and the use of tas increments has been performed as described above. If all development which is proposed to assist with t� increment were to occur in the proposed Project I, the total increased market value would be up to $15,749,244. It is the Council's finding that no development with a mazket value of greater than $15,744,244 would occur without ta�c increment assistance in this district within 15 years. This finding is based upon evidence from general past eaperience with the high cost of providing public improvements in the general azea of this District. Finding that the Tczz Increment Financing District No. 1(North Quadrant) conforms to Page 6 of 7 a� -�a � the general plan for the development or redevelopmenf of the municipality as a whole. The Establishment of the Tas Increment Financing District No. 1(North Quadrant) for the North Quadrant Development Project Area conforms to the City's Comprehensive Plan and Saint Paul on the Mississippi Development Framewark . 4. Finding thar the Establishment of the Tax Zncrement Financing Dis£rict Na 1(Norih Quadr�ant) far the North Quadrant Redevelopment ProjectArea will afford mazimum opportunity, conszstent with the sound needs of the City as a whole, far the development of the North Quadrant Redevelopment Project. The number of housing units to be developed will increase the housing stock in the City and the State of Minnesota. Recommendation Staff recommends and requests the City Council to consider adoption of the attached resolution which approves and adopts the following: Estabiishment of the Tax Increment Financing District No. 1(North Quadrant); and The T� Increment Financing Plan to finance the Project. Statement of the Council President Being duly authorized by the City Council to conduct this Public Hearing, the hearing is now open. This Public Heazing is calied for the proposed purpose to consider the following: Estabiishment of the Tau Increment Financing Disttict No.l (North Quadrant); and Approval of the TaY Increment Financing Plan. Notice of tnne, place, and purpose of this hearing was published in the Saint Paul Legal Leger on July 27, 2000. The affidavit of the publicafion of the Notice of Public Hearing will be made a part of these proceedings. Is there anyone who wishes to be heard on this item? If not, the Chair will declare this Public Hearing adjourned. Attachments Tax Tncrement Financing District No. 1(North Quadrant) Resolution approving TaY Increment Financing District No. 1(North Quadrant} Page 7 of 7 � 00-'?3� TAX INCREMENT FINANCING PL�1N for the establishment of TAX INCREMENT FINANCING DISTRICT N0. 1(NORTH QUADRADTT) (a housing district) within the NORTH QUADRAI3T REDEVELOPMENT PROJECT AREA HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF SAINT PAUL RAMSEY COUI3TY STATE OF MINNESOTA Adopted: August 9, 2000 This documenC was dra£ted by: SRIGGS AND MORGAN, (MNID) Professional Association 2200 First 23ational Bank Bldg. St. Paul, N3N 55101 (651) 223-6625 1193029.2 00 -73 � TABLE OF CQNTENTS (for reference purposes only) TAX INCREMENT FINANCING P TAN FOR TAX INCREMENT FINANCING DISTRICT N0. 1(NORTH QUADRANT) Pa4e Subsection 1. Subsection 2. Subsection 3. Subsection 4. Subsection 5. Subsection 6 Subsection 7 Subsection 8 Subsection 9. Subsection 10 Subsection 11 Subsection 12 Subsection 13 Subsection 14 Subsection 15 Subsection 16 Subsection 17 Subsection 18 Subsection Subsection Subsection Subsection 19. 20. 21. 22. 8ubsection 23 Subsection 24 Subsection 25 Subsection 26. Subsection 27. Subsection 28. Subsection 29 Forward . . . . . . . . . . . . . . . . . Statutory Authority . . . . . . . . . . . Statement of Objectives _ . . . . . . . . Redevelopment Plan Overview . . . . . • • Parcels to be Included in Tax Increment Einancing District No. 1 . . . . . . . . Parcel in Acquisition . . . . . . . . . . Development Activity in Tax Increment FinanCing District 230. 1 for which Contracts have been Signed . . . . . . . Other Speci£ic Development Expected to Occur within Redevelopment Area .. Estimated Cost of Project . . . . . . Estimated Amount of Bonded Indebtedness Sources of Revenue . . . . . . . . . Estimated Captured Tax Capacity and Estimate of Tax Increment . . . . . Type of Tax Increment Financing District Duration of Tax Increment Financing District . . . • - • • • • • • • • - - Estimated Impact on Other Taxing Jurisdictions . . . . . . . - . • • State Tax Increment Financing Aid ... Modification of Tax Increment Financing District and/or Tax Increment Financing Plan . . . . . . . . . . . . . . . . ModiEications to Tax Increment Financing Aistrict . . . . . . . • • • - • • • • Administrative Expenses . . . . . . . . Limitation of Increment . . . . . . . . Use of Tax Increment . . . . . . . . . Notification of Prior Planned Improvements . . . . . . - . - • • • • Excess Tax Increments . . . • • • • . Requirements for Agreements with the Developer . . . . . . . . . . . . . . . OC.her Limitations on the L3se of Tax Increment . . . . . . . . . . . . . . . County Road Costs . . . . . . . . . . . Assessment Agreements . . . . . . . . . Administration of the Tax IncremenC Einancing District . . . . . . . . . Financial Reporting Requirements . . . . 2 . 3 . 3 . 3 . 3 . 4 . 4 . 4 . 5 � 9 10 10 12 12 13 13 14 is 15 15 15 1183029.2 ao-73� EXHISIT A- Map of Ta�c Sncrement District No. 1 EXHIBIT B- Map of 13orth Quadrant Redevelopment Project Area EXHIBIT C- Projected Tax Increments 1183029.2 00-'131 TAX INCREMENT FINANCII3G PLAN FOR TAX INCREMENT FINA23CING DISTRICT NO. 1(NORTH QUADRANT) Subsection 1. Forward. The Aousing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "HRA"), and iCs staff and consultants have prepared the following information for the establishment of Tax Increment Financing District No. 1 (23orth Quadrant), a housing district (the "Tax Increment District"). The Tax Increment District is located within the North Quadrant Redevelopment Project Area (the "Redevelopment Project Area") established by the HRA pursuant to the North Quadrant Redevelopment Plan adopted by the HRA on June 23, 1999 (the "Redevelopment Plan"). The Redevelopment Plan was approved by the Planning Commission on June 23, 1999. Subsection 2. Statutorv Authoritv. There exist areas within the City of Saint Paul (the "City") where public involvement is necessary to cause devel.opment to occur. To this end, the HRA has certain statutory powers pursuant to special legislation (Laws of Minnesota, Chagter 490, Article 11, Section 40 (the "Special Law"), and Minnesota Statutes, Section 469.174 through 469.179 (the "Tax Increment Financing Act" or "TIF Act"), to assist in financing public costs related to a project. Subsection 3. Statement of Objectives. The Tax Increment Financing District consists of 2 parcels of land and adjacent and internal rights-of-way. A map showing the boundaries of the Tax Increment District is attached as Exhibit A. The Tax Increment Financing District is being created to facilitate a 38 unit owner occupied townhome development and a 114 unit rental apartment facility. The tax increment financing plan is expected to achieve many of the objectives outlined in the Redevelopment Plan for the North Quadrant Redevelopment Project Area. The following are some of the objectives being facilitated by this Tax Increment Financing Plan. A_ Provide Affordable Housina for Saint Paul Residents. The available housing in the downtown area of the city will expand by more than 152 units with the completion of the housing development contemplated by this Tax Increment Financing Plan. B. To Redevelo� Underused Propertv. The Tax Increment District is a site that has been underutilized for many years. The majority of the area comgrising the site has been used for surface parking. New commercial, cultural and recreational investments are jeopardized by lack of development in the downtown area. 25 of the units in the rental portion of the development will be affordable to households at or below 30% of the area median income and 23 units will be 1183029,2 da-�3� affordable to households at or below 50°s of the area median income. 23 of the owner-occupied units will be affordable to households between 8�a and 115% of area median income. In order to protect past investments and encourage new development in the downtown area new housing development needs to be created to encourage additional private investment. C. Expand the Tax Base of the Citv of Saint Paul. St is expected that the taxable markeC value of parcels in the Tax Increment District will increase by approximately $21,280,000. The acCivities contemplated in the Redevelopment Plan and this Tax increment Financing Plan do not preclude the undertaking of other qualified development or redevelopment activities. These activities are anticipated to occur over the life of the Tax Increment District and the Redevelopment Project. Subsection 4. Redevelopment Plan Overview. 2 Property to be Acquired - Selected property located within Tax Increment Financing District or Redevelopment Project Area may be acquired by the HRA. Relocation � if necessary, complete relocation services are available pursuant to Minnesota Statutes, Chapter 117 and other relevant state and federal laws. Upon approval of a developer's plan relating to a development and completion of the necessary legal requirements, the HRA may sell or assist a developer with the cost of selected properties within Tax Increment Financing District or Redevelopment Project Area, or may lease land or facilities to a developer. 4. The HRA may perform or provide for some or all necessary acquisition, construction, relocation, demolition, and required utilities and street work within Tax Increment Financing District No_ 1. Subsection 5. Parcels to be Included in Tax Increment Financina District No. 1. The following parcels located in the City of Saint Paul, Ramsey County, Minnesota: PIN NO. 312922440028 312922440029 ADDRESS 221 7 Street East 440 Sibley Street 1183029.2 2 OO -�31 FURTHER I23FORMATION REGARDING THE IDENTIrICATION OF THE PARCEL TO BE INCLUDED IN TAX INCREMENT FINANCING DISTRICT N0. 1 CAN BE OBTAINED FROM THE EXECUTIVE DIRECTOR OF THE HRA• Subsection 6. Parcel in Accruisition. The IiRA may finance all or a part o£ the cos�s of acquisition of the parcels identified in Section 5 of this Tax Increment Financing Plan. The following are conditions under which properties not designated to be acquired may be acquired at a future date: (1) The ARA may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of the tax increment financing plan; and (2) Such acquisitions wi11 be undertaken only when there is assurance of funding to finance the acquisition and related costs. Subsection 7. Kinanciu L������� �.... _.._ •.----- - — The following contracts have been or will be entered into by the HRA and the gersons named below: No development agreements have been entered into at this time. However, the HRA anticipates entering into a flevelopment agreement with an entity to be formed by George Sherman Associates and the Louder Group (the "Developer") with respect to the development of a 38 unit owner occupied townhome development and a 114 unit rental apartment facility. Subsection 8. Other Soecific Development Exoected to Occur within Redevelooment Area. Although no specific additional developments have identified at this time, the HRA expects that the acquisition and construction of the above housing development will encourage additional development the Redevelopment Project Area. been in SubsecCion 9. Estimated Cost of Proiect. The HRA has determined that it will be necessary to provide assistance for certain public costs of certain housing activities. To facilitate the development of the Tax Increment Financing District, Chis Tax Increment Financing Plan authorizes the use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs and uses of funds associated with Tax Increment Financing District is outlined in the following table: 1183029.2 00 -�31 Uaes of Funds Land Acquisition Site Preparation Parking Interest Costs Administrative Costs TOTAL Rental 335,000 1,600,000 Owner AccLuired 115,000 150,000 950,000 Total $ 450,000 150,000 2,550,000 5,500,000 970.000 $9,625,000 Estimated costs associated with Tax Increment Financing District are subject to change. The cost of a11 activities to be considered for tax increment financing will not exceed, without formal modification, the budget above pursuant to the applicable statutory requirements. Subsection 10. Estimated Amount of Bonded Indebtedness. No bonded indebtedness is anticipated to be issued. The expenditures authorized by this Tax Increment Financing Plan will be paid for on a pay-as-you-go basis. Subsection 11. Sources of Revenue. Land acquisition, demolition, and other costs outlined in Section 9 above under the Estimated Cost of Project will be financed through the annual collection of tax increments as described below. The total cost of the 114 rental apartment facility are estimated to be approximately $17,000,000. The total cost of the 38 unit owner occupied townhome development is estimated to be approximately $9,500,000. The sources of revenue for these costs include a star loan from the City or HRA federal HOME funds, together totaling approximately $1,000,000, grants or loans from the Metropolitan Council of approximately $900,000, and assistance from the Minnesota Housing Financing Agency of approximately $1,300,000. The Developer will contribute equity or obtain private financing for the remaining cost of the housing developments. Subsection 12. Estimated Captured Tax Capacitv and Estimate of Tax Increment. The most recent tax capacity of Tax Increment Financing District is estimated to be $10,577 as of January 2, 1999. The estimated captured tax capacity of Tax Increment Financing District at completion is estimated to be $254,812. The HRA elects to retain all of the captured tax capacity to finance the costs of Tax Increment Financing District No. 1. The 1183029.2 00 -�31 In making this determination the HRA has relied on its own knowledge of the development history of the area and on representations made by the Developer. The HRA and the City have detexmined that the proposed development of the Tax Tncrement DistricC would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the district permitted by the plan. SubseCtion 14. Duration of 7'ax lncremenL r���a��c.:��,u ,��������. The duration of Tax Increment Financing District will be 25 years from the receigt of the first tax increment. The date of receipt of the first tax increment is expected to be July of 2002. Attached as Exhibit C is the projected receipt of tax increments from Tax Increment Financing District. Subsection 15. Estimated Impact on Utner �i�axin �urisa�c- tions. The estimated impaCt of Tax Increment Financing District on the other taxing jurisdictions assumes construction would have oCCUrred without the creation of Tax Increment FinanCing District. If the construction is a result o£ tax inCrement financing, the impact is $0 to other entities. Notwithstanding the fact that the fiscal impact of the other taxing jurisdictions is $0, due to the fact that the construction would not have occurred without Che assistance of the HRA, the following estimated impact of Tax Increment Financing District would be as follows if the "but for" test was not met: iiaaozs.s 6 L m n � � c� A N L C. C m U O O �O � R � ° a L7 � m �" _ � 9 U Z F 0 0 0 0 R � . n m � N U m _� O O , N o � O¢ O O O O Q � J K = 0 � 0 0 0 0 N . c0 rn o� O U 'O N l� � t�D. L � O 2 (0 O f�l h t7 R � L J T Q N 2 1- � N N O m N N 0 a � � � y � y C t Z R 0 5 � £ o F- Z y � a co � C �V O y O C d � > m u � d v N �.� p� fD d d ry x ? 0 C C v � .tl = I m d N m o, c C A O d a Q U Z 'cL O T O R . a! � O. ~ � 9 A A .0 a d T F- S O ..t � m � N a m a c � ~ o ° °' �� rnr T � y .� a V u � s £ C 9 a x � ' d F 0 � p « ' o � N O C � N � y � Z d p� J Uj o' � � W � � � � a 'ti L � � `o � o m � d � N � F Q. m % m rn F% Z m z F W M m P O • m � O � Oi N m N � N ' ' N � cp m � N N N N �[ C � n o � � N � 0 N M � 0 0 0 0 0 c � n m u`�i c� ° v � n � c7 O N � O N m rn �i 1� O 1� � N � � T a � C m � a o � N m � o y se `!' T t0 � � O U ¢ `!� O t- N 0 a `� m U o R x « a m ,�_, �? V � R « � 0 ¢ p � � m ~ R y .� � � O U 0 � m L L 'R � $ a R ¢ tq T > 0 T R L � � (6 (�J V 0 t � .�c « � ~ 3 > , a m � d N m y O o. �. � > c r = - n H y 3 N O d N L m U ¢ 0 N � 9 �p O A N X O N � ~ � � LL r � y � Y F U K O 'O � a � J = � `m .c � 3 2` ui O � N N U U 0 �, d � 'C p_ m ro N m U o. a w Q� x� ci ° ro m�- t`- u X O V m � O F@ 3 � r� Z o m j C 0 O d 9 Z m p o. �' m � E y � ��m m ry ? 5 m m m U m o ti E� U v� U o h o m � c � � = N F- �c6 O C N O Z � R N � � n o m S E a N a N � d� � ., a m � � y m� 7 V U � y Q x 3 m � L `� o D N V C - � 3 3 ¢ v1 r N C C E E d N � r Ul N �O-�3� m ro � o $ � `o 9 � o C P � ^ T � .. >. � O N a u�i N m � a . � u_ m f � a m 0 U � c N W m U � T � V m ro m a c @ !i) V N x � o J c v � N (� 'C O � 11 � � 'z U � � 0 � N U L m C O 9 V C � TS E x d N L F- F- .� v O N W N O m `m O J C n N � n N fl m o. a � -�31 Subsection 17. M odification of Tax lncremenc rinanc�nv District andlor Tax Increment Rinancina Plan. As of August 9, 2000, no modifications to Tax Increment Financing District No. 1 or the Tax Increment Financing Plan therefore have been made. Subsection 18. In accordance with Minnesota Statutes, Section 469. 175, Subd. 4, any: 1. reduction or enl.argement of the geographic area of the Tax Increment Financing District; 2. increase in amount of bonded indebtedness to be incurred, including a determination to capitalize interest on 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; 3. increase in the portion of the captured net tax aapacity to be retained by the HRA; 4. increase in total estimated tax increment expenditures; or 5. designation of additional property to be acquired by the HRA, shall be approved upon the notice and after the discussion, public hearing and findings required for approval of the original plan. The geographic area of District may be reduced, but sha11 not be enlarged after five years following the date of certification of the original net tax capacity by the county auditor. The requirements of this paragraph do not apply if (1) the only modification is elimination of parcel(s) from Tax Increment Financing District and (2)(A) the current net tax capacity of the parcel(s) eliminated from the Tax Increment Financing District equals or exceeds the net tax capacity of those parcel(s) in the Tax Increment Financing District's original net tax capacity or (B) the HRA agrees that, notwithstanding Minnesota Statutes, Section 469. 177, Subd. 1, the original net tax capacity will be reduced by no more than the current net t� capacity of the parcel(s) eliminated from the Tax Increment Financing District. The ARA must notify the County Auditor of any modification that reduces or enlarges the geographic area of the Tax Increment Financing District or the Redevelopment Project Area. Modifications to Tax Increment Financing District in the �orm of a budget modification or an expansion of the boundaries will be recorded in the Tax InCrement Financing Plan. 1183029.2 00 -731 Subsection 19. Administrative Expenses. In accordance with Minnesota Statutes, Section 469.174, Subd. 14, and Minnesota Statutes, SeCtion 469.176, Subd. 3, administrative expenses means all expenditures of the HRA, other than: 1. amounts paid 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; 2. relocation benefits paid to or services provided for persons residing or businesses locaCed in the district; or 3. amounts used to pay interest on, fund a reserve for, os sell at a discount bonds issued pursuant to Minnesota Statutes, Section 469.178. Administrative expenses also include amounts paid for services provided by bond counsel, fiscal consultants, and planning or economic development consultants. Tax increment may be used to pay any authorized and documented administrative expenses for the Tax Increment Financing District up to but not to exceed 10 percent of the total tax increment expenditures authorized by the tax increment financing plan or the total tax increment expenditures, whichever is less. Pursuant to Minne5ota Statutes, Section 469.176, Subd. 4h, tax increments may be used to pay for the county's actual administrative expenses incurred in connection with the Tax Increment Financing District. The county may require payment of triose expenses by February 15 of the year following the year the expenses were incurred. Pursuant to Minnesota Statutes, Section 469. 1.77, Subd. il, the county treasurer shall deduct an amount equal to 0.1 percent of any increment distributed to the HRA and the county treasurer shall pay the amount deducted to the state treasurer for deposit in the state general fund to be appropriated to the State Auditor for the cost of financial reporting of tax increment financing information and the cost of examining and auditing authorities' use of tax increment financing. Subsection 20. Limitation of Increment_ Pursuant to Minnesota Statutes, Section 469. 176, Subd. 1(a), no tax increment shall be paid to the HRA Eor the Tax Increment Financing District after three (3) years from the date of certification of the Original Net Tax Capacity value of the taxable property in the Tax Increment Financing District by the County Auditor unless within the three (3) year period: 1183029.2 1� ao -�3� (a) bonds have been issued pursuant to Minnesota Statutes, Section 469. 178, or in aid of a project pursuant to any other law, except revenue bonds issued pursuant to Minnesota Statutes, Sections 469.152 to 469.165, or (b) the HRA has acquired property within the Tax Increment Financing District, or (c) the HRA has constructed or caused to be constructed public improvements within the Tax Increment Financing District. The tax increment pledged to the payment of bonds and interest thereon may be discharged and may be ternlinated if sufficient funds have been irrevocably deposited in the debt service fund or other escrow account held in trust for all outstanding bonds to provide for the payment of the bonds at maturity or redemption date. Pursuant to Minnesota Statutes, Section 469.176, Subd. 6: if after four years from the date of certification of the original net tax capacity of the tax increment financing district pursuant to Minnesota Statutes, Section 469.177, no demolition, rehabilitation or renovation of property or other site preparation, including qualified improvement of a street adjacent to a parcel but not installation of utility service including sewer or water systems, has been commenced on a parcel located within a tax increment £inancing district by the authority or by the owner of the parcel in accordance with the tax increment financing plan, no additional tax increment may be taken from that parcel and the original net tax capacity of that parcel sha11 be excluded from the original net tax capacity of the tax increment financing district. If the authority or the owner of the parcel subsequently oommences demolition, rehabilitation or renovation or other site preparation on that parcel including qualified improvement of a street adjacent to that parcel, in accordance with the tax increment financing plan, the authority shall certify to the county auditor that the activity has commenced and the county auditor shall certify the net tax capacity thereof as most recently certified by the commissioner of revenue and add it to the original net tax capacity of the tax increment financing district. The county auditor must enforce the provisions of this subdivision. For purposes of this subdivision, qualified improvements of a street are limited to (1) construction or opening of a new street, (2) relocation of a street, and (3) substantial reconstruction or rebuilding of an existing street. 1153029.2 1�- ao - �3� Financing District and found no parcels for which building permits have been issued during the 18 months immediately preceding approval of the Plan by the HRA. Subsection 23. Excess Tax Increments. Pursuant to Minnesota Statutes, Section 469.176, Subd 2, in any year in which the tax increment exceeds the amount necessary to pay the costs authorized by the Plan, including the amount necessary to cancel any tax levy as provided in Minnesota Statutes, Section 475. 61, Subd. 3, the HRA shall use the excess amount to do any o£ the following: 1. prepay any outstanding bonds; 2. discharge the pledge of tax increment therefor; 3. pay into an escrow account dedicated to the payment of such bond; or 4. return the excess to the County Auditor for redistribution to the respective taxing jurisdictions in proportion to their local tax rates. In addition, the HRA may, subjec� to the limitations set forth herein, choose to modify the Plan in order to finance additional public costs in the Tax Increment Financing District or Redevelopment Project Area. Subsection 24. Recruirements for Agreements with the Developer. The HRA will review any proposal for private development to determine its conformance with Che Redevelopment Plan and with applicable municipal ordinances and codes. To facilitate this effort, the following documents may be requested for review and approval: site plan, construction, mechanical, and electrical system drawings, landscaping plan,.grading and storm drainage plan, signage system plan, and any other drawings or narrative cleemed necessary by the City to demonstrate the conformance of the development with city plans and ordinances. The HRA may also use the Agreements to address other issues related to the development. Pursuant to Minnesota Statutes, Section 469.176, Subd. 5, no more than 10 percent, by acreage, of the property to be acquired in the Tax Increment Financing District as set forth in the Plan shall at any time be owned by the HRA as a result of acquisition with the proceeds of bonds issued pursuant to Minnesota Statutes, Section 469. 178, without the HRA having, prior to acquisition in excess of 10 percent of the acreage, concluded an agreement for the development or redevelopment of the property acquired and which provides recourse for the HRA should the development or redevelopment not be completed. 1183029.2 �"3 00-�1� Subsection 25. Other Limitations on the Use of Tax Increment. l. General Limitations. A11 revenue derived from tax increment shall be used in accordance with the Plan. The revenues shall be used to finance, or otherwise pay the capital and administration costs of the Redevelopment Project Area pursuant to the Minnesota Statutes, Sections 469.124 to 469.134; These revenues shall not be used to circumvent existing levy limit law_ No revenues derived from tax increment shall be used for the acquisition, construction, renovation, operation or maintenance of a building to be used primarily and regularly for conducting the business of a municipality, county, school district, or any other local unit of government or the state or federal government, or for a commons area used as a public park, or a facility used for social, recreation or conference purposes. This provision shall not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure. 2. Pooling Limitations. At least 80 percent of tax increments from the Tax Increment Financing District must be expended on activities in the Tax Tncrement Financing District or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities within said district or to pay, or secure payment of, debt service on credit enhanced bonds. Not more than 20 percent of said tax increments may be expended, through a development fund or otherwise, on activities outside of the Tax Increment Financing District except to pay, or secure payment of, debt service on credit enhanced bonds. For purposes of - applying this restriction, all administrative expenses must be treated as if they were solely for activities outside of the Tax Increment Financing District. 3. Five Year Limitation on Commitment of Tax InCrements. Tax increments derived from the Tax Increment Financing District shall be deemed to have satisfied the 80 percent test set forth in paragraph (2) above only if the five year rule set forth in Minnesota Statutes, Section 469. 1763, Subd. 3, has been satisfied; and beginning with the sixCh year following certification of the Tax Increment Financing DisCrict, 80 percent of said tax increments that remain aftier expenditures permitted under said five year rule must be used only to pay previously commitment expenditures or credit 1183029.2 �.� oa-731 enhanced bonds as more fully set forth in Minnesota Statutes, Section 469.1763, Subd. 5. Subsection 26. Count� Road Costs. Pursuant to Minnesota Statutes, Section 469. 175, Subd. la, the county board may require the ARA to pay for all or part of the cost of county road improvements i£, the proposed development to be assisted by tax increment will, in the judgement o£ the county, substantially increase the use of county roads requiring construction of road improvements or other road costs and if the road improvements are not scheduled within the next five years under a capital improvement plan or other county plan. In the opinion of the ARA and consultants, the proposed development outlined in this Plan will have little or no impact upon county roads. If the county elects to use increments to improve county roads, it must notify the HRA within thirty days of receipt of this Plan. Subsection 27. Assessment Agreements. Pursuant to Minnesota Statutes, Section 469. 177, Subd. 8, the FTRA may enter into an agreement in recordable form with the developer of property within the Tax Increment Financing District which establishes a minimum market value of the land and completed improvements for the duration of the Tax Increment Financing District. The assessment agreement shall be presented to the assessor who shall review the plans and specifications for the improvements constructed, review the market value previously assignecl to the land upon which the improvements are to be constructed and, so long as the minimum market value contained in �he assessment agreement appear, in the judgment of the assessor, to be a reasonable estimate, the assessor may certify the minimum market value agreement. Subsection 28. Administration of the Tax Increment Financina District Administration of the Tax Increment Financing DistriCt will be handled by the Executive Director of the HRA. Subsection 29. Financial ReportincZ Req_uirements. The HRA will comply with all reporting requirements of Minnesota Statutes, SeCtion 469.175, Subd. 5, 6 and 6a. 1183029.2 �-5 EXHIBTT A 00 -'1�1 n -�" ��r � � `M L � � � � ._ � � Z � ■ �� f.. � .... 0 �.{. .�. �"� ' � EX�IIBIT B O� -73� � an or s.aa-r rnvc �� �. . Nof�t�Z Q1cc� �: ExxsB=x c Assum tions Re ort City of St. Paut, Minnesota Proposed Tax increment (Redevelopment) Financing District North Quadrant (Sibley Park) Housing Development Scenario A- Phase One Total Project (26 years, 8% note) Type of Tax tncrement Financing District Maximum Duration of TIF District Certification Request Date Decertification Date Base Estimated Market Value Times: First 30 0.00% Excess 0.00% Original Net Tax Capacity (1) �2,683,500 575,749,244 515,749,244 $15,749,244 Assessment/Collection Year Base Estimated Market Value Increase in Estimated Market Value (1) Total Estimated Market Value Times: First Excess Total Net Tax Capacity (1) Base Inflation Factor Locat Tax Capacity Rate Fiscal Disparities Co�trlbution From TIF District Administrative Retainage Percent (maximum = 10%) Pooting Percent City Tax Rate (Only if Local-Effort TIF) Bonds Bonds Dated Firstlnterest Date Underwriters Discount $265,389 2001/2002 2002/2003 2003/2004 2004/2005 00-'13 � $683,500 $683,500 5683,500 $683,500 2,000,000 15,065,744 15,065,744 15,065,744 NA NA NA LGA/HACA Loss: Will Annual Locai Contribution Be Made (Yes or No)? (2) I.S.D #625 Equatized Tax Capacity Aate I.S.D #625 Sales Ratio City Saies Ratio & Taxable Net Tax Capacity Present Value Date & Rate Yes NA NA NA 09/01/00 NA 5.00°/, (1) See "Schedule of Project Values" for calculation of Market Values and Net Tax Capacities. (2) Assumes annual contribution will be made upfront and will not be available for debt service. Prepared by: Springsted Incorporated (printed on 06128l20�0 at 321 PM) SO 0.00% 0.00% Ftedeve4opment 25 years from 7st incremeni 09/07/00 12/Ot/27 (26 Years of Increment) 2000/2001 S683,500 0 0 $10,577 0 0 0 0 0 0 0 0 $41,527 5265,389 $265,389 NA 148.553%, (Payable 2000) 0,0000°10 (NA for Housing) 10.00% 0.00%, NA Note (Pav-As•You-Go) Note Dated 09l05f00 Note Rate 8.00% Tif0628a.xts c N C d U C x � U d N 0 d C 0 � o G p, cp �U O ` C v c v a R {L 0 T .-. p� �p y C C N. � � H U c p, o ?' � O 2 O _ � y � d W N �. � T F- d N a c O y y O � � v d d C A U � � L �aa m F t � N O � a Z c o m a` Oa��31 m 7 0 C Z 0 ¢ ¢ 0 � o j U � O O � O d J G N O V C m m m � F- E � m c m < Z = a c �y e d E � ° o a J a � O � � " o N ¢ U N m � N -� VO y O a� o � C � ~ E � N N Q O O V U' C O o� � o O O O O o o O O O o O o O o o O O O o O o O O �(l F I� n 1� t� 1� f� !� n 1� I� 1� I� I� 1� 1� h A t� t� f� 1� f� i� I� CJ CD t9 m O� m W m W fD (D m c0 (O t0 0 LO m fil m(D CD 0 W m fD p t��J M� m m t�'J � m��� M m M m� 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N N W ol m oJ m N t0 W 6J oJ N m W �n c� M c� m cq m m c+� c� m m m c� �? m m m m<n m m �n m c� m w p d N C(�O �( t�0 (�O t�D c�D �� t�0 t�D (�O ��� t (�O ( t�0 t t�D t�O (�O N� t r Z � N N N N N N N N N N N N N N N N N N N N N N N N N N U O N t�J V vl (D I� W Ol O�- N �? tn c0 ^ c9 O� O N t7 a{ � t0 f� c0 O O O O O O O O O O �- � � �.- N N N N N N N N N N O Oi � � � .� � � � � � � � o c m m m m m M m c� m m cn � i+� co i+� m i+� � c'� c� cn ca co c%� M m� m i� Qaw�aaaaaaaaaaaaaaaaaaaaaaaaaaaaa N n � rv rn � � � v � � c3 � � x � � N � O 1- �-�3 I Pro ected Pa -AS-YOU-Go Note fle rt City of St Paul, Minnesota Proposetl Tax Incr<ment (ReEeveiopment) Fnanring Oistrict North Ouatlrant (Sibley Park) Housing Developmen[ Scenario A- Phase One Toial Project (26 years, 8%notej Note Date: 09/Ot/OD Nde Ra[¢: 800% PmounF. 53p5<,300 Semi-Mnual Loan Net CapitaGxed Batance Dale Principal Interest P&I Rev�ue IntereA Ovlstantlin9 (i) (2) (3) (4) (51 (61 R) 0901/Dt 0.00 000 O.CO 0.00 101,8ID.00 OB101101 000 0.00 0.00 0.00 1262a4.a0 02/01/02 0.00 0.00 0.00 O.Op 131,236.18 08�01/02 0.00 20.638.0p 20.638.00 20.638.00 115.90].94 0?J01/03 6.00 20.6300p 20.638.00 20.638.00 120.54b26 OB/Ot/03 23.9089� 146.004.03 169,913.00 169.91300 000 0?1OVO4 23,865.33 145,Od1.6] 169.913.00 169.9t300 0.00 0&Otl04 25,fl59.94 t46.053.OG }{9,913.00 169.913.00 090 02/01/OS 26.896.34 163,01866 169,9130p 169.91300 0.00 O6N1/OS D.9]0.1/ 141.96289 169.913.00 169.91300 000 0?/Ot/O6 29.08892 140.ffi4.08 169.913.W 169.913W O.W 08/Ot/O6 30,25267 139.660.53 169,913.00 169.913_00 0.00 02/01/0] 31,d62.5] 138.dW.d3 169,91300 169.913.00 000 08�01/01 32.)21.0] 13].19L93 169,913.00 169.91300 000 02/Ot/08 34,029.92 135,883.08 169,913.00 169.91300 0.00 OBl6tfOB 35,391 tt 1�a,521.e9 /69.913.00 169.9t3.00 000 02/01/09 36,BW16 133,10624 t69.91300 169.91300 0.00 OB/Ot/09 38,299.03 131.6339] 169.913C0 169.91300 0.00 0?I�1/1Q 39.BIOA9 130.t�281 t69.913.a0 169,9t3.00 OCO 08/Ot/iD a1,a02.60 128.510.40 169,913.00 169.913.00 000 02/01/i1 43,OSB]0 126.854.30 169,913.00 169.913.00 000 OB/Ot/1/ 40,]S1A5 125.13195 169.913.00 169,91300 0.00 01101/12 46.5]2.29 123.3a0�1 169.91300 169.913.00 000 08101/12 A8,a35.18 12t,4T).82 169,913.00 169.913.00 000 02/Ot/13 50.3]2.59 119.54041 169.91300 169.913.00 0.00 OB/Oi/13 52.38Z49 117.52551 169.91300 169.91300 0.00 02/Olft6 56,6g2.99 115.62001 169.913.00 169,913.00 0.00 OB/01Ad 56.662.31 it3250.69 169.913.00 169,913.00 0.00 02/OtAS 58,928.Bt 110.984.19 169.913.00 169,9/3.00 0.00 OB/Ot/15 61,2g$.95 108,62P.�4 169.913,W 169.913.0� 000 02/OVi6 63,]37.40 106J]5.60 169.913.00 169,913.00 0.00 OB/Ot)16 66,286.89 103.626.11 169.913.00 169,913.00 0.00 02/01/t7 fi8.938.3] 100,974.63 169,913.00 169,913.00 0.00 OB/01/t7 ]1,695.90 98,21].f0 1fi9.9/3.00 769,91300 0.00 0?lOi/t8 ]b,563.]d 95,3a926 t69.91300 169,913.00 O.OD Ofl/Ot/18 7/,SC629 92,36671 169,913.00 169,913.00 0.00 02/Oi/19 80,648,id 89,264.86 169,913.90 )69,913.00 0.00 06�01119 B3.B16.09 86.038.93 t69,9/3.00 169.9t3.00 0.00 02/01/20 8].229.03 82,683.97 169,913.00 169,913.00 0.00 OB/01/ZO 90.]18.f9 79,19d.8/ 169,913.00 169.913.00 0.00 �2/Ot(21 94.346.92 ]5.565.08 169.91300 169.913.00 � 0.00 08/01@1 98.120.]9 ]1.79221 169.913.00 169.9/3.00 0.00 02/Ot/22 102.04563 67,86Z3� 169,913.00 169,913.00 0.00 08/OV22 106.12].45 63,785.55 169,913.W 169,913.�0 O.W 02/Ol/23 110,3]2.55 59.540.45 169,913.00 169.913.00 0.00 08�OV23 118,]87.b5 55,125.55 189,81300 1W,913.00 000 02/01/24 119,3]8.95 50,534A5 169,913.00 169,913.00 0.00 0&01/24 124.i54.N 45J58.89 169.913.00 169.9t3.00 0.00 02/01/25 129.12027 6D.]92.]3 169.913.00 I&9.913.00 0.00 OB/Ot/25 734.2&5.08 35.62].92 169.913.00 769.973.00 0.00 02/Ot/26 139,656.49 30256.51 169,913.0� 169,913.00 0.00 OflNt(26 1a5.242.)5 24.87025 169.9t3.00 /69.913.00 0.00 0?JOl/2] 151,052.66 18,H60.56 169,91300 169,913.00 0.00 OH/Ol@7 15].094.55 12,81B65 169,913.00 169.9/3.00 0.00 02lOtl28 163.366.6t 6,534.66 769.90127 159.901.27 0.00 09/Ol/28 0_00 0.00 0.00 0.00 0.00 OY01/29 000 0.00 0.00 0.00 0.00 33.650.107 Sa.886,81&49 58.536.97d.9 58.536.91427 5595.800.]8 Excess Tax Increment 11.]3 TotalNe[Revenue 58,536,926.00 3.054.300.00 3,156,110.00 3,282,354.d0 3,a13,6aB.58 3.529,556.52 3.650,100.]8 3,626,191.81 3.601.326 de 3.575,465.54 3,560,5)220 3,520,602.09 3,49t,513II 3,d61.260 70 3,429,]98.13 3.39].O1J.06 3.363,04].14 3,321,65603 3,290.8692] 3,252,5)024 3.2t2.1f0.05 3.1]y35].45 3,128,298.�5 3,OB3,51 T 90 3.036,9a5.dt 2.988.510.23 2.938,13P.64 Z.B85,�50 15 2.831.261.16 2.]]A,604.85 2.]15,61604 2,654.390 OB 2,590,652.68 2.52a.365.19 2,d55.d21.a2 2,383,731.52 2.309.16].]8 2,231,621.d9 2,150,973.35 2.06].O�J32H 1.9�9.8�a25 1.889,752.06 1.794.805.1< 1.696.68d.35 1.59a,638.]2 1.488.511.21 f.3]8.13&�2 1.263.3512] 1.143.972.32 1.019.81821 890.69].94 ]56.412.86 616,]56.3] d1t,513.62 320.d61.i6 1W.3fi6.61 0.00 O.aO 0 00 Preper¢d py:5pringsletl InmrporateC (pnntetl o� 06/2fl@000 at 322 PM) Lf062Ba.zls Market Value Analysis Report City of St. Paul, Minnesota Proposed Tax Increment (Redevelopment) Financing District North Quadrent (Sibley Park) Housing Deveiopment Scenario A- Phase One Totai Project (26 years, 8%a note) Assumptions Present Value Date P.V. Rate - Gross T.I. Increase in EMV With TIF District Less: P.V of Gross Tax increment Subtotal Less: Increase in EMV Without 71F Difference 1 2 3 4 5 6 7 8 9 70 1i 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 09/Ot/00 8.00% $15,065,�44 3,481,295 $11,584,449 0 $17,584,449 Annual Present GrossTax Va{ue@ Year Increment 8.00%a 2002 45,977 39,166 2003 378,531 298,569 2004 378,531 276,453 2005 378,531 255,975 2006 378,531 237,074 2007 378,531 219,457 2008 378,531 203,201 2009 378,531 188,149 2010 378,531 174,212 2017 378,531 161,308 2012 378,531 149,359 2013 378,53t 135,295 2014 378,531 128,057 2015 378,531 118,566 2076 378,531 109,783 2017 378,531 10�,651 2016 378,531 94,121 2079 378,531 87,149 2020 378,537 80,694 2021 378,531 74,717 2022 378,531 69,782 2023 378,535 64,057 2024 378,53t 59,312 2025 378,531 54,919 2026 378,531 50,851 2027 378,531 47,084 $9,509,252 $3,481,295 00 -�31 Prepared by: Springsted incorporated (06/28/2000} Council File # C� + 7 3, 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 ORIGINAL Presented By Referred To R05olUtiOn # Green Sheet # �D,�n�� BE IT RESOLVED by the City Council of the City of Saint Paul, Minnesota (the "City") as follows: Section 1. Recitals. 1.01 On June 23, 1999, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "Authority") established the North Quadrant Redevelopment Project Area (the "Redevelopment Project Area") and adopted a redevelopment plan therefor (the "Redevelopment Plan��). 1.02 The Authority has asked the City Council to approve the creation, within the Redevelopment Project Area, of Tax Increment Financing District No. 1(North Quadrant) (the "Tax Increment District") and the adoption oE a Tax Increment Financing Plan therefor, all pursuant to and in accordance with Minnesota Statutes, Section 469.174 through 469.179 (the "Tax Increment Act") and Laws of Minnesota 2000, Chapter 490, Article 11, 5ection 40 (the "Special Law"). 1.03 The Authority has performed all actions required by law to be performed prior to the creation of the Tax Increment District and adoption of a Tax Increment Plan therefor, including, but not la.mited to, notificaCion of Ramsey County and Independent School District Number 625, which have taxing jurisdiction over the property to be included in the Tax Increment District, and has requested that the City approve the adoption of the Tax Increment Financing Plan and the creation of the Tax Increment District £ollowing the holding of a public hearing upon published and mailed notice as required by law. 2.01 The City Cpuncil hereby finds that the creation of Tax Increment FinanCing District No. 1(NOrth Quadrant) and adoption of a Tax Increment Plan therefor, are intended and, in the judgment oE the City Counci.l, its effect will be, to carry ouC the objectives of the Redevelopment Plan and to create an impetus for the construction in the City of affordable and mixed income housing, will increase employment and otherwise promote certain public gurposes and accomplish certain objecCives as specified in the Redevelopment Plan and Tax Increment Financing Plan. 1142957.1 ' RESOLUTION APPROVING THE THE CREATION OF TAX INCREMENT FINANCING DISTRICT NO. 1(NORTH QUADRANI'), AND THE ADOPTION OF A TAX INCREMENT FTNANCING PLAN THEREFOR p _�131 1 2 3 4 5 6 7 8 9 10 il 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 2.02 The City Council hereby finds that Tax Increment Financing District No. 1(North Quadrant) qualifies as an "housing district" within the meaning of the Tax Increment Act and the Special Law Por the following reasons: The property to be included in the Tax Increment District is located in the Northeast quadrant of the City, i_e. within the 15 acre site bounded by Interstate 94 on the north and east, Jackson Street on the west and Seventh Street on the south, together with the west side o£ Jackson Street to midblock between Interstate 94 and South Street. 'I}aenty percent of the housing units the Tax Increment District will be occupied by individuals whose family income is equal to or less than 50 percent of area median gross income and an additional 60 percent of the units will be occupied by individuals whose family income is equal to or less than 115 percent of area median gross income. Twenty percent of the units in the Tax Increment District will not be subject to any income limitations. Family income means the median gross income for the City as determined under section 42 of the Internal Revenue Code of 1986, as amended. The income requirements will be satisfied if the sum of qualified owner-occupied units and qualified residential rental units equals the required total number of qualified units. Owner-occupied units will initially be purchased and occupied by individuals whose family inoome satisfies the income requirements. For residential rental property, the income requirements apply for the duration of the Tax InCrement District. The fair market value of the improvements which are constructed in the T� Increment District for commercial uses or for uses other than owner- occupied and rental mixed-income housing will not consist of more than 20 percent of the total fair market value of the planned improvements in the development plan or agreement. The fair market value of the improvements wi11 be determined using the cost of construction, capitalized income, or other appropriate method of estimating market value. 2.03 The City Council hereby makes the following findings: 1192957.1 a � _ 731 1 2 4 5 6 7 8 9 10 il 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 (a) The City Council further finds that the proposed development, in the opinion of the City Council, would not occur solely through private investment within the reasonably foreseeahle future and, Cherefore, the use of tax increment financing is deemed necessazy_ The specific basis for such finding being: The parcels on which the development will occur would not be developed in the reasonably foreseeable future because they are currently used for surface parking, which use generates significant income to the current owner of the property considering the owner�s minimal investment in the property. (b) The City 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 is in accordance with the existing zoning for the property. (c) The City Council further finds that the Tax Tncrement Financing Plan will afford maximum opportunity consistent with the sound needs of the City as a whole for the development of the Tax Increment District by private enterprise. The specific basis for such finding being: The proposed development to occur within the Tax Increment District is housing. The development will increase needed affordable and mixed income housing in the City and will increase the market valuation of the City. (fl) 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 market value estimated to result from the proposed development (i.e., $15,065,744) after Subtracting the present value of the projected tax increments for the maximum duration of the Tax Increment District (i.e., $3,481,295). In making these findings, the City Council has noted that the property has been undeveloped for many years 1192957.1 ORIG4NAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 a � ..'13� 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. 2.04 The provisions of this Section 2 are hereby incor- porated by reference into and made a gart of the Tax Increment Financing Plan. Section 3. Creation of Tax Increment Financing District No. 1(North Ouadrant) and the Tax Increment Financina Plan therefor. 3.01 The creation of Tax Increment Financing District No. 1 (North Quadrant) is hereby approved and the Tax Increment Financing Plan therefor is hereby adopted. 3.02 The sta£f of the City, the staff of the Authority and the City's and Authority's advisors and legal counsel are authorized and directed to proceed with the implementation of the Tax Increment District and the Tax Increment Financing Plan and for this purpose to negotiate, draft, prepare and present to the Board of Commissioners of the Authority for its consideration all further plans, resolutions, documents and contracts necessary £or this purpose. Adopted by Council: Date �O� l Adoption Certified y Council Secretary HY: � �— Approved by Mayor: Date � LB(y�D sy: Reguested by Department of: Plannina & Economic Develonment � By: `�/ t'� Form Approved by City Attorney I �% �� / �, Approved by Mayor for Submission to Council B 1 �`r�"'� DEPARTMENt/OFFICE/COUNCIL: DATE INITIATED GREEN SHEET No.: 101691 PED 7/28/00 0 0-7 3� CONTACI PERSON & PHONE: - INmnLmA'es miTlnunAiE ALLEN CARLSON 6-6616 � y DEPARI'MENT DIR s ct� covxca. M[JSI BE ON COUNCII, AGENDA BY (DATE) �G� 3 CITY ATTORNEY �I CITY CLERK All�iLSY 9, ZOOO FOR FINANCIAL SERV DII2. _ FAIANCIAL S V/ACCTG ROUTING 4 MAYOR (OR ASST.) 1�A�S�A� � PUBLIC HEARING ORDER coc.�nssiox TOTAL # OF S[GNA7'URE PAGES _I (CLIP ALL LOCATIONS FOR SIGNATURE) acriox xEQuESrEV: . Public hearing to approve T� Increment Financing Disfrict No. 1(North Quadrant) RECOMIv]ENDATI013S: Approve (A) or Reject (R) PERSONA[. SERViCE CON7'RAC1S M[7ST ANSWER TI�E FOLLOWRVG QUESTIONS: PLANNING COA9vIISSION 1. Has this personiSrm ever workeA undet a conhact for this depaztmenY? CIB COM��IITTF.E Yes No CIVII. SERVICE COMMISSION 2. Has this person/fum ever been a city employee? Yes No 3. Does this person/fimi possess a skill not noanal7y possessed by any current city employee? Yes No Explain aIl yes answers on separate sheet and attach to green sheet INI17A1'ING PROBLEM, ISS[IE, OPPORT[7N11'Y (WLo, What, When, Where, Why): Creation of t� increment financing and street on block bounded by 7th, 8th Wacouta and Sibley streets will a11ow fmancial assistance to construction of ll4 rental units of which 46 are affordable, 38 for sale town homes and 13,000 sq. ft. of commercial. ADVANTAGES IF APPROVED� This project is part of North Quadrant Redevelopment Plan to create urban village in North Quadrant of downtown St. Paul. DISADVANTAGESIFAPPROVED: DISADVANI'AGES IF NOT APPROVED: Project will not proceed forwazd. TOTAL AAiOUNT OF'fRANSACI'iON: $ COSTlREVENUE BUDGETED: FL7NDING SOURCE: ACTIVTTY NUMBER: FIlVANCL4L INF012MATION: (EXPLAIN) A �„ps��rct� Cerfe� �� ��P�YS2�Sha.ed�KAPLANt.�^%��frm po ��71 Interdepartmental Memorandum CITY OF SAIN'I' PAUL TO: Council President Bostrom Councilmember Benanau Councilmember Blakey Councilmember Coleman Councilmember Harris Councilmember Lantry Councilmember Reiter FROM: Brian Sweeney Allen Cazlson DATE: 7uly 28, 200� RE: PUBLIC FIEARING: RESOLUTION ESTABLISffiNG TAX INCREMENT FINANCING DISTRICT NO.1(NORTH QUADRANT) AND ADOPTING THE RELATED TAX INCREMENT FINANCING PLAN Purpose The purpose of this public hearing is to receive public comment and request the City Council to approve a resolution which establishes TaY Increment Financing District No. 1(North Quadrant) which is bounded by 7`", 8�' , Wacouta and Sibley Streets. Adoption of the Tax Increment District will allow increments to be generated to assist in the fmancing of a proposed 114 multifamily rental building with 13,000 square feet of commercial space and a 38 unit for sale town home development. Twenty-two percent of the rental units will be affordable to households at or below 30% of the azea median income and 18% of the rental units will be affordable to households at or below 50% of the area median income, BackgroundlProposal The North Quadrant Redevelopment Project Area is on the immediate edge of the core of downtown Saint Paul and is generally bounded by Highway I-94, Jackson Street and East 7th Street. The area is currently characterized by underutilized buildings and large surface parking Page 1 of 7 aa���1 lots although there aze positive assets such as the First Baptist Church, St. Mary's Catholic Church, as well as an assortment of smaller viable businesses. In June of 1999, the City Council adopted the North Quadrant Redevelopment Plan wluch set development objec6ves and urban design guidelines for the azea. A major component of the plan was to foster an 3ncrease in the residential population of downtown including increased opporiunities for affordable housing in accordance with the Saint Paul Housing Plan. Sherman and Associates specializes in the design, construction and financing of rental and ownership housing in Minnesota, North and South Dakota and Wisconsin. They have developed over 3,000 of single family and multifamily homes since 1978. The Lander Group is a full service real estate development company known for high quality urban infill housing. On December 22, 1999, the HI2A Boazd approved Resolution 99-12/22-11 granting the Developer tentative developer designation with the task to finalize financing, prepaze plans and negotiate terms and conditions of a development agreement. Proposal The Developer is proposing a two phase project beginning conshuction this fall on Block 31 adjacent to 7th Street. Phase Two would start in the suuuiier of 2001 on block 17. The Developer's proposal(3.0 acres) constitutes approximately ten percent (10%) of the totalland area of the North Quadrant Redevelopment Project Area . The multifamily rental units which would be 4- 5 stories high would be located along 7th Street and Temperance Street. The 76 for-sale town homes would front along the new park on 8th and Sibley Street. Project I construction will include a 114 unit multifamily L-shaped building with 13,000 square feet of commerciaUretail space on the first floor fronting 7th Street and underground parking far entire building. Project I will also include construction of 38 for-sale town homes. Project II will be a mirror image of Project I except that rental component will have no commercial space and 118 units. In order to accommodate Project II, Sibley Street will need to be moved sixty feet to the East to aliow for a similaz size biock as Project I. The cost of moving the Street, estnnated at $253,OOQ, will be funded with the Communities Livability Grant the City was recenUy awarded by the Metropolitan Council. The nronosed unit 20 >, mix and rents for the Project I multi: Studio MktRate 780 32 1 BR 16 2BR 17 � 2BR (Sec 8) 8 � 3 Br (Sec 8) I1 I 1BR 6 I 2 BR Mkt Rate Mkt Rate 30 30 50 50 Page 2 of 7 1,030 1,290 684 925 b16 738 rental buildine is as follows: 550 850 1,100 L,L00 1,300 850 1,100 00 -'1�� 4 3 Br 5� 8i4 1,300 114 Project II will have an almost identical mix of unit types and afford ability. For Project I, 40% of units wili be affordable pursuant to the Housing Action Plan's policy goals. Specifically, 22% (25) of the units will be affordable to households at or below 30% of the azea median income and 18% (21) units wili have rents affordable to households at 50% of the azea median income. The annual income of a two person household at 50% of the area median income is $26,300, whereas, the income for a 4 person household at or below 30% of the area median income is $19,700. The 38 Project I for sale units will range in size from 850 to 2,250 square and sale prices from $119,000 to $345,000, thus being affordable to households between 80% and 140°/a of the azea median income. The higher priced units will be two stories with separate ground floor access. The upper two levels of the complex wiil have single level flats. Appro�mately, 60% of the units will be affordable to households at or below 115% of the area median income. The under ground parking structure will have a total of 143 spaces of which 88 spaces wi11 be devoted to the rental units and 55 spaces will be devoted to the for sale units. Proposed Financial Structure ofthe Project Due to timing and limited City financial resources it is proposed that Project I and Project II be fmanced separately and differently. The proposed means to finance the Project I rental component is as follows: Sources of Fmds Uses of Funds FicstMortgage $7,125,000 LandSales $335,QQ0 Tae Increment Mortgage 1,945,000 Construction 12.008,000 ffi2A HOME Defe[red Mortgage 750,000 Parking Structure 1,600,000 II2A gcant 250,000 Professionffi Fees 451,60� Met Council Defened Mortgage - 500,000 Soft Costs 165,800 Inclusionary MHFA Deferred Mortgage - 70Q000 Construcfion Financing Costs 759,600 Employer Challenge Family Housing Fund Deferred I50,000 Working Capital Reserve 151,400 Mortgage Taac Credit Syndicated Equity 5,200,000 Operating Deficit Reserve 30Q000 Developer Letter of Credit 481,400 Developet Fee 1,30Q000 Total $17,1O1,A00 Total $17,1O1,A00 The $7,125,000 first mortgage loan to be repaid &om pro}ect revenues will be a 221(d}(4) HUD insured note amortized over a 40 yeu term and interest rate of 8.5%. The tax increment mortgage wall also be HUD insured with a amortized 25 year term, interest rate of 8.5% and Page 3 of 7 Oo-��1 secured with a pay-as-you-go tax increment note provided by the City. The pay-as-you-go note only pledges increments from the TIF district and places no obligation or debt upon the City or HRA. The Metropolitan Council, Minnesota Housing Finance Agency and Family Housing Fund have jointly awarded $1,350,000 of defened subordinate mortgage loan proceeds to Project I. Forty percent of Phase One will have an eligible basis to syndicate low income housing tax credits. The Developer will need approximately $522,000 of tax credits, which the City has using the balance of its 2000 allocation and all of its yeaz 2001 allocation. The tax credit will leverage approximately $5.2 million of syndicator equity to Project I covering 30% of the total development cost. U.S. Bank is purchasing the credits at a premium of $0.92 on the dollar. (Normal rate is about $0.81) The premium being paid by U.S. Bank enable the City to successfully receive $700,000 under MHFA's Employer Challenge fund program (part of the $1.35 million contribution). The Developer will be required to fund $481,000 towards a working capital and operating deticit reserve fund, therefore the actually developer fee will be $819,000 which is lower than the $833,000 allowed pursuant to the developer fee resolution adopted by the Board. Despite the substantial financing resources secured so far for the rental building, the project is still $1 million short of being fully funded. Staff is recommending the gap be filled with a $750,000 loan from the federal HOME Program. The loan would be amortized over 30 year with a 3% interest rate. In addition, staff is recommending a$250,000 grant from the HRA Enterprise fund which would help to fulflll the City's local match requirement to use tax increment funds for ProjectI. The proposed financiug for the 38 for sale units of Project I is as follows: Sources of Funds Uses of Funds Snles Proceeds $7,672,000 Acquisition $ll5,000 T�x Increment Funds I,OOQ000 Underground Parking 950,000 MHFA/Met Council 900,000 Site work 150,000 Construction 5,625,000 Holding costs 575,000 ProfessionaVMarketing 671,000 ArchitecUEngineering 236,000 Contingency - 2% 200,000 Profit 1,050,000 Total $9,572,000 Total $9,572,000 The sales price points are based upon the style of units being constructed and estimates from the Page 4 of 7 Od -'�3 � M�eld Matket Study. Its estiruated that sales proceeds will cover approxiinately 80% of the actually cost to construct the town homes. A major cost of Project I is the underground parking shuchue. Basically, the tas increment provided to Project I is paying the cost of the parking. The average per unit cost is $251,894 of which pazking constitutes $25,000 per unit. The average sales price is $201,894, thus leaving a$SQ,OQO gap between sale proceeds and cost. The City's portion to fill the gap is $26,315 per unit wluch is withiu established City policy. The City's financing gap is recommended to be funded enfuely through tas increment funds in which the Developer will sell a note provided by the City to an investor such as Fannie Mae or U.S. Bank. The Developer will be encouraged to increase the sales prices as units aze sold. 5taff has negotiated a 35% participation in the increased base sales price of any unit so1d. Should sales prices increase during Project I, new base sales prices will be established for Project II which will result in a lower tas increment participation on the part of the City. Taa Increment Financing District Due to the high cost of development including land acquisition and fmancing the proposed improvements such as the underground parking for Project I, this project is feasible onip through assistance, in part, from tax increment financing. The district would be bounded by 7�`, 8`�` , Wacouta and Sibley Streets. A copy of the Plan and project azea map is attached as E�ibit A. The 2000 session of the Minnesota Legislature passed and the Governor signed a speciallaw for the Northeast Quadrant that allows the creation of a TIF district for an owner and rental occupied residenfial housing development for mixed income occupancy. Formerly, TIF district regulations either appiied to rental or to ownership exclusively. Under the new law, only for the North Quadrant, 60% of the units in the development must have income less than 115% of the area median income and 2Q% of the units must be occupied by households at or below 50% of the area median income. The balance of the units do not have income restrictions. Under prior eYisting law 95°l0 of the ownership units had to be occupied by households at or below 115% of the area median income. The new law provides much more flexibility in formulating developments and stil] provides a high level of afford ability. Public Purpose Project I meets several of the objectives, strategies and operating principles of the Housing Action Pdan 2000 as follows: 1. Support the production of ownership and rental housing in Saint Paul. Project I`s 152 uniis meet 20% of the goal to provide immediately 750 new housing units in the city. The availability of rental housing, especially affordable rental housing is extremely low. 2. provides a diversity of building and unit types, rental and ownership. 3. Fosters economic integratian for both rentat and ownership units. 4. Subsidizes the provision of low income housing units in new housing developments. 5. Provides quality housing to create an ariracfive neighborhood and links naw development to broader community objectives. Project I promotes "New Urbanism". It combines mixed-use, mixed-income, transportation linkages and employment connections. 6. follows the principles of the Saint Paul on the Mississippi Development Framework. Page 5 of 7 Oo -73� Neighborhood Input The CapitolRiver Council and its North Quadrant Advisory Committee have actively worked with the Developer regazding the design and financing of Project I and II. Findings of Fact to Support Adoption of Tax Increment Financing Bistrict No. 1(North Quadrant) The reasons and faets supporting the findings for adoption of the Tax Increment Financing District I�3o. 1(North Quadrant) pursuant to MN Statutes, Section 469.175, Sub. 3, are as foliows: 1. Finding tTzat the District is a°housing distr-ict. " This Taac Increment District is in the public interest because it will provide needed multifanuly housing Saint Paul of which at least 20% of the units will be affordable to households at or below 50% of the azea median income. In fact the district will pzovide affardable housing of which 40% will be affordable for rental housing and 60% of the ownership units will be affordable pursuant to state definition of affordable ownership housing. 2. Finding that the proposed deveZopment, zn the o�inion of the Council, would not reasonably be expected to occur solely through private investment within the reasonably for�eseeable�istac�-e and tluit the increased market value of the site that coutd reasonably be expected to occur without the use of tc� increment fznancing would be Zess than the increase in the market vatue estimated to result from the proposed development after subtracting the present value of the projected tax inerements for the maxiTnum duratlon of the district permitted by the plan. Due to the high cost of development on the parcels including the cost of land acquisition and financing the proposed improvements, this project is feasible only through assistance, in part, from tax increment financing. A comparative analysis of estimated mazket values both with and without establishment of the Taac Increment Financing District No. 1(North Quadrant) and the use of tas increments has been performed as described above. If all development which is proposed to assist with t� increment were to occur in the proposed Project I, the total increased market value would be up to $15,749,244. It is the Council's finding that no development with a mazket value of greater than $15,744,244 would occur without ta�c increment assistance in this district within 15 years. This finding is based upon evidence from general past eaperience with the high cost of providing public improvements in the general azea of this District. Finding that the Tczz Increment Financing District No. 1(North Quadrant) conforms to Page 6 of 7 a� -�a � the general plan for the development or redevelopmenf of the municipality as a whole. The Establishment of the Tas Increment Financing District No. 1(North Quadrant) for the North Quadrant Development Project Area conforms to the City's Comprehensive Plan and Saint Paul on the Mississippi Development Framewark . 4. Finding thar the Establishment of the Tax Zncrement Financing Dis£rict Na 1(Norih Quadr�ant) far the North Quadrant Redevelopment ProjectArea will afford mazimum opportunity, conszstent with the sound needs of the City as a whole, far the development of the North Quadrant Redevelopment Project. The number of housing units to be developed will increase the housing stock in the City and the State of Minnesota. Recommendation Staff recommends and requests the City Council to consider adoption of the attached resolution which approves and adopts the following: Estabiishment of the Tax Increment Financing District No. 1(North Quadrant); and The T� Increment Financing Plan to finance the Project. Statement of the Council President Being duly authorized by the City Council to conduct this Public Hearing, the hearing is now open. This Public Heazing is calied for the proposed purpose to consider the following: Estabiishment of the Tau Increment Financing Disttict No.l (North Quadrant); and Approval of the TaY Increment Financing Plan. Notice of tnne, place, and purpose of this hearing was published in the Saint Paul Legal Leger on July 27, 2000. The affidavit of the publicafion of the Notice of Public Hearing will be made a part of these proceedings. Is there anyone who wishes to be heard on this item? If not, the Chair will declare this Public Hearing adjourned. Attachments Tax Tncrement Financing District No. 1(North Quadrant) Resolution approving TaY Increment Financing District No. 1(North Quadrant} Page 7 of 7 � 00-'?3� TAX INCREMENT FINANCING PL�1N for the establishment of TAX INCREMENT FINANCING DISTRICT N0. 1(NORTH QUADRADTT) (a housing district) within the NORTH QUADRAI3T REDEVELOPMENT PROJECT AREA HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF SAINT PAUL RAMSEY COUI3TY STATE OF MINNESOTA Adopted: August 9, 2000 This documenC was dra£ted by: SRIGGS AND MORGAN, (MNID) Professional Association 2200 First 23ational Bank Bldg. St. Paul, N3N 55101 (651) 223-6625 1193029.2 00 -73 � TABLE OF CQNTENTS (for reference purposes only) TAX INCREMENT FINANCING P TAN FOR TAX INCREMENT FINANCING DISTRICT N0. 1(NORTH QUADRANT) Pa4e Subsection 1. Subsection 2. Subsection 3. Subsection 4. Subsection 5. Subsection 6 Subsection 7 Subsection 8 Subsection 9. Subsection 10 Subsection 11 Subsection 12 Subsection 13 Subsection 14 Subsection 15 Subsection 16 Subsection 17 Subsection 18 Subsection Subsection Subsection Subsection 19. 20. 21. 22. 8ubsection 23 Subsection 24 Subsection 25 Subsection 26. Subsection 27. Subsection 28. Subsection 29 Forward . . . . . . . . . . . . . . . . . Statutory Authority . . . . . . . . . . . Statement of Objectives _ . . . . . . . . Redevelopment Plan Overview . . . . . • • Parcels to be Included in Tax Increment Einancing District No. 1 . . . . . . . . Parcel in Acquisition . . . . . . . . . . Development Activity in Tax Increment FinanCing District 230. 1 for which Contracts have been Signed . . . . . . . Other Speci£ic Development Expected to Occur within Redevelopment Area .. Estimated Cost of Project . . . . . . Estimated Amount of Bonded Indebtedness Sources of Revenue . . . . . . . . . Estimated Captured Tax Capacity and Estimate of Tax Increment . . . . . Type of Tax Increment Financing District Duration of Tax Increment Financing District . . . • - • • • • • • • • - - Estimated Impact on Other Taxing Jurisdictions . . . . . . . - . • • State Tax Increment Financing Aid ... Modification of Tax Increment Financing District and/or Tax Increment Financing Plan . . . . . . . . . . . . . . . . ModiEications to Tax Increment Financing Aistrict . . . . . . . • • • - • • • • Administrative Expenses . . . . . . . . Limitation of Increment . . . . . . . . Use of Tax Increment . . . . . . . . . Notification of Prior Planned Improvements . . . . . . - . - • • • • Excess Tax Increments . . . • • • • . Requirements for Agreements with the Developer . . . . . . . . . . . . . . . OC.her Limitations on the L3se of Tax Increment . . . . . . . . . . . . . . . County Road Costs . . . . . . . . . . . Assessment Agreements . . . . . . . . . Administration of the Tax IncremenC Einancing District . . . . . . . . . Financial Reporting Requirements . . . . 2 . 3 . 3 . 3 . 3 . 4 . 4 . 4 . 5 � 9 10 10 12 12 13 13 14 is 15 15 15 1183029.2 ao-73� EXHISIT A- Map of Ta�c Sncrement District No. 1 EXHIBIT B- Map of 13orth Quadrant Redevelopment Project Area EXHIBIT C- Projected Tax Increments 1183029.2 00-'131 TAX INCREMENT FINANCII3G PLAN FOR TAX INCREMENT FINA23CING DISTRICT NO. 1(NORTH QUADRANT) Subsection 1. Forward. The Aousing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "HRA"), and iCs staff and consultants have prepared the following information for the establishment of Tax Increment Financing District No. 1 (23orth Quadrant), a housing district (the "Tax Increment District"). The Tax Increment District is located within the North Quadrant Redevelopment Project Area (the "Redevelopment Project Area") established by the HRA pursuant to the North Quadrant Redevelopment Plan adopted by the HRA on June 23, 1999 (the "Redevelopment Plan"). The Redevelopment Plan was approved by the Planning Commission on June 23, 1999. Subsection 2. Statutorv Authoritv. There exist areas within the City of Saint Paul (the "City") where public involvement is necessary to cause devel.opment to occur. To this end, the HRA has certain statutory powers pursuant to special legislation (Laws of Minnesota, Chagter 490, Article 11, Section 40 (the "Special Law"), and Minnesota Statutes, Section 469.174 through 469.179 (the "Tax Increment Financing Act" or "TIF Act"), to assist in financing public costs related to a project. Subsection 3. Statement of Objectives. The Tax Increment Financing District consists of 2 parcels of land and adjacent and internal rights-of-way. A map showing the boundaries of the Tax Increment District is attached as Exhibit A. The Tax Increment Financing District is being created to facilitate a 38 unit owner occupied townhome development and a 114 unit rental apartment facility. The tax increment financing plan is expected to achieve many of the objectives outlined in the Redevelopment Plan for the North Quadrant Redevelopment Project Area. The following are some of the objectives being facilitated by this Tax Increment Financing Plan. A_ Provide Affordable Housina for Saint Paul Residents. The available housing in the downtown area of the city will expand by more than 152 units with the completion of the housing development contemplated by this Tax Increment Financing Plan. B. To Redevelo� Underused Propertv. The Tax Increment District is a site that has been underutilized for many years. The majority of the area comgrising the site has been used for surface parking. New commercial, cultural and recreational investments are jeopardized by lack of development in the downtown area. 25 of the units in the rental portion of the development will be affordable to households at or below 30% of the area median income and 23 units will be 1183029,2 da-�3� affordable to households at or below 50°s of the area median income. 23 of the owner-occupied units will be affordable to households between 8�a and 115% of area median income. In order to protect past investments and encourage new development in the downtown area new housing development needs to be created to encourage additional private investment. C. Expand the Tax Base of the Citv of Saint Paul. St is expected that the taxable markeC value of parcels in the Tax Increment District will increase by approximately $21,280,000. The acCivities contemplated in the Redevelopment Plan and this Tax increment Financing Plan do not preclude the undertaking of other qualified development or redevelopment activities. These activities are anticipated to occur over the life of the Tax Increment District and the Redevelopment Project. Subsection 4. Redevelopment Plan Overview. 2 Property to be Acquired - Selected property located within Tax Increment Financing District or Redevelopment Project Area may be acquired by the HRA. Relocation � if necessary, complete relocation services are available pursuant to Minnesota Statutes, Chapter 117 and other relevant state and federal laws. Upon approval of a developer's plan relating to a development and completion of the necessary legal requirements, the HRA may sell or assist a developer with the cost of selected properties within Tax Increment Financing District or Redevelopment Project Area, or may lease land or facilities to a developer. 4. The HRA may perform or provide for some or all necessary acquisition, construction, relocation, demolition, and required utilities and street work within Tax Increment Financing District No_ 1. Subsection 5. Parcels to be Included in Tax Increment Financina District No. 1. The following parcels located in the City of Saint Paul, Ramsey County, Minnesota: PIN NO. 312922440028 312922440029 ADDRESS 221 7 Street East 440 Sibley Street 1183029.2 2 OO -�31 FURTHER I23FORMATION REGARDING THE IDENTIrICATION OF THE PARCEL TO BE INCLUDED IN TAX INCREMENT FINANCING DISTRICT N0. 1 CAN BE OBTAINED FROM THE EXECUTIVE DIRECTOR OF THE HRA• Subsection 6. Parcel in Accruisition. The IiRA may finance all or a part o£ the cos�s of acquisition of the parcels identified in Section 5 of this Tax Increment Financing Plan. The following are conditions under which properties not designated to be acquired may be acquired at a future date: (1) The ARA may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of the tax increment financing plan; and (2) Such acquisitions wi11 be undertaken only when there is assurance of funding to finance the acquisition and related costs. Subsection 7. Kinanciu L������� �.... _.._ •.----- - — The following contracts have been or will be entered into by the HRA and the gersons named below: No development agreements have been entered into at this time. However, the HRA anticipates entering into a flevelopment agreement with an entity to be formed by George Sherman Associates and the Louder Group (the "Developer") with respect to the development of a 38 unit owner occupied townhome development and a 114 unit rental apartment facility. Subsection 8. Other Soecific Development Exoected to Occur within Redevelooment Area. Although no specific additional developments have identified at this time, the HRA expects that the acquisition and construction of the above housing development will encourage additional development the Redevelopment Project Area. been in SubsecCion 9. Estimated Cost of Proiect. The HRA has determined that it will be necessary to provide assistance for certain public costs of certain housing activities. To facilitate the development of the Tax Increment Financing District, Chis Tax Increment Financing Plan authorizes the use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs and uses of funds associated with Tax Increment Financing District is outlined in the following table: 1183029.2 00 -�31 Uaes of Funds Land Acquisition Site Preparation Parking Interest Costs Administrative Costs TOTAL Rental 335,000 1,600,000 Owner AccLuired 115,000 150,000 950,000 Total $ 450,000 150,000 2,550,000 5,500,000 970.000 $9,625,000 Estimated costs associated with Tax Increment Financing District are subject to change. The cost of a11 activities to be considered for tax increment financing will not exceed, without formal modification, the budget above pursuant to the applicable statutory requirements. Subsection 10. Estimated Amount of Bonded Indebtedness. No bonded indebtedness is anticipated to be issued. The expenditures authorized by this Tax Increment Financing Plan will be paid for on a pay-as-you-go basis. Subsection 11. Sources of Revenue. Land acquisition, demolition, and other costs outlined in Section 9 above under the Estimated Cost of Project will be financed through the annual collection of tax increments as described below. The total cost of the 114 rental apartment facility are estimated to be approximately $17,000,000. The total cost of the 38 unit owner occupied townhome development is estimated to be approximately $9,500,000. The sources of revenue for these costs include a star loan from the City or HRA federal HOME funds, together totaling approximately $1,000,000, grants or loans from the Metropolitan Council of approximately $900,000, and assistance from the Minnesota Housing Financing Agency of approximately $1,300,000. The Developer will contribute equity or obtain private financing for the remaining cost of the housing developments. Subsection 12. Estimated Captured Tax Capacitv and Estimate of Tax Increment. The most recent tax capacity of Tax Increment Financing District is estimated to be $10,577 as of January 2, 1999. The estimated captured tax capacity of Tax Increment Financing District at completion is estimated to be $254,812. The HRA elects to retain all of the captured tax capacity to finance the costs of Tax Increment Financing District No. 1. The 1183029.2 00 -�31 In making this determination the HRA has relied on its own knowledge of the development history of the area and on representations made by the Developer. The HRA and the City have detexmined that the proposed development of the Tax Tncrement DistricC would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the district permitted by the plan. SubseCtion 14. Duration of 7'ax lncremenL r���a��c.:��,u ,��������. The duration of Tax Increment Financing District will be 25 years from the receigt of the first tax increment. The date of receipt of the first tax increment is expected to be July of 2002. Attached as Exhibit C is the projected receipt of tax increments from Tax Increment Financing District. Subsection 15. Estimated Impact on Utner �i�axin �urisa�c- tions. The estimated impaCt of Tax Increment Financing District on the other taxing jurisdictions assumes construction would have oCCUrred without the creation of Tax Increment FinanCing District. If the construction is a result o£ tax inCrement financing, the impact is $0 to other entities. Notwithstanding the fact that the fiscal impact of the other taxing jurisdictions is $0, due to the fact that the construction would not have occurred without Che assistance of the HRA, the following estimated impact of Tax Increment Financing District would be as follows if the "but for" test was not met: iiaaozs.s 6 L m n � � c� A N L C. C m U O O �O � R � ° a L7 � m �" _ � 9 U Z F 0 0 0 0 R � . n m � N U m _� O O , N o � O¢ O O O O Q � J K = 0 � 0 0 0 0 N . c0 rn o� O U 'O N l� � t�D. L � O 2 (0 O f�l h t7 R � L J T Q N 2 1- � N N O m N N 0 a � � � y � y C t Z R 0 5 � £ o F- Z y � a co � C �V O y O C d � > m u � d v N �.� p� fD d d ry x ? 0 C C v � .tl = I m d N m o, c C A O d a Q U Z 'cL O T O R . a! � O. ~ � 9 A A .0 a d T F- S O ..t � m � N a m a c � ~ o ° °' �� rnr T � y .� a V u � s £ C 9 a x � ' d F 0 � p « ' o � N O C � N � y � Z d p� J Uj o' � � W � � � � a 'ti L � � `o � o m � d � N � F Q. m % m rn F% Z m z F W M m P O • m � O � Oi N m N � N ' ' N � cp m � N N N N �[ C � n o � � N � 0 N M � 0 0 0 0 0 c � n m u`�i c� ° v � n � c7 O N � O N m rn �i 1� O 1� � N � � T a � C m � a o � N m � o y se `!' T t0 � � O U ¢ `!� O t- N 0 a `� m U o R x « a m ,�_, �? V � R « � 0 ¢ p � � m ~ R y .� � � O U 0 � m L L 'R � $ a R ¢ tq T > 0 T R L � � (6 (�J V 0 t � .�c « � ~ 3 > , a m � d N m y O o. �. � > c r = - n H y 3 N O d N L m U ¢ 0 N � 9 �p O A N X O N � ~ � � LL r � y � Y F U K O 'O � a � J = � `m .c � 3 2` ui O � N N U U 0 �, d � 'C p_ m ro N m U o. a w Q� x� ci ° ro m�- t`- u X O V m � O F@ 3 � r� Z o m j C 0 O d 9 Z m p o. �' m � E y � ��m m ry ? 5 m m m U m o ti E� U v� U o h o m � c � � = N F- �c6 O C N O Z � R N � � n o m S E a N a N � d� � ., a m � � y m� 7 V U � y Q x 3 m � L `� o D N V C - � 3 3 ¢ v1 r N C C E E d N � r Ul N �O-�3� m ro � o $ � `o 9 � o C P � ^ T � .. >. � O N a u�i N m � a . � u_ m f � a m 0 U � c N W m U � T � V m ro m a c @ !i) V N x � o J c v � N (� 'C O � 11 � � 'z U � � 0 � N U L m C O 9 V C � TS E x d N L F- F- .� v O N W N O m `m O J C n N � n N fl m o. a � -�31 Subsection 17. M odification of Tax lncremenc rinanc�nv District andlor Tax Increment Rinancina Plan. As of August 9, 2000, no modifications to Tax Increment Financing District No. 1 or the Tax Increment Financing Plan therefore have been made. Subsection 18. In accordance with Minnesota Statutes, Section 469. 175, Subd. 4, any: 1. reduction or enl.argement of the geographic area of the Tax Increment Financing District; 2. increase in amount of bonded indebtedness to be incurred, including a determination to capitalize interest on 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; 3. increase in the portion of the captured net tax aapacity to be retained by the HRA; 4. increase in total estimated tax increment expenditures; or 5. designation of additional property to be acquired by the HRA, shall be approved upon the notice and after the discussion, public hearing and findings required for approval of the original plan. The geographic area of District may be reduced, but sha11 not be enlarged after five years following the date of certification of the original net tax capacity by the county auditor. The requirements of this paragraph do not apply if (1) the only modification is elimination of parcel(s) from Tax Increment Financing District and (2)(A) the current net tax capacity of the parcel(s) eliminated from the Tax Increment Financing District equals or exceeds the net tax capacity of those parcel(s) in the Tax Increment Financing District's original net tax capacity or (B) the HRA agrees that, notwithstanding Minnesota Statutes, Section 469. 177, Subd. 1, the original net tax capacity will be reduced by no more than the current net t� capacity of the parcel(s) eliminated from the Tax Increment Financing District. The ARA must notify the County Auditor of any modification that reduces or enlarges the geographic area of the Tax Increment Financing District or the Redevelopment Project Area. Modifications to Tax Increment Financing District in the �orm of a budget modification or an expansion of the boundaries will be recorded in the Tax InCrement Financing Plan. 1183029.2 00 -731 Subsection 19. Administrative Expenses. In accordance with Minnesota Statutes, Section 469.174, Subd. 14, and Minnesota Statutes, SeCtion 469.176, Subd. 3, administrative expenses means all expenditures of the HRA, other than: 1. amounts paid 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; 2. relocation benefits paid to or services provided for persons residing or businesses locaCed in the district; or 3. amounts used to pay interest on, fund a reserve for, os sell at a discount bonds issued pursuant to Minnesota Statutes, Section 469.178. Administrative expenses also include amounts paid for services provided by bond counsel, fiscal consultants, and planning or economic development consultants. Tax increment may be used to pay any authorized and documented administrative expenses for the Tax Increment Financing District up to but not to exceed 10 percent of the total tax increment expenditures authorized by the tax increment financing plan or the total tax increment expenditures, whichever is less. Pursuant to Minne5ota Statutes, Section 469.176, Subd. 4h, tax increments may be used to pay for the county's actual administrative expenses incurred in connection with the Tax Increment Financing District. The county may require payment of triose expenses by February 15 of the year following the year the expenses were incurred. Pursuant to Minnesota Statutes, Section 469. 1.77, Subd. il, the county treasurer shall deduct an amount equal to 0.1 percent of any increment distributed to the HRA and the county treasurer shall pay the amount deducted to the state treasurer for deposit in the state general fund to be appropriated to the State Auditor for the cost of financial reporting of tax increment financing information and the cost of examining and auditing authorities' use of tax increment financing. Subsection 20. Limitation of Increment_ Pursuant to Minnesota Statutes, Section 469. 176, Subd. 1(a), no tax increment shall be paid to the HRA Eor the Tax Increment Financing District after three (3) years from the date of certification of the Original Net Tax Capacity value of the taxable property in the Tax Increment Financing District by the County Auditor unless within the three (3) year period: 1183029.2 1� ao -�3� (a) bonds have been issued pursuant to Minnesota Statutes, Section 469. 178, or in aid of a project pursuant to any other law, except revenue bonds issued pursuant to Minnesota Statutes, Sections 469.152 to 469.165, or (b) the HRA has acquired property within the Tax Increment Financing District, or (c) the HRA has constructed or caused to be constructed public improvements within the Tax Increment Financing District. The tax increment pledged to the payment of bonds and interest thereon may be discharged and may be ternlinated if sufficient funds have been irrevocably deposited in the debt service fund or other escrow account held in trust for all outstanding bonds to provide for the payment of the bonds at maturity or redemption date. Pursuant to Minnesota Statutes, Section 469.176, Subd. 6: if after four years from the date of certification of the original net tax capacity of the tax increment financing district pursuant to Minnesota Statutes, Section 469.177, no demolition, rehabilitation or renovation of property or other site preparation, including qualified improvement of a street adjacent to a parcel but not installation of utility service including sewer or water systems, has been commenced on a parcel located within a tax increment £inancing district by the authority or by the owner of the parcel in accordance with the tax increment financing plan, no additional tax increment may be taken from that parcel and the original net tax capacity of that parcel sha11 be excluded from the original net tax capacity of the tax increment financing district. If the authority or the owner of the parcel subsequently oommences demolition, rehabilitation or renovation or other site preparation on that parcel including qualified improvement of a street adjacent to that parcel, in accordance with the tax increment financing plan, the authority shall certify to the county auditor that the activity has commenced and the county auditor shall certify the net tax capacity thereof as most recently certified by the commissioner of revenue and add it to the original net tax capacity of the tax increment financing district. The county auditor must enforce the provisions of this subdivision. For purposes of this subdivision, qualified improvements of a street are limited to (1) construction or opening of a new street, (2) relocation of a street, and (3) substantial reconstruction or rebuilding of an existing street. 1153029.2 1�- ao - �3� Financing District and found no parcels for which building permits have been issued during the 18 months immediately preceding approval of the Plan by the HRA. Subsection 23. Excess Tax Increments. Pursuant to Minnesota Statutes, Section 469.176, Subd 2, in any year in which the tax increment exceeds the amount necessary to pay the costs authorized by the Plan, including the amount necessary to cancel any tax levy as provided in Minnesota Statutes, Section 475. 61, Subd. 3, the HRA shall use the excess amount to do any o£ the following: 1. prepay any outstanding bonds; 2. discharge the pledge of tax increment therefor; 3. pay into an escrow account dedicated to the payment of such bond; or 4. return the excess to the County Auditor for redistribution to the respective taxing jurisdictions in proportion to their local tax rates. In addition, the HRA may, subjec� to the limitations set forth herein, choose to modify the Plan in order to finance additional public costs in the Tax Increment Financing District or Redevelopment Project Area. Subsection 24. Recruirements for Agreements with the Developer. The HRA will review any proposal for private development to determine its conformance with Che Redevelopment Plan and with applicable municipal ordinances and codes. To facilitate this effort, the following documents may be requested for review and approval: site plan, construction, mechanical, and electrical system drawings, landscaping plan,.grading and storm drainage plan, signage system plan, and any other drawings or narrative cleemed necessary by the City to demonstrate the conformance of the development with city plans and ordinances. The HRA may also use the Agreements to address other issues related to the development. Pursuant to Minnesota Statutes, Section 469.176, Subd. 5, no more than 10 percent, by acreage, of the property to be acquired in the Tax Increment Financing District as set forth in the Plan shall at any time be owned by the HRA as a result of acquisition with the proceeds of bonds issued pursuant to Minnesota Statutes, Section 469. 178, without the HRA having, prior to acquisition in excess of 10 percent of the acreage, concluded an agreement for the development or redevelopment of the property acquired and which provides recourse for the HRA should the development or redevelopment not be completed. 1183029.2 �"3 00-�1� Subsection 25. Other Limitations on the Use of Tax Increment. l. General Limitations. A11 revenue derived from tax increment shall be used in accordance with the Plan. The revenues shall be used to finance, or otherwise pay the capital and administration costs of the Redevelopment Project Area pursuant to the Minnesota Statutes, Sections 469.124 to 469.134; These revenues shall not be used to circumvent existing levy limit law_ No revenues derived from tax increment shall be used for the acquisition, construction, renovation, operation or maintenance of a building to be used primarily and regularly for conducting the business of a municipality, county, school district, or any other local unit of government or the state or federal government, or for a commons area used as a public park, or a facility used for social, recreation or conference purposes. This provision shall not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure. 2. Pooling Limitations. At least 80 percent of tax increments from the Tax Increment Financing District must be expended on activities in the Tax Tncrement Financing District or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities within said district or to pay, or secure payment of, debt service on credit enhanced bonds. Not more than 20 percent of said tax increments may be expended, through a development fund or otherwise, on activities outside of the Tax Increment Financing District except to pay, or secure payment of, debt service on credit enhanced bonds. For purposes of - applying this restriction, all administrative expenses must be treated as if they were solely for activities outside of the Tax Increment Financing District. 3. Five Year Limitation on Commitment of Tax InCrements. Tax increments derived from the Tax Increment Financing District shall be deemed to have satisfied the 80 percent test set forth in paragraph (2) above only if the five year rule set forth in Minnesota Statutes, Section 469. 1763, Subd. 3, has been satisfied; and beginning with the sixCh year following certification of the Tax Increment Financing DisCrict, 80 percent of said tax increments that remain aftier expenditures permitted under said five year rule must be used only to pay previously commitment expenditures or credit 1183029.2 �.� oa-731 enhanced bonds as more fully set forth in Minnesota Statutes, Section 469.1763, Subd. 5. Subsection 26. Count� Road Costs. Pursuant to Minnesota Statutes, Section 469. 175, Subd. la, the county board may require the ARA to pay for all or part of the cost of county road improvements i£, the proposed development to be assisted by tax increment will, in the judgement o£ the county, substantially increase the use of county roads requiring construction of road improvements or other road costs and if the road improvements are not scheduled within the next five years under a capital improvement plan or other county plan. In the opinion of the ARA and consultants, the proposed development outlined in this Plan will have little or no impact upon county roads. If the county elects to use increments to improve county roads, it must notify the HRA within thirty days of receipt of this Plan. Subsection 27. Assessment Agreements. Pursuant to Minnesota Statutes, Section 469. 177, Subd. 8, the FTRA may enter into an agreement in recordable form with the developer of property within the Tax Increment Financing District which establishes a minimum market value of the land and completed improvements for the duration of the Tax Increment Financing District. The assessment agreement shall be presented to the assessor who shall review the plans and specifications for the improvements constructed, review the market value previously assignecl to the land upon which the improvements are to be constructed and, so long as the minimum market value contained in �he assessment agreement appear, in the judgment of the assessor, to be a reasonable estimate, the assessor may certify the minimum market value agreement. Subsection 28. Administration of the Tax Increment Financina District Administration of the Tax Increment Financing DistriCt will be handled by the Executive Director of the HRA. Subsection 29. Financial ReportincZ Req_uirements. The HRA will comply with all reporting requirements of Minnesota Statutes, SeCtion 469.175, Subd. 5, 6 and 6a. 1183029.2 �-5 EXHIBTT A 00 -'1�1 n -�" ��r � � `M L � � � � ._ � � Z � ■ �� f.. � .... 0 �.{. .�. �"� ' � EX�IIBIT B O� -73� � an or s.aa-r rnvc �� �. . Nof�t�Z Q1cc� �: ExxsB=x c Assum tions Re ort City of St. Paut, Minnesota Proposed Tax increment (Redevelopment) Financing District North Quadrant (Sibley Park) Housing Development Scenario A- Phase One Total Project (26 years, 8% note) Type of Tax tncrement Financing District Maximum Duration of TIF District Certification Request Date Decertification Date Base Estimated Market Value Times: First 30 0.00% Excess 0.00% Original Net Tax Capacity (1) �2,683,500 575,749,244 515,749,244 $15,749,244 Assessment/Collection Year Base Estimated Market Value Increase in Estimated Market Value (1) Total Estimated Market Value Times: First Excess Total Net Tax Capacity (1) Base Inflation Factor Locat Tax Capacity Rate Fiscal Disparities Co�trlbution From TIF District Administrative Retainage Percent (maximum = 10%) Pooting Percent City Tax Rate (Only if Local-Effort TIF) Bonds Bonds Dated Firstlnterest Date Underwriters Discount $265,389 2001/2002 2002/2003 2003/2004 2004/2005 00-'13 � $683,500 $683,500 5683,500 $683,500 2,000,000 15,065,744 15,065,744 15,065,744 NA NA NA LGA/HACA Loss: Will Annual Locai Contribution Be Made (Yes or No)? (2) I.S.D #625 Equatized Tax Capacity Aate I.S.D #625 Sales Ratio City Saies Ratio & Taxable Net Tax Capacity Present Value Date & Rate Yes NA NA NA 09/01/00 NA 5.00°/, (1) See "Schedule of Project Values" for calculation of Market Values and Net Tax Capacities. (2) Assumes annual contribution will be made upfront and will not be available for debt service. Prepared by: Springsted Incorporated (printed on 06128l20�0 at 321 PM) SO 0.00% 0.00% Ftedeve4opment 25 years from 7st incremeni 09/07/00 12/Ot/27 (26 Years of Increment) 2000/2001 S683,500 0 0 $10,577 0 0 0 0 0 0 0 0 $41,527 5265,389 $265,389 NA 148.553%, (Payable 2000) 0,0000°10 (NA for Housing) 10.00% 0.00%, NA Note (Pav-As•You-Go) Note Dated 09l05f00 Note Rate 8.00% Tif0628a.xts c N C d U C x � U d N 0 d C 0 � o G p, cp �U O ` C v c v a R {L 0 T .-. p� �p y C C N. � � H U c p, o ?' � O 2 O _ � y � d W N �. � T F- d N a c O y y O � � v d d C A U � � L �aa m F t � N O � a Z c o m a` Oa��31 m 7 0 C Z 0 ¢ ¢ 0 � o j U � O O � O d J G N O V C m m m � F- E � m c m < Z = a c �y e d E � ° o a J a � O � � " o N ¢ U N m � N -� VO y O a� o � C � ~ E � N N Q O O V U' C O o� � o O O O O o o O O O o O o O o o O O O o O o O O �(l F I� n 1� t� 1� f� !� n 1� I� 1� I� I� 1� 1� h A t� t� f� 1� f� i� I� CJ CD t9 m O� m W m W fD (D m c0 (O t0 0 LO m fil m(D CD 0 W m fD p t��J M� m m t�'J � m��� M m M m� 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000 0.00 0.00 0.00 1262a4.a0 02/01/02 0.00 0.00 0.00 O.Op 131,236.18 08�01/02 0.00 20.638.0p 20.638.00 20.638.00 115.90].94 0?J01/03 6.00 20.6300p 20.638.00 20.638.00 120.54b26 OB/Ot/03 23.9089� 146.004.03 169,913.00 169.91300 000 0?1OVO4 23,865.33 145,Od1.6] 169.913.00 169.9t300 0.00 0&Otl04 25,fl59.94 t46.053.OG }{9,913.00 169.913.00 090 02/01/OS 26.896.34 163,01866 169,9130p 169.91300 0.00 O6N1/OS D.9]0.1/ 141.96289 169.913.00 169.91300 000 0?/Ot/O6 29.08892 140.ffi4.08 169.913.W 169.913W O.W 08/Ot/O6 30,25267 139.660.53 169,913.00 169.913_00 0.00 02/01/0] 31,d62.5] 138.dW.d3 169,91300 169.913.00 000 08�01/01 32.)21.0] 13].19L93 169,913.00 169.91300 000 02/Ot/08 34,029.92 135,883.08 169,913.00 169.91300 0.00 OBl6tfOB 35,391 tt 1�a,521.e9 /69.913.00 169.9t3.00 000 02/01/09 36,BW16 133,10624 t69.91300 169.91300 0.00 OB/Ot/09 38,299.03 131.6339] 169.913C0 169.91300 0.00 0?I�1/1Q 39.BIOA9 130.t�281 t69.913.a0 169,9t3.00 OCO 08/Ot/iD a1,a02.60 128.510.40 169,913.00 169.913.00 000 02/01/i1 43,OSB]0 126.854.30 169,913.00 169.913.00 000 OB/Ot/1/ 40,]S1A5 125.13195 169.913.00 169,91300 0.00 01101/12 46.5]2.29 123.3a0�1 169.91300 169.913.00 000 08101/12 A8,a35.18 12t,4T).82 169,913.00 169.913.00 000 02/Ot/13 50.3]2.59 119.54041 169.91300 169.913.00 0.00 OB/Oi/13 52.38Z49 117.52551 169.91300 169.91300 0.00 02/Olft6 56,6g2.99 115.62001 169.913.00 169,913.00 0.00 OB/01Ad 56.662.31 it3250.69 169.913.00 169,913.00 0.00 02/OtAS 58,928.Bt 110.984.19 169.913.00 169,9/3.00 0.00 OB/Ot/15 61,2g$.95 108,62P.�4 169.913,W 169.913.0� 000 02/OVi6 63,]37.40 106J]5.60 169.913.00 169,913.00 0.00 OB/Ot)16 66,286.89 103.626.11 169.913.00 169,913.00 0.00 02/01/t7 fi8.938.3] 100,974.63 169,913.00 169,913.00 0.00 OB/01/t7 ]1,695.90 98,21].f0 1fi9.9/3.00 769,91300 0.00 0?lOi/t8 ]b,563.]d 95,3a926 t69.91300 169,913.00 O.OD Ofl/Ot/18 7/,SC629 92,36671 169,913.00 169,913.00 0.00 02/Oi/19 80,648,id 89,264.86 169,913.90 )69,913.00 0.00 06�01119 B3.B16.09 86.038.93 t69,9/3.00 169.9t3.00 0.00 02/01/20 8].229.03 82,683.97 169,913.00 169,913.00 0.00 OB/01/ZO 90.]18.f9 79,19d.8/ 169,913.00 169.913.00 0.00 �2/Ot(21 94.346.92 ]5.565.08 169.91300 169.913.00 � 0.00 08/01@1 98.120.]9 ]1.79221 169.913.00 169.9/3.00 0.00 02/Ot/22 102.04563 67,86Z3� 169,913.00 169,913.00 0.00 08/OV22 106.12].45 63,785.55 169,913.W 169,913.�0 O.W 02/Ol/23 110,3]2.55 59.540.45 169,913.00 169.913.00 0.00 08�OV23 118,]87.b5 55,125.55 189,81300 1W,913.00 000 02/01/24 119,3]8.95 50,534A5 169,913.00 169,913.00 0.00 0&01/24 124.i54.N 45J58.89 169.913.00 169.9t3.00 0.00 02/01/25 129.12027 6D.]92.]3 169.913.00 I&9.913.00 0.00 OB/Ot/25 734.2&5.08 35.62].92 169.913.00 769.973.00 0.00 02/Ot/26 139,656.49 30256.51 169,913.0� 169,913.00 0.00 OflNt(26 1a5.242.)5 24.87025 169.9t3.00 /69.913.00 0.00 0?JOl/2] 151,052.66 18,H60.56 169,91300 169,913.00 0.00 OH/Ol@7 15].094.55 12,81B65 169,913.00 169.9/3.00 0.00 02lOtl28 163.366.6t 6,534.66 769.90127 159.901.27 0.00 09/Ol/28 0_00 0.00 0.00 0.00 0.00 OY01/29 000 0.00 0.00 0.00 0.00 33.650.107 Sa.886,81&49 58.536.97d.9 58.536.91427 5595.800.]8 Excess Tax Increment 11.]3 TotalNe[Revenue 58,536,926.00 3.054.300.00 3,156,110.00 3,282,354.d0 3,a13,6aB.58 3.529,556.52 3.650,100.]8 3,626,191.81 3.601.326 de 3.575,465.54 3,560,5)220 3,520,602.09 3,49t,513II 3,d61.260 70 3,429,]98.13 3.39].O1J.06 3.363,04].14 3,321,65603 3,290.8692] 3,252,5)024 3.2t2.1f0.05 3.1]y35].45 3,128,298.�5 3,OB3,51 T 90 3.036,9a5.dt 2.988.510.23 2.938,13P.64 Z.B85,�50 15 2.831.261.16 2.]]A,604.85 2.]15,61604 2,654.390 OB 2,590,652.68 2.52a.365.19 2,d55.d21.a2 2,383,731.52 2.309.16].]8 2,231,621.d9 2,150,973.35 2.06].O�J32H 1.9�9.8�a25 1.889,752.06 1.794.805.1< 1.696.68d.35 1.59a,638.]2 1.488.511.21 f.3]8.13&�2 1.263.3512] 1.143.972.32 1.019.81821 890.69].94 ]56.412.86 616,]56.3] d1t,513.62 320.d61.i6 1W.3fi6.61 0.00 O.aO 0 00 Preper¢d py:5pringsletl InmrporateC (pnntetl o� 06/2fl@000 at 322 PM) Lf062Ba.zls Market Value Analysis Report City of St. Paul, Minnesota Proposed Tax Increment (Redevelopment) Financing District North Quadrent (Sibley Park) Housing Deveiopment Scenario A- Phase One Totai Project (26 years, 8%a note) Assumptions Present Value Date P.V. Rate - Gross T.I. Increase in EMV With TIF District Less: P.V of Gross Tax increment Subtotal Less: Increase in EMV Without 71F Difference 1 2 3 4 5 6 7 8 9 70 1i 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 09/Ot/00 8.00% $15,065,�44 3,481,295 $11,584,449 0 $17,584,449 Annual Present GrossTax Va{ue@ Year Increment 8.00%a 2002 45,977 39,166 2003 378,531 298,569 2004 378,531 276,453 2005 378,531 255,975 2006 378,531 237,074 2007 378,531 219,457 2008 378,531 203,201 2009 378,531 188,149 2010 378,531 174,212 2017 378,531 161,308 2012 378,531 149,359 2013 378,53t 135,295 2014 378,531 128,057 2015 378,531 118,566 2076 378,531 109,783 2017 378,531 10�,651 2016 378,531 94,121 2079 378,531 87,149 2020 378,537 80,694 2021 378,531 74,717 2022 378,531 69,782 2023 378,535 64,057 2024 378,53t 59,312 2025 378,531 54,919 2026 378,531 50,851 2027 378,531 47,084 $9,509,252 $3,481,295 00 -�31 Prepared by: Springsted incorporated (06/28/2000} Council File # C� + 7 3, 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 ORIGINAL Presented By Referred To R05olUtiOn # Green Sheet # �D,�n�� BE IT RESOLVED by the City Council of the City of Saint Paul, Minnesota (the "City") as follows: Section 1. Recitals. 1.01 On June 23, 1999, the Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "Authority") established the North Quadrant Redevelopment Project Area (the "Redevelopment Project Area") and adopted a redevelopment plan therefor (the "Redevelopment Plan��). 1.02 The Authority has asked the City Council to approve the creation, within the Redevelopment Project Area, of Tax Increment Financing District No. 1(North Quadrant) (the "Tax Increment District") and the adoption oE a Tax Increment Financing Plan therefor, all pursuant to and in accordance with Minnesota Statutes, Section 469.174 through 469.179 (the "Tax Increment Act") and Laws of Minnesota 2000, Chapter 490, Article 11, 5ection 40 (the "Special Law"). 1.03 The Authority has performed all actions required by law to be performed prior to the creation of the Tax Increment District and adoption of a Tax Increment Plan therefor, including, but not la.mited to, notificaCion of Ramsey County and Independent School District Number 625, which have taxing jurisdiction over the property to be included in the Tax Increment District, and has requested that the City approve the adoption of the Tax Increment Financing Plan and the creation of the Tax Increment District £ollowing the holding of a public hearing upon published and mailed notice as required by law. 2.01 The City Cpuncil hereby finds that the creation of Tax Increment FinanCing District No. 1(NOrth Quadrant) and adoption of a Tax Increment Plan therefor, are intended and, in the judgment oE the City Counci.l, its effect will be, to carry ouC the objectives of the Redevelopment Plan and to create an impetus for the construction in the City of affordable and mixed income housing, will increase employment and otherwise promote certain public gurposes and accomplish certain objecCives as specified in the Redevelopment Plan and Tax Increment Financing Plan. 1142957.1 ' RESOLUTION APPROVING THE THE CREATION OF TAX INCREMENT FINANCING DISTRICT NO. 1(NORTH QUADRANI'), AND THE ADOPTION OF A TAX INCREMENT FTNANCING PLAN THEREFOR p _�131 1 2 3 4 5 6 7 8 9 10 il 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 2.02 The City Council hereby finds that Tax Increment Financing District No. 1(North Quadrant) qualifies as an "housing district" within the meaning of the Tax Increment Act and the Special Law Por the following reasons: The property to be included in the Tax Increment District is located in the Northeast quadrant of the City, i_e. within the 15 acre site bounded by Interstate 94 on the north and east, Jackson Street on the west and Seventh Street on the south, together with the west side o£ Jackson Street to midblock between Interstate 94 and South Street. 'I}aenty percent of the housing units the Tax Increment District will be occupied by individuals whose family income is equal to or less than 50 percent of area median gross income and an additional 60 percent of the units will be occupied by individuals whose family income is equal to or less than 115 percent of area median gross income. Twenty percent of the units in the Tax Increment District will not be subject to any income limitations. Family income means the median gross income for the City as determined under section 42 of the Internal Revenue Code of 1986, as amended. The income requirements will be satisfied if the sum of qualified owner-occupied units and qualified residential rental units equals the required total number of qualified units. Owner-occupied units will initially be purchased and occupied by individuals whose family inoome satisfies the income requirements. For residential rental property, the income requirements apply for the duration of the Tax InCrement District. The fair market value of the improvements which are constructed in the T� Increment District for commercial uses or for uses other than owner- occupied and rental mixed-income housing will not consist of more than 20 percent of the total fair market value of the planned improvements in the development plan or agreement. The fair market value of the improvements wi11 be determined using the cost of construction, capitalized income, or other appropriate method of estimating market value. 2.03 The City Council hereby makes the following findings: 1192957.1 a � _ 731 1 2 4 5 6 7 8 9 10 il 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 (a) The City Council further finds that the proposed development, in the opinion of the City Council, would not occur solely through private investment within the reasonably foreseeahle future and, Cherefore, the use of tax increment financing is deemed necessazy_ The specific basis for such finding being: The parcels on which the development will occur would not be developed in the reasonably foreseeable future because they are currently used for surface parking, which use generates significant income to the current owner of the property considering the owner�s minimal investment in the property. (b) The City 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 is in accordance with the existing zoning for the property. (c) The City Council further finds that the Tax Tncrement Financing Plan will afford maximum opportunity consistent with the sound needs of the City as a whole for the development of the Tax Increment District by private enterprise. The specific basis for such finding being: The proposed development to occur within the Tax Increment District is housing. The development will increase needed affordable and mixed income housing in the City and will increase the market valuation of the City. (fl) 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 market value estimated to result from the proposed development (i.e., $15,065,744) after Subtracting the present value of the projected tax increments for the maximum duration of the Tax Increment District (i.e., $3,481,295). In making these findings, the City Council has noted that the property has been undeveloped for many years 1192957.1 ORIG4NAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 a � ..'13� 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. 2.04 The provisions of this Section 2 are hereby incor- porated by reference into and made a gart of the Tax Increment Financing Plan. Section 3. Creation of Tax Increment Financing District No. 1(North Ouadrant) and the Tax Increment Financina Plan therefor. 3.01 The creation of Tax Increment Financing District No. 1 (North Quadrant) is hereby approved and the Tax Increment Financing Plan therefor is hereby adopted. 3.02 The sta£f of the City, the staff of the Authority and the City's and Authority's advisors and legal counsel are authorized and directed to proceed with the implementation of the Tax Increment District and the Tax Increment Financing Plan and for this purpose to negotiate, draft, prepare and present to the Board of Commissioners of the Authority for its consideration all further plans, resolutions, documents and contracts necessary £or this purpose. Adopted by Council: Date �O� l Adoption Certified y Council Secretary HY: � �— Approved by Mayor: Date � LB(y�D sy: Reguested by Department of: Plannina & Economic Develonment � By: `�/ t'� Form Approved by City Attorney I �% �� / �, Approved by Mayor for Submission to Council B 1 �`r�"'� DEPARTMENt/OFFICE/COUNCIL: DATE INITIATED GREEN SHEET No.: 101691 PED 7/28/00 0 0-7 3� CONTACI PERSON & PHONE: - INmnLmA'es miTlnunAiE ALLEN CARLSON 6-6616 � y DEPARI'MENT DIR s ct� covxca. M[JSI BE ON COUNCII, AGENDA BY (DATE) �G� 3 CITY ATTORNEY �I CITY CLERK All�iLSY 9, ZOOO FOR FINANCIAL SERV DII2. _ FAIANCIAL S V/ACCTG ROUTING 4 MAYOR (OR ASST.) 1�A�S�A� � PUBLIC HEARING ORDER coc.�nssiox TOTAL # OF S[GNA7'URE PAGES _I (CLIP ALL LOCATIONS FOR SIGNATURE) acriox xEQuESrEV: . Public hearing to approve T� Increment Financing Disfrict No. 1(North Quadrant) RECOMIv]ENDATI013S: Approve (A) or Reject (R) PERSONA[. SERViCE CON7'RAC1S M[7ST ANSWER TI�E FOLLOWRVG QUESTIONS: PLANNING COA9vIISSION 1. Has this personiSrm ever workeA undet a conhact for this depaztmenY? CIB COM��IITTF.E Yes No CIVII. SERVICE COMMISSION 2. Has this person/fum ever been a city employee? Yes No 3. Does this person/fimi possess a skill not noanal7y possessed by any current city employee? Yes No Explain aIl yes answers on separate sheet and attach to green sheet INI17A1'ING PROBLEM, ISS[IE, OPPORT[7N11'Y (WLo, What, When, Where, Why): Creation of t� increment financing and street on block bounded by 7th, 8th Wacouta and Sibley streets will a11ow fmancial assistance to construction of ll4 rental units of which 46 are affordable, 38 for sale town homes and 13,000 sq. ft. of commercial. ADVANTAGES IF APPROVED� This project is part of North Quadrant Redevelopment Plan to create urban village in North Quadrant of downtown St. Paul. DISADVANTAGESIFAPPROVED: DISADVANI'AGES IF NOT APPROVED: Project will not proceed forwazd. TOTAL AAiOUNT OF'fRANSACI'iON: $ COSTlREVENUE BUDGETED: FL7NDING SOURCE: ACTIVTTY NUMBER: FIlVANCL4L INF012MATION: (EXPLAIN) A �„ps��rct� Cerfe� �� ��P�YS2�Sha.ed�KAPLANt.�^%��frm po ��71 Interdepartmental Memorandum CITY OF SAIN'I' PAUL TO: Council President Bostrom Councilmember Benanau Councilmember Blakey Councilmember Coleman Councilmember Harris Councilmember Lantry Councilmember Reiter FROM: Brian Sweeney Allen Cazlson DATE: 7uly 28, 200� RE: PUBLIC FIEARING: RESOLUTION ESTABLISffiNG TAX INCREMENT FINANCING DISTRICT NO.1(NORTH QUADRANT) AND ADOPTING THE RELATED TAX INCREMENT FINANCING PLAN Purpose The purpose of this public hearing is to receive public comment and request the City Council to approve a resolution which establishes TaY Increment Financing District No. 1(North Quadrant) which is bounded by 7`", 8�' , Wacouta and Sibley Streets. Adoption of the Tax Increment District will allow increments to be generated to assist in the fmancing of a proposed 114 multifamily rental building with 13,000 square feet of commercial space and a 38 unit for sale town home development. Twenty-two percent of the rental units will be affordable to households at or below 30% of the azea median income and 18% of the rental units will be affordable to households at or below 50% of the area median income, BackgroundlProposal The North Quadrant Redevelopment Project Area is on the immediate edge of the core of downtown Saint Paul and is generally bounded by Highway I-94, Jackson Street and East 7th Street. The area is currently characterized by underutilized buildings and large surface parking Page 1 of 7 aa���1 lots although there aze positive assets such as the First Baptist Church, St. Mary's Catholic Church, as well as an assortment of smaller viable businesses. In June of 1999, the City Council adopted the North Quadrant Redevelopment Plan wluch set development objec6ves and urban design guidelines for the azea. A major component of the plan was to foster an 3ncrease in the residential population of downtown including increased opporiunities for affordable housing in accordance with the Saint Paul Housing Plan. Sherman and Associates specializes in the design, construction and financing of rental and ownership housing in Minnesota, North and South Dakota and Wisconsin. They have developed over 3,000 of single family and multifamily homes since 1978. The Lander Group is a full service real estate development company known for high quality urban infill housing. On December 22, 1999, the HI2A Boazd approved Resolution 99-12/22-11 granting the Developer tentative developer designation with the task to finalize financing, prepaze plans and negotiate terms and conditions of a development agreement. Proposal The Developer is proposing a two phase project beginning conshuction this fall on Block 31 adjacent to 7th Street. Phase Two would start in the suuuiier of 2001 on block 17. The Developer's proposal(3.0 acres) constitutes approximately ten percent (10%) of the totalland area of the North Quadrant Redevelopment Project Area . The multifamily rental units which would be 4- 5 stories high would be located along 7th Street and Temperance Street. The 76 for-sale town homes would front along the new park on 8th and Sibley Street. Project I construction will include a 114 unit multifamily L-shaped building with 13,000 square feet of commerciaUretail space on the first floor fronting 7th Street and underground parking far entire building. Project I will also include construction of 38 for-sale town homes. Project II will be a mirror image of Project I except that rental component will have no commercial space and 118 units. In order to accommodate Project II, Sibley Street will need to be moved sixty feet to the East to aliow for a similaz size biock as Project I. The cost of moving the Street, estnnated at $253,OOQ, will be funded with the Communities Livability Grant the City was recenUy awarded by the Metropolitan Council. The nronosed unit 20 >, mix and rents for the Project I multi: Studio MktRate 780 32 1 BR 16 2BR 17 � 2BR (Sec 8) 8 � 3 Br (Sec 8) I1 I 1BR 6 I 2 BR Mkt Rate Mkt Rate 30 30 50 50 Page 2 of 7 1,030 1,290 684 925 b16 738 rental buildine is as follows: 550 850 1,100 L,L00 1,300 850 1,100 00 -'1�� 4 3 Br 5� 8i4 1,300 114 Project II will have an almost identical mix of unit types and afford ability. For Project I, 40% of units wili be affordable pursuant to the Housing Action Plan's policy goals. Specifically, 22% (25) of the units will be affordable to households at or below 30% of the azea median income and 18% (21) units wili have rents affordable to households at 50% of the azea median income. The annual income of a two person household at 50% of the area median income is $26,300, whereas, the income for a 4 person household at or below 30% of the area median income is $19,700. The 38 Project I for sale units will range in size from 850 to 2,250 square and sale prices from $119,000 to $345,000, thus being affordable to households between 80% and 140°/a of the azea median income. The higher priced units will be two stories with separate ground floor access. The upper two levels of the complex wiil have single level flats. Appro�mately, 60% of the units will be affordable to households at or below 115% of the area median income. The under ground parking structure will have a total of 143 spaces of which 88 spaces wi11 be devoted to the rental units and 55 spaces will be devoted to the for sale units. Proposed Financial Structure ofthe Project Due to timing and limited City financial resources it is proposed that Project I and Project II be fmanced separately and differently. The proposed means to finance the Project I rental component is as follows: Sources of Fmds Uses of Funds FicstMortgage $7,125,000 LandSales $335,QQ0 Tae Increment Mortgage 1,945,000 Construction 12.008,000 ffi2A HOME Defe[red Mortgage 750,000 Parking Structure 1,600,000 II2A gcant 250,000 Professionffi Fees 451,60� Met Council Defened Mortgage - 500,000 Soft Costs 165,800 Inclusionary MHFA Deferred Mortgage - 70Q000 Construcfion Financing Costs 759,600 Employer Challenge Family Housing Fund Deferred I50,000 Working Capital Reserve 151,400 Mortgage Taac Credit Syndicated Equity 5,200,000 Operating Deficit Reserve 30Q000 Developer Letter of Credit 481,400 Developet Fee 1,30Q000 Total $17,1O1,A00 Total $17,1O1,A00 The $7,125,000 first mortgage loan to be repaid &om pro}ect revenues will be a 221(d}(4) HUD insured note amortized over a 40 yeu term and interest rate of 8.5%. The tax increment mortgage wall also be HUD insured with a amortized 25 year term, interest rate of 8.5% and Page 3 of 7 Oo-��1 secured with a pay-as-you-go tax increment note provided by the City. The pay-as-you-go note only pledges increments from the TIF district and places no obligation or debt upon the City or HRA. The Metropolitan Council, Minnesota Housing Finance Agency and Family Housing Fund have jointly awarded $1,350,000 of defened subordinate mortgage loan proceeds to Project I. Forty percent of Phase One will have an eligible basis to syndicate low income housing tax credits. The Developer will need approximately $522,000 of tax credits, which the City has using the balance of its 2000 allocation and all of its yeaz 2001 allocation. The tax credit will leverage approximately $5.2 million of syndicator equity to Project I covering 30% of the total development cost. U.S. Bank is purchasing the credits at a premium of $0.92 on the dollar. (Normal rate is about $0.81) The premium being paid by U.S. Bank enable the City to successfully receive $700,000 under MHFA's Employer Challenge fund program (part of the $1.35 million contribution). The Developer will be required to fund $481,000 towards a working capital and operating deticit reserve fund, therefore the actually developer fee will be $819,000 which is lower than the $833,000 allowed pursuant to the developer fee resolution adopted by the Board. Despite the substantial financing resources secured so far for the rental building, the project is still $1 million short of being fully funded. Staff is recommending the gap be filled with a $750,000 loan from the federal HOME Program. The loan would be amortized over 30 year with a 3% interest rate. In addition, staff is recommending a$250,000 grant from the HRA Enterprise fund which would help to fulflll the City's local match requirement to use tax increment funds for ProjectI. The proposed financiug for the 38 for sale units of Project I is as follows: Sources of Funds Uses of Funds Snles Proceeds $7,672,000 Acquisition $ll5,000 T�x Increment Funds I,OOQ000 Underground Parking 950,000 MHFA/Met Council 900,000 Site work 150,000 Construction 5,625,000 Holding costs 575,000 ProfessionaVMarketing 671,000 ArchitecUEngineering 236,000 Contingency - 2% 200,000 Profit 1,050,000 Total $9,572,000 Total $9,572,000 The sales price points are based upon the style of units being constructed and estimates from the Page 4 of 7 Od -'�3 � M�eld Matket Study. Its estiruated that sales proceeds will cover approxiinately 80% of the actually cost to construct the town homes. A major cost of Project I is the underground parking shuchue. Basically, the tas increment provided to Project I is paying the cost of the parking. The average per unit cost is $251,894 of which pazking constitutes $25,000 per unit. The average sales price is $201,894, thus leaving a$SQ,OQO gap between sale proceeds and cost. The City's portion to fill the gap is $26,315 per unit wluch is withiu established City policy. The City's financing gap is recommended to be funded enfuely through tas increment funds in which the Developer will sell a note provided by the City to an investor such as Fannie Mae or U.S. Bank. The Developer will be encouraged to increase the sales prices as units aze sold. 5taff has negotiated a 35% participation in the increased base sales price of any unit so1d. Should sales prices increase during Project I, new base sales prices will be established for Project II which will result in a lower tas increment participation on the part of the City. Taa Increment Financing District Due to the high cost of development including land acquisition and fmancing the proposed improvements such as the underground parking for Project I, this project is feasible onip through assistance, in part, from tax increment financing. The district would be bounded by 7�`, 8`�` , Wacouta and Sibley Streets. A copy of the Plan and project azea map is attached as E�ibit A. The 2000 session of the Minnesota Legislature passed and the Governor signed a speciallaw for the Northeast Quadrant that allows the creation of a TIF district for an owner and rental occupied residenfial housing development for mixed income occupancy. Formerly, TIF district regulations either appiied to rental or to ownership exclusively. Under the new law, only for the North Quadrant, 60% of the units in the development must have income less than 115% of the area median income and 2Q% of the units must be occupied by households at or below 50% of the area median income. The balance of the units do not have income restrictions. Under prior eYisting law 95°l0 of the ownership units had to be occupied by households at or below 115% of the area median income. The new law provides much more flexibility in formulating developments and stil] provides a high level of afford ability. Public Purpose Project I meets several of the objectives, strategies and operating principles of the Housing Action Pdan 2000 as follows: 1. Support the production of ownership and rental housing in Saint Paul. Project I`s 152 uniis meet 20% of the goal to provide immediately 750 new housing units in the city. The availability of rental housing, especially affordable rental housing is extremely low. 2. provides a diversity of building and unit types, rental and ownership. 3. Fosters economic integratian for both rentat and ownership units. 4. Subsidizes the provision of low income housing units in new housing developments. 5. Provides quality housing to create an ariracfive neighborhood and links naw development to broader community objectives. Project I promotes "New Urbanism". It combines mixed-use, mixed-income, transportation linkages and employment connections. 6. follows the principles of the Saint Paul on the Mississippi Development Framework. Page 5 of 7 Oo -73� Neighborhood Input The CapitolRiver Council and its North Quadrant Advisory Committee have actively worked with the Developer regazding the design and financing of Project I and II. Findings of Fact to Support Adoption of Tax Increment Financing Bistrict No. 1(North Quadrant) The reasons and faets supporting the findings for adoption of the Tax Increment Financing District I�3o. 1(North Quadrant) pursuant to MN Statutes, Section 469.175, Sub. 3, are as foliows: 1. Finding tTzat the District is a°housing distr-ict. " This Taac Increment District is in the public interest because it will provide needed multifanuly housing Saint Paul of which at least 20% of the units will be affordable to households at or below 50% of the azea median income. In fact the district will pzovide affardable housing of which 40% will be affordable for rental housing and 60% of the ownership units will be affordable pursuant to state definition of affordable ownership housing. 2. Finding that the proposed deveZopment, zn the o�inion of the Council, would not reasonably be expected to occur solely through private investment within the reasonably for�eseeable�istac�-e and tluit the increased market value of the site that coutd reasonably be expected to occur without the use of tc� increment fznancing would be Zess than the increase in the market vatue estimated to result from the proposed development after subtracting the present value of the projected tax inerements for the maxiTnum duratlon of the district permitted by the plan. Due to the high cost of development on the parcels including the cost of land acquisition and financing the proposed improvements, this project is feasible only through assistance, in part, from tax increment financing. A comparative analysis of estimated mazket values both with and without establishment of the Taac Increment Financing District No. 1(North Quadrant) and the use of tas increments has been performed as described above. If all development which is proposed to assist with t� increment were to occur in the proposed Project I, the total increased market value would be up to $15,749,244. It is the Council's finding that no development with a mazket value of greater than $15,744,244 would occur without ta�c increment assistance in this district within 15 years. This finding is based upon evidence from general past eaperience with the high cost of providing public improvements in the general azea of this District. Finding that the Tczz Increment Financing District No. 1(North Quadrant) conforms to Page 6 of 7 a� -�a � the general plan for the development or redevelopmenf of the municipality as a whole. The Establishment of the Tas Increment Financing District No. 1(North Quadrant) for the North Quadrant Development Project Area conforms to the City's Comprehensive Plan and Saint Paul on the Mississippi Development Framewark . 4. Finding thar the Establishment of the Tax Zncrement Financing Dis£rict Na 1(Norih Quadr�ant) far the North Quadrant Redevelopment ProjectArea will afford mazimum opportunity, conszstent with the sound needs of the City as a whole, far the development of the North Quadrant Redevelopment Project. The number of housing units to be developed will increase the housing stock in the City and the State of Minnesota. Recommendation Staff recommends and requests the City Council to consider adoption of the attached resolution which approves and adopts the following: Estabiishment of the Tax Increment Financing District No. 1(North Quadrant); and The T� Increment Financing Plan to finance the Project. Statement of the Council President Being duly authorized by the City Council to conduct this Public Hearing, the hearing is now open. This Public Heazing is calied for the proposed purpose to consider the following: Estabiishment of the Tau Increment Financing Disttict No.l (North Quadrant); and Approval of the TaY Increment Financing Plan. Notice of tnne, place, and purpose of this hearing was published in the Saint Paul Legal Leger on July 27, 2000. The affidavit of the publicafion of the Notice of Public Hearing will be made a part of these proceedings. Is there anyone who wishes to be heard on this item? If not, the Chair will declare this Public Hearing adjourned. Attachments Tax Tncrement Financing District No. 1(North Quadrant) Resolution approving TaY Increment Financing District No. 1(North Quadrant} Page 7 of 7 � 00-'?3� TAX INCREMENT FINANCING PL�1N for the establishment of TAX INCREMENT FINANCING DISTRICT N0. 1(NORTH QUADRADTT) (a housing district) within the NORTH QUADRAI3T REDEVELOPMENT PROJECT AREA HOUSING AND REDEVELOPMENT AUTHORITY OF THE CITY OF SAINT PAUL RAMSEY COUI3TY STATE OF MINNESOTA Adopted: August 9, 2000 This documenC was dra£ted by: SRIGGS AND MORGAN, (MNID) Professional Association 2200 First 23ational Bank Bldg. St. Paul, N3N 55101 (651) 223-6625 1193029.2 00 -73 � TABLE OF CQNTENTS (for reference purposes only) TAX INCREMENT FINANCING P TAN FOR TAX INCREMENT FINANCING DISTRICT N0. 1(NORTH QUADRANT) Pa4e Subsection 1. Subsection 2. Subsection 3. Subsection 4. Subsection 5. Subsection 6 Subsection 7 Subsection 8 Subsection 9. Subsection 10 Subsection 11 Subsection 12 Subsection 13 Subsection 14 Subsection 15 Subsection 16 Subsection 17 Subsection 18 Subsection Subsection Subsection Subsection 19. 20. 21. 22. 8ubsection 23 Subsection 24 Subsection 25 Subsection 26. Subsection 27. Subsection 28. Subsection 29 Forward . . . . . . . . . . . . . . . . . Statutory Authority . . . . . . . . . . . Statement of Objectives _ . . . . . . . . Redevelopment Plan Overview . . . . . • • Parcels to be Included in Tax Increment Einancing District No. 1 . . . . . . . . Parcel in Acquisition . . . . . . . . . . Development Activity in Tax Increment FinanCing District 230. 1 for which Contracts have been Signed . . . . . . . Other Speci£ic Development Expected to Occur within Redevelopment Area .. Estimated Cost of Project . . . . . . Estimated Amount of Bonded Indebtedness Sources of Revenue . . . . . . . . . Estimated Captured Tax Capacity and Estimate of Tax Increment . . . . . Type of Tax Increment Financing District Duration of Tax Increment Financing District . . . • - • • • • • • • • - - Estimated Impact on Other Taxing Jurisdictions . . . . . . . - . • • State Tax Increment Financing Aid ... Modification of Tax Increment Financing District and/or Tax Increment Financing Plan . . . . . . . . . . . . . . . . ModiEications to Tax Increment Financing Aistrict . . . . . . . • • • - • • • • Administrative Expenses . . . . . . . . Limitation of Increment . . . . . . . . Use of Tax Increment . . . . . . . . . Notification of Prior Planned Improvements . . . . . . - . - • • • • Excess Tax Increments . . . • • • • . Requirements for Agreements with the Developer . . . . . . . . . . . . . . . OC.her Limitations on the L3se of Tax Increment . . . . . . . . . . . . . . . County Road Costs . . . . . . . . . . . Assessment Agreements . . . . . . . . . Administration of the Tax IncremenC Einancing District . . . . . . . . . Financial Reporting Requirements . . . . 2 . 3 . 3 . 3 . 3 . 4 . 4 . 4 . 5 � 9 10 10 12 12 13 13 14 is 15 15 15 1183029.2 ao-73� EXHISIT A- Map of Ta�c Sncrement District No. 1 EXHIBIT B- Map of 13orth Quadrant Redevelopment Project Area EXHIBIT C- Projected Tax Increments 1183029.2 00-'131 TAX INCREMENT FINANCII3G PLAN FOR TAX INCREMENT FINA23CING DISTRICT NO. 1(NORTH QUADRANT) Subsection 1. Forward. The Aousing and Redevelopment Authority of the City of Saint Paul, Minnesota (the "HRA"), and iCs staff and consultants have prepared the following information for the establishment of Tax Increment Financing District No. 1 (23orth Quadrant), a housing district (the "Tax Increment District"). The Tax Increment District is located within the North Quadrant Redevelopment Project Area (the "Redevelopment Project Area") established by the HRA pursuant to the North Quadrant Redevelopment Plan adopted by the HRA on June 23, 1999 (the "Redevelopment Plan"). The Redevelopment Plan was approved by the Planning Commission on June 23, 1999. Subsection 2. Statutorv Authoritv. There exist areas within the City of Saint Paul (the "City") where public involvement is necessary to cause devel.opment to occur. To this end, the HRA has certain statutory powers pursuant to special legislation (Laws of Minnesota, Chagter 490, Article 11, Section 40 (the "Special Law"), and Minnesota Statutes, Section 469.174 through 469.179 (the "Tax Increment Financing Act" or "TIF Act"), to assist in financing public costs related to a project. Subsection 3. Statement of Objectives. The Tax Increment Financing District consists of 2 parcels of land and adjacent and internal rights-of-way. A map showing the boundaries of the Tax Increment District is attached as Exhibit A. The Tax Increment Financing District is being created to facilitate a 38 unit owner occupied townhome development and a 114 unit rental apartment facility. The tax increment financing plan is expected to achieve many of the objectives outlined in the Redevelopment Plan for the North Quadrant Redevelopment Project Area. The following are some of the objectives being facilitated by this Tax Increment Financing Plan. A_ Provide Affordable Housina for Saint Paul Residents. The available housing in the downtown area of the city will expand by more than 152 units with the completion of the housing development contemplated by this Tax Increment Financing Plan. B. To Redevelo� Underused Propertv. The Tax Increment District is a site that has been underutilized for many years. The majority of the area comgrising the site has been used for surface parking. New commercial, cultural and recreational investments are jeopardized by lack of development in the downtown area. 25 of the units in the rental portion of the development will be affordable to households at or below 30% of the area median income and 23 units will be 1183029,2 da-�3� affordable to households at or below 50°s of the area median income. 23 of the owner-occupied units will be affordable to households between 8�a and 115% of area median income. In order to protect past investments and encourage new development in the downtown area new housing development needs to be created to encourage additional private investment. C. Expand the Tax Base of the Citv of Saint Paul. St is expected that the taxable markeC value of parcels in the Tax Increment District will increase by approximately $21,280,000. The acCivities contemplated in the Redevelopment Plan and this Tax increment Financing Plan do not preclude the undertaking of other qualified development or redevelopment activities. These activities are anticipated to occur over the life of the Tax Increment District and the Redevelopment Project. Subsection 4. Redevelopment Plan Overview. 2 Property to be Acquired - Selected property located within Tax Increment Financing District or Redevelopment Project Area may be acquired by the HRA. Relocation � if necessary, complete relocation services are available pursuant to Minnesota Statutes, Chapter 117 and other relevant state and federal laws. Upon approval of a developer's plan relating to a development and completion of the necessary legal requirements, the HRA may sell or assist a developer with the cost of selected properties within Tax Increment Financing District or Redevelopment Project Area, or may lease land or facilities to a developer. 4. The HRA may perform or provide for some or all necessary acquisition, construction, relocation, demolition, and required utilities and street work within Tax Increment Financing District No_ 1. Subsection 5. Parcels to be Included in Tax Increment Financina District No. 1. The following parcels located in the City of Saint Paul, Ramsey County, Minnesota: PIN NO. 312922440028 312922440029 ADDRESS 221 7 Street East 440 Sibley Street 1183029.2 2 OO -�31 FURTHER I23FORMATION REGARDING THE IDENTIrICATION OF THE PARCEL TO BE INCLUDED IN TAX INCREMENT FINANCING DISTRICT N0. 1 CAN BE OBTAINED FROM THE EXECUTIVE DIRECTOR OF THE HRA• Subsection 6. Parcel in Accruisition. The IiRA may finance all or a part o£ the cos�s of acquisition of the parcels identified in Section 5 of this Tax Increment Financing Plan. The following are conditions under which properties not designated to be acquired may be acquired at a future date: (1) The ARA may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of the tax increment financing plan; and (2) Such acquisitions wi11 be undertaken only when there is assurance of funding to finance the acquisition and related costs. Subsection 7. Kinanciu L������� �.... _.._ •.----- - — The following contracts have been or will be entered into by the HRA and the gersons named below: No development agreements have been entered into at this time. However, the HRA anticipates entering into a flevelopment agreement with an entity to be formed by George Sherman Associates and the Louder Group (the "Developer") with respect to the development of a 38 unit owner occupied townhome development and a 114 unit rental apartment facility. Subsection 8. Other Soecific Development Exoected to Occur within Redevelooment Area. Although no specific additional developments have identified at this time, the HRA expects that the acquisition and construction of the above housing development will encourage additional development the Redevelopment Project Area. been in SubsecCion 9. Estimated Cost of Proiect. The HRA has determined that it will be necessary to provide assistance for certain public costs of certain housing activities. To facilitate the development of the Tax Increment Financing District, Chis Tax Increment Financing Plan authorizes the use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs and uses of funds associated with Tax Increment Financing District is outlined in the following table: 1183029.2 00 -�31 Uaes of Funds Land Acquisition Site Preparation Parking Interest Costs Administrative Costs TOTAL Rental 335,000 1,600,000 Owner AccLuired 115,000 150,000 950,000 Total $ 450,000 150,000 2,550,000 5,500,000 970.000 $9,625,000 Estimated costs associated with Tax Increment Financing District are subject to change. The cost of a11 activities to be considered for tax increment financing will not exceed, without formal modification, the budget above pursuant to the applicable statutory requirements. Subsection 10. Estimated Amount of Bonded Indebtedness. No bonded indebtedness is anticipated to be issued. The expenditures authorized by this Tax Increment Financing Plan will be paid for on a pay-as-you-go basis. Subsection 11. Sources of Revenue. Land acquisition, demolition, and other costs outlined in Section 9 above under the Estimated Cost of Project will be financed through the annual collection of tax increments as described below. The total cost of the 114 rental apartment facility are estimated to be approximately $17,000,000. The total cost of the 38 unit owner occupied townhome development is estimated to be approximately $9,500,000. The sources of revenue for these costs include a star loan from the City or HRA federal HOME funds, together totaling approximately $1,000,000, grants or loans from the Metropolitan Council of approximately $900,000, and assistance from the Minnesota Housing Financing Agency of approximately $1,300,000. The Developer will contribute equity or obtain private financing for the remaining cost of the housing developments. Subsection 12. Estimated Captured Tax Capacitv and Estimate of Tax Increment. The most recent tax capacity of Tax Increment Financing District is estimated to be $10,577 as of January 2, 1999. The estimated captured tax capacity of Tax Increment Financing District at completion is estimated to be $254,812. The HRA elects to retain all of the captured tax capacity to finance the costs of Tax Increment Financing District No. 1. The 1183029.2 00 -�31 In making this determination the HRA has relied on its own knowledge of the development history of the area and on representations made by the Developer. The HRA and the City have detexmined that the proposed development of the Tax Tncrement DistricC would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the district permitted by the plan. SubseCtion 14. Duration of 7'ax lncremenL r���a��c.:��,u ,��������. The duration of Tax Increment Financing District will be 25 years from the receigt of the first tax increment. The date of receipt of the first tax increment is expected to be July of 2002. Attached as Exhibit C is the projected receipt of tax increments from Tax Increment Financing District. Subsection 15. Estimated Impact on Utner �i�axin �urisa�c- tions. The estimated impaCt of Tax Increment Financing District on the other taxing jurisdictions assumes construction would have oCCUrred without the creation of Tax Increment FinanCing District. If the construction is a result o£ tax inCrement financing, the impact is $0 to other entities. Notwithstanding the fact that the fiscal impact of the other taxing jurisdictions is $0, due to the fact that the construction would not have occurred without Che assistance of the HRA, the following estimated impact of Tax Increment Financing District would be as follows if the "but for" test was not met: iiaaozs.s 6 L m n � � c� A N L C. C m U O O �O � R � ° a L7 � m �" _ � 9 U Z F 0 0 0 0 R � . n m � N U m _� O O , N o � O¢ O O O O Q � J K = 0 � 0 0 0 0 N . c0 rn o� O U 'O N l� � t�D. L � O 2 (0 O f�l h t7 R � L J T Q N 2 1- � N N O m N N 0 a � � � y � y C t Z R 0 5 � £ o F- Z y � a co � C �V O y O C d � > m u � d v N �.� p� fD d d ry x ? 0 C C v � .tl = I m d N m o, c C A O d a Q U Z 'cL O T O R . a! � O. ~ � 9 A A .0 a d T F- S O ..t � m � N a m a c � ~ o ° °' �� rnr T � y .� a V u � s £ C 9 a x � ' d F 0 � p « ' o � N O C � N � y � Z d p� J Uj o' � � W � � � � a 'ti L � � `o � o m � d � N � F Q. m % m rn F% Z m z F W M m P O • m � O � Oi N m N � N ' ' N � cp m � N N N N �[ C � n o � � N � 0 N M � 0 0 0 0 0 c � n m u`�i c� ° v � n � c7 O N � O N m rn �i 1� O 1� � N � � T a � C m � a o � N m � o y se `!' T t0 � � O U ¢ `!� O t- N 0 a `� m U o R x « a m ,�_, �? V � R « � 0 ¢ p � � m ~ R y .� � � O U 0 � m L L 'R � $ a R ¢ tq T > 0 T R L � � (6 (�J V 0 t � .�c « � ~ 3 > , a m � d N m y O o. �. � > c r = - n H y 3 N O d N L m U ¢ 0 N � 9 �p O A N X O N � ~ � � LL r � y � Y F U K O 'O � a � J = � `m .c � 3 2` ui O � N N U U 0 �, d � 'C p_ m ro N m U o. a w Q� x� ci ° ro m�- t`- u X O V m � O F@ 3 � r� Z o m j C 0 O d 9 Z m p o. �' m � E y � ��m m ry ? 5 m m m U m o ti E� U v� U o h o m � c � � = N F- �c6 O C N O Z � R N � � n o m S E a N a N � d� � ., a m � � y m� 7 V U � y Q x 3 m � L `� o D N V C - � 3 3 ¢ v1 r N C C E E d N � r Ul N �O-�3� m ro � o $ � `o 9 � o C P � ^ T � .. >. � O N a u�i N m � a . � u_ m f � a m 0 U � c N W m U � T � V m ro m a c @ !i) V N x � o J c v � N (� 'C O � 11 � � 'z U � � 0 � N U L m C O 9 V C � TS E x d N L F- F- .� v O N W N O m `m O J C n N � n N fl m o. a � -�31 Subsection 17. M odification of Tax lncremenc rinanc�nv District andlor Tax Increment Rinancina Plan. As of August 9, 2000, no modifications to Tax Increment Financing District No. 1 or the Tax Increment Financing Plan therefore have been made. Subsection 18. In accordance with Minnesota Statutes, Section 469. 175, Subd. 4, any: 1. reduction or enl.argement of the geographic area of the Tax Increment Financing District; 2. increase in amount of bonded indebtedness to be incurred, including a determination to capitalize interest on 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; 3. increase in the portion of the captured net tax aapacity to be retained by the HRA; 4. increase in total estimated tax increment expenditures; or 5. designation of additional property to be acquired by the HRA, shall be approved upon the notice and after the discussion, public hearing and findings required for approval of the original plan. The geographic area of District may be reduced, but sha11 not be enlarged after five years following the date of certification of the original net tax capacity by the county auditor. The requirements of this paragraph do not apply if (1) the only modification is elimination of parcel(s) from Tax Increment Financing District and (2)(A) the current net tax capacity of the parcel(s) eliminated from the Tax Increment Financing District equals or exceeds the net tax capacity of those parcel(s) in the Tax Increment Financing District's original net tax capacity or (B) the HRA agrees that, notwithstanding Minnesota Statutes, Section 469. 177, Subd. 1, the original net tax capacity will be reduced by no more than the current net t� capacity of the parcel(s) eliminated from the Tax Increment Financing District. The ARA must notify the County Auditor of any modification that reduces or enlarges the geographic area of the Tax Increment Financing District or the Redevelopment Project Area. Modifications to Tax Increment Financing District in the �orm of a budget modification or an expansion of the boundaries will be recorded in the Tax InCrement Financing Plan. 1183029.2 00 -731 Subsection 19. Administrative Expenses. In accordance with Minnesota Statutes, Section 469.174, Subd. 14, and Minnesota Statutes, SeCtion 469.176, Subd. 3, administrative expenses means all expenditures of the HRA, other than: 1. amounts paid 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; 2. relocation benefits paid to or services provided for persons residing or businesses locaCed in the district; or 3. amounts used to pay interest on, fund a reserve for, os sell at a discount bonds issued pursuant to Minnesota Statutes, Section 469.178. Administrative expenses also include amounts paid for services provided by bond counsel, fiscal consultants, and planning or economic development consultants. Tax increment may be used to pay any authorized and documented administrative expenses for the Tax Increment Financing District up to but not to exceed 10 percent of the total tax increment expenditures authorized by the tax increment financing plan or the total tax increment expenditures, whichever is less. Pursuant to Minne5ota Statutes, Section 469.176, Subd. 4h, tax increments may be used to pay for the county's actual administrative expenses incurred in connection with the Tax Increment Financing District. The county may require payment of triose expenses by February 15 of the year following the year the expenses were incurred. Pursuant to Minnesota Statutes, Section 469. 1.77, Subd. il, the county treasurer shall deduct an amount equal to 0.1 percent of any increment distributed to the HRA and the county treasurer shall pay the amount deducted to the state treasurer for deposit in the state general fund to be appropriated to the State Auditor for the cost of financial reporting of tax increment financing information and the cost of examining and auditing authorities' use of tax increment financing. Subsection 20. Limitation of Increment_ Pursuant to Minnesota Statutes, Section 469. 176, Subd. 1(a), no tax increment shall be paid to the HRA Eor the Tax Increment Financing District after three (3) years from the date of certification of the Original Net Tax Capacity value of the taxable property in the Tax Increment Financing District by the County Auditor unless within the three (3) year period: 1183029.2 1� ao -�3� (a) bonds have been issued pursuant to Minnesota Statutes, Section 469. 178, or in aid of a project pursuant to any other law, except revenue bonds issued pursuant to Minnesota Statutes, Sections 469.152 to 469.165, or (b) the HRA has acquired property within the Tax Increment Financing District, or (c) the HRA has constructed or caused to be constructed public improvements within the Tax Increment Financing District. The tax increment pledged to the payment of bonds and interest thereon may be discharged and may be ternlinated if sufficient funds have been irrevocably deposited in the debt service fund or other escrow account held in trust for all outstanding bonds to provide for the payment of the bonds at maturity or redemption date. Pursuant to Minnesota Statutes, Section 469.176, Subd. 6: if after four years from the date of certification of the original net tax capacity of the tax increment financing district pursuant to Minnesota Statutes, Section 469.177, no demolition, rehabilitation or renovation of property or other site preparation, including qualified improvement of a street adjacent to a parcel but not installation of utility service including sewer or water systems, has been commenced on a parcel located within a tax increment £inancing district by the authority or by the owner of the parcel in accordance with the tax increment financing plan, no additional tax increment may be taken from that parcel and the original net tax capacity of that parcel sha11 be excluded from the original net tax capacity of the tax increment financing district. If the authority or the owner of the parcel subsequently oommences demolition, rehabilitation or renovation or other site preparation on that parcel including qualified improvement of a street adjacent to that parcel, in accordance with the tax increment financing plan, the authority shall certify to the county auditor that the activity has commenced and the county auditor shall certify the net tax capacity thereof as most recently certified by the commissioner of revenue and add it to the original net tax capacity of the tax increment financing district. The county auditor must enforce the provisions of this subdivision. For purposes of this subdivision, qualified improvements of a street are limited to (1) construction or opening of a new street, (2) relocation of a street, and (3) substantial reconstruction or rebuilding of an existing street. 1153029.2 1�- ao - �3� Financing District and found no parcels for which building permits have been issued during the 18 months immediately preceding approval of the Plan by the HRA. Subsection 23. Excess Tax Increments. Pursuant to Minnesota Statutes, Section 469.176, Subd 2, in any year in which the tax increment exceeds the amount necessary to pay the costs authorized by the Plan, including the amount necessary to cancel any tax levy as provided in Minnesota Statutes, Section 475. 61, Subd. 3, the HRA shall use the excess amount to do any o£ the following: 1. prepay any outstanding bonds; 2. discharge the pledge of tax increment therefor; 3. pay into an escrow account dedicated to the payment of such bond; or 4. return the excess to the County Auditor for redistribution to the respective taxing jurisdictions in proportion to their local tax rates. In addition, the HRA may, subjec� to the limitations set forth herein, choose to modify the Plan in order to finance additional public costs in the Tax Increment Financing District or Redevelopment Project Area. Subsection 24. Recruirements for Agreements with the Developer. The HRA will review any proposal for private development to determine its conformance with Che Redevelopment Plan and with applicable municipal ordinances and codes. To facilitate this effort, the following documents may be requested for review and approval: site plan, construction, mechanical, and electrical system drawings, landscaping plan,.grading and storm drainage plan, signage system plan, and any other drawings or narrative cleemed necessary by the City to demonstrate the conformance of the development with city plans and ordinances. The HRA may also use the Agreements to address other issues related to the development. Pursuant to Minnesota Statutes, Section 469.176, Subd. 5, no more than 10 percent, by acreage, of the property to be acquired in the Tax Increment Financing District as set forth in the Plan shall at any time be owned by the HRA as a result of acquisition with the proceeds of bonds issued pursuant to Minnesota Statutes, Section 469. 178, without the HRA having, prior to acquisition in excess of 10 percent of the acreage, concluded an agreement for the development or redevelopment of the property acquired and which provides recourse for the HRA should the development or redevelopment not be completed. 1183029.2 �"3 00-�1� Subsection 25. Other Limitations on the Use of Tax Increment. l. General Limitations. A11 revenue derived from tax increment shall be used in accordance with the Plan. The revenues shall be used to finance, or otherwise pay the capital and administration costs of the Redevelopment Project Area pursuant to the Minnesota Statutes, Sections 469.124 to 469.134; These revenues shall not be used to circumvent existing levy limit law_ No revenues derived from tax increment shall be used for the acquisition, construction, renovation, operation or maintenance of a building to be used primarily and regularly for conducting the business of a municipality, county, school district, or any other local unit of government or the state or federal government, or for a commons area used as a public park, or a facility used for social, recreation or conference purposes. This provision shall not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure. 2. Pooling Limitations. At least 80 percent of tax increments from the Tax Increment Financing District must be expended on activities in the Tax Tncrement Financing District or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities within said district or to pay, or secure payment of, debt service on credit enhanced bonds. Not more than 20 percent of said tax increments may be expended, through a development fund or otherwise, on activities outside of the Tax Increment Financing District except to pay, or secure payment of, debt service on credit enhanced bonds. For purposes of - applying this restriction, all administrative expenses must be treated as if they were solely for activities outside of the Tax Increment Financing District. 3. Five Year Limitation on Commitment of Tax InCrements. Tax increments derived from the Tax Increment Financing District shall be deemed to have satisfied the 80 percent test set forth in paragraph (2) above only if the five year rule set forth in Minnesota Statutes, Section 469. 1763, Subd. 3, has been satisfied; and beginning with the sixCh year following certification of the Tax Increment Financing DisCrict, 80 percent of said tax increments that remain aftier expenditures permitted under said five year rule must be used only to pay previously commitment expenditures or credit 1183029.2 �.� oa-731 enhanced bonds as more fully set forth in Minnesota Statutes, Section 469.1763, Subd. 5. Subsection 26. Count� Road Costs. Pursuant to Minnesota Statutes, Section 469. 175, Subd. la, the county board may require the ARA to pay for all or part of the cost of county road improvements i£, the proposed development to be assisted by tax increment will, in the judgement o£ the county, substantially increase the use of county roads requiring construction of road improvements or other road costs and if the road improvements are not scheduled within the next five years under a capital improvement plan or other county plan. In the opinion of the ARA and consultants, the proposed development outlined in this Plan will have little or no impact upon county roads. If the county elects to use increments to improve county roads, it must notify the HRA within thirty days of receipt of this Plan. Subsection 27. Assessment Agreements. Pursuant to Minnesota Statutes, Section 469. 177, Subd. 8, the FTRA may enter into an agreement in recordable form with the developer of property within the Tax Increment Financing District which establishes a minimum market value of the land and completed improvements for the duration of the Tax Increment Financing District. The assessment agreement shall be presented to the assessor who shall review the plans and specifications for the improvements constructed, review the market value previously assignecl to the land upon which the improvements are to be constructed and, so long as the minimum market value contained in �he assessment agreement appear, in the judgment of the assessor, to be a reasonable estimate, the assessor may certify the minimum market value agreement. Subsection 28. Administration of the Tax Increment Financina District Administration of the Tax Increment Financing DistriCt will be handled by the Executive Director of the HRA. Subsection 29. Financial ReportincZ Req_uirements. The HRA will comply with all reporting requirements of Minnesota Statutes, SeCtion 469.175, Subd. 5, 6 and 6a. 1183029.2 �-5 EXHIBTT A 00 -'1�1 n -�" ��r � � `M L � � � � ._ � � Z � ■ �� f.. � .... 0 �.{. .�. �"� ' � EX�IIBIT B O� -73� � an or s.aa-r rnvc �� �. . Nof�t�Z Q1cc� �: ExxsB=x c Assum tions Re ort City of St. Paut, Minnesota Proposed Tax increment (Redevelopment) Financing District North Quadrant (Sibley Park) Housing Development Scenario A- Phase One Total Project (26 years, 8% note) Type of Tax tncrement Financing District Maximum Duration of TIF District Certification Request Date Decertification Date Base Estimated Market Value Times: First 30 0.00% Excess 0.00% Original Net Tax Capacity (1) �2,683,500 575,749,244 515,749,244 $15,749,244 Assessment/Collection Year Base Estimated Market Value Increase in Estimated Market Value (1) Total Estimated Market Value Times: First Excess Total Net Tax Capacity (1) Base Inflation Factor Locat Tax Capacity Rate Fiscal Disparities Co�trlbution From TIF District Administrative Retainage Percent (maximum = 10%) Pooting Percent City Tax Rate (Only if Local-Effort TIF) Bonds Bonds Dated Firstlnterest Date Underwriters Discount $265,389 2001/2002 2002/2003 2003/2004 2004/2005 00-'13 � $683,500 $683,500 5683,500 $683,500 2,000,000 15,065,744 15,065,744 15,065,744 NA NA NA LGA/HACA Loss: Will Annual Locai Contribution Be Made (Yes or No)? (2) I.S.D #625 Equatized Tax Capacity Aate I.S.D #625 Sales Ratio City Saies Ratio & Taxable Net Tax Capacity Present Value Date & Rate Yes NA NA NA 09/01/00 NA 5.00°/, (1) See "Schedule of Project Values" for calculation of Market Values and Net Tax Capacities. (2) Assumes annual contribution will be made upfront and will not be available for debt service. Prepared by: Springsted Incorporated (printed on 06128l20�0 at 321 PM) SO 0.00% 0.00% Ftedeve4opment 25 years from 7st incremeni 09/07/00 12/Ot/27 (26 Years of Increment) 2000/2001 S683,500 0 0 $10,577 0 0 0 0 0 0 0 0 $41,527 5265,389 $265,389 NA 148.553%, (Payable 2000) 0,0000°10 (NA for Housing) 10.00% 0.00%, NA Note (Pav-As•You-Go) Note Dated 09l05f00 Note Rate 8.00% Tif0628a.xts c N C d U C x � U d N 0 d C 0 � o G p, cp �U O ` C v c v a R {L 0 T .-. p� �p y C C N. � � H U c p, o ?' � O 2 O _ � y � d W N �. � T F- d N a c O y y O � � v d d C A U � � L �aa m F t � N O � a Z c o m a` Oa��31 m 7 0 C Z 0 ¢ ¢ 0 � o j U � O O � O d J G N O V C m m m � F- E � m c m < Z = a c �y e d E � ° o a J a � O � � " o N ¢ U N m � N -� VO y O a� o � C � ~ E � N N Q O O V U' C O o� � o O O O O o o O O O o O o O o o O O O o O o O O �(l F I� n 1� t� 1� f� !� n 1� I� 1� I� I� 1� 1� h A t� t� f� 1� f� i� I� CJ CD t9 m O� m W m W fD (D m c0 (O t0 0 LO m fil m(D CD 0 W m fD p t��J M� m m t�'J � m��� M m M m� 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N N W ol m oJ m N t0 W 6J oJ N m W �n c� M c� m cq m m c+� c� m m m c� �? m m m m<n m m �n m c� m w p d N C(�O �( t�0 (�O t�D c�D �� t�0 t�D (�O ��� t (�O ( t�0 t t�D t�O (�O N� t r Z � N N N N N N N N N N N N N N N N N N N N N N N N N N U O N t�J V vl (D I� W Ol O�- N �? tn c0 ^ c9 O� O N t7 a{ � t0 f� c0 O O O O O O O O O O �- � � �.- N N N N N N N N N N O Oi � � � .� � � � � � � � o c m m m m m M m c� m m cn � i+� co i+� m i+� � c'� c� cn ca co c%� M m� m i� Qaw�aaaaaaaaaaaaaaaaaaaaaaaaaaaaa N n � rv rn � � � v � � c3 � � x � � N � O 1- �-�3 I Pro ected Pa -AS-YOU-Go Note fle rt City of St Paul, Minnesota Proposetl Tax Incr<ment (ReEeveiopment) Fnanring Oistrict North Ouatlrant (Sibley Park) Housing Developmen[ Scenario A- Phase One Toial Project (26 years, 8%notej Note Date: 09/Ot/OD Nde Ra[¢: 800% PmounF. 53p5<,300 Semi-Mnual Loan Net CapitaGxed Batance Dale Principal Interest P&I Rev�ue IntereA Ovlstantlin9 (i) (2) (3) (4) (51 (61 R) 0901/Dt 0.00 000 O.CO 0.00 101,8ID.00 OB101101 000 0.00 0.00 0.00 1262a4.a0 02/01/02 0.00 0.00 0.00 O.Op 131,236.18 08�01/02 0.00 20.638.0p 20.638.00 20.638.00 115.90].94 0?J01/03 6.00 20.6300p 20.638.00 20.638.00 120.54b26 OB/Ot/03 23.9089� 146.004.03 169,913.00 169.91300 000 0?1OVO4 23,865.33 145,Od1.6] 169.913.00 169.9t300 0.00 0&Otl04 25,fl59.94 t46.053.OG }{9,913.00 169.913.00 090 02/01/OS 26.896.34 163,01866 169,9130p 169.91300 0.00 O6N1/OS D.9]0.1/ 141.96289 169.913.00 169.91300 000 0?/Ot/O6 29.08892 140.ffi4.08 169.913.W 169.913W O.W 08/Ot/O6 30,25267 139.660.53 169,913.00 169.913_00 0.00 02/01/0] 31,d62.5] 138.dW.d3 169,91300 169.913.00 000 08�01/01 32.)21.0] 13].19L93 169,913.00 169.91300 000 02/Ot/08 34,029.92 135,883.08 169,913.00 169.91300 0.00 OBl6tfOB 35,391 tt 1�a,521.e9 /69.913.00 169.9t3.00 000 02/01/09 36,BW16 133,10624 t69.91300 169.91300 0.00 OB/Ot/09 38,299.03 131.6339] 169.913C0 169.91300 0.00 0?I�1/1Q 39.BIOA9 130.t�281 t69.913.a0 169,9t3.00 OCO 08/Ot/iD a1,a02.60 128.510.40 169,913.00 169.913.00 000 02/01/i1 43,OSB]0 126.854.30 169,913.00 169.913.00 000 OB/Ot/1/ 40,]S1A5 125.13195 169.913.00 169,91300 0.00 01101/12 46.5]2.29 123.3a0�1 169.91300 169.913.00 000 08101/12 A8,a35.18 12t,4T).82 169,913.00 169.913.00 000 02/Ot/13 50.3]2.59 119.54041 169.91300 169.913.00 0.00 OB/Oi/13 52.38Z49 117.52551 169.91300 169.91300 0.00 02/Olft6 56,6g2.99 115.62001 169.913.00 169,913.00 0.00 OB/01Ad 56.662.31 it3250.69 169.913.00 169,913.00 0.00 02/OtAS 58,928.Bt 110.984.19 169.913.00 169,9/3.00 0.00 OB/Ot/15 61,2g$.95 108,62P.�4 169.913,W 169.913.0� 000 02/OVi6 63,]37.40 106J]5.60 169.913.00 169,913.00 0.00 OB/Ot)16 66,286.89 103.626.11 169.913.00 169,913.00 0.00 02/01/t7 fi8.938.3] 100,974.63 169,913.00 169,913.00 0.00 OB/01/t7 ]1,695.90 98,21].f0 1fi9.9/3.00 769,91300 0.00 0?lOi/t8 ]b,563.]d 95,3a926 t69.91300 169,913.00 O.OD Ofl/Ot/18 7/,SC629 92,36671 169,913.00 169,913.00 0.00 02/Oi/19 80,648,id 89,264.86 169,913.90 )69,913.00 0.00 06�01119 B3.B16.09 86.038.93 t69,9/3.00 169.9t3.00 0.00 02/01/20 8].229.03 82,683.97 169,913.00 169,913.00 0.00 OB/01/ZO 90.]18.f9 79,19d.8/ 169,913.00 169.913.00 0.00 �2/Ot(21 94.346.92 ]5.565.08 169.91300 169.913.00 � 0.00 08/01@1 98.120.]9 ]1.79221 169.913.00 169.9/3.00 0.00 02/Ot/22 102.04563 67,86Z3� 169,913.00 169,913.00 0.00 08/OV22 106.12].45 63,785.55 169,913.W 169,913.�0 O.W 02/Ol/23 110,3]2.55 59.540.45 169,913.00 169.913.00 0.00 08�OV23 118,]87.b5 55,125.55 189,81300 1W,913.00 000 02/01/24 119,3]8.95 50,534A5 169,913.00 169,913.00 0.00 0&01/24 124.i54.N 45J58.89 169.913.00 169.9t3.00 0.00 02/01/25 129.12027 6D.]92.]3 169.913.00 I&9.913.00 0.00 OB/Ot/25 734.2&5.08 35.62].92 169.913.00 769.973.00 0.00 02/Ot/26 139,656.49 30256.51 169,913.0� 169,913.00 0.00 OflNt(26 1a5.242.)5 24.87025 169.9t3.00 /69.913.00 0.00 0?JOl/2] 151,052.66 18,H60.56 169,91300 169,913.00 0.00 OH/Ol@7 15].094.55 12,81B65 169,913.00 169.9/3.00 0.00 02lOtl28 163.366.6t 6,534.66 769.90127 159.901.27 0.00 09/Ol/28 0_00 0.00 0.00 0.00 0.00 OY01/29 000 0.00 0.00 0.00 0.00 33.650.107 Sa.886,81&49 58.536.97d.9 58.536.91427 5595.800.]8 Excess Tax Increment 11.]3 TotalNe[Revenue 58,536,926.00 3.054.300.00 3,156,110.00 3,282,354.d0 3,a13,6aB.58 3.529,556.52 3.650,100.]8 3,626,191.81 3.601.326 de 3.575,465.54 3,560,5)220 3,520,602.09 3,49t,513II 3,d61.260 70 3,429,]98.13 3.39].O1J.06 3.363,04].14 3,321,65603 3,290.8692] 3,252,5)024 3.2t2.1f0.05 3.1]y35].45 3,128,298.�5 3,OB3,51 T 90 3.036,9a5.dt 2.988.510.23 2.938,13P.64 Z.B85,�50 15 2.831.261.16 2.]]A,604.85 2.]15,61604 2,654.390 OB 2,590,652.68 2.52a.365.19 2,d55.d21.a2 2,383,731.52 2.309.16].]8 2,231,621.d9 2,150,973.35 2.06].O�J32H 1.9�9.8�a25 1.889,752.06 1.794.805.1< 1.696.68d.35 1.59a,638.]2 1.488.511.21 f.3]8.13&�2 1.263.3512] 1.143.972.32 1.019.81821 890.69].94 ]56.412.86 616,]56.3] d1t,513.62 320.d61.i6 1W.3fi6.61 0.00 O.aO 0 00 Preper¢d py:5pringsletl InmrporateC (pnntetl o� 06/2fl@000 at 322 PM) Lf062Ba.zls Market Value Analysis Report City of St. Paul, Minnesota Proposed Tax Increment (Redevelopment) Financing District North Quadrent (Sibley Park) Housing Deveiopment Scenario A- Phase One Totai Project (26 years, 8%a note) Assumptions Present Value Date P.V. Rate - Gross T.I. Increase in EMV With TIF District Less: P.V of Gross Tax increment Subtotal Less: Increase in EMV Without 71F Difference 1 2 3 4 5 6 7 8 9 70 1i 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 09/Ot/00 8.00% $15,065,�44 3,481,295 $11,584,449 0 $17,584,449 Annual Present GrossTax Va{ue@ Year Increment 8.00%a 2002 45,977 39,166 2003 378,531 298,569 2004 378,531 276,453 2005 378,531 255,975 2006 378,531 237,074 2007 378,531 219,457 2008 378,531 203,201 2009 378,531 188,149 2010 378,531 174,212 2017 378,531 161,308 2012 378,531 149,359 2013 378,53t 135,295 2014 378,531 128,057 2015 378,531 118,566 2076 378,531 109,783 2017 378,531 10�,651 2016 378,531 94,121 2079 378,531 87,149 2020 378,537 80,694 2021 378,531 74,717 2022 378,531 69,782 2023 378,535 64,057 2024 378,53t 59,312 2025 378,531 54,919 2026 378,531 50,851 2027 378,531 47,084 $9,509,252 $3,481,295 00 -�31 Prepared by: Springsted incorporated (06/28/2000}