Loading...
02-6271 CjRIGl�I�jL z 3 4 RESOLUTION s _ CITY OF SAINT PAUL, MINNESOTA 6 7 Presented by 3`1 9 Referred To Committee Date 10 RLSOLIITION ADOPTING THE MODIFICATIONS TO THS IINIVERSITY AVFsN[JE / T.H. 280 TAX INCREMBNT FINANCING PLAN TO CREAT& A HAZARDOIIS SIIBSTANCS SIIBDISTRICT IN THE IINIVERSITY AVENIIE / T.$. 280 TAX INCREMENT FINANCING DISTRICT BE IT RESOLVED by th2 Clty COUnCiI (th2 "COUnCiI" of the City of Shcltt Pdul, Minnesota (the "City"), as follows: WHEREAS on 5eptember 22, 1987, the aort authority of the city of Saint Paul (the "POrt Authority") adopted its Resolution No. 2858, creating the university Avenue / T.H. 280 rax rncrement Financing �istrict (the "oistrict"), and, in connection with the creation of the District, the aort authority Board approved the tax increment financing plan relating thereto (the "Plan"), all pursuant to and in accordance with Minnesota statutes, Sections 469.048 through 460.068, inclusive; and Minnesota 5tatues, Sections 469.174 through 469.179, inclusive; and WHEREAS certain parcels within the �istrict require environmental remediation before such parcels can be developed, and, in an effort to further develop the �istrict, it �s proposed that the a hazardous substance subdistrict be established within the oistrict in accordance with Minnesota Statutes, Section 469.175, Subdivision 7; and WHEREAS Port authority management has previously prepared and submitted a Response Action Plan ("RAP") to the Minnesota Pollution Control Agency (the "MPCA"), as required by Minnesota Statutes, Section 469.174, subdivision 17, and received the necessary approvals from the MPCA for the rtAP in september, 2000; and wNEREAS, Port Authority management has prepared a budget for the cost of removal and remedial action specified in the RaP; and wHEREAS, Port Authority management has transmitted the necessary notices and, following a public hearing held on May 28, 2002, approved a modification to the Plan establishing a hazardous substance subdistrict within the District; and WHEREAS the Port authority has determined that: (a) development or redevelopment described in the Plan is not reasonably expected to occur solely through private investment and tax increment otherwise available, and therefore the hazardous substance subdistrict is deemed necessary; (b) other parcels that are not designated hazardous substance sites are expected to be developed together with a designated hazardous substance site; and (c) the subdistrict is not larger than, and the period of time during which increments are elected to be received is not longer than, that which is necessary in the opinion of the Port Authority to provide for the additional costs due to the designated hazardous substance site; WHEREAS, the Port authority has performed all actions required by law to be performed by it prior to the establishment of the hazardous substance subdistrict, including, but not limited to, notification of Ramsey County and School District No. 625 (both of which have taxing jurisdiction over the property included in the oistrict), and the holding of a public hearing; Council File # O 1. - Ga? Green Sheet # 101341 23143.1. o a. - t.�'1 NOW, THEREFORE, BE IT RESOLVED by the City COUnCiI Of the City of Sdint Pdul d5 fo11oW5: l. The city Council hereby adopts the findings of the Port authority and agrees that: (a) development or redevelopment described in the Plan is not reasonably expected to occur solely through private investment and tax increment otherwise available, and therefore the hazardous substance subdistrict is deemed necessary; <b) other parcels that are not designated hazardous substance sites are expected to be developed together with a designated hazardous substance site; and (c� the subdistrict is not larger than, and the period of time during which increments are elected to be received is not longer than, that which is necessary to provide for the additional costs due to the designated hazardous substance site. 2. The modification to the university avenue/r.H. 280 Tax increment Financing Plan establishing the hazardous substance subdistrict (the "MOdified Plan"), as approved by the Port quthority, is hereby approved and adopted, and shall be placed on file in the office of the Port Authority. 3. Port authority management, along with the Port authority's legal counsel, is hereby authorized to proceed with the implementation of the Modified Plan and for this purpose to negotiate and finalize all further plans, resolutions, documents and contracts necessary for this purpose. 4. Port authority management is hereby authorized to forward a copy of the Modified Plan to the Ramsey County auditor and the Minnesota �epartment of Revenue pursuant to Minnesota Statutes, Section 469.175, subd. 2. Adopted: 7uly 10, 2002 23143.1. n a -�a� eas a s sen enanav � ey i/� os om o eman ✓ ams ✓ an L� ei er L/ � O l Adopted by Council: Date ��, � c, c, Adoption Certified by Council Secretary B Approve By: Requeste By: � 23143.1. Form Approved by City Attornev oi-�a1 St. Paul Porf Authority Ken On July 10, 2002 .- � �} June 4, 2002 TOTA� # OF SlGNA7URE PAGES GREEN SHEET mm.uo.�. No 10� 3�1 inWrror. � u��� u�� ,�n 2 ❑ �,,,,.o�„ ❑ a,.m�c _ ❑rwwr,.��uc�sow. ❑w.we�u.,o Q wwRtw��msmrxrl ❑ {CL1P ALL LOCATIONS FOR SIGNAT � � �roval of the modif'ication of the University Avenue/T.H. 280 Tas Increment Financing to include a Hazardous Substance Sub-District and make the necessary statutory findings elections in connection with the plan and the District. a PLANNING COMMISSION CIB COMMIITEE CIVIL SERVICE COMMISSION Port Authority Board � m� a�M� e�rer w«�a �� a�aaa ro.m� neaanme�n VES NO Has mis ceB�rm e�er been a city empbyee9 res rio Do� this personlfi�m poasecs a sidll r� normalyposaexsetl by airy curreM dty empbyee7 YES NO IS Mie peraonrfirm a farpetetl vendo(! VES NO �lain all vea amaweeis on aeueiate sheet arW attech to areen sheet •ova�of��iisN�o�di��e�d�'l�ax�ricremeri� Financing Plan to create a Hazardous Substance District will assist the redevelopment and remed'aation of the final phase of the ¢ate Office Yndustrial Park. .GES IF APPROVED proposed development will consist,of a 98,000 square foot 1' �.�;�dustrial office/showroom ing, which will maximize job potential with approxima�i�,�� jobs being provided on site. ��� � � �� Private Sector development is not likely to oecur due to the pollution and the high cost of OF TRANSAC710N S COET/REVQIUE BUDfiETED (qRCL6 ONE) 1�� Tax Increcnent Financin�lGrant ��TM o Receipts x+�ocvwM 1900 LandmarkTowers 345 St. Peter Street Saint Paul, Minnesota 55102-1661 P � R T � J 9 G Q s a � x 0 � � b �1 June 4, 2002 ivir. Hninony Scnertier, uirecior Planning & Economic Development Department 1300 City Hall Annex 25 West Fourth Street Saint Paul, Minnesota 55102 Tel: 651-224-5686 Fax: 651-223-5198 Toll Free: 800-328-8417 wwwsppa.com oZ -c.a1 � RE: MODIFICATION OF THE UNIVERSITY AVENUEIT.H. 280 TAX INCREMENT FINANCING PLAN TO INCLUDE A HAZARDOUS SUBSTANCE SUBDISTRICT Dear Mr. �ette tler. ����'-�`"f r' We submit for your review and referral to the office of the Mayor, City Council, and City Attomey's office, details pertaining to the modification of the University AvenuelT.H. 280 Tax Increment Financing Plan to include a Hazardous Substance Subdistrict and the adoption of the Modified Tax Increment Financing Plan. In addition to the staff memorandum, we are attaching a draft copy of the proposed City Council Resolution and a copy of the Modified Tax Increment Financing Plan that was approved by the Port Authority's Board on May 28, 2002. City Council action is requested at its meeting of July 10, 2002. Your expeditious handling of this matter will be appreciatetl. Sincerely, 9 � �f �' �_ Kenneth R.Johnson President /rrd Attachment cc: Mayor Kelly 14649.1. SAINT PAUL PORT AUTHORITY MEMORANDUM TO: Board of Commissioners (Meeting of Tuesday, May. 28, 2002) FROM: Pefer M. Klein ;� Laurie J. Hansen j✓ 7 Kenneth R. Johnso ���� DATE: oz -��� May 22, 2002 SUBJECT: PUBLIC HEARING - UNIVERSITY AVENUE 1 T.H. 280 (WESTGATE) MODIFICATION OF TIF PLAN Resolution No. 3941 ACTION REQUESTED 1. Approval of the modification of the University Avenue(f.H. 280 Tax Increment Financing Plan fo include a Hazardous Substance Sub-District. � � Approval of transmittal of the modifietl University Avenue/T.H. 280 Tax Increment Financing Plan to the City Council with the request for the City Councii to set a public hearing. Authorize the Port Authority to fransmit the modified Tax Increment Plan for review and comment to the School District and Ramsey County. PUBLIC PURPOSE Approval of the Hazardous Substance Sub-district will provide partial funding for: Development of a 98,165 square foot office/showroom. Creation of 225 jobs. Remediation of 2 parcels in Westgate Industrial Park. BUSINESS SUBSIDY Not applicable. BACKGROUND On September 22, 1987, the Board of Commissioners approved the creation of University Avenue/T.H. 280 Tax Incremenf Financing District. The main focus of the tlistrict is to improve the tax base and expand employmenf opportunities. On February 27, 2001, the Board provided preliminary approval for the creation of a HSS Sub-District. CSM Corporafion is in the process of acquiring the Northern Star Company site, which is located in the UniversitylT.H. 280 (Westgate) Tax Increment Financing District. CSM Corporation plans to develop this site as the fnal phase (CSM � of the Westgate O�ce Industrial Park. The proposed development consists of a 98,165 square foot light industrial office/showroom building. zzso�.i. CSM is requesfing the creation of a Hazardous Substance Sub-District. Poilution found at the sife necessitates the creation of the Hazardous Substance Sub-Disfrict to assist in payment of the costs for remediation. PROPOSAL The Port Authority and CSM have developed a financing plan for this project, whicfi contains several different funding sources, including tax increment financing. The original tax increment-financing plan will be modified to reflect the creation of the HSS. This modification is documented in appendices A, B and C to the origina! plan. A copy of the orfginal plan and a draft of the appendices, which are in subsfantially final form a�e attached for your review. A summary of this projecYs sources and uses is included as Appendix C of the financing plan. CSM es6mates that 225 jobs wiil be created by the proposed development. The estimated number of construction jobs for the project is 117. RECOMMENDATION We recommend the approval of the modification of the University Avenue(f.H. 280 (Westgate) Tax Increment Financing Plan and approval of transmittai of the pian to the City of Saint Paul, School District and Ramsey County. /rrd zzsoti. o a-�a'1 Resolution No.3�/ RESOLUTION OF THE PORT AUTHORI'I'Y OF THE CITY OF SAINT PAUL WHEREAS, On September 22, 1987, the Port AuthoritY of the City of Saint Pau1 /the "Port Authority"} adopted its Resolution No. 2858, creating the University Avenua / T.H. 280 Tas Increment Financing Disfrict (the "District"), and, in connection with the crearion of the District, the Port Authority Boazd approved the taY increment fuiancing plan relating thereto, a1I pursuant to and in accorda.nce with Minnesota Statutes, Sections 469.048 through 460.068, inclusive; and Minnesota Statues, Sections 469.174 through 469.179, inclusive; and WHEREAS, the Port Authority has been advised that certain pazcels within the District require environmentai remediafion before such parcels can be developed, and, in an effort to fiuther develop the Disirict, it is proposed that the Port Authority establish a Hazazdous Substance Subdistrict within the District in accordance with Minnesota Statutes, Section 469.175, Subdivision 7; and WI3EREAS, Port Authority management has previously prepared and submitted a Response Action Plan ("RAP") to the Minnesota Pollution Control Agency (the "MPCA"), as required by Minnesota Statutes, Section 469.174, Subdivision 17, and received the necessary approvals from the MPCA for the RAP in September, 2000; and WHEREAS, Port Authority management has prepared a budget for the cost of removal and remedial action specified in the RAP; and WHEREAS, the Port Authority hereby determines that: (a) development or redevelopment described in the Plan is not reasonably expected to occur solely through private investment and tax increment otherwise availabie, and therefore the hazardous substance subdistrict is deemed necessary; (b} other pazceis that are not designated hazardous substance sites are expected to be developed together with a designated hazardous substance site; and (c} the subdistrict is not larger than, and fhe period of time during which increments are elected to be received is not longer than, that which is necessary in the opinion of the Port AuthoriTy to provide for the additional costs due to the designated hazardous substance site; WHEREAS,_the Port Authority has performed atl actions required by law to be performed by it prior to the establishment of the District, including, but not limited to, notification of Ramsey County and School District No. 625 (which have taxing jurisdiction over the properiy included in the District), and the holding of a pubiic hearing; NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the Port Authority of the City of Saint Paul as follows: z2zizstvi l. The modification to the University Avenue/T.H. 280 Taac Incrament Financing Plan esfablishing the hazardous substauce subdistrict (the "Modified Plan") is hereby approved and adopfed, and shall be placed on file in the office of the Port Authority. 2. Port Authority management is hereby authorized to submit the Modified Plan to the City Council for its review and approval. 3. Upon approva't of fne iviodined rian by ihe �i'ry �ouncii, rutt l�uinoriiy management, along with the Port Authority's legal counsel, is hereby authorized to proceed witk the nnplementation of the Modified PIan and for tlus purpose to negotiate and finalize a11 fiuther plans, resolutions, documents and contracts necessary for this purpose. 4. Upon approval of the Modified Plan by the City Council, Port Authority management is hereby authorized to forwazd a copy of the Modified Plan to the Ramsey County Auditor and the Minnesota Deparkment of Revenue pursuant to Minnesota Statutes, Section 469.175, subd. 2. Adopted: Map 28, 2002 ATTF�T: " P Its ecre PORT AUTHORiTY OF TT� CITY OF SAINT PAUL � I � ;`l. � �� .�r.. � �. •`. � znizsi�� 2 o a - �.�'l TAX INCREMENT FiNANCING DISTRICT SEPTEMBER 22, 1987 MINNESOTA STATUTES, SECTIONS 273.71-273.78 FOR iJNNERSITY AVENLIE/T.H. 280 (WESTGATE OFFICE INDUS7'RIAL PARK) 13973.1. Table of Contents A. Introduction — Identification of Need ..................................................................................... 3 B. Statutory Authority and Description of District ...................................................................... 4 C. Statement of Purpose and Objectives ..................................................................................... 4 D. DevelopmentProgram ............................................................................................................7 E. Description of Tax Increment District Property ................................................................•.--- 9 F. Development Activities Under Contract ............................................................................... 10 G. Expected Development Activities ......................................................................................... 11 H. �i�.ssiiiciauons of Tax incremei�i riiiancing Disuici ........................................................... i i I. Property in Acquisition ................................................................................................•--...... 11 J . Estimates of Costs ................................................................................................................. 12 K. Identification of the Use of Tax Increments ......................................................................... 12 L. Limitation on Administrative Expenses ................................................................................ 13 M. Souces ofRevenue to Fircance Pubtic Cost .......................................................................... 13 N. Duration of the District ..........................................................................••-�-----...................... 14 O. Impact on Other Tasing 7urisdictions ................................................................................... 14 P. Modifications ........................................................................................................................ 15 Q. Limitation on Duration of Ta�c Zncrement Financing Districts ............................................. 16 R. Limitation on Qualification of Properiy in Tax Increment District Not Subj ect to Improvement .................................................................................................................. .. • --.. 16 S. Annual Disclosure Requirements ......................................................................................... 17 T. Requirement for Agreements with Developer ...................................................................... 17 U. Assessment Agreexnent ......................................................................................................... 18 V. NotificationofPriorPlannedImprovements ........................................................................18 W. Administration of the Tas Increment Economic Development Dislrict ............................... 18 X. Tax Increment Financing Accounts ...................................................................................... 18 Y. Estimate of Amount of Bonds Indebtedness ......................................................................... 18 Appendix A- Amendment to Create Hazardous Substance Sub-District Appendix B- Hazardous Substance Sub-District Parcel List and Site Map Appendix C- Sources and Uses for the Hazardous Substance Sub-District 13973.1. Tax Increment Financing Plan � a' ��'�' A. Introduction — Identification of Need The Board of the Housing and Redevelopment Authority of Saint Paul and the Council of the City of Saint Paul (the "City") and the Port Authority of the City of Saint Paul have determined that a need exists to establish a tax increment financing district within the boundaries of the University Avenue/T.H. 280 Redevelopment Area, in which are Iocated various aging distribution warehouses and railroad spur tracks. The District is bounded �enerally by Trunk Highway 280 (T.H. 280) on the east, the Burlington Nort'tzem Kaiiroad inainiuie u�acks on fne nortn, Tne �aint Paui-iViinneapoiis municipai boundary and Berry Street on the west, and by University Avenue, with the addition of a triangular piece at Ellis Avenue and Curfew Street, on the south. Specific boundaries are outlined in Appendix 1, attached hereto and made a part thereof. The tas parcels included in the Tas Increment Financing District are described by property identification number and address in Section E of this plan. The area included in the District coiisists of approximately 62 acres occupied primarily by aging distribution warehouses aud railroad spur tracks. There are eight single-family houses along the eastern edge of the area separated from the South Saint Anthony neighborhood by T.H. 280. It is obvious that the area, which has superb traffic access, is not being used to its full potential. Most of ;the buildings are in very poor condarion, there are sevaral vacant structures, approximately one-third of the site is underdeveloped, and the number of jobs and the assessed values of the properties are relatively low. The resulting image conveys a sense of blight and probably discourages private reinvestment. The DistricYs excellent access is a result of the proximity to the interchange of T.H. 280 and I-94 and its service by University Avenue and Territorial Road. Public financial assistance is necessary to accompiish the objectives of the University Avenue-T.H. 280 Redevelopment Plan. It is highly unlikely that the private market would even be willing to take the risks inherent in buying and redeveloping the great amount of property invo]ved. Private redevelopment would more likely be piecemeal, uncoordinated, and unable to assemble enough land, resulting in a less than satisfactory result in this pivotal location.' There has been very little or not private interest shown in redevelopment of the District in many years; property conditions have become steadily worse over time. Additionally, many of the present street surfaces need to be reconstructed in order to alleviate structural deficiencies, provide curb and gutter, and to repair flie damage that would be created by the replacement of the sanitazy sewer and water lines. These utilities, which exisf throughout much of the District, need to be upgraded in order to meet contemporary industrial needs. In short, a successful industrial rebirth far the area requires a comprehensive solution rather than perpetuating undesirable conditions that were created mairy years ago. 73973.1 B. Sfatutory Authority azid Description of Disirict The Saint Paul Housing and Redevelopment Authozity is authorized to create a tax increment financing dishict pursuant to Miimesota Statutes, Sections 273.71-283.78. The tas ittcrement disirict will be a redevelopment district, as defined in Section 273.73, subdivision 10, of the Minnesota Tas Increment Financing Act, and will be established in conjunction with the Redevelopment Plan for the University Avenue/T.H. 280 Disfrict. Furthermore, the Port Authority of the City of Saint Paul and the Housing and Redevelopment Aufllority oi ihe Ciiy oi �aini Pau1 area estaolisning a Redeveiopmeni rroject wnicn quatifies as a Redeveiopmen4 Project and as blighted and deteriorated areas under the Aousing and Redevelopment Act, Section 462.421(13) and as an Industrial Development District under Minnesota Statutes 458.191. The purpose of these plans and project is to develop or redevelop sites, lands, or areas within the project area in conformance with the requirements of the above statutes and with the City of Saint Paul's Comprehensive PIan particularly the Land Use, Economic Development Strategy, and District 12 Dishict Plan sections and to implement recommendations of studies completed in order to implement the City's Comprehensive Plan. Specific boundaries of the District are outlined in Appendix l, attached hereto and made a part thereof. C. Statement of Ptupose and Objectives The FIR A/Port Authority will use tax increments anc3 groceeds of tax increment notes/bonds payabie therefrom to pay public costs of redevelopment associated with the University Avenue/T.H. 280 Redevelopment Project, as identified in the University AvenuelT.H. 280 Redevelopment Plan, which pian further set forth the objectives of the I3RA/Port Authority for improvement of the Project and the Project Area. Tke HRA/Port Authority has determined that a need exists to tuidertake a redevelopment effort in the Project Area, which effort shall inciude acquuing and assembling land, demolislung certain economically obsolete structures, improving soil quality, and extending and improving streets and utilities to provide attracrive developmettt sites for locally-based firms and to encourage companies from outside the City to relocate in Saint Paul. These efforts will improve the tax base and expand employment opportmiities. The purpose of the University Avenue/T.H. 280 Tax Increment Financing Plan is to implement the RedeveIopment PIan and fhe following goais and objectives oftfie Comprehensive PIan ofthe City of Saint Paul, including the Land Use Plan, Economic Development Strategy, and the District 12 Plan I983 sections; and additional objectives in order to nnplement fhese Plan policies: Land Use Plan "The City will continue to work with private developers and the Saint Paul Port Authority to facilitate the maintenance and creation of energy-efficient industrial pazks." "The City will develop and maintain an inventory of vacant sites and facilifies suitable for industrial use to meet a variety of indushial needs." 13973.7 oZ-�� "To maximize empioyment opportunities and land utilizarion in Saint PauI, labor-intensive industries— with high jobs per acre rations—should be encouraged to 2ocate or stay in the City." "The City will investigate zonin� provisions and fiscal and non-fiscal incentives which can be used to encourage labor-intensive industry to locate in the City." The Land Use Plan designates the University Avenue/T.H. 280 Redevelopment Area for redevelopment for labor-intensive development. Economic Development Strate¢v: "Saint Paul shall continue to provide assistance towards industrial and commercial development, within a set of guidelines designed to ensure the most efficient use of the City's available land and development resources." "Saint Paul shall increase the supply of land available for coxnmerciallindustrial expansion and development, focusing attention on specific parcel sizes and types required. The City, through the Port Authority, shall continue its policy of acquiring land for industrial purposes, where that land is not better suited for other purposes. Examples include vacant or under-utilized railroad lands, or other parcels that are sufficienYly removed from residenfial or comxnercial lands so as to not adversely affect them." "Saint Paul shall pursue institutionai policies and changes designed to improve its role as a facilitator or commercial and industria] expansion and development" District 12 Plan 1983: "The District 12 Community Cotmcil should encourage private image improvement on a property-by- property basis along University Avenue. Problems which need to be treated include poor building conditions and treatments, inappropriate sib age, lack of screening, and lack of trees and shrubs." "The City should work with the community council to improve azeas of the University Avenue corridor maintained by the City. Deficiencies include inconsistent sidewalk and boulevard surface treatrnent, frequent and duplicafive parking and directional sig�is, lack of trash containers and attractive street li�ting, and inadequate landscaping." "Encourage private development of vacant lands in Bnergy Park, the fornler Sussel Company property and the Admiral Merchant Trucking property. Commercial and industrial uses with minimal negative impacts on nearby residential areas should be given highest priority consideration." The District 12 Plan designates the IJniversity Avenue/T.H. 280 Redevelopment Area for redevelopment into higher intensity industrial uses. In 1985 the District 12 Community Council compieted a"Development Strategy for the West of T.H. 280", the Redevelopment Area. That strategy took the City's Comprehensive Plan recommendations and applied them to the Project Area. That strategy recommended that a Redevelopment Project be 13973.1 undertaken by the Port Authority and the FIR A in this area The Strategy recommended that the area be redeveloped for the creation of light industrial, office/research, and service related industries with an emphasis on labor-intensive activities. The District 12 Strategy also pursued the District 12 Plan recommendations regarding University Avenue, emphasizing the need to improve the physical image of the avenue and of T.H. 280 as gateways into Saint Paul and this major employment center. University Avenue — T.H. 280 Redevelopnient Study Based on the District 12 Plan and the District 12 Strategy, The City of Saint Paul completed a Rcucveloprricr�i Study oi the Project Area, iut'�11e� iei i ning �um�irehe[isive Fien goais arld objecis as well. The Study deSned the following �oals for the Project Area: Increase the number of jobs in the Study Area. Desi� and market the 3tudy Area primarily as a location for small industrial-office businesses which have a high rario of empIoyees per acre. Increase the assessed value of real estate in the Study Area. Attract Iugh-quaIify land investrnents by creating a comprehensiveIy-planned industrial-business pazk which provides a development environment comparable to the better-quality contemporary parks. Improve the image of the Study Area. Respond to the needs and desires of the community in the Redevelogment of the Study Area. The "Redevelopment Study" further elaborates strategies which the Port Authority and/or the FIIZA will consider in the specific implementation activities to be conducted in the Project Area aud District. tlnd the foIIowing objectives, unportant to the implementation of Comprehensive Plan recommendations and directions: To remove or rehabilitate substandard and blighting buildings. To assemble adequately sized parcels for redevelopment To coordinate acquisition, site prepazation and improvements, provision of necessary public improvements and faciliries, and to spread and equalize the cost thereof, in order to accomplish the entire project development at a cost reasonably related to the public purposes to be served. To provide private developers with information regarding zoning; land use controls and other City and Plan requirements, information and assistance in obtaining construction and permanent fmancing; information and assistance regarding construction of site and public improvements and measures necessary to correct site conditions, all in accordance with deveTopment agreements. To finance the development costs of the Project by means of tax increment generated by the Project improvements and development. 13973.1. oa-��'� To finance development by a combination ofprivate and public financing under authority and subject to the requirements of federai, state and local law, and ordinance for the provision of revenue bond financing. D. Development Frogram The development program for this Proj ect is further set forth in Section G of this Plan. Generally, the role of the public sector in commercial and industrial development has been to assemble and deliver development sites, and provide controls and incentives in order to encourage and obtain needed deveiopment. Among fne various mecnanisms avaiiabie io Fne �iiy azid i�s redeve,opment agencies are: Acquisition to acquire as authorized under the Housing and Redevelopment Act, Minnesota Statutes, an the Tax Increment Financing Act. (a) blighted areas, buildings and other real property, where removing such can remove, prevent or reduce blight or the causes of blight; (b) open or undeveloped ]and blighted by viriue of conditions which have prevented normai development by private enterprise; (c) underused or inappropriately used land wluch may be converted to other uses recommended by the Plan; (d) lands or property necessary to complete assembly of parceis suitable for redevelopment; (e) other real or personal property as necessary to accomplish the objectives of the Plan; and ( fl lands or property deemed to be unsafe or hazazdous to the public's health and safety. 2. Site Preparation and Public Improvements (a) demolition, reinoval or rehabilitation of buildings and improvements; (b) activities to correct adverse physical characteristics of the faulty land division or inadequate access or utility service or other development-inhibiting conditions; (c) activities deemed necessary or desirable to remove, reduce or prevent other blighting factors and causes ofbli�ht; (d) activities deemed necessazy or desirabie to improve and prepare sites, including the correction of soil conditions, for commercial and industrial development or redevelopment purposes in accordance with the Pian; and 13973.1 (e) installation, construction or reconstruction of streets, utilities, and other public improvements or facilifies as necessary or desirable for carrying out PIan objectives. ( fl any studies or research that may be necessary to determine the traffic or land use impacts of any development proposal and/ar particular street and traffic pattem. (g) provisions of relocarion services, assisfance and benefits in accordance with Minnesota Statutes Chapter 117. C,ommerciai and Industriai rinancing It is the City and its redevelopment agencies intention to make available as appropriate and feasible, and upon the sole deternunation of said agencies, affordable sources of financing to developers, corporations, small businesses and other organizataons involved in the commercial, office, and industrial sectors. There are a number of financing mechanisms that can be used as appropriate to accomplish the City and its redevelopment agencies goals and objectives: (a) Industrial Development Revenue Bond I,oans — This provides below market rate loaris to finance manufachuing projects; (b) _ Urban Development Action Grant Loans — This federally funded program provides low interest, long-Yerm loans to industrial, housing, and commercial projecYs with special emphasis on distressed azeas; (c) Tas Increment Financing — This locally administered tool provides a means by wIuch to redevelog blighted areas, assist indusixy and create affordable housing; (d) Special Assessment Financing — This locally raised and administered source of financin� provides benefifing properiy owners an affordable interest rate and long term financing mechanism by which to repay public improvements; (e) SBA 503 I,oan GuaranYee Program — This federally sponsored program provides loan guarantees to banks providing loans to qualified small businesses; (� Such other local, re,�ional, state, federat, an private financing programs or mechanisms as may be available during the duration of the Disirict. 4. Land and Other Financing Assistance The City and its redevelopment agencies may enter into long-term lease arrangements rather than land sale contracts where appropriate. One type of lease azraugement would allow a developer to spread 2and costs over a longer period thus reducing cash equity requirements. The City and its redevelopment agencies may, where appropriate and at their sole discretion, aiso execute agreements to make periodic assistance payments to developers to reduce the difference between 13973.1. b'a - l.�'1 5. � E. fair market rents obtainable, and debt service and expenses necessary to operate a project at a feasible level. In selecting methods of project finance, the Port Authority and/or the HRA will take into account the forms of other assistance available and negotiate with individual developers so that a method can be chosen which provides sufficient incentive for the developer to create quality product. Developer of Each Parcel in District Deveioper wili occur in accordance with Section G of the FIan on eacn parcei of the District either pursuant to private financing, or through redevelopment agencies in which latter case all developers shall execute minimum taac assessmenY agreements with the Ramsey County Assessor. Promotion of Development of the Redevelopment Area To implement this Pian, the Port Authority and/or the HRA will provide for, or cause to provide for, the following, as is necessary and appropriate. ADMINISTRATION of those public processes and requirements deemed necessary to support or allow development/redevelopment of pzoperty to occur in accordance with this Plan. If applicable and advisable, the Port Authority and/or the IIRA will provide or cause to provide: (a) Coordination of project acfivity, fmancing and review with human service agencies, citizen participation entities, and other state, regional and federal government agencies; (b) Initiation of vacations, rezonings, dedication of public rights-of-ways, or otl�er public actions as may become necessary to implement this Plan, in accordance with state and local statutes. This wili be undertaken by the Port Authority, HRA or the redeveloper. (c) Enforcement of building codes, design controls, site covenants, provisions to ensure compliance with state and local requirements relating to non-discrimination, income leveis, environmental quality, faithful performance, and any other public objectives relafing to the purchase, development, improvement or use of the land; (d) Property exchanges. Description of Taac Increment District Property The University Avenue/T.H. 280 Tax Increment Financing District tas parcels identified by Properiy Identification Numbers and Property Addresses are the foilowing: l. 292923330016 2580 University Avenue 2. 292923320037 2600 University Avenue 13973.1 F. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. zz. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 292923320030 292923320038 292923320029 292923320028 292923320027 292923320026 292923320019 292923320020 292923320023 2929L33200L4 292923320025 292923320021 292923320022 292923320002 292923320003 292923320004 292923320005 292923320006 292923320007 292923320008 292923320009 292923320010 292923320011 292923320012 292923320013 292923320014 292923320015 292923320016 292923230012 292923230013 292923230014 292923230001 292923230002 292923230005 292923230015 292923230007 292923230008 292923230016 Development Activities Under Contract 2545 Univezsity Avenue 2583 Univetsity Avenue 2631 University Avenue 2633 University Avenue University 2635 Uiuversity 2640 TemtoriaI Charles TerriYoria] C:haries Curfew 2618 Territorial Temtorial Territorial 958 Berry 2625 Temtorial Eustis Eustis 935 Enstis 935 Eustis 929 Eustis 927 Eustis 923 Eustis 917 Eustis 913 Eustis 907 Eustis 903 Eustis 899 Eustis 1000 Berry 965 Eustis 1005 Eustis Eustis Unassigned Uaassigned Unassigned Unassigned Unassigued Unassigned At the time this Plan was prepazed, no redevelopment contracts had been entered into among the City, the HRA, the Port Authority, or other redevelopment agencies, or a third pariy. See Section G for development activity contemplated during the duration of the University Avenue/T.H. 280 Tax Increment Financing District. 13973.'I oa-c�a� G. Expected Development Activities A more predictable schedule of development activities can be estimated upon the resolution of two major issues relating to the Project District. As each of these issues is resolved, private development and other public development activities are expected to be commenced at a schedule, level, and sequence consistent with normai industry standards associated with a project of this ma�itude. The tv✓o prominent issues involved in the success of the overall design of tlus new industrial-office park, 2nd c: the desi� of t�'�e iadiv;dual s;tes, aze: the timeliness of acquisition and subsequent removal of all blighted structures, and; 2. the creafion of a new development within unified design b idelines. Consequently, since the plan for land acquisition is important in achieving the desu•ed change of image, and in indicating a public commihnent to the project, and in eliminating the negative effect which a prolonged acquisition schedule would have on property owners: l. the entire tract of land is proposed for immediate purchase, and; 2. building design and landscaping guidelines should be adopted as presented in the University Avenue/T.H. 280 Redevelopmenf Plan, Section IV, "Land Use", subsections A-E and Section V, subsection E, "Urban Design Guidelines," and subsection F, "Other processes for Implementing Land Use Desib ations." Those specific portions of the Redevelopment Plan are included in Appendix 2, attached hereto and made a part thereof. H. Classifications of Taac Increment Financing District The City Council of the city of Saint Paul, Minnesota, in determinin� the need for a TaY I�icrement Financing Districts in accordance with Minnesota Statute, Section 273.71-273.78 inclusive, fmds that the district to be established as a redevelopment district pursuant to Minnesota Statutes Section 273.73, Subdivision 10. Furthermore, the Port Authority of the City of Saint Paui and the Housing and Redevelopment Authority of the City of Saint Paul are establishing a redevelopment project which qualifies as redevelopment project in blight and deteriorated areas under the Housing and Redevelopment Act, Section 462.421 (13) in as an industrial development district under Minnesota Statutes 454458.191. I. Property in Acquisition The land use plan proposes to remove most of the existing businesses and a11 of the housing the study area. The F�ZA may require by eminent domain certain privately owned parcels of land in the land use area necessary to cany out the project for disposition for redevelopment in accordance with the project '13973.1. redevelopment plan at a consideration covering acquisition cost includin� relocation of displaced occupants. K. Estimates of Costs Financing needs of the 280 Tas Incremenf Financing Disfrict Property Acquisition Building Demolition Residents and Business Keiocation Street and Utility Improvements Street Landscapin� and Lighting General Grading Discount.(Cost of Issuance Debt Service Reserve Capitalized Interest Projected Debt Service Shortfall Aduiinistration Legal Miscellaneous Contingency Total $10,227,000 1,266,500 i,3 i 9,OOu 1,237,000 106,450 150,000 735,000 2,100,000 5,703,752 1,450,000 ioo,oao 75,000 100,000 715,298 $25,285,000 The total amount ofbonded indebtedness for the 280 Redevelopment Project is $25,285,000. Identification of the Use of T� Increments Pursuant to Minnesota Statutes Section 273.75, Subdivision 4, aIl revenues derived from the taa� increment district sha11 be used in accordance with this Tax Increment Financing Plan. The revenues shalt be used for the following purposes: 1. 2. 3. 4. 5. To pay principal of and interest on bonds issued in aid of the district, if any; To repay any loans including interest on these loans as authorized by the I�tt�/Port Authority to pay for any site and public improvement costs; To fund and repienish a debt service reserve for the project of principal and interest on bonds used to finance a project; To pay for project cosfs and administrarive expenses as idenfified in the project budget described in Sectian T above; and To pay for projecY costs in addition to those idenrified in the project budget, which aze detemiined by the HRA/Port Authority to be necessary to the accomplishment of the redevelopment and taz� increment financing plans. 13973.1 oa-��� L. M. Limitation on Administrative Expenses Pursuant to Minnesota Statutes Section 273.75, Subdivision 3, as amended, administrative expenses are limited to ten percent (10%) of the total tas increment expenditures. "Administrative expenses" means all expenditures of an authority other than amounts paid far the purpose of land or amounts paid to contracYors or others providing materials and services, incIuding azchitectural and engineering services, directly connected with the physical development of the real property in the district, relocation benefits paid to our services provided for persons residina or businesses located in the district, or amounts used to pay interest on, fund a reserve for, or sell at a discount bonds issued pursuant to Section 273.77. "Administrative expenses" includes amounts paid for services provided by bond counsel, fiscal consultants, and platming and economic development consultants. Souces of Revenue to Finance Public Cost It is intended that the entire public project cost, to the extent possible, be paid froin the tax increment generated by the redevelopment. This does not include the HRA/Port Authority from us]ng other funds, at its discretion, to pay such cost. Estimated Revenue Sources of revenue to finance public costs l. Tax Increment Esrimate: 280 Redeveloument Proiect (estunate� Construction and Land Cost Total Estimated Mazket Value Total Assessed Value at 43% Assessment Ratio Original Assessed Value Captured Assessed Valuation Captured Assessed Increment - $45,855,000 - 36,684,000 - 15,774,120 - 2,510,103 - 13,264,017 - 1,684,530 The increment resulting from the above captured value will be used in the following categories in order: To pay principal on interest and bonds to finance project To fund and replenish debt service account forbonds issued to finance project 2. To finance or otherwise pay financing and public development costs of the project pursuant to Minnesota Statutes, Chapter 462 To pay administrative expenses and other project related costs. Q 13973.1 To return to County of Ramsey for distribution to impacted taxin� jurisdictions. N � Diu�arion of the District Pursuant to Minnesota Statutes Secfion 273.75, Subdivision 1, the maxunuxn duration of a taY increment redevelopment district is 25 years from the date of receipt of the first increment by the authority. It is estunated that the HR� could collect t� increments on the district through the year 2014. ImDact on Other Taxin¢ Jurisdictions The overlapping jurisdicrions upon whose assessed valuation this tas increment financing plan could have an in�pact aze: - Independent School District No. 625, whose boundaries are coterminous with those of the City of Saint Paul. - County of Ramsey, to whose assessed totaI vaIuation the City of Saint Pau1 contributes about 54%. - Housing and Redevelopment Authority of the City of Saint Paut, which is the requesting authority. The FII2_A may be considered as being identical with the City of Saint Paul for purposes of this analysis. - Port Authority of the City of Saint Paul, whose powers of levy and uses of property tax revenue is limited. Far ttris analysis, they may be treated the same as the City of Saint Paul. - Metropolitan authorities — such as the Metropolitan Council, Metropolitan Airport Commission , Metropolitan Transmit Commission, Metropolitan Waste Control Commission, and Metropolitan Mosquito Control Districf. Of fhese metropoIitan authorities, only the Metropolitan Covncil, Metropolitan Transit Commission and Metropolitan Mosquito Control District levy on real estate. Of these overlapping taacing authoriries, flie only two which could be affected more than nominally by this ta�c increment financing plan would be Independent School District No. 625 and the County of Ramsey. Assuming captured assessed value of build-out of $13,204,107, in accordance with Section N hereof, and a constant 1986 mill rate of 127 mills, the disfrict will generate an annual tax increment of $ I,676,910. Tve percentage of this incremenf contributed by the various tazing jurisdictions, if the development had occurred without public intervention, is shown below. Tabie 1 Percent of Taat Increment and Fxcess TaY increment Attributable to Tasing 7urisdictions Current Tasina 7urisdiction Mills Percent Annual Taac Increment 13973.'I. o�-�.�� City of Saint Paul 36.850 School District #625 50.494 Ramsey County 32.225 Other 5.494 127.137 29.4 40.6 25.7 43 100.0 $ 493,017 680,825 430,965 72.108 $1,676,910 The followin� table represents the additional mills that would have to be levied to compensate for the loss oftax dollars in estimated tax increments and excess taac increments for each fasing jurisdiction. The tax increments derived from the project included in the taac increment district would be available to any of the taxing jurisdictions were it not for public intervention by the City. Although the increases in assessed value due ta development will not be available for the applicarion of the mill levy for the duration of the taac increment financing district, tlus new assessed value could eventually pemut a mill levy decrease. If it could be assumed that the captured assessed value was available for each taxing jurisdiction the non-receipt of tax dollars represented as tax increments may be defexmined. This determination is facilitated by estimating how much the mill levy for property outside of the tax increment financing district and the Hainmond district wouid have to be increased to raise the same amount of tax dollars in each taacing jurisdiction that would be available if the projects occurred without the assistance of the City. Table 2 Ixnpact on Tasin� Jurisdictions (if Development Could Occur Without Public Assistance) Adjusted* 14986 Required Taxin� Jurisdictions Assessed Value Mills City of Saint Paul $1,781,595,372 .000277 Schooi District #625 $1,781,595,372 .000382 Ramsey County $3,378,954,041 .000128 '�District Assessed Value Subri•acted Aiusual Tax Increment $433,011 $680,825 $430,965 Table 2 is relevant only if one assumes the development would have occun without the existence of the district and the development pro� ff this assumption is istcorrect, and the Authority believes it is, then the only real impact on the assessed values of the other ta7cing jurisdictions is: 1. Any inflationary values from the district which have been attributable to the tax base of these taacing jurisdictions will be lost during the duration of the district; and 2. Upon termination of the district, all taxing jurisdictions will benefit from the entire then-current assessed values. � Modifications 13973.1 In accordance with Minnesota Statutes Section 273.74, Subdivision 4, a tax increment financing plan may be modified by an authority, provided that any reduction or enlar�ement of geographic area of the project or tas increment financing district, increase in amount of bonded mdebtedness to be incurred, including a determination to capitalize interest on the debt if that determination was not a part of the original plan, or to increase or decrease the amount of int0rest on the debt to be capitalized, increase in the portion of the captured assGssed value fo be retained by the authorify, increase in total estimafed taac increment expenditures or desiaiation of adctirional property to be acquired by the authoriry shall be approved upon tke noYice and after the @iscussion, public hearing and findings required for approval of the orieinal nlan; provided that if an authority changes the type of dishict from housing, redevelopinent or economic development to another type of dishict, this change shall not be considered a modification but shall require the authority to follow the procedure set forth in Sections 273.71 to 273.78 for adoption of a new plan, including certification of the assessed valuation of the district by the county auditor. The geographic area of a ta�c increment financing district may be reduced, but shall not be enlarged after five years following the date of certification of the oria nal assessed valae by the county auditor or f ve yeazs from Aub st 1, 1979, for tax increment financing disiricts authorized prior to August i, 1979, except that development districts created pursnanT to chapter 472A prior to Auwst 1, 1979, may be reduced but shall not be enlarged after five years following the date of designarion of such district. Q. Limitation on Duration of Taat Increment Financing Districts Pursuant to Minnesota Statutes Section 273.75, Subdivision 1, "no taac increment sha1I be paid to an authority three years from the date of certification by the County Auditor unless within the three-yeaz period (a) bonds have been issued pursuant to Secfion 7 or in aid of a project pursuant to any other law, except revenue bonds issued pursuant to chapter 474, prior to the effective date of the Act; or (b) the authority has acquired property within the district; or (c) the authority has constructed or caused to be constructed public improvemants within the district..." The Housing and Redevelopment Authority must therefore issue bonds, or acquire property, or construct or cause public improvements to be constructed by 1985 or the Office of the County Auditor may dissolve the tax mcrement district. R. Limitation on Qualification of Properiy in Ta�c Increment District Not Subject to Impmvenzent Pursuant to Minnesota Statutes Section 273.75, Subdivision 6, if, after four years from the date of certification of the original assessed value of fhe tax increment financing district pursuant to Section 273.76, no demolition, rehabilitation, construcrion or renovation ofproperry or other site preparation, including improvement of a street adjacent to a pazcel but not installafion of utility service including sewer or water systems, has been commenced on a parcel located within a taac increment financing district by the authority or by the owner of the parcel in accordance with the ta�c increment financing plan, no additional taac increment may be taken from that pazcel, and the original assessed value of the taa: increment financing aistrict. If the authority or the owner of the parcel subsequeatly commences demolition, rehabilitation or renovation or other site preparation on that parcel including improvement of a street adj acent to that parcel, in accordance with the t� increment financittg ptau, the authority shall certify to the county auditor that the acrivity has commenced, and the county auditor shall certify the assessed value thereof as most recently certified by the commissioner of revenue and add it to the original assessed value of the tax increment financing district. For purposes of this subdivision "parcal" 13973.1 01. �>�l means a tract or plat of land established prior to the certificarion of the district as a singIe unit for purposes of assessment. Annual Disclosure Requirements Pursuant to Minnesota Statutes Section 273.74, Subdivision 5, a city must file an annual disclosure report far all tax increment financing districts. The report shall be filed with fhe school boazd, county board and the Minnesota Department of Energy, Planning and Development. The report to be filed by the City Administrator as district administrator shall include the following information: The aniount and source of revenue in the accouut; 2. The amount and purpose of expenditures from the account; 3. The amount of any pledge of revenues, including principal and interest on any outstanding bonded indebtedvess; 4. The original assessed value of fl�e district; 5. The captured assessed value retained by the authority; 6. The captured assessed value shared with other taxing districts; and The tas increment received. The annual disclosure report is desi�ed to be a two-way medium of information dissemination for both the Office of the County Auditor and the City. Should the auditor want additional information from the authority regarding its taa� increment financing activities, such information should be requested prior to subinission of tke annual disclosure report by the authority. Similarly, the authority may utilize the annuai disclosure report as a means for requesting information from the Office of tYie County Auditor. Additionally, the authority must annually publish a statement in a newspaper of general circulation in the municapality showing the taac increment received and expended in that year, the original assessed value, the captured assessed value, amount of outstanding bonded indebtedness and any additional information the authority deems necessary. T. Requirement for Agreements with Developer Pursuant to Minnesota Stahxtes Section 273.75, Subdivision 5, no more than 25 percent, be acreage, of the property to be acquired within a project which contains a redevelopment district, or ten percent, by acreage, of the property to be acquired within a project which contains a housing or economic development district, as set forth in the tas increment financing plan, shall at any time be owned by as� authority as a result of acquisition with the proceeds ofbonds issued pursuant to 5ection 273.77 without the authority havin� prior to acquisition in excess of the percentages concluded an agreement for the development or redevelopment of the property acquired and which provides recourse for the authority should the development or redevelopment not be compieted. 13973.1. The agreements are only required if property is to be acquired with bond proceeds. U. Assessment Agreement Pursuant to Minnesota Statutes, Section 273.76, Subdivision 8, the City may, upon entering into a development ageement pursuant to Minnesota Statutes Section 273.76, Subdivision 8, enter into an a�reement in recordable form with the developer of property within the tas increment financing district wliich establishes a minimum market value of the land and completed imnrovements for the duration of the tax increment redevelopment district. The assessment agreement shall be presented to the county assessor who st�a11 review the plans and specifications for the improvements consiructed, review the mazket value previously assi�ed to the land upon which the nnprovements are to be constructed and so long as the minimum market value contained in the assessment a�eement appears in the judgment of the assessor, to be a reasonable estimate, the assessor may certify fhe minimum market value agreement. V. Notification of Prior Planned Improvements Pursuant to Minnesota Statutes Section 273.76, Subdivision 4, the authority shall, after due and diligent seazch, accompany its request for cerfification Yo fhe county auditor pursuant to Subdivision 1, or its notice of district eniazgement pursuant to Section 273.74, Subdivision 5, with a listing of all properties within the taac increment financing district or azea of enlazgement for which building permits have been issued during the 18 months immediately preceding approval of the taY increment financing plan by the municipality pursuant to Section 273.74, Subdivision 4. The county auditor shall increase the original assessed value of the district by fhe assessed valuafion of the improvements for which the building permit was issued, excluding the assessed valuation of improvements for which a building permit was issued during the fliree month period immediately preceding said approval of the Tax increment financing plan, as certified by the assessor. W. Admirristration ofthe Tax Increment Economic Development Dishict Administration of the tas increment redevelopment disttict will be handled by the Housing and Redevelopment Authority through the Department of Planning and Economic Development. X. Tax Increment Financing Accounts The ta�c incremenT received as a result of increases in the assessed valne of the tax increment redevelopment district parcels will be maintained in the existing ta�c increment account by the City Treasurer. The taac increment account will be separated from all other municipal development disfzict accotuits and grant accounts and expended only upon sanctioned redevelopment activities identified in the finance plan as amended. Y. Estimate of Amount of Bonds Indebtedness 280 Redevelopment Project '13973.1. o�-w� The City may finance public improvements by sale of tax increment bonds. Increment revenues may be used to fund a debt service reserve and to pay the cosfs of any authorized credit enhancements needed to mazket the bonds. This does not preclude the HRA or Port Authority from bonowing funds to meet project costs. Such borrowing may be repaid from Tax Increment proceeds. 13973.1 o�_c.�� University/T.H. 280 (Westgate Office Industrial Park) Hazardous Substance Sub-District Amendment Dated May 28, 2002 Creation of Hazardous Substance Sub-District Ti�c ia,i ii�::ic��ic;ti pidii iciaicS i0 i l ic C7Eaii6it wii i ic i a.x iIlGleiiie:'ii iiSuiCi Gi a naZaiuuu5 Substance Sub-Dish�ct (the "HSS") pursuant to Minnesota Statutes Section 469.175, Subdivision 7. 2. Need and Public Purpose The University/T.H. 280 site has been used for over 100 years by heavy industry including railroads, paint manufacturing, waste haulers, food processing and tank and drum recyclers. Many current axid previous property occupants stored, used, and disposed petroleum and hazardons materials at the property. The heavy pollution at this site has resulted in a lack of private investment in this area. As a result, the property has not provided adequate employmeut opportunities and has not contributed to the tax base and geiieral economy of the City, the school district, the County and the State to its full potential. CSM Corporation plans to develop the final phase of the Westgate Office Indusfrial Park. The proposed development consists of an 98,165 square foot light industrial office/showroom building. It is necessary that the Port Authority exercise its port authority powers under state law to develop, implement and finance a program designed to encoura�e, ensure and facilitate the redevelopment of this property. T'his redevelopment will further accomplish the public purpose specified in this paragraph. Objectives for improvements in the Westgate Office Industrial Park A. Provide job opportunities for Saint Paul residents. Based on similar development projects CSM Corporation has completed in the Westgate Office Indushial Park and surrounding area, CSM estimates that up to 225 jobs may be created by the proposed development. B. Develop a Iight industrial office/showroom building in the Westgate Office Industrial Park. The site to be developed in the District will provide approximately 7.5 acres of deveIopable land. The proposed development consists of a 98,165 square foot building. Site remediation is expected to commence during the third quarter of calendar year 2002 and construction of the project is anticipated to be complete before December 31, 2003. C. Exgand the tax base af the City of St. Paul. It is expected that the tasable market value of site may increase by approximately $5,800,000 once tl�e development is completed. This value will come from private 13973.1. development of approximately 98,165 square foot building wifh a high level of office finish and an anticipated construction value of �66.00 per square foot..The taYable value I� of new facilities is assumed to be 90% of their construction cost. Hazardous Substance Remediation CSM Corporation will undertake the removal and remediation of the soil, as specified in a Response Action Plan that was approved by the MPCA. Contaminants, such as volatile organic compounds, polychlorinated biphenyls (PCB), polynuclear aromatic hydrocarbons and heavy metals were identified on the site. 4. Description of the Project's Sources and Uses The following, as required by Section 469.175, Subdivision 1(5), are estimates ofthe (A} cost of the Project, including administration expenses; (B) sources of revenue to finance or otherwise pay public costs; (C) the ori�inal tas capacity and captured tax capacity of the HSS District; and (D) 17e duration of the HSS District's existence. Q : Cost of the Project The total cost of the Proj ect, assuming a high level of office finish, is estimated at $9,500,000. Sources of Revenue The foliowing are the likely sources for funding the total Proj ect: 1. Tax Increments Based on the assuxnptions set forth above, taac increments, net of up to 10% for administration expenses, are anticipated to equal $150,000 annually. 2. State of Minnesota Denartment of Trade and Economic Development This agency has awazded funding in the amount of $500,000 for the redevelopment of this polluted site. 3. Private Sector Contribufions • ADM • Northern Star Company • Burlington Northem' $800,000 60,000 To be detemiined 4. Gap Funding CSM Investors II, Inc. has committed to completing the project. These fiznds will be idenfified prior to full implementation of the Project. � Burlington Northem has not yet wmmitted to This contriburion. CSM is currently in negotiations with Burliugton Northem. CSM Investors II, Inc. is prepazed to cover any gap funding required to complete the proj ect. 13973.1. o �_ c.>� C. Qriginal Tax Capacity and Captured Tax Capacity The original tax capacity of the HSS is $4,573. Expected remediation expendifures of $2,400,000 deducted from the original taY capacity results in the maximum captured tas capacity allowed in the amount of $4,573. D. Duration of the Hazardous Substance Sub-District The ori�inal Tati Increment District was certified in 1988. The duration of the ori�inal district runs 25 years from the first receipt b_y the Port Authority of tas increments, which wiil oe fnrough calendar year 20i6. The duration of HSS District wiil run the lesser of (a) 25 years or (b) the period of time necessary to recover the cost of the removal or remediation actions specified in the Response Action Plan that was the foundation for the creation of the HSS District. Identification of all parcels to be included in the ASS Attached hereto in Appendix B is a list of the Property Identification Numbers for all properties to be included in flie HSS District, a map showing the Project azea and a legal description identifying the boundaries of the HSS District. 6. Hazardous Substance Sub-District Certification of the HSS will allow ta�ces attributable to the base value of the District to be used to reimburse or pay all or a portion of the estimated $2,400,000 of pollution testing and remediation costs. As was mentioned in Section 4(C) above, the HSS will cause taxes on the base value of the District to be lost until such time as the pollution costs are safisfied. Total base tases payable in 2002 were approximately $6,484. As mentioned above, a Response AcUon Plan was submitted azid approved by the MPCA. The Port Authority has studied the TaY Increment District and concluded the development would not reasonably be expected to occur solely tlu private investment and tax increment otherwise available from the District, and therefore the use of the HSS is deemed necessary. Fiscal Disparities The Port Authority and the City have elected to compute Fiscal Disparities contribution for the District in accordance with Section 469.177, Subdivision 3, paragraph a. 13973.1. D �.- (.�'! Port Authority of the City of St. Paul tiNIVERSITY/T.H. 280 (WESTGATE OFFICE INDUSTRIAL PARK) Hazardous Substance Snb-District and Parcel List Aazardous Substance Sub-District Legal Description: Parcel 1: Outlot C, Westgate Addition No. 3, accordin� to the recorded piat thereof, Ramsey County, Mi�esota. Parcel2: That part of Lot 2, Block 1, West�ate Addition No. 3, according to the recorded piat thereof, Ramsey County, Minnesota, which lies Northerly and Easterly of the followin� described line: Commencin� at the Southeast corner of said Lot 2; thence South 89 degrees 47 minutes 02 seconds West, along the South line of said L,ot 2, a distance of 455.75 feet to the point of beginnui� of the line to be described: thence North 00 degrees 08 minutes 03 seconds West, a distance of 227.50 feet; thence South 89 deb ees 36 minutes 54 seconds West, a distance of 167.12 feet to the West line of Southwest'/n ofthe Northwest'/< of Section 29, Township 29 North, Range 23 West of the Fourth Principal Meridian and there said line tenninates. Parcel List: 29-29-23-23-0031 29-29-23-23-0034 13973.1 o > - t.�'1 Universiiy Avenue/T.H. 280 (Westgate Office Industrial Park) Hazardous Substance Sub-District Sources and Uses of Funds Sources CSM Investors II, Inc. ADM Contriburion Northem Jtaz ConLTibuticn Burlington Northern Contribution� TIF Available for Project Hazazdous Substance Sub-Distiict DTED Grant Total Sources Uses Hard Costs: Acquisition Environmental Testing Environmental Consultui� Additional Boring and Analysis Overburden/Nlobilization Excavate Foots Stabilize Hot Spots Regrading Site Clean Fill on Site Asphalt Cap Unusual Bui]ding Costs (Piles) Demolirion Costs Clean up Contingency Shell Building Costs Office Tenant Improvements Warehouse Teuant Improveinents Consfivction Contingency Tota] Hard Costs Soft Costs: Architecriiral/Engineering City Fees LegaUSurveylI'itle/Recording Leasing Coxsunissions Lender Fees Loan Fees Developer's Overhead Soft CostContingency Interim Interest Total Soft Costs Total Uses $6,584,781 800,000 tiu,uUv 0 1,403,657 156,407 500 000 $9,504,845 $ 805,770 I50,000 100,000 50,000 %,905 714,600 676,500 169,135 244,540 265,763 300,000 165,369 259,281 2,944,950 1,472,475 176,697 137.824 $8,719,809 $ 147,248 29,450 40,000 184,059 17,500 51,924 I50,000 18,605 146 �50 $ 785,036 $9,504,845 � Burlington Northem has not yet committed funding to this project. CSM Corporation is currendy in negotiations with Burlington Northern. 13973.1 Table 1 Assumptions and Summary: University Ave. —TH 280 Redevelopment Study SCENARIO C: LOW OFFICE ESTIMATE, 3°/a IIVFLATTON, LAND LEASING, SINGLE YEAR LAND ACQUISITION ASSL3MPTIONS Orioinal Assessed Value Assessed Value of New Consiruction Assessed v RPAIl1VP Fiscal Disparities Pooi Contribution Origival Assessed Value Inflarion Ratio New Assessed Valve Inflation Ratio Mili Rate Discount for Delinquent Tax Collections Term of First Bond Average Bond Interest Rate Discount and Cost of Bond Issuance Rate of Investment Eamings Contingency SUMMARY Total Tax Increment Revenues Net Bond Proceeds Total Project Revenues Total Project Costs Paz Amount of Bonds DEVELOPMENT PROJECTS Conshuction Cost $2,510,103 Office (350,000 sf @ $80/s fl $2$000,000 $15,714,120 Office-Showroom$185,OOOsf@40/sfl $7,32Q000 �oFR ni F uP�P�r�t, gi i n nnn �tn � tsi�fl e3,gsn nnn -- - � --- $0 Li�ht Industry (191,000 sf @ $35/sfl �6,685,000 0.00% 3.00% 0.127 0.03 24 11.00% 3.50% 6.00% PUBLIC EXPENDI'I'URES 715,298 Property Acquisition Bui]ding Demolition Resident and Business Relocarion Street and Utility Irz�rovements S�eet Landscaping and Lighting General Grading '13973.1 o z - �s'1 Table 2 Esfimete of Ta;c Increment Revenue Years Original Assessed Value Land+Bld�. Less A.V.New Fiscal Construct. Dispaz. Captured Assessed Value Plus Plus Inflation Inflarion Less A.V. Growth of Growth of Received New A.V. Orig. A.v. Current Assessed V21ue Capmred Assessed Value to-Da:e Mi11 Rate Annual Tax Increment Revenae 13973.1 Table 3 Froject Cash Flow Year Annual Project Income Annua] Tax Increment Bond Revenues Proceeds Interest On Fund Balance @ 6.00% Land Lease Income @ ] 0.00% Eamina Total Reserve Annual fund Project Revenues Deht Service Annual Pro�ect Cost Acquisition Planning Demolition Public and Aelocation Improve'ts Admin. 13973.1 Oi- ��'1 Project Contingency 13973.1. Total Annual Project Costs Cumulative Fund Balance Before Other Income Other Income Cumularive Fund Balance ARer Other Income