04-580Council File # 0� � S �✓
Green Sheet # �� �/ �,��
— RESOLUTION
OF SAINT PAUL, MINNESOTA �
Presented By
Referred
Committee: Date
RESOLUTION NO.
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RESOLUTION APPROVING THE
ESTABLISHMENT OF THE TENTH AND JACKSON STREET
TAX INCRE141ENT FINANCING DISTRICT,
APPROVING A TAX INCREMENT FINANCING PLAN THEREFOR
AND APPROVING THE MODIFICATION OF THE
REDEVELOPNSENT PLAN FOR THE
NORTH QUADRANT REDEVELOPMENT PROJECT AREA
��HEREAS, the Housing and Redevelopment Authority of the City of Saint Paul,
Minnesota (the "HRA") has heretofore, with the approval of the City Council of the City of Saint
Paul, Minnesota (the "City"), adopted the North Quadrant Redevelopment Plan for the North
Quadrant Redevelopment Project Area (the "Project Area"), as amended by the First Amendment
of Redevelopment Plan for the North Quadrant Redevelopment Project Area (collectively, the
"Redevelopment Plan"), pursuant to Minnesota Statutes, Sections 469.001 to 469.047, both
inclusive; and
18 WHEREAS, said Redevelopment Plan contains an identification of need and statement of
19 objectives and program of the HRA for carrying out of a redevelopment project, including
20 property to be acquired, public improvements to be provided, development and redevelopment to
21 occur, and sources of revenue to pay redevelopment costs of the Project; and
22 WHEREAS, the HRA has proposed creation within the Project Area of the Tenth and
23 Jackson Street TaY Increment Financing District as a redevelopment tax increment financing
24 district under Minnesota Statutes, Section 4b9.174, Subdivision 10 (the "Tax Increment
25 DistricY'), and the adoption of a T� Increment Financing Pian therefar all pursuant to and in
26 accordance with Minnesota Statutes, Section 469174 through 469.1799 (the "Tax Increment
27 Act"); and
28 WHEREAS, the HRA has proposed to adopt the Second Amendment of Redevelopment
29 Plan for the Project Area to expand the boundaries of the Project Area to include the parcels in
30 the Tax Increment District (the °Modification"); such Modification to be adopted by the Board of
31 Commissioners of the FIRE1 on June 9, 2004; and
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WHEREAS, the HRA has performed all actions required by law to be performed prior to
the creation of the Tas Increment District, the Modification of the Redevelopment Plan and
adoption of the Tax Increment Financing Plan therefor, including, but not limited to, notification
of the Ramsey County Commissioner representing the azea of the County in which the TaY
Increinent District is located, and delivering a copy of the T� Increment Financing Plan to
Ramsey County and Independent School District Number 625, which have taYing jurisdiction
over the property to be included in the Tax Increment District. The IIRA has requested that the
City approve the Modification and adoption of the Tax Increment Financing Plan following the
holding of a pubiic hearing upon published and mailed notice as required by law; and
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1 WIIEREAS, on this date, the City Council conducted a public hearing on the Tax
2 Increment Financing Plan and the Modificafion, after published notice thereof; and
3 WHEREAS, at said public hearing, the City Council heazd testimony from all interested
4 parties on the Tas Increment Financing Plan and the Modification.
NOW THEREFORE BE IT RESOLVED BY the City of Saint Paul, Minnesota as
follows:
7 Section 1. Findings for the Creation of the Modification of Redevelopment Plan and Tenth
8 and Jackson Street TaY Increment Distdct and Adoption of T� Increment Financing Plan
9 therefor.
10 1.01 The City Council hereby finds that the Modification, creation of the Tax
ll Increment District and adoption of the Tax Increment Financing Plan therefor, are intended and,
12 in the judgment of the City Councii, its effect will be, to carry out the objectives of the
13 Redevelopment Plan, as modified, and to create an impetus for the cleazance of blighted
14 structures and the construction of owner occupied housing facilities, and will otherwise promote
15 certain public purposes and accomplish certain objectives as specified in the Redevelopment
16 Plan, as modified, and TaY Increment Financing Plan.
17 1.02 The City Council hereby finds, in connection with the Modification of the
18 Redevelopment Plan that (a) the land to be added to the Project Area would not be made
19 available for redevelopment without the financial aid to be sought, (b} the Redevelopment Plan,
20 as modified, affords the maximum opportunity, consistent with the needs of the City of Saint
21 Paul as a whole, for the redevelopment of the azea by private enterprise, and (c) the
22 Redevelopment Plan, as modified, conforms to the general pian for the development of the City
23 as a whole.
24 1.03 The City Council hereby finds that the T� Increment District qualifies as a
25 "redevelopment district" within the meaning of the Tax Increment Act for the following reasons:
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The T� Increment District (the "District") is, pursuant to Minnesota
Statutes, Section 469.174, Subdivision 10(a)(1) and (3), a"redevelopment
district" because it consists of a project or portions of a project within which one
or more of the following conditions, reasonably distributed throughout the
District, exist: (a) pazcels consisting of at least 70% of the azea of the portion of
the District (the "Substandazd Building Pazcels") aze occupied by buildings,
streets, utiliries, paved or gravel parking lots, or other similaz structures; and (b)
more than 50% of the buildings not inciuding outbuildings, located within the
Substandard Building Pazcels of Tax Increment Financing District are
"shucturally substandard° (within the meaning of Minnesota Statutes, Secfion
469174, Subdivision 10(b)) to a degree requiring substantial renovation or
clearance. The building in the Tas Increment District is structurally substandard
because it contains defects in structural elements or a combination of deficiencies
in essential utilities and facilities, light and ventilation, fire protection including
adequate egress, layout and condition of interior partitions, or similaz factors,
which defects or deficiencies are of sufficient total significance to justify
substantial renovation or clearance. In addition, the costs of bringing the
structurally substandard building into compliance with building codes applicable
to new buildings would exceed 15% of the cost of constructing new structures of
the same size and type on the sites. The "sUucturally substandard" building is not
in compliance with the building code applicable to new buildings, and the costs of
modifying such building to satisfy the building code is more than 15 percent of the
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cost of constructing a new structure of the same squaze footage and type on the
site.
The reasons and supporting facts for these determinations aze set forth in a
report dated May 4, 2004 prepared by Short Elliot Hendrickson Inc., a copy of
which is on file with the Executive Airector of the HRA, and which is
incorporated herein by reference in its entirety.
The City Council hereby makes the following additional findings:
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(a) The City Council further finds tl�at the proposed development, in the
opinion of the City Council, would not occur solely through private investment within the
reasonably foreseeable future and, therefore, the use of tax increment financing is deemed
necessary. The specific basis for such fmding being:
The properry on which the development will occur would not be
developed in the reasonably foreseeable future because it has fragmented
ownership, contains a blighted building, and the property is polluted with
hazardous substances.
(b) 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 Tenth and Jackson Street Tax Increment Financing
District that could reasonabiy be expected to occur without the use of tax increment
financing is $0, which is less than the increased mazket value estimated to result from the
proposed development (i.e., $56,625,150) after subtracting the present value of the
projected taa� increments for the m�imum duration of the Tenth and Jackson Street Tax
Increment Financing District (i.e., $52,640,150). The current mazket value of the
property in the TaY Increment District is approximately $2,381,000, and with tas
increment financing the market value of the properiy will increase by $56,625,150 to
approximately $59,006,150. In making these findings, the City Council has noted that the
property has not been developed for many yeazs and would likely remain so if tax
increment financing is not available. Thus, the use of t� 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.
31 1.04 The City Council fiurther finds that the TaY Increment Financing Plan conforms to
32 the general plan for the deveiopment or redevelopment of the City as a whole. The T�
33 Increment Financing Plan will generally compliment and serve to implement policies adopted in
34 the City's comprehensive plan. The housing development contemplated by the TaY Increment
35 Financing Plan is in accordance with the sma11 azea plan adopted for the Project Area.
36 1.05 The City Council further finds that the Tax Increment Financing Plan will afford
37 maYimum opportunity consistent with the sound needs of the City as a whole for the
38 development of the Tax Increment Financing District by private enterprise. The specific basis for
39 such finding being:
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The proposed development to occur within the Tas Increment Financing District
is primazily owner occupied housing. The proposed development will increase
the taxable market valuation of the City and expand the available housing
facilities by approximately 259 units of owner occupied housing facilities.
44 1.06 The City elects the method of tax increment computation set forth in Minnesota
45 Statutes, Section 469.177, subd. 3(a).
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1 1.07 The provisions of this Section 1 aze hereby incorporated by reference into and
2 made a part of the Tas Increment Financing Plan. A copy of the T� Increment Financing Plan is
3 attached hereto as E�ibit A and is incorporated herein by reference in its entirety.
4 Section 2. Creation of the Tenth and Jackson Street Tas Increment Financing District,
5 Approval of the TaY Increment Financing Plan therefor and Modification of the Redevelopment
6 Plan. •
7 2.01 The creation of the Tenth and Jackson Street Tax Inerement Financing District
8 and the Tax Increment Financing Plan therefor aze hereby approved. The Modification and the
9 Tax Increment Financing Plan are hereby adopted, in the form on file with the Executive Director
10 of the HRA.
11 2.02 The stafF of the HRA and the IIItt1's advisors and legal counsel aze authorized and
12 directed to proceed with the implementation of the Tax Increment District and the Tax Increment
13 Financing Plan and for this purpose to negotiate, draft, prepaze and present to the Boazd of
14 Coznmissioners of the HRA for its consideration all further plans, resolutions, documents and
15 contracts necessary for this purpose.
Benanav
�lake�c sI'Idht�omFCy ✓
Bostrom � (/ �
Harris �
Helgen ,�
Lantry ,/
�ent Requested by Department of:
✓ t��ct �n crnG� ECriv�vvr+;L 1�2v210 w�,vii"
Bv: ��__
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Adopted by Co cil: Date i
Adoption Certi e� by Council Secr ary
Approved
By: __,
Date
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� Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet Green Sheet �
PE — Plarming&EconomicDevelopment ; 2�-�Y� ':. Green Sheet NO: 3017375
i Contact Person 8 Phone:
Dan Smith
66581
Must Be on Council Agenda by
�
Assign
Number
For
Routing
Order
0 '�lannioe & Economic Develon �,
1 launinc & Economic Develoo � Deoardnent Director � �/�S'
2 itv Attornev I I t
3 vor's Oflice I Mavor/Assistaut i
4 ou cil
5 ity Clerk Cih Clerk I
Total # of Signature Pages _(Clip All Locations for Signature)
Action Requested:
City Council Resolution approving the establishment of the Tenth and Jackson Street TaY Increment Financing District, approving a
tax increment financing plan and approving the modification of the redevelopment Plan for the North Quadrant Redevelopment Project
Area.
idations: Approve (A) or R
Planning Commission
CIB Committee
Civil Service Commission
1. Has this personlfirm ever worked under a contract for this department?
Yes No
2. Has this person/firm ever been a city employee?
Yes No
3. Does this person/firtn possess a skill not nortnally possessed by any
current city employee?
Yes No
Explain all yes answers on separate sheet and attach to green sheet
Initiating Problem, Issues, Opportunity (Who, What, When, Where, Why):
The HRA Board on May 12th authorized a Memorandum of Understanding with Real Estate Development Group regazding creation of
the Tenth/Jackson TIF district
AdvantapeslfApprovetl:
The IIItA will be able to move forward with creation of the TIF district. The HRA Boazd will retain final auffiority for creation of the
TIF district and approval of a TIF agreement or Development Agreement with the developer.
Disadvantaqes If Approved:
None.
DisadvanW ges If Not Approved:
The IiI2A Board will not be able to consider the Tenth and Jackson TIF District. ,_
�QFSP�rnE; P�rzn>
Transaction:
Fundinq Source:
(R): � Personal Service Contrects Must Answer the
CosURevenue Budgeted=
Activity Number:
�„ , ,, : , � , �. .�
Financial Information:
(F�cplain)
o�+-y�o
SECOND AMENDMENT OF REDEVELOPMENT PLAN FOR
THE NORTH QUADRANT REDEVELOPMENT PROJECT AREA
ORIGINAL APPROVAL BY THE SAINT PAUL PLANNING COMMISSION:
NLY 11, 1999
ORIGINAL APPROVAL BY THE HOUSING AND REDEVELOPMENT
AUTHORITY OF THE CITY OF SA1NT PAUL: JUNE 23, 1999
FIRST AMENDMENT APPROVAL: JUNE 14, 2002
BY THE SAINT PAUL PLANNING COMMISSION
FIRST AMENDMENT APPROVAL: JiJNE 26, 2002
BY THE HOUSING AND REDEVELOPMENT AUTHORITY
OF THE CTTY OF SAINT PAUL AND THE CITY OF SAINT PAUL
SECOND AMENDMENT APPROVAL: MAY 21, 2004
BY THE SAINT PAUL PLANNING COMMISSION
SECOND AMENDMENT APPROVAL: JUNE 9, 2004
BY THE HOUSING & REDEVELOPMENT AUTHORITY
OF THE CITY OF SAINT PAUL AND THE CITY OF SAINT PAUL
This document was drafted by:
BRIGGS AND MORGAN (KAL)
Professional Association
332 Minnesota Street
2200 West First National Bank Building
Saint Paul, Minnesota 55101
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SECOND AMENDMENT OF REDEVELOPMENT PLAN
FOR THE NORTH QUADRANT REDEVELOPMENT PROJECT AREA
SECTION 1. BACKGROUND
The Housing and Redevelopment Authority of the City of Saint Paul, Minnesota (the
"Authority") has heretofore established the North Quadrant Redevelopment Project Area (the
"Redevelopment Project P.sea") and adopted a Redevelopment Plan therefor (the
"Redevelopment Plan") pursuant to Minnesota Statutes, Sections 469.001 to 469.047 (the
"Housing and Redevelopment Authority Act"). An amendment to the Redevelopment Plan was
approved by the Saint Paul Planning Commission on June 14, 2002 and by the Authority on June
26, 2002 (the "First Amendment"). The purpose of the First Amendment was to enlarge the
Redevelopment Project Area to include additional property in the Redevelopment Project Area.
The purpose of this Second Amendment is to accommodate a proposal received by the
Authority to redevelop an azea located in the vicinity of the Redevelopment Project Area into an
owner-occupied housing and commercial development (the "Tenth and Jackson Street Project").
The proposal for the Tenth and Iackson Street Project requires the enlargement of the
Redevelopment Project Area and the creation of a separate tax increment financing district to
help fmance certain public redevelopment costs of the Tenth and Jackson Street Project.
SECTION 2. GENERAL DESCRIPTION OF SECOND AMENDMENT
This Second Amendment enlarges the Redevelopment Project Area to include additional
property in the Redevelopment Project Area.
SECTION 3. AMENDMENT
Section 3.1 Inclusion of Property from the Redevelopment Project Area.
The description of the Redevelopment Project Area is hereby amended to include the
following property:
See attached map as E�ibit A hereto.
Section 3.2 Effect of Amendments.
Except as herein amended and supplemented, the Redevelopment Plan remains in full
force and effect.
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EXHIBIT A
MAP OF INCLUDED PROPERTY
See attached.
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North Quadrant Redevelopment
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EXHIBIT A
Tax Increment Financing Plan
5ee attached.
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TAX INCREMENT FINANCIlVG PLAN
for the establishment of the
TENTH AND 7ACKSON STREET TAX INCREMENT FINANCING DISTRICT
(a redevelopment district)
HOUSING AND REDEVELOPMENT AUTHORITY OF THE
CITY OF SAINT PAUL
RAMSEY COUNTY
STATE OF MINNESOTA
Adopted:
This document was drafted by:
BRIGGS AND MORGAN (KAL)
Professional Association
2200 First Nationai Bank Bldg.
332 Minnesota Street
Saint Paul, MN 55101
(651)808-6536
2004
1590209v4
TABLE OF CONTENTS
(for reference purposes only)
TAX INCREMENT FINANCING PLAN
FOR THE TENTH AND JACKSON STREET TAX INCREMENT FINANCING DISTRICT
Page
Section 1 . ........................................................... Forward 1
Section 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Statutory Authority 1
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Statement of Objectives 1
.....
Section 4 . . . . . . . . . . . . . . . . . . . Redevelopment Plan Overview 2
.... ...................
Section 5 . . . . . . . . . . . . . . . . . . . . Parcels to be Included in Tax Increment Financing Distriet 2
Section 6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Parcels to be Acquired 2
Section 7 . ............................
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Development Activity in T� Increment Financing District for which Contracts have been Signed
3
Section 8. .. Other Specific bevetopment Expecfed to Occur within Tas Increment Financing 3
Section 9 . . . . . . . . . . . . . . . Estimated Cost of Project; Taac Increment Financing Plan Budget 3
Section 10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated Amount of Bonded Indebtedness 3
Section 11 . ................................................. SourcesofRevenue 4
Section 12 . ............. Estunated Captured T� Capacity and Estimate of Tax Increment 4
Secfion 13 . . . . . . . . . . . . . . . Type of Tax Increment Financing District 4
.................
Section 14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Duration of TaY Increment Financing District 5
Section 15 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated Impact on Other Taxing Jurisdictions 5
Section 16
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.. Modification of Tas Increment Financing District and/or Tax Increment Financing Plan 5
Section 17 . . . . . . . . . . . . . . . . . . . . . . . . . . Modifications to T� Increment Financing District 5
Section 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Admiuistrative Expenses 6
Section 19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Limitation of Increment 6
Section 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Use of Tas Increment 7
Section 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Notification of Prior Planned Improvements 8
Section 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Excess Tax Increments 8
SecYion 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Requirements for Agreements with Bevelopers 9
Section 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other L'unitations on the Use of Tas Increment 9
Section 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . County Road Costs 11
Section 26 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Assessment Agreements 11
Section 27 . . . . . . . . . . . . . . . . . . . . . Adminisiration of the 'Fa�c Increment Financing District 12
Section 28 . . . . . . . . . . . . . . . . . . . . . . . . . . Financial Reporting Requirements 12
..... .... ...
EXHIBIT A- PARCEL MAP OF TAX INCREMENT FINANCING DISTRICT ........ A-1
EXFIIBIT B - BUDGET .......................................................B-1
EXHIBIT C - CASH FLOW ...................................................C-1
EXI-IIBIT D - ESTIMATED IMPACT ON TAX BASE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-1
EXHIBIT E - REDEVELOPMENT ELIGIBILITY ASSESSMENT . . . . . . . . . . . . . . . . . . . . . E-1
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TAX INCREMENT FINANCING PLAN FOR
THE TENTH AND JACKSOI3 STREET TAX 1NCREMENT FINANCING DISTRICT
Section 1. Forwazd. The Housing and Redevelopment Authority of the City of Saint
Paul, Mimlesota (the "HRA"), and its stafF and consultants have prepazed the following
information for the establishment of a redevelopment tas increment fmancing district (the °TaY
Increment Financing District"). The Tas Increment Financing Disirict is located within the North
Quadrant Redevelopment Project Area heretofore established by the IIRA (the "Redevelopment
Project Area'').
Section 2. Statutory Authoritv. There exist azeas witlun the City of Saint Paul (the
"City") where public involvement is necessary to cause development to occur. To this end, the
HRA has certain statutory powers pursuant to Minnesota Statutes, Section 469.001 to 469.047
(the "HRA Law") and Minnesota Statutes, Section 469.174 through 4691799 (the °Tax
Increment Financing Act" or "TIF Act"}, to assist in financing public costs related to a
redevelopment project.
Section 3. Statemem of Objectives. The Tas Increment Financing District consists of
approxnnately 1.4 acres of land and adjacent and intemal rights-of-way. The T� Increment
Financmg District is being created to facilitate the redevelopment of an existing commercial
building and surface pazking lots by the construction of new facilities for commercial and owner-
occupied housing uses. The tax increment financing plan is expected ta achieve the objectives
autlined in the Redevelopment Plan for the Redevelopment Project Area. The following aze
some of the objectives bemg facilitated by the Tax Increment Financing Plan.
A. Provide Affordable Housing for Saint Paul Residents.
The available housing for residents in the Redevelopment Project Area will be expanded
when the appxoxirnately 259 units of owner-occupied housing (to be constructed in two phases)
and related parking facilities aze constructed. At least twelve of the housing units will be
affordable to persons whose incomes do not exceed fifty percent (50%) of area median income.
B. To Redevelop Underused Property and Remove Blight.
The Tax Increment Financing District currently contains property that has been
underutalized for many yeazs. In order to protect existing investment and encourage new
development in the area, remove and prevent the emergence of blight and blighting influences, a
substandazd building needs to be demolished and new facilities need to be constructed.
C. Expand the Tax Base of the City of Saint Paul.
It is expected that the tasable market value of parcels in the Tax Increment Financing
District will increase by approximately $56,625,950 as a result of the new development.
The activities contemplated in the Redevelopment Plan and this T� Increment Financing
Plan do not preclude the undertaking of other qualified development or redevelopment activities.
These activities are anficipated to occur over the life of the T� Increment Financing District and
the Redevelopment Project.
Section 4. Redevelopment Plan Overview.
Property to be Acquired — Any of or all of the property located within Tax
Increment Financing District or Redevelopment Project Area may be acquired by
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2. Relocation — to the extent required, complete relocarion services will be available
pursuant to Minnesota Statutes, Chapter 117 and other relevant state and federal
laws.
3. Upon approval of a developer's plan relating to a development and completion of
the necessary legal requirements, the HItA may sell or assist a developer with the
cost of acquisition of selected properties within T� Increment Financing District
or Redevelopment Project Area, or may lease land or facilities to a developer.
Section 5. Parcels to be Included in Tax Increment Financin District The following
pazcels located in the Crty of Saint Paul, Ramsey County, Minnesota are to be included in the
Tax Increment Financing District:
Including all adjacent public streets and rights of way.
*The pazcel bearing PID 31-29-22-43-0023 will be subdivided prior to certification of the
Tax Increment Financing District. Only the easterly portion of the parcel containing
approximately 314 acres, will be included in the Tax Increment Financing District. Ramsey
County will assign sepazate PID numbers to each of the new legal pazcels. A s�ap showing the
parcels or portions of pazcels to be included in the Tax Ittcrement Financing District is attached
as E�ibit A
FURTHER INFORMATION REGARDING THE IDENTIFICATION OF THE PARCELS TO
BE INCLUDED IN THE TAX INCREMENT FINANCING DISTRICT CAN BE OBTAINED
FROM TF� EXECUTIVE DIRECTOR OF TF� HRA.
Section 6. Pazcels to be Acquired. The HRA may finance all or a part of the costs of
acquisition of all or a portion of the pazcels_identified in Section 5 of this Tax Increment
Financing Plan. The HRA may use its powers of eminent domain to acquire pazcels which
cannot be obtained through private negotiation.
The IIRA may acquire properiy by gift, dedication or direct purchase from willing seilers
in order to achieve the objectives of the tax increment financing plan; and
Such acquisitions will be undertalcen only when there is assurance of funding to finance
the acquisition and related costs.
Section 7.
e neen �ignea. 1 he iotlowmg contracts have been or will be entered into by the
persons named below:
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The HRA has or will enter into a Development Agreement with Real Estate
Development Group (the "Developer"). The Developer has agreed that it will
construct a total of appro�mately 8,000 gross square feet of commerciaUretail
space (the "Commeicial Development"), approxisnately 259 units of owner-
occupied housing (the "Housing Development") and a new 252-space pazking
rasnp (the "Parking Ramp"). The Housing Development together with the
Commercial Aevelopment and the Pazking Ramp constitute the "Project." The
first phase of the Project ("Phase I") will consist of appro�nately 8,000 square
feet of Commercial Development, 129 housing units and a 252 space pazking
ramp. Phase I will have construcfion costs of approxixnately $31,594,180. The
I� expects Phase I to be completed by December 31, 2046. The second phase
of the Project ("Phase II") will consist of approximately 130 housing units and
will have consh costs of $31,354,800. The HRA expects Phase II to be
completed by December 31, 2007.
Section 8. Other Specific Development Expected to Occur within Tax Increment
Financin¢ District. The HFZA does not anticipate that other future development in the Tax
Increment Financing District will occur.
Section 9. Estimated Cost of Proiect; Tas Increment Financine Plan Budeet The HRA
has determined that it will be necessary to provide assistance far certain pubiic costs of the
Development. To facilitate the Development within the Tax Increment Financing District, this
Tas Increment Financing Plan autl�orizes the use of tax increment financing to pay for a portion
of the cost of certain eligible expenses. This Tax Increment Financing Plan also authorizes the
use of tax increments to pay for certain expenditures outside ihe Tas Increment Financing
District for certain low income rental housing pro}ects as authorized by Minnesota Statutes,
Section 469.1763, subd. 5. The estimate of public costs and uses of fuuds associated with Tas
Increment Financing District is outlined on Exhibit B.
Estimated costs associated with Tas Increment Financing District aze subject to change and may
be reallocated between line items by a resolution of the HI2 A. The cost of all activifies to be
financed by the tax increment will not exceed, without formal modification, the budget for the
tax increr.ents set fc;* � oz E�:b:t B .
Section 10. Estimated Amount of Bonded Indebtedness. The expenditures authorized by
this T� Increment Financing Plan may be paid for on a pay-as-you-go basis or by tax increment
revenue obligations. If bonded indebtedness is issued by the HRA or the City, the principal
amount is estimated not to exceed $5,000,000, including capitalized interest.
Section 11. Sources of Revenue. The costs outlined in Section 9 above will.be financed
on a pay as you-go basis through the annual collection of tax increments or by tax increment
revenue obligations. All other costs will be financed by private fmancing obtained by the
Developer. The Developer will obtain Department of Employment and Economic Development
clean-up funds in connection with the Pro�ect. The market value upon aompletion of Phase I of
the Commercial Development is estimated to be approximately $684,000. The mazket value
upon completion of Phase I of the Housing Development is estimated to be $27,271,600. The
mazket value upon completion of the Pazking Ramp is estanated to be $2,063,250. The mazket
value upon completion of Phase II of the Housing Development is estimated to be $28,987,300.
Section 12. Estunated Captured Tax Capacity and Estimate of Tax Increment. The most
recent tax capacity of Tax Increment Financing District is estimated to be $41,634 as of January
2, 2004. The estunated captured t� capacity of Tax Increment Financing District at completion
of Phase I is estimated to be $299,098 and upon completion of Phase II is estimated to be
$588,971.
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The HRA elects to retain all of the captured tax capacity to fmance the cbsts of Ta�c
Increment Financing District. The HRA elects the method of tax increment computation set forth
in Minnesota Statutes, Section 469.177, subd. 3(a).
Section 13. Tvpe of T� Increment Financing District The Tax Increment Financing
District is a redevelopment district established, pursuant to Minnesota Statutes, Section 469.174,
Subd. 10. In order to qualify as a"redevelopment districY', pazcels consisting of 70 percent of
the azea of the TaY Increment Financing District must be occupied by buildings, streets, utilities,
paved or gravel pazking lots, ar other similaz structures and more than 50 percent of the
buildings, not including outbuildings, aze structurally substandard to a degree requiring
substantial renovation or cleazance.
The Tax Increment Financing District contains eight pazceis. Ail of the parcels (100%)
aze occupied. There is one building in the Tax Increment Financing District, and that building is
s`uucturally substandazd. Pursuant to Mnuiesota Statutes, Secrion 469.174, subdivision 10(c), a
building is not structurally substandazd if it is in compliance with the building code applicable to
new biuldings or could be modified to satisfy the building code at a cost of less than 15 percent
of the wst of constructing a new structure of the same square footage and type on'the site. The
reasons and supporting facts for these determinations set forth in the Report dated May 4, 2004
prepazed by Short Elliot Hendrickson Inc., a copy of which is on file with the Executive Director
of the HRA and is attached as E�ibit E .
The IIILA and the City have deternuned that the proposed development within the T�
Increment Financing District would not reasonably be expected to occur solely through private
investment within the reasonably foreseeable future and that the increased mazket value of the
site that could reasonably be expected to occur without the use of ta�c increment financing would
be less than the increase m the mazket value estimated to resuit from the proposed development
after subtracting the present value of the projected taY increments for the maximum duration of
the Tax Increment Financing Disirict pernutted by the Ta�c Increment Financing Plan.
Secfion 14. Duration of Tas Increment Financinp District The dura6on of TaY
Increment Financing District,will be 25 years from the receipt of the first tax increment. The
date cf receipt of the first tax increment is expected to be the fi: st half of 2007. Attached as
E�ibit C is the projected receipt of tax increments from the Tax Increment Financing District.
Section 15. Estimated Impact on Other Taxin2 Jurisdicfions. If the construction within
the Tax Increment Financing Dishict would not have occurred without t� increment financing,
the impact is $0 to the other taYing jurisdictions. Notwithstanding the fact that the construction
would not have occurred without tax increment assistance, the estimated impact of TaY
Increment Financing District if the "but for" test was not inet is set forth on E�ibit D .
Secfion 16. Modification of Ta�c Increment Financing Distdct and/or Tax Increment
Financine Plan. No modificahons to Tas Increment Financing District or the Tax Increment
Financing Plan have been made as of the date hereof.
Section 17. Modifications to Tax Increment Financing District.
In accordance with Miimesota Statutes, Section 469.175, Subd. 4, any:
reduction or enlazgement of the geographie azea of the Ta�c Increment Financing
District;
2. increase in amount of bonded indebtedness to be incurred, inciuding a
detenninarion to capitalize interest on debt if that detennina.tion was not a part of
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the original pian, or to increase or decrease the amount of interest on the debt to
be capitalized;
increase in the portion of the captured net t� capacity to be retained b}• the FIRA;
4. increase in total estimated taY increment expenditures; or
5. desi�ation of additional properiy to be acquired by the I3RA,
shall be approved upon notice and after the discussion, public hearing and findings required for
approval of the original Tax Increment Financing Plan.
The geographic area of the Tax Increment Financing District may be reduced, but shall not be
enlarged after five yeazs following the date of certification of the original net taY capacity by the
County Auditor. The requirements of this pazagraph do not apply if (1) the only modification is
elimination of parcel(s) from the Tax Increment Financing District, and (2 j(A) the current net tas
capacity of the parcel(s) eliminated from the Tas Increment Financing District equals or exceeds
the net tax capacity of those parcel(s) in the 'Fax Increment Financing DistricYs original net tax
capacity, or (B) the HRA agrees that, notwithstanding Minnesota Statutes, Section 4b9.177,
Subd. 1, the original net ta�c capacity will be reduced by no more than the current net tax capaciTy
of the parcel(s) eliminated from the T� Increment Financing District.
The HRA must notify the County Auditor of any modification that reduces or enlazges the
geographic azea of the Taac Increment Financing District ar the Redevelopment Project Area.
Modifications to Tax Increment Financing District in the form of a budget modification or an
expansion of the boundaries will be recorded in the Tax Increment Financing Plan.
Section 18. Administrative Expenses.
In accordance with Minnesota Statutes, Section 469.174, Subd. 14, and Minnesota
Statutes, Section 469.176, Subd. 3, administrative expenses means a11 expenditures of the I3RA,
other than:
l. amounts paid for the purchase of land or amounts paid to contractors or others
providing materials and services, including azchitectural 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
located in the district; or
amounts used to pay interest on, fund a reserve for, or sell at a discount bonds
issued pursuant to Minnesota Statutes, Section 469.178.
Administrative expenses also include amounts paid for services provided bq 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 Taac
Increment Financing District up to but not to exceed 10 percent of the total tax increment
expenditures authorized by Uus TaY Increment Financing Plan or the total tas increment
expenditures, whichever is less.
Pursuant to Minnesota Statutes, Section 469.176, Subd. 4h, tax increments may be used
to pay for the county's actual administrative expenses incurred in connecfion with the TaY
Increment Financing District. The county may require payment of those expenses by February 15
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of the yeaz following the yeaz the expenses were incurred.
Pursuant to Minuesota Statutes, Section 469.177, Subd. 11, the county treasurer shall
deduct an amount equal to approxisnately .50 percent of any t� increment dish�ibuYed Yo the
HRA and the county tteasurer shall pay the aznount 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
tazc increment financing informafion and the cost of exainining and auditing authorities' use of
tax increment financing.
Section 19. Limitafion of Increment.
Pursuant to Minnesota Statutes, Section 469.176, Subd. 1(a), no t� increment sha11 be
paid to the E3F2A for the Tax Increment Financing District after three (3) yeazs from the date of
certification of the original net taY capacity vaiue of the ta�cable properry in the Tas Increment
Financing District by the County Auditor unless within the three (3) yeaz period:
(1) bonds have been issued pursuant to Miunesota 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
(2) the HRA has acquired property within the Tax Increment
Financittg District, or
(3) the HRA has constructed or caused to be constructed public
improvements within the Tax Increment Financing District.
The tas increment pledged to the payment of bonds and interest thereon may be
dischazged and may be temunated if sufficient funds have been irrevocably deposited in the debt
service fund or other escrow account held in trust for a11 outstanding bonds to provide for the
payment of the bonds at maturity or redemption date.
Pursuant to Minuesota Statutes, Section 469.176, Subd. 6:
if after four yeazs from the date of certification of the original net tax capacity of
the tas increment financing district pursuant to Miunesota Statutes, Section
469.177, no demolition, rehabilitation or renovation of property or other site
preparation, including qualified impmvement of a street adjacent to a parcel but
not installation of utility sarvice including sewet or water systems, has been
commenced on a pazcel located within a taY increment financing district by the
authority or by the owner of the pazcel in accordance with the tax increment
financing plan, no additional tas increment may be taken from that parcel and the
original net tax capacity of that parcel shall be excluded from the original net taac
capacity of the taY increment financing district. If the authority or the owner of
the parcel subsequently commences demolition, rehabilitation or renovafion or
other site preparation on that pazcel including qualified improvement of a street
adjacent to that parcei, 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 t� capacity
of the tas increment financing district. The county auditor musf enforce the
provisions of this subdivision. For purposes of this subdivision, qualified
improvements of a street aze lunited to (1) constntction or opening of a new street,
(2) relocation of a street, and (3) substantial reconstruction or rebuilding of an
existing street.
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Section 20. Use of Tax Increment.
The I-IRA hereby determines that it will use one hundred percent (100%) of the captured
net tax capacity of taxable properry located in the Tas Increment Financing District for the
following purposes:
i. to finance, or otherwise pay the capital and admiuistration costs of the
Redevelopment Project Area pursuant to the Minnesota Statutes, Sections 469.001
to 469.047;
2. to pay for project costs as identified in the budget;
to fmance, or otherwise pay far other purposes as provided in Minnesota Statutes,
Section 469.176, Subd. 4;
4. to pay principai and interest on any loans, advances or other payments made to the
I-IRA or for the benefit of Redevelopment Project Area by the developer;
5. to finance or otherwise pay premiums and other costs for insurance, credit
enhancement, or other security guaranteeing the payment when due of principal
and interest on tax increment bonds or bonds issued pursuant to the T� Increment
Financing Plan or pursuant to Minnesota Statutes, Chapter 462C and Minnesota
Statutes, Sections 469.152 to 469.165, or both;
6. to accumulate or maintain a reserve securing the payment when due of the
principal and interest on the tax increment bonds or bonds issued pursuant to
Minnesota Statutes, Chapter 462C and Minnesota Statutes, Sections 469.152 to
469.165, or both; and
to return to other taxing jurisdictions.
These revenues shall not be used to circumvent any levy 1'unitations applicable to the
�iltA nor fo; other p by P�Iinnesota Statutes, Section 469.116, subd. 4.
Section 21. Nofification of Prior Planned Improvements.
The IiRA shall, after due and diligent search, accompany its request for certification to
the County Auditor or its notice of the Tas Increment Financing District enlargement with a
listing of all properties within the Tax Increment Financing District or area of enlargement for
which building permits ha�e been issued during the eighteen (18) months imxnediately preceding
approval of the Tax Increment Financing Plan by the municipality pursuant to Minnesota
Statutes, Section 469.175, Subd. 3. The CounTy Auditor shall increase the original value of the
Ta�c Increment Financing District by the value of improvements for which a building permit was
issued.
Section 22. 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 IIRA shall use the excess amount to do any of the following:
prepay any outstanding bonds;
1590209v4 7
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2. discharge the pledge of tax increment therefor;
pay into an escrow account dedicated to the payment of such bond; or
4. retum the excess to the County Auditor for redistribution to the respective taxing
jurisdictions in proportion to their local tax rates.
In addirion, the HRA may, subject to the limitations set forth herein, choose to modify the
Plan in order to finance additional public costs in the Tax Inerement Finaneing District or
Redevelopment Project Area.
Section 23. Requirements for Agreements with Developers.
The HRA will review any proposal for private deveIopment to detenni.ne its conformance
with the Redevelopment Plan and with applicable municipal ordinauces 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 pIan, and any other drawings or narrative deemed necessary by the
City to demonstrate the conformance of the development with city plans and ordinances. The
FIRA 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 pzoperty to be acquired in the Tas Increment Financing District as set forth in the
Tax Increment Financmg Plan shall at any time be owned by the HRA as a result of acquisifion
with the proceeds of bonds issued pursuant to Minnesota Statutes, Section 469.178, without the
IIIZA having, prior to acquisition in excess of 10 percent of the acreage, concluded an agreement
for the development or redevelopment of the properiy acquired and which provides recourse for
the F3I2A should the development or redevelopment not be completed.
Section 24. Other Limitations on the Use of Tax Increment.
General Limitations. All revenue derived from t� increment shall be used in
accordar,ce with the Tax Inc�ement F�ancing Plan. The revenues shall be used io
fittance, or otherwise pay the capital and admuiistration 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 buitding to be used
primarily and regulazly for conducting the business of a municipality, county,
school disttict, or any other local unit of govemment or the state or federal
government, or for a commons azea used as a public pazk, or a facility used for
social, recreation or conference purposes. This provision sha11 aot prohibit the use
of revenues derived from taY increments for the consiruction or renovation of a
pazking struchxre.
2. Certain Public Improvements. Ta�c increments may not be used to pay for the cost
of public 'vnprovements, equipment, or other items, if (i) the improvements,
equipment, or other items are located outside of the azea of the taY increment
financing district from which the increments were collected; and (ii) the
improvements, equipment, or other items that (a) primarily served a decorative or
aesthefic purpose, or (b) serve a functional purpose, but their cost is increased by
more than one hundred percent (100%) as a result of the selection of materials,
1590209v4
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design, or type as compazed with more commonly used materials, designs, or
types for similaz unprovements, equipment or items. The provisions of this
paragraph do not apply to expenditures related to the rehabilitation of historic
siructures that aze: (i} individually listed on the National Register of Historic
Places; or (ii) a contributing element to a historic district listed on the National
Register of I�istoric Places.
Redevel�menf Districts. At least 90 percent of the revenues derived from tax
inerements from a redevelopment district ot renewal and renovation disYrict must
be used to finance the cost of correcting conditions that allow designation of
redevelopment and renewal and renovation districts under Minnesota Statutes,
Section 469.174. These costs include, but are not limited to, acquiring properties
contaiiung struchually substandard buildings or improvements, or hazazdous
substances, pollution, or contaminarits, acquiring adjacent parcels necessary to
provide a site of sufficient size to permit development, demolition and
rehabilitation of structures, clearing the land, the removal of hazardous substances
or remediation necessary to development of the land, and installation of utilifies,
roads, sidewalks, and parking facilities for the site. The allocated administrative
expenses of the authority, including the cost of preparation of the development
action response plan, may be included in the qualifying costs.
4. Pooline Limitations. At least 75 percent of tas increments from the TaY
Increment Financing District must be expended on activities in the Tax Increment
Financing District or to pay bonds, to the extent that the proceeds of the bonds
were used to finance achvities within said district or to pay, or secure payment of,
debt service on credit enhanced bonds. Not more than 25 percent of said taa�
increments may be expended, through a development fund or otherwise, on
activities outside of the Tas Increment Financing District except to pay, or secure
payment of, debt service on credit enhanced bonds, provided that such 25 percent
may be increased by 10 percent as provided in pazagraph 6 below. Fox purposes
of applying this restriction, all admiivstrative expenses must be treated as if they
were solely for activities outside of the Tax Increment Financing District.
5. Five Yeaz Limitation on Commitment of Tax Increments. Tax increments derived
from the Tas Increment Financing District shall be deemed to have satisfied the
75 percent test set forth in paragraph 4 above only if the five year nile set forth in
Minnesota Statutes, Section 469.1763, Subd. 3, has been satisfied; and beginning
with the sixth year following certification of the Tax Increment Financing District,
75 percent of said tax increments that remain after expenditures pernutted under
said five year rule must be used only to pay previously commihnent expenditures
or credit enhanced bonds as more fully set fortki in Minnesota Statutes, Section
469.1'763, Subd. 5.
6. Expenditures Outside District. The Authority hereby elects to spend an additional
ten percent of the tax increments on activities located outside the Tax Increment
District as permitted by Minnesota Statutes, Section 469.1763, subd. 2(d)
provided that the expenditures meet the following requirements:
(1) they aze used exclusively to assist housing that meets the
requirements for a qualified low-income building as defined in Section 42 of the
Intemal Revenue Code of 1986, as amended (the "Code");
(2) they do not exceed the qualified basis of housing as defined under
Section 42(c) of the Code less the amount of any credit allowed under Section 42
1590209v4
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ofthe Code, and
(3) They aze used to (i) acquire and prepare the site for housing, (ii)
acquire, construct or zehabilitate the housing ar(ui) make public improvements
directly related to the housing.
Section 25. County Road Costs.
Pursuant to Minnesota Statutes, Section 469.175, Subd. la, the county boazd may require
the HRA to pay for all or part of the cost of county road improvements if, the proposed
development to be assisted by taY increment will, in the judgment of the county, substantially
increase the use of county roads requiring construction of road 'unprovements or other road costs
and if the road 'unprovements aze not scheduled within the next five years under a capital
improvement plan or other counry plan.
In the opinion of the HRA and consultants, the proposed development outlined in this
Plaa will have little or no impact upon county roads. If the county etects to use increments to
improve county roads, it must notify the IIRA within thiriy days of receipt of this Plan.
Section 26. Assessment Aa eements.
Pursuant to Minnesota Statutes, Secfion 469.177, Subd. 8, the HRA may enter into an
agreement in recordable form with the developer of property within the Tas Increment Financing
District which establishes a minunum mazket value of the land and completed improvements for
the duration of the Tas Increment Financing District. The assessment agreement sha11 be
presented to the assessor who shall review the plans and specifications for the unprovements
coustructed, review the market value previously assigned to the land upon which the
nnprovements are to be constructed and, so long as the minimum mazket value contained in the
assessment agreement appeaz, in the judgment of the assessor, to be a reasonable estimate, the
assessor may certify the muumum market value agreement.
Section 27. Admiuistration of the Tas Increment Financing District.
Administration of the Tax Increment Financing District will be handled by the Executive
D'uector of the EIRA.
Section 28. Financial Reporting Requirements.
The HRA will comply with all reporting requirements of Minnesota Statutes, Section
469.175, Subd. 5, 6 and 6a.
1590209v4 10
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1590209v4 A-1
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BUDGET
See attached.
1590209v4 B-1
• :�
TAX INCREMENT FINANCING PLAN BUDGET Exhibit B
Name of District: Tenth and Jackson
Type of District: Redevelopment District
Duration of District: 25 years following first collectio
Bridgecreek TIF Budget.xis 7/14/2004
1) Net of State Auditor Deduction
O� -S 8�c
I�1.i_1:3t1�[i
CASH FLOW
See attached. .
1590209v4 C-1
��-5�
Assum tions Re ort
City of Saint Paul PED, Minnesota
Tax increment Financing (Redevelopment) District No, x
Tenth/Jackson Project
Scenario A- 25 year district
Type of Tax Increment Financing District
Maximum Duration ofTIF District
Projected Certification Request Date
Decertification Date
Base Estimated Market Value
Original Net Tax Capacity
Redevelopmenf
25 years from 1 st increment
10/01/04
12/31/31 (25 Years of Increment)
2004/2005
$2,380,200
$27,812
AssessmenVCollection Year
Base Estimated Market Value
Increase in Estimatetl Market Value
Total Estimated Market Value
Total Net Tax Capaciry
0 0 9,005,645 38,715,006
$27,8'12 $27,812 $97,548 $413,872
City of Saint Paul gq, g�so�
Ramsey County 49255%
ISD #625 31.566°/a .
Othe� 6 034%
Local Tax Capacity Rate 122.070% 2003/2004
Fiscal Disparities Contribution From TIF District
Administrative Retainage Percent (maximum = 10%)
Pooling Percent
Note {pay-As-You-Go) - Phase I
Note Dated 10/01/04
Note Rate 6.00%
Note.Amount - Phase I $1,9g2,500
Present Value Date $ Rate
Notes
2004/2005 2005/2006 2006/2007 2007/2008
$2,380,200 $2,380,200 $2,380,200 $2,380,200
0 6 625 445 36 334 806
O.D000%
10.00%
10.00%
Note (Pay-As-You-Go) - Phase II
Note Dated 10/01/05
Note Rate 6.00%
Note Amount- Phase II $1,992,500
10/Ol/04 6.00%
Preparetl by: Springstetl Incorporatetl (printetl 7/13/2004 4 7 2 pM Page 3 SAPED TIF 701h,lackson 077304.�sASSUmptions
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Pro'ected Pa -As-You-Go Note Re ort
City of Sai`rt Paul PED, Minnesota
Taz Increment Financing (Retlevelopmefrt) Oistrict No. x
TenthUackson Prqect
Phasel
NoteDate. tOfOtI04
NoteRate 6.00%
Amount 51992,500
Semi-Annuai Loan
NM Acauetl Balance
�ate Pnnapal Interest P& i Revenue Inleres[ Outstantling
02/01/OS 000 0.00 000 0.00 39,85000
OB/Oi/05 000 0.00 000 0.00 59,]]500
02/O1I06 0.00 0.00 0 00 0 00 59,775 00
OB/01/06 0.00 0 00 0 00 0 00 59,]]5.00
02/01/07 0.00 00� 0.00 000 59,7]5.00
08/Oi/07 000 26,27333 28.9333 28,27333 3150'1.67
02101/08 000 28,9333 28,273.33 28,2]3.33 3t,501.6]
OB/0'I/08 6148958 59,]]500 t21,26458 '12'1,264.58 0.00
02/01/09 63,33427 57,930.31 121,26458 121,264.58 00�
08/Oi/09 65,23930 56,030.28 121,26458 12'1,264.58 000
02/Oi/10 67,191.32 54,07326 121,26458 121,264.58 000
08101/t0 69,207.OG 52,05]52 '121,264.58 121,26458 0.00
02I01/11 �1,28328 49,98130 121,26458 121,26458 0.00
OB/01A'I �3,421]9 41,842.81 121,26458 121,26458 000
02/Oi/12 75,624.43 45,640.15 121,264.58 72126458 000
08/01/12 77,893.16 43,37142 121,264.58 121,26456 0.00
02101/13 80,2299G 41p3462 12�,264.58 121,26458 000
OB/01fi3 82,63685 38,627.73 121,264,58 121,264.58 000
02/OV�4 85,it596 36,14662 121,26456 12t,26458 000
OS/01/'IG 8],66944 33,59514 121,264.58 12t,26458 000
02I01/15 90,299.52 30,96506 121,264.58 121,26458 0.00
OBI01R5 93,00851 28,2560] 12'1,26458 121,26458 000
02/OVi6 95,79876 25,46562 121,2G458 121,26458 0.00
OB/07/i6 96,67273 22,591.85 i21,26458 121,26458 000
02/OV1� �01,63291 19,637.67 121,26456 12'1,26458 000
OS/OV17 104,681.89 16,58269 121,264.58 12t,26458 0,00
a2�01/'IB 10],822-35 13,44223 121,26458 12t,26458 000
OS/01/18 111,05702 10,20]SG 121,26458 121,264.58 000
02/01/19 114,388.]3 6,8]585 121,264.58 121,26458 000
OS/pi/19 114,806.20 3,44419 '118,250.39 it8,25039 0.00
ovovza o.ao 000 0.00 oao 000
osiovso o.00 000 0_00 000 000
ovovz� o.00 000 000 000 000
osioirzi oao oao 000 000 000
ovovzz o.00 000 000 oao 000
oerovzz o 00 0 0o a o0 0 00 0.00
02f01/23 000 000 000 000 000
OB/01/23 000 000 000 000 000
02/Ot/24 000 000 0�0 000 000
oaiovza o 00 0 00 0 00 0.00 0 00
ovovzs o 00 0 00 0 00 0 00 0 00
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08)0126 0 00 D.00 0.00 0 00 0 00
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oamvai o00 000 000 000 000
02/Ot/32 000 0.00 000 000 000
$�.992.500 $850.11787 $2.842.6t7.81 52.842,61781 5341.95334
Surylus Tax Incremenl 3,034,628.86
TotalNetRevenue $5,8]�,246.6]
7,992,50�.00
'1,992,50000
1,992,500.00
1,992,500.00
1,992,500 00
1,992,500 00
1,992,500 00
1,992,500 00
1,931,Ot042
'1,867,676 t 5
i eoz,aa�.es
1,735,250.53
1,666,0434]
1,594,]60'19
1 52'1,33842
1 445,]i399
1,367,820.83
1,287,590 87
1.204,954 02
1,119,83806
1 032,16662
941.869.10
848,860.59
753.061 83
654,389'10
552,�56 t9
448,0]430
340,251 95
229,19493
1'14,80620
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Pro'ected Pa -As-You-Go Note Re ort
C'M1y of Sai�rt Paut PEO, Minnesota
Taz increment Financing (Redevelopment) Dis4ict No. x
TerNJJackson Project
Phasell
NoteOate 10/01/OS
Note Rzte: 6 00%
Amount S'1992,500
Semi-Mnual �oan
Nel Accruetl Balance
Date Pnnapal Interest P 81 Revenue Interest Outstandmg
02l01/OS
08/O1105
02/O1/06
OB/01/O6
02/01/0]
oaiovo�
ozrovos
OB/01/OB
02/01/09
OB/01/09
ovov�o
O8/0I/10
oziov>>
OB/01/i i
02/01/12
OSIOt1�2
02/Ot/13
08/01/13
02/01I14
OB/Oi/14
ovovis
08/01/15
02/01/16
OB/Ot116
02/01/1]
OB/01/1�
02/01/18
08/09/18
02/0I/t9
OS/Otlt9
02/01120
OB/01120
ovovzi
oeroim
0210t122
OS/OV22
02/01123
aeioirza
oziovza
osioirza
oziovzs
OB/01/25
02/01126
OS/01/26
oziovz�
oaro�m
02/01/28
OB/0128
ovoirze
O8/0I/29
0210t/30
OB/O1/30
02/OV31
OBIOti31
02/01/32
0 00
0 00
0 00
0 00
0.00
o.00
0 00
0 00
0 00
s�,�so 00
ss,aaz.so
61,266 97
63,t04 98
64,99813
66,948 OB
68 955 52
71.02522
�3,155 9�
]5,350 65
]],6�1.1I
�9,939 51
82,337 69
8h 80] 82
87,352 O6
89,9]2.62
92.6]1.80
95,451 95
90,315 51
101,264 97
tOh 302 92
107,432 01
110,654 97
113.9]4 62
4,3]1 36
D 00
0 00
0 00
0 00
0 00
a o0
0 00
0 00
0 00
0 00
0 00
0 oa
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0.40
o.00
0 00
a 00
o ao
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0 DO
0.00
0 00
0 00
0 00
0 00
0 00
o.00
35,25].50
35,257 50
59,775 00
sa,oaz.so
5G,258 03
sn azo az
52,526 87
50,576.92
48,5G8 48
46,499 78
44,369.03
42,1]4 35
39,9t3 83
37,585 49
35,187 31
32,717 18
30,172 94
2� 552 38
24,853 20
22,073.05
19,209.49
16,260.03
13.222.08
io,osz ss
6,8]0 03
3,550 38
131 14
0 DO
0.00
0 00
0 00
0 00
0 00
o.00
0 00
0 00
0 00
0 00
0 00
a o0
0 00
0 00
0 00
0 00
a o0
0 00
000
0 00
0 00
0 00
0.00
0-00
0 00
0_00
35,257 50
35,25] 50
i n.szs o0
�n,szs.00
1 t],525 00
117 525 00
11�,52500
1�7,525.00
�}7 525 CO
117,525 00
i n5zs.00
i � ],525 00
117,52500
117,525 W
i n,szs.00
11] 525 00
117,525 00
11],52500
11�,52500
� 17,525 00
111.525.00
i n,szs,00
ti].525.00
i n,szs o0
117,525 00
11],525 00
4,502 50
o co
0.00
0.00
0 00
0 00
0 00
0 00
o ao
0 00
0.00
0 00
o ao
o.00
o.00
0 00
0 00
0 00
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0 00
0 00
$1992,500 $903,t1]50 $2,895,6t]50
0 DO
o.00
0 00
0 00
0 00
0 00
0.00
35,257 50
35,25] 50
i n,szs o0
n 7,szs o0
i i � szs.00
t 1],525 00
ti],52500
111,52500
it7,52500
11],525 00
i n,szs o0
117,52500
11 ],525 00
t 1�,525 00
i i �,s2s o0
1�752500
11],525.00
� 1 ],525 00
11],626A0
11�,525 00
11],525 00
a n,szs o0
117,525 00
i i �,szs ao
117,52500
11�,52500
4,50250
900
0.00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
a o0
o.00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
0.90
�9,]0000
59,]]500
59,P5 00
59,775.00
59,�]5 00
59,77500
59,]]500
24,51 ] 50
24,517 50
0 00
0 00
0 00
0 00
0.00
0 00
0 00
0 00
o.ao
0 00
0 00
0 00
o.00
D 00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
0 00
0 CO
0.00
0 00
0 OD
a o0
0 00
0 00
o.00
0 00
0 00
0 00
0 00
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0 00
0 00
0 00
o.00
0 00
0 CO
$2,895,61750 $48],38500
SurplusTazlncremerM1 2,581,o475o
Total Net Revenue 55,4]6,665 00
1,992,500 00
1,992,50000
1,992,50000
t 992,50000
t,992,5�000
1 992,50000
i,sez,soo.00
1,992,50000
�,992,50000
t,992,50000
1,934,]5000
�,s�s,zw so
1,814,00053
1 ]50,895.55
1,685,89] 42
'1,616.949 34
t,549,99282
1,4]8,96].60
1 4058t1 63
1,330,460 98
1,252,84981
1,t�2,910.30
�,oeqs�z si
1 005,764 79
918,412 �3
828,440 t 1
]35,768 31
640,316 36
5C2,000 85
440,]3588
336,432 96
zzs.000 ss
118,345 98
4,3]1 36
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Preparetl by SpnnBSted InmNOated (]R320�4) PaBe 10 SPPED TIF tONJackton �]t306 xlsLOan Pb 2
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��N IgiT � oy-5�p
Redevelopment Eligibility Assessment
Proposed St. Paul
TIF District
Saint Paul, MN
May 4, 2004
Prepared by:
Short Elliott I3endrickson, Inc. (SEH}
Butler Square Building, Suite 710C
I00 North 6`� Street
Minneapolis, MN 55403
SEH No. A-SPPED0402.00
� � '1
City of
St. Paul TIF District
May 4, 2004
PURPOSE
Short EIliott Hendrickson, Inc. (SEF� was hired by the City of St Paul Minnesota, to
survey and evaluate the properties within the proposed St. Paut Tas Increment Financing
(TIF) District . The proposed district is generaily located south of Jackson Street, north
of Robert Sueet, east of Tenth Street aud west of Ninth Sueet. The purpose of our work
was to independendy ascertain whether the qualification tests for ta�c increment
eligibility, as required under Minnesota Statute, could be met.
The findings and conclusions drawn herein are solely for the purpose of tax inerement
eligibility and aze not intended fo be used outside the scope of this assessment.
SCOPE OF WORK
The proposed district consists of 7 parcels comprised of the foilowing types of
improvements: 1 commerciat structure on I pareel, and 6 vacant parcels with onty
pazking improvements. Within the district are also several accessory structures — for the
purposes of this assessment, these are considered `outbuildings' and are not inclnded in
ihe Condition of Buildings Test.
EVALUATIONS
An interior and exterior inspection was completed for the building.
FINDINGS
Coverage Test — 7 of the 7 properties met the coverage test with a 100% area coverage.
This exceeds the 7Q% azea coverage requirement.
Condition of Buildings Test — the building was found to be "structuraily substandard"
when considering code deficiencies and other @eficiencies of sufficient totat signifcance
to justify substantiat renovation or clearance (see definition of "structurally substandard"
as follows). This exceeds the Condition of Buildings Test whereby over 50% of
buildings, not incIuding outbuildings, must be found "shucturally substandazd."
CONClUSION
Our surveying and evatuating of the properties within this proposed Redevelopment
District render results that in our professional opinion qnalify the district eligible under
the statutory criteria and formnlas for a RedevelopmenY Tax Increment Financing District
(State Statute 469.174 Snbd. 10).
SUPPORTlNG DOCUMENTS ATTACHED
- Site Occupied/Building Substandard Determination table
♦ `�
'TIF Assessment maps: Buildings Under Study, Occupied Surfaces, Percent
Occupied
Report on Building Condition (one per building)
Individual Building Summary Report (one per building)
PROCEDURAL REQUIREMENTS
The properties were surveyed and evaluated in accordance with the following
requirements under Minnesota Statute Section 469.I74, Subdivision 10, clause (c) which
states:
Interior Inspection —"The municipaliry may not make sueh determination [that the
building is structurally substandazd] without an interior inspection of the property..."
Exterior Inspection and Other Means —"An interior inspection of the property is not
required, if the municipality finds that (1) the municipality or authority is unable to gain
access to the groperty; and after using its best efforts to obtain permission from the party
that owns or controls the property; and (2) the evidence otherwise supports a reasonable
conclusion that the building is structuraily substandard."
Docu�nentation —"Written documentation of the building findings and reasons why an
interior inspection was not conducted must be made and retained under section 469.175,
subdivision 3, clause (i) " Refer to attached Exhibit A— Documentation of
ContactsBvaluations for documentation for these purposes.
PROCEDURES FOLlOWED TO MEET REQUIREMENTS
The City of St. Paal sent a Ietter to the property owner located in the district requesting
that an inspection and evaIuation be made of their property. SEH conducted the
assessment on Apri17, 2004.
Requests for evatuation appointments were made with the building owner or building
tenants. An interior inspecrion and evaluation was completed if consented to by ttte
owner. An exteriar inspection and evaluarion was made where the owner refused interior
access to their property. In alT cases, an exterior evaluation was completed.
For the sub}ect building, the City of St. Paul provided informarion for review by SEH.
Additional huilding data was coIlected from gublic taspayer information available from
Ramsey Connty. Building data from these public records was eombined with and
reviewed against information gathered in the fieid.
QUALIFICATION RE(�UIREMENTS
The properties were surveyed and evaluated to ascertain whether the qualificauon tests
for taJC increment eIigibility for a redeveiopment district, required under the following
Min�esota Statutes, could be met.
3
b�f
Minnesota 3tatute Section 469.174, Subdivision 10, clause (a) (1) requires two tests for
occupied parcels:
1_ Coverage Test —"pazcefs consisting of 70 percent of the azea of the district are
occupied by buildings, streets, utiliries, paved or gravel pazking Iots or similaz
stiuctares . . ."
Note: The coverage required by the pazcel to be considered occupied is defined under
Minnesota Statute Section 469.174, Subdivision 10, clause (e) which states. "For
purposes of this subdivision, a pazce} is not occupied by buildings, streets, utilities,
paved or gravel parking lots or other similar structures unless 15% of the area of the
parcel contains buiidings, streets, utilities, paved or gravel pazking lots or other
similar structures."
2. Condition of Buildings Tesf —".., and more than 50 percent of the buildings, not
including outbuildings, are structurally substandard to a degree reqniring substanrial
renovation or cleazance;"
The term `structurally substandard', as used in the preceding paragraph, is defined by
a two-step test:
Coadifions Test: Under the tax increment law, specifically, Minnesota Statutes,
Section 469.174, Subdivision 10, clause (b), a building is structnrally
substandard if it contains "defects in stnictural eIements or a combination of
deficiancies in essentiai utilities and facilities, light and Venti2ation, fire protection
including adequate egress, layaut and condition of interior partitions, or sunilar
factors, which defects or deficiencies are of sufficient totaI significance to justify
substantiai renovation or cIearance."
Code Test: Notwithstanding the foregoing, the tas increment law, specifically,
Minnesota Statutes, Section 469.174, Subd'tvision 10, clause (cj also provides that
a building may not be considered structuraily substandazd if it: ". .. is in
compliance with bttilding code app�icabte to new buildings or couId be modified
to satisfy the building code at a cost of less than 15 percent of the cost of
constructing a new structure of the same square footage and type on the site."
Based on the above requirements, the substandard deterniination of a particular
building is a two-step process; therefore, the findings of each step are independent of
each other and both steps must be satisfied in order for a building to be faund -
structurally substandazd. It is not sufficient to conclude that a building is structurally
substandard solely because the Code Test is satisfied. It is theorztically possible for a
building to require extensive renovation in order to meet cunent building codes but
still not meet the main test of the Conditions Test.
Furthermore, deficiencies inctuded in the Conditions Test may or may not incIude
specific eode deficiencies as listed in the Code Test. In many cases, specific building
code deficiencies may weIl contribute to the data which supports satisfying the
��- 5 �
Conditions Test; conversely, it is certainly possible that identified hazards or other
deficiencies which could be incIuded in the Conditions Test do not necessarily
constitute current buiIding code defrciencies. By definition, the nature of ttte riuo
steps is sIighdy different. The Conditions Test is more subjecrive, whereas the Code
Test is an objective test. Conditions Test deficiencies aze less technical aztd not
necessarily measurable to the same extent of the code deficiencies in the Code Test.
To the end that technical, measurable bailding code deficiencies support the
sarisfaetion of the less technical Condifions Test, the following eode requirements are
defined'ut terms that go beyond the technicai requirements of the code and
demonstrate their relevance in terms of "... deficiencies in essentiat utiTities and
faciliries, light and ventilation, etc. .:'
Internationat Buiidin¢ Code (IBC)� The purpose of the IBC is to provide
minimum standards to safeguard gublic health, safety and general welfare through
structural strength, means of egress facilities, stability, sanitation, adequate light
and ventilafion, energy conservation, and safety to life and property from fire and
other hazards atiributed to the built enviroiunent (IBC 1013). A deficiency in tne
buiiding code (insufficient number of building e�ts, insufficient door landing
area, etc.) adversely affects one or more of the above standards to safeguard
`public health ._.and safety to life'; therefore, a deficiency in the building code is
considered a deficiency in one or more "essentiat utilities and facilities, light, and
ventilarion, etc:'. ,
Minnesota Accessibilitv Code Chapter 1341 � This chapter sets the requirements
for accessibility all building occupancies. The Minnesota Accessibility Code
closely follows the Americans with Disabilities Act Accessibility Guidelines
(ADAAG), which sets the guidelines for accessibi&ty to places of pubTic
accommodations and commerciat facilities as required by the Americans with
Disabilities Act (ADA) of 1990. The ADA is a federal anti-discrimination statnte
designed to remove barriers that prevent qualified individuals with disabilities
from enjoying the sazne opportunities that are availabie to persons without
disabilities (ADA Handbook). Essentially, a deficiency in the accessibility code
(Iack of handrai3 extension at stairs or ramp, lack of cIeazance at a toilet fixture,
etc.) results in a discrimination against disabTed individuals; therefore, a
deficiency in the accessibility code is considered a deficiency in "essential
utilaties and facilities".
Minnesota Food Cade Chapter 4626• This chapter is enforced by the Minnesota
Department of Health and is siarilar to the IBC in that it provides minimum
standazds to safeguard pablic health in areas of public/commercial Pood
prepazation. A deficiency in the food code (lack of non-absarbent walI or ceiling
finishes, lack of hand sink, etc.) causes a condition for potentiai contamination of
food; therefore, a defxciency in ihe food code is considered a deficiency in
"essential utilities and facilities".
05�-5�4
National Electric Code (1�iEC)� The puzpose of the NEC is the practical
safeguazding of persons and property from hazards atising from the use of
electricity. "£he NEC contains provisions that aze considered necessary for safety
(NEC 9d-1 (a) and (b)). A deficiency in the electric code (insufficient electrical
service capacity, improper wiring, etc.) causes a hazard from the use of
electriciiy; therefore, a defciency in the electric code is considered a defciency in
"essentiai utilities and facilities".
Internationai Mechanical Code (IMC)� The purpose of the IMC is to provide
minimum standards to safeguazd Iife or limb, heaIth, property and publie welfare
by regulating and controlIing the design, construction, instalIatioa, quaiity of
materials, location, operation, and maintenance or use of inechanicai systems
(IMC 1013). The IMC sets specific requirements for building ventilafion,
exhaust, intake and relief. These requirements transIate into a specified number
of compiete clean air exchanges for a building based on its,occupancy type and
occupant load. A deficiency in the mechanical code adversely affects the `health .
.. and public welfaze' of a building's occupants; therefore, a deficiency in the
mechanical code is considered a deficiency in "Iight and ventiIation".
Note: The above list represents some of the more common potential code
deficiencies considered in the assessment of the buildings in the proposed district.
This list does not necessarily include every factor incInded in the data used to
satisfy the conditions test for a particular building. Refer to individual building
reports for specific findings.
FinalIy, the tax increment law provides that the municipatity may find that a buiiding
is not dis4ualified as structuraliy substandard under the Code Test on the basis of
"reasonably available evidence, such as the size, type, and age of the building, the
average cost of plumbing, electrical, or structural repairs, or other similaz reIiable
evidence. Items of evidence that support such a conclusion [that the building is
structurally substandard] incIude recent fire or police inspections, on-site property
appraisals or housing inspections, exterior evidence of dete�ioration, or other similaz
reliable evidence."
MEASUREMENTS AGAINST TECHNICAL TEST REQUIREMENTS
Coverage Test
SEH utilized a GIS (Geographic Information Systems) system database, available
through Ramsey County and the City of 3t. Paul, to obtain individnai pazcei information.
The GIS system contains graphic information (pazcel shapes) and numerical data based
on county tax records. This information was used by SIIi for the purposes of this
assessment.
The total square foot area of each property pazcel was obtained from county records
(GIS) and genera( site verification.
0
.� i
The total extent of site improvements on each property parcel was digitized from recent
aerial photography (Spring, 2000). The totai squaze footage of site improvements was
then digitally measured and confirmed by general site verification.
The total percentage of coverage of eaeh property parcel was computed to determine if
the 15% reqnirement was met. Refer to attached maps: Occnpied Surfaces map and "
Percent Occupied map.
The total area of all qualifying properiy parcels was compared to the total area of alI
parcels to deterFnine if the 70% requirement was met. The area occupied by public
rights-of-way has not been considered in the coverage test calcalations. AII of Ehe pubIic
rights-of-way are improved. If all of the public rights-of-way were treated as a parcel for
the purpose of coverage test calculations, the 'IO% requirement of the coverage test would
still be met.
Condifion of Building Test
Replacement Cost — the cost of constructing a new structure of the same size and type on
site:
R. S. Means Square Foot Costs (2004) was used as the industry standard for base
cost catculations. R. S. Means is a nationally pubIished reference tool for
constivction cost data. The book is updated yearly and establishes a"nafional
average" for materiais and labor prices for all types of building construction. The
base costs derived from R. S. Means were reviewed, and modified if applicable,
against our professional judgment and experience.
A base cost was calculated by first establishing building type, builfling
construction type, and construction q_ualiry leveI (residen6al construction) to
obtain the appropriate Means cost per squaze foot. This cost was muttiplied times
the buiiding square footage to obtain the total replacement cost for an individual
building. Additionally, to account for regionaUlocal pricing, a cost factor was
added to the total cost according to R.S. Means tables. Using R. S. Means,
consideration is made for building occupancy, building size, and construction
type; iherefore, the cost per square foot used to construct a new structure will vary
accordingly.
BuiTdinQ Deficiencies: Condirions Test (Condirion Deficiencies) — determining the
combination of defects or deficiencies of sufficient total significance to justify substantial
renovarion or clearance.
On-Site evaluations - Evaluation of each building was made hy reviewing
available information from city records and making interior anc}/or exterior
evaluations, as noted, sometimes limited to public spaces. Deficiencies in
structural elements, essentiaI utilities and facilities, light and ventifation, fire
protection including adequate egress, layout and condition of interior partitions, or
similar factors, were noted by the evaluator. Condition Def ciencies may or may
• ;�
not include Code Deficiencies as defined beYow. Energy code compIiance was
not considered for the purposes of determining Condition Deficiencies.
Deficiencies were combined and summarized for each building in order to
determine their total significance.
Buildine Deficiencies: Code Test (Code Deficiencies) — determining technical conditions
that are not in compliance with curtent b�ilding code applicable to new buiidings and the
cost to correct the deficiencies:
On-Site evaluations - Evaluation of each building was made by reviewing
available informafion from city records and making interior and/or exterior
evalnations, as noted, sometimes limited to public spaces. On-site evatuations
were completed using a standard checklist format. The standard checklist was
derived from several standard building code plan review checklists and was
intended to address the most coaunon, easiIy identifiable code deficiencies.
Mechanical Engineers, Elechical Engineers_, and Building Code Officials were
aiso consutted in the development of the checklist.
Deficiencies were generally grouped into the following categories (category
names are followed by its appIicable building code):
• Building accessibility — Minnesota Accessibility Code
• BuiTding egress, building consuuction — International Building Code
• Fire protection systems — InternationaT Building Code
• Food service — Minnesota Food Code
• HVAC (heating, ventilating, and air conditioning) — Intemational
Mechanical Code
• EIectrical systems — National Electric Code and Minnesota Energy
Code
• Energy code compliance — MinnesoYa Energy Code
For the purposes of deternuning the Code Test (Code Deficiencies), Energy code
compliance is reIevant because its criteria affect the design of integrat garts of a
majority of a buiiding's systems. T'he intent of these critetia is to provide a means
for assuring building dtuabiIity, and perraitting energy efficient operation
(7676A100). The energy code addresses general building construction (all forms
of energy transmission in an exterior buiiding envelope — walls, roofs, doors and
windows, etc.) and energy usage by lighting and mechanicai systems. A
deficiency in the energy code (inadequate insulation, non-insulated window
systems, impropez air infiltration protection, etc.) reduces energy efficient
operation and adversely affects building system durability; therefore, a deficiency
in the energy code is considered to contribute to a condition requiring substantial
renovation or clearance.
Office evaluations — Following the on-site evaluation, each building was then
reviewed, based on on-site data, age of construetion, building usage and
occupancy, squaze footage, and known improvements (fmm building germit data),
• `�
and an assessment was made regarding compliance with current mechanical,
electricat, and energy codes. A basic code review was also completed regazding
the potential need for additional egress (basement stairways, for exampTe),
sprinkler systems, or elevators.
Deficiency Cost — Costs to correct idenfified deficiencies were deternvned by
using R. S. Means Cost Data and our professional judgment and experience. In
general, where several items of varying quality were available for selection to
conect a deficiency, an item of average cost was used, as appropriate for typical
commerciat or residential applications. Actuat construction costs aze affected by
many factors (bidding climate, size of project, etc.). Due to the nature of this
assessment, we were only able to generalize the scope of work for each
conection; that is to say that detailed plans, qnantities, and qualsties of materiaIs
were not possible to be known. Our approach to this matter was to deternune a
preliminary cost projection suitable to the level of detail that is known. This
process was similar to our typicat approach for a cost projection that may be given
to an owner during a schemaUc design stage of a project.
Costs to eorrect deficieneies were computed for each building and compared to
the building replacement cost to deternune if the 15% requirement was met.
The total number of buildings deternuned to be "structurally substandard" by satisfying
both the Conditions Test and the Code Test in this manner was compazed to the total
number of buiidings in the proposed disttict to deternvne if the 50% requirement was
met.
Reports on Building Condirions and Individual Building Summary Reports aze available
for review at the offices of SEH and the City of Saint Pau1.
Technical Condirions Resources — the following list represents the current building codes
applicable to new buildings used in the Building Deficiency review:
2003 Minnesota State Building Code
2000 Intemational Building Code
2000 International Aousing Code
MN 1341— Minnesota Accessibility Code, Chapter 1341 (1999)
2000 Minnesota Energy Code, Chapters 7672, 7674, or 7676
1999 National Electric Code
2000 Internarional Mechanical Code
PROJECT TEAM:
Leon A. Grothe, AIA, Project Architect
Steve Hack, Project �ngineer
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Report on Building Condition
Bailding II1Bosiness Name/Address: Firestone Bu�l�nQ, 49I Tackson 5-1
Satisfies Conditions Test for.Strucmrally Substandazd Building: y
Satisfies Code Test for Structural}y Subs[andazd Building:
Stt Snbstandard Bnilding (Yl1�:
Conditions Test
GI
Y
Under the tas increment faw, specificaIIy, Minnesota Statutes, Section 469.174, Svbdivision 10, a bui]ding is
sfn�cturally substandard if it contains "defects in shuctural eIements or a eombination of deficiencies in essential
u�l3ties and facilities, light and ventilauon, fire protection including adegvate egress, layout and condiaon of interior
partitions, or similaz factors, which defects or defrciencies are of su�cient totat signi5cance to jnsfify substanual
renovation orcIearance"
The above buSlding, based upon actuaI interior and exterior inspection and review of bu�lding permit records,
exhibits the following defrciencies that contribute to justifying substantial renovatiott or deazance:
Structural Elements
• Defects in exterior building shell: cracks in exterior concrete block wal}, along grout Iines and t}uovgh
concrete blocks; concxete block chipped in several areas and spaIling along grade.
Essential Utilities & Faciliaes
• Deficient in facililies for disabled: lack of maneuvering cleara�ce at interior doors; Iack of
maneuvering clearance and accessible features in toilet room; lack of accessible counter height in
cus[omec service azea,
Light & Ventilation
• Deficient in meeung Mechanicat code: for buildinL construction prior to 1989, mechattical systems do
not provide su�cient number of air exchanges.
• Deficient in meeting $]ectrical code: for building consu uction prior to 1980, receptacie locations,
receptac]e types, and wiring are non-compliant with c�srent bvilding code.
Fire Protection/Egress
• Deficient interior s[aix�vay: deficient rise/run dimensions, headroom height, handrail heights,
terminations, extensions and guazdrails.
LayoudCondition of Interior Paztiuons
• Toiletfkocker roam lacks sufScient room for employees to change clothes.
Similaz Factors
• Defects in exterior building shell: deteriorating metal door frames and door, chipped and peeling paint
on steeI columns between overhead doors.
• Defects in interior: deteriorating door fiame and door at floor level:
Code Test
Notwid�standing the foregoing, the ta�c increment ]aw also provides t6at a bvilding may not be consadered
structurally substandard if it is in compliance with the building code applicable to new buildings or could be
modified to satisfy the current building code at a cost of less than 15% of the cost of constructing a new building of
the same squaze footage and rype on the same site.
Estimated cost of new building of same size and type (Total Replaeement Cost): $396,087.�0
Fsrimated cost of correction of code deficiencies (Totat Deficiency Cost): $94,249.32
Percentage of Code Deficiency to RepIacement Cost: 23_gpq
Refer to L�dividual Building Sammary Report for documentafion of specific code deficiencies.
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TAX INCREMENT FINANCING PLAN
for the establishment of the
TENTH AND J
I S�1 � I.YI � Ct 'l: � �► I ! ]
TAX INCREMENT FINANCING DISTRICT
�elopment district)
CITY OF S.
RAMSEY
STATE OF P
Adopted:
This document was drafted by:
T AUTHORITY OF THE
PAUL
I�1
BRIGGS AND MORGAN (KAL)
Professional Association
2200 First National Bank Bldg.
332 Minnesota Street
Saint Paul, MN 55101
(651)808-6536
,
`
,_
.
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TABLE OF CONTENTS
(for reference purposes only)
TAX TNCREMENT FINANCING PLAN
THE TENTH AND JACKSON STREET TAX INCREMENT FINANCING DISTRICT
Paee
Section 1 : . . . . . . . . . . . . . Forwardl
Section 2. Statutory Authorityl
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Statement of Objectivesl
Section 4. . Redevelopment Plan Overview2
..� ......................................
Section 5. ..... . . Pazcels to be Included in Tax Increment Financing District2
Section 6. . . . . .� . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Parcels to be Acquired2
�#ednp'inent Activi�,y in Tax Increment Financing District for which Contracts have been Signed
3 `�
Section 8. ... Other Sp�cific Development Expected to Occur within Tax Increment Financing3
Section 9 . . . . . . . . . . . . :�. . . . Estimated Cost of Project; Tas Increment Financing Plan Budget3
Section 10 . . . . . . . . . . . . .�;. . . . . . . . . . . . . . . . . . . Estnnated Amount of Bonded Indebtedness3
Section 11. � . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sources of Revenue4
Section 12 . . . . . . . . . . . . . . . �Estimated Captured Tas Capacity and Estimate of Tax Increment4
Section 13 . . . . . . . . . . . . . . . . .``� Type of Taat Increment Financing District4
Section 14 . . . . . . . . . . . . . . . . . �:, . . . . . . . . . . . Duration of T� Increment Financing District5
Section 15 . . . . . . . . . . . . . . . . . . . .� . . . . . . . . Estimated Impact on Other Taxing Jurisdictions5
Section ]C�odification of Tas Incremexnt Financing District and/or Tax Increment Financing P1an5
Section 17 . . . . . . . . . . . . . . . . . . . . . 4"� . . Modifications to Tax Increment Financin District5
g
Section 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Administrative Expenses6
Section 19 . . . . . . . . . . . . . . . . . . . . . . . . E.. . . . . . . . . . . . . . . . . . . . . . . Limitation of Increment6
Section 20 . . . . . . . . . . . . . . . . . . . . . . . . . `'�. . . . . . . . . . . . . . . . . . . . . . . . Use of Tas Increment7
Section 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . `.� . . . . Notification of Prior Planned Improvements8
Section 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . `.;. . . . . . . . . . . . . . . . . . . . Excess Tax Increments8
Section 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . : :F,Requirements for Agreements with Developers9
Section 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . bther Limitations on the Use of Tax Increment9
Section 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .'�: . . . . . . . . . . . . . . . . . . County Road Costsl l
�;
Section 26 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . �,. . . . . . . . . . . . . Assessment Agreementsl l
Section 27 . . . . . . . . . . . . . . . . . . . . . . Administration the Tax Increment Financing Districtl2
Section 28 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . o . . Financial Reporting Requirementsl2
EXHIBIT A- PARCEL MAP OF TAX INCREMENT FhNANCING DISTRICT ........ A-1
EXHIBIT B - BUDGET . . . . . . . . . . . . . . . . . . . . . . . . . . .`�. . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
EXHIBIT C - CASH FLOW . . . . . . . . . . . . . . . . . . . . . . . . �. . . . . . . . . . . . . . . . . . . . . . . . . . C-1
EXHIBIT D - ESTIMATED IMPACT ON TAX BASE . . . . .` :. . . . . . . . . . . . . . . . . . . . . . . . D-1
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TAX INCREMENT FINANCING PLAN FOR
THE TENTH AND JACK50N STREET TAX INCREMENT FINANCING DISTRICT
ection 1. Forward. The Housing and Redevelopment Authority of the City of Saint
Paul, M esota (the "HIZA"), and its staff and consultants have prepared the following
informatio for the establishment of a redevelopment tax increment financing district (the "TaY
Increment F cing District"). The Tas Increment Financing District is located within the North
Quadrant Redavelopment Project Area heretofore established by the F�RA (the "Redevelopment
Project Area").�
Section 2. atuto
°City") where public vo:
HRA has certain statut
(the "HRA Law") and M
Increment Financing Act"
redevelopment project.
y Authoritv. There exist areas within the City of Saint Paul (the
vement is necessary to cause development to occur. To this end, the
powers pursuant to Minnesota Statutes, Section 469.001 to 469.047
nesota Statutes, Section 469.174 through 469.1799 (the "Tax
o� "TIF Act"), to assist in fmancing public costs related to a
Section 3. Statement of b'ective;
approximately 1.4 acres of land an adjace
Financing District is being created to acili
building and surface parking lots by th co
occupied housing uses. The tax increme t
outlined in the Redevelopment Plan for tha
some of the objectives being facalitated by
The Tax Increment Financing District consists of
and internal rights-of-way. The Tax Increment
te the redevelopment of an existing commercial
�truction of new facilities for commercial and owner-
nancing plan is expected to achieve the objectives
tedevelopment Project Area. The foliowing are
[� Taac Increment Financing Plan.
A. Provide Affordable Housing for Paul Residents.
The available housing for residents in the R evelopment Project Area will be expanded
when the approximately 259 units of owner-occupie ousing (to be constructed in two phases)
and related parking facilities are constructed. At least elve of the housing units will be
affordable to persons whose incomes do not exceed fifty rcent (50%) of azea median income.
B. To Redevelop Underused Properry and Rem�o'�e Blight.
The Tax Increment Financing District currentiy contains ' roperty that has been
underutilized for many years. In order to protect existing investm t and encourage new
development in the area, remove and prevent the emergence of blig t and blighting influences, a
substandard building needs to be demolished and new facilities need p be constructed.
C. Expand the Tax Base of the City of Saint Paul.
It is expected that the taxable mazket value of parcels in the TaY Incre�ent Financing
District will increase by approximately $56,625,150 as a result of the new deve�lopment.
�.
The activities contemplated in the Redevelopment Plan and tlus Tax Increirient Financing
Plan do not preclude the undertaking of other qualified development or redevelopme�t activities.
These activities are anticipated to occur over the life of the T� Increment Financing District and
the Redevelopment Project.
`
Section 4. Redevelopment Plan Overview.
Property to be Acquired — Any of or all of the property located within Tax
Increment Financing District or Redevelopment Project Area may be acquired by
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2.
the I-IRf1.
Relocation — to the extent required, complete relocation services will be available
pursuant to Minnesota Statutes, Chapter 117 and other relevant state and federal
laws.
3. Upon approval of a developer's plan relating to a developanent and completion of
� the necessary legal requirements, the IIRA may sell or assist a developer with the
i cost of acquisition of selected properties within Tax Increment Financing District
�, or Redevelopment Project Area, or may lease land or facilities to a developer.
Sectioix Parcels to be Included in Taac Increment Financine District The following
parcels located ii�the City of Saint Paul, Ramsey County, Minnesota are to be included in the
Tas Increment Financin� District:
Including a11 adjacent public streets and riglits of way.
*The parcel bearing PID 31-29-22-43-0023 will be subdivided priar to certification of the
Tax Increment Financing District. Only the easferly portion of the parcel containing
approximately 314 acres, will be included in the Tax Increment Financing District. Ramsey
County will assign separate PID numbers to each o��t�he new legal parcels. A map showing the
parcels or portions of parcels to be included in the Ta� Financing District is attached
as Exhibit A. >�
FURTHER INFORMATION REGARDING THE IDENTI�'�ICATION OF THE PARCELS TO
BE INCLUDED IN THB TAX INCREMENT FINANCING�?ISTRICT CAN BE OBTAINED
FROM THE EXECUTIVE DIRECTOR OF THE HRA. '�,
Section 6. Parcels to be Ac uired. The HRA may finance all or a part of the costs of
acquisition of all ar a portion of the parceis identified in Section 5 of�his Tax Increment
Financing Plan. The HRA may use its powers of eminent domain to a�quire parcels which
cannot be obtained through private negotiation. '`
The HRA may acquire property by gift, dedication or direct purch�
in order to achieve the objectives of the t� increment financing plan; and
Such acquisitions will be undertaken only when there is assurance of
the acquisition and related costs.
Section 7. Development Act
ts have been Signed. The fo
id the persons named below:
contracts have been or will be entered
willing sellers
�g to finance
,�
v�sh
into bv the
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The HRA has or will enter into a Development Agreement with Real Estate
Development Group (the "Developer"). The Developer has agreed that it will
construct a total of appro�mately 8,000 gross square feet of commerciaUretail
space (the °Commercial DevelopmenY'), appro�mately 259 units of owner-
occupied housing (the "Housing Development") and a new 252-space pazking
ramp (the "Pazking Ramp"). The Housing Development together with the
Commercial Development and the Parking Rainp constitute the "Project." The
first phase of the Project ("Phase I") will consist of approximately 8,000 squaze
feet of Commercial Development, 129 housing units and a 252 space parking
ramp. Pl�ase I will have construction costs of approxunately $34,011,950. The
HRA expects Phase I to be completed by November, 2005. The second phase of
�ie Project ("Phase II") will consist of approximately 130 housing units and will
ha�e construction costs of $29,362,000. The HRA expects Phase II to be
cor�pleted by November 30, 2006.
Section 8. O�
Financing District. 7
Increment Financing
� does not anticipate that other future development in the
will occur.
Section 9. Estimated\Cost of Proiect; T� Increment Financin¢ Plan Budget The IIRA
has determined that it will be necessary to provide assistance for certain public costs of the
Development. To facilitate the 4 evelopment within the Tax Increment Financing District, this
Tax Increment Financing Plan au orizes the use of tax increment financing to pay for a portion
of the cost of certain eligible expen ` s. This Tax Increment Financing Plan also authorizes the
use of tax increments to pay for certa expenditures outside the Tax Increment Financing
District for certain low income rental h using projects as authorized by Minnesota Statutes,
Section 469.1763, subd. 5. The estimate f public costs and uses of funds associated with T�
Increment Financing District is outlined on�xhibit B.
Estimated costs associated with TaY Increment"�inancing Aistrict are subject to change and may
be reallocated between line items by a resoluhon�e HRA. The cost of all activities to be
financed by the tax increment will not exceed, with ut formal modification, the budget for the
tax increments set forth on E�ibit B.
Section 10. Estimated Amount of Bonded Indebt dness. The expenditures authorized by
this Tax Increment Financing Plan may be paid for on a pa�-as-you-go basis or by taY increment
revenue obligations. If bonded indebtedness is issued by the�RA or the City, the principal
amount is estimated not to exceed $5,000,000, including capita�zed interest.
Section 11. Sources of Revenue. The costs outlined in Section 9 above will be financed
on a pay as you go basis through the annual collection of t� increm�ents or by taY increment
revenue obligations. All other costs will be financed by private financ� g obtained by the
Developer. The Developer wiil obtain Department of Employment and�conomic Development
clean-up funds in connection with the Project. The market value upon co�letion of Phase I of
the Commercial Development is estimated to be approximately $684,000. T��e mazket value
upon completion of Phase I of the Housing Development is estimated to be $��271,600. The
market value upon completion of the Parking Ramp is estimated to be $2,063,259. The market
value upon completion of Phase II of the Housing Development is estimated to be�$28,987,300.
Section 12. Estimated Captured Tax Capacitv and Estimate of Tax Increment:\The most
recent tax capacity of Tax Increment Financing District is estimated to be $47,604 as o� anuary
2, 2004. The estimated captured taz� capacity of Tax IncremenY Financing District at co�erion
of Phase I is estimated to be $327,500 and upon completion of Phase II is estimated to be \
$617,500.
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The I3RA elects to retain all of the captured t� capacity to finance the costs of Taac
Increment Financing District. The I-IRA elects the method of taY increment computation set forth
in Minnesota Statutes, Section 469.177, subd. 3(a).
\ Section Li. Tvve of Tax Increment Financin�District The Tas Increment Financing
Distnst is a redevelopment district established, pursuant to Minnesota Statutes, Section 469.174,
Subd. 1�, In order to qualify as a"redevelopment district", parcels consisting of 70 percent of
the azea o�the Tax Increment Financing District must be occupied by buildings, streets, utilities,
paved or gra el pazking lots, or other similaz structures and more than 50 percent of the
buildings, no�cluding outbuildings, are structurally substandazd to a degree requiring
substantial renovation or cleazance.
The Tax Incre`t�ent Financing District contains eight parcels. All of the pazcels (100%)
aze occupied. There is o�ne building in the Tas Increment Financing District, and that building is
stnxcturally substandazd.lPursuant to Minnesota Statutes, Section 469.174, subdivision 10(c), a
building is not structurally s�bstandard if it is in compliance with the building code applicable to
new buildings or could be modified to satisfy the building code at a cost of less than 15 percent
of the cost of constructing a ne`�v structure of the same squaze footage and type on the site. The
reasons and supporting facts for these determinations set forth in the Report dated May 4, 2004
prepared by Short Elliot Hendrickson Inc, a copy of which is on file with the Executive Director
of the HRA. �
The HRA and the City have det��mined that the proposed development within the Tax
Increment Financing District would not r�asonably be expected to occur solely through private
investment within the reasonably foreseeatrl,e future and that the increased mazket value of the
site that could reasonably be expected to occra� without the use of tax increment financing would
be less than the increase in the market value est�mated to result from the proposed development
after subtracting the present value of the projecte�tas increments for the masimum duration of
the Tax Increment Financing District permitted by the Tax Increment Financing Plan.
Section 14. Duration of Tax Increment Financit�g District. The duration of Tax
Increment Financing District will be 25 years from the re`�eipt of the first tax increment. The
date of receipt of the first tax increment is expected to be t�e first half of 2007. Attached as
E�ibit C is the projected receipt of tax increments from the'�ax Increment Financing District.
Section 15. Estimated Impact on Other Tasin�Jurisdictions. If the construction within
the Tax Increment Financing District would not have occurred witl�out tax increment financing
the impact is $0 to the other taYing jurisdictions. Notwithstanding th fact that the construction
would not have occurred without tax increment assistance, the estima�e�d impact of Tax
Increment Financing District if the "but for" test was not met is set fortli��n Exhibit D.
Section 16. Modification of T� Increment Financin¢ District and/or Tax Increment
Financine Plan. No modifications to Tax Increment Financing District or the�.Tax Increment
Financing Plan have been made as of the date hereof. �
Section 17. Modifications to T� Increment Financing District.
In accardance with Minnesota Statutes, Section 469.175, Subd. 4, any:
1. reduction or enlazgement of the geographic area of the T� Increment
District;
increase in amount of bonded indebtedness to be incuned, including a
determination to capitalize interest on debt if that determination was not a part
1540204v4 4
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5.
the original plan, or to increase or decrease the amount of interest on the debt to
be capitalized;
increase in the portion of the captured net tax capacity to be retained by the IIRA;
increase in total estunated tax increment expenditures; or
designation of additional property to be acquired by the HRA,
shall be appro�d upon notice and after the discussion, public hearing and findings required for
approval of the ariginal Tax Increment Financing Plan.
The geographic areabf the T� Increment Financing District may be reduced, but shall not be
enlarged after five years following the date of certification of the original net taY capacity by the
County Auditor. The re�quirements of this pazagraph do not apply if (1) the only modification is
elimination of pazcel(s) fram the Tas Increment Financing District, and (2)(A) the current net tax
capacity of the parcel(s) eliiriinated from the Tax Increment Financing District equals or exceeds
the net tas capacity of those p�rcel(s) in the Tax Innrement Financing District's original net taY
capacity, or (B) the HRA agree� notwithstanding Minnesota Statutes, Section 469.177,
Subd. 1, the original net tax capaeity will be reduced by no more than the current net tax capacity
of the parcel(s) eliminated from the T� Increment Financing District.
,
The HRA must notify the County Auditor of any modification that reduces or enlarges the
geographic azea of the Tax Increment Fixiancing District or the Redevelopment Project Area.
Modifications to Tax Increment Financing,District in the form of a budget modification ar an
expansion of the boundaries will be recorded in the Tas Increment Financing Plan.
Section 18. Administrative Expenses. �`�.
5
In accardance 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 ariiounts paid to contractors or others
providing materials and services, including a'rchitectural and engineering services,
direcfly 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
located in the district; or
3. amounts used to pay interest on, fund a reserve for, or se1T �t 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. `�as increment
may be used to pay any authorized and documented administrative expenses for the Tax
Increment Pinancing District up to but not to exceed 10 percent of the total tax increrhent
expenditures authorized by this TaY Increment Financing Plan or the total tax incremei`�t
expenditures, whichever is less. `;�
Pursuant to Minnesota Statutes, Section 469.176, Subd. 4h, tax increments may be
to pay for the county's actual administrative expenses incurred in connection with the Tax
Increment Financing District. The county may require payment of those expenses by Feb�
1590209v4
p+�-y�0
of the yeaz following the yeaz the expenses were incurred.
Pursuant to Minnesota Statutes, Section 469.177, Subd. 11, the county treasurer shall
duct an amount equal to appro�mately .50 percent of any tax increment distributed to the
and the county treasurer sha11 pay the amount deducted to the state treasurer for deposit in
the s te general fund to be appropriated to the State Auditor for the cost of financial reporting of
taY inciement fmancing information and the cost of examining and auditing authorities' use of
taY incre�ent fmancing.
19. Limitation of Increment.
Pursuant Minnesota Statutes, Section 469.176, Subd. 1(a), no tax increment shali be
paid to the HRA f the Tax Increment Financing District after three (3) years from the date of
certification of the original net tax capacity value of the taxable properiy in the Tax Inerement
Financing District by fk�e County Auditor unless within the three (3) year period:
(1) `� bonds have been issued pursuant to Minnesota Statutes, Section
469.178, or xn,aid of a project pursuant to any other law, except revenue bonds
issued pursuan��to Minnesota Statutes, Sections 469152 to 469.165, or
(2) the'HRA has acquired property within the Ta� Increment
Financing District, br
(3) the HR 4�as constructed or caused to be constructed public
improvements within the�Tas Increment Financing District.
�t
l
The tax increment pledged to the paq�nent of bonds and interest thereon may be
dischazged and may be terminated if sufficieri'�,funds have been inevocably deposited in the debt
service fund or other escrow account held in tru5t for all outstanding bonds to provide for the
payment of the bonds at maturity or redemption ctate.
Pursuant to Minnesota Statutes, Section 469. P�'�6, Subd. 6:
if after four yeazs from the date of certification of�the original net tax capacity of
the tax increment financing district pursuant to Miii�esota Statutes, Section
469.177, no demolition, rehabilitation or renovation af property or other site
prepazation, including qualified improvement of a street,adjacent to a parcel but
not installation of utility service including sewer or watet has been
commenced on a parcel located within a t� increment finapcing district by the
authority or by the owner of the parcel in accordance with th`e,tax increment
financing plan, no additional taac increment may be taken from�hat parcel and the
original net tas capacity of that parcel shall be excluded from th�original net ta�c
capacity of the tax increment financing district. If the authority or`'qhe owner of
the parcel subsequently commences demolition, rehabilitation or renc�vation or
other site preparation on that parcel including qualified improvement of a street
adjacent to that parcel, in accordance with the tax increment financing p1an, the
autharity shall certify to the county auditor that the activity has commeneed and
the county auditor shall certify the net t� 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.
1590209v4
� �. �
Section 20. Use of Tas Increment.
The IIRA hereby determines that it will use one hundred percent (100%} of the captured
t� capacity of taxable property located in the Tas Increment Financing District for the
b�wing purposes:
to finance, or otherwise pay the capital and administration costs of the
Redevelopment Project Area pursuant to the Minnesota Statutes, Sections 469.001
to 469.047;
2. t�,pay for project costs as identified in the budget;
3. to firiance, or otherwise pay for other purposes as provided in Minnesota Statutes,
Section �469.176, Subd. 4;
4. to pay pri b}pal and interest on any loans, advances or other payments made to the
HRA or for the benefit of Redevelopment Project Area by the developer;
5. to finance or otlierwise pay premiums and other costs for insurance, credit
enhancement, ar o`t�er security guazanteeing the payment when due of principal
and interest on taY iitcrement bonds or bonds issued pursuant to the Tax Increment
Financing Plan or pur§uant to Minnesota Statutes, Chapter 462C and Minnesota
Statutes, Section"s 469.1`52 to 469165, or both;
6. to accumulate or maintain a'x�serve securing the payment when due of the
principal and interest on the tax,increment bonds or bonds issued pursuant to
Minnesota Statutes, Chapter 46� and Minnesota Statutes, Sections 469.152 to
469.165, or both; and �`
7. to return to other taxing jurisdictions. ,,
These revenues shall not be used to circumvent
HRA nor for other purposes prohibited by Minnesota S
Section 21. Notification of Prior Planned
levy limitations applicable to the
'es, Section 469.176, subd. 4.
The HRA shall, after due and diligent search, accompany its'�request for certification to
the County Auditor or its notice of the Tax Increment Financing Disti'�ct enlargement with a
listing of all pxoperties within the Tax Increment Financing District or a'�ea of enlargement for
which building permits have been issued during the eighteen (18) months'immediately preceding
approval of the Tas Increment Financing Plan by the municipality pursuant�ko Minnesota
Statutes, Section 469.175, Subd. 3. The County Auditor shall increase the original value of the
Tax Increment Financing District by the value of improvements for which a bui'fding permit was
issued. `,
Section 22. Excess TaY Increments.
''l
Pursuant to Minnesota Statutes, Section 469176, Subd 2, in any yeaz in which the�tax
increment exceeds the amount necessary to pay the costs authorized by the Plan, including Ehe
amount necessary to cancel any tax levy as provided in Minnesota Statutes, Section 475.61, '�-.
Subd. 3, the HRA sha11 use the excess amount to do any of the following: �`
,
1. prepay any outstanding bonds; �`�
�,
1590209v4 7 �'�
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2. dischazge the pledge of tas 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
jurisdicrions in proportion to their local tax rates.
I'r� addition, the IIRA may, subject to the lunitations set forth herein, choose to modify the
Plan in order to finance additional public costs in the Tas Increment Financing District or
Redevelopn�ent Project Area.
Requirements £or Agreements with Developers.
The HRA �ill review any proposal for private development to determine its conformance
with the Redevelopri�ent Plan and with applicable municipal ordinances and codes. To facilitate
this effort, the followiitg documents may be requested for review and approval: site plan,
conshuction, mechanica�, and electrical system drawings, landscaping plan, grading and storm
drainage plan, signage system plan, and any other drawings or narrative deemed necessary by the
City to demonstrate the con`formance of the development with city plans and ordinances. The
HRA may also use the agreei�ents 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 acqukred in the Tax Increment Financing District as set forth in the
Tax Increment Financing Plan shall'at any time be owned by the HKA as a result of acquisition
with the proceeds of bonds issued pur`suant 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 acyuired and which provides recourse for
the HRA should the development or redevelopment not be completed.
�
Section 24. Other Limitations on the �se of Ta�c Increment.
General Limitations All revenue`derived from tax increment shall be used in
accordance with the Tax Increment'�inancing Plan. The revenues shall be used to
finance, or otherwise pay the capital and administration costs of the
Redevelopment Project Area pursuant �o the Minnesota Statutes, Sections 469.124
to 469.134; ,
These revenues shall not be used to circumv�nt existing levy limit law. No
revenues derived from t� increment shall be used for the acquisition,
construction, renovation, operation or maintenance of a building to be used
primarily and regularly far conducring the busmes's �of a municipality, county,
school district, or any other local unit of governmenf or the state or federal
government, or for a commons area used as a public p'�rk, or a facility used for
social, recreation or conference purposes. This provision.shall not prohibit the use
of revenues derived from t� increments for the construcfion or renovation of a
parking structure. �
2. Certain Public Improvements. Tas increments may not be used�o pay for the cost
of public improvements, equipment, or other items, if (i) the imprdvements,
equipment, or other items are located outside of the area of the tax iiicrement
financing district from which the increments were collected; and (ii) t�e
improvements, equipment, or other items that (a) primazily served a decqrative ar
aesthetic purpose, or (b) serve a functional purpose, but their cost is increased by
more than one hundred percern (100%) as a result of the selection of materials,
1590209v4
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p�-tiqb
design, or type as compazed with more commonly used materials, designs, or
types for similar improvements, equipment or items. The provisions of this
paragraph do not apply to expenditures related to the rehabilitation of historic
structures that are: (i) individually listed on the National Register of Historic
Places; or (ii) a contdbuting element to a historic district listed on the National
Register of Aistoric Places.
3. `'� Redevelopment Districts. At least 90 percent of the revenues derived from taY
�`�ncrements from a redevelopment district or renewal and renovation district must
be used to finance the cost of correcfing conditions that allow designation of
red�velopment and renewal and renovation districts under Minnesota Statutes,
SectiOn 469.174. These costs include, but are not limited to, acquiring properties
contauii�g structurally substandard buildings or improvements, or hazardous
substances,, pollution, or contaminants, acquiring adjacent parcels necessary to
provide a site sufficient size to permit development, demolition and
rehabilitation of structures, clearing the land, the removal of hazazdous substances
or remediation iiecessary to development of the land, and installation of utilities,
roads, sidewalks, and parking facilities for the site. The allocated administrative
expenses of the autli�rity, including the cost of preparation of the development
action response plan, ixiay be included in the qualifying costs.
Pooling Litnitations. At least 75 percent of tax increments from the Tax
Increment Financing District,must be expended on activities in the TaY Increment
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 bdnds. Not more than 25 percent of said tax
increments may be expended, through a development fund or otherwise, on
activities outside of the Tas Incremerit• District except to pay, or secure
payment of, debt service on credit enhanped bonds, provided that such 25 percent
may be increased by 10 percent as provid`ed in paragraph 6 below. For purposes
of applying this restriction, ail administrative expenses must be treated as if they
were solely for activities outside of the Tas Increment Financing District.
',
Five Yeaz Limitation on Commitment of Tax Increments Tas increments derived
from the Tax Increment Financing District shall be'deemed to have satisfied the
75 percent test set forth in paragraph 4 above oniy ifthe five year rule set forth in
Minnesota Statutes, Section 469.1763, Subd. 3, has been satisfied; and beginning
with the sixth year following certification of the Tax Incl�ement Financing District,
75 percent of said tas increments that remain after expenditures permitted under
said five yeaz rule must be used only to pay previously commitment expenditures
or credit enhanced bonds as more fuliy set forth in Minnesota•Statutes, Section
4691763, Subd. 5. ' ,
6. �enditures Outside District. The Authority hereby elects to spend an additional
ten percent of the tax increments on activities located outside the Ta�,Increment
District as permitted by Minnesota Statutes, Section 469.1763, subd. Z��1)
provided that the expenditures meet the following requirements
(1) they aze used exclusively to assist housing that meets the
requirements for a qualified low-income building as defined in Section 42
Internal Revenue Code of 1986, as amended (the "Code");
(2) they do not exceed the qualified basis of housing as defined under
Section 42(c) of the Code less the amount of any credit allowed under Section 42
1590209v4
,�
�
,�
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of the Code, and
(3) They are used to (i) acquire and prepare the site for housing, (ii)
acquire, construct or rebabilitate the housing or (iii) make public improvements
duectly related to the housing.
25. County Road Costs.
Pursua�tlt to Minnesota Statutes, Section 469175, Subd. la, the county board may require
the HRA to pay �or all or part of the cost of county road improvements if, the proposed
development to be�assisted by tax increment will, in the judgment of the county, substantially
increase the use of ci>unty roads requiring construction of road improvements or other road costs
and if the road improve,�nents are not scheduled within the neat five years under a capital
improvement plan or ot1T�r county plan.
``
In the opinion of the'�IRA 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 riatify the HRA within thirty days of receipt of this Plan.
SecEion 26. Assessment Agteements.
�,
Pursuant to Minnesota Statutes,`Section 469.177, Subd. 8, the HRA 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 Tncrement Financing The assessment agreement shall be
presented to the assessor who sha11 review the plans and specifications for the improvements
constructed, review the market value previously assigned to the land upon which the
improvements are to be constructed and, so long as.the minimum market value contained in the
assessment agreement appear, in the judgment of the �ssessor, to be a reasonable estimate, the
assessor may certify the minimum market value agreeix�ent.
Section 27. Administration of the T� Increment Financing District.
Administration ofthe Tax Increment Financing District�will be handled by the Executive
Director of the HRA.
Section 28. Financial Reporting Requirements.
The HRA wi11 comply with all xeporting requuements of Minnesota Statutes, Section
469.175, Subd. 5, 6 and 6a. `�
��.
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1590209v4 10
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EXHIBIT A
I�Zy�IA�/��]�YIL���1►[ '�1�1►`If71 y1►/_��C�71`►ClJI][.�Y:7C�11
See attached.
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1590209v4 A-1
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Tag Increment Financing �
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1590209v4 B-1
EXHIBIT B
���f��
See attached.
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1
and Jackson Lofts Budget
Land ac4�isiton
Parking ra�,� construction
Soil Correcti� s
Residential Corlstruction
Retail constructi
Soft Costs
Financing costs
Developer profit
TOTAL COSTS
SOURCES
Unit Sales
Parking Sales
New Ramp Value
Retail Value
DEED clean-up funds
TIF Note
TOTALSOURCES
Phase Two
Land acquisition
Soil corrections
Residential Construction
Soft Costs
Developer Profit
TOTALCOSTS
FINAL SOURCES
Unit Sales
Parking Sales
DEED Clean-up funds
FINAL SOURCES
Combined Phase One and Two
USES
Land acquisition
Soil Corrections
New Ramp Construction
Residential Construction
Parking Construction
Retaii Construction
Soft Costs
Financing costs
Developer Profit
TOTAL USES
$2,125,000
$3,800,000
$1,386,301
$19,338,740
$478,800
$3,280,183
$1,743,750
$1, 859,176
$34,011,950
e• .��
$1,039,�t25
$3,985,OOD
$34,011,950
$0
$500,000
$19,338,740
$3,280,183
$6,243,377
$29,362,300
$26,707,300
$2,280,000
$375,000
$29, 362, 300
$2,125, 000
$1,886,301
$3,800,000
$34,117,480
$4,560,000
$478,800
$6,560,366
$1,743,750
$8,102,553
$63,374,250
'
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SOURCES
Unit Sales
�arking Sales
R�mp Value
Retail Value
.
TIF Ne�e
DEED �ean-�
TOTALSOUF
funds
$51,698,900
$4,560,000
$1,031,625
$684, 000
$3,985,000
$1,414,725
$63,374,250
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EXHIBIT C
CASH FLOW
See attached.
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1590209v4 C-1 \
Pssessetl Value (2004)
acity Rate EsL (Pay 2003)
Rate
�ou go rate/pz{e
S�ni-Mnuai
Periotl
Fiitivg
10/372004
&31/2CD5
10l312005
S�31f20p6
10f3tR006
5/37l20W
10f3120W
5�12008
t0731/200H
5/372009
1087/20�9
5/312010
tQ13120t0
5/312a11
10/3t20N
sn�rzoiz
10/37l20t2
5/31/2013
'IO131/2013
5/37Y1014
70/31/2014
5I3t2015
70/312015
5/372016
10�37l2016
513112�t7
70l31/201]
5/312018
70/312018
5/3120t9
10137/2019
sra�rzozo
t0/37/2020
5�31/2021
t0135Y21Yit
5/312022
t0@t2022
5/312023
t�l31YL023
Sf31/2024
70/3ifN24
5/31/2025
10l312025
5/d7/2026
10/3t/2026
5J31I2027
10l37/2027
513t/2028
10/37/2028
srairzazs
10/37/2029
513tf?A30
10f37/2030
srs�noai
10/31/2031
To�al
40,986
40.986
40,986
40.986
305,056
305,056
594,929
594.929
594.929
594,929
594,929
594,929
59q,929
594,929
sea,szs
594.929
594.929
594,929
594,929
594,929
594,929
594,929
594,929
594,929
594,929
594,929
594.929
594,929
594,929
594.929
594.929
594.929
594.929
594,929
594,929
594,929
594.929
594.929
599.929
594.929
594,929
594,929
594,929
594,929
594,929
594,929
594.929
594,929
594,929
594,929
594.929
594,929
ssa,szs
594,929
Less.
Origmal
NetTaz
Capaary
(3)
40,986
G0.986
40.986
�\ 4�.986
40.986
40.986
40,986
40,986
40.9%
40,986
40,986
40,986
40,986
40,98G
40,986
40,98G
40,986
ao,sas
40,965
40,986
40,96G
40,9Q6
40,986
40,986
40.98G
40,986
40.986
40.98G
40,986
40.986
40,986
40,986
40,986
40,966
^A.°R6
4
40,986
40,98G
40,986
40,966
40,986
40,986
40,986
40,986
40,966
40,986
40,966
40,986
40.986
40,966
40,986
40,98G
$2,086,800
127.813%
0.00 %
6.00%
Refai�.W Times Less: Less: Less' Semi-Mnual Semi-Mnua
Captured Tax SemMnnual StateAUd. Cowty Atlmirt NetTaz NetTas
NetTaz Capacily GiossTae DetlucGOn Atlmin Rerainage Increment Increment
Capacity Ra{e �naemern 036p% $2100/yr t0.00% 7-&9-�0 w/7,2pCR
0
0
0
0
0
0
264,070
264,070
553,9G3
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553.943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,943
553,9C3
553,9A3
12t.e13% 337,387
t278t3% 337.387
12'1.873% 337,381
t21813% 337,387
121.813% 337,387
72�.873h 337,387
121.873°b 337,387
129.813% 33],387.
t21873% 337.38].
127
727
12t
t21
12t
121
721
121
127
121
121 873h
127 813%
t21 813%
121 813%
121 813h
t21.873k
127 813%
721 613%
127 813%
t21 873%
121.813 h
t27813%
121 8t3%
121 813k
t21 8t3%
127.813%
121 873%
121813%
337,387
337.387
33�,387
33T,387
337,�7
337,387
337,387
337,381
337,38]
337.38]
337,38].
337,387
337,387.
337,387
337�387.
33],387
337,387
337,387
33],387
337,38]
337,387
331,387
337,38]
337,38]
337,387
0.00
O.W
0.00
0.00
0.00
5]9.01
5]9.Ot
7,21459
1.2t4.59
t,21459
1,2t4.59
7.274.59
1,2tA.59
1,214 59
7,21459
1,214.59
t,214 59
1,214.59
1,274 59
7,274.59
1.214.59
t.214 59
1,274.59
t,21459
1.2t4.59
7.214 59
1.274.59
t,214 59
1,274.59
t.214.59
1,274.59
1.21459
�21459
7.214 59
t,25-0.59
1,214 59
1,21459
7.214.59
1,2t4,59
7.214.59
1,27459
t,214.59
7.214.59
1.214.59
t,274.59
1.21459
7.214.59
t,2t459
1.214.59
1,21459
Spiros S.�ds Prepared by pED
0.00
0.00
0.00
OW
0.00
1 O5p 00
�,050. W
1,050.00
i
1,050.00
1.050.00
1,050.00
i.ow o0
I.O50.00
i,oso 00
1,450 00
1.059.00
i,oso ao
7,050.00
1,050.00
7.050.00
1,050.0�
1,050 00
i.aso.00
1.050.00
t,050.W
1.050 00
�,os000
1,OW W
t��S�W
i,os000
1,05000
1 050.00
1.050.00
1,050.00
7.050.00
t,050.00
i.oso.00
1,050.00
t,050.00
7�050.00
7,050 00
1,OW 00
1,050.00
t,050.00
t.O50.W
t,050 00
1.050.00
¢uu o.00 00(
0.00 0.90 0.0(
�.� 000 oIX
15,920.68 143,286.N 119,405.0<
15,920.68 143.28G17 119.405D5
33,51227 301,610.43 251,342.0'e
33,St227 30t,67043 25'1,342.0:
33,57227 301.610.43 257.342.Oe
33,5122] 30t,6tOC3 251,342.0'e
33,51227 301,610.43 251,342.02
33,51227 301,67043 257.342.02
33,51227 301,67a.43 251,34202
33,51227 307,610.43 251,342.02
33,57227 301,670.43 25'1,34202
33,51227 301.61093 25t.342.02
33,5729 30t,6t0.43 25t,39202
33,5122] 301,610.43 251,342.02
33,57227 307,61043 25t,34202
33.512
33.5t2
33.512
33,5t2
33,512
au1.6t0.43 251.342
301,610.43 251,342.
30t,6t043 251,342
301.61043 �5i aa�
:v,ma[/ 301,610.G3. 251.342
33,51221 301,61043 251,342
33,51227 307.610.43 251.342
33,51227 301.6t0.43 251,342
33,59227 301,610.43 251,342
33,51227 3�1,67043 251,342
33,51227 301,670.43 257,342
33,51227 301,61043 251,342
33,51227 301,61�.43 251,342.
33,51227 301,6'1043 25'1,3q2
33.St227 30t.610.43 257.342.
33,512.2� 301,61093 251,34p,
33,51221 307,610.43 25t,342.
33,5'12.27 307,610.43 251,342
38.51227 301,670.43 25t.342
33�57227 301.610.43 251.342.
33,517�2] 301,6t043 251,342
33,St22� 307,610.43 25t,342.
33,512.2� � 301,6t043 251,342
33.51227 '�. 30t,61043 251.342.
33,51227 �'�.301,670.43 251,342.
�-540
�
TIF Pro�-72 �
p1►k-��0
EXIIIBIT D
ESTIMATED IMPACT ON TAX BASE
The �,stimated impact on other taxing jurisdictions assumes that the redevelopment contemplated
by the�T� Increment Financing Plan would occur without the creation of the District. However,
the Auth�erity has determuied that such development would not occur "but for" tax increment
financing a�d that, therefore, the fiscal impact on other taxing jurisdictions is $0. The estimated
fiscal impacf�of the TaY Increment Financing District would be as follows if the "but for" test
was not met ��
Total Net � Tax Capacity (CTC) � Percent of CTC
�
ACT ON TAX RATED
Extension Rates `� of Total � CTC
na
`\
The estimates listed above display the captured tax capacify when all construction is completed.
The tax rate used for calculations is the 2003/Pay 2004 rate. t,�'he total net capacity for the
entities listed above are based on Pay 2004 figures.
�4
i
1590209v4 D-1
•��
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