6B, Public Hearing Proposed TIF District Resolution 2010-081, -082 & -083

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_ EXHISTT A RESQLUTION NO. 2010-082 The reasons and facts supporting the findings for the adoption of the Tax Incre�nent Financing Plan (T�F Plan) for TaY Incre�nent Financing District Na. 4(Dist�rict), pursuan# to Minnesota Statutes, Sections 469.174 through 469.1799, all inclusive, as amended {Act), as required by Section 4b9.175, Subdivision 3 of the Act, are as follows: Finding that Tax Increment Frnancrng District No. 4 is a renewal and renovation distt�ict as defined in Section 4b9.174, Subdivision 1 Da of the Act. The District consists of twa parcels and three buildings, with plans to eedevelap the area for senior housing purposes. At least 7d percent of the area of th.e parcels in the District are occupied by buildings, streets, utilities, paved or gra�el parking lots or other sirriilar structur�s. One building {more than 24 percent of the buildings in ihe Distric#}, is structurally substandard as defined in the Ac�, and one building (more than 30 percent of the buiidings in the District} requires substantia� renovation or clearance to remove existing conditions, such as those existing conditions defined in the Act. (See Appendix F of the TIF Plan.) 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur salely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected ta occur wathout the use af tax increment ftnancing would be less than the increase in the market value estrraated to result from the pYoposed development after subtracting the present value of the projected tax incYements far the mpximum duratian of the District permitted by the TIF Plan. The proposed develapment, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: This finding is supported by the fact that the redeveiopment proposed in the TIF Plan meets �he City's abjectives for redevelopment. There are higher costs associated with redevelaping the site d�e to accor�modating existing residents in their current units until the new facility is cans�c-ucted; relocating existing residents to the new facility; and site constraints reiated to topography, grading, ciemolitian and utilities fog constructing the new facility adjacent to the existing iacility. In additian, increased landscaping will be reyu�red to provid� an adequate buffer and screening from the adjacent single-fatn.ily homes. Due to these higb.er costs of redeveIopment on the parcels this project is feasible only through assistance, in part, from taz� increment financing. The developer was asked for and provided a letter and a profox-nna as justification that the developer would nat have gone forward without tax increment assistance. (See attachment in Appendix G of the T1F Plan.) The irzcreased market value of the site that could reasonably be expected to occur without the use of tcrx inerement financing would be less than the increase in market vadue estimated to result from the proposed development after subtracting the present value of the projected tax increments for the mmrimum duration of the Dtstrict permitted hy the TIF Plan: The above finding explained why t11e proposed redevelopznent would not likely occur witl�out tax increment assistance. I� is possible that some redevelopment oi the existin.g senior housing complex would go forward without assist�ce, but the unique costs of this efFort {described above) rnean that without assistance, any atternative redevelapment would necessarily be carried out at a smaller scale, and most likely over a Ionger period of tima. I# is impossible to predict what an alternative market value would be if no tax incretx�.ent assistance were provided, but it is certain that the alternative redevelopment would produce signifcan�ly less value than the comprehensive, high quality developnnent that is proposed under the TIF Plan. There is no reasonable likelihood that an alternate, unassisted deveiopm.en�t would add as much as $9,972,625 in mar�Cet value (whic� is the alternate threshold