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EHLERS LEADERS IN PUBLIC FINANCE To: Ron Moorse—City Manager O From: Stacie Kvilvang—Ehlers and Associates - W Date: October 15,2008 Subject: Special TIF Legislation for TCAAP Overview We have had discussions with the City Council over the past several years about creating a redevelopment Tax Increment Financing (TIF) district to assist in offsetting some of the increased costs associated with redeveloping the TCAAP site. Based upon review of the TIF statutes as they currently are, we are proposing that the City Council consider obtaining special legislation to remove some of the existing barriers we see with the current TIF statute. Issues to Consider 1. What is the term of a redevelopment district and what tests have to be met to qualify an area for a redevelopment district? 2. Why is there a need to pursue special legislation? 3. What are the proposed changes to the TIF Statute and why are they needed? 4. Why are we looking at creating special legislation at this time? 5. What is the likelihood of the legislation being approved? 6. What is the process moving forward if we pursue special legislation? Analysis of Issues 1. What is the term of a redevelopment district and what tests have to be met to qualify an area for a redevelopment district? A redevelopment district has a 26-year duration (25 years after the receipt of the first increment). In order to qualify parcels of land to be included in a redevelopment TIF district, they must meet the following tests: a. Parcels consisting of 70% of the area of the district must be occupied by buildings, streets, utilities,paved or gravel parking lots or other similar structures LEADERS IN PUBLIC FINANCE �j _..--- ------------.-.------------------------—-- .-._._._ __.-.- - ---------------- ........-- --------- _---- 1 3o6o Centre Pointe Drive Phone:65i-697-85o6 Fax:653.-697-8555 Roseville,MN 55113-1105 skvilvang@ehlers-inc.com