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EDC Minutes August 24, 2011 Page 2 of 4 Community Development Director Hutmacher said there will be two boards thanking donors to Celebrating Arden Hills. There will be printed nametags for those who RSVP'd and blank nametags available for those who did not RSVP. Councilmember Holden will be emceeing the event; EDC members can focus on greeting attendees. Community Development Director Hutmacher stated that North Heights Lutheran Church was chosen as the venue in part because they provide set-up, catering, and audio-visual services. Chair von Holtum expressed that everything appears to be in good shape and that twelve RSVPs is encouraging considering it is still early. B. City Website Redesign Project Community Development Director Hutmacher announced that the Communications Committee is developing an on-line survey to gather suggestions from current users of the City's website. The on-line survey can be promoted at the State of the City and Celebrating Arden Hills events. It would be helpful to get feedback on the website from the EDC and the rest of the business community. Chair von Holtum supported the City's intention of working with professionals on the website redesign project. C. Tax Increment Financing Community Development Director Hutmacher introduced the topic of developing a benchmark limit for the total tax capacity captured by tax increment financing (TIF) districts. The Financial Planning and Analysis Committee (FPAC) has drafted a white paper that suggests Minnesota's state average as a potential benchmark. A recommendation is not needed today. Community Development Director Hutmacher reviewed definitions of tax capacity and tax rate. Tax capacity is a percentage of a property's assessed market value and differs among types of property. Residential units, for example. have a tax capacity of 1%. whereas commercial/industrial property has a tax capacity of 1.5%for the first $150,000 in assessed value and 2% for value above $150,000. The tax rate, or "mill rate", is a blended rate between all of the taxing jurisdictions including the City, County, school district, etc. Total property taxes are calculated by multiplying the tax capacity for each parcel by the jurisdiction's tax rate. The combined tax rate of Arden Hills'jurisdictions is around 1.05%. TIF districts capture the tax increment that would otherwise have gone to other jurisdictions. The captured increment is used to pay for infrastructure required by development. State Statutes define eligible and ineligible TIF expenditures. For example, infrastructure upgrades are eligible, but parks and general government services are ineligible. Discussion took place about the issue of having constrained cash now for public services during the duration of the tax increment district while taxes that would otherwise be available for public services are diverted to infrastructure costs. Commissioner Huninghake asked about the duration of tax increment districts. Community Development Director Hutmacher responded that it