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Home My WebLink About4D, Resolution Calling for Public Hearing - TIF - Presbyterian Homes�I�EN HILLS Request for Council Action Prepared By: Sue Iverson, Finance Director /Treasurer Council Meeting Date: October 25, 2010 Resolution 2010 -056: Set Proposed TIF District Public Hearing Date Presbyterian Homes Redevelopment on December 13, 2010. Budgeted Amount: N/A Recommendation: 1. Motion to adopt Resolution 2010 -056, a resolution calling for a public hearing by the City Council on the proposed adoption of a modification to the development program for Development District No. 1 and the proposed adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 4. Actual Amount: N/A Supporting Documents: 1. Memo from Sue Iverson, dated October 25, 2010. 2. Resolution 2010 -056. 3. Memo from Stacie Kvilvang dated October 25, 2010. 4. Schedule of Events. Funding Source: N/A DATE: October 25, 2010 2k.RZEN HILLS MEMORANDUM TO: Honorable Mayor and City Council Patrick Klaers, City Administrator FROM: Sue Iverson, Finance Director /Treasurer Background/Discussion: Staff Recommendation: V SUBJECT: Proposed TIF District Presbyterian Homes Redevelopment Presbyterian Homes has approached the city about its proposed redevelopment of portions of their facilities on their existing site. As a part of this redevelopment, the possibility of relocating the Arden Hills library to this site is also being explored. Presbyterian Homes is inquiring about the possibility of the City to offset some of the costs associated with this redevelopment by providing Tax Increment Financing (TIF). Presbyterian Homes has completed the required applications and paid the required fees and escrow deposits. At the August 30, 2010 City Council meeting, the City Council called for a Public Hearing to be held on October 25, 2010. However, due to the timing required to complete all necessary steps to prepare the proposed Modification to the Development Program for Development District No. 1 and the proposed adoption of a Tax Increment Financing Plan for Tax Increment Financing District No. 4 the hearing date needs to be changed. Staff recommends adopting Resolution 2010 -056, a resolution calling for a public hearing by the City Council of Arden Hills on the proposed adoption of a Modification to the Development Program for Development District No. 1 and the proposed adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 4. CITY OF ARDEN HILLS COUNTY OF RAMSEY STATE OF MINNESOTA RESOLUTION NO. 2010-056 RESOLUTION CALLING FOR A PUBLIC HEARING BY THE CITY COUNCIL ON THE PROPOSED ADOPTION OF A MODIFICATION TO THE DEVELOPMENT PROGRAM FOR DEVELOPMENT DISTRICT NO. 1 AND THE PROPOSED ADOPTION OF THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 4. BE IT RESOLVED, by the City Council (the "Council for the City of Arden Hills, Minnesota (the "City as follows: WHEREAS, on August 30, 2010, the Council called for a public hearing on October 25, 2010 for the proposed Modification to the Development Program for Development District No. 1 and the proposed adoption of a Tax Increment Financing Plan for Tax Increment Financing District No. 4; and WHEREAS, due to timing required to complete all necessary steps to prepare the proposed Modification to the Development Program for Development District No. 1 and the proposed adoption of a Tax Increment Financing Plan for Tax Increment Financing District No. 4 the hearing date needs to be changed; ATTEST: NOW, THEREFORE, BE IT RESOLVED by the Council, as follows: Section 1. Public Hearing. This Council shall meet on December 13, 2010, at approximately 7:00 P.M., to hold a public hearing on the proposed Modification to the Development Program for Development District No. 1 and the proposed adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 4, which are referred to collectively herein as the "Program and Plan all pursuant to and in accordance with Minnesota Statutes, Sections 469.124 to 469.134, and Sections 469.174 to 469.1799, inclusive, as amended, in an effort to encourage the development and redevelopment of certain designated areas within the City; and Section 2. Notice of Public Hearing, Filing of Modifications. City staff is authorized and directed to work with Ehlers Associates, Inc., to prepare the Program and Plan and to forward documents to the appropriate taxing jurisdictions including Ramsey County and Independent School District No. 621. The City Administrator is authorized and directed to cause notice of the hearing, together with an appropriate map as required by law, to be published at least once in the official newspaper of the City not later than 10, nor more than 30, days prior to December 13, 2010, and to place a copy of the Program and Plan on file in the City Administrator's office at City Hall and to make such copy available for inspection by the public. Dated: October 25, 2010 Patrick Klaers, City Administrator Adopted: Stan Harpstead, Mayor Memo To: Sue Iverson Finance Director From: Stacie Kvilvang Date: October 25, 2010 Subject: Proposed TIF District Presbyterian Homes Redevelopment Presbyterian Homes has approached the City about its proposed redevelopment of portions of their facilities on their existing site. They have inquired about the possibility of the City providing Tax Increment Financing (TIF) to offset some of their costs associated with the redevelopment. Presbyterian Homes has submitted a formal application to the City along with the required application fee of $2,000 (non refundable) and $10,000 escrow fee to cover costs. As stated in the application, to the extent that the $10,000 is not adequate to cover all costs associated with creation of the TIF district and development agreement, the developer is required to submit payment for these additional costs upon notification from the City. At this time, it is estimated that the costs will range between $30,000 and $40,000 (excludes any estimate for legal costs associated with conduit financing requests). Based upon the existing site and qualifications required to create a district, we recommend that the City Council consider creating a renewal and renovation district, which has a sixteen (16) year term. In order to qualify for this type of district, the City must find: 1. That 70 of the area of the district is occupied by buildings, streets, utilities, paved or gravel parking lots, or other similar structures; 2. 20 percent of the existing structures are structurally substandard; and 3. 30 percent of the other buildings require substantial renovation or clearance to remove exiting conditions In order to comply with the first condition, only 15 percent of each parcel in the district needs to be occupied. Since this district is going to be comprised of one parcel, 15 percent of that parcel needs to be occupied by the above referenced items (which is the case). For purposes of determining compliance with item #2, a building is considered to be structurally substandard if the cost to bring it into compliance with current building code costs more than 15 percent to construct a new structure of the same square footage and type on the site. We recommend that the City contract with a third-party entity to complete the required inspections to make the above referenced findings and complete a report for the City. It is estimated that the cost to have the inspection and accompanying report completed with be approximately $6,000 (included in the estimate above). EHLERS LEADERS IN PUBLIC FINANCE 3060 Centre Pointe Drive Roseville, MN 55113-1105 Phone: 651-697-8506 Fax: 651-697-8555 skvilvang@ehlers-inc.com Sue Iverson Proposed TIF District Presbyterian Homes Redevelopment October 25, 2010 Page 2 In order to meet timelines for some components of the redevelopment, the City Council needs to set a public hearing date for the creation of the district. From the public hearing date we "back" into a timeline witch outlines the various steps and actions that are required to be completed prior to the public hearing. Attached is a proposed schedule of events to create a renewal and renovation district. The first action required is for the City Council to set a public hearing date on the proposed TIF district and development. Setting the public hearing date does not commit the City Council to provide Presbyterian Homes a specified amount of TIF, it only allows the process to begin to create the district and for staff to begin negotiations with them. Please contact me at 651- 697 -8506 with any questions. By November 1, 2010 November 1, 2010 N/A November 12, 2010 November 15, 2010 November 15, 2010 December 1, 2010 SCHEDULE OF EVENTS CITY OF ARDEN HILLS RAMSEY COUNTY, MINNESOTA FOR THE MODIFICATION TO THE DEVELOPMENT PROGRAM FOR DEVELOPMENT DISTRICT NO. 1 AND THE ESTABLISHMENT OF THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 4 (a renewal and renovation district) (as of September 21, 2010) October 25, 2010 City Council calls for a public hearing on the proposed Modification to the Development Program for Development District No. 1 and the proposed Establishment of the Tax Increment Financing Plan for Tax Increment Financing District No. 4. LHB reviews buildings for redevelopment qualifications and provides initial report to City. Project information (property identification numbers and legal descriptions, detailed project description, maps, but /for statement, and list of sources and uses of funds) for drafting necessary documentation sent to Ehlers. Ehlers confirms with the City whether building permits have been issued on the property to be included in the TIF District. Project information submitted to the County Board for review of county road impacts ifnecessary* (at least 45 days prior to public hearing). *The County Board, by law, has 45 days to review the TIF Plan to determine if any county roads will be impacted by the development. Please be aware that the County Board could claim that tax increment should be used for county roads, even after the public hearing. Fiscal /economic implications received by School Board Clerk and County Auditor (at least 30 days prior to public hearing). [Ehlers will fax and mail on or before November 12, 2010.] LHB provides final report. Ehlers conducts internal review of the Program and Plan. Date of publication of hearing notice and map (at least 10 days but not more than 30 days prior to hearing). [New Brighton Shoreview -Arden Hills Bulletin publication deadline: November 24, 2010. Ehlers will submit notice, map, and instructions on or before November 24, 2010, via email to legals @Zillienews.com.] FREERS LEADERS IN PUBLIC FINANCE December 6, 2010 SCHEDULE OF EVENTS PAGE TWO CITY OF ARDEN HILLS RAMSEY COUNTY, MINNESOTA FOR THE MODIFICATION TO THE DEVELOPMENT PROGRAM FOR DEVELOPMENT DISTRICT NO. 1 AND THE ESTABLISHMENT OF THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 4 (a renewal and renovation district) Planning Commission reviews the Program Modification and TIF Plan to determine if they are in compliance with City's comprehensive plan and adopts a resolution approving the Program and Plan. December 13, 2010 City Council holds a public hearing at 7:00 P.M. on the Modification to the Development Program for Development District No. 1 and the Establishment of Tax Increment Financing District No. 4 and passes resolution approving the Program and Plan. [Ehlers will email Council packet information to the City on December 6, 2009.] By December 31, 2010 Ehlers files Program and Plan with the MN Department of Revenue, Office of the State Auditor, and Ramsey County. An action under subdivision 1, paragraph (a), contesting the validity of a determination by an authority under section 469.175, subdivision 3, must be commenced within the later of: (1) 180 days after the municipality's approval under section 469.175, subdivision 3; or (2) 90 days after the request for certification of the district is filed with the county auditor under section 469.177, subdivision). FREERS LEADERS IN PUBLIC FINANCE