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<br />Council Member Lee questioned whether the area would develop in 10 or 15 years on its <br />own. <br /> <br />City Attorney Hodl: recommended using a consultant for an opinion on whether the area <br />would develop on its own without the TIF assistance prior to the expiration of a proposed <br />TIF district. . <br /> <br />Councii Member Capra questioned whether this would constitute spot zoning. <br /> <br />Mr. Kellier indicated they would have a contiguous piece that is 19 to 20 acres that would <br />all be townhomes. <br /> <br />Mr. Pelstring indicated that they would have an area that meets state statute for a <br />redevelopment district. <br /> <br />Mr. Pelstring indi~ated that TIF does not provide a subsidy to the developer to lower the <br />price but to bring the price to a level that makes it developable. He then indicated that <br />they did a redevelopment in Hugo with an average land cost of $26,000 per acre for the <br />land and, in this instance, the land will run $45,000 to $50,000 per acre with considerable <br />soil correction required. The TIF assistance would bring the pricing down to a level that <br />is competitive in the market. <br /> <br />Mr. Pelstring indicated that he drove the area and determined that there are 7 buildings <br />that would meet the substandard building requirement out of the total of 9 and the state <br />statute requires only 50% of the structures to be substandard. <br /> <br />Mr. Pelstring indicated that the office condos will improve the area as would the <br />proposed townhomes to make the property adjacent to it more attractive to commercial <br />development. <br /> <br />Mr. Pelstring indicated that the City would continue to receive the existing taxes and it is <br />only the increased taxes that go to tax increment. <br /> <br />Council Member Capra asked whether the developers would consider the location if TIF <br />were not available to them. <br /> <br />Mr. Montgomery indicated that it would not make sense. He then said that they would be <br />looking at considerable soil amendments in the area and commented that development is <br />easier without TIF on a sandy soil location. He further commented that the City gets <br />increment along the way 10 to 20% of the increment. <br /> <br />Council Member Capra commented that there are limitations on what the increment can <br />be used for. <br /> <br />Mr. Montgomery indicated that White Bear Township uses TIF to fund a lot of projects <br />including the ball fields. He then commented that they have to buy buildings and tear <br /> <br />Page 7 of 14 <br />