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CentervilleTIFDistrict1-8 <br />October4,2019 <br />Page 2 <br />HousingTIFDistrict <br />ThepurposeofahousingTIFdistrictistoassistdevelopmentofowner-occupiedandrentalhousing <br />whereaminimumportionoftheunitsareprovidedforlow-andmoderate-incomeindividualsand <br />families.Housingcanbeconstructedonbarelandprovidedthequalifyingcriteriaaremet. <br />TheDeveloperoftheProjectisproposingtoprovideforaminimumof20%oftherentalunitstobe <br />affordabletopersonsat50%orlessofareamediangrossincome.Thiswouldmeettheminimum <br />requirementsofahousingtaxincrementfinancingdistrictunderMinnesotalaw.Figure1that <br />followsprovidesinformationonincomelimitsbyhouseholdsizeandcorrespondingrentsby <br />bedroomsize.Fortheproposed53-unitapartmentbuildinginCenterville,tomeettherequirements <br />atleast11oftheunitswouldneedtobeleasedtoincomequalifiedpersons.Theremaining42units <br />maybeleasedatmarketraterentsandtopersonthatarenotincomequalified. <br />Figure1. <br />IncomeLimitsbyHouseholdSizefor <br />2019at50%ofAreawideGross <br />MedianIncome <br />1Person$35,000 <br />2Person$40,000 <br />3Person$45,000 <br />Size <br />4person$50,000 <br />Household <br />Rentsat50%ofMedianIncomeMarketRents <br />Studio$875$1,100 <br />1-Bedroom$937$1,500 <br />2-Bedroom$1,125$1,775 <br />mSize <br />Bedroo <br />SourceofdataforFigure1:MNHousingFinanceAgency,dataforyear2019, <br />andMarketRentsbasedonDeveloperProForma. <br />ProcessforApproval <br />ThefirststepincreatingtheTIFDistrictistheadoptionofaTaxIncrementFinancingPlanfortheTIF <br />District(the“TIFPlan”).TheTIFPlanprovidesinformationabouttheProjecttobefundedwithtax <br />incrementfromtheTIFdistrictandauthorizestheuseoftaxincrementfromthedistricttopayTIF- <br />eligibleprojectcosts,amongotheritems. <br />AtaxincrementfinancingdistrictestablishedbytheCitymustbeestablishedwithintheboundaries <br />ofaDevelopmentDistrict.TheDevelopmentDistrictissometimescommonlyreferredtoasa <br />“projectarea”.TheCityhaspreviouslyestablishedDevelopmentDistrictNo.1,asmodifiedover <br />time,andsettheboundariesoftheDevelopmentDistricttobecontiguouswiththeboundariesofthe <br />City.WhenanewtaxincrementfinancingdistricthasbeenestablishedbytheCity,theDevelopment <br />ProgramfortheDevelopmentDistrict,hasbeenamendedandsupplementedfromtimetotime.The <br />3 <br /> <br />