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<br />Transportation. The transportation system in the metro area is primarily designed to <br />move people into (and back out of) St. Paul and Minneapolis. It is not designed to move people <br />from suburb to suburb. For businesses to attract a large employee pool, they need good transit <br />systems for their employees. This is the reason many businesses want to bE! able to locate in <br />the core cities of the metro area. Many suburban businesses are faced with small employee <br />pools because transit is poor or absent altogether. When tax increment financing is used to <br />redevelop areas in central cities and inner-ring suburbs, businesses are better able to locate <br />within these cities, which results in more (and more efficient) use of the current transit system. <br />When TIF is used in outer-ring suburbs, however, it not only contributes to urban sprawl, but <br />also places pressure on the transit system to accommodate moving people around at the fringe <br />of the metro area. This is why it is inappropriate to use TIF in outer-ring suburbs. <br />Land Availability and Cost. Many businesses would like land in central cities to be as <br />inexpensive as land in suburban fringe areas. This is impossible for central cities to accomplish <br />without the use of tax increment financing. <br />Core cities and inner-ring suburbs are landlocked; unlike outer-ring suburbs, they are <br />unable to expand their boundaries. By virtue of supply and demand, landlocked cities thus have <br />a shortage of available land on which to develop. On the one hand, cities' characteristics and <br />attractiveness create a high demand to locate within the boundaries of Minneapolis and St. <br />Paul. But what land is available contains obsolete buildings, old grain silos, contaminated soil, <br />and abandoned railroads. The costs to develop these parcels are almost always exorbitant. <br />(Costs include land assembly, soil reclamation, and infrastructure improvements.) Most <br />businesses cannot afford such costs. In contrast, suburbs often offer land without these costs, <br />so businesses go out to the suburbs, where they can build on cornfields, thus contributing to <br />urban sprawl. <br />An example of how TIF can lower urban land costs and attract business is the Southeast <br />Minneapolis Industrial project area, also known as SEMI. The SEMI project area, just north and <br /> <br />II <br />