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Regular City Council Meeting Monday, November 08, 2010 Page 19 City and United Properties Residential LLC for dedication of increment from Tax Increment District (TIF) District 19 to Phase I of Applewood... A bench handout was provided consisting of a memorandum dated November 8, 2010 to City staff from the City's bond counsel, Mary L. Ippel, Briggs and Mor- gan, as well as a revised Development Agreement changing the period for default (page 8), both attached hereto and made a part thereof Councilmember Roe questioned the language related to applicability of TIF proceeds to property acquisition or infrastructure improvements. Tony Shertler, Springsted Representative, the City's Financial Consultant Mr. Shertler noted that provisions were dependent on the type of agreement, and that staff would verify costs as invoices were presented; and clarified that the City was not putting up any money upfront in this Agreement, so there was no con- cern. From a philosophical standpoint, Councilmember Roe questioned if the City could stipulate TIF fund use in developer agreements. Mr. Shertler responded that many cities did prioritize uses of TIF funds. Mayor Klausing noted that the point raised by Councilmember Roe was good; but from a practical affect, the costs of this project significantly exceeded what it was likely to generate. Councilmember Ihlan sought clarification, from her understanding that the devel- oper already owned the property; and opined that the City had no business offer- ing public money for property acquisition and that any language should be re- moved from the developer agreement. Alex Hall, United Properties representative Mr. Hall referenced "Exhibit C" detailing site improvements, and clarified that the developer was seeking reimbursement for those costs, consisting mostly of putting in the main public road to access the park, as well as the turnaround con nected to the park, as well as the two public ponds on the site to handle runoff from that road and infiltration basins, with the land itself deeded over to the City for the public road. Mr. Hall advised that those infrastructure improvements would be done upfront by the developer; and that the financial gap was well in excess of $1 million between Phases I and II, with the TIF well below that gap, bur requiring site related costs benefiting both the developer and the City. Mr. Hall noted that the TIF amount for Phase I was less than $300,000, approximately $275,000 $290,000, and less than originally projected. Mr. Hall noted that Phase II needed to be initiated prior to the developer being able to access those TIF funds.