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HomeMy WebLinkAboutResolution - 86-32 - Establishing a Housing Plan and Tax Increment Financing District #10 - RESOLUTION NO. t)(6 A RESOLUTION TO DESIGNATE AND ESTABLISH A HOUSING DISTRICT AND ESTABLISH A TAX INCREMENT FINANCING DISTRICT NO . 10 PURSUANT TO THE PROVISIONS OF SECTION 273 . 71 TO 273 . 78 INCLUSIVE OF THE MINNESOTA STATUTES (CHAPTER 322 , LAWS OF MINNESOTA, 1979 ) , ADOPTING A HOUSING PROGRAM AND FINANCE PLAN FOR SAID HOUSING AND TAX INCREMENT FINANCE. DISTRICT, AND APPROVING THE HOUSING AND REDEVELOPMENT AUTHORITYS ' INTEREST REDUCTION PROGRAM FOR THE DISTRICT. WHEREAS, the City Council of the City of Eden Prairie , Minnesota ; ("City" ) , has determined that it is necessary and desirable in the public interest to designate , establish , develop anal administer a Housing District in the City of Eden Prairie , Minnesota , as defined in Minnesota Statutes Section 273 . 72 , Subd. 11 ; and WHEREAS, the Housing and Redevelopment Authority in and. for the City of Eden Prairie , ( "HRA" ) , has adopted a Redevelopment Plan dated October, 1985 , (the "Plan" ) , part of which plan contains a method of financing for a Project as defined in Minnesota Statutes Section 462 . 421 , Subd. 14 ; and WHEREAS, the Plan has been prepared by the HRA with the cooperation and assistance of the appropriate City departments ; and WHEREAS, the City Council adopted the Plan on November 5 , 1985 ; and WHEREAS, the HRA, by resolution duly adopted at a meeting held on February 18 , 1986 , did approve a Tax Increment Financing Plan ( "TIF Plan" ) and Interest Reduction Program and did authorize application to the City Council for the TIF Plan and Interest Reduction Program; and WHEREAS, the HRA may not proceed with -the TIF Plan unless the City Council , by resolution , makes certain findings with respect to the TIF Plan and designates Tax Increment Financing District No . 10 ( "TIF District No . 10 " ) ; and WHEREAS, the City Council of the City has determined that tax increment financing will be necessary to finance the public costs associated with the Housing District and Project within the TIF District pursuant to Minnesota Statutes 273 . 71 to 273 . 78 , inclusive ; and Page - 2- WHEREAS , the HRA has fully informed the members of the Board of Hennepin County Independent School District 272 and Vocational School District 287 and Hennepin County Board of Commissioners of the fiscal and economic implications of the proposed TIF District ; and WHEREAS , at said public hearing , all persons and parties were given full opportunity to present written or oral testimony, comments , objections, suggestions, and other matters , all of which were duly considered by the City Council ; and WHEREAS , the HRA has certified there are no individuals, families and businesses that will be displaced as a result of the carrying out of this project ; and WHEREAS, the TIF Plan will afford maximum opportunity consistent with the sound needs of the municipality as a whole for the redevelopment of the area encompassed within the TIF District No . 10 by private enterprise ; and WHEREAS , the TIF Plan conforms to the general plan for the redevelopment of the area and development of the municipality as a whole ; and WHEREAS, the City Council of the City finds the proposed TIF District No . 10 is a Housing District and that it consists of a project intended for occupancy , in part , by persons or families of low and moderate income as defined in Chapter 462A, Title II of. -the National Housing Act of 1934 , the National Housing Act of 1959 , the United States Housing Act of 1937 , as amended , Title V of the Housing Act of 1949 , as amended , any other similar present or future Federal , - State or Municipal legislation, or the regula- tions promulgated under any of those acts ; NOW, THEREFORE, BE IT RESOLVED, THE CITY COTJNCIL OF THE CITY OF EDEN PRAIRIE, does hereby designate and establish a Housing District , approves Tax Increment Financing District No . 10 , and adopts the TIF Plan and Interest Reduction Program for the Project and finds : 1 . TIF District No . 10 is a Housing District ; 2 . That the proposed development, in the opinion of the City Council would not occur solely through private investment within the reasonably foresee- able future and, therefore, the use of tax increment financing is deemed necessary ; 3 . That the TIF Plan conforms to -the general plan for the development or redevelopment of -the municipality as a whole ; Page -3- 4 . That the TIF Plan will afford maximum opportunity consistent with the sound needs of the City as a whole for the development of the district by private enterprise ; 5 . That the Interest Reduction Program is necessary to accomplish the goals of the City and carry out the TIF Plan . 6 . That the City makes the above findings and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit "A" . ADOP12ED BY THE CITY COUNCIL this 18th day of __FPhraar, , 1986 mayor ATTEST: 1 � C� y Cler EXHIBIT "A" TO RESOLUTION 6 REASONS AND FACTS SUPPOR'T'ING FINDINGS FOR ESTABLISHMENT OF PROPOSED TAX INCREMENT FINANCING DISTRICT NO . 10 AND THE ADOPTION OF A TAX INCREMENT FINANCING PLAN RELATING THERETO. BACKGROUND AND SUMMARY OF EVIDENCE In late 1984 the Planning Commission for the City of Eden Prairie first reviewed the site plan details for the proposed Prairie Village Apartments . The proposal originally involved one 56-unit apartment building for lower income elderly persons and one 56-unit multifamilyapartment building in which at least 20% of the units P � would be reserved for tenants whose adjusted gross income did not exceed 80% of. the Minneapolis/St . Paul metropolitan statistical area median income . The project was proposed for the parcel legally described as all of Outlot B and that part of Outlot C, Gonyea 4th Addition lying northwesterly of a line drawr from a point on the westerly line of said Outlot C distant 96 . 68 feet southeasterly along said western line from the most westerly corner of said Outlot C -to a point on the northerly line of said Outlot C distant 159 . 24 feet southwesterly along said northerly line from the 'inost northerly corner of said Outlot C (hereinafter referred to as the "Parcel " ) . It was determined that the Parcel was vacant, unused and underused Page -2- ' within the meaning of Minnesota Statutes 426 . 421 , Subd . 13 (3 ) and the Planning Commission recommended approval of the site plan details to the City Council . At the direction of the Eden Prairie Housing and Redevelopment Authority (hereinafter referred to as the "HRA" ) , a redevelopment plan for Prairie Village Apartments was prepared with the cooperation and assistance of the appropriate City department . The redevelopment plan was completed in October , 1985 . The plan included the following analysis as to why the proposed Prairie Village Apartments would be consistent with the City ' s housing policies , RELATIONSHIP TO LOCAL OBJECTIVES The Prairie Village Apartments Project is consis- tent with the following policies set forth in the City ' s Housing Plan which was adopted pursuant to Minnesota Statutes Sec . 462 (c ) . 1 . The City ' s desire to encourage low income housing projects and to work with the Metropolitan Council to develop such projects . 2 . The City ' s desire to encourage 0.evciopment of a variety of living and working environments for all kinds of people by holding development costs down . 3 . The City ' s desire to encourage a variety of housing types and prices through innovative land use mixes . 4 . The City ' s desire to encourage development of a variety of living and working environments for people of all ages , races and income groups . 5 . in creating its multifamily housing finance program, the City Council of the City has found and determined that the preservation and enhance- ment of the high quality of life in the City is dependent upon the maintenance and provision of Page -3- adequate, decent, safe and sanitary housing stock ; that accomplishing the provision of such housing stock is a public purpose and will benefit the citizens of the City ; that a need exists within the City to provide in a timely fashion additional and affordable housing to persons residing and expected to reside in the City; that a need exists for mortgage credit to be made available for the new construction of additional multifamily housing; that a need exists to encourage elderly and low income housing projects ; that a need exists to encourage development of a variety of living and working environ- ments for all kinds of people by holding development costs down; that a need exists to encourage a variety of housing types and prices through innovative architecture and land use mixes ; and that a need exists to encourage development of a variety of living and working environments for all people of all ages, races; and income groups . 6 . The City, in considering the multifamily housing program, has considered generally available information regarding conditions in the housing industry and the information contained in the City ' s 463 (c ) Housing Plan, adopted on October 30 , 1978 , as amended February 2 , 1982 (the "Housing Plan" ) , including particularly i . The availability and affordability of other government housing programs ; ii . The availability and affordability of private market financing for the acquisition of land for and construction of multifamily housing units; iii. . An analysis of population and employment trends and future employments needs ; iv. The recent housing trends and future housing needs of the City; and V. An analysis of how the program will meet the needs of persons and families residing and expected to reside in the City. Page -4- a s 7 . The City , in considering this program, has further considered i . The amount, timing , and sale of bonds to finance the estimated amount of construction and mortgage loans to be made under the program, to fund the appropriate reserves and to pay the cost of issuance ; ii . The method of monitoring and implementation of the program to assure compliance with the City ' s Housing Plan and its objectives; iii . The method of administering , servicing, and supervising the program; iv . The cost to the City, including future administrative expenses ; V. The restrictions on the multifamily develop- ment to be financed under this program; and vi . Certain other limitations . The Plan along with the preliminary draft of the Tax Increment Financing Plan for Tax Increment Financing District No . 10 proposed to be located entirely within the Redevelopment Plan area was duly transmitted by the HRA to the Planning Commission for the City of Eden Prairie for its study and opinion thereon. At its meeting of October 28 , 1985 the Planning Commission recommended adoption of the Plan and the preliminary draft of the Tax Increment Financing Plan for Tax Increment Financing District No. 10 . The evidence introduced and described in the Planning Commission minutes of October 28 , 1985 , is made a part of the record in these proceedings . On November 5 , 1985 in Resolution 85-2 the HRA adopted the October , 1985 Redevelopment Plan which included the preliminary draft of the Tax Increment Financing Plan for Tax Increment Financing District Page -5- No . 10 . On November 5 , 1985 in Resolution 85-243 , the City Council , City of Eden Prairie also approved the Redevelopment Plan and pre- liminary draft of the Tax Increment Financing Plan for Tax Increment Financing District No . 10 . The evidence introduced and described in the City Council minutes of November 5 , 1985 is made a part of the record in these proceedings . Also made a part of the record in these proceedings is the August 26 , 1985 letter of Sherrill Kuretich to Mayor Peterson and the members of the City Council. which analyzes why the multihousing project would nto be financially feasible as a conventionally financed project . No November 5 , 1985 in Resolution No . 85-1 the HRA authorized the chairman and administrator of HRA to execute on behalf of the HRA the Purchase Agreement for the Parcel , as well as , the Property Management Agreement. Resolution No . 85-1 authorized the HRA to purchase the Parcel for the total sum of $150 , 000 . 00 payable in cash, $128 , 819 . 00 to be paid by the HRA and $21 , 181 . 00 to be paid by Prairie Village Limited Partnership . On November 19 , 1985 the chairman and administrator of the HRA executed said Purchase Agreement and Property Management Agreement . On November 23 , 1985 the Parcel was conveyed by the HRA to Prairie Village Limited Partnership for $21 , 181 . 00 . The $128 , 819 . 00 originally paid by the HRA was subsequently reimbursed to the HRA in a Community Development Block Grant. As of today ' s date , the preliminary draft of the Tax Increment Finance Plan for Tax Increment Financing Distract No . 10 has undergone several changes . The original proposal for the Project included one 56-unit apartment Page -6- building for lower income elderly persons and one 56-unit apartment building in which at least 200 of the units would be reserved for tenants whose adjusted gross income did not exceed 80% of Minneapolis/ St. Paul metropolitan statistical area median income . The Project now includes one 56-unit apartment building for lower and moderate income elderly persons and. one 56-unit apartment building to be rented at market rates . It is contemplated that the project will be partially financed through the sale of $6 , 000 , 000 . 00 Housing Revenue Bonds . The proposed Interest Reduction Program will cover the entire Project, but be applied to assist in financing the 56-unit apartment building for elderly low and moderate income tenants . Based upon the evidence and the record the Council sets forth its further specific- reasons and facts supporting its Findings as follows : I. The Tax Increment Financing District No . 10 contained in the Tax Increment Financing Plan for Tax Increment Financing District No . 10 consists of one parcel legally described as all of Outlot B and that part of Outlot C, Gonyea 4th Addition lying northwesterly of a line drawn from a point on the westerly line of said Outlot C distant 92 . 68 feet southeasterly along said westerly line from the most westerly corner of said Outlot C to a point on the northerly line of said Outlot C distant 159 . 24 feet southwesterly along said Page -7- northerly line from the most northerly corner of said Outlot C. (Tax Increment Financing District No . 10 is hereinafter referred to as the "TIF District No . 10" ; Tax Increment Financing Plan for TIF District No . 10 is hereinafter referred to as the "TIF Plan" ; and the property located within the TIF District No . 10 and identified above is hereinafter_ referred to as the "Parcel " ) . II . The Project consists of development of a residential complex containing two 56-unit apartment buildings and their accessory land uses . 56 units are intended for elderly low and moderate income households and the other 56 units will be made available at market rate . The Project has an estimated development cost of $6 , 000 , 000 . 00 and will be partially financed through the sale of Housing Revenue Bonds . The Parcel has been purchased by the Eden Prairie Housing and Redevelopment Authority and has been sold to Prairie Village Limited Pa-tnership , the developer . III . 3 The Project will result in increased housing and low or moderate income elderly housing in the City and it will preserve and enhance the quality of life of the City by providing a range of housing opportunities . Page -8- Establishment of. TIF District No . 10 is intended to aid in financing of the Project through the use of tax increi.ents generated from the captured assessed value in the TIF District No . 10 . TIF District No . 10 is , therefore , a tax increment financing district as defined by Minnesota Statutes , Section 273 . 73 , Subd . 9 . V. The Project, is a housing development project under Minnesota Statutes Section 462 . 421 . The Project is intended for occupancy in part by persons or families of low and moderate income as defined in Chapter 462A, Title II of the National Housing Act of 1934 , the National Housing Act of 1959 , the United States Housing Act of 1937 , as amended , Title V of the Housing Act of 1949 , as amended, any other similar 5- present or future federal , state or municipal legislation , or the regulations promulgated under any of these acts and constitutes a housing district as defined in Minnesota Statutes Section 273 . 73 . VI. If the Project were financed with a conventional mortgage , 'the rents which would be needed to meet the mortgage payments would be so high that they would not be obtainable on today ' s market . The Interest Reduction Program, together with the mortgage revenue bond financing , will allow rent to be set at such levels as to qualify it as a low or moderate income development and will make the project economically feasible. For these reasons the use of tax increment financing for construction of the Project is deemed necessary. Page -9- VII . The Parcel described in the Plan is located entirely within the •E t ry --2-r- 1 Redevelopment Project Area created and established pursuant -to the Redevelopment Plan adopted by the City Council on November 5 , 1985 , and Minnesota Statutes Chapter 462 . The Redevelopment Plan is incorporated in the TIF Plan. The TIF Plan and Project have been reviewed by the City ' s Planning Commission and found to be in conformity with the previously adopted Redevelopment Plan and the general plan for development of the City . For these reasons , the TIF Plan conforms to the general plan for development or redevelopment of the City as a whole and will afford maximum opportunity consistent with the sound needs of the City as a whole for the development of the district by private enterprise .