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HomeMy WebLinkAboutResolution - 2011-52 - Modification to TIF District 15 Summit Place - 06/14/2011 CITY OF EDEN PRAIRIE HENNEPIN COUNTY,MINNESOTA RESOLUTION NO. 2011-52 RESOLUTION ADOPTING A MODIFICATION TO THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 5 AND THE PROPOSED ADOPTION OF A MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 15 BE IT RESOLVED by the City Council (the "Council") of the City of Eden Prairie, Minnesota(the "City"), as follows: Section 1. Recitals 1.01. The Board of Commissioners (the "Board") of the Eden Prairie Housing and Redevelopment Authority (the "HRA") has heretofore established Redevelopment Project No. 5 (the "Project Area") and adopted the Redevelopment Plan therefor. It has been proposed by the HRA that the City adopt a Modification to the Redevelopment Plan (the " Redevelopment Plan Modification") for the Project Area and a Modification to the Tax Increment Financing Plan (the "TIF Plan Modification") for Tax Increment Financing District No. 15 (the "TIF District") therein (the Redevelopment Plan Modification and the TIF Plan Modification are referred to collectively herein as the "Modifications"), all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.001 to 469.047, and Sections 469.174 to 469.1799, all inclusive, as amended, (the "Act") all as reflected in the Modifications, and presented for the Council's consideration. 1.02. Tax Increment from the TIF District has been used to pay for certain development costs and provide affordable senior housing units at Summit Place senior campus. The Modifications will allow the City and HRA to extend the term of the affordability of 43 units from 15 to 25 years, and add five additional affordable units, for a total of 48 affordable units. 1.03. The City and HRA have investigated the facts relating to the Modifications and have caused the Modifications to be prepared. 1.04. The City and HRA have performed all actions required by law to be performed prior to the adoption and approval of the proposed Modifications, including, but not limited to, notification of Hennepin County and Independent School District No. 272, having taxing jurisdiction over the property to be included in the TIF District, a review of and written comment on the Modifications by the City Planning Commission on April 11, 2011, and the holding of a public hearing upon published notice as required by law. 1.05. The City and HRA are not modifying the boundaries of the Project Area or the TIF District. Section 2. Findings for the Redevelopment Plan Modification 2.01. The Council hereby reaffirms that: (a) the Redevelopment Plan Modification will afford maximum opportunity, consistent with the needs of the City as a whole, for the development of the Project Area by private enterprise; and(b)the Redevelopment Plan Modification conforms to the general plan for the development of the City as a whole. 2.02. These findings are based on the facts and conditions described in the Redevelopment Plan Modification,which is incorporated herein by reference. Section 3. Findings for the TIF Plan Modification 3.01 The Council hereby reaffirms the original findings for the TIF District, namely that when the TIF District was established, Tax Increment Financing District No. 15 was established as a housing district. However, the City originally designated the TIF District as a "qualified housing district" under Section 469.174, subd. 29 of the Act. Legislation in 2008 repealed provisions related to qualified housing districts, effective retroactively to cover any district given that designation. Accordingly, the TIF District is no longer a "qualified housing district," but remains subject to all laws that govern housing districts as defined in the Act. In accordance with the applicable state requirements for housing districts, at the time of TIF District creation, a minimum of 43 units in Summit place are required to be occupied by individuals at or below 50%of the area median income. 3.02 It is found and determined, and it is the reasoned opinion of the City, that: (i) The proposed redevelopment described in the TIF Plan Modification would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future. The major purpose of the TIF Plan Modification is to extend the term and increase the number of affordable housing units within Summit Place. Historically, affordable housing has not occurred in the City without significant public assistance because of high land and construction costs and lower revenues produced by affordable rents or sale prices. The use of tax increment resources from the TIF District will offer opportunities for the private developer to incorporate more affordable housing in Summit Place.. By reimbursing the developer for the initial development costs of Summit Place, the City will be able to extend the term of affordability on 43 units by 10 years and make an additional 5 units affordable through 2026. The developer has represented to the City increase in affordable units would not occur without the TIF Plan Modification. (ii) The Tax Increment Plan Modification conforms to the general plan for the redevelopment of the City as a whole. The City's Comprehensive Guide Plan ("Guide Plan") guides the property as high density residential. High density residential calls for 10 to 40 residential units per acre. The Guide Plan calls for the development of housing units for seniors appropriate for the physical and mental changes they experience. The Guide Plan also encourages housing that will permit seniors to live independently and affordably. The proposed development is a high density residential development that will comply with the City's Guide Plan and general goals for providing safe and affordable housing for its citizens. The Community Development Director advises and the Council finds that the development is compatible with the City's zoning ordinances and other related regulations and encourages efficient use of existing infrastructure as set forth in the City's Guide Plan. (ill) The Tax Increment Plan Modification will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the redevelopment of the Project by private enterprise. The City has promoted affordable rental and owner-occupied housing for several years. The tax increment from the TIF District will be used to encourage the private market to offer affordable senior housing choices and ensure that affordability is maintained over an extended period of time, and promote development that links housing with transportation corridors and services. The new memory care facility will also provide construction jobs in the City during the anticipated 12 month construction period. Through the implementation of the TIF Plan, the City will increase the availability of safe and decent life-cycle housing in the City. 3.03 As required by Section 469.176, Subdivision 4d, it is expected that all of the tax increment to be derived from the District will be used to finance costs of the low and moderate income housing project, including the cost of public improvements directly related thereto and allowable administration expenses of the Redevelopment Project. 3.04 The City elects to calculate fiscal disparities for the District in accordance with Minnesota Statutes, Section 469.177, Subd. 3, clause b, which means the fiscal disparities contribution, if any, will be taken from inside the District. Section 4. Public Purpose 4.01. The adoption of the Modifications conforms in all respects to the requirements of the Act and will help fulfill a need to provide housing opportunities affordable to persons of low and moderate income and improve the tax base. These public purposes and benefits exceed any benefits expected to be received by private developers, who will receive assistance only in the amount needed to make the provision of affordable housing financially feasible. Section 5. Anroval and Adoption of the Modifications 5.01. The Modifications are hereby approved, and shall be placed on file in the office of the City Clerk. Approval of the Modifications does not constitute approval of any project or a development agreement with any developer. 5.02. City staff is authorized to file the Modifications with the Commissioner of Revenue,the Office of the State Auditor and the Hennepin County Auditor. 5.03. City staff, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Modifications and for this purpose to negotiate, draft, prepare and present to this Council for its consideration all further modifications, resolutions, documents and contracts necessary for this purpose. Section 6. Additional Approvals 6.01 It is contemplated the public financial contribution contemplated in the Modifications, including but not limited to tax increment financing may be secured by way of a mortgage on the property in the District. It is further contemplated that the developer will obtain construction and/or permanent financing and that it will be necessary for any security granted to the City and/or Authority to be subordinated to that of the developer's lender. The Approval hereby given to the Modifications includes approval and the execution by the appropriate officers of the City of such additional documents necessary to acquire a secured interest in the property and to subordinate such interest, including a contingent assignment of any agreements regarding tax increment financing between the developer and the City and/or Authority, to the lien of the developer's construction and/or permanent financing. The Mayor and City Manager are authorized and directed to prepare and fiumish certified copies of all proceedings and records of the City relating to this transaction and such other affidavits and certificates as may be required to show the facts related thereto as such facts appear on the books and records in the officers' custody and control or as otherwise known to them; all such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute representations of the City as to the truth of all statements contained therein. The approval hereby given to the various documents referred to above includes the approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by the City's counsel and the officials authorized herein to execute said documents prior to their execution; and said officials are hereby authorized to approve said changes on behalf of the City herein authorized shall be conclusive evidence of the approval of such documents in accordance with the terms hereof. ADOPTED by the Eden Prairie City Council on June 14th, 2011. a- uke , Mayor ATTEST: Ka leen Porta, City Clerk