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HomeMy WebLinkAboutResolution - HRA 2008-02 - Amendment to TIF Plan TIF District No. 15 - 07/15/2008 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF EDEN PRAIRIE HENNEPIN COUNTY, MINNESOTA H.R.A. RESOLUTION NO. 2008-02 A RESOLUTION APPROVING THE AMENDMENT TO THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 15. BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the Housing and Redevelopment Authority in and for the City of Eden Prairie, Minnesota (the "Authority"), as follows: Section 1. Recitals. 1.01. On December 17, 1996, the City, pursuant to Minnesota Statutes section 469.001 to 469.047, as amended, approved a redevelopment plan, as defined in Minnesota Statutes Section 469.002, subdivision 16, designated as the Project Plan (the "Project Plan") for redevelopment Project No. 5 (the "Project Area") and a redevelopment project to be undertaken pursuant thereto, as defined in Minnesota Statutes Section 469.002, Subdivision 14 (the "Redevelopment Project"). 1.02. Pursuant to the Minnesota Tax Increment Financing Act, Minnesota Statutes Sections 469.174 to 469.179, as amended (the "Act"), the Eden Prairie City Council (the "Council") established Tax Increment Financing District No. 15 (the "District") and adopted a Tax Increment Financing Plan therefor (the "Original TIF Plan") on July 20, 1999. The District comprises one tax parcel within the Redevelopment Project. The Amendment to Tax Increment Financing Plan for Tax Increment Financing ("Qualified Housing"), District No. 15 (Eden Shores Senior Housing Campus, Phase II Expansion) (the "Amended TIF Plan") is now before this Authority for approval and application to the Council for approval. The Amended TIF Plan has been prepared in accordance with the Project Plan and is the proposed method for financing certain public redevelopment costs of redevelopment activities more fully set forth in the Amended TIF Plan. 1.03. Members of the board of County Commissioners of Hennepin County and of the Board of Education of Independent School District No. 272 have been given an opportunity to meet with the City and comment on the Amended TIF Plan. Pursuant to Minnesota Statutes Section 469.175, Subdivisions 3 and 4, the Council on July 15, 2008, conducted a public hearing on the desirability of approving the Amended TIF Plan. Notice of the public hearing was duly published as required by law in the Eden Prairie News, the official newspaper of the City, on July 3, 2008. The City has not received written comments on the Amended TIF Plan from the county and the school district after providing the county and the school district boards with information on the fiscal and economic implications of the Amended TIF Plan not less than 30 days before the date of the public hearing. 1.04. In addition to the notice and opportunity described in Section 1.03, as required by Minnesota Statutes Section 469.175, Subdivision 2a, the City, not less than 30 days before the publication of the notice of public hearing referred to in Section 1.03 delivered written notice to the members of the Board of County Commissioners of Hennepin County who represent the District. The notice contained a general description of the boundaries of the District, the proposed development activities to be undertaken therein, an offer by representatives of the City to meet and discuss the proposed District with county commissioner and solicitation of the commissioner's comments with respect to the District. 2. Approval of Amended TIF Plan. On the basis of the Amended TIF Plan and the information elicited at the public hearing referred to in Section 1.03, it is hereby found, determined and declared: 2.01 This Authority hereby finds that the District is a Qualified Housing District. 2.02 This Authority hereby finds that the private redevelopment proposed to be encouraged in the Redevelopment Project pursuant to the Amended TIF Plan would not, in the opinion of this Authority, occur solely through private investment within the reasonably foreseeable future and that therefore the use of tax increment financing is deemed necessary. Without tax increment financing of the costs of redevelopment activities generally described by the Project Plan which increases the financial feasibility of the proposed redevelopment, private investment would not develop the District within the reasonably foreseeable future. 2.03 This Authority hereby finds that the Amended TIF Plan conforms to the general plan for the development of the City as a whole. 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 Land Use Plan. 2.04 This Authority hereby finds that the Amended 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. The redevelopment activities contemplated in the Amended TIF Plan would help to retard blight in the Redevelopment Project and provide an increase in low and moderate income housing opportunities in the City and enhance the tax base of the City. 2.05 As required by Section 49.176, 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. 2.06 Upon review of the Amended TIF Plan, the information elicited at the public hearing and on the basis of the findings in Sections 2.01 to 2.05, this Authority hereby approves the Amended TIF Plan and applies to the Council for its approval. 2.07 The Authority further finds, declares and determines that the Authority made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit A. 2 Section 3. Additional Approvals. 3.01 The Amended TIF Plan, as presented to the council on this date, including without limitation the findings and statements of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the Finance Manager. 3.02 The Finance Manager is further authorized and directed to file a copy of the Amended TIF Plan with the Commissioner of the Minnesota Department of Revenue and the Office of the State Auditor pursuant to Minnesota Statutes section 469.175, Subd. 4a. 3.03 It is contemplated the public financial contribution contemplated in the Amended TIF Plan, 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 Amended TIF Plan 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 furnish 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. Passed by the Board of Commissioners of the Authority this 151h day of July, 2008. By: Chairman Attest: Executive Director 3 Exhibit A RESOLUTION NO. 2008-71 The reasons and facts supporting the findings for the Amendment of Tax Increment Financing Plan for Tax Increment Financing District No. 15 ("Amended TIF Plan"), as required pursuant to Minnesota Statutes, Section 469.175, Subdivisions 3 and 4 are as set forth below. The studies and analyses supporting these findings are also identified and fully set forth in the Amended TIF Plan. 1. Finding that TIF District No. 15 District is a Qualified Housing District. This Authority hereby finds that the District is a geographic area within a"project' as defined in Minnesota Statutes Section 469.174, Subdivision 8, and is a proper tax increment financing district within the meaning of Section 469.174, Subdivision 9. This Authority further finds, based on the information in the Original TIF Plan, the Amended TIF Plan, and representations of the developer, that the District 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 1937, as amended, or similar federal legislation and the regulations promulgated thereunder. As evidence thereof, the developer represents that the project qualifies for the low-income housing tax credit under Section 42 of the Internal Review Code of 1986, as amended. In 2001, 265 units were developed in the District. In accordance with the applicable state requirements for qualified housing districts, at the time of District creation, it was determined that 20% of the total units created would not be subject to the low and moderate income requirements. This reduced the number of units subject to the requirements to 212 units, of which 20% of these units (43 units) are required to be occupied by individuals at or below 50% of the area median income, and have monthly rents of no more than 30% of maximum monthly gross income. The new project to be constructed in the District consists of an 80 unit memory care facility and no commercial or other uses are contemplated therein. 20%of the 80 units to be constructed, or 16 units, shall be made to be affordable in Phase I of the development. The District currently qualifies as a "housing district' and is maintaining affordability of 43 units. The District will continue to qualify as a"housing district'when the additional 16 units are made affordable. Therefore, the District qualifies as a "housing district' within the meaning of Minnesota Statutes Section 469.174, Subdivision 11. The income limitations of Section 469.1761 of the Act are applicable to tenants in the project, because the District is not located in a targeted area as defined in Minnesota Statutes Section 462C.02, Subdivision 9, Clause (e). 2. Finding that the proposed development, in the opinion of the Authority, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future. The developer has represented to the Authority and the City that the proposed development would not be feasible without assistance through tax increment financing. Further, the developer 4 represents that it will not move forward with the development without tax increment financing support. The existing improvements on the property were constructed by the developer through tax increment financing. Construction of the current improvements on the property began in 1999. The construction was carried out only after the City agreed to provide tax increment financing support. Prior to that, the property was not developed through private investment. Since the development of the current improvements, the vacant portion of the property has remained undeveloped. The Authority does not expect the vacant portion of the property to be developed through private investment within the reasonably foreseeable future. 3. Finding that the Amended TIF Plan for the District conforms to the general plan for the development or redevelopment of the municipality as a whole. The City's Comprehensive Guide Plan ("Guide Plan") currently 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. 4. Finding that the Amended TIF Plan for the District will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Redevelopment Project Area No. S by private enterprise. The development will provide many benefits to the City. The benefits will include an increase in safe and affordable housing for the City's elderly citizens, an increase in the number of jobs available to City residents, and the development of currently underdeveloped land thus increasing the City's tax base. Further, the development will result in an overall increase in the general health, safety and welfare of the citizens of the City. By providing tax increment financing support, the City will enable private enterprise to develop the property thus providing these benefits to the City. 5