Loading...
HomeMy WebLinkAboutResolution - 2017-103 - Elevate Establish TIF District 22, Adopt TIF Plan and Modify Redevelopment Plan - 10/03/2017 CITY OF EDEN PRAIRIE HENNEPIN COUNTY STATE OF MINNESOTA RESOLUTION NO.2017-103 RESOLUTION ADOPTING A MODIFICATION TO THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT AREA NO. 5 AND ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 22 (ELEVATE APARTMENTS) THEREIN AND ADOPTING A TAX INCREMENT FINANCING PLAN THEREFOR. 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 of the Eden Prairie Housing and Redevelopment Authority (the "HRA")has heretofore established Redevelopment Project Area No. 5 and adopted a Redevelopment Plan therefor. It has been proposed by the HRA and the City that the City adopt a Modification to the Redevelopment Plan (the "Redevelopment Plan Modification") for Redevelopment Project Area No. 5 (the "Project Area")and establish Tax Increment Financing District No. 22 (Elevate Apartments)(the "District")therein and adopt a Tax Increment Financing Plan (the "TIF Plan")therefor(the Redevelopment Plan Modification and the TIF Plan are referred to collectively herein as the "Plans"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.001 to 469.047 and Sections 469.174 to 469.1794,all inclusive, as amended, (the "Act")all as reflected in the Plans,and presented for the Council's consideration. 1.02. The HRA and City have investigated the facts relating to the Plans and have caused the Plans to be prepared. 1.03. The HRA and City have performed all actions required by law to be performed prior to the establishment of the District and the adoption and approval of the proposed Plans, 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 District, approval of the Plans by the HRA on September 18,2017, and the holding of a public hearing upon published notice as required by law. 1.04. Certain written reports(the"Reports")relating to the Plans and to the activities contemplated therein have heretofore been prepared by staff and consultants and submitted to the Council and/or made a part of the City files and proceedings on the Plans. The Reports include data, information and/or substantiation constituting or relating to the basis for the other findings and determinations made in this resolution. The Council hereby confirms, ratifies and adopts the Reports, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. 1.05. The City is not modifying the boundaries of Project Area, but is however, modifying the Redevelopment Plan therefor. Section 2. Findings for the Adoption and Approval of the Redevelopment Plan Modification 2.01. The Council approves the Redevelopment Plan Modification, and specifically finds that: (a)the land within the Project Area would not be available for redevelopment without the financial aid to be sought under this Redevelopment Plan; (b)the Redevelopment Plan, as modified,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(c)that the Redevelopment Plan, as modified, conforms to the general plan for the development of the City as a whole. Section 3. Findings for the Establishment of Tax Increment Financing District No. 22 (Elevate Apartments). 3.01. The Council hereby finds that Tax Increment Financing District No. 22 (Elevate Apartments) is in the public interest and is a"housing district" under Minnesota Statutes, Section 469.174, Subd. 11 of the Act. 3.02. The Council further finds that the proposed development would not occur solely through private investment within the reasonably foreseeable future,that the Plans conform to the general plan for the development or redevelopment of the City as a whole; and that the Plans will afford maximum opportunity consistent with the sound needs of the City as a whole,for the development or redevelopment of the District by private enterprise. 3.03. The Council further finds, declares and determines that the City 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. Section 4. Public Purpose. 4.01. The adoption of the Plans conforms in all respects to the requirements of the Act and will help fulfill a need to develop an area of the City which is already built up,to provide housing opportunities, to improve the tax base and to improve the general economy of the State and thereby serves a public purpose. For the reasons described in Exhibit A,the City believes these benefits directly derive from the tax increment assistance provided under the TIF Plan. A private developer will receive only the assistance needed to make this development financially feasible. As such, any private benefits received by a developer are incidental and do not outweigh the primary public benefits. Section 5. Approval and Adoption of the Plans. 5.01. The Plans, 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. 5.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plans and to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 5.03 The Auditor of Hennepin County is requested to certify the original net tax capacity of the District, as described in the Plans, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the HRA is authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify,together EXHIBIT A RESOLUTION NO. 2017-103 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing District No. 22 (Elevate Apartments), as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that Tax Increment Financing District No. 22 (Elevate Apartments) is a housing district as defined in M.S., Section 469.174, Subd. 11. TIF District No. 22 (Elevate Apartments)consists of two parcels. The development will consist of approximately 222 apartment units and 13,266 square feet of commercial space. A portion of the housing units will receive tax increment assistance and will meet income restrictions described in M.S. 469.1761. At least 20 percent of the units(45 apartments)receiving assistance will have incomes at or below 50 percent of statewide median income. Appendix E of the TIF Plan contains background for the above finding. 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: This finding is supported by the fact that the development proposed in this plan contains affordable,workforce housing units that meet the City's objectives for development. The cost of land acquisition, site and public improvements and construction makes this housing development infeasible without City assistance. The cost of land acquisition and construction are the same for workforce housing units as they are for market rate projects. The decreased rental income from the affordable units, means there is less cash flow available to service the operating and debt expenses for the project. The leaves a gap in funding for the project. The need to offset this reduction in rents for the workforce housing units makes this housing development feasible only through assistance, in part, from tax increment financing. The developer was asked for and provided a letter and a pro forma as justification that the project would not have gone forward without tax increment assistance. The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan: This finding is justified on the grounds that the costs of acquisition, building demolition, site improvements, utility improvements and construction of affordable housing add to the total redevelopment cost. Historically,the costs of site and public improvements,as well as high market rate rents in the City have made development of affordable housing infeasible without tax increment assistance. Although other projects could potentially be proposed,the City reasonably determines that no other redevelopment of similar scope providing the desired affordability can be anticipated on this site without substantially similar assistance being provided to the development. 3. Finding that the TIF Plan for Tax Increment Financing District No. 22 (Elevate Apartments) conforms to the general plan for the development or redevelopment of the municipality as a whole. The City finds that the TIF Plan conforms to the general development plan of the City. The TIF Plan is consistent with amendments approved by the City Council to the Comprehensive Guide Plan and zoning. 4. Finding that the TIF Plan for Tax Increment Financing District No. 22 (Elevate Apartments) 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 project to be assisted by the District will result in diversified housing opportunities and increased employment and increased tax base in the City and the State of Minnesota, and the addition of a high-quality development to the City. with a list of all properties within the District, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution. 5.04. The City Clerk is further authorized and directed to file a copy of the Plans with the Commissioner of the Minnesota Department of Revenue and the Office of the State Auditor pursuant to Minnesota Statutes 469.175, Subd. 4a. ADOPTED by the City Council of the City of Eden Prairie this 3rd day of October, 2017. 4n4ra-�'Zs, ayor ATTEST: It 94194 OF f Ka t een Porta, City Clerk