Agenda - Council - 01/22/2008 - Laserfiche WebLink

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CASE # PUBLIC HEARING TO CONSIDER EXECUTION OF BUSINESS SUBSIDY AGREEMENT WITH ASSET RESOURCES AND ACQUISITION, LLC By: Sean M. Sullivan, Economic Development Coordinator Background: A development agreement with Asset Resources aiid Acquisition, LLC. has been negotiated with City staff.. The project. includes the construction of a 15,000 square foot office/warehouse building to be complete by December of 2008. The building will be located on Lot 5,-Block 4, Gateway North Industrial Park Plat 2 (former Dave Perkins Contracting/Eugene Brown site) in .TIF District No. 2. The companies currently have 16 employees between them -and are located in Coon Rapids. It is anticipated that the project will create at least 7 new jobs paying a wage of at least $14.00 per hour in a two-year period. The proposed land cost write down subsidy is $150,000 and this. subsidy meets the job creation criteria of one job per $25,000 of assistance set forth by-the City Council. The proposed project and assistance package has been recommended. by the Ramsey Economic Development Authority. The County Assessor has estimated an assessed taxable market value of approximately $1,400,000 for the project. It is anticipated that the project will generate $42,000 dollars annually in taxes and approximately $27,250 annually in tax capacity. The -tax 'increment generated per .year will be approximately $20,000 per year toward the TIF District, which would be used to assist the City with its payment for public improvements associated with T1F District No. 2 as well as the land cost write-down. The development agreement for this project is in excess of a 40-page document. The City has uti-lized the . consistent acid standard format except for the dollar amounts specific to the project.. Any changes in the land use are passed through to the City. Attorney for his review. Given the above, staff has attached the pertinent pages of the agreement for Council review. As Council is aware, the other sections deal with indemnity, construction documents, prohibitions against assignments, and transfer to the agreements to pay deficiencies. The entire agreement is available at City Council request. Also attached are the pertinent minutes regarding the EDA recommendation at the October 18`h EDA .Meeting. Funding Source: Tax Increment Financing District No. 2 Council Action: Motion to authorize business subsidy agreement with Asset Resources and Acquisition, LLC. - and - Motion to authorize execution of a development agreement with Asset Resources and Acquisition, LLC., contingent upon review by the Ciiy Attorney. Reviewed by: City Administrator CC:01.22.08 -101-