Agenda - Economic Development Authority - 01/12/2012

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WHO Is EDAM? The Economic Development Association of Minnesota (EDAM) is a statewide association representing more than 500 public and private sector professionals involved with implementing state, regional or local economic development initiatives. Our legislative policies are shaped by members' unique experi- ence and understanding of the tools and tactics that are most ef- fective in positioning and marketing Minnesota as a location for corporate, small business, housing and community investment. Economic developers generally focus on financing, marketing and implementation strategies for: Developing public infrastructure; Facilitating business expansion, job creation, and rede- velopment; Attracting, training and mobilizing a skilled local workforce; Addressing local housing needs; Marketing Minnesota's benefits as a place to live and locate a business. INTRODUCTION Economic Development creates and retains jobs and increases incomes. This is done through enhancing human capital, sup- porting entrepreneurship, developing community infrastructure, marketing to targeted industries, and promoting business develop- ment and retention. EDAM's legislative policies are established through surveying our members and consulting with our partners. EDAM anticipates that the nation's and the state's economic recovery will be slow and not uniform. Businesses that ultimately create the jobs that grow the economy will do so based on the de- mand for goods and services. Federal stimulus programs will take time to bear fruit and will not solve all economic problems. Not- withstanding the current deficit and economic challenges, EDAM encourages the State of Minnesota to look at both short -term and long -term goals in its development strategies. EDAM and its members support continued investment in economic develop- ment programs so that Minnesota remains competitive with other jurisdictions both nationally and internationally. I. ENHANCING TAX INCREMENT FINANCING (TIF) AS AN ECONOMIC DEVELOPMENT TOOL With the current economic situation, there is a need to re- evaluate current economic development parameters and statu- tory restrictions that inhibit projects at the local level in the State of Minnesota. Tax Increment Financing remains the most viable tool for economic development and community reinvest- ment efforts. Tax Increment Financing (TIF) is a method local governments use to pay for the costs of qualifying improve- ments necessary to create new development, redevelopment, or publicly assisted housing. The financing of the qualifying improvements is paid from the increased property taxes gener- ated from the new development, redevelopment, or housing that would not occur "but for" such assistance. In light of the economic challenges in Minnesota and in our country, there are steps that the State could take that would enhance the effective- ness of TIF and generate more jobs and tax base. To spur additional development, EDAM encourages the Min- nesota Legislature to undertake the following targeted, time - specific changes in the State's Statutes: a. Lengthen the duration of Economic Development TIF benefits to a full 9 years. This would save com- munities money, leverage more private investment in communities, and it would not have a fiscal impact in the State's budget. b. Strengthen the Redevelopment TIF Statute so that project areas would qualify in which 50% or more of buildings are found to be substandard. II. DEED ECONOMIC DEVELOPMENT AND REDEVELOPMENT PROGRAM FUNDING Brownfields investments create vibrant new urban places and replace lost jobs and taxes on sites where former industrial uses have left a legacy of blight and contamination. The 2010 US Conference of Mayors survey found that, among 150 sur- veyed cities, more than 86% reported successfully redeveloping brownfields. These 116 cities accounted for 2,667 sites (11,000 acres) cleaned up and redeveloped, accommodating 75,000 jobs and generating $108 million in new local tax revenue. On the average, $1 of public investments in brownfields has been shown to leverage $8 in total investment. Brownfields investment also