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EDA LEVY AUTHORITY By: Scan Sullivan, Economic Development / TIF Specialist round: On November 28, 1998 the City Council approved a resolution creating the EDA for the City of Ramsey. The resOlution gives all the statutory powers of an Economic Development Authority (EDA) and Housing and Redevelopment Authority (HRA) to the Ramsey EDA. The EDA budget has been funded primarily through three sources: 1) the City General Fund, 2) proceeds from the sale of City owned property and 3) monies from the Landfill Closure Statement. Property tax reform implemented for taxes payable in 2002 along with levy limits, have limited the amount of funding necessary for land acquisition for redevelopment projects and hiring development consultants. It is important for the EDA to have the ability to make purchases of property, sometimes on short notice, so that it able to assemble properties in a timely manner for redevelopment. Additionally, it is also important to have adequate funding in order utilize consulting tools for development and redevelopment. The enabling resolution adopted in 1998 requires that ail recommendations by the EDA be sent to the City Council for approval before any action is taken. Observations: Recently property, west of Armstrong Boulevard, in the proposed town center area was put up for sale by a private party. EDA had given Staff direction to identify a funding source and to bring it back to EDA for consideration to buy. Staff researched this for EDA and found no readily available funds for the purchase of the Menkveld property. As with many real estate transactions, another buyer with immediate purchasing ability, stepped forward and acquired the Menkveld property while the City was twing to find a acceptable funding source. By allowing the EDA to have stable funding to supplement appropriations from the City General Fund and land sale proceeds, it would enable the EDA to make quicker recommendations to the City Council in regards to land purchases. This differs from TIF land purchases, which involve significant planning and hearings (time) and have more stringent limitations on how funds can be spent. In order to address future needs for land acquisition, participate in future redevelopment opportunities and the continue the utilization of development consultants, it would be prudent for the EDA to seek additional funding. Currently, there are three ways in which the EDA may receive funding. The first is how we fund our current EDA. We allocate money from the General fund to the EDA budget and periodically transfer money to the EDA through the sales of certain real estate transactions. Another way in which the EDA can be funded is through a requested 'EDA' Market Value Levy through the City Council. This levy is determined by multiplying all the taxable market value in the city by 0.01813%. (See Attached). This levy is, in effect, allocating a set amount of the General Fund (subject to levy 1/mits) to the EDA. This does give the EDA the ability to make quicker decisions in regards to purchases but it does not increase the overall budget of the City. The third levy type is a HRA levy. This levy is also Market Value based .and uses a percentage of 0.0144% (See Attached). The difference between the 'EDA' and 'I-IRA' levies is that the HRA levy falls outside the State imposed levy limits. This increases the amount of money that the City will be able to use for redevelopment and economic development activities. Recommendation: Based on discussion Review Checklist: City Administrator, Jim Norman Associate Planner, Megan Wald Finance Director, Diana Lund EDA: 09.04.02