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MEMORANDUM <br />CITY OF HAMSEY <br /> <br />TO: <br /> <br />FROM: <br /> <br />RE: <br /> <br />DATE: <br /> <br />David Hartley, City Administrator <br /> <br />Mark S. Banwart, Community Development Director <br /> <br />Companion Dog Training & Supply (Request for T.I.F. Assistance) <br />January 27, 1989 <br /> <br />On January 26, 1989, I conferred with Ronald H. Batty, Attorney with the Law Offices of Lefevere, <br />Lefler, Kennedy, O'Brien and Drawz regarding a number of issues dealing with the above <br />mentioned subject. The three main subject areas in issue are: <br /> <br />Economic Development District <br />Redevelopment District <br />Soils District <br /> <br />The use of an Economic Development District is a given. The Redevelopment District requires a <br />factor of on the order of 70% of blight and dilapidation. With or without the selling of the abutting <br />house in the case of the Champion Dog Training & Supply firm or considering other properties in <br />the area to aggregate the problem and qualify under a redevelopment district, there is simply not <br />the criteria to qualify this project as a Redevelopment District. <br /> <br />The Soil Development District requires that the area have 80% bad soils and only T.I.F. funds can <br />be used to mitigate those bad soils (no site development). Furthermore, the T.I.F. funds in a Soils <br />District are only for 12 years. This would not measurably change the numbers from the figures <br />previously quotedas an Economic Development District. Furthermore, the Anoka Count)' Soil <br />Conservation Districts could have first dibs on the funds. <br /> <br />Therefore, the only reasonable type of T.I.F. format is the Economic Development District. <br /> <br />The question that then comes to mind is to re-examine the City's T.I.F. Policies of 70% of the tax <br />increment in urban areas and 40% of the tax increment in rural areas. Although there is an <br />ob~dous typographical error indicating a $50,000 minimum offer by the City, when in actuality it <br />was intended to be $15,000. And even though one of the applicants was present at the meeting (the <br />meeting minutes indicate that clearly it stated $36,000 with administration and engineering costs <br />is extracted (debt service)). The letter stating the $50,000 minimum (dated Ma)' 4, 1988) apparently <br />was not corrected to reflect this problem and the applicants were not notified of this problem. There <br />may be some arguable grounds for litigation against the City. <br /> <br />I recommend that we consider a policy rex-Jew of percentages of Total Increment Generated in this <br />particular case. <br /> <br />MSB:ccr <br /> <br /> <br />