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for as long as it takes to pay for those public improvements; at that time, <br />all taxes revert back to the City, County and State. <br /> <br />Ms. Waelti stated that cities should take care in using tax increment <br />financing to create new development and not as a loop hole to grab development <br />that would have occurred anyway. Ms. Waelti stated that in another year or <br />two, tax increment financing may be the only way that cities can participate <br />in development as Federal and State funds are shrinking. <br /> <br />Ms. Waelti stated that it is the city's responsibilty to decide what <br />develo.~ment comes in, how the funds are to be used, how best those funds can <br />leverage inooming development and to be able to say 'no' once in a while. <br /> <br />Ms. Waelti stated that State law requires a contract between city and <br />development when tax increment financing is used; developers gain as much from <br />tax increment financing as the city. Limitations in the law keep cities from <br />doing anything that could get the city into trouble. <br /> <br />Ms. Waelti stated that she has been tracking Ramsey for years and r~members <br />when Ramsey became a city and went from single taxation to double taxation and <br />Ramsey's realization that the city did not have that industrial/commercial <br />base that other cities have and aid formulas worked against Ramsey. Ms. <br />Waelti stated that in her personal opinion, tax increment financing is a good <br />tool for Ramsey if used responsibly. It is very important for Ramsey to kncw <br />what tax increment financing is, have City Staff full informed on how to use <br />tax increment financing, and City Council should be very involved in <br />develo.~ment work and understand tax incr~ent financing thoroughly. <br /> <br />Ms. Waelti stated that tax increment financing involves a project area with <br />tax incr~nent financing districts within the project area. The project area <br />is where the City wants public improvements to occur; it is that area where <br />public funds can be spent; and it need not be a contiguous area. Tax <br />increment financing districts are specific areas within the project area in <br />which those funds are generated. <br /> <br />Ms. Waelti stated that tax increment financing must be used to serve a class <br />of peo~ple; it can be used for peripheral lighting around a site; any utilities <br />that were previously brought in by special assessnents; and to clear blighted <br />land. <br /> <br />Councilmember Cox brought up Ham Lake's situattion for discussion; Ham Lake <br />used tax increment financing to provide public improvements and to lend to <br />developers to build facilities; there was concern with generating money to <br />take care of the bond issue. <br /> <br />Ms. Waelti stated that Ham Lake had an economic development district and was <br />not aware that the base property value, which is frozen in tax increment <br />districts, can be raised, thereby decreasing the amount of increment coming <br />into the city to pay off those bonds. Ms. Waelti stated that Anoka County is <br />fairly sophisticated in that they allow the combined use of IDB's and tax <br />increment financing. Tax increment financing cannot be used for structures; <br />it is for ground preparation and is public funds. IDB is for on-site <br />construction and is private funds. In order for a city to meet those bond <br /> April 30, 1985 <br /> <br /> <br />