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I I I I [ I I I I I I I I I I I I I I issued more than 3 months prior to the establishment of the tax increment district. Mr. Ippel stated that Ramsey is ooming up short because we must subsidize the County and School District because of the use of tax increment financing by other cities in the County. Ms. Waelti stated that school districts are not presently hurt by tax increment financing; money not going into the school district is reimbursed by the State. In using tax incre~ent financing, a city must make every effort to see that the use will generate eooncmic base or the County will be hurt. Mr. Don Greenberg inquired as to the advantage to a developer to locate in a city that had tax increment financing. Ms. Waelti stated that the major advantage would be that the city with tax increment financing oould assist the developer in getting his project off the ground sooner as they have a program in place; Coon Rapids has tax incr~nent financing in place and can get a developer going in 6 weeks and it takes a developer 12 months to get started in Minneapolis. Mr. Deener stated that tax increment financing could be used to extend sewer and water frown Ramsey's second sewer connection and the bond would be retired faster without burdening the rest of the city. Ms. Waelti agreed and added that new industrial spots would be created along the line and they could be added to the tax increment district because they located because of the sewer line and the bonds would be retired even more rapidly. Councilm~mber Schlueter inquired if the city captures the increase in tax revenue along with the assessments to the parcel for the improvements. Mr. Dee~er stated that instead of assessing, the improv~ent is included in the lot price; in affect, that asses~e_nt would not occur. Ms. Waelti stated that two cities are currently working with a combination of assessments and tax increment financing. 5~nose cities are establishing an escrow fund to reduce the cost of extending municipal services to low income housing. Mr. Dennis Donovan inquired as to what o~mes first -- establishing a tax increment project area or waiting until the d~and is there. Ms. Waelti stated that getting the first district and project on line is tough and cities should be agressive in putting those packages together; nothing will happen if you wait and then react. Mr. Gi/bert Menkveld inquired if tax increment financing can be used for residential development. Ms. Waelti replied that it can and the only reguirement is that a certain percentage of the housing has to be available for low and moderate income April 30, 1985 Page 4 of 5