Agenda - Economic Development Authority - 03/10/2022

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.EHLERS III PUBLIC FINANCE ADVISORS the County under a development agreement with the City (or possibly under a contract with the County to complete the demolition on the City's behalf). For each resolution passed in connection with a parcel to be acquired, the City should include a provision documenting an inter -fund loan (IFL). Inclusion of IFL language in the resolution is the mechanism that will allow the City to reimburse itself from future tax increment for any costs that the City incurs now related to: • Property acquisition • Relocation • Demolition • Site preparation The IFL will identify a maximum reimbursement amount that should be set sufficiently high to cover all the City's anticipated expenses for that particular property, knowing the City will only draw the amount actually needed for the IFL. If the City does not create a redevelopment TIF district within three years of demolishing the building(s), then the opportunity to use redevelopment TIF as a tool for any project will have passed. At that point, the City's ability to use TIF on this site would be limited to: • Creation of an economic development TIF district, provided 85% of the buildings and facilities (determined on the basis of square footage) are be used for manufacturing and warehousing: • Creation of a housing TIF district, only if the district includes: (1) A rental housing project in which at least 20% of the units are affordable to those at 50% of area median income (AMI), or 40% of the units are affordable to those at 60% of AMI; or (2) An owner -occupied residential project in which at least 95% of the housing units are initially purchased and occupied by families with incomes at or below 100% AMI for a family of 2 or fewer, or 115% of AMI for a family of 3 or more. • Special legislation to create a redevelopment TIF district The City can, however, go ahead and create a redevelopment TIF district before the end of the three-year period even if there is no pending project. The City can delay receipt of first increment in that district for up to 4 years, which can preserve more time to get a project started and still benefit from the full 26 years of tax increment collections. The City would have up to five years from the date of certification of the district to enter into an agreement with a private party and provide pay-as-you-go tax increment payments that could then extend over the life of the district. Please contact me at 651-697-8512 with any questions. BUILDING COMMUNITIES. IT'S WHAT WE DO. d info@ehlers-inc.com Q 1 (800) 552-1171 www.ehlers-inc.com