Agenda - Council - 06/25/2024 - Laserfiche WebLink

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NOTE 15 — TAX ABATEMENT AGREEMENTS(CONT1NUED) The City issued these five agreements through the economic development vehicle known as tax increment financing whereby tax increment revenue is generated on the incremental increase in value above a base established on the date that the tax increment district is created. Per these agreements, the developer shall initially pay for the development property and any site improvements with the City reimbursing these expenses through the issuance of a tax increment revenue note payable solely from the tax increments generated from the project. The City is authorized to create a tax increment financing plan under Minnesota Statute 469.175. Under this statute, the following criteria must be met: • Proposed development or redevelopment would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future; • The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the district permitted by the plan. The requirements of this item do not apply if the district is a housing district; • The tax increment financing plan conforms to the general plan for the development or redevelopment of the municipality as a whole; • The tax increment financing plan will afford maximum opportunity, consistent with the sound needs of the municipality as a whole, for the development or redevelopment of the project by private enterprise. For the fiscal year ended December 31, 2023, the City abated property taxes totaling $727,022 related to the following: • Housing Development: $53,400 abated towards a $711,000 Tax Increment Revenue Note issued in 2004 for the construction of a 31-unit townhome project. Final note payment date is February 2024. • Redevelopment: $243,724 abated towards a $3,000,000 Tax Increment Revenue Note issued in 2015 for the construction of a 230-unit apartment building. Final note payment date is February 2038. • Redevelopment: $45,906 abated for a $218,000 Tax Increment Revenue Note issued in 2019 for a 56,000 square -foot industrial building in Bunker Lake Business Park. Final note payment date is February 2028. • Housing: $240,028 abated for a $681,395 Tax Increment Revenue Note issued in 2020 for a 174-unit senior living facility. Final note payment date is February 2040. • Redevelopment: $143,964 abated for a $972,000 Tax Increment Revenue Note issued in 2021 for a 210,000 square -foot manufacturing building in Bunker Lake Business Park. Final note payment date is February 2030. 95