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CITY OF RAMSEY, MINNESOTA
<br />' NOTES TO FINANCIAL STATEMENTS
<br />December 31,1997
<br />' Note 7. TAX INCREMENT FINANCING REVENUE NOTES
<br />The City entered into several private development agreements during 1991, 1996, and 1997. Contemplated in the
<br />' development agreements were .the reimbursements to each of the developers for special trunk assessments. The
<br />vehicle used for this reimbursement is called a tax increment revenue note. The original assessments are as
<br />follows:
<br />' Chestnut Hills $ 205,300
<br />Cedar Hills 234,042
<br />Windemere Woods 106,756
<br />Energy Park Second Addition #1 455,855
<br />Energy Park Second Addition #2 56,628
<br />Energy Park Third Addition 167,344
<br />Total $ 1,225,925
<br />During 1991, the City entered into private development agreements for Chestnut Hills, Cedar Hills, and
<br />' Windemere Woods. The City agreed to reimburse the developers through. future potential tax increments
<br />received from these developments. These notes provide for the payment of principal and interest (8%) up to the
<br />lessor of the note or 97% of available tax increment from these developments. The notes began accruing interest
<br />on December 1, 1993, with the first payment due to the developers on February 1, 1995, for tax increments
<br />received during 1994. The last payment will be February 1, 2000, based on increments received during 1999.
<br />Each developer receives only the increments generated by their subdivision. Payments from available increments
<br />are applied first to accrued interest and then to principal balances. If increments received through the year 1999
<br />' are not sufficient to pay off each developer, the note will be cancelled. Excess increments, if any, received after
<br />1999, will be retained by the City.
<br />During 1996, the City entered into two private development agreements for the Energy Park Second Addition.
<br />The City agreed to reimburse the developers through future potential tax increments received from this
<br />development. Per the agreement document, the City will pay on each scheduled payment date up to the lessor of
<br />the net tax increment collected from this development or the scheduled payment due (with interest included in the
<br />payment of 8%). The first note begins accruing interest on January 1, 1998, with the first payment due to the
<br />developers on December 15, 1998, and the second note on January 1, 2003, with the first payment due to the
<br />developers on December 15, 2003, respectively. For both agreements, the final payments will be December 15,
<br />' 2005, for tax increments received during 2005. Payments from available increments are applied first to accrued
<br />interest and then to principal balances. Any excess increments received after 2005 will be retained by the City.
<br />' During 1997, the City entered into a private development agreement for the Energy Park Third Addition. The
<br />City agreed to reimburse the developer through future potential tax increments received from this development.
<br />Interest shall accrue on the principle amount of $167,344 through the period ending December 31, 1999 at the
<br />rate of 0% per annum, and from January 1, 2000, and thereafter at the rate of 8% per annum. The scheduled
<br />payment due on any scheduled payment date is payable solely from and only to the extent that the City shall
<br />have received, as of such scheduled payment date, net tax increment. The first payment due the developer will
<br />be on December 15, 2000. The final payment is scheduled for December 15, 2005. Any excess increments
<br />' received after 2005 will be retained by the City.
<br />Included in current liabilities for the year ended December 31, 1997, is $140,419, which represents the portion of
<br />' increments collected in 1997 that were payable to the developers on February 1, 1998. These payments are
<br />recorded as capital outlay as they represent a payment for trunk infrastructure contributed by the developers.
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