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CR 05-082 Tax Increment Dist 1-3 CITY OF June 28, 2005 m Council Report 2005-082 HOPKINS TAX INCREMENT DISTRICT 1-3 Proposed Action Staff recommends approval of the following motion: schedule public hearing for Julv 19 to consider Resolution 2005-055. modifving the redevelopment plan for Redevelopment Proiect I and establishing Tax Increment District 1-3 therein and adopting a tax increment financing plan therefore. subiect to HRA approval ofHRA Resolution 430. Overview Over the last several months, staff and the City Council have been working with GPS Financial Group to undertake a redevelopment project on the block bounded by Fifth and Sixth Avenues, north of Main street and south of First Street North (Block 64). The proposed project would consist of approximately 220 condominium housing units and 8,800 square feet of retail space. Staff has also been working with The Cornerstone Group on a redevelopment project for the property north of Mainstreet between Sixth and Eighth Avenues. Tax Increment District 1-3 would encompass a number of parcels between Fifth and Eighth Avenues, north of Main street and south of First Street North. (A map is located within the plan document.) The proposed district would be a redevelopment district. A property inspection report was prepared by LHB with a determination that the subject area meets statutory qualifications for this type of district. The establishment of the district does not obligate the City or HRA to provide tax increment assistance. The Planning Commission approved a resolution on May 31,2005, with a finding that the proposed district is in conformance with the City's Comprehensive Plan. The City Council, acting as the HRA, will also need to take action on the establishment of the district. Issue to Consider · What is the basis for the staff action? Supporting Documents . Resolution 2005-055 · Modification to redevelopment plan for Redevelopment Project I and the tax increment plan for the establishment of Tax Increment Financing District 1-3 within Redevelopment Project 1, dated June 1,2005 · Zon' g P nn' g Commission Resolution RZ05-16 Jim Ke gan Planning & Economic Development Director Financial Impact: $ 0 N/A _ Budgeted: Y/N _ Source: Related Documents (CIP, ERP, etc.): Notes: Council Report 2005-082, June 24, 2005 - Page 2 Issue to Cousider . What is the basis for the staff actiou? At a public hearing on June 21, information was provided to the City Council by Bradley Gunn of Leonard Street and Deinard concerning the establishment ofTIF District 1-3. Their office represents the owners of the Hopkins Park Plaza property, which is located in the proposed TIF district boundaries. The information that was provided expresses their objections to and concerns over the use of tax increment financing for the redevelopment of Block 64 and the creation of a tax increment district. Mr. Gunn also stated that Hopkins Park Plaza LLC has entered into a purchase agreement to sell the Park Plaza property to Spyder Development, L.L.c. He provided the Council with a preliminary site plan detailing Spyder Deve]opment's proposed project for this block. Staff is now recommending that action on the creation ofTIF District ]-3 be continued to a public hearing on July] 9. This action is being recommended in response to the following: . A letter has been sent to Leonard Street and Deinard asking them to provide additional information on the development proposal by Spyder Deve]opment for Block 64. This information is being requested to be submitted to Bob Lindall of Kennedy and Graven by no later than July 8, 2005. . LHB has been requested to provide the concerns detailed by Leonard Street and Deinard in their letter dated June 2], 2005, regarding the inspection of properties within the proposed project area and the subsequent conditions analysis. Also, staff is presently negotiating a development agreement with GPS Development, LLC, for the redevelopment of Block 64. The tentative schedule is to bring this agreement to the City Council for consideration at the July 19 meeting. CITY OF HOPKINS HENNEPIN COUNTY STATE OF MINNESOTA Council member introduced the following resolution and moved its adoption: RESOLUTION NO. 2005-055 RESOLUTION ADOPTING A MODIFICATION TO THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO.1; AND ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 1-3 THEREIN AND ADOPTING A TAX INCREMENT FINANCING PLAN THEREFOR. BE IT RESOLVED by the City Council (the "Council") of the City of Hopkins, Minnesota (the "City"), as follows: Section 1. Recitals 1.01. The Board of Commissioners (the "Board") of the Hopkins Housing and Redevelopment Authority (the "HRA") has heretofore established Redevelopment Project No. I and adopted the Redevelopment Plan therefor. It has been proposed by the HRA and the City that the City adopt a Modification to the Redevelopment Plan for Redevelopment Project No. I (the "Redevelopment Plan Modification") and establish Tax Increment Financing District No. 1-3 (the "District") therein and adopt a Tax Increment Financing Plan (the "TIF Plan") therefor (the Redevelopment Plan Modification and the TIF Plan are referred.to collectively herein as the "Plans"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.001 to 469.047 and Sections 469.174 to 469.1799, all inclusive, as amended, (the "Act") all as reflected in the Plans, and presented for the Council's consideration. 1.02. The HRA and City have investigated the facts relating to the Plans and have caused the Plans to be prepared. 1.03. The HRA and City have performed all actions required by law to be performed prior to the establishment of the District and the adoption and approval of the proposed Plans, including, but not limited to, notification ofHennejlin County and Independent School District No. 270 having taxing jurisdiction over the property to be included in the District, a review of and written comment on the Plans by the City Planning Commission, approval of the Plans by the HRA on June 7, 2005, and the holding ofa public hearing upon published notice as required by law. 1.04. Certain written reports including, the TIF application, Redevelopment and Blight Analysis by LHB dated May 2005, Block 64 Redevelopment Relocation Plan by Wilson Development Services dated January, 2005, Market Analysis Hopkins Main Street Residential Campus by GPS Financial Group dated March 2005, (the "Reports") relating to the Plans and to the activities contemplated therein have heretofore been prepared by staff and consultants and submitted to the Council and/or made a part of the City files and proceedings on the Plans. The Reports include data, information and/or substantiation constituting orrelating to the basis for the other [mdings and determinations made in this resolution. The Council hereby confirms, ratifies and adopts the Reports, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. 1.05 The City is not modifying the boundaries of Redevelopment Project No. L Section 2. Findings for the Adoption and Approval of the Plans 2.01. The Council hereby finds that the Plans, are intended and, in the judgment of this Council, the effect of such actions will be, to provide an impetUs for development in the public interest and accomplish certain objectives as specified in the Plans, which are hereby incorporated herein. Section 3. Findings for the Establishment of Tax Increment Financing District No. 1-3 3.01. The Council hereby finds that the District is in the public interest and is a "redevelopment district" under Minnesota Statutes, Section 469.174, Subd. 10 (a)(I). 3.02. The Council further finds that the proposed redevelopment would not occur solely through private investment within the reasonably foreseeable future and that 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 Tax Increment Financing Plan, that the Plans conform to the general plan for the development or redevelopment of the City as a whole; and that the Plans will afford maximum opportunity consistent with the sound needs of the City as a whole, for the development or redevelopment of the District by private enterprise. 3.03. The Council further finds, declares and determines that the City made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached her~to as Exhibit A. 3.04. The Hopkins Housing and Redevelopment Authority elects to calculate fiscal disparities for the District in accordance with Minnesota Statutes, Section 469.177, Subd. 3, clause b, which means the fiscal disparities contribution would be taken from inside the District. Section 4. Public Puroose 4.01. The adoption of the Plans conforms in all respects to the requirements of the Act and will help fulfill a need to develop an area of the City which is already built up, to remove, prevent and reduce blight, blighting factors and the causes of blight, to prepare the area for redevelopment in accordance with the Redevelopment Plan, to provide employment opportunities, to improve the tax base and to improve the general economy of the State and thereby serves a public purpose. Section 5. Approval and Adoption of the Plans 5.01. The Plans, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the City Clerk. 5.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plans and to negotiate, draft, prepare and presentto this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 5.03 The Auditor of Hennepin County is requested to certify the original net tax capacity of the District, as described in the Plans, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the Hopkins Housing and Redevelopment Authority is authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify, together with a list of all properties within the District, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution. 5.04. The City Clerk is further authorized and directed to file a copy of the Plans with the Commissioner of the Minnesota Department of Revenue pursuant to Minnesota Statutes 469.175, Subd. 4a. The motion for the adoption of the foregoing resolution was duly seconded by Council member , and upon a vote being taken thereon, the following voted in favor thereof: and the following voted against the same: Dated: June 21, 2005 ATTEST: Mayor City Clerk (Seal) EXHIBIT A RESOLUTION NO. The reasons and facts supporting the findings for the Modification of the Redevelopment Plan for Redevelopment Project No.1 (pursuant to Minnesota Statutes, Section 469.001 to 469.047) and the adoption of the Tax Increment Financing Plan (TIF Plan) for Tax Increment Financing District No. 1-3 (District), as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that Tax Increment Financing District No. 1-3 is a redevelopment district as defined in MS., Section 469.174, Subd. 1O(a)(1). The District consists of 25 parcels, with plans to redevelop the area for housing and commercial purposes. At least 70 percent of the area of the parcels in the District are occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures and more than 50 percent of the buildings in the District, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance. (See Appendix F of the TIF Plan.) 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that 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 Tax Increment Financing District No. 1-3 permitted by the TIF Plan. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: This finding is supported by the fact that the redevelopment proposed in this plan meets the City's objectives for redevelopment. Due to the high cost of redevelopment on the parcels currently occupied by substandard buildings, the limited amount of commercial and for sale housing property for expansion adjacent to the existing project, the incompatible land uses at close proximity, and the cost of financing the proposed improvements, this project is feasible only through assistance, in part, from tax increment financing. The proposed development will clean up blighted sites and remove substandard buildings in the City=s downtown are and continue with the redevelopment of the area. The proposed development will also provide additional senior housing in the community and therefore allow single-family homes to be available for new residents. The developer was asked for and provided a letter and a proforma as justification that the developer would not have gone forward without tax increment assistance. (See attachment in Appendix G of the TIF Plan.) The increased market value of the site that could reosonably be expected to occur without the use of tax increment financing would be less than the increase in 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 TIF District permitted by the Plan: This finding is justified on the grounds that the cost of site and public improvements and utilities add to the total redevelopment cost. Historically, site and public improvements costs in this area have made redevelopment infeasible without tax increment assistance. At the current time, the site has an estimated $20 million in land acquisition, demolition and relocation costs. In addition, the site requires from $3.5 million to $5 million for on-site structured parking to accommodate the buyers of the for sale'housing. These two factors result in a cost per unit for land that greatly exceeds market conditions. The tax increment is needed to reduce these costs and make them marketable. Therefore, the City reasonably detennines that no other redevelopment of similar scope is anticipated on this site without substantially similar assistance being provided to the development. A comparative analysis of estimated market values both with and without establishment of the District and the use of tax increments has been perfonned as described above. If all development which is proposed to be assisted with tax increment were to occur in the District, the total increase in market value would be up to $53,561,555. The present value oft;IX increments from the District is estimated to be $18,803,224. It is the Council's finding that no development with a market value of greater than $34,758,33 I would occur without tax increment assistance in this district within 25 years. This finding is based upon evidence from general past experience with the high cost of acquisition and public improvements in the general area of the District. (See Cashflow in Appendix D of the TIF Plan.) 3. Finding that the Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission reviewed the TIF Plan and found that the TIF Plan conforms to the general development plan of the City. 4. Finding that the Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Redevelopment Project No.1 by private enterprise. The project to be assisted by the TIF District will result in increased employment in the City and the State of Minnesota, the redevelopment of substandard properties, increased tax base of the State and add a high quality development to the City. Through the implementation of the TIF Plan, the HRA and City will also increase the availability of safe and decent life-cycle housing in the City. CITY OF HOPKINS COUNTY OF HENNEPIN RESOLUTION RZ05-16 RESOLUTION OF THE HOPKINS PLANNING COMMISSION FINDING THAT THE MODIFICATION TO THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO.1 AND THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT 1-3 CONFORM TO THE GENERAL PLANS FOR THE DEVELOPMENT AND REDEVELOPMENT OF THE CITY. WHEREAS, the City Council for the City of Hopkins, Minnesota (the "City"), has proposed to adopt a modification to the Redevelopment Plan for Redevelopment Project No.1 and Tax Increment Financing Plan for Tax Increment Financing District 1-3 (collectively, the "Plan") and has submitted the Plan to the Hopkins Planning Commission (the "Commission"), pursuant to Minnesota Statutes, Section 469.175, Subdivision 3; and WHEREAS, the Commission has reviewed the Plan to determine its conformity with the general plans for the development and redevelopment of the City as described in the Comprehensive Plan for the City. NOW, THEREFORE, BE IT RESOLVED by the Commission that the Plan conforms with the general plans for the development and redevelopment of the City as a whole. Adopted this 31st day of May 2005. ATTEST: ~~d~.~ Mary H:her, ~Ir I . . . . . ' . ~ of June 1, 2005 . DraftforCity (:ouncil Review . "'.". - ',"'^ , MODIFICATION TO THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO.1 and the TAX INCREMENT FINANCING PLAN for the establishment of TAX INCREMENT FINANCING DISTRICT NO. 1-3 (a redevelopment district) within REDEVELOPMENT PROJECT NO.1 HOPKINS HOUSING AND REDEVELOPMENT AUTHORITY CITY OF HOPKINS HENNEPIN COUNTY STATE OF MINNESOTA Public Hearing: June 21, 2005 Adopted: EHLERS Prepared by: EHLERS & ASSOCIATES, INC. 3060 Centre Pointe Drive, Roseville, Minnesota 56113-1105 651-697-8500 fax: 651-697-8555 www.ehlers-inc.com & ASSOCIATES INC TABLE OF CONTENTS (for reference purposes only) SECTION 1- MODIFICATION TO THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO.1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1-1 Foreword ............................................................. 1-1 A. Plan History .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1-1 B. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1-1 C. Statement of Need and Public Purpose. . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . .. 1-1 D. Statutory Authority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1-2 E. Project Boundaries ................................................. 1-3 F. Property Acquisition. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1-3 G. Redevelopment Project Financing..... .. .......... .............. .. ..... 1-4 SECTION 11- TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 1-3 ........................ 2-1 Subsection 2-1. Foreword...... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 2-1 Subsection 2-2. Statutory Authority. . '.. .. . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . .. 2-1 Subsection 2-3. Statement of Objectives ................................... 2-1 Subsection 2-4. Redevelopment Plan Overview. . .. ... . . . . . . . . . .. . .. . . . . . . ... 2-1 Subsection 2-5. Description of Property in the District and Property To Be Acquired . 2-2 Subsection 2-6. Classification of the District. . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 2-2 Subsection 2-7. Duration of the District................... .......... ~....... 2-4 Subsection 2-8. Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity Value/lncrement and Notification of Prior Planned Improvements. . . . . . . . . . . . . . .. 2-4 Subsection 2-9. Sources of Revenue/Bonded Indebtedness .................... 2-5 Subsection 2-10. Uses of Funds.. ..... .. . .. . . . . .... . . . . . . . .. .. .... . . . . . .... 2-6 Subsection 2-11. Fiscal Disparities Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 2-6 Subsection 2-12. Business Subsidies. . .. . . . . . . . . . ... .. . . . . . . . .. . . . . . . . . .. .. 2-7 Subsection 2-13. County Road Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 2-8 Subsection 2-14. Estimated Impact on Other Taxing Jurisdictions. . . . . . . . . . . . . . . .. 2-8 Subsection 2-15. Supporting Documentation. . . . . ... .., . . . . . . . . . .. . . . . . . . . . . .. 2-9 Subsection 2-16. Definition of Tax Increment Revenues...... . .......... .. ..... 2-9 Subsection 2-17. Modifications to the District.. .. . . . ... .. . . . . . . . ... . . . . . . . . . .. 2-9 Subsection 2-18. Administrative Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 2-10 Subsection 2-19. Limitation of Increment..... ........... .. . .......... .. .... 2-11 Subsection 2-20. Use of Tax Increment. .. . . . . . . ..... . . . . . . . . . .. . . .. . . . . . .. 2-12 Subsection 2-21. Excess Increments ...................................... 2-12 Subsection 2-22. Requirements for Agreements with the Developer. .. .. . . . . . . . .. 2-13 Subsection 2-23. Assessment Agreements ................................. 2-13 Subsection 2-24. Administration of the District.... ........ .. .... ...... . ...... 2-13 Subsection 2-25. Annual Disclosure Requirements. . ... .. . . . . .. . .. . . .. . . . . ... 2-13 Subsection 2-26. Reasonable Expectations. . . . . . . . ... . . . . . . . . .. . . ... . . . . . .. 2-13 Subsection 2-27. Other Limitations on the Use of Tax Increment. . . . . . . . . . . . . . . .. 2-14 Subsection 2-28. Summary.............................................. 2-14 APPENDIX A PROJECT DESCRIPTION ... ........... ................ ........ ..... ..... A-1 APPENDIX B MAP(S) OF REDEVELOPMENT PROJECT NO.1 AND THE DISTRICT. . . . . . . . . . .. B-1 APPENDIX C DESCRIPTION OF PROPERTY TO BE INCLUDED IN THE DISTRICT. . . . . . . . . . . .. C-1 APPENDIX D ESTIMATED CASH FLOW FOR THE DISTRICT .............................. D-1 APPENDIX E MINNESOTA BUSINESS ASSISTANCE FORM ............................... E-1 APPENDIX F REDEVELOPMENT QUALIFICATIONS FOR THE DiSTRiCT........ ............ F~1 APPENDIX G BUT/FOR QUALIFICATIONS... . .. . . . . .. .... . . . . . . . .. ....... . . .'. . .. . .. . . .. G-1 SECTION I. MODIFICA TION TO THE REDEVELOPMENT PLAN FOR REDEVELOPMENTPROJECT NO.1 Foreword The following text represents a Modification to the Redevelopment Plan for Redevelopment Project No.1. This modification represents a continuation of the goals and objectives set forth in the Redevelopment Plan for Redevelopment Project No.1. Generally, the substantive changes include the establishment of Tax Increment Financing District No. 1-3. For further information, a review of the Redevelopment Plan for Redevelopment Project No. 1 is recommended. It is available from the City Clerk at the City of Hopkins. Other relevant information is contained in the Tax Increment Financing Plans for the Tax Increment Financing Districts located within Redevelopment Project No.1. In addition the Redevelopment Plan for Redevelopment Project No.1 is hereby amended and supplemented as follows: A. Plan History Redevelopment ProjectNo. I was originally created in 1971 as a federal urban renewal area. Redevelopment Project No. 1 was subsequently modified numerous times. In 1989 the Housing and Redevelopment Authority In and For the City of Hopkins (the "HRA") and the City of Hopkins (the "City") caused to be prepared a Reorganization and Modification of Redevelopment Projects and Tax Increment Financing Districts dated November 7, 1989, which was approved by the City and the HRA (the" 1989 Modification"). The 1989 Modification contains a statement of the history of Redevelopment Project No. 1 and the Redevelopment Plan. The Redevelopment Plan for Redevelopment Project No. 1 was modified several times after the 1989 Modification in connection with the creation or modification of tax increment financing districts located within Redevelopment Project No.1. B. Definitions Unless specifically detlled in this Modification, all capitalized terms shall have the meaning given to such terms in the 1989 Modification. C. Statement of Need and Public Purpose A. The HRA reaffirms the statements of need and public purpose contained in the Redevelopment Plan for Redevelopment Project No.1, and all modifications thereto. The HRA further seeks to achieve the following goals and objectives: 1. Acquire substandard or blighted areas and other real property for the .purpose of removing, preventing or reducing blight, blighting factors or the causes of blight; 2. Clear any areas acquired and install, construct or reconstruct streets, utilities and site improvements essential to the preparation of the sites for redevelopment; 3. Provide a sufficient supply of adequate, safe and sanitary dwellings; 4. Protect the health, safety, morals and welfare of the citizens of the City; Hopkins HRA Modification to the Redevelopment Plan for Redevelopment Project No.1 1-1 5. Encourage related development and redevelopment in order to protect and improve the tax base and general economic vitality of the City, and 6. 'Assure that the long term housing needs of the City are met. B. The HRA hereby reaffIrms all findings contained in the Redevelopment Plan for Redevelopment Project No. I, all amendments thereto, and all resolutions of the liRA or City approving the same and specifically finds for Redevelopment Project No. I that: I. The land within the area of Redevelopment Project No. I would not be available for redevelopment without the financial aid to be sought under this Redevelopment Plan and corresponding documents, including the Tax Increment Plan for Tax Increment Financing District No. 1-3; 2. The Redevelopment Plan for Redevelopment Project No. I will afford maximum opportunity, consistent with the needs of the City as a whole, for the development of Redevelopment Project No. I by private enterprise; and . 3. The Redevelopment Plan for Redevelopment Project No. I conforms to the general plan for the development of the City as a whole. C. The HRA reaffmns its finding that Redevelopment Project No. I is a "redevelopment project" within the meaning of Minnesota Statutes, Section 469.002 subd. 14, of the HRA Act. The factual basis for the above finding includes: I. The HRA relies on the various studies, surveys and planning documents prepared in connection with the creation of Redevelopment Project No. I to the extent that subsequent development activities have not cured the conditions that allowed designation of Redevelopment Project No.1 as a "redevelopment project." 2. In May of 2005 LHB, Inc. ("LHB") conducted a study of building conditions in the portion of the area of Redevelopment Project No.1 proposed to be included in Tax Increment Financing District No. 1-3.. That study determined that a substantial percentage of the buildings in that portion of the area of Redevelopment Project No. 1 are structurally substandard as defined in Minnesota Statutes, Section469.174, subd. 10. Such findings and other evidence on file with the HRA support the conclusion that said portion of the area of Redevelopment Project No. I is a ''blighted area" within the meaning of Section 469.002, subdivision 11 of the HRA Act. Data from the LHB study are on file with the Authority. These study results will also be used when considering the establishment of Tax Increment Financing District No. 1-3. D. Statutory Authority The HRA is authorized under the the HRA Act to undertake and administer Redevelopment Project No. I, and to finance Public Redevelopment Costs through issuance of bonds secured by Redevelopment Project No. I revenues. Hopkins liRA Modification to the Redevelopment Plan for Redevelopment Project No.1 1-2 E. Project Boundaries The boundaries of Redevelopment Project No. 1 are described in the existing Redevelopment Plan for Redevelopment Project No. I and modifications thereto and are not being changed by this Modification. F. Property Acquisition The Authority may acquire any property within the area of Redevelopment Project No.1, or interests therein, as the Authority may deem necessary or desirable to carry out the objectives of the Redevelopment Plan for Redevelopment Project No.1. Acquisition may be accomplished by negotiation or by the exercise of the Authority's powers of eminent domain. The Authority currently anticipates, and frods a need to acquire, the parcels including but not limited to the following in order to carry out this Redevelopment Plan: :""'~"io.i';."''''''''''''~~ . "~~~l)'.lllN,W~e. ,. 24 117 22 42 0005 24 117 22 42 0006 24 1172242 0008 24 11722 42 0009 24 117 22 42 0012 24 117 22 42 0013 2411722420014 2411722420015 2411722420016 2411722420017 2411722420018 24 117 22 42 0019 24 177 22 42 0029 24 117 22 42 0030 2411722420031 24 11722 42 0032 2411722420033 2411722420048 2411722420049 24 117 22 42 0050 24 117 22 42 0056 24 117 22 42 0057 24 11722 42 0166 24 117 22 42 0167 2411722420169 ,,' ,-_""'...-. -"-,,' a"'H~"_"""1f"""'" ..: ~fi",Ii\\';~~ ra'sc;.',,,,.:.:li,",,,,,' 33 - 6th Ave. N. Parkin Lot 517 Mainstreet 501 Mamstreet 44 5th Ave. N. 30 5th Ave.N. 36 - 5th Ave. N. 24 - 5'b Ave. N. 10 - 5th Ave. N. 15 6th Ave. N. 13 6th Ave.N. Parkin Lot 66th AveN 611 Mainstreet Unass! ed Unass! oed 621 Mainstreet Unass' oed 701 Mainstreet Unass' oed 19E! hthAve.N. 21 8th Ave. N. 525 Mainstreet Unass! oed Unass' oed Hopkins lIRA Modification to the Redevelopment Plan for Redevelopment Project No.1 1-3 G. Redevelopment Project Financing The HRA may establish one or more TIP Districts in Redevelopment Project No. 1 to finance Public Redevelopment Costs. The HRA may also use any other revenues available to the HRA to pay such costs, including without limitation grant funds, property tax abatements through the City under Minnesota Statutes, Sections 469.1812 to 469.1815, and proceeds ofa special tax, if any, levied under Section 469.033 of the HRA Act. Hopkins HRA Modification to the Redevelopment Plan for Redevelopment Project No.1 1-4 SECTION 11- TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 1.3 Subsection 2-1. Foreword The Hopkins Housing andRedevelopmentAuthority (the "lIRA"), the City of Hopkins (the "City"), staff and consultants have prepared the foUowing information to expedite the establishment of Tax Increment Financing District No. 1-3 (the "District"), a redevelopment tax increment financing district, located in Redevelopment Project No_ 1. Subsection 2-2. Statutory Authority Within the City, there exists areas where public involvement is necessary to cause development or redevelopment to occur. To this end, the HRA and City have certain statutory powers pursuant to Minnesota Statutes ("M.S.'?, Sections 469.001 to 469.047, inclusive, as amended, and MS., Sections 469.174 to 469.1799, inclusive, as amended (the "Tax Increment Financing Act" or "TlF Act"), to assist in financing public costs related to this project. This section contains the Tax Increment Financing Plan (the "TlF Plan") for Tax Increment Financing District No. 1-3. Other. relevant information is contained in the Modification to the Redevelopment Plan for Redevelopment Project No.1. Subsection 2-3. Statement of Objectives The District currently consists of25 parcels ofland and adjacent and internal rights-of-way. The District is being created to facilitate the redevelopment of a portion of the downtown area and construct a mixed-use commercial and housing development in the City of Hopkins. Please see Appendix A for further project information. Contracts for this have not been entered into at the time of preparation of this TlF Plan, but Phase I of the development is likely to .begin in the FaU of2005. This TIF Plan is expected to achieve many of the objectives outlined in the Redevelopment Plan for Redevelopment Project No. I. The activities contemplated in the Modification to the Redevelopment Plan and the TIF Plan do not preclude the undertaking of other qualified development or redevelopment activities. These activities are anticipated to occur over the life of Redevelopment Project No. I and the District. Subsection 2-4. Redevelopment Plan Overview 1. Property to be Acquired - Selected property located within the District may be acquired by the lIRA or City and is further described in this TlF Plan. 2. Relocation - Relocation services, to the extent required by law, are available pursuant to MS., Chapter 117 and other relevant state and federal laws. 3. Upon approval ofa developer's plan relating to the project and completion oflhe necessary legal requirements, the lIRA or City may seU to a developer selected properties that it may acquire within the District or may lease land or facilities to a developer. 4. The lIRA or City may perform or provide for some or aU necessary acquisition, construction, relocation, demolition, and required utilities and public street work within the District. Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3. 2-1 Subsection 2-5. Description of Property in the District and Property To Be Acquired The District encompasses all property and adjacent rights-of-way and abutting roadways identified by the parcels listed in Appendix C. See the map in Appendix B for further information on the location of the District. The HRA or City may acquire any parcel within the District including interior and adjacent street rights of way. Any properties identified for acquisition will be acquired by the HRA or City only in order to accomplish one or more of the following: storm sewer improvements; provide land for needed public streets, utilities and facilities; carry out land acquisition, site improvements, clearance and/or development to accomplish the uses and objectives set forth in this plan. The HRA or City may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of this TIF Plan. Such acquisitions will be undertaken only when there is assurance offunding to finance the acquisition and related costs. Subsection 2-6. Classification of the District The HRA and City, in determining the need to create a tax increment financing district in accordance with M.S., Sections 469.174 to 469.1799, as amended, inclusive, frod that the District, to be established, is a redevelopment district pursuant to Us., Section 469.174, Subd. lO(a}(I) as defined below: (a) "Redevelopment district" means a type of tax increment financing district consisting of a project, or portions of a project, within which the authority finds by resolution ihat one or more of the following conditions, reasonably distributed throughout the district, exists: (1) parcels consisting of 70 percent of the area in the district are occupied by buildings, streets, utilities, paved or gravel parling lots or other similar structures and more than 50 percent of the buildings, not including outbuildings, are structurally substandard to a degree requin'ng subStantial renovation or clearance; (2) The property consists of vacant, unused, underused, inappropriately used, or infi'equently used rail yards, rail storage facilities or excessive or vacated railroad rights-of-way; (3) tankfacilities, or property whose immediately previous use was for tankfacilities, as d'lfined in Section 115 C, Subd. 15, if the tank facility: (i) have or had a capacity of more than one million gallons; (ii) are located adjacent to rail facilities; or (iii) have been removed, or are unused, underused, inappropliately used or infrequently used; or (4) a qualifYing disaster area, as defined in Subd. lOb. (b) For purposes of this subdivision, "structurally substandard" shall mean containing defects in structural elements or a combination of deficiencies in essential utilities andfacilities, light and ventilation,fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance. Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2-2 (c) A building is not structurally substandard ifit is in compliance with the building code applicable to new buildings or could be modified to satisfy the building code at a cost of less than 15 percent of the cost of constructing a new strncture of the same square footage and type on the site. The municipality may find that a building is not disqualified as structurally substandard under the preceding sentence on the basis of reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or strnctural repairs or other similar reliable evidence. The municipality may not make such a determination without an interior inspection of the property, but need not have an independent, expert appraisal prepared of the cost of repair and rehabilitation of the building. An interior inspection of the property is not required, if the municipality finds that (1) the municipality or authority is unable to gain access to the property afier using its best efforts to obtain permission from the pm'ty that owns or controls the property; and (2) the evidence otherwise supports a reasonable conclUsion that the building is strncturallY substandard. (d) A parcel is deemed to be occupied by a strncturally substandard building for purposes of the finding under paragraph (a) if all of the following conditions are met: (1) the parcel was occupied by a substandard building within three years of the filing of the request for certification of the parcel as part of the district with the county auditor; (2) the substandard building was demolished or removed by the authority or the demolition or removal was financed by the authority or was done by a developer under a development agreement with the authority; (3) the authority found by resolution before the demolition or removal that the parcel was occupied by a strncturally substandard building and that after demolition and clearance the authority intended to include the parcel within a district; and (4) upon filing the request for certification of the tax capacity of the parcel as part of a district, the authority notifies the county auditor that the original tax capacity of the parcel must be adjusted as provided by J 469.177, subdivision 1, paragraph (j). (e) For pwposes of this subdivision, a parcelis not occupied by buildings, streets, utilities, paved or gravel parking lots or other similar strnctures unless 15 percent of the area of the parcel contains buildings, streets, utilities, paved or gravel parking lots or other similar structures. (j) For districts consisting of two or more noncontiguous areas, each area must qualify as a redevelopment district under paragraph (a) to be included in the district, and the entire area of the district must satisfY paragraph (a). In meeting the statutory criteria the lIRA and City rely on the following facts and findings: .. The District is a redevelopment district consisting of 25 parcell s). .. An inventory shows .that parcels consisting of more than 70 percent of the area in the District are occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures. An inspection of the buildings located within th,e District finds that more than 50 percent of the buildings are structurally substandard as defmed in the TIP Act. (See Appendix F). . .' Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. 1 ~3 2-3 Pursuant to MS., Sections 469.176 Subd. 7, the District does not contain any parcel or part ofa parcel that qualified under the provisions of M.S., Sections 273.111 or 273.112 or Chapter 47 3H for taxes payable in any of the five calendar years before the filing of the request for certification of the District. Subsection 2.7. Duration of the District Pursuant to M.S., Section 469.175, Subd. 1, and Section 469.176, Subd. 1, the duration of the District must be indicated within the TIF Plan. Pursuant to MS., Section 469.176, Subd. 1b, the duration of the District will be 25 years afterreceipt of the first increment by the HRA or City (a total of 26 years of tax increment). The date of receipt by the City of the first tax increment is expected to be 2007. Thus, it is estimated that the District, including any modifications of the TIF Plan for subsequent phases or other changes, would terminate after 2032, or when the TIF Plan is satisfied, whichever occurs first. If increment is received in 2006, the term of the District will be 2031. The HRA or City reserves the right to decertify the District prior to the legally required date. Subsection 2.8. Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity Valuellncrement and Notification of Prior Planned Improvements Pursuantto M.S., Section 469.174, Subd. 7 andMS., Section 469.177, Subd. 1, the Original NetTax Capacity (ONTe) as certified for the District will be based on the market values placed on the property by the assessor in 2004 for taxes payable 2005. Pursuant to MS., Section 469.177, Subds. 1 and 2, the County Auditor shall certify in each year (beginning in the payment year 2007) the amount by which the original value has increased or decreased as a result of: 1. Change in tax exempt status of property; 2. Reduction or enlargement of the geographic boundaries of the district; 3. Change due to adjustments, negotiated or court-ordered abatements; 4. Change in the use of the property and classification; 5. Change in state law governing class rates; or 6. Change in previously issued building permits. In any year in which the current Net Tax Capacity (NTC) value of the District declines below the ONTC, no value will be captured and no tax increment will be payable to the HRA or City. The original local tax rate for the District will be the local tax rate for taxes payable 2005, assuming the request for certification is made before June 30, 2005. The ONTC and the Original Local Tax Rate for the District appear in the table on the following page. Pursuant to M.S., Section 469.174 Subd. 4 and M.S., Section 469.177, Subd. 1, 2, and 4, the estimated Captured Net Tax Capacity (CTe) of the District, within Redevelopment Project No. I, upon completion of the project, will annually approximate tax increment revenues as shown in the table on the following page. The HRA and City request 100 percent of the available increase in tax capacity for repayment of its obligations and current expenditures, beginning in the tax year payable 2007. The Project Tax Capacity (FTC) listed is an estimate of values when the project is completed. Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2-4 Project Estimated Tax Capacity upon Completion (pTC)* Original Estimated Net Tax Capacity (ONTe) Estimated Captured Tax Capacity (CTC) Original Local Tax Rate Estimated Annual Tax Increment (CTC x Local Tax Rate) Percent Retained by tbe BRA $1,097,255 $99,120 $998,135 1.20839 Pay 2005 $1,206,136 100% 'The tax capacity is the estimated tax capacity for 2009. The cashflow incorporates the Phasing for each project and an inflation rate, which will result in higher cre in future years. Pursuant toMS., Section 469.177, Subd. 4, the BRA shall, after a due and diligent search, accompany its request for certification to the County Auditor or its notice of the District enlargement pursuant to MS., Section 469.175, Subd. 4, with a listing of all properties within the District or area of enlargement for which building permits have been issued during the eighteen (18) months immediately preceding approval of the TIP Plan by the municipalitypursuantto MS., Section 469.175, Subd. 3. The County Auditor shall increase the original net tax capacity of the District by the net tax capacity of improvements for which a building permit was issued. The City of Hopkins bas reviewed the area to be included in the District and found that no building permits have been issued during the 18 months immediately preceding approval ofthe TIF Plan by the City. Subsection 2-9. Sources of Revenue/Bonded Indebtedness Public improvement costs, acquisition, relocation, utilities, parking facilities, streets and sidewalks, and site preparation costs and other costs outlined in the Uses of Funds will be fmanced primarily through the annual collection of tax increments. The BRA or City reserves the right to use other sources of revenue legally ap- plicable to the BRA or City and the TIP Plan, including, but not limited to, special assessments, general property taxes, state aid for road maintenance and construction, proceeds from the sale ofland, other contribu- tions from the developer and investment income, to pay for the estimated public costs. The BRA or City reserves the right to incur bonded indebtedness or other indebtedness as a result of the TIF Plan. As presently proposed, the project will be financed by a combination of a bond issue, a pay-as-you-go note, and an interfund loan or transfer. Additional indebtedness may be required to finance other authorized activities. The total principal amount of bonded indebtedness, including a general obligation (GO) TIP bond, or other indebtedness related to the use of tax increment fmancing will not exceed $48,400,000 without a modification to the TIF Plan pursuant to applicable statutory requirements. It is estimated that $48,400,000 in bonded indebtedness will be financed with tax increment revenues. This provision does not obligate the BRA or City to incur debt. The BRA or City will issue bonds or incur other debt only upon the determination that such action is in the best interest of the BRA or City, as the case may be. The BRA or City may also finance the activities to be undertaken pursuant to the TIP Plan through loans from funds of the lIRA or City or to reimburse the developer on a "pay-as-you-go" basis for eligible costs paid for by a developer. Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. }.3 2-5 The estimated sources of funds for the District are contained in the table below. SOURCES OF FUNDS TOTAL $54,400,000 $54,400,000 Tax Increment PROJECT REVENUES Subsection 2-10. Uses of Funds Currently under consideration for the District is a proposal to facilitate the redevelopment of a portion of the downtown area and construct a mixed-use commercial and housing development in the City of Hopkins. The HRA and City have determined that it will be necessary to provide assistance to the project for certain costs. The HRA has studied the feasibility of the development or redevelopment of property in and around the District. 1:0 facilitate the establishment and development or redevelopment of the District, this TIF Plan authorizes the use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs and uses of funds associated with the District is outlined in the following table. PROJECT COSTS TOTAL TOTAL $20,000,000 $5,000,000 $5,000,000 $18,960,000 $5,440,000 $54,400,000 USES OF FUNDS Land/Building Acquisition Site ImprovementsfPreparation Parking Facilities Interest Administrative Costs (up to 10%) It is estimated that the cost of improvements, including administrative expenses which will be paid or financed with tax increments, will equal $54,400,000 as is presented in the budget above. Estimated costs associated with the District are subject to change among categories without a modification to this TIP Plan. The cost of all activities to be considered for tax increment financing will not exceed, without formal modification, the budget above pursuant to the applicable statutory requirements. Pursuant to M.S., Section 469.1763, Subd. 2, no more than 25 percent of the tax increment paid by property within the District will be spent on activities related to development or redevelopment outside of the District but within the boundaries of Redevelopment Project No. 1, (including administrative costs, which are considered to be spent outside of the District) subject to the limitations as described in this TIF Plan. Subsection 2-11. Fiscal Disparities Election Pursuant to M.S., Section 469.177, Subd. 3, the HRA or City may elect one of two methods to calculate fiscal disparities. lfthe calculations pursuant to MS., Section 469.177, Subd. 3, clause b, (within the District) are followed, the following method of computation shall apply: (1) The original net tax capacity shall be determined before the application of the fiscal dispality provisions of Chapter 276A or 473F. The current net tax capacity shall exclude any fiscal disparity commercial-industrial net tax capacity increase between the original year and the current year multiplied by the fiscal disparity ratio determined pursuant to M.S., Section Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2-6 276A.06, subdivision 7 or M.S., Section 473F.08, subdivision 6. Where the original net tax capacity is equal to or greater than the current net tax capacity, there is no captured tax capacity and no tax incremen( determination. Whe,'e the original tax capacity is less than the current tax capacity, the difference between the original net tax capacity and the cun'ent net tax capacity is the captured net tax capacity. This amount less any portion thereofwhich the authority has designated, in its tax increment financing plan, to share with the local taxing districts is the retained captured net tax capacity of the authority. (2) The county auditor shall exclude the retained captured net tax capacity of the authority from the net tax capacity of the local taxing districts in determining local taxing district 'tax rates. The local tax rates so determined are to be extended against the retained captured net tax capacity of the authority as well as the net tax capacity of the local taxing districts. The tax generated by the extension of the less of (A) the local taxing district tax rates or (B) the original local tax rate to the retained captured net tax capacity of the authority is the tax increment of the authority. The BRA will choose to calculate fiscal disparities by M.S., Section 469.177, Subd. 3, clause b. According to M.S., Section 469.177, Subd. 3: (c) The method of computation of tax increment applied to a district pursuant to paragraph (a) or (b) shall remain the same for the duration of the district, except that the governing body may elect to change its electionji'om the method of computation in paragraph (a) to the method in paragraph (b). Subsection 2-12. Business Subsidies Pursuant to M.S. Sections 1161. 993, Subd. 3, the following forms of financial assistance are not considered a business subsidy: (1) A business subsidy ofless than $25,000; (2) Assistance that is generally available to all businesses or to a general class of similar businesses, such as a line of business, size, location, or similar general criteria; (3) Public improvements to buildings orlands owned by the state orlocal government that serve a public purpose and do not principally benefit a single business or defined group of businesses at the time the improvements are made; (4) Redevelopment property polluted by contaminants as defmed in M.S., Section 1161.552, Subd. 3; (5) Assistance provided for the sole purpose of renovating old or decaying building stock or bringing it up to code and assistance provided for designated historic preservation districts, provided that the assistance is equal to or less than 50% of the total cost; (6) Assistance to provide job readiness and training services if the sole purpose of the assistance is to provide those services; (7) Assistance for housing; (8) Assistance for pollution control or abatement, including assistance for a tax increment fmancing hazardous substance subdistrict as defined under M.S., Section 469.174, Subd. 23; (9) Assistance for energy conservation; (10) Tax reductions resulting from confonnity with federal tax law; (II ) Workers' compensation and unemployment compensation; (12) Benefits derived from regulation; (13) Indirect benefits derived from assistance to educational institutions; Hopkins lIRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2-7 (14) Funds from bonds allocated under chapter 474A, bonds issued to refund outstanding bonds, and bonds issued for the benefit of an organization described in section 501 (c) (3) of the Internal Revenue Code of1986, as amended through December 31,1999; Assistance for a collaboration between a Minnesota higher education institution and a business;' Assistance for a tax increment fmancing soils condition district as defmed under M.S., Section 469.174, Subd. 19; . Redevelopment when the recipient's investment in the purchase of the site and in site preparation is 70 percent or more of the assessor's current year's estimated market value; General changes in tax increment financing law and other general tax law changes of a principally technical nature. ' Federal assistance until the assistance has been repaid to, and reinvested by, the state or local government agency; Funds from dock and wharf bonds issued by a seaway port authority; Business loans and loan guarantees of$75,000 or less; and Federal loan funds provided through the United States Department of Commerce, Economic Development Administration. (15) (16) (17) (18) (19) (20) (21) (22) The HRA will comply with M.S., Section 116J.993 to 116J.995 to the extent the tax increment assistance under this TIF Plan does not fall under any of the above exemptions. Subsection 2-13. County Road Costs Pursuantto MS., Section 469.175, Subd. ] a, the county board may require the HRA or City to pay for all or part of the cost of county road improvements if the proposed development to be assisted by tax increment will, in the judgement of the county, substantially increase the use of county roads requiring construction of road improvements or other road costs and if the road improvements are not scheduled within the next five years under a capital improvement plan or within five years under another county plan. If the county elects to use increments to improve county roads, it must notify the HRA or City within forty- five days of receipt of this TIF Plan. The HRA and City are aware that the county could claim that tax increment should be used for county roads, even after the public hearing. Subsection 2-14. Estimated Impact on Other Taxing Jurisdictions The estimated impact on other taxing jurisdictions assumes that the redevelopment contemplated by the TIF Plan would occur without the creation of the District. However, the HRA or City has determined that such development or redevelopment would not occur "but for" tax increment financing and that, therefore, the fiscal impact on other taxing jurisdictions is $0. The estimated fiscal impact of the District would be as follows if the "but for" test was not met: IMPACT ON TAX BASE . Hennepin County City of Hopkins ISD No. 270 2004/2005 Total Net Tax CaDacitv 1,092,690,078 14,654,509 80,103,617 Estimated Captured Tax Capacity (CTC) UDon ComDletion 998,135 998,135 998,135 Percent of CTC to Entity Total 0.09130/. 6.8111 % 1.2461 % Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2-8 IMPACT ON TAX RATES 2004/2005 Percent Potential Extension Rates of Total CTC Taxes Hennepin County 0.441720 36.55% 998,135 440,896 City of Hopkins 0.489440 40.50% 998,135 488,527 ISD No. 270 0.191760 15.87% 998,135 191,402 Other 0.085470 7.07% 998.135 85.311 Total 1.208390 100.00% 1,206,136 The estimates listed above display the captured tax capacity when all construction is completed. The tax rate used for calculations is the actual2004/Pay 2005 rate. The total net capacity for the entities listed above are based on actual Pay 2005 figUres." .' Subsection 2-15. Supporting Documentation Pursuant to M.S. Section 469.175 Subd 1, clause 7 the TIF Plan must contain identification and description of studies and analyses used to make the determination set forth in M.S. Section 469.175 Subd 3, clause (2) and the findings are required in the resolution approving the TIP district. Following is a list of reports and studies on file at the City that support the Authority's findings: .. TIF application Redevelopment and Blight Analysis by LHB dated May 2005 Block 64 Redevelopment Relocation Plan by Wilson Development Services dated January, 2005 Market Analysis Hopkins Main Street Residential Campus by GPS Financial Group dated March 2005 .. .. .. Subsection 2-16. Definition of Tax Increment Revenues Pursuant to M.S., Section 469.174, Subd. 25, tax increment revenues derived from a tax increment fmancing district include all of the following potential revenu.e sources: 1. Taxes paid by the captured net tax capacity, but excluding any excess taxes, as computed under M.S., Section 469.177; 2. The proceeds from the sale or lease of property, tangible or intangible, purchased by the Authority with tax increments; 3. Principal and interest received on loans or other advances made by the Authority with tax increments; and 4. Interest or other investment earnings on or from tax increments. Subsection 2-17. Modifications to the District In accordance with M.S., Section 469.175, Subd. 4, any: 1. Reduction or enlargement of the geographic area of Redevelopment Project No. I or the District, if the reduction does not meet the requirements of M.S., Section 469.175, Subd. 4(e); Increase in amount of bonded indebtedness to be.incurred; . 2. Hopkins lIRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2.9 3. A determination to capitalize interest on debt if that determination was not a part of the original TIP Plan, or to increase or decrease the amount of interest on the debt to be capita1ized; 4. Increase in the portion of the captured net tax capacity to be retained by the BRA or City; 5. Increase in the estimate of the cost of the project, including administrative expenses, that will be paid or nnanced with tax increment from the District; or 6. Designation of additional property to be acquired by the HRA or City, shall be approved upon the notice and after the discussion, public hearing and findings required for approval of the original TIF Plan. Pursuant to M.S. Section 469.175 Subd. 4(f), the geographic area ofthe District may be reduced, but shall not be enlarged after five years following the date of certification of the original net tax capacity by the county auditor. If a redevelopment district is enlarged, the reasons and supporting facts for the determination that the addition to the district meets the criteria of M.S., Section 469.174, Subd. 10, paragraph (a), clauses (I) to (5), must be documented in writing and retained. The requirements of this paragraph do not apply if (1) the only modification is elimination ofparcel(s) from Redevelopment Project No. I or the District and (2) (A) the current net tax capacity of the parcel(s) eliminated from the District equals or exceeds the net tax capacity of those parcel(s) in the District's original net tax capacity or (B) the HRA agrees that, notwithstandingM.S., Section 469.177, Subd. 1, the original net tax capacity will be reduced by no more than the current net tax capacity of the parcel( s) eliminated frOJ;ll the District. The HRA or City must notify the County Auditor of any modification that reduces or enlarges the geographic area of Redevelopment Project No.1 or the Disirict. Modifications to the District in the form of a budget modification or an expansion of the boundaries will be recorded in the TIF Plan. Subsection 2-18. Administrative Expenses In accordance with M.S., Section 469.174, Subd. 14, administrative expenses means all expenditures of the HRA or City, other than: 1. Amounts paid for the purchase ofland; 2. Amounts paid to contractors or others providing materials and services, including architectura1 and engineering services, directly connected with the physical development of the real property in the project; 3. Relocation benefits paid to or services provided for persons residing or businesses located in the proj ect; or 4. Amounts used to pay principal or interest on, fund a reserve for, or sell at a discount bonds issued pursuant to M.S., Section 469.178; or 5. Amounts used to pay other financial obligations to the extent those obligations were used to finance costs described in clauses (I) to (3). For districts for which the request for certification were made before August I, 1979, or after June 30, 1982, administrative expenses also include amounts paid for services provided by bond counsel, fiscal consnltants, and planning or economic development consultants. Pursuant to M.S., Section 469.176, Subd. 3, tax increment may be used to pay any authorized and documented administrative expenses for the District up to but not to exceed 10 percent of the total estimated tax increment expenditures authorized by the TIP Plan or the total tax increments, as defined by M.s., Section 469.174, Subd. 25, clause (1), from the District, whichever is less. Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District ,No. 1-3 2-10 . Pursuant to MS., Section 469.176, Subd. 4h, tax increments may be used to pay for the County's actual administrative expenses incurred in connection with the District. The county may require payment of those expenses by February 15 of the year following the year the expenses were incurred. Pursuant to MS., Section 469. 177, Subd. 11, the County Treasurer shall deduct an amount (currently .36 percent) of any increment distributed to the BRA or City and the County Treasurer shall pay the amount deducted to the State Treasurer for deposit in the state general fund to be appropriated to the State Auditor for the cost of financial reporting of tax increment fmancing information and the cost of examining and auditing authorities' use of tax increment fmancing; This amount may be adjusted annually by the Commissioner of Revenue. Subsection 2.19. Limitation of Increment Pursuantto M.S., Section 469.176, Subd. 1 a, no tax increment shall be paid to the HRA or City for the District after three (3) years from the date of certification of the Original Net Tax Capacity value of the. taxable properly in the District by the County Auditor unless within the three (3) year period: (1) Bonds have been issued in aid of the project containing the District pursuant toMS., Section 469.178, or any other law, except revenue bonds issued pursuant to MS., Sections 469.152 to 469.165, or (2) The BRA or City has acquired properly within the District, or (3) The HRA or City has constructed or caused to be constructed public improvements within the District. The bonds must be issued, or the HRA or City must acquire properly or construct or cause public improvements to be constructed by approximately June, 2008 and report such actions to the County Auditor. The tax increment pledged to the payment of bonds and interest thereon may be discharged and the District may be terminated ifsufficient funds have been irrevocably deposited in the debt service fund or other escrow account held in trust for all outstanding bonds to provide for the payment of the bonds at maturity or redemption date. Pursuant to M.S., Section 469.176, Subd. 6: if, afterfour years from the date of certification of the original net tax capacity of the tax increment financing district pursuant to M.S., Section 469.177, no demolition, rehabilitation or renovation of property or other site preparation, including qualified improvement of a street adjacent to a parcel but not installation of utility service including sewer or water systems, has been commenced on a parcel located within a tax increment financing district by the authority or by the owner of the parcel in accordance with the tax increment financingplan, no additional tax increment may be taken from that parcel and the original net tax capacity of that parcel shall be excluded from the original net tax capacity of the tax increment financing district. If the authority or the owner of the parcel subsequently commences demolition, rehabilitation or renovation or other site preparation on that parcel including qualified improvement of a street adjacent to that parcel, in accordance with the tax increment financing plan, the authority shall certifY to the county auditor that the activity has commenced and the county auditor shall certifY the net tax capacity thereof as most recently certified by the commissioner of revenue and add it to the original net tax capacity of the tax increment financing district. The county auditor must enforce the provisions of this subdivision. The authority must submit to the county auditor evidence that the required activity has taken place for each parcel Hopkins liRA Tax Increment Financing Plan, for Tax Increment Financing District No. ]-3 2-11 in the district. The evidence for a parcel must be submitted by February 1 of the fifth year following theyear in which the parcel was certified as included in the district. ForpUlposes of this subdivision, qualified improvements of a street are limited to (1) construction or opening of a new street, (2) relocation of a street, and (3) substantial reconstruction or rebuilding of an existing street. The HRA or City or a property owner must improve parcels within the District by approximately June, 2009 and report such actions to the County Auditor. Subsection 2-20. Use of Tax Increment The HRA or City hereby determines that it will use 100 percent of the captured net tax capacity of taxable property located in the District for the following purposes: 1. To pay the principal of and interest on bonds issued to fmance a project; 2. _ To finance, or otherwise pay public redevelopment costs of Redevelopment Project No.1 pursuant to the M.S., Sections 469.001 to 469.047; 3. To pay for project costs as identified in the budget set forth in the TlF Plan; 4. To finance, or otherwise pay for other purposes as provided in M.S., Section 469.176, Subd. 4; 5. To pay principal and interest on any loans, advances or other payments made to or on behalf of the HRA or City or for the benefit of Redevelopment Project No.1 by a developer; 6. To finance or otherwise pay premiums and other costs for insurance or other security guaranteeing the payment when due of principal of and interest on bonds pursuant to the TIF Plan or pursuant to M.S., Chapter 462G. M.S., Sections 469.152 through 469.165, and/or M.S., Sections 469.178; and 7. To accumulate or maintain a reserve securing the payment when due of the principal and interest on the tax increment bonds or bonds issued pursuant to M.S., Chapter 462C, M.S., Sections 469.152 through 469.165, andlorM.S., Sections 469.178. These revenues shall not be used to circumvent any levy limitations applicable to the City nor for other purposes prohibited by M.S., Section 469.176, Subd. 4. Tax increments generated in the District will be paid by Hennepin County to the HRA for the Tax Increment Fund of said District. The HRA or City will pay to the develop~r( s) annually an amount not to exceed an amount as specified in a developer's agreement to reimburse the costs of land acquisition, public improvements, demolition and relocation, site preparation, and administration. Remaining increment funds will be used for HRA or City administration (up to 10 percent) and the costs of public improvement activities outside the District. Subsection 2-21. Excess Increments Excess increments, as defmed !nM.S., Section 469.176, Subd. 2, shall be used only to do one or more of the following: 1. Prepay any outstanding bonds; 2. Discharge the pledge of tax increment for any outstanding bonds; 3. Pay into an escrow account dedicated to the payment of any outstanding bonds; or 4. Return the excess to the County Auditor for redistribution to the respective taxing jurisdictions in proportion to their local tax rates. In addition, the HRA or City may, subject to the limitations set forth herein, choose to modify the TlF Plan in order to finance additional public costs in Redevelopment Project No.1 or the District. Hopkins liRA Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2-12 Subsection 2-22. Requirements for Agreements with the Developer The HRA or City will review any proposal for private development to determine its conformance with the Redevelopment Plan and with applicable municipal ordinances and codes. To facilitate this effort, the following documents may be requested for review and approval: site plan, construction, mechanical, and electrical system drawings, landscaping plan, grading and storm drainage plan, signage system plan, and any other drawings or narrative deemed necessary by the HRA or City to demonstrate the conformance of the development with City plans and ordinances. The HRA or City may also use the Agreements to address other issues related to the development. Pursuant to M.S., Section 469.176, Subd. 5, no more than 25 percent, by acreage, of the property to be acquired in the District as set forth in the TIP Plan shall at any time be owned by the HRA or City as a result of acquisition with the proceeds of bonds issued pursuant to M.S., Section 469.178 to which tax increments from property acquired is pledged, unless prior to acquisition in excess of 25 percent of the acreage, the HRA or City concluded an agreement for the development or redevelopment of the property acquired. and which provides recourse for the BRA or City should the development or redevelopment not be completed. Subsection 2-23. Assessment Agreements Pursuant to M.S., Section 469.177, Subd. 8, the HRA or City may enter into a written assessment agreement in recordable form with the developer of property within the District which establishes a minimum market value of the land and completed improvements for the duration of the District. The assessment agreement shall be presented to the County Assessor who shall review the plans and specifications for the improvements to 1;>e constructed, review the market value previously assigned to the land upon which the improvements. are to be constructed and, so long as the minimum market value contained in the assessment agreement appears, in the judgment of the assessor, to' be a reasonable estimate, the County Assessor shall also certify the minimum market value agreement. Subsection 2-24. Administration of the District Administration of the District will be handled by the City Clerk. Subsection 2-25. Annual Disclosure Requirements Pursuant to M.S., Section 469.175, Subd. 5, 6, and 6b the HRA or City must undertake fmancial reporting for all tax increment financing districts to the Office of the State Auditor, County Board, County Auditor and School Board on or before August 1 of each year. M.S., Section 469.175, Subd. 5 also provides that an annual statement shall be published in a newspaper of general circulation in the City on or before August 15. If the City fails to make a disclosure or submit a report containing the information required by M.S., Section 469.175.Subd. 5 and Subd. 6, the OSA will direct the County Auditor to withhold the distribution of tax increment from the District. Subsection 2-26. Reasonable Expectations As required by the TIP Act, in establishing the District, the determination has been made that the anticipated development woUJ.d not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that 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 Hopkins HRA Tax Increment Financing Plan for Tax Increment Financing District No. J-3 2-13 increments for the maximum duration of the District permitted by the TIP Plan. In making said determination, reliance has been placed upon written representations made by the developer to such effects and upon lIRA and City staff awareness of the feasibility of developing the project site. A comparative analysis of estimated market values both with and without establishment of the District and the use of tax increments has been performed as described above. Such analysis is included with the cashflow in Appendix D, and indicates that the increase in estimated market value of the proposed development (less the indicated subtractions) exceeds the estimated market value of the site absent the establishment of the District and the use of tax increments. Subsection 2-27. Other Limitations on the Use of Tax Increment 1. General Limitations. All revenue derived from tax increment shall be used in accordance with the TIP Plan. The revenues shall be used to finance, or otherwise pay public redevelopment costs of the Redevelopment Project No. 1 pursuant to the MS., Sections 469.001 to 469.047. Tax increments may not be used to circumvent existing levy limit law. No tax increment may. be used for the acquisition, construction, renovation, operation, or maintenance of a building to be used primarily and regularly for conducting the business of a municipality, county, school district, or any other local unit of government or the state or federal government. This provision does not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure. 2. Pooling Limitations. At least 75 percent of tax increments from the District must be expended on activities in the District or to pay bonds, to the extent that the proceeds of the bonds were used to finance activities within said district or to pay, or secure payment of, debt service on credit enhanced bonds. Not more than 25 percent of said tax increments may be expended, through a development fund or otherwise, on activities outside of the District except to pay, or secure payment of, debt service on credit enhanced bonds. For purposes of applying this restriction, all administrative expenses must be treated as if they were solely for activities outside of the District. 3. Five Year Limitation on Commitment of Tax Increments. Tax increments derived from the District shall be deemed to have satisfied the 75 percent test set forth in paragraph (2) above only if the five year rule set forth in MS., Section 469.1763, Subd. 3, has been satisfied; and beginning with the sixth year following certification of the District, 75 percent of said tax.increments that remain after expenditures permitted under said five year rule must be used only to pay previously committed expenditures or credit enhanced bonds as more fully set forth in MS., Section 469.1763, Subd. 5. 4. Redevelooment District. At least 90 percent of the revenues derived from tax increment from a redevelopment district must be used to finance the cost of correcting conditions that allow designation of redevelopment and renewal and renovation districts under MS., Section 469.176 Subd. 4j. These costs include, but are not limited to, acquiring properties containing structurally substandard buildings or improvements or hazardous substances, pollution, or contaminants, acquiring adjacent parcels necessary to provide a site of sufficient size to permit development, demolition and rehabilitation of structures, clearing of the land, the removal of hazardous substances or remediation necessary for development of the land, and installation of utilities, roads, sidewalks, and parking facilities for the site. The allocated administrative expenses of the lIRA or City, including the cost of preparation of the development action response plan, may be included in the qualifying costs. Subsection 2.28. Summary The Hopkins Housing and Redevelopment Authority is establishing the District to preserve and enhance the tax base, redevelop substandard areas, and provide employment opportunities in the City. The TIP Plan for Hopkins HRA Tax Increment Financing Plan for Tax increment Financing District No. 1-3 2-14 the District was prepared by Ehlers & Associates, Inc., 3060 Centre Pointe Drive, Roseville, Minnesota 55113, telephone (651) 697-8500. Hopkins HR.A Tax Increment Financing Plan for Tax Increment Financing District No. 1-3 2.15 APPENDIX A PROJECT DESCRIPTION Tax Increment Financing District 1-3 is being established to facilitate the redevelopment of a portion of Main Street in the downtown area of Hopkins. The area consists of 13 buildings ofwlrich 7 have been deemed to be substandard. The tax increment district will contain two separate projects. The first project is a mixed- use project proposed by the Cornerstone Group. It is a continuation of the type of project they completed across the street. The project consists of approximately 60 for sale town homes and condos and 5,000 to 8,000 square feet of retail. The second project is proposed by GPS corporation and consists of approx 260 for sale condos and 8,000 to 12,000 square feet of retail space. GPS has completed a market study, relocation plan, geotechnical analysis. and has begun the phase 1 analysis of their site. . At the current time both projects have engaged architects for design. Both projects are scheduled to begin in the Fall of2005 with [mal phased completion in 2008 and 2009. APPENDIX A-I APPENDIX APPENDIX B MAP(S) OF REDEVELOPMENT PROJECT NO. 1 AND TIIE DISTRlCT B-1 . Redevelopment Project No.1 Tax Increment Financing District No. 1-3 City of Hopkins Hennepin County, Minn esota .. .. : i!l :> 9 ~ No. 1-3 CD PARK BDINA Tax Increment Financing District The shaded area represents Redevelopment Project No.1 .. r;'tt:.. -..~... .. ~l~l. ~IIC". CofICIOICf. ....1111..10. _111..A. "..,...... ....l-..z cr, ....--.. .....IUI.:..,.... -.... rp... --....... -~. ......IIllC... _.taIs..&. ... .. --: .. w 5 9 ti -< :z; Q 01 . f -< .. :z; ~ Z' Z' i -------- MINl'lBTOl'l1tA @ F N. s. --: .. Z' ~ Z' Z' i1 . B. , , . , . , (67) (66) , , , _._._~_.....- Tn r(62) __:1___:.._____ .'(65) 1 (3) " (91) m5), - - 1'1 1ST 5T N I'{ '.=.' . . t" -; ',: 00 GG z .' l.iJ > <( .r. +- co , '-iiiii ctAetACIMI " .' ." " . ' ....., !. , : lmD '(172)1 AllIiDIllI !'" ,', ',I'" ". , . (.43)" .. ~.L~~L:~_} . (~$.)" ~,; ~___l1~1__~. .....". .. "'>(47);; ~ ~.) 66 .r. +- l"- w. > <( =l." ;: ..; Hl4) 'f L (139) :....., L . i4' . . I'{ I'{ (4'2)' '/1. z F., ',(4'il.... I ", ~ '. . . .'. ".\ , ., , " ~., . .>. ,~,.. , (37) .,. :.,', ,(38) '''',;. -~ . (36) ',' ',', (40) ;'..~;::, " (39)' o z u o. o (26) , . (27) -'i7f- i?,8) (21l ".t." (22) j: @ ".' '(24)' (i~:8i ,. -- ." z. w > <( .r. +- UJ , >. ....... ..' (157) 33 '33'----,- '" , '" jot') .._._~-;;;.._.. . _._._._._._._._~.- n"': '-'-':'" '- /~ .' " ';:, ::' , 'i I: . , I I . {3 I I. I . I . " " " (II) W'L :>' ',,<C (v . " f z" " '- .0 .... TlF DI5tr.O.1-3 City of Hopkins Hennepin County, Minnesota . APPENDIX C DESCRIPTION OF PROPERTY TO BE INCLUDED IN THE DISTRICT The District encompasses all property and adjacent rights-of-way and abutting roadways identified by the parcels listed below. 241172242000S 33-6thAve.N. 33 - 6th Ave. N. Ltd. 12 Partnershi 2411722420006 Parking Lot Sth Avenue 7 Partnershi 24 1172242 0008 SI7 Mainstreet Sth Avenue 4A Partnershi 2411722420009 501 Mainstreet Sinclair Oil S Co oration 24 11722420012 44 - 5th Ave. N. Thomas W. Roof 11 2411722420013 30-SthAve.N. Sth Avenue 9 Partnershi 2411722420014 36-SthAve.N. Sth Avenue 10 Partnershi 24 1172242 001S 24-Sth Ave. N. Sth Avenue 8 Partnershi 24 11722420016 10-SthAve.N. Sth Avenue 6 Partnershi 24 11722420017 IS-6th Ave. N. Albert Feiler 13 24 11722420018 13-6thAve.N. 5th Avenue 14 Partnershi 2411722420019 Parking Lot Sth Avenue 15 Partnershi 24 177 22420029 66th AveN J D SilerandLA 17 Stroessner 24 1172242 0030 6 I1 Mainstreet Luther Co. Ltd. 16 Partnershi 2411722420031 Unassigned Luther Co. Ltd. 17 Partnershi 24 117 22 42 0032 Unassigned Luther Co. Ltd. .18 Partnershi 24 117 2242 0033 621 Mainstreet Luther Co. Ltd. 3 Partnershi 2411722420048 Unassigned Luther Co. Ltd. 1 Partnershi 24 117 22 42 0049 701 Mainstreet Luther Co. Ltd. 2 Partnershi 24 117 22 42 OOSO Unassigned Luther Co. Ltd. 17 Partnership APPENDIX Co! ---- ----------- n_ _ ----- 24 117 22 42 0056 19 EigbthAve. N. Luther Co. Ltd. 20 Partnershin 24 117 22 42 0057 21 8th Ave. N. . Luther Co. Ltd. 21 Partnershin 24 11722420166 525 Mainstreet Aleksandr Tenlitski 4 2411722420167 Unassigned Luther Co. Ltd. 4 Partnershin 2411722420169 Unassigned Luther Co. Ltd. 17 Partnershin . . - APPENDIX C-2 APPENDIX D ESTIMATED CASH FLOW FOR THE DISTRICT . APPENDIX D-1 5/2712005 HOPKINS 2411 PAGE 1 of6 CITY OF HOPKINS - MAIN STREET PROJECT A BASIC ASSUMPTIONS PLEASE READ ALL ASSUMPTIONS DIstrict NEW Redevelopment District Inflation Rate 5.0000% Pay As You Go Note Rate 1.00% Take out Revenue Note Rate 6.15% Take out Revanue Note Coverage 1.20% FIscal Dlsp. Contribution Ratio 26.0824% EST Pay 2005 PoolIng Assumptior 10.00% Class Rate Assumptiol'lS 1.5%-2.0% Assumes F1rstTax Inctement 2007 Years of Tax Increment 26 Assumes last Tax lnaement 2032 YearsofTaxlnaement 26 Assumes Nole Issued NlA Tax CapaClty (EJctenslon) Rate - Frozen 1.208390 Pay 2005 Tax Capaclty (extensIon) Rate. Current 1.208390 Pay 2005 State Education Rate 0.511012 Pay 2005 Area Wide Rate 1.298630 Pay 2005 Amount of Incnment will v.ry chpendlng upon IfIIIrbtvDlue, tax rates, cia. ret... conmuctlonac:haduIa,Mdlnfllltlononll'lllfket~. ln1\a:tIon ontul1d$ll =nnot_=-'''' FROZEN TAX CAPACITYPAYABI.E Pay 2005 -- TotalMarltet Class Base;~: P,O """" Address Value "to Caoae 4_117_22042-OO1~SthAv.Pllrtnerahlp 3O-5thAv.N. 541,000 24_117_22042-OO14SthAv.PlIIl1ll1NhIp 36-5thAv.N. 541,000 4-117.22-42-OO1S5thAv.~ 24-5thAv.N. 541,000 24-117..z2-42-OD165thAV.Partnemh~1o.SthAv.N. ....000 24-117-22-42-oooaSthAv.Pllrtnonlhip S1-7MalnalJMl 1,589,000 24_117_22-42-ooDl!SthAv.PllrtnerahIpPariclngLot 1.000 24-117_22-42-OO18SthAv.Pertnel1lhlp 13-6thAv.N. 1,000 24-117-22-42-OO19sthAv.PaIlllllNhlpParklngl.ot 1,000 4-117-22-42-00051 SlncIalrOIlCorp. 501 MaIn street 294,000 24-117_22-42.o166A1O!1Xl1ooIllTeplhld525Malnstreel 231,000 24-117.22-42-0017 -,- 15-6thAv.N. 209,000 24-117-22-42-0012 ThomaIW.Roof 44-5IhAv.N. 131,000 24-117-22-42-0005 33-6AvNPtnsIla 33-6thAv.N. 2 451 000 ,... 7419000 Commercllll 1.91% 141,817 1.5%-2.0% 2,086 Hou.l..... 98.09% 72n 183 1.00% 72.n2 ,.., 7419000 74,858 TAXES PAYABl.E ToIo' City FIsC. Development Tox Tox Tox City FIs"" State ED '010' T";" Cana'dfv Ca a""" Cana""" T."" Tox~ To>~ Taxes FQrSaloUnb 903,127 903,121 0 1,091,330 0 0 1,091,330 Reet.aullInt 8,050 5,950 2,100 7,190 2,727 4,114 14,031 Reet.au.-nt 8050 59SO 2100 7190 2.727 4114 14031 ,.., 919227 915.028 4.199 1,105710 5,453 8,227 1119391 PROJECTVAI.UE INFORMATION Numberof ToIo' T'F Sq, Fl.~ c~~Per Percent Of U.'" Markel Tox 'ox To> T- U.'" .Fl UnIts 250 Value "to Ca d'" Ca;'~clhz Paullble ForSaIoUniIs 344,705 262 100.00% 50.00% 45,156,355 1.00% 451,564 451,564 2008 R_ul1lnt 4,400 100 NlA NlA 440.000 1.5%-2.0% 8,050 5.950 2008 ReItau..nt 4400 100 toA toA 440 000 1.5%02.0% 8.050 5.950 2008 ,.., 48 038 355 467.664 483 464 PROJECT VALUE INFORMATION Number of Total TIF Sq.Fl.- Cost Per PercantOf U.'" Market Tox '0> To> T U.'" Sn.Ft U""' 250 Value "to C."acilv Ca"';'l'ltv P""sble ForSaIeUnlls 344.705 262 100.00% 100.00% 90,312,110 1.00% 903,127 903.127 2008 ....... 4.400 100 toA NlA 440.000 1.5%-2.0% 8.050 5.950 2009 Reet.aunITIl 4400 100 . N/A NlA 440 000 1.5%-2.0% 80SO 69SO 2009 '''"' 91192710 919,227 915028 Cashflow5-17~5 51.2712005 HOPKINS 2_11 PAGE 2 of6 cm OF HOPKINS. MAIN STREET PROJECT A TAX INCREMENT CASH FLOW An""" P,",oeI MnusFisOls Captured Seml-AMual Auditor Administration SemJ.Annual EndlngPorIod B:s~ r" TaxCapaClty Tax Capacity Gm" G"", PAYMENT DATE M1h. y,. C. Ca';;~ Increment 0.36% 10.00% Increment M1h. y,. l-Feb 2005 74,858 74,858 0 0 0 0 0 l-Aug 2005 ,...., 2005 74,858 74,858 0 0 0 0 0 Hob 2006 l-Feb 2006 74,858 74,858 0 0 0 0 0 0 0 1-Aug 2006 '-Aug 2006 74,858 74,858 0 0 0 0 0 0 0 1-Feb 2007 1-Feb 2007 74,858 74,858 0 0 0 0 0 0 0.5 l-Aug 2007 '"'''' 2007 74,858 74,858 0 0 0 0 0 0 '.0 1.Feb 2008 '-Fob 2008 74,858 463,464 3.655 384,951 232,585 (837) (23,259) 208,490 1.5 l-Aug 2008 ,.Aug 2008 74,858 463,464 3.655 384,951 232.595 (837) (23,259) 208,490 2.0 '-Fob 2008 1-Feb 2009 74.858 915,028 3,655 836,515 505,418 (1,820) (50.542) 453,057 2.5 l-Aug 2008 l-Aug 200' 74,858 915,028 3.655 836,515 505,418 (1,820) (50,542) 453.057 3.0 '-Fob 2010 1-Fob 2010 74,858 915,028 3,655 636.515 505.418 (1,820) (50,542) 453.057 as '-Aug 2010 ,.."" 2010 74.858 915,028 3.655 836,515 505,418 (1,820) (50,542) 453.057 4.0 '-Fob 2011 1.Feb 2011 74.858 960,779 3.838 882,~ 532.950 (1,919) (53,295) 4n,737 4.5 1-Aug 2011 ,....' 2011 74.858 960,779 3,838 882,083 532,950 (1,919) (53,295) 477,737 5.0 1-Feb 2012 1-Feb 2012 74,858 1,008,818 4,030 929,930 561,859 (2,023) (56,186) 503,651 5.5 1-Aug 2012 1-Aug 2012 74,858 1,008,818 4,030 929,930 561,859 (2,023) (56,186) 503,651 6.0 1-Feb 2013 1-Feb 2013 74,658' 1,059.259 4,231 980,170 592,214 (2,132) (59,221) 830.860 '.5 1-Aug 2013 1-Aug 2013 74,858 1,059,259 4,231 980,170 592,214 (2,132) (59,221) 530,860 7.0 1-Feb 2014 1.Feb 20'4 74,858 1,112,222 4,443 1,032,921 624,086 (2,247) (62,409) 559,430 7.5 1-Aug 2014 1-Aug 2014 74,858 1,112,222 4.443 1,032,921 624,086 (2,247) (62,409) 559,430 '.0 1-Feb 2015 1.Feb 2015 74,858 1,167,833 4,665 1,088,310 657,551 (2,367) (65,755) 569,429 '.5 1-Aug 2015 1.Aug 2015 74,856 1,167,833 4,665 1,088,310 657,551 (2,367) (65,755) 589,429 9.0 '-Fob 2015 1-Feb 2016 74,858 1,226,225 4,898 1,146,468 692,691 (2,494) (69,269) 620,928 9.5 1-Aug 2016 1.Aug 2016 74,858 1,226,225 4,898 1,146,468 692,691 (2,494) (69,269) 620,928 10.0 '-Fob 2017 1-Feb 2017 74,856 1,287,536 5,143 1,207,535 729,586 (2.627) (72,959) 654,001 10.5 ,...., 2017 1-Au9 2017 74,658 1,287,536 5.143 1,207,535 729,566 (2,627) (72,959) 654,001 11.0 1-Feb . 2018 1-Feb 2018 74,858 1,351,913 6.400 1,271,654 768,327 (2,766) (76,833) ....729 11.5 ,.."" 2018 '"'''' 2016 74,858 1.351,913 5,400 1,271,654 768.327 (2,766) (76,833) 688.729 12.0 1-Feb 2019 1-Feb 2019 74,858 1,419,508 5,670 1,338,980 609.005 (2,912) (80.901) 725,192 12.5 ,.."" 2019 '-Aug 2019 74.656 1,419,508 5.670 1,338,980 609.005 (2,912) (80,901) 725,192 13.0 '-Fob 2020 1-Feb 2020 74.656 1,490,484 5,954 1,409,672 851,717 (3,066) (85,172) 763,479 13.5 '"'''' 2020 ,"'''' 2020 74,658 1 ,490,484 5,954 1,409,672 851,717 (3,066) (85,172) 763.479 14.0 1-Feb 2021 1.Feb 202' 74,858 1 ,565,008 6,251 1,483,898 696.664 (3,228) (89,656) 803,680 14.5 1-Au9 2021 1-Au9 2021 74,858 1,565,008 6,.251 1,483,898 696.664 (3,228) (89,656) ~03,680 15.0 1-Feb 2022 1-Feb 2022 74,858 1,643,259 6,564 1,561,836 943.654 (3,397) (94,365) 845,891 15.5 1-Aug 2022 1-Aug 2022 74,858 1,643,259 6.564 1,561,838 943.654 (3,397) (94,365) 845,891 16.0 l-Feb 2023 1-Feb 2023 74,858 1,725,421 6.892 1,643,671 993,098 (3,575) (99,310) 890,213 16.5 1-Au9 2023 1-Aug 2023 74,858 1,725,421 6,892 1,643,671 993,098 (3,575) (99,310) 890,213 17.0 l.feb 2024 1-Feb 2024 74,858 1,811,693 7,237 1,729,698 1,045,014 (3,762) (104,501) 936,751. 17.5 1-Aug 2024 ,...., 2024 74,858 1,811,693 7,237 1,729,598 1,045,014 (3,762) (104,501) 936,751 18.0 1-Fob 2025 1-Feb 2025 74,658 1,902,277 7,599 1,819,820 1,099,526 (3,958) (109,953) 985.615 18.5 1-Au9 2025 1-Aug 2025 74,858 1,902,277 7,599 1,819,820 1.099.526 (3,958) (109,953) 985,615 19.0 '-Fob 2025 1-Feb 2026 74.658 1,997,391 7,979 1,914,554 1,156,764 (4,164) (115,676) 1,036,923 19.5 '"'''' 2026 1-Aug 2026 74,858 1,997,391 7,979 1,914,554 1,156.764 (4,164) (115,676) 1,036.923 20.0 1-Fob 2027 1-Feb 2027 74,858 2.097,261 8,378 2,014.025 1,216.864 (4,381) (121,686) 1,090,797 20.5 '"'''' 2027 ,...., 2027 74,858 2.097,261 8,378 2,014,025 1,216,864 (4,361) (121,686) 1,090,797 21.0 '-Fob 2028 1-Feb 2028 74,858 2,202,124 8.796 2.118,469 1,279,968 (4,608) (127,997) 1.147,384 21.5 1-Aug 2026 ,...., 2028 74,858 2,202,124 8,796 2,118,469 1,279,968 (4,608) (127,997) 1,147,364 22.0 1-Feb 2029 1-Feb 2029 74.656 2,312,230 9~36 2,228,135 1,346,228 (4,846) (134,623) 1,206,759 22.5 1-Aug 2029 1.Aug 2029 74.858 2,312,230 9,236 2,228,135 1,346,228 (4,846) (134,623) 1,206,759 23.0 1.feb 2030 1-Feb 2030 74,858 2,427,841 9,698 2,343,285 1,415,801 (5,097) (141,560) 1,269,124 23.5 1-Aug 2030 1-Aug 2030 74,658 2,427,841 9,698 2,343,285 1,415,801 (5,097) (141,580) 1,269,124 24.0 1-Feb 2031 '-Feb 2031 74,858 2,549,233 10,183 2,464,192 1,488,853 (5,360) (148,885) 1,334,607 24.5 1-Aug 2031 1.Aug 2031 74,856 2,549,233 10,183 2,464,192 1,488,853 (5,360) (148,886) 1,334,607 25.0 l-Feb 2032 '-Feb 2032 74,858 2,676,695 10,692 ~,~~,,146 ~~,~57 i~'::! i~56.5':: 1,403,365 25.5 1-Aug '2032 1.Aun 2032 74858 2676695 10692 2 91145 1 557 166556 1 403 365 26.0 1-Feb 2033 TOTALS 45,022.597 (162,081) (4,502,260) 40.358,256 PRESENT VALUE 15,704,792 (56.537) 14.0n,TIt; Cashflow5-17.eS 512712005 PAGE3of6 CITY OF HOPKINS - MAIN STREET PROJECT B BASIC ASSUMPTIONS PLEASE READ ALL ASSUMPTIONS Distnct: NEW Redevelopment DIstrict Inflation Rate 5.0000% Pay As You Go Note Rate 6,75% Take out Revenue Note Rate NIA Talee out Revenue Note COV8l'sge NIA Fiscal Disp.Contrlbutlon Ratio 26.4202% EST Pay 2005 Pooling Assumption 10.00% Class Rate Assumptions 1.5%-2.0% Assumes First Tax Increment 2007 Years of Tax Increment 26 Assumes last Tax Increment 2032 Years of Tax Increment 26 Assumes Note Issued NJA ax Capacity (Extension) Rate - Frozen 1.208390 Pay 2005 Tax CapaCity (Extension) Rate ~ Current 1.208390 Pay 2005 State Education Rate 0.541090 Pay 2005 Area Wide Rate 1.371070 Pay 2005 A.rnountoflncl'8rnentwlIIVllrydl""ndlnguponmlrkltvallH,taxrate.,cl"lrltll, conl$tnIctlo:,:,':dUII, IIlId lnnatlon on m.rket vlllM, inflation on tax rlllll CIInnolbee. red. -. FROZEN TAXCAPACllY PAYABLE Pay 2005 Total Mar1<et Class Bases: .10 Own" Address Value Ral. CSoSI' 4-117-22-42-0033 130,300 4-117.22-42-0032 77,000 24-117...22-42-0031 14,000 4-111-22-42~ 89,000 24-111-22-42-0049 493,500 4-111-%2-42-0050 117,000 24-117-22-42.Q048 210,000 4-111-22-42'()161 48.000 24-111-22-42-0056 32,000 24-111_22-42.()189 48.000 24-111-22-42-0051 n,OOO 4-117-22-42..oo2ll 230 000 Total 1565,800 Co=c111 9.94% 157,621 1,5%~2.0% 2,402 Ho~ 90.06% 1,428,179 1.00% 14,282 ,ota, 1.58 800 16,684 PROJECT VALUE INFORMATION Numberof Development Sq~ Ft.- ToIlIl Colrt Units Taxes Per Tota' Market Tox Tox T";" UnIts PerUnt 60 S....Ft.Unlt T_ Value Ra~ Cao~crtv Assessable Pavabl """"" 1,022 220.000 51 $2,658 $135,581 11,220,000 1.00% 112,200 2007 200' -- 2,365 490,000 9 55,921 $53.290 4,410,000 1.00% 44,100 2007 200. ..... 5.518 163.10 5,518 $5.60 $30.920 900,000 1.5%-2.0% 11,250 2007 200. ,,'" 5,578 $219,791 16 530,000 173.550 TAXES PAYABLE Total Clty F1sDis Development Tox Tox Tox City AsDls State ED T";'. Canacl'" Ca"'a~ltv Can;~ Taxes Taxes Tox" eo"", 112,200 112,200 0 135,561 0 0 Townhom8l$ 44,100 44,100 0 53,290 0 0 ReI,11 17,250 12,693 4.557 15,338 6,249 9.334 Totel 173,550 168,993 4,551 204,209 6249 9334 - Cashflow s..17.o5 --- - ----- 5/27J2005 PAGe 4of6 CITY OF HOPKINS - MAIN STREET PROJECT B TAX INCREMENT CASH FLOW Annual Project Minus FisDis Captured Seml-Annual Auditor Administration Pooling Semi-Annual ending Period Base Tax Tax Tax Capacity Tax Capacity "",,, ""''' PAYMENT DATE Mlh. Yr. Canacitv CIIMcitv Increment 0.36% 10.00% 15.00% Increment Mlh. Yr. 1.Feb 2005 16,684 16,684 Present Value Date August 2005 1-Aug 2005 1-Aug 2005 16,684 16.684 0 0 0 0 0 0 0 1-Feb 2005 1-Feb 2006 16,684 16.684 0 0 0 0 0 0 0 ''''"9 2006 1.Aug 2006 16.684 16,684 0 0 0 0 0 0 0 1-Feb 2007 1-Feb 2007 16,684 16,684 0 0 0 0 0 0 0 ''''"9 2007 ''''"9 2007 16,684 16,684 0 0 0 0 0 0 0 1-Feb 2008 1-Feb 2008 16,684 173.550 3,923 152,943 92,407 (333) (9.241) (13,861) 68,973 1-Aug 2008 1-Aug 2008 16.684 173,550 3,923 152,943 92,407 (333) (9,241) (13,861) 68,973 1-Feb 2009 1-Feb 2009 16.684 ' 182,228 4,119 161,424 97,532 . (351) (9,753) (14,630) 72,798 1-Aug 2009 1-Aug 2009 16,684 182,228 4,119 161,424 97,532 (351) (9,753) (14,630) 72,798 1-Feb 2010 1.Feb 2010 16.684 191,339 4,325 170,330 102,912 (370) (10,291) (15,437) 76,814 i-Aug 2010 i-Aug 2010 16,684 191,339 4,325 170,330 102,912 (370) (10,291) (15,437) 76,814 1-Feb 2011 1-Feb 2011 16,684 200,906 4,541 179,681 108,562 (391) (10,856) (16,284) 81,031 ''''"' 2011 1-Aug 2011 16,684 200,906 4,541 179,681 108,562 (391) (10,856) (16.284) 81,031 1-Feb 2012 1-Feb 2012 16,684 210,951 4,768 189,499 114,494 (412) (11.449) (17.174) 85,458 ''''"' 2012 1-Aug 2012 16,684 210,951 4.768 189,499 114,494 (412) (11.449) (17,174) 85,458 1-Feb 2013 '-Feb. 2013 16,684 221,499 5,007 199,808 120,723 (435) (12.072) (18,108) 90,108 1"'", 2013 1-Aug '2013 16,684 ~1,499 5,007 199,80S 120,723 (435) (12,072) (18.108) 90,108 1-Feb 2014 '-Feb 2014 16.684 232,574 5,257 210,633 127,263 (468) (12,726) (19.089) 94,989 ''''"' 2014 1-Aug 2014 16,684 232,574 5,257 210,633 127,263 (458) (12,726) (19,069) 94,989 1-Feb 2015 1-Fab 2015 16;684 244,202 5,520 221,998 134,130 (483) (13,413) (20,120) 100,115 ''''"' 2015 1-Au9 2015 16,684 244,202 5,520 221,998 134,130 (433) (13,413) (20,120) 100,115 1-Feb 2016 1.Fab 2016 16,684 256,412 5,796 233,932 141,341 (S09) (14,134) (21.201) 105,497 ''''"9 2016 1-Aug 2016 16,684 256,412 5,796 233,932 141,341 (S09) (14,134) (21,201) 105,497 1-Fab 2017 1-Fab 2017 16,684 269,233 6,085 245,463 148,912 (536) (14,691) (22.337) 111,148 1-Au9 2017 1-Au9 2017 16,684 269,233 6,085 246,463 148,912 (536) (14,891) (22.337) 111,148 1.Fab 2018 1-Fab 2018 16,684 282,695 6.390 259,621 156,862 (565) (15,6B6) (23,529) 117,081 1-Aug 2018 1",", 2018 16,664 282,695 6,390 259,621 156,862 (565) (15,686) (23,529) 117,081 1-Feb 2019 1-Fab 2019 16,664 296,829 6,70S 273,436 165,209 (695) (16,521) (24,781) 123,312 ''''"' 2019 ''''"9 2019 16,684 296,829 6,709 273,436 . 165,209 (695) (16,521) (24,781) 123,312 1-Feb 2020 1-Feb 2020 16,684 311,671 7.045 287,942 173,973 (626) (17,397) (26,096) 129,854 ''''"' 2020 1-Aug 2020 16.684 311,671 7,045 287,942 173,973 (626) (17,39n (26,096) 129,854 1-Fab 2021 1-Fab 2021 16,684 327,254 7,397 303,173 183,176 (659) (18,318) (27,476) 135,722 ''''"' 2021 1-Aug 2021 16,684 327,254 7,397 303,173 183,176 (SS9) (18,318) (27,476) 136,722 1-Fab 2022 1.Feb 2022 16,684 343,617 7,767 319,166 192,S39 (694) (19,284) (28,928) 143,935 1-Aug 2022 1-Aug 2022 16,684 343,617 7,767 319,166 192,839 (694) (19,284) (28.926) 143,935 1-Fab 2023 1-Feb 2023 16,684 360,798 8,155 335,959 202,985 (731) (20,298) (30,448) 151,508 1-Aug 2023 1-AIlg 2023 16,684 360,798 8,155 335,959 202,985 (73') (20,298) (30,448) 151,508 1-Fab 2024 1-Feb 2024 16,664 378,838 ~683 353,591 213,638 (769) (21,364) (32.046) 159,459 ''''"9 2024 1-Aug 2024 16,684 378,838 8,563 353,591 213,638 (769) (21,364) (32,046) 159,459 1-Feb 2025 1-Feb 2025 16,684 397,780 8,991 372,105 224,824 (809) (2~432) (33.724) 167,808 1-Aug 2025 1-Aug 2025 16,684 397,780 8,991 372,105 224,824 (609) (22.482) (33,724) 167,808 1-Fab 2026 1-Fab 2026 16,684 417,669 9,441 391,544 236,569 (662) (23,657) (35,485) 176,575 1-Aug 2026 1-Aug 2026 16,684 417,669 S,441 391,544 236,569 (852) (23,657) (35,485) 176,575 1-Fab 2027 1-Feb 2027 16,684 438,552 9,913 411,955 248,901 (896) (24,B90) (37,335) 1B5,7BO 1-Aug 2027 1-AIlg 2027 16,684 438,552 9,913 411,955 248,901 (896) (24,B90) (37,335) 185,780 1-Feb 2028 1.Fab 2028 16,684 460,480 10,408 433,387 261,850 (943) (26,185) (39,278) 195,445 1-Aug 2026 1-AIlS 2026 16,684 460,480 10,408 433,387 261,850 (943) (26,185) (39,278) 195,445 1-Fab 2029 1-Fab 2029 16,884 483,504 10,929 455,891 275.447 (992) (27,545) (41,317) 205,594 1-Aug 2029 1.Aug 202' 18,684 483,504 10,929 455,891 275,447 (992) (27,545) (41,317) 205,594 1-Fab 2030 1-Fab 2030 16,684 507,679 11,475 479,520 289,723 (1,043) (28,972) (43.459) 216,250 1-Au9 2030 1-Aug 2030 16,684 507,679 11,475 479,520 289.723 (''''3) (28,972) (43,459) 216,250 1-Feb 2031 1-Feb 2031 16,684 533,063 12,049 504,330 304,714 (1,097) (30.471) (45,707) 227,438 1-Aug 2031 1.Au9 2031 16,684 533,083 12,049 504,330 304,714 (1,097) (30,471) (45,707) 227.43B 1-Feb 2032 1-Feb 2032 16,684 559,716 12,851 530,381 320,453 g:'~~ i;2,04~! i~'oe:! 239,186 1-Aug 2032 i-AIle _ 2032 16,684 .559,716 .- j2,651 530,3B1 320,453 . 1,154 . 32,045 48.068 239,.188 .1-Feb 2033 TOTAlS 9,278,Sn (33,404) (927,888) (1,391,832) 6,925.754 PRESENT VALUE 3,166,368 (11,399) (316,637) (474,955) 2,363,371 Cashflow 5.17.05 , 512712005 HOPKINS 2-11 CITY OF HOPKINS - MAIN STREET Summary PAGE 50f6 BASIC ASSUMPnONS PLEASE READ ALL ASSUMPnONS NEW Redevelopment DIstrict 6.0000% 7.00'" 6.75'" 1.20'" 26.0824% 10.00% Dls1l'lct IrrftatlonRata Pay As You Go Note Rate Take out Revenue Note Rate Take out Revenue Note Coverag$ FIscal Dlsp. Con1l1bution Ratio Poonng Assumption Ctass Rate Assumptions Assumes Rm Tax Increment Years of Tax Increment Assumes Last Tax Increment Years of Tax Increment Assumes Note Issued Tax Capacity (extension) Rate - Frozen Tax Capacity (extension) Rate - Current State EducatIOn Rate Area WIde Rate Amountot~ntwlllvaJ'fdependlntllpQllln8rbtvalue.tu.l'lIla.c1au ratn, =::..:h~~...anclfnflatiOllonll'lBlbtv.ltM.lnnllllonOllta:xnta 2007 2. 2032 26 NfA 1.208390 1.208390 0.511012 1.298630 EST Pay 2005 F'ay2005 Pay 2005 F'ay2005 Pay 2005 Cashflow 5-17.05 ----- 5127/2005 HOPKINS 2.11 PAGE6of6 CITY OF HOPKINS .MAIN STREET Summary TAX INCREMENT CASH FlOW Annual Project MlnusFlsDls Captured Semi-Annual Auditor AdminIstration Seml-Annual EndIng Perlod BeseTax Tox TaxCapadty TaxCapactty 0"'" Om" PAYMENT DATE M~. v.. Canaatv C,M"'" Increment 0.36% 15.00% Increment M~. y,. 1-Feb 2005 91,542 91.542 0 0 0 0 0 1-Aug 2005 '-A"" 2005 91,542 91,542 0 0 0 0 0 1-Feb 2006 Hob 2006 91,542 91,542 0 0 0 0 0 0 0 1-Aug 2006 1-Aug 2006 91,542 91,542 0 0 0 0 0 0 0 1.feb 2007 1-Feb 2007 91,542 91,542 0 0 0 0 0 0 0.5 l-A"" 2007 1.Aug 2007 91,542 ".542 0 0 0 0 0 0 1.0 1-Feb 2008 1.Feb 2008 91,542 631,014 (7,518) 537,894 324,993 (1,170) (46,360) 277,463 1~ l-A"" 2006 1-Aug 2008 91.542 637,014 (7,578) 537,894 324,993 (1,170) (46,360) 277,463 2.0 1-Feb 2009 1.Feb 2009 91,542 1,097,255 (7,774) 997,939 602,950 (2,171) (74,925) 525,854 2.5 1-Aug 2009 1-Aug 2009 91,542 1,097,255 (7,774) 997,939 602,950 (2,171) (74,925) 525,854 3.0 1-Feb 2010 1-Feb 2010 91,542 1,106,367 (7.'SO) 1,006,844 608.330 (2,190) (76,270) 529,870 35 l-A"" 2010 l-A"" 2010 91,542 1,106,367 (7,980) 1,006,844 608,330 (2.190) (76,270) 529,870 4.0 '.fob 2011 1-Feb 2011 91,542 1,161,685 (8,379) 1,061,764 641,512 (2,309) (SO.436) 558,767 45 l-A"" 2011 1-Aug 2011 91,542 1,161,685 (8.379) 1,061,764 641,512 (2,309) (80,436) 558,757 5.0 1-Feb 2012 1-Feb 2012 91,542 1,219,769 (8,798) 1,119,429 676,353 (2,435) (84,809) 589,109 5.5 1-Aug 2012 1-Aug 2012 91,542 1,219,759 (8,798) 1,119,429 576,353 (2,435) (84,809) 589,109 5.0 1-Feb 2013 1-Feb 2013 91,542 1,280,758 (9,238) 1,179,978 712,937 (2,567) (89,402) 620,968 5.5 1-Aug 2013 1~ug 2013 91,542 1,280,758 (9,238) 1,179,978 712,937 (2,567) (89,402) 620,968 7.0 1-Feb 2014 1-Feb 2014 91.542 1,344,796_ (9,700) 1,243,554 751,349 (2,705) (94,224) 654,420 7.5 1-Aug 2014 l-A"" 2014 91,542 1,344,796 (9,700) 1.243,554 751,349 (2,705) (94,224) 654,420 8.0 1-Feb 2015 1-Feb 2015 91,542 1,412,035 (10,185) 1,310,308 791,682 (2,850) (99,288) 689,544 as 1-Aug 2015 1-Aug 2015 91,542 1,412,035 (10,185) 1,310,308 791,682 (2,850) (99,288) 689,544 '.0 1.feb 2016 1.Feb 2015 91,542 1,482,537 (10,694) 1,380,401 834,031 (3,003) (104,604) 726,425 '.5 1-Au9 2016 1-Au9 2015 91,542 1,482,537 (10,694) 1,380,401 834,031 (3,003) (104,504) 726,425 10.0 1-Feb 2017 1-Feb 2017 91,542 1,556,759 (11,229) 1,453,998 878,498 (3,163) (110,187) 765,149 10.5 1-Aug 2017 1-Aug 2017 91,542 1,556,769 (11,229) 1,453,998 878,498 (3,163) (110,187) 765,149 11.0 1-Feb 2018 1-Feb 2018 91,542 1,634,608 (11,790) 1,531,275 925,189 (3,331) (116,048) 805,810 11.5 1-Aug 2018 1-Aug 2018 91,542 1,834,608 (11,790) 1,531.275 925,189 (3,331) (115,048) 805,810 120 l.fob 2019 1-Feb 2019 91,542 1,716,338 (12,380) 1,612,415 974,214 (3,507) (122.203) "',504 '25 1-Aug 2019 1.Aug 2019 91,542 1,715,338 (12,380) 1,512,416 974.214 (3,507) (122,203) ....504 130 1-Feb 2020 1-Feb 2020 91,542 1,8Q2,155 (12,998) 1,697,614 1,025,690 (3,692) (128,685) 893,332 13.5 1-Aug 2020 1-Aug 2020 91,542 1.802,155 (12,998) 1,697,614 1,025,590 (3,692) (128,665) 893,332 14,0 1-Feb 2021 1.Feb 2021 91,542 1,892.263 (13,64B) 1,787,072 1,079,740 (3,887) (135,450) 940,402 14.5 1.Au9 2021 1-Aug 2021 91,542 1,892,263 (13,648) 1,787,072 1,079,740 (3,887) (135,450) 940,402 15.0 1-Feb 2022 1.Feb 2022 91,542 1,98&,876 (14,331) 1,881,002 1,136,492 (4,091) (142,575) 989,826 15.5 1-Aug 2022 1-Aug 2022 91,542 1,986,876 (14,331) 1,881,002 1,136,492 (4,091) (142,575) 989,826 16.0 1-Feb 2023 1.Feb 2023 91,542 2,086,219 (15,047) 1,979,630 1,196,082 (4,306) (150,056) 1,041,721 16.5 1-Au9 2023 l-A"" 2023 91,542 2,086.219 (15,047) 1,979,630 1,196.082 (4,306) (150,056) 1,041,721 17.0 1-Feb 202. 1.Fel:I 2024 91,542 2,190,530 (15,800) 2,083,188 1,258,552 (4,531) (157,911) 1,096,210 17.5 1-Aug 202' 1-Aug 2024 91,542 2,190,530 (15,800) 2,083,188 1,258,652 (4,531) (157,911) 1,096,210 18.0 1.feb 2025 '.fob 2025 91,542 2,300,057 (16,590) 2,191,925 1,324,350 (4,768) (166,159) 1,153,424 18.5 1-Aug 2025 l-Au. 2025 91,542 2,300,057 (16,590) 2,191,925 1,324,350 (4,768) (166,159) 1,153,424 19.0 1-Feb 2026 l.fob 2025 91,542 2,415,060 (17,419) 2,306,098 1,393,333 (5,015) (174,819) 1,213,498 19.5 1-Au9 "'" ,_ 2025 91,542 2,415,060 (17,419) 2,306,098 1,393,333 (5.016) (174,819) 1,213,498 20.0 1-Feb 2027 l.fob 2027 91,542 2,535,813 (18,290) 2,425,980 1,465,765 (5,277) (183,912) 1,275,577 20.5 1-Au9 2027 1-Aug 2027 91,542 2,535,813 (18,290) 2,425,980 1,465,765 (5,2n) (183,912) 1,276,577 21.0 1.feb 202. 1-Feb 2028 91,542 2,662,603 (19,205) 2,551,856 1,541,819 (5,551) (193,459) 1,342,809 21.5 1-Aug 202. 1-Aug 2028 91,542 2,662,603 (19,205) 2,551,856 1,541,819 (5,551) (193,459) 1,342,809 22.0 1-Feb 2029 1-Feb 202. 91,542 2,795,734 (20,165) 2,884,026 1,621,675 (5,838) (203,485) 1,412,353 22.5 1-Aug 2029 1-Au9 2029 91,542 2,795,734 (20,155) 2,684,026 1,621,575 (5,838) (203,485) 1,412,353 _ 23.0 1-Feb 2020 1.feb 2030 91,542 2,935.520 (21,173) 2,822,805 1,705,524 (6,140) (214,011) 1,485,374 23.5 l-A"" 2020 1-Aug 2030 91,542 2,935,520 (21,173) 2,822,805 1,705,524 (6,140) (214,011) 1,485,374 24.0 1.feb 2031 1-Feb 2031 91,542 3,082,296 (22.232) 2,968,522 1,793,568 (6,457) (225,064) 1,562,046 24~ 1-Au9 2031 1-Au9 2031 91,542 3,082.296 (22.232) 2,968,522 1,793,566 (6,457) (225,064) 1,662,046 25.0 1-Feb 2032 1-Feb 2032 91,542 3,236,411 (23,343) 3,121,525 1,886,010 (6,790) (236,669) 1,642,551 25.5 1-Au9 2002 1-Au.. 2032 91,542 3236411 i23.343i 3121525 1,886010' i5,790i 236,669i 1,642 551 26.0 1-Feb 2033 TOTALS 54.301,474 (195,485) (6,821,979) 47,284,010 PRESENT VALUE 18,871,160 (67,936) 16,520,917 Cashflow5.17.oS APPENDIX E MINNESOTA BUSINESS ASSISTANCE FORM (MINNESOTA DEPARTMENT OF EMPLOYMENT AND ECONOMIC DEVELOPMENT) APPENDIX E-! Please rill in date agreement signed (same as question 21) Minnesota Business Assistance Form . The Minnesota Business Assistance Form (MBAF) is used to report each b)lSiness subsidy and financial assistance agreement signed fromAullust 1.1999 tllroullll December 31.2003 unless goals have been achieved and reported in a MBAF perMinn. Stat. ~1l6J.993 to ~1l6J.995. . The following government agencies must submit a MBAF: 1) any local government/agency that signed a business subsidy agreement since January 1, 1999, or represents a population of more than 2,500; 2) all state government agencies authorized to provide business subsidies. . If a local or state government agency that is required to report has not done so by Apri11, DEED will mail a warning. If it fails to report by June 1, it may not award any business subsidies until a report has been filed. . Questions? Call (651) 296-0580. InfoI1l1lltion on where to mail or fax your completed MBAF(s) is on page 4. Section 1 Grantor Information I. Name of grantor (funding entity) 2. Name of person completing this form 3. Street address 4. City 5. ZIP code 6. County 7. Phone number 8. Fax number 9. E-mail address 10. Please indicate who in your organization should receive the MBAF if different from the person in Question 2. NamelTitle Phone number Street address City ZIP code . 11. Classification of grantor (Mark one. If grantor is entity created by gov 't agency, please indicate affiliation. For example, a city EDA would check "City government. '? 12. Has your organization held a public hearing on and adopted criteria for awarding business subsidies in compliance with Minn; Stat ~I 161.994? (Mark one.) . <:ity government . .y 05, in 2004 (attach criteria) . .Yes, in 2004 but have not yet adopted criteria . .Yes, prior to 2004 . -COunty government . -Regional government If Yes: Hearing Date: Year Criteria Submitted: . -State government . <Other (please specifY.) . -No . oOther (please attach explanation.) 13. Has your organization signed any agreements to award a business subsidy or financial assistance from August 1, 1999 tbrongh December 3 I, 2003 unless goals have been achieved and reported in a previous fllad MBAF? (Mark on..) . .Yes (Complete the remainder of the form unless goals have been achieved and . -No (S.tOD here. go to section 5 on page 4.) reported in a previously filed MBAF per Minn. Stat. 81161993 and 8116./.994.) Section 2 Reci ient Information 14. Name of business or organization receiving subsidy or financial assistance 15. Address where business subsidy or financial assistance will be used Street address City State ZIP code 16. Does the recipient have a parent corporation? (Mark one.) . .Yes (Indicate name and address of parent corporation below. lfmore than one, indicate ultimate owner.) . -No Name of parent corporation Street address City State ZIP code Minnesota Business Assistance Form (1114/04) Page 1 of4 Dept of Employment & Economic Development ----- 17. Industry of recipient's facility (Mark one.): . -Manufacturing . -Services . -Finance. Insurance. Real Estate . -Retail Trade . 'Wholesale Trade . -Construction . >Other lP'ease specitY) 18. Did the recipient relocate as a result of signing this agreement? (Mark one.) . .Yes (Indicate city and state of previous pddress and reason recipient did not complete this project at that address.) . -No (Go ro Question 19.) City/Stale of previous address Reason project not completed at previous address 19. Would the recipient have remained in previous location or relocated elsewhere if not awarded this business subsidy or financial assistance? (Mark one.) . -Remained at previous location . -Relocated to different Minnesota location . -Relocated outside Minnesota Section 3 Al!reement Information 20. Total dollar value of business subsidy or financial 21. Date agreement signed (In addition to the agreement assistance (Please separate value by type in Questions 24 date, indicate any dates the agreement was amended.) and 25.) 22. Benefit date (Indicate the date the recipient will benefitfrom the business subsidy or financial assistance. For example, indicate the date improvements were finished, equipment was placed into service, or the, recipient occupied the property, whichever is earlier.) 23. Does the agreement provide a business subsidy or one oftbe four types of financial assistance (see Question 25) required to be reported? (Mark one.) . -business subsidy . -financial assistance 24. If the agreement provided a bu~iness subsidy, please 25. If the assistance was one of the four types of financial indicate the type(s) and total dollar value for each type. assistance. please indicate the type{s). . "I1ot applicable, agreement provided financial assistance . "not applicable, agreement provided a business subsidy . 'loan (only principal) $ . "'aSsistance for property polluted $ . 'gTll111 (i.e., forgivable loan) $ by contaminants . 'tax abatement $ . -assistance for renovating building $ . .TIP or other tax reduction or deferral $ stock or bringing it up to code, and . oguarantee of payment $ assistance provided for designated . 'Contnbution of property or infrastructure $ historic preservation districts, when . "preferential use of governmental facilities $ 50% or less of total cost . -land contribution $ . -assistance for pollution control or $ . 'Otller (SpecitY subsidy rype.) $ abatement . -assistance for a TIF soils condition district $ 26. If the assistance included tax increment financing, please 27. Are any other grantors providing a business subsidy or indicate the type ofTIF district? (Mark one.) financial assistance to the same project? (Mark one.) . -not applicable, assistance was not in the form ofTIF . .y es (Spe~ify each grantor and the value of their assistance below; attach an additional sheet if necessary.) . "fedevelopment . "renewal and renovation . -No . -soils condition . -economic development Grantor(s) and value of the agreement(s): . "lIlined underground space . -hazardous substance subdistrict - Grantor Value ($) Grantor Value ($) Minnesota Business Assjstance Form (1114/04) Page2of4 Dept. of Employment & Economic Development Section 4 Goals and Public Puroose Identified in the A"reement 28. Minn. Stat. ~ 116J.994 requires that business subsidy and financial assistance agreements state a public purpose. Which of the following public purposes were stated in the agreement? (Mark 0/1 that apply.) . 'Enhancing economic diversity . -Creating high-quality job growth . -Job retention . -Stabilizing the community . -Increasing tax base (cannot be only pU1]JOse) . -Other (please specifY) 29. Indicate whether the agreement included the following types of goals, and whether the recipient had attained those goals at the time of this report. (Fill in the boxes and attainment daters) for each goal.) A) Specific wage and job goals to be attained within 2 years B) Other job-creation and/or retention goals C) Other wage goals D) Other goals other than wage andjob goals Goals established? . 'Yes '-No . 'Yes '-No . 'Yes '-No . 'Yes '-No Target attainment dates (month & year) All goals attained? . 'Yes .-No . 'Yes '-No . 'Yes '-N~ . 'Yes '-No (please attach descriptions of goals and progress toward attainment ifnotdocumented in Questions 30 and 31.) 30. For each of the following wage categories, indicate the job creation and/erretentian goals stated in the agreement and the average hourly value of any employer~provided bealth insurance goals for those jobs. (,Onlv indicate job creation goals infUll-time equtvalents if you are unable to separate goals by full- and part-time positions.) FuU-time Part-time! ITE (onlv lfgoals Dot Hourly Wage Job SeasonalfI'emp. stated as Fr/PT) Job Retention Hourly Value of (excluding benefits) Creation Job Creation Job Creation Health Insurance no hourly wage.1eve1 goal - - - - ,_ less than $7.00 - - - - '- $7.00 to $8.99 - - - - '- $9.00 to $10.99 - - - - '- $1 1.00 to $12.99 - - - - '- $13.00 to $14.99 - - - - '- $15.00 and higher - - - - '- 31. For each of the following wage categories, indicate the number of actual jobs created and/or retained since the benefit date and the actual hourly value of any employer-provided health insurance for those jobs. (,Onlv indicate job creation in fit/I-time equivalents if you are unable to separate job creatiqn into full- and part-time positions.) FuU-time Part-time! ITE (onlv If unable to Hourly Wage Job Seasonavremp. separate FTIPT) Job Retention Hourly Value of (excluding benefits) Creation Job Creation Job Creation Health Insurance less than $7.00 - - - - '- $7.00 to $8.99 - - - - '- $9.00 to $10.99 - - - - '- $11.00 to $12.99 - - - - '- $13.00 to $14.99 - - - - '- $15.00 and higher - - - - '- 32. Has the recipient achieved all e:oals (see Questions 29, 30 and 31) and fWfilled aU oblil18tions stipulated in the agreement? (Mark one.) . .Yes . oNo Minnesota Business Assistance Fonn (1/14/04) Page 3 of4 Dept. of Employment & Economic Development ~- - Section 5 Recipients Falling to FuIf'ill Obligations 'Do not complete this section if you comDleted it on another MBAF submitted to DEED.) 33. During the period January 1, 2003 through December 31,2003, did your organization have any recipients who failed to report as required by Minn. Stat. ~116J.993 and ~116J.994? (Mark one.) .. .Yes (Indicate the name of each recipient failing to report and the value of subsidy orfinancial assistance awarded to that recipient. Attach additional pages if necessalY.) . -No Name of recipient Type of subsidy or assistance (See Questions 24 and 25.) Value of subsidy or assistance 34, Did your organization have any recipients who failed to achieve any goals or fulfill any other obligations under an agreement signed on or after August I, 1999, that were required to he fulfilled by the time of this report? (Mark one.) . "Yes (Complete the remainder olthis section.) . -No (Stop here and submit [ann to DEED .) 35. - 39. Provide the following infonnation for each recipient failing to fulfill goals or any other terms of an agreement that were to be attained by the time of reporting. (Attach additional pages if necessary.) 35. Information on recipient and agreement: Name of recipient in default Type of subsidy or assistance Initial value of subsidy or assistance Street address of recipient City/ZIP code of recipient Outstanding value of subsidy or assistance 36. Reason(s) for default (Mal* all that apply.): . 'recipient ceased operation . -recipient relocated to a different community . orecipient was \Ulable to fill vacant positions . 'Other (SpecifY reason.) . 37. To date, has the recipient fulfilled its repayment obligation? (Mark one.) . .Yes . -No, recipient has beron to repay the assistance. . <iN"o, recipient has not be2Ul1 to repay the assistance. 38. Has the agreement been amended to extend the recipient's deadline for fulfilling its obligations? (Mark one.) . .Yes . -No 39. Describe the steps being taken to bring recipient into compliance or recoup the subsidy: Return your completed MBAF(s) by ADrill. 2004. to: Minnesota Business Assistance Form Minnesota Department of Employment and Economic Development - ABO 500 Metro Square, 121 East 7'" Place St. Paul, MN 55101-2146 Or fax to: (651) 215-3841 Minnesota Business Assistance Form (1/14/04) Page 4 of4 Dept. of Employment & Economic Development APPENDIX F REDEVELOPMENT QUALIFICATIONS FOR THE DISTRlCT In May of2005, LHB prepared aReport of Inspection Procedures and Resnlts for Determining Qualifications of a Tax Increment Financing District as a Redevelopment District. This report is being submitted under a separate cover. APPENDIX F-l APPENDIX G BUT/FOR QUALIFICATIONS Current Market Value - Estimate $9,004,800 62.566.355 $53,561,555 18.803.224 $34,758,331 New Market Value - Estimate Difference Present Value of Tax Increment Difference Value Likely to Occur Without TIF is Less Than: $34,758,331 . At the current time, the site has ~ estimated $20 million in land acquisition, demolition and relocation costs. In addition, the site requires from $3.5 million to $5 million for on-site structured parking to accommodate the buyers of the for sale housing. These two factors result in a cost per unit for land that greatly exceeds market conditions. The tax increment is needed to reduce these costs and make them marketable. APPENDIX G-! USES Construction Costs Soft Costs Relocation Sales Commission TOTAL USES Price/Sq. Ft. SOURCES . Condos Retail Sales Parking TIF Non TOTAL SOURCES Profit Profit Percent APPENDIX CITY OF HOPKINS BUT FOR TEST DISTRICT #3 SUMMARY BASED ON THREE DIFFERENT MARKET ANALYSIS High Average High 3yr 3 yr 6yr $60,000,000 $60,000,000 $66,000,000 $28,632,248 $28,632,248 $28,632,248 $2,860,000 $2,860,000 $2,860,000 $4,915,028 $4,669,276 $5;308,230 $96,407,276 $96,161,524 $102,800,478 254.46 232.50 287.51 344,705 2 4,400 100 30,000 89,364,137 $84,895,930 96,513,268 $1,117,600 $1,117,600 $1,117,600 $3,000,000 $3,000,000 $3,000,000 $15,000,000 $19,000,000 $15,000,000 $108,481,737 $108,013,530 $115,630,868 $12,074,461 $11,852,006 $12,830,390 12.52% 12.33% 12.48% 0-2