III. 1. Modification to Tax Increment Financing Plan for Tax Increment Financing District No. 2-11 in Connection with Pooling for Affordable Housing and Incorporation of Special Legislation (HRA2021-08)December 21, 2021 HRA Report 2021-08
MODIFICATION TO TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT
FINANCING DISTRICT NO. 2-11 IN CONNECTION WITH POOLING FOR
AFFORDABLE HOUSING AND INCORPORATION OF SPECIAL LEGISLATION
Proposed Action
Staff recommends adoption of the following motion: Move to approve Resolution 541
Modifying Tax Increment Financing District No. 2-11 in Connection with Pooling for
Affordable Housing and Incorporation of Special Legislation.
With this motion, the TIF District 2-11 plan will be modified.
Overview
During the past State legislative session, cities were given the authority to use an
additional 10% above the existing 25% limit on TIF pooling dollars for affordable
housing. TIF pooling are funds collected from an established District that are used
outside of the District boundaries. The funds can be used for capital costs associated
with rental or owner-occupied housing with terms of affordability determined by the
City/HRA. The proposed action would allow the HRA to use up to 35% TIF pooling
dollars for affordable housing.
The resolution also incorporates special legislation, granted to the Hopkins HRA in 2019
to allow for pooling expenditures for redevelopment activities in addition to housing.
Primary Issues to Consider
This action is administrative. Passing the resolution of support does not obligate the
HRA to spend TIF pooling from District No. 2-11 but allows for it in the future.
Supporting Information
• Resolution 541
___________________________
Kersten Elverum
Director of Planning & Development
Financial Impact: $__0__________Budgeted: Y/N ____ Source: ________________
Related Documents (CIP, ERP, etc.): _________________________________
HOPKINS HOUSING AND REDEVELOPMENT AUTHORITY
CITY OF HOPKINS
HENNEPIN COUNTY
STATE OF MINNESOTA
RESOLUTION NO. 541
RESOLUTION APPROVING A MODIFICATION TO TAX INCREMENT FINANCING PLAN
FOR TAX INCREMENT FINANCING DISTRICT NO. 2-11 IN CONNECTION WITH
POOLING FOR AFFORDABLE HOUSING AND INCORPORATION OF SPECIAL
LEGISLATION
Whereas, the City of Hopkins (the “City”) previously established Redevelopment Project
No. 1 (the “Project Area”) and adopted a Redevelopment Plan therefor, as amended (the
“Redevelopment Plan”). The City and the Hopkins Housing and Redevelopment Authority (the
“Authority”) have also established Tax Increment Financing District 2-11 (the “TIF District”), a
redevelopment TIF District, within the Project Area, and adopted a Tax Increment Financing
Plan for the TIF District (the “TIF Plan”), pursuant to Minnesota Statutes, Sections 469.174 to
469.1794, as amended (the “TIF Act”);
Whereas, in 2019 the Authority and City were granted special legislation, pursuant to the
Laws of Minnesota 2019, First Special Session, Chapter 6, Article 7, Section 1 (the “Special
Legislation”) to allow pooling expenditures for redevelopment in addition to housing.
Whereas, in connection with making an election to authorize certain expenditures for
affordable housing pursuant to Section 469.1763, Subdivision 2(d) of the TIF Act and to
reference the Special Legislation, the Authority desires to amend the TIF Plan for the TIF
District to provide for administrative changes to the budgets set forth therein (the
“Amendments”).
Whereas, the Amendments do not increase the total estimated tax increment
expenditures, amount of bonded indebtedness, or capitalized interest, or make any other changes
that would require a new public hearing pursuant to Section 469.175, subd. 4 of the TIF Act.
Now, therefore, be it resolved as follows:
1. Findings for the Adoption of the Amendments. The Board of Commissioners
finds that the Amendments are intended to carry out the objectives of the Redevelopment Plan
for the Project Area, to create an impetus for the construction of decent, safe and sanitary
housing for persons of low and moderate income by better utilizing blighted, polluted and
underutilized land and enhancing the tax base of the City, and to otherwise promote certain
public purposes and accomplish certain objectives as specified in the Redevelopment Plan, as
modified, and in the Amendments.
The Board of Commissioners hereby ratifies and confirms the findings made in
connection with the establishment of the TIF District.
2. Election to Authorize Certain Expenditures for Affordable Housing. In
accordance with Section 469.1763, Subdivision 2(d) of the TIF Act, the City and Authority may
elect to increase by up to 10% the permitted amount of expenditures for activities located outside
the geographic area of any tax increment financing district. The Board of Commissioners hereby
elects to authorize utilizing up to 35% of the tax increment from the TIF District, less any
amount utilized for administrative expenses, for such housing expenditures as set forth in the
Amendments. A summary of the modified intended uses for the TIF District is attached as
Exhibit A.
3. Approval of the Amendments. The Amendments are hereby approved in
substantially the form presented to the Authority and on file in the office of the Director of
Planning and Development. Authority staff, advisors and legal counsel are authorized and
directed to proceed with the implementation of the Amendments. Authority staff is hereby
directed to file a copy of this resolution and the Amendments with the Taxpayer Services
Division of Hennepin County, the Office of the State Auditor and the Commissioner of Revenue.
Approved by the Board of Commissioners of the Hopkins Housing and Redevelopment
Authority this 21st day of December, 2021
___________________________________
Jason Gadd, HRA Board Chair
Attest:
Michael Mornson, Executive Director
Exhibit A
City of Hopkins
TIF District 2-11
TIF Plan Budget Summary
Original Amendment No. 1 Amendment No. 2 Amendment No. 3
October 6, 1998 November 20, 2001 November 7, 2012 December 21, 2021
SOURCES
Tax Increment 34,300,000 70,115,000 68,000,000 68,000,000
Local Contribution 1,715,000 1,715,000 - -
Interest - - 1,000,000 1,000,000
TOTAL 36,015,000 70,115,000 69,000,000 69,000,000
USES
Land/Building Acquisition 5,210,000 10,210,000 16,050,000 16,050,000
Site Improvements/Preparation 5,210,000 7,610,000 20,000,000 20,000,000
Construction of Affordable Housing - - - 6,900,000
Public Utilties 4,474,000 4,474,000 1,000,000 1,000,000
Other Qualifying Activities - 9,500,000 12,000,000 5,100,000
Administrative Costs (up to 10%)3,521,000 8,521,000 3,450,000 3,450,000
PROJECT COSTS TOTAL 18,415,000 40,315,000 52,500,000 52,500,000
Interest 17,600,000 29,800,000 16,500,000 16,500,000
PROJECT AND INTEREST COSTS TOTAL 36,015,000 70,115,000 69,000,000 69,000,000