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CR 95-54 PH TIF Dist 1-2 \ y \ 0 {j -<- ~ March 20, 1995 ,y '" Council Report 95-54 o " '" e K \ PUBLIC HEARING CONCERNING ESTABLISHMENT OF TIF DISTRICT 1-2 AND MODIFICATION OF BUDGETS FOR TIF DISTRICTS 1-1 AND 2-1 Pro Dosed Action. Staff recommends approval of the following motion. Move to approve Resolution 95-22 modifying the redevelopment plan for Redevelopment Proiect No. 1. establishing Tax Increment Financing District No. 1-2. modifying Tax Increment Financing District No.1-I. modifying Tax Increment Financing District No.2-I. and approving and adopting the Tax Increment Financing Plans related thereto, located within Redevelopment Proiect No.1. Overview. Staff is proposing action relative to two of the City's existing tax increment districts, as well as the creation of a new tax increment district within the central business district. The specific action proposed involves the following. . Amendment of budgets for Tax Increment Financing District 1-1 and 2-1. This action is basically a "housekeeping It activity to address the following. . Remove activities which have been completed or are anticipated not to be undertaken, . Revise budget costs of certain activities to better reflect either actual cost or current estimates. . Addition of activities which are being contemplated by the City Council/HRA. . Creation of a new tax increment district entitled Tax Increment Financing District 1-2. This . district is proposed to encompass the property of the former Suburban Chevrolet operation. The property is presently located in Tax Increment District 1-1 and would be removed from that district. TIF District 1-2 would allow for the collection of tax increments for a longer period of time to provide an additional source offunds for the payment of public costs in conjunction with the redevelopment of this site. To accomplish the above actions, the public hearing has been scheduled for April 4. The Zoning and Planning Commission has approved Resolution No. RZ95-8 finding the various TIP plans are consistent with the Comprehensive Plan. Primary Issues to Consider. 0 What are the specifics ofthe action being requested? 0 What is the purpose of this action? 0 What are the impacts of this action? SUDDortine: Documents. 0 Resolution 95-22. 0 Modified Redevelopment Plan for Redevelopment Project No. 1 and the Tax Increment Financing Plan for Tax Increment Financing District 1-2. 0 Modifications to Tax Increment Financing Plan for Tax Increment Financing District 1-1. 0 Modifications to Tax Increment Financing Plan for Tax Increment Financing District 2-1. . 0 Summary of budget changes. 0 Revenue/Expenditures Projection. o QU€istR}n? Answer Summary. , / - '",,:: /L-e ~~ n...;.:.... ;' .- '( Jim ~~rrigan, Dire tor Planning & Economic Development - -- Primary Issues to Consider. e 0 What are the specifics of the action being requested? Staffis requesting action which will involve three different elements. Two of these elements are housekeeping activities relating to the budgets of existing Tax Increment Districts 1-1 and 2-1. In asking for approval of these changes, it needs to be emphasized that such action will not allow for either of the following. . Extend the time period for which tax increments are collected. . Allow for the collection of more tax increments than would be collected if this action did not occur. The second element of the proposed action involves the creation of a new tax increment district, 1-2. With this action, staff is proposing to decertify the former Suburban Chevrolet property from Tax Increment District 1-1 and place it within a new district to generate tax increment dollars to offset public costs in conjunction with redevelopment of this property. 0 What is the purpose of this action? As stated above, the budget revisions to Districts 1-1 and 2-1 are basically housekeeping activities. This type of action is done from time to time in an attempt to keep the budget as current as possible. These budget changes would revise the budgets as previously e approved in 1989. The creation of Tax Increment District 1-2 is being proposed to provide an additional source of funds for the redevelopment of the Suburban Chevrolet property. Attached is a sheet prepared by Staff which details expenditures/revenue projections for both Tax Increment Financing Districts 1-1 and 1-2. As previously noted, there is a revenue shortfall to complete all of these proposed activities. However, the placement of the Suburban Chevrolet property in a new tax increment district will allow for an additional revenue source to help close this "gap. n 0 What is the impact in tax of this action? The only element ofthe action which is being proposed that has any impact from a financial perspective on the City of Hopkins, Hennepin County, or the school district relates to the creation of Tax Increment District 1-2. This impact relates to the fact that if this change was not approved, the Suburban Chevrolet property, as part ofTIF District I-I, would go back on the tax rolls in the year 2010. However, by placing the property in a new tax increment district, it would not be back on the tax rolls until the year 2021. It needs to be emphasized, however, that this impact is really very minimal to the various taxing jurisdictions for the following reasons. tit . The current frozen base of the Suburban Chevrolet property, which provides a number to calculate distribution of property taxes to the various taxing jurisdictions, is approximately $26,000. By placing this property in a new tax increment district, the frozen base will be increased to the current value of the property, which as a result will increase the frozen base to approximately $55,000. In essence, with this action, from 1996 through the year 2009, approximately double the amount of property taxes will be - - - ----.. --..- paid each year to the various taxing jurisdictions, as opposed to keeping this property in . the current TIF District 1-1. . In conjunction with the creation of Tax Increment District 1-2, the City would experience a penalty to its LGAlHACA payment that it receives each year. The penalty would be a fairly minimal percentage of the tax increment generated in the early years of the district and would increase in the latter years. The purpose of this reduction is to offset the reduction in school funding which might have occurred due to the fact that this property is in a tax increment district. In theory, the State uses the dollars which are no longer being provided to the City (the LGA) to make up for any potential losses felt by the school district due to creation of a new district. It is also appropriate to point out that the creation of a new tax increment district has additional positive benefits to the various taxing jurisdictions. . By undertaking the redevelopment of the Suburban Chevrolet property, property taxes will increase substantially over what they would if no redevelopment occurred. When the proposed theater/restaurant project is placed on the tax rolls, based on today's dollars, there will be an increase of approximately $100,000 in property taxes over what is currently being paid. . Tax increment dollars generated from Tax Increment District 1-2 are also being contemplated to be used in assisting in the construction of a possible arts facility. It is anticipated that ifhoth the theatre/restaurant and arts facility are constructed in the . downtown, they could bring upwards of 500,000 people into the downtown annually. These people would be customers for the various businesses in the downtown and thus improve the overall economic vitality of this area, which in turn would increase property values. . By completing redevelopment of both the Suburban Chevrolet site and the other economic development project contemplated for the downtown, it is anticipated that other private development activities within both the downtown and the City as a whole will be encouraged, which will potentially add a substantial amount to the City's tax base. Alternatives. The City Council has the following alternatives regarding this matter. 1. Approve the action as recommended by Staff Under this action, the Council would approve both budget amendments and the creation of the new tax increment district. 2. Continue for additional information. It is not imperative that the action be approved at the April 4 meeting. 3. Deny the application as requested by Staff. The impact of this action will be as follows. . Reduce the amount of revenue for undertaking future activities in Districts 2-1 and 1-1. . Remove the possibility of undertaking certain activities which have been previously e discussed by the City Council, such as the theaterlrestaurant and arts facility. 4. Approve only a portion of the action as recommended by Staff, i.e., either the budget revision for Districts 1-1 or 2-1, or the new Tax Increment District I~2. RESOLUTION NO. 95-22 . CITY OF HOPKINS COUNTY OF HENNEPIN STATE OF MINNESOTA RESOLUTION MODIFYING THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO.1, ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 1-2, MODIFYING TAX INCREMENT FINANCING DISTRICT NO.1-I, AND MODIFYING TAX INCREMENT FINANCING DISTRICT NO.2-I, AND APPROVING AND ADOPTING THE TAX INCREMENT FINANCING PLANS RELATED THERETO, LOCA TED WITHIN REDEVELOPMENT PROJECT NO.1. BE IT RESOLVED by the City Council (the "Council") of the City of Hopkins, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01. It has been proposed that the City modify the Redevelopment Plan for Redevelopment Project No. 1, establish Tax Increment Financing District No. 1-2, modify Tax Increment Financing District No.1-I, and modify Tax Increment Financing District No. 2-1, and and approve and adopt the Tax Increment Financing Plans relating thereto, located within Redevelopment Project No.1, all pursuant to and in accordance with Minnesota Statutes, Sections 469.001 through 469.047, inclusive; and Minnesota Statutes, Sections 469.174 through 469.179, . inclusive; and 1.02. The Council has investigated the facts and has caused to be prepared a Modified Redevelopment Plan for Redevelopment Project No.1, the proposed Tax Increment Financing Plan for Tax Increment Financing District No. 1-2, a modified Tax Increment Financing Plan for Tax Increment Financing District No.1-I, and a modified Tax Increment Financing Plan for Tax Increment Financing District No. 2-1 (the "Plans"). 1.03. The City has performed all actions required by law to be performed prior to the modification of Redevelopment Project No.1, the establishment of Tax Increment Financing District No. 1-2, the modification of Tax Increment Financing District No.1-I, and the modification of Tax Increment Financing District No.2-I, and the adoption of the Plans relating thereto, including, but not limited to, notification of Hennepin County and School Districts No. 270 having taxing jurisdiction over the property to be included in Tax Increment Financing District No. 1-2, Tax Increment Financing District No.1-I, and Tax Increment Financing District No.2-I, a review by the City Planning Commission of the proposed Plans and the holding of a public hearing upon published notice as required by law. Section 2. Findings for the Modification of the Redevelopment Plan for Redevelopment Proiect No. L the Establishment of Tax Increment Financ.;ing District No. 1-2. the Modification of Tax Increment Financing District No. 1- L and the Modification of Tax Increment Financing District No. 2- L and the Approval of the Tax Increment Financing Plans relating thereto. 2.01. The Council hereby finds that Tax Increment Financing District No. 1-2 is a redevelopment district. e N :IWPDA T AIPI :Hl.!CO RIHOPK INS\TIFI-2\CITYCOU'tRES 2.02. The Council hereby finds that the modification of the Redevelopment Plan for Redevelopment . Project No.1, the establishment of Tax Increment Financing District No. 1-2, the modification of Tax Increment Financing District No. 1-1, and the modification of Tax Increment Financing District 2-1, and the approval of the Tax Increment Financing Plans relating thereto, are intended and, in the judgement of this Council, the effect of such actions will be, to provide an impetus for redevelopment in the public purposes and accomplish certain objectives as specified in the Plans. 2.03. The Council further finds that the proposed development, in the opinion of the Council, would not occur solely through private investment within the reasonably foreseeable future and, therefore, the use of tax increment financing is deemed necessary; 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 of Tax Increment Financing District No. 1-2 by pri vate enterprise. 2.04. The Council further finds, declares and determines that the City has made the above findings stated in Section 2 and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Attachment A. Section 3. Approval of the Plans. 3.0l. The modifications to the Redevelopment Plan for Redevelopment Project No. L the establishment of the Tax Increment Financing Plan for Tax Increment Financing District No. 1-2, the modification of the Tax Increment Financing Plan for Tax Increment Financing District No.1-I, and the modification of the Tax Increment Financing Plan for Tax Increment Financing District No.2-I, are hereby approved and adopted, and shall be placed on file in the office of the City Manager. . 3.02. 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 for this purposed to negotiate, draft, prepare and present to thjs Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. The motion for the adoption of the foregoing resolution was duly seconded by Councilmember , and upon a vote being taken thereon, the following voted in favor thereof: and the following voted against the same: Dated: April _, 1995 Mayor ATTEST: Clerk (Seal) -- N :\WPDA T AIPl'BLlCORIHOPKINSITIFl-2\CITYCOUN .RES . ATTACHMENT A RESOLUTION #95-22 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plans for Tax Increment Financing Districts Nos. 1-2, 1-1, and 2-1 as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that Tax Increment Financing District No. 1-2 is a redevelopment district as defined in Minnesota Statutes, Section 469.175, Subd. 10. District No. 1-2 consists of 9 parcels of land and adjacent and internal rights-of-way The District qualifies as a redevelopment district as defined in Minnesota Statutes, section 469.] 74, subd. 10. The Authority has demolished the substandard buildings located on the parcels included within the District. However, prior to demolishing the buildings and improvements, the Authority found by resolution that the parcels were occupied by a structurally substandard building and that it intended to include the parcels in a tax increment district. The Authority elects to treat the property in the District as being occupied by the demolished structurally substandard building as permitted by section 469.174, subd. 10. The facts on which the Authority based its finding is found in Exhibit C in the Tax Increment Financing Plan for Tax Increment Financing District No. 1-2. Tax Increment Financing District No. 1-1 and Tax Increment Financing District No. 2-1 are existing tax increment financing districts. The proposed modifications to Tax Increment Financing Districts Nos. 1-1 and 2-1 involve changes in the project budgets and clarification of project activities. The proposed modifications do not change the . qualification under the Tax Increment Financing Act, Minnesota Statutes, Sections 469.174 through 469.179. 2. Finding that the proposed development, in the opinion of the Council, would not occur solely through private investment within the reasonably foreseeable future and, therefore, the use of tax increment financing is deemed necessary. Due to the high cost of redevelopment on parcels currently occupied by substandard buildings and the cost of financing the proposed improvements, the projects contemplated in the Plans are feasible only through assistance, in part, from tax increment financing. This analysis is based on city and staff analysis of property within the districts.. 3. Finding that the Tax Increment Financing Plans confonn to the general plan for the development or redevelopment of the municipality as a whole. The site is appropriately zoned. The Tax Increment Financing Plans for Tax Increment Financing District No. 1-2, Tax Increment Financing District No. 1-1 and Tax Increment Financing District No. 2-1 have been reviewed by the Planning Commission and been found to conform to the general development plan of the City. 4. Finding that the Tax Increme1ll Financing Plans wi!! afford maximum oppot1unity, consistent with the sound needs of the City as a whale, for the development of Redevelopment Project NO.1 by private enterprise. The establishment of Tax Increment Financing District No. 1-2 and the modifications of Tax Increment Financing Districts Nos. 1-1 and 2-1 will result in the facilitation of development and redevelopment in the City. e N:\WPOA T A\PlI BLlCOR\HOPK INS\TI FI-2\CITYCOCr-;.RES ... . Modified Redevelopment Plan for Redevelopment Project No.1 and the Tax Increment Financing Plan for Tax Increment Financing District No. 1-2 (A Redevelopment District) . Housing and Redevelopment Authority in and for the City of Hopkins Hennepin County City of Hopkins, Minnesota Prepared: March 1, 1995 Revised: March 20, 1995 Adopted: Apri14, 1995 Prepared by: PUBLICORP, lNC. in association with EHLERS AND ASSOCIA rES, INe. 2950 NOfW"est Center 90 South Seventh Street Minneapolis, MN 55402-4100 (612) 339-8291 . -- .. ;. TABLE OF CONTENTS . (This Table of Contents is not part of the Redevelopment Plan and is only for convenience of reference.) REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1 Section 1. Definition .......................................................... 1-1 Section 2. Background. . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-2 Section 3. Modification Intent ................................................... 1-2 Section 4. Public Purpose . . . . . . . 4 . . . . . . ~ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . 1-2 Exhibit l-A-l Map of Project. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-3 TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRlCT NO. 1-2 Section A. Statutory Authority ..................................................... 1 Section B. Statement of Objectives. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 1 Section C. Redevelopment Plan Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _ 2 Section D. Description of Property in District No. 1-2 ................................... 2 Section E. Classification of the Tax Increment Financing District ...................... . . . . 3 Section F. Property To Be Acquired ................................................ 4 Section G. Estimate of Costs ...................................................... 4 Section H. Estimated Amount of LoanIBonded Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 1. Sources of Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 5 Section 1. Original Tax Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 5 . Section K. Amount of Captured Tax Capacity ......................................... 5 Section L. Duration of the District . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 6 Section M. Estimated Impact on Other Taxing Jurisdictions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section N. Modifications of the Tax Increment Financing District . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section O. Administrative Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 7 Section P. Duration of Tax Increment Financing Districts ................................ 7 Section Q. Limitation on Qualification of Property in Tax Increment District Not Subject to Improvement .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 7 Section R. Limitation on the Use of Tax Increment ..................................... 8 Section S. Notification of Prior Planned Improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 8 Section T. Excess Tax Increments .................................................. 9 Section U. Requirement for Agreements with the Developer .............................. 9 Section V. Assessment Agreements ................................................. 9 Section W. Administration of District and Maintenance of the Tax Increment Account ......... 10 Section X. Financial Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 10 Section Y. Municipal Approval ................................................... 10 Section Z. County Road Costs .................................................... 11 Section AA. Reduction in State Tax Increment Financing Aid ............................. 11 EXHIBIT A Boundary Map of Tax Increment Financing District No. 1-2 ....... ........... . A-I EXHIBIT B Cashflow Analysis and Base Value Analysis . . . . .. . . . . . . . . . . . .. . . ....... . . . B-1 EXHIBIT C Data on Qualifications as a Redevelopment Tax Increment Financing District . . . . . . C-I . REDEVELOPMENT PLAN . FOR REDEVELOPMENT PROJECT NO.1 Section 1. Definitions. The tenns defmed below, for purposes of this Redevelopment Plan have the meanings herein specified, unless the context otherwise specifically requires: "Authority" means the Housing and Redevelopment Authority in and for the City of Hopkins, a public body corporate and politic created by the City of Hopkins pursuant to the HRA. Act. "City" means the City of Hopkins, Minnesota. "City Council" means the City Council of the City of Hopkins, Minnesota, also referred to as the governing body. "Comprehensive Plan" means the City's Comprehensive Plan which contains the objectives, policies, standards and programs to guide public and private land use, development, redevelopment, and preservation of all lands and water within the City. "County" means the County of Hennepin, Minnesota. "County Board" means the County Board of Hennepin County, Minnesota. "HRA Act" means Minnesota Statutes, Sections 469.001 to 469.047, inclusive, as amended. . "Municipality" means any city, however organized as defined in Minnesota Statutes, Section 469.125, Subdivision 2. "Project Area" means the Redevelopment Project as geographically described in Section 1, Section 1.9 of the Redevelopment Plan. "Project Plan" means the Redevelopment Plan for the Project Area. "State" means the State of Minnesota. "Tax Increment Financing Act" means the statutory provisions of Minnesota Statutes, Sections 469.174 through 469.179, inclusive, as amended. "Tax Increment Bonds" or ''TIP Bonds" means any general obligation or revenue tax increment bonds issued and to be issued by the City to fmance the public costs associated with Redevelopment Project No. I as stated in the Redevelopment Plan and in the Tax Increment Financing Plan as a Tax Increment Financing District within Redevelopment Project No.1. The tenn "Tax Increment Bonds" shall also include any obligations issued to refund the Tax Increment Bonds. "Tax Increment Financing District" or ;lIF District" means any tax increment financing district presently established or to be established in the future in Redevelopment Project No.1. "Tax Increment Financing Plan" means the respective Tax Increment Plan or each Ta."( Increment Financing District presently located or to be located int he future within the Redevelopment Project. . I-I - , . Section 2. Back2:round The City of Hopklns ("City") land City of Hopkins Housing and Redevelopment Authority (the "Authority") on November 7, 1989 reorganized and modified its Redevelopment Project Area in a document entitled "Reorganization and Modification of Redevelopment Projects and Tax Increment Districts (including Tax Increment Financing Plan for Tax Increment Financing District No. 2.2)." That document is included in this modification by reference. In October 1992, the City and the Authority expanded the boundaries of Redevelopment Project No.1 to include Redevelopment Project No.2 and additional areas. The purposed to he expansion was to pennit a more efficient allocation of revenues from tax increment financing districts within the expanded Project Area. The modified Project Plan approved in October 1992 is also incorporated herein by reference. Section 3. Modification Intent Within the Project Area, the Authority and the City intend to de-certify certain parcels originally included in TIF District No.1-I. These parcels will be re-certified as TIF District No. 1-2, a redevelopment district. This action is intended to accomplish the overall objectives of the Project Plan, as more specifically described in the Tax Increment Financing Plan for Tax Increment Financing District No. 1-2. Section 4. Public Purpose The objectives as stated in the originally Project Plan and subsequently approved modifications remain unchanged. The City and the Authority continue to seek to expand the supply of affordable housing in . Hopklns while seeking to promote redevelopment, economic diversity and growth. . 1-2 . - EXHIBIT I-A-I. MAP OF PROJECT . . . 1-3 - -.- ---- :i' o"(~ ~ S C\\i l\~ \\~ If\\~ \)'I\"'t"1 "\ S' CO ,.cO "'\~~ ~O~ ",-e.'I\'I\ ,'C>" ~ ,,,0 \ .' .....'i' G\\' U~ GO O~' gtt.') 0'< 0~~ "'\ 9 x:-O o\; tt.O. 55 ~5 X:.~ {) (S)~ ~o6 . G 0 ~'. "~:~. \J:.. -;:"~;2: ~,:r~.. .:." ". ;:>1. '-:,;~.> .;:~~ - '..,.#. ';..;", . .'~.: - . T AX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 1-2 A. STATUTORY AUTHORITY Within the City of Hopkins (the "City") there exist areas where public involvement is necessary to cause development or redevelopment to occur. To this end, the City Council established the Hopkins Housing and Redevelopment Authority (the "Authority"). The City faces various existing land use problems that require corrective action by the City or Authority before development by private enterprise becomes financially feasible or desirable. The Authority and City are authorized to establish a tax increment district pursuant to Minnesota Statutes, Section 469.174 to 469.179, inclusive, as amended, to assist in financing public costs related to this project. Tax increments are derived only from the increased amount of taxes which are paid on a parcel of property after the construction of a new structure on the parcel. Tax increment districts encompass the parcels from which tax increments are paid for a period of time. Below is the Tax Increment Financing Plan (the "PIan") for Tax Increment Financing District No. 1-2 ("District No. 1-2"). Other relevant information is contained in the Redevelopment Plan for Redevelopment Project No.1, originally adopted on June 30, 1970 and subsequently modified. A modification of the Redevelopment Plan is contemplated in the Tax Increment Plan. Redevelopment Project No.1 includes the area proposed for District No. 1-2. The Authority or the City reserves the right to approve all or a portion of the property proposed to be included in District No. 1-2 on the date of the first public hearing, April 4, 1995. . B. ST A TEMENT OF OBJECTIVES District No. 1-2 consists of 9 parcels ofland and adjacent and internal rights-of-way. Plans for the new development on the site include destination retail and may include a housing component. The current plans for the new development on the site include an arts facility, an approximately 7,000 square foot restaurant and a 30,000 square foot theater complex. District No. 1-2 is expected to achieve many of thc objectives set forth in the Redevelopment Plan in regard to land use. These objectives include: 1. Promote and secure the prompt development of property in Redevelopment Project No.1 in a manner consistent with the Comprehensive Plan and with minimal adverse impact on the environment, which property is currently blighted because of obsolescence, dilapidation, deleterious land use, and other factors related to the safety, health, morals and welfare of the City; 2. Promote and secure additional employment opportunities within Redevelopment Project No. 1 and the City for residents of the City and the surrounding area, thereby improving living standards and preventing unemployment and the loss of skilled labor and other human resources in the City; . 1 ..---- ....-".- ---------- -.---- ---..-- --..- -- -- ..-- ---. .-.-------.-- ---- 3. Secure the increase of property subject to taxation by the City, county, school district,' and . other taxing jurisdictions in order to better enable such entities to pay for public improvements and governmental services and programs required to be provided by them; 4. Secure the construction and provide funds for the payment of the cost of public activities or improvements in Redevelopment Project No. I, which are necessary for the orderly and beneficial development of the District; 5. Promote the concentration of appropriate development within Redevelopment Project No. 1 in order to maintain the area in a manner compatible with its accessibility and prominence in the City; 6. Encourage local business expansion, improvement, development and redevelopment, when compatible with the Redevelopment Project Plan; and 7. Create a desirable and unique character within Redevelopment Project No.1 through quality land use alternatives and design in new and renovated buildings. See Exhibit C for the data on the qualifications of the redevelopment tax increment financing district. C. REDEVELOPMENT PLAN OVERVIEW 1. Property to be Acquired - Selected property located within District No. 1-2 has been acquired by the City or the Authority and is further described in Subsection F of this Plan. . 2. Relocation - Complete relocation services are available pursuant to Minnesota Statutes, Chapter 117 and other relevant state and federal laws. 3. D pon approval of the developer's plan relating to the project and completion of the necessary legal requirements, the Cicy or the Authority may sell to the developer selected properties it may acquire within District No. 1-2. 4. The City or the Authority may perform or provide for some or all necessary relocation, demolition, and required utilities and public streets work within District No. 1-2. 5. District No. 1-2 contains property zoned commerciaVindustrial. All development in the area will conform to applicable state and local codes and ordinances. D. DESCRlPTION OF PROPERTY IN DISTRlCT NO. 1-2 District No. 1-2 encompasses the parcels and all adjacent and interior right-of-ways as identified below: 24-117 - 22- 34-0061 24-117-22-31-0048 24-117-22-34-0063 24-117-22-31-0058 24-117-22-34-0077 24-117-22-31-0059 24-117-22-31-0046 24-117-22-31-0060 24-117-22-31-0047 . 2 --- The City or the Authority reserves a right to approve all or a portion of the area of the parcels list~d as e des ignation for District No. 1- 2. See the map in Exhibit A for further infol111ation on the location of District No. 1-2. E. CLASSIFICATION OF THE TAX INCREMENT FINANCING DISTRICT The City and the Authority, in detennining the need to create a tax increment fmancing district in accordance with Minnesota Statutes, Section 469.174 to 469.179, as amended, inclusive, fmds that District No. 1-2 to be established is a redevelopment district pursuant to Minnesota Statutes, Section 469.174, Subdivision 10 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 that one 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, or other improvements and more than 50 percent of the buildings, not including outbuildings, are stn/cturalIy substandard to a degree requiring substantial renovation or clearance; or (2) The property consists of vacant, unused, undernsed, inappropriately used, or infrequently used Tailyards, rail storage facilities or excessive or vacated railroad rights-of-way. (b) For purposes of this subdivision, "structurally substandard" shall mean containing defects in . strnctural elements or a combination of deficiencies in essential utilities and facilities, 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. A building is not structurally substandard if it is in compliance with the btlilding 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 squarefootage 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 structural repairs or other similar reliable evidence. If the evidence supports a reasonable conclusion that the building is not disqualified as structurally substandard, the municipality may make such a determination without an interior inspection or an independent, expert appraisal of the cost of repair and rehabilitation of the building... (c) For purposes of this subdi\'ision, a parcel is not occtlpied by buildings, streets, utilities or other improvemenrs until 15 percent of the area of the parcel contains improvements. The 9 parcels have been investigated by City and Authority staff and consultants and District No. 1-2 has been found to meet all requirements of a redevelopment district. A complete report of the fmdings is located in Exhibit C of the Plan. District No. 1-2 is created pursuant to the Tax Increment Financing Act. . 3 F. PROPERTY TO BE ACOUIRED e The City or Authority has acquired all parcels within District No. 1-2. G. ESTIMATE OF COSTS The estimate of public costs associated with District No. 1-2 are outlined in the following line item budget: Estimate of Public Costs Qualified Costs - Suburban Chevrolet Site Land Acquisition, Demolition, and Other Development Costs $4,000,000 Arts Facility 1.500.000 Total Estimated Public Costs: $5,500,000 Capitalized interest and other interest payments on tax increment bonds and obligations are also considered to be public costs in addition to the above referenced estimate of public costs. Interest payments and capitalized interest will be determined at the time of issuance of the bonds and obligations and are dependent on interest rates in effect at such time. In addition, administration costs to cover city staff and overhead and various consulting fees in an amount not to exceed 10% of total tax increment will be funded with tax increments from District No. 1-2 in addition to above mentioned costs. e To the extent tax increment from District No. 1-2 in any year exceeds the amount necessary to finance activities undertaken in accord with this Plan (including TIF Bond debt service and any other commitments, the Authority may contribute such excess to the City's commercial rehabilitation loan fund, the City's landscape loan/grant fund, the City's sign rehabilitation loan fund, or all three. Contribution to any of these funds will be placed in an account maintained for loans used exclusively within Redevelopment Project No. 1. Any funds to be expended outside the boundaries of District No. 1-2, but within the boundaries of Redevelopment Project No.1, will be less than 25 percent of total tax increment generated by District No. 1-2, including administrative costs. Subject to that limitation, and the limitations as described in Section R. the tax increment from District No. 1-2 may be used to pay for public costs outlined in budgets for Tax Increment Financing Districts No. 1-1 and 2-1 (whether or not such expenditures exceed the total budget for this plan identified above). Tax increments from Tax Increment Financing District No. 1-1 and 2-1 may also be used to pay for costs associated with public costs outlined in this Plan. H. ESTIMATED AMOUNT OF LOAt~IBONDED INDEBTEDNESS It is anticipated that the City or Authority may issue a revenue bond, general obligation bond, or other type of obligation in one or more series to finance any or all of the total estimated Public Costs authorized to be paid under Section G of this Plan. . 4 , 1. SOURCES OF REVENUE e The major source of revenue to be used to fmance public costs associated with the public development projects in Redevelopment Project No.1 is tax increment generated as a result of the taxation of the land and improvements in District No. 1-2, but may also include tax increments from District No. 1-1 and District No. 2-I. Tax increment fmancing refers to a funding technique that utilizes increases in valuation and the property taxes attributable to new development to finance, or assist in the financing of public development costs. Additional sources of revenue may include but are not limited to investment income and land sales proceeds. This does not preclude the City, the Authority, or the developer from using other funds, at its discretion, to pay such costs. J. ORIGINAL TAX CAPACITY Pursuant to Minnesota Statutes Section 469.174, Subdivision 7 and Section 469.177, Subdivision 1, the Original Net Tax Capacity (OTC) for the District No. 1-2 is based on the value placed on the property by the assessor in 1994 for taxes payable 1995. The tax capacity as certified and when the new construction is completed is estimated to be 55,321 for taxes payable in 1995. The original local tax rate for District No. 1-2 will be the tax rate for taxes payable in 1995 of 146.572%. Each year, the Hennepin County Department of Property Tax and Public Records will measure the amount of increase or decrease in the total tax capacity of District No. 1-2 to calculate the tax increment payable to the City and the Authority. In any year in which there is an increase in total tax capacity in the tax increment financing district above the annual percentage of annual increase, a tax increment will be payable. In any e year in which the total tax capacity in District No. 1-2 declines below the original tax capacity, no additional valuation will be captured and no tax increment will be payable. The County Auditor shall certify in each year after the date the OTC was certified, the amount the OTC has increased or decreased as a result of: I. change in tax exempt status of property; 2. reduction or enlargement of the geographic boundaries of the district; 3. change due to stipulations, adjustments, negotiated or court-ordered abatements; 4. change in the use of the property and classification; or 5. change in state law governing class rates. K. AMOUNT OF CAPTURED TAX CAPACITY Pursuant to Minnesota Statutes, Section 469.174 Subdivision 4 and Minnesota Statutes, Section 469.177, Subdivision 2, the estimated Captured Net Tax Capacity (CTC) of District No. 1-2, upon completion of all phases of the project, will annually approximate 68,748. The City requests 100 percent of the available increase in tax capacity for repayment of debt and current expenditures. The original tax capacity and project tax capacity are estimated at current market values and class rates to be the total amount when all development is in place and uses of the property have changed. Estimated Project Tax Capacity 124,069 less Original Tax Capacity 55,321 Estimated Captured Tax Capacity 68,748 . 5 -- -- - e L. DURA TION OF THE DISTRICT Pursuant to Minnesota Statutes, Section 469.175, Subdivision 1, the duration of District No. 1-2 must be indicated within the Plan. The duration of District No. 1-2 will be 25 years from payment of the first tax increment expected in 1997. Thus, it is estimated that District No. 1-2, including any modifications of the Plan for subsequent phases or other changes, would terminate at the end of the year 2021. The City and the Authority reserve the right to decertify District No. 1-2 prior to the legally required date. M. ESTIMATED IMP ACT ON OTHER TAXING JURISDICTIONS The estimated impact on other taxing jurisdictions assumes construction would have occurred without the creation of District No. 1-2. If the construction is a result of tax. increment financing, the impact is $0 to other entities. Notwithstanding the fact that the fiscal impact on the other taxing jurisdictions is $0 due to the fact that the construction would not have occurred without the assistance of the city, the following estimated impact of District No. 1-2 would be as follows if the "but for" test was not met: IMPACT ON TAX BASE ENTITY'S % OF CAPTURED TOT AL NET CAPTURED T AX CAPACITY ENTITY TAX CAPACITY TAX CAPACITY TO ENTITY TOTAL Hennepin County 966,907,816 68,748 .007% e City of Hopkins 14,603,004 68,748 .471 % School District No. 270 75.703,256 68,748 .091% IMPACT ON TAX RATES CURRENT CAPTURED POTENTIAL ENTITY TAX RATE TAX CAPACITY TAXES Hennepin County .37454 68,748 25,749 City of Hopkins .27191 68,748 18,693 School District No. 270' .75076 68,748 51,613 Metropolitan Special Districts .04453 68,748 3,061 Other Special Districts .02398 68,748 1,649 TOTAL 1.46572 100,765 The estimates listed above display captured tax capacity when all construction is completed. The tax rates and tax capacities are the payable 1995 figures for all jurisdictions. District No. 1-2 will be certified under rates for tax year payable 1995. In addition, the impacts on School District No. 270 do not include the effect of state aids for education upon school district funding. . 6 , . N. MODIFICATIONS OF THE TAX IN"CREMENT FINANCIN"G DISTRICT . In accordance with Minnesota Statutes, Section 469.175, Subdivision 4, any reduction or enlargement of the geographic area of the project or tax increment financing district, increase in amount of bonded indebtedness to be incurred, including a determination to capitalize interest on debt if that determination was not a part of the original plan, or to increase or decrease the amount of interest on the debt to be capitalized, increase in the portion of the captured tax capacity to be retained by the City or Authority, increase in total estimated tax increment expenditures or designation of additional property to be acquired by the City or Authority shall be approved upon the notice and after the discussion, public hearing and findings required for approval of the original plan. The geographic area of a tax increment financing district may be reduced, but shall not be enlarged after five years following the date of certification of the original tax capacity by the county auditor or by approximately April, 2000. Modifications to the District No. 1-2, in the form of a budget modification or an expansion of the boundaries, will be recorded in this Plan. O. LIMITATION ON ADMINISTRATIVE EXPENSES In accordance with Minnesota Statutes, Section 469.174, Subdivision 14 and Minnesota Statutes, Section 469.176, Subdivision 3, administrative expenses means all expenditures of an authority other than amounts paid for the purchase of land or amounts paid to contractors or others providing materials and services, including architectural and engineering services, directly connected with the physical development of the real property in the district, relocation benefits paid to or services provided for persons residing or businesses located in the district or amounts used to pay interest on, fund a reserve for, or sell at a discount bonds issued e pursuant to Section 469.178. Administrative expenses include amounts paid for services provided by bond counsel, fiscal consultants, and planning or economic development consultants. No tax increment shall be used to pay any administrative expenses for a project which exceed ten percent of the total tax increment expenditures authorized by the tax increment financing plan or the total tax increment expenditures for the project, whichever is less. Pursuant to Minnesota Statutes, Section 469.176, Subdivision 4h, tax increments may be used to pay for the county's actual administrative expenses incurred in connection with District No. 1-2. The county may require payment of those expenses by February 15 of the year following the year the expenses were incurred. P. DURATION OF TAX INCREMENT FINANCING DISTRICTS Pursuant to Minnesota Statutes, Section 469.176, Subdivision I, "no tax increment shall be paid to an authority three years from the date of certification by the County Auditor unless within the three-year period (1) bonds have been issued pursuant to Section 469.178, or in aid of a project pursuant to any other law, except revenue bonds issued pursuant to Chapter 469.152 to 469.165, prior to the effective date of the Act; or (2) the authority has acquired property within the district; or (3) the authority has constructed or caused to be constructed public improvements within the district. .. "The City or Authority must therefore issue bonds, or acquire property, or construct or cause public improvements in District No. 1-2 by approximately April, 1998. Q. LIMIT A TION ON au AUFICA nON OF PROPERTY IN TAX INCREMENT DISTRICT NOT SUBJECT TO IMPROVElvIENT . 7 . Pursuant to Minnesota Statutes, Section 469.176, Subdivision 6, . if, after four years from the date of certification of the original tax capacity of the tax increment financing district pursuant to Minnesota Statutes 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 financing plan, no additional tax increment may be taken from that parcel and the origi1Ull tax capacity of that parcel shall be excluded from the original 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 improvement of a street adjacent to that parcel, in accordance with the tax increment financing plan, the a!lthority shall certify to the county auditor in the annual disclosure report tJw.t the activity has commenced. The county auditor shall certify the tax capacity thereof as most recently certified by the commissioner of revenue and add it to the origi1Ull tax capacity of the tax increment financing district. The county auditor must enforce the prov~sions of this subdivision... For purposes of this subdivision, qualified improvements are limited to ( 1) constmction or opening of a new street, (2) relocation of a street, and (3) substantial reconstruction or rebuilding of an existing street. R. UNIIT A TION ON THE USE OF TAX INCREMENT Pursuant to Minnesota Statues, 469.176, Subd. 4, at least 90 percent of the revenues derived from tax increments from a redevelopment district must be used to finance the cost of correcting conditions that allow designation of redevelopment districts under section 469.174, Subdivision 10. These costs include acquiring properties containing structurally substandard buildings or improvements, acquiring adjacent parcels necessary to provide a site of sufficient size to permit development, demolition of structures, clearing of the . land and installation of utilities, roads, sidewalks, and parking facilities for the site. The revenues shall be used to fmance or otherwise pay public redevelopment and housing development costs pursuant to the HRA Act. These revenues shall not be used to circumvent any levy limit law. No revenues derived from tax increment shall be used for the construction or renovation of a municipally owned building used primarily and regularly for conducting the business of the municipality; this provision shall not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure, a commons area used as a public park or a facility used for social, recreational or conference purposes and not primarily for conducting the business of the municipality. For tax increment financing districts for which certification was requested after April 30, 1990, pursuant to Minnesota Statutes, Section 469.1763, Subdivisions 1 and 2, an amount equal to at least 75 percent of the revenue derived from tax increments from the district's parcels must be expended on activities in the district. S. NOTIFICA TION OF PRIOR PLAJfNED IMPROVEMENTS Pursuant to Minnesota Statutes, Section 469.177, Subdivision 4, the City and the Authority have reviewed the area to be included in District No. 1-2 and found no properties for which building permits have been issued during the 18 months immediately preceding approval of the Plan by the City. If a building permit had been issued within the 18 month period preceding approval of the plan by the City, the county auditors shall increase the original tax capacity of the district by the valuation of the improvements for which the building pennit was issued. . 8 , T. EXCESS TAX INCREMENTS . Pursuant to Minnesota Statutes, Section 469.176, Subdivision 2, in any year in which the tax increment exceeds the amount necessary to pay the costs authorized by the tax increment plan, including the amount necessary to cancel any tax levy as provided in Minnesota Statutes, Section 475.61, Subdivision 3, the authority shall use the excess amount to do any of the following: 1. prepay the outstanding bonds; 2. discharge the pledge of tax increment therefore; 3. pay into an escrow account dedicated to the payment of such bond; or 4. return the excess to the County Auditor for redistribution to the respective taxing jurisdictions in proportion to their tax capacity rate. The Authority may also modify this Plan to authorize additional costs. U. REQUIREMENT FOR AGREEMENTS WITH THE DEVELOPER The City or Authority will review any Developer's proposal to detennine 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 City or Authority to demonstrate the conformance of the development with city plans and ordinances. Land acquired by the City or Authority may be subject to a Contract for Sale upon disposition to the Developer. The general requirements to be imposed upon the . developer by the Contract for Sale are: l. To redevelop the land purchased in accordance with this development plan. 2. To commence and complete the building of improvements on the land within a reasonable period of time as determined by the City or Authority. 3. Not to resell the land before improvements are made without the prior consent of the City or Authority. 4. Not to discriminate on the basis of race, color, sex, creed or national origin on the sale, lease, transfer or occupancy of the land purchased from the City or Authority. The requirements to be imposed upon the Developer and the City's or Authority's exact participation in the project will be negotiated as part of the Development Agreement between the City or the Authority and the Developer. V. ASSESSMENT AGREEMENTS Pursuant to Minnesota Statutes, Section 469.177, Subdivision 8, the City or Authority may enter into an agreement in recordable form with the owner of property within the tax increment financing district which establishes a minimum market value of the land and improvements for the duration of the tax increment district. The assessment agreement shall be presented to the county assessor who shall review the plans and specifications for the improvements constructed, review the market value assigned to the land upon which . the improvements have been or will be constructed and, so long as the minimum market value contained in 9 . the assessment agreement appear, in the judgment of the assessor, to be a reasonable estimate, the assessor . may certify the minimum market value agreement. W. ADMINISTRATION OF DISTRICT AND MAINTENANCE OF THE TAX IN'CREMENT ACCOUNT Administration of District No. 1-2 will be handled by the City Manager or the Executive Director of the Authority. The tax increment received as a result of increases in the tax capacity of District No. 1-2 will be maintained in a special account separate from all other municipal accounts and expended only upon sanctioned municipal activities identified in the tax increment financing plan. X. FINANCIAL REPORTIN'G REQUIREMENTS Pursuant to Minnesota Statutes, Section 469.175, Subdivisions 6, and 6a; an authority must fue an annual disclosure report for all tax increment financing districts with the Office of the State Auditor, the county board, school board, and Department of Revenue. Y. MUNICIP AL APPROVAL Pursuant to Minnesota Statutes, Section 469.175, Subdivision 3, before or at the time of approval of the tax increment financing plan, the municipality shall make the following findings and shall set forth in writing the reasons and supporting facts for each determination. 1. Finding that the Tax Increment Financing District No. 1-2 is a redevelopment district as defined in . Minnesota Statutes, Section 469.175, Subd. 10. District No. 1-2 consists of 9 parcels of property. The District qualifies as a redevelopment district as defined in Minnesota Statutes, section 469.174, subd. 10. The Authority has demolished the substandard buildings located on the parcels included within the District. However, prior to demolishing the buildings and improvements, the Authority found by resolution that the parcel was occupied by a structurally substandard building and that it intended to include the parcel in a tax increment district. The Authority elects to treat the property in the District as being occupied by the demolished structurally substandard building as pennitted by section 469.174, subd. 10. The facts on which the Authority based its finding that the building was structurally substandard are as follows: 2. Finding that the proposed development, in the opinion of the City Council and the Authority, would not occur solely through private investment within the reasonably foreseeable future and, therefore, the use of tax increment financing is deemed necessary. Due to the high cost of redevelopment on parcels currently occupied by substandard buildings, 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. 3. Finding that the Tax Increment Financing Plan conforms to the general plan for the development or redevelopment of the municipality as a whole. . 10 ~ The site is appropriately zoned. The Tax Increment Financing Plan has been reviewed by the . Planning Commission and been found to confirm to the general development plan of the City. 4. Finding that the Tax Increment Financing Plan for Tax Increment Financing District No. 1-2 will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development of Redevelopment Project No. I by private enterprise. The establishment of Tax Increment Financing District No. 1-2 will result in increased employment for the City and will eliminate a blighting influence in the downtown area. Z. COUNTY ROAD COSTS Pursuant to Minnesota Statutes, Section 469.175, Subdivision la, the county board may require the authority 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 other county plan. The improvements outlined in the Plan serve as notice to the county that the development of the retail facility will be assisted with tax increment. In the opinion of the City, the Authority, and consultants, the proposed development will have little or no impact upon county roads. If the county elects to use increments to improve county roads, it must notify the City within thirty days of receipt of this plan. AA. REDUCTION IN STATE TAX INCREMENT FINANCING AID . Pursuant to Minnesota Statutes, Sections 273.1399, for tax increment financing districts for which certification was requested after April 30 1990, a municipality incurs a reduction in state tax increment financing aid (RISTIFA) applied to the municipality's Local Government Aids (LGA) first and, Homestead and Agricultural Aid (HACA) second, in an amount equal to a formula based upon the equalized qualifying captured tax capacity (QCIC) of the tax increment financing district. . 11 EXHIBIT A . Boundary Map of Tax Increment Financing District No. 1-2 as established April 4, 1995 . . A-I ---.-. 1oI\"",(TOi'lIll.,,"- THE CITY OF l HOPKJNS , MINNESOTA HENNEPIN COUNTY ""''' ... , .'" ,...,. -=-- , t J -~----.. 2 ,........ ~ ~ 11..:"' 3 I I ,. PROPOSED TIF DISTRICT 1-2 ' ;{ l . (FORMER SUBURBAN " , : ~ CHEVROLET SITE) 5 ------ " .".~",. A B C 0 . ... EXHIBIT B . Cashflow Analysis and Base Value Analysis . . B-1 ------- -------.- , 01')3/95 City of HOPKINS - SU6URAN PROJECT Page 1 T.I.F. CASH FLOW ASSUMPTIONS Inflation Rate: 0.0000% Pay-As- You-Go Interest Rate: 5.000% e Tax Extension Rate: 1.465720 Pay 95 Fiscal Disparities Rate: 0.00% School District No. 270 Basic Rate: 38.55% School District No. 270 Sales Ratio: 108.20% L.G.A. as a Percent of Tax Increment 24.31 % LGA Investment Rate: 4.000% BASE VALUE INFORMA nON Old Base Market New Base Value Value Value 24-117-22-34-0061 727 23,300 1,072 24-117-22-34-0063 363 11,600 534 24-117-22-34-0077 1,799 81,700 3,758 24-117-22-31-0046 764 29,300 1,348 24-117-22-31-0047 3,312 124,000 5,704 24-117-22-31-0048 1 ,490 54,000 2,484 24-117 -22-34-0058 16,284 865,300 38,204 24-117-22-34-0059 713 24,900 1,145 24-117-22-34-0060 727 23,300 1,072 TOTAL 26,179 1,237,400 55,321 Pay 95 ell >$100k 4.60% Pay 95 <$100k 3.00% Pay 95 . PROJECT INFO Ri"IA nON Type of Tax Increment District: New Redevelopment District Type of Development: Commercial Type of Total Taxes Per Total Tax Market Date Date Use Sq.Ft. Sq. Ft. Taxes Capacity Value Assessed Payable Restauran 7,000 $6.35 44,450 30,326 694,052 1996 1997 Theater 30,000 $4.58 137,400 93,7422,037,877 1996 1997 Total 37,000 181 ,850 124,0692,731,929 e HOlOo-oa Prepared by PubliGorp InG. SUSS . O:U03/95 City of HOPKINS - SUeURAN PROJECT Page. ~ T AX INCREMENT CASH FLOW Base Proj eel Semi-Annual Admin. Net PERIOD BEGINNING Tax Tax Gross Tax at Tax L.GA L. G.A. PERIOD ENDING Mth. Yr. Ca acil Ca aci Increment 10.00% Increment Phase In 24.31 % Yrs. Mth. Yr. 08-01 1994 55,321 55,321 0 0 0 0 0.00% 0 0.0 02-01 1995 0.0 02-01 1995 55,321 55,321 0 0 0 0 0.00% 0 0.0 08-01 1995 0.0 08-01 1995 55.321 55,321 0 0 0 0 0.00% 0 0.0 02-01 1996 0.0 02-01 1996 55,321 55,321 0 0 0 0 0.00% 0 0.0 08-01 1996 0.0 08-01 1996 55,321 55,321 0 0 0 0 0.00% 0 0.0 02-01 1997 0.0 02-01 1997 55,321 124,069 68,748 50,382 5,038 45.344 0.00% 0 0.5 08-01 1997 0.5 08-01 1997 55,321 124,069 68,748 50,382 5,038 45,344 0.00% 0 1.0 02-01 1998 1.0 02-01 1998 55.321 124.069 68,748 50,382 5.038 45.344 0.00% 0 1.5 08-01 1998 1.5 08-01 1998 55.321 124,069 68,748 50,382 5,Q38 45,344 0.00% 0 2.0 02-01 1999 2.0 02-01 1999 55,321 124,069 68,748 50,382 5,038 45,344 0.00% 0 2.5 08-01 1999 2.5 08-01 1999 55,321 124,069 68,748 50,382 5,Q38 45,344 0.00% 0 3.0 02-01 2000 3.0 02-01 2000 55,321 124.069 68,748 50.382 5,038 45,344 0.00% 0 3.5 08-01 2000 3.5 08-01 2000 55,321 124,069 68.748 50,382 5,038 45.344 6.25% 765 4.0 02-01 2001 4.0 02-01 2001 55,321 124,069 68,748 50,382 5,038 45,344 6.25% 765 4.5 08-01 2001 4.5 08-01 2001 55,321 124,069 68,748 50,382 5,Q38 45,344 12.50% 1,531 5.0 02-01 2002 5.0 02-01 2002 55.321 124,069 68,748 50,382 5,038 45,344 12.50% 1.531 5.5 08.0 1 2002 5.5 08-01 2002 55,321 124,069 68.748 50,382 5,Q38 45,344 18.75% 2.296 6.0 02-01 2003 6.0 02-01 2003 55,321 124,069 68,748 50.382 5,038 45,344 18.75% 2,296 6.5 08.01 2003 6.5 08-01 2003 55.321 124,069 68,748 50,382 5,038 45.344 25.00% 3,062 7.0 02-01 2004 7.0 02-01 2004 55,321 124,069 68,748 50,382 5,038 45,344 25.00% 3,062 7.5 08-01 2004 7.5 08-01 2004 55,321 124,069 68,748 50,382 5,038 45,344 31.25% 3,827 8.0 02-01 2005 8.0 02-01 2005 55,321 124,069 68,748 50,382 5,Q38 45.344 31.25% 3. 827 8.5 08.0 1 2005 8.5 08-01 2005 55,321 124,069 68,748 50,382 5,038 45,344 37.50% 4,593 9.0 02-01 2006 9.0 02-01 2006 55,321 124,069 68,748 50,382 5,038 45,344 37.50% 4,593 9.5 08-01 2006 9.5 08-01 2006 55,321 124,069 68,748 50,382 5,038 45.344 43.75% 5.358 10.0 02-01 2007 10.0 02-01 2007 55,321 124,069 68,748 50,382 5,038 45,344 43.75% 5,358 10.5 08-01 2007 10.5 08-01 2007 55,321 124,069 68,748 50.382 5,Q38 45,344 50.00% 6,123 11.0 02-01 2008 11.0 02-01 2008 55,321 124,069 68,748 50,382 5,038 45.344 50.00% 6.123 11.5 08-01 2008 11.5 08-01 2008 55,321 124,069 68,748 50,382 5,038 45,344 56.25% 6,889 12.0 02-01 2009 12.0 02-01 2009 55,321 124,069 68,748 50,382 5,038 45,344 56.25% 6,889 12.5 08-01 2009 12.5 08-01 2009 55,321 124,069 68,748 50,382 5,038 45,344 62.50% 7,654 13.0 02-01 2010 13.0 02-01 2010 55,321 124,069 68,748 50,382 5,038 45,344 62.50% 7,654 13.5 08.01 2010 .08-01 2010 55,321 124,069 68,748 50,382 5,038 45,344 68.75% 8,420 14.0 02-01 2011 02-01 2011 55.321 124,069 68,748 50,382 5,038 45,344 68.75% 8,420 14.5 08-01 2011 , 08-01 2011 55,321 124,069 68,748 50,382 5,038 45,344 75.00% 9,185 15.0 02-01 2012 15.0 02-01 2012 55,321 124,069 68,748 50,382 5,038 45,344 75.00% 9,185 15.5 08-01 2012 15.5 08-01 2012 55,321 124,069 68.748 50.382 5,038 45,344 81.25% 9,951 16.0 02-01 2013 16.0 02-01 2013 55.321 124,069 68,748 50.382 5,038 45,344 81.25% 9,951 16.5 08-01 2013 16.5 08-01 2013 55,321 124,069 68,748 50,382 5,038 45,344 87.50% 10,716 17.0 02-01 2014 17.0 02-01 2014 55.321 124,069 68,748 50,382 5,038 45.344 87.50% 10,716 17.5 08-01 2014 17.5 08-01 2014 55,321 124,069 68,748 50.382 5,Q38 45,344 93.75% 11,481 18.0 02-01 2015 18.0 02.01 2015 55,321 124,069 6B, 748 50,382 5,Q3B 45,344 93.75% 11.481 18.5 08-01 2015 18.5 08-01 2015 55,321 124,069 68,748 50.382 5,038 45.344 100.00% 12,247 19.0 02-01 2016 19.0 02-01 2016 55,321 124,069 68,748 50,382 5,038 45,344 100.00% 12,247 19.5 08-01 2016 19,5 08-01 2016 55,321 124,069 68,748 50,382 5,Q38 45,344 100.00% 12,247 20.0 02-01 2017 20.0 02.01 2017 55.321 124,069 68,748 50,382 5,038 45,344 100.00% 12,247 20.5 08-01 2017 20.5 08-01 2017 55,321 124,069 68,748 50.382 5,D38 45,344 100.00% 12,247 21.0 02-01 2018 21.0 02-01 2018 55,321 124,069 68,748 50.382 5,038 45,344 100.00% 12,247 21.5 08-01 2018 21.5 08-01 2018 55,321 124,069 68.148 50,382 5,038 45,344 100.00% 12,247 22.0 02-01 2019 22.0 02-01 2019 55,321 124.069 68,748 50.382 5.038 45,344 100.00% 12.247 22.5 08-01 2019 22.5 08-01 2019 55,321 124,069 68,748 50,382 5,038 45,344 100.00% 12,247 23.0 02-01 2020 no 02-01 2020 55,321 124,069 68,748 50.382 5,038 45,344 100.00% 12,247 23.5 08-01 2020 23.5 08.01 2020 55.321 124,069 68,748 50,382 5,038 45,344 100.00% 12,247 24.0 02-01 2021 24.0 02-01 2021 55,321 124,069 68,748 50,382 5,038 45.344 100.00% 12,247 24.5 08-01 2021 24.5 08-01 2021 55,321 124.069 68,748 50.382 5,038 45.344 100.00% 12.247 25.0 02-01 2022 Totals 2.519.123 251,912 2.267.210 342,913 Present Values 1 ,262.995 143.395 1.136,695 158,701 e H0100-08 Prepared by PubJicorp Inc. SUBS EXHIBIT C e Data on Qualifications as a Redevelopment Tax Increment Financing District The District qualifies as a redevelopment district as defined in Minnesota Statutes, section 469.174, subd. 10. The Authority has demolished the substandard buildings located on the parcels included within the District. However, prior to demolishing the buildings and improvements, the Authority found by resolution that the parcels were occupied by a structurally substandard building and that it intended to include the parcels in a tax increment district. The Authority elects to treat the property in the District as being occupied by the demolished structurally substandard building as pennitted by section 469.174, subd. 10. The facts on which the Authority based its finding that the building was structurally substandard are as follows: Percent Parcel Occupied of Parcel Number Buildings Parcel # Sq.Ft. Sq.Ft. Occupied of Bldgs. Substandard 24-117-22-31-0046 5,R50 5,850 100% 0 0 24-117-22-3]-0047 17 ,550 17,550 100% 1 1 24-117 22 3 t -0048 10,790 10,790 100% 0 0 24-117-22-34-0058 42,747 42.747 100% 1 ] 24-117-22-34-0059 7,114 7,114 100% 0 0 24 [] 7-22-34-0060 6,650 6.650 100% 0 0 24-117-22-34-006 ] 6,650 6,650 100% 0 0 24-117-22-34-0063 3,325 3,325 100% 0 0 24-117 22-34-0077 16,339 16,339 100% Q Q TOTAL 1 ]7,015 117.015 2. 1 e It C-I . Modifications to: Tax Increment Financing Plan for Tax Increment Financing District No. 2~1 (A 1985 Redevelopment District) Hopkins Housing and Redevelopment Authority Hennepin County City of Hopkins, Minnesota e Prepared: March 1, 1995 Revised: March 20, 1995 Adopted: April 4, 1995 Prepared by: PUBLICORP, INC. in association with EHLERS AND ASS o CIA TES, INC. 2950 Norwest Center 90 South Seventh Street Minneapolis, MN 55402-4100 (612) 339-8291 . -- - . --- .- . The modifications below are intended to replace specific sections of the Tax Increment Financing Plan for Tax Increment Financing District No. 2-1, most recently modified on November 7, 1989. Please refer to the complete Tax Increment Financing Plan, available from the office of the Community Development Director, City of Hopkins. N. ESTIMA TE OF PROJECT COSTS The estimate of public costs associated with District No. 2-1 are outlined in the following line item budget. This estimate of public costs is intended to supplement any previous estimate of project costs found in the Tax Increment Financing Plan for Tax Increment Financing District No. 2-1, most recently reorganized and modified on November 7; 1989. The following costs only include costs for projects that have either been initiated but not completed or that have not yet been started. Costs for completed projects within the District that have been completed are not included. The budget is intended to authorize additional expenditures over and above any expenditures made in any category as of the date of this amendment. Estimate of Public Costs - Project Cost Summary 1. County Road No.3 Improvements Acquisition, Demolition, and Other Development Costs 1.500.000 Subtotal Estimated Public Costs: I,500,000 2. Miscellaneous Public Improvements Acquisition, Demolition, and Other Development Costs 150,000 . Subtotal Estimated Public Costs: 150,000 3. County Road No.3 Development (R.L. Johnson Property) Acquisition, Demolition, and Other Development Costs 2,300,000 Subtotal Estimated Public Costs: 2,300,000 4. Miscellaneous Acquisition, Demolition, and Relocation Acquisition, Demolition, and Other Development Costs 500,000 Subtotal Estimated Public Costs: 500,000 TOTAL: $4.450.000 Capitalized interest and other interest payments on tax increment bonds and obligations are also considered to be public costs in addition to the above referenced estimate of public costs. Interest payments and capitalized interest will be determined at the time of issuance of the bonds and obligations and are dependent on interest rates in effect at such time. In addition, administration costs to cover city staff and overhead and various consulting fees in an amount not to exceed 10% of total tax increment will be funded with tax increments from District No. 2-1 in addition to above mentioned costs. To the extent tax increment from District No. 2-1 in any year exceeds the amount necessary to finance activities undertaken in accord with this Plan (including TIF Bond debt service and any other commitments), the Authority may contribute such excess to the City's commercial rehabilitation loan fund, the City's . Page 1 - TIF Plan No. 2-1 I f"6e..t" ~ ..f:n'- TIF PI 0(\ -fov~ Tt"F 0' "shr I Cr- \J6. 2- \ C V'Yj 0 cl. i 1=1 c..o..:tUJY"'I 'J . landscape loan/grant fund, the City's sign rehabilitation loan fund, or all three. Contribution to any of these funds will be placed in an account maintained for loans used exclusively within Redevelopment Project No. 1. The tax increments from District No. 2-1 may pay for public costs and TIF bonds outlined in budgets for Tax Increment Financing Districts No. 1-2 and 1-] (whether or not such expenditures exceed the total budget for this plan identified above). Tax increments from Tax Increment Financing District No. 1-2 and 1-1 may also be used to pay for costs associated with public costs outlined in this modified Plan. O. ESTlMA TED AMOUNT OF LOANIBONDED INDEBTEDNESS It is anticipated that the City or Authority may issue a revenue bond, general obligation bond, or other type of obligation in one or more series to finance any or an of the total costs authorized to under Section No of Plan. Tax increments from Tax Increment Financing District No. 1-2 and 1-1 may also be used to pay for debt service on bonds and obligations financed from District No.2-I. The total bonded indebtedness authorized in this Plan amendment is in addition to any TIP Bonds as of the date of this amendment. . . Page 2 - TIP Plan No. 2-1 -. . Boundary Map of Tax Increment Financing District No. 2-1 . . Page 3 - TIF Plan No. 2-1 ~ - - - - - - - - ~ - THE GITY OF .....Ii(.lQH..A HOPKINS, MINNESOTA ~ II It_ -r HENNEPIN COUNTY .cm Ol,,, 0 "" "'" 1 - - , I ~ , , I I I' 1 ~ J ______..1 I, \.' 2 F r '.1.'". I J. ~ ~"I~f1 OlUllDN IIIC1DE O. 3 : : ~ ~ ~ 4 TIF DISTRICT 2-1 5 , .. ~~\ ~ .,.....rl ~t '--~-...............->.. .1- < . ...4..........; ~ I h. " ------ !U.j1'f[1'OI(u "..*,". A B C D .-- ";l'F-' .. -....r ~J~ . ~~y;; :.:~. '.;~~ ':':"'. ~~~, :~-;i ,~t: :;~~~ ~f/ . . Modifications to: Tax Increment Financing Plan for Tax Increment Financing District No. 1-1 (A Pre-1979 Redevelopment District) Housing and Redevelopment Authority in and for the City of Hopkins Hennepin County City of Hopkins, Minnesota . Prepared: March 1, 1995 Revised: March 20, 1995 Adopted: Apri14, 1995 Prepared by: PUBLICORP, INe. in association with EHLERS AND ASSOCIATES, INC. 2950 Norwest Center 90 South Seventh Street Minneapolis, MN 55402-4100 (612) 339-8291 e . The modifications below are intended to replace specific sections of the Tax Increment Financing Plan for Tax Increment Financing District No.1-I, most recently modified on November 7,1989. Please refer to the complete Tax Increment Financing Plan, available from the office of the Community Development Director, City of Hopkins. N. ESTIMA TE OF PROJECT COSTS The estimate of public costs associated with District No. 1- I are outlined in the following line item budget. This estimate of public costs is intended to supplement any previous estimate of project costs found in the Tax Increment Financing Plan for Tax Increment Financing District No. 1- I, most recently reorganized and modified on November 7, 1989. The following costs only include costs for projects that have either been initiated but not completed or that have not yet been started. Costs for completed projects within the District that have been completed are not included. The budget below is intended to authorize additional expenditures over and above any expenditures made in any category as of the date of this amendment. Estimate of Public Costs - Project Cost Summary 1 *. Alleyscape/Parking Improvements Acquisition, Demolition, and Other Development Costs $450,000 Subtotal Estimated Public Costs: $450,000 2*. Mainstreet Renovation Acquisition, Demolition, and Other Development Costs 1.850,000 . Subtotal Estimated Public Costs: 1,850,000 3*. Underground Utilities Acquisition, Demolition, and Other Development Costs 400,000 Subtotal Estimated Public Costs: 400,000 4. Bursch Block Development Acquisition, Demolition, and Other Development Costs 550.000 Subtotal Estimated Public Costs: 550,000 5 Grocery Retail Development Acquisition, Demolition, and Other Development Costs 500,000 Subtotal Estimated Public Costs: 500,000 6. Miscellaneous Public Improvements Acquisition, Demolition, and Other Development Costs 300,000 Subtotal Estimated Public Costs: 300,000 TOT AL: $4.050.000 Capitalized interest and other interest payments on tax increment bonds and obligations are also considered to be public costs in addition to the above referenced estimate of public costs. Interest payments and capitalized interest will be determined at the time of issuance of the bonds and obligations. In addition, administration costs to cover city staff and overhead and various consulting fees in an amount not to exceed . * Denotes substantially completed activities. Page 1 - TIF Plan No. 1-1 10% of total tax increment will be funded with tax increments from District No. 1-1 in addition to above . mentioned costs. To the extent tax increment from District No. 1-1 in any year exceeds the amount necessary to finance activities undertaken in accord with this Plan (induding TIF Bond debt service and any other commitments), the Authority may contribute such excess to the City's commercial rehabilitation loan fund, the City's landscape loan/grant fund, the City's sign rehabilitation loan fund, or all three. Contribution to any of these funds will be placed in an account maintained for loans used exclusively within Redevelopment Project No. I. The tax increments from District No. I-I may be used to pay for public costs and TIF bonds outlined in budgets for Tax Increment Financing Districts No. 1-2 and 2-1 (whether or not such expenditures exceed the total budget for this plan identified above). Tax increments from Tax Increment Financing District No. 1-2 and 2-1 may also be used to pay for costs associated with public costs outlined in this modified Plan. O. ESTIMA TED AMOUNT OF LOAN/BONDED INDEBTEDNESS It is anticipated that the City or Authority may issue a revenue bond, general obligation bond, or other type of obligation in one or more series to finance any of all of the total costs authorized under Section N of this Plan. Tax increments from Tax Increment Financing District No. 1-2 and 2-1 may also be used to pay for debt service on bonds and obligations financed from District No. I-I. The total bonded indebtedness authorized in this Plan amendment is in addition to any TIF Bonds issued as of the date of this amendment. . . Page 2 - TIF Plan No. I-I . Boundary Map of Tax Increment Financing District No. 1-1 . . Page 3 - TIF Plan No. 1-1 . .. - - --- - . - -- -.... --- - ~ -. - - - ~.- - - THE CITY OF HOPKINS, MINNESOTA HENNEPIN COUNTY 1 """, "'" . IOU - ~- , -::::l I. t " .... f.. ~. !/ ~-:, ,. ~"'----'. ,I 2 /: I ..... . .. ~ _ J '-'"1"'''1 C1lUllCN lilaOf' D. 3 . . . ~ :; 4 [OI~" $ , TIF DISTRICT 1-1 , J . , , I I I Y i L Y I 5 . f . I , I ....._~...... , '''::-.,--.1-, I I.-yO . , J , I r , , , " -_.......~....----- -"""" ~"'... '''"0/'''. A B C 0 ---., ~. .r .... _'~'_'_ ~~ .......----~. . ._, ~.~ '~'---...--..- -_.~-~ -~----~ -_4. __...... ......_-,._ . - 1~~ - :.Ii.: :If};; - ~~ :'i!'f om; ~ !" ;;~* ~~, ~~! -.",. }. ; :-~J ~ ,... / TAX INCREMENT Q AND A FOR APRIL 4 , 1995, PUBLIC HEARING e CERTIFICATION OF TAX INCREMENT DISTRICT 1-2 (Former Suburban Chevrolet Property) . What is the purpose of Tax Increment District 1-21 The purpose of Tax Increment District 1-2 is to provide a funding source for the redevelopment of the Suburban Chevrolet property. . What is the impact of Tax Increment District 1-21 with certification of TIF District 1-2, the owner of an $86,000 house in Hopkins will see the City's portion of their property taxes actually decrease by approximately 61 cents. . What is the current base value of the former Suburban Chevrolet property in comparison to the new base value upon certification of proposed TIF District 1-21 The current base value is 26,179 because the property is already located in a tax increment district (1-1) . The new base value of the proposed TIF District 1-2 will be 55,321. t \ This is actually an increase in the base value, which is the value upon which the various taxing jurisdictions will continue to receive taxes until the TIF district is decertified in 2021. At that time the full value of the project will contribute to the tax revenues of the taxing jurisdictions (approximately 124(000). . What is the effect on the three taxing jurisdictions due to the certification of TIF District 1-21 Due to the fact that the new district would be certified with a base value that is approximately twice that of the old base value, the school district, county, and city will receive an increase in taxes. Amount of Annual Increase School District $ 21,879 County $ 10,914 City $ 7,924 These are additional tax dollars which will be raised due to the certification of the new TIF District 1-2. PS03285A - . The modifications below are intended to replace specific sections of the Tax Increment Financing Plan for Tax Increment Financing District No. 2-1, most recently modified on November 7, 1989. Please refer to the complete Tax Increment Financing Plan, available from the office of the Community Development Director, City of Hopkins. N. ESTIMA TE OF PROJECT COSTS The estimate of public costs associated with District No. 2-1 are outlined in the following line item budget. This estimate of public costs is intended to supplement any previous estimate of project costs found in the Tax Increment Financing Plan for Tax Increment Financing District No. 2- L, most recently reorganized and modified on November 7, 1989. The following costs only include costs for projects that have either been initiated but not completed or that have not yet been started. Costs for completed projects within the District that have been completed are not included. The budget is intended to authorize additional expenditures over and above any expenditures made in any category as of the date of this amendment. Estimate of Public Costs - Project Cost Summary 1. County Road No.3 Improvements Acquisition, Demolition, and Other Development Costs 1.500,000 Subtotal Estimated Public Costs: 1,500,000 2. Miscellaneous Public Improvements Acquisition, Demolition, and Other Development Costs 150,000 . Subtotal Estimated Public Costs: 150,000 3. County Road No.3 Development (R.L. Johnson Property) Acquisition, Demolition, and Other Development Costs 2,300,000 Subtotal Estimated Public Costs: 2,300,000 4. Miscellaneous Acquisition, Demolition, and Relocation Acquisition, Demolition, and Other Development Costs 500,000 Subtotal Estimated Public Costs: 500,000 TOT AL: $4.450.000 Capitalized interest and other interest payments on tax increment bonds and obligations are also considered to be public costs in addition to the above referenced estimate of public costs. Interest payments and capitalized interest will be determined at the time of issuance of the bonds and obligations and are dependent on interest rates in effect at such time. In addition, administration costs to cover city staff and overhead and various consulting fees in an amount not to exceed 10% of total tax increment will be funded with tax increments from District No. 2-1 in addition to above mentioned costs. To the extent tax increment from District No. 2-1 in any year exceeds the amount necessary to finance activities undertaken in accord with this Plan (including TIF Bond debt service and any other commitments), the Authority may contribute such excess to the City's commercial rehabilitation loan fund, the City's . Page 1 - TlF Plan No. 2-1 lyr't'Se-l; .k by' TIF PI ar\ fuv- TI"F D 'strICT- "-J6. 2 - \ l V'Yl ad ; 1='1 ca.::ruJY"'1 'J ----- . landscape loan/grant fund, the City's sign rehabilitation loan fund, or all three. Contribution to any of these funds will be placed in an account maintained for loans used exclusively within Redevelopment Project No. I. The tax increments from District No. 2-1 may pay for public costs and TIF bonds outlined in budgets for Tax Increment Financing Districts No. 1-2 and I-I (whether or not such expenditures exceed the total budget for this plan identified above). Tax increments from Tax Increment Financing District No. 1-2 and 1-1 may also be used to pay for costs associated with public costs outlined in this modified Plan. O. ESTIMATED AMOUNT OF LOAN/BONDED INDEBTEDNESS It is anticipated that the City or Authority may issue a revenue bond, general obligation bond, or other type of obligation in one or more series to finance any or all of the total costs authorized to under Section No of Plan. Tax increments from Tax Increment Financing District No. ] -2 and 1-1 may also be used to pay for debt service on bonds and obligations financed from District No.2-I. The total bonded indebtedness authorized in this Plan amendment is in addition to any TIF Bonds as of the date of this amendment. . . Page 2 - TIP Plan No. 2-1 - - , . Boundary Map of Tax Increment Financing District No. 2-1 . . Page 3 - TIF Plan No. 2-1 ~ - - - - - - - - - - --- THE CITY OF wIftH'l(l'H"'" . . HOPKINS, MINNESOTA HENNEPIN COUNTY leA" 1 "" 0 .w "'" _ _ I , I 1 I I ,. I , , , l--~l WIHHfT OMIt.. \ " ~~. C I v-..,....1.. I --------, 2 ........ ~ 3 0 , I I I : I I I I I , , I I , I I ____J.. 4 TIF DISTRICT 2-1 l I 5 I 1 , I I I ~~"'>.' .1-, I Jp . I - I ~ I _ I I I - ... " ~ - '..-f..u. I.IItff.'C~kA $ ....!.j1".. A B C D - --. . ~. ~ .~. . ~~ ~~}. ~ <......' ..).~ .:;~;;:. ,-....'. ~l:~';- ". :"'~ >f~ ",:1l:J, tt :~~~ '!:i/- -- , . Modifications to: Tax Increment Financing Plan for Tax Increment Financing District No. 1-1 (A Pre-1979 Redevelopment District) Housing and Redevelopment Authority in and for the City of Hopkins Hennepin County City of Hopkins, Minnesota . Prepared: March 1, 1995 Revised: March 20, 1995 Adopted: April 4, 1995 Prepared by: PUBLICORP, INC. in association with EHLERS AND ASSOCIATES, INC. 2950 Norwest Center 90 South Seventh Street Minneapolis, MN 55402-4100 (612) 339-8291 e . The modifications below are intended to replace specific sections of the Tax Increment Financing Plan for Tax Increment Financing District No.1-I, most recently modified on November 7, 1989. Please refer to the complete Tax Increment Financing Plan, available from the office of the Community Development Director, City of Hopkins. N. ESTIMA TE OF PROJECT COSTS The estimate of public costs associated with District No. 1-1 are outlined in the following line item budget. This estimate of public costs is intended to supplement any previous estimate of project costs found in the Tax Increment Financing Plan for Tax Increment Financing District No. 1- I, most recently reorganized and modified on November 7, 1989. The following costs only include costs for projects that have either been initiated but not completed or that have not yet been started. Costs for completed projects within the District that have been completed are not included. The budget below is intended to authorize additional expenditures over and above any expenditures made in any category as of the date of this amendment. Estimate of Public Costs - Project Cost Summary 1 *. Alleyscape/Parking Improvements Acquisition, Demolition, and Other Development Costs $450,000 Subtotal Estimated Public Costs: $450,000 2*. Mainstreet Renovation Acquisition, Demolition, and Other Development Costs 1 ,850,000 . Subtotal Estimated Public Costs: 1,850,000 3*. U ndergrouml Utili ties Acquisition, Demolition, and Other Development Costs 400,000 Subtotal Estimated Public Costs: 400,000 4. Bursch Block Development Acquisition, Demolition, and Other Development Costs 550,000 Subtotal Estimated Public Costs: 550,000 5 Grocery Retail Development Acquisition, Demolition, and Other Development Costs 500,000 Subtotal Estimated Public Costs: 500,000 6. Miscellaneous Public Improvements Acquisition, Demolition, and Other Development Costs 300,000 Subtotal Estimated Public Costs: 300,000 TOT AL: $4.050.000 Capitalized interest and other interest payments on tax increment bonds and obligations are also considered to be public costs in addition to the above referenced estimate of public costs. Interest payments and capitalized interest will be determined at the time of issuance of the bonds and obligations. In addition, administration costs to cover city staff and overhead and various consulting fees in an amount not to exceed . * Denotes substantially COlllpleted activities. Page 1 - TIF Plan No. 1-1 -- .. - -- -. ---- --.--.----..--. 10% of total tax increment will be funded with tax increments from District No. I-I in addition to above . mentioned costs. To the extent tax increment from District No. I-I in any year exceeds the amount necessary to finance activities undertaken in accord with this Plan (induding TIF Bond debt service and any other commitments), the Authority may contribute such excess to the City's commercial rehabilitation loan fund, the City's landscape loan/grant fund, the City's sign rehabilitation loan fund, or all three. Contribution to any of these funds will be placed in an account maintained for loans used exclusively within Redevelopment Project No. 1. The tax increments from District No. ] -I may be used to pay for public costs and TIF bonds outlined in budgets for Tax Increment Financing Districts No. 1-2 and 2-1 (whether or not such expenditures exceed the total budget for this plan identified above). Tax increments from Tax Increment Financing District No. 1-2 and 2-1 may also be used to pay for costs associated with public costs outlined in this modified Plan. O. ESTIMA TED AMOUNT OF LOAN/BONDED INDEBTEDNESS It is anticipated that the City or Authority may issue a revenue bond, general obligation bond, or other type of obligation in one or more series to finance any of all of the total costs authorized under Section N of this Plan. Tax increments from Tax Increment Financing District No. 1-2 and 2-1 may also be used to pay for debt service on bonds and obligations financed from District No.1-I. The total bonded indebtedness authorized in this Plan amendment is in addition to any TlF Bonds issued as of the date of this amendment. . . Page 2 - TIF Plan No. I-I . . Boundary Map of Tax Increment Financing District No. 1-1 . . Page 3 - TIF Plan No. 1-1 . -.------------ --..-- --- ---- - :......... -... ........... - ~ - - - --. ~ - - .~ THE CITY OF --:~ HOPKINS, MINNESOTA I I HENNEPIN COUNTY ! - ""''' 1 "" , .ro '''''' _ _ J , , " t t< H r. ~ I:, ______J, ~; . ' ,! 2 I! I' ........ - , .. C.....l' 1;1I"'0:.. IIC"Got~.. 3 4 fO'''''' TIF DISTRICT 1-1 i 5 I . B " "-"'"'" ."t. UI.$-II'~ A B C D .--.. "-. .. -.- --.- W!.~ -----..-. .... ...._~_.._---~ ._~--_. ._~ ~..._.. . .~-.., - "f,~~ e ):~: ';,'f;.; ~~ :","~ .~ ~. .~. r - .. ~,~.4 ~ , . ~ TAX INCREMENT Q AND A FOR APRIL 4, 1995, PUBLIC HEARING . CERTIFICATION OF TAX INCREMENT DISTRICT 1-2 (Former Suburban Chevrolet Property) . What is the purpose of Tax Increment District 1-2? The purpose of Tax Increment District 1-2 is to provide a funding source for the redevelopment of the Suburban Chevrolet property. . What is the impact of Tax Increment District 1-2? with certification of TIF Distri~ 1-2, the owner of an $86,000 house in Hopkins will se~he City's portion of their property taxes actually decrease oy approximately 61 cents. . What is the current base value of the former Suburban Chevrolet property in comparison to the new base value upon certification of proposed TIF District 1-2? The current base value is 26,179 because the property is already located in a tax increment district (1-1) . The new base value of the proposed TIF District 1-2 will be . 55,321- This is actually an increase in the base value, which is the value upon which the various taxing jurisdictions will continue to receive taxes until the TIF district is decertified in 2021. At that time the full value of the project will contribute to the tax revenues of the taxing jurisdictions (approximately 124,000). . What is the effect on the three taxing jurisdictions due to the certification of TIF District 1-2? Due to the fact that the new district would be certified with a base value that is approximately twice that of the old base value, the school district, county, and city will receive an increase in taxes. Amount of Annual Increase School District $ 21,879 County $ 10,914 City $ 7,924 These are additional tax dollars which will be raised due to the certification of the new TIF District 1-2. e PS03285A --..- -------- ------ ---- --- - . e . What is the length of the new District 1-2? The length of the new district will be 25 years. It will decertify in the year 2021. . What is the length of time the former Suburban Chevrolet property would remain in a tax increment district if the new TIF District 1-2 is not certified? The former Suburban Chevrolet property is currently located in TIF District 1-1. This district will decertify in 14 years. . What effect would the movie theater/restaurant project have on the owner of an $86,000 home if the project were NOT located within a tax increment district. If the project was not able to be located within a new Tax Increment District 1-2, there will likely not be the funds available to complete the project; therefore, when the former Suburban Chevrolet property is taken out of the current district (1-1) in the year 2010, the effect on a homeowner's property taxes will be minimal. . What if the movie theater/restaurant project were constructed in the current district (1-1), without certification of new TIF . District 1-2? If by chance the project were constructed without a new district being created, the current TIF district in which it is located would still be decertified in the year 2010. The effect of this after the year 2010 would be as follows. . The city's share of property taxes paid on an $86,000 house in Hopkins would decrease by approximately $2.59 annually (after the year 2010). . PS03285A BUDGET REVISION TIF DISTRICTS 1-1 2-1, 1-2 , . PREVIOUSLY PROPOSED BUDGET APPROVED REVISIONS - 4/95 BUDGET 11/89 Tax Increment District 1-1 I. Alleyscape/parking improvements $ 450,000 $ 360,000 2. Mainstreet renovation $ 1,850,000 $ 370,000 3. Underground utilities $ 400,000 $ 320,000 4. Bursch block development $ 550,000 $ 950,000 5. Grocery/retail development $ 500,000 $ 750,000 6. Misc. public improvements $ 300,000 $ 300,000 7. Housing development $ 0 $ 805,000 8. Block 67 development $ 0 $ 350,000 9. Block 5 development $ 0 $ 790,000 10. Other land acquisition $ 0 $ 65,000 1I. Suburban Chevrolet development $ 0 $ 1,900,000 . 12. Parking Ramp $ 0 $ 1,100,000 Tax Increment District 1-2 I. Acquisition/loans to developer Suburban Chevrolet property $ 4,000,000 $ 0 2. Arts facility $ 1,500,000 $ 0 Tax Increment District 2-1 I. Underground utilities $ 0 $ 80,000 2. County Road 3 improvement $ 1,500,000 $ 1,500,000 3. Misc. public improvements $ 150,000 $ 150,000 4. R.L.Johnson property development $ 2,300,000 $ 0 5. Misc. acquisition/ demolition/relocation $ 500,000 $ 0 6. Mainstreet renovation $ 0 $ 149,500 e 7. Grocery store development $ 0 $ 950,000 8. Housing development $ 0 $ 1,200,000 JKD3025D . EXPENDITUREIREVENUE PROJECTIONS TIF DISTRICTS 1-1 & 1-2 REMAINING EXPENDITURES Suburban Chevrolet Site Theatre/Restaurant 1,400,000 (Loan I) Theatre/Restaurant 750,000 (Loan II) Arts Facility 1,500,000 Total 3,650,000 Bursch Site . Acquisition 350,000 Developer Loan 200,000 Total 550,000 Commercial Rehab. Program - $ 50,000 per year through 2001 350,000 Administration - $80,000 per year through 2001 560,000 Grocery Store - Rehab Loan 200,000 Total Proposed Expenditures .$5,310,000 . JK03285A --- . Revenue Available TIF funds 1,800,000 Future Bond Capacity 2,000,000 Subtotal $3,800,000 Projected Revenue 1-2 $1,000,000 Total Revenue $4,800,000 Total Proposed Expenditures $5,310,000 (from previous page) (defici t) ($ 510,000) ISSUES FOR CONSIDERATION - Bond Issue capacity based on analysis prepared by Publicorp. Could vary depending on tax e classification changes, timing of bond issue, and lowering of CBD tax base due to abatements. - The revenue projections do not assume the repayment of any of the loans for the cinema project. - The available revenue does not include resources from the Economic Development Fund. - Available TIF as of May 1995. Incudes deduction of $200,000 for Mainstreet, Fifth to Washington. . JK03285A