CR 95-20 Collection of Tax Increment
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. January 3 1, 1995 ~ Council Report 95-020
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SPECIAL LEGISLATION EXTENDING THE COLLECTION OF TAX INCREMENT
FROM TAX INCREMENT DISTRICT 1-1
Proposed Action.
Staff recommends adoption of the following motion: Move to approve Resolution 95-3 in
support of special legislation to extend the collection of tax increments in Tax Increment District
1-1 until 2009.
With approval of this action, Staffwill continue to work with the local legislators for Hopkins in
an effort to secure approval of this legislation during the 1995 legislative session.
Overview.
At the recent Council retreat, Staff discussed the following items with the Council.
0 Expenditures relating to the cost of undertaking the various projects now under
consideration by the City Council/HRA,
0 Revenues available, both now and in the future, to undertake these projects and other
. activities.
Based upon this discussion, it became clear that there will probably not be sufficient dollars
available to complete all the activities under consideration. One alternative that was detailed by
Staff to make up this shortfall was to secure special legislation, which would allow the City to
collect tax increments from Tax Increment District 1-1 (downtown tax increment district) until
2009.
Primary Issues to Consider.
0 What is the impact of this action?
0 What is the purpose of this action?
SUDDortin1!: Documents.
0 Alternatives.
0 Resolution 95-3
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James D. KerrigAn /
Director of Planning and 1iconomic Development
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CR95-020
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. Primary Issues to Consider.
0 What is the impact of this action?
Presently, for tax increment districts created prior to 1979 such as Hopkins TIF District
1-1, tax increments may be collected only in accordance with the following statutory
requirements.
. Until 2001, tax increments can be collected to be used for eligible activities.
. From 2001 until 2009, increments may be collected only to payoff outstanding
bonded indebtedness for bonds which were sold prior to May 1990.
Tax Increment District 1-1 presently has bonds which are payable until the 2009
termination date of the district. However, Staff has estimated that for the period from
2001 to 2009 there are sufficient tax increments generated to both retire these bonds and
provide an additional $2 million in bonding capacity to finance redevelopment projects.
If the special legislation is approved, the City is not obligated to implement it. The
legislation will only provide the authority for the City to extend the period of time during
which the increment can be collected,
0 What is the purpose of this action?
. Approval of the action under consideration will demonstrate to the local legislators
representing Hopkins that the City Council supports them in their effort to secure this
special legislation. Staffhas already met with both Senator Mondale and Representative
Kelley, and they are agreeable to sponsoring the legislation.
Alternatives.
The City Counci1JHRA have the following alternatives regarding this matter.
1. Approve the action as recommended by Staff
2. Deny the application. It will be assumed by this action that the City CouncillHRA are not
interested in pursuing this matter.
3. Continue for additional information. The Council needs to be aware that because the
Legislature is presently in session, it is important that if there is an interest in this matter
we proceed as expediently as possible.
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eRgS-020
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CITY OF HOPKINS
. Hennepin County, Minnesota
RESOLUTION NO: RZ95-3
RESOLUTION OF SUPPORT FOR SPECIAL LEGISLATION EXTENDING THE COLLECTION
OF TAX INCREMENTS FROM TAX INCREMENT DISTRICT 1-1
WHEREAS, the City of Hopkins and the Housing and
Redevelopment Authority in and for the city of Hopkins are authorized
by Minnesota statutes to create tax increment districts to facilitate
redevelopment projects; and
WHEREAS, the city of Hopkins and the Housing and Redevelopment
Authority in and for the City of Hopkins, in 1971, created Tax
Increment District 1-1 within its central business district for
redevelopment purposes; and
WHEREAS, the central business district consists of older,
substandard buildings/sites which require substantial tax increment
dollars to overcome deficiencies, i.e., demolition, asbestos
abatement, other environmental issues; and
WHEREAS, Minnesota statutes restrict the collection of tax ,
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increments for the period between 2001 and 2009 for any activity other I
than the payment of bonded indebtedness incurred by that district
. prior to May 1990, for tax increment districts created prior to 1979;
and
WHEREAS, it has been determined that the City of Hopkins and the
Housing and Redevelopment Authority in and for the City of Hopkins
will require the collection of tax increments between 2001 and 2009 to
be used to carry out various rehabilitation and redevelopment efforts
and provide incentives to redevelopers in order to increase investment
and create jobs in the central business district; and
WHEREAS, the City of Hopkins and the Housing and Redevelopment
Authority in and for the City of Hopkins intend to fulfill the
original intention of tax increment financing in that its use will be
solely for redevelopment of sites which are currently occupied by
substandard buildings or structures.
NOW THEREFORE, BE IT RESOLVED that the City Council of the city
of Hopkins hereby supports the proposed legislation to extend the
collection of tax increments in Tax Increment District 1-1 within the
city of Hopkins until 2009 and the use of such tax increment to
finance additional redevelopment and development activity.
Adopted this 7th day of February, 1995.
. Charles D. Redepenning, Mayor
Jim Genellie, city Clerk
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