1998-061CITY OF HOPKINS
HENNEPIN COUNTY
STATE OF MINNESOTA
Council member Hesch introduced the following resolution and moved its adoption:
RESOLUTION NO. 98-061
RESOLUTION ADOPTING THE MODIFICATION TO THE REDEVELOPMENT
PLAN FOR REDEVELOPMENT PROJECT NO. 1; AND ESTABLISHING TAX
INCREMENT FINANCING DISTRICT N0.2-11 THEREIN AND ADOPTING THE
RELATED TAX INCREMENT FINANCING PLAN THEREFOR.
BE IT RESOLVED by the City Council (the "Council") of the City of Hopkins, Minnesota (the
"City"), as follows:
Section 1. Recitals.
1.01. The HRA has heretofore established Redevelopment Project No. 1 and adopted the
Redevelopment Plan therefor. It has been proposed that the City establish within Redevelopment Project
No. 1 Tax Increment Financing District No. 2-l l ("District No. 2-11 ") and adopt the related Tax Increment
Financing Plan therefor (the "Plan"); all pursuant to and in conformity with applicable law, including
Minnesota Statutes, Sections 469.001 through 469.047 and 469.174 through 469.179, all inclusive, as
amended, all as reflected in the Plan, and presented for the Council's consideration.
1.02. The Council has investigated the facts relating to the Plan.
1.03. The City has performed all actions required by law to be performed prior to the adoption and
approval of the proposed Plan, including, but not limited to, notification of Hennepin County and School
District No. 270 having taxing jurisdiction over the property to be included in District No. 2-11, notice of
a potential redevelopment district to the Local county commissioner, a review of and written commenton the
Plan by the City Planning Commission, and the holding of a public hearing upon published notice as required
by law.
1.04. Certain written reports (the "Reports") relating to the Plan and to the activities contemplated
therein have heretofore been prepared by staff and submitted to the Council and/or made a part of the City
files and proceedings on the Plan. The Reports include data, information and/or substantiation constituting
or relating to the bases forthe other findings and determ inations made in this resolution. The Council hereby
confirms, ratifies and adopts the Reports, which are hereby incorporated into and made as fully a part ofthis
resolution to the same extent as if set forth in full herein.
Section 2. Findings for the Adoption and Approval of the Plan.
2.01. The Council hereby finds that the Plan, is intended and, in the judgment ofthis Council, the
effect of such actions will be, to provide an impetus for redevelopment in the public purpose and accomplish
N: \M innsota\HOPKINS\Ti f1-1 I \city_res.wpd
certain objectives as specified in the Plan, which is hereby incorporated herein.
Section 3. Findings for the Establishment of Tax Increment Financing District No. 2-11.
3.01. The Council hereby finds that Tax Increment Financing District No. 2-I 1 is in the public
interest and is a "redevelopment district" under Minnesota Statutes, Section 469.174, subd. 10 (a)(l).
3.02. The Council further finds that the proposed development would not occur solely through
private investment within the reasonably foreseeable future and that the increased market value on the site
that could reasonably be expected to occur without the use of tax increment financing would be less than the
increase in the market value estimated to result from the proposed development after subtracting the present
value of the projected tax increments for the maximum duration of District No. 2-11 permitted by the Tax
Increment Financing Plan, that the Plan conforms to the general plan for the development or redevelopment
of the City as a whole; and that the Plan will afford maximum opportunity consistent with the sound needs
of the City as a whole, for the development of District No. 2-11 by private enterprise.
3.03. The City elects to make a qualifying local contribution in accordance with Minnesota
Statutes, Section 273.1399, subd. 6(d), in order to qualify District No. 2-1 l for exemption from state aid
losses set forth in Section 273.1399.
3.04. The Council further finds, declares and determines that the City made the above findings
stated in this Section and has set forth the reasons and supporting facts for each determination in writing,
attached hereto as Exhibit A.
3.05. The City of Hopkins elects to calculate fiscal disparities for District No. 2-11 in accordance
with Minnesota Statutes, Section 469.177, subdivision 3, clause b, which means the fiscal disparities
contribution will be taken from within DistrictNo. 2-11.
Section 4. Approval and Adoption of the Plan.
4.01. The Plan, as presented to the Council on this date, including without limitation the findings
and statements of objectives contained therein, is hereby approved, ratified, established, and adopted and
shall be placed on file in the office of the Economic Development Director.
4.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to
proceed with the implementation of the Plan and to negotiate, draft, prepare and present to this Council for
its consideration all further plans, resolutions, documents and contracts necessary for this purpose.
4.03 The Auditor of Hennepin County is requested to certify the original net tax capacity of
District No. 2-11, as described in the Plan, and to certify in each year thereafter the amount by which the
original net tax capacity has increased or decreased; and the City of Hopkins is authorized and directed to
forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify,
together with a list of all properties within District No. 2-l 1, for which building permits have been issued
during the 18 months immediately preceding the adoption of this resolution.
N:\Minnsota\HOPKINS\T~f2-1 I \city_res.wpd
The motion for the adoption of the foregoing resolution was duly seconded by Council member
Jensen ,and upon a vote being taken thereon, the following voted in favor thereof:
Mayor Redepenning
Council Member Hesch
Council Member Jensen
Council Member Johnson
and the following voted against the same:
Council Member Maxwell
Dated: October 6, 1998
i
Mayor
(Seal)
ATTEST: ~-°~
~~ ~
City Clerk
l ~~
N:\Minnsota\HOPKINS\TiR-1 l\city_res.wpd
EXHIBIT A
RESOLUTION # 98-061
The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax
Increment Financing District No. 2-11, ("District No. 2-11 ") as required pursuant to Minnesota Statutes, Section
469.]75, Subdivision 3 are as follows:
Finding that District No. 2-11 is a redevelopment district as defined in M.S., Section 469.174, Subd.
10(a) (1).
DistrictNo. 2-11 consists of 11 parcels, with plansto redevelopthe area for commercial purposes. At least
70 percent of the area in the parcels in DistrictNo. 2-11 are occupied by buildings, streets, utilities, or other
improvements and more than 50 percent of the buildings in DistrictNo. 2-11, not including outbuildings,
are structurally substandard to a degree requiring substantial renovation or clearance (See Appendix E).
2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be
expected to occur solely through private investment within the reasonably foreseeable future and that the
increased market value of the site that could reasonably be expected to occur without the use of tax
increment financing would be less than the increase in the market value estimated to result from the
proposed development after subtracting the present value of the projected tax increments for the maximum
duration of District No. 2-11 permitted by the Plan.
The proposed development, in the opinion of the City, would not reasonably be expected to occur solely
through private investment within the reasonably foreseeablefuture: This finding is supported by the fact
that the redevelopment proposed in this plan meets the City's objectives for redevelopment. Due to the
high cost of acquiring and redeveloping the parcels currently occupied by substandard buildings, which
parcels are under multiple ownership, the limited amount ofcommercial/industrial property for expansion
adjacent to the existingproject, the incompatible land uses at close proximity, and the cost of financing the
proposed improvements, this project is feasible only through assistance, in part, from tax increment
financing.
The increased market value of the site that could reasonable be expected to occur without the use of tax
incrementfrnancing would be less than the increase in market value estimated to resultfrom the proposed
development after subtracting the present value of the projected tax increments for the maximum duration
of the TIF District permitted by the Plan: The City supported this finding on the grounds that the cost of
site and public improvementsand utilities add to the total redevelopment cost. Historically, site and public
improvements costs in this area have made redevelopment infeasible without tax increment assistance.
Therefore, the City reasonably determines that no other redevelopment of any kind is anticipated on this
site without substantially sim filar assistance being provided to the development. Accordingly, the increased
market value anticipated without tax increment assistance is $0.
A comparative analysis of estimated market values both with and without establishment of Tax Increment
Financing District No. 2-11 and the use of tax increments has been performed as described above. If all
development which is proposed to be assisted with tax increment were to occur in District No. 2-11, the
total increased market value would be up to $58,192,400. The present value oftax incrementsfrom District
No. 2-11 is estimated to be $12,629,028. It is the Council's finding that no development with a market
value of greater than $45,563,372 would occur without tax increment assistance in this district within 25
years. This finding is based upon evidence from general past experience with the high cost of acquisition
N : \M innsota\HOPKI NS\Ti t2- I 1 \ctty_res. wpd
and public improvements in the general area of District No. 2-11 (see the Cashflows in Appendix C).
3. Finding that the Tax Increment Financing Plan for District No. 2-11 conforms to the general plan for the
development or redevelopment of the municipality as a whole.
The Plan was reviewed by the Planning Commission on September29, 1998. The Planning Commission
found that the Plan conforms to the general development plan of the City.
4. Finding that the Tax Increment Financing Plan for District No. 2-11 will afford maximum opportunity,
consistent with the sound needs of the City as a whole, for the development or redevelopment of
Redevelopment Project No. 1 by private enterprise.
The projects to be assisted by District No. 2-11 will be undertaken by private businesses, will result in
increased employment in the City and the State of Minnesota, the renovation of substandard properties,
increased tax base of the State and add high quality developments to the City.
N:\Minnsota\HOPKINS\Tit2-Il\ci[y res.wpd