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121007 EDA ~ CITY OF NEW HOPE EDA MEETING City Hall, 4401 Xylon Avenue North December 10,2007 EDA Meeting will commence upon adjournment of the City Council Meeting President Martin Opem Sr. Commissioner Andy Hoffe Commissioner Karen Nolte Commissioner Steve Sommer Commissioner Daniel Stauner 1. Call to order 2. Roll call 3. Approval of regular meeting minutes of November 26,2007 4. Public Hearing! Resolution modifying the restated redevelopment plan for redevelopment project no. 1 and the tax increment financing plans for tax increment financing districts nos. 85-1, 85-2 and 86-1 :). Adjournment EDA Minutes Regular Meeting CALL TO ORDER ROLL CALL APPROVE MINUTES IMP. PROJECT 697 Item 4 MOTION Item 4 EDA Meeting Page 1 CITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 November 26, 2007 City Hall President Opem called the meeting of the Economic Development Authority to order at 8:01 p.m. Present: Martin Opem Sr., President Andy Hoffe; Commissioner Karen Nolte, Commissioner Steve Sommer, Commissioner Daniel Stauner, Commissioner Staff Present: Kirk McDonald, Director of Community Development Curtis Jacobsen, Community Development Assistant Valerie Leone, City Clerk Steve Sondrall, City Attorney Motion was made by ComJ;nissioner Nolte, seconded by Commissioner Stauner, to approve the Regular Meeting Minutes of September 24, 2007. All present voted in favor. Motion carried. President Opem introduced for discussion Item 4, Motion authorizing payment of $24;415.83 to Moss & Barnett for legal fees related to a cost recovery claim against Unocal/Chevron (improvement project no. 697). President Opem stated the payment of $24;415.83 will be the final payment to Moss & Barnett. President Opem reported that the settlement from Unocal/Chevron was $270,000 which was approximately 50% of the soil contamination clean up costs. He noted the city paid approximately $70,000 in legal fees related to the cost recovery claim, and the city was pleased with the $270,000 settlement as the firm's original offer was only $3,000. Mr. Steve Sondrall, city attorney, explained that Moss and Barnett wrote off approximately $10,000 in prior legal fees and reduced their final bill by $2,512.13. Council Member Nolte asked that the city obtain any reports created by Mr. Ken Olson, Liesch & Associates, or by Moss & Barnett as the material should be considered city-owned documentation. Mr. Sondrall stated he would contact Moss & Barnett and request any documentation riot already on file with the city. Motion was made by Commissioner Nolte, seconded by Commissioner Stauner, authorizing payment of $24,415.83 to Moss & Barnett for legal fees November 26,2007 ADJOURNMENT EDA Meeting Page 2 related to a cost recovery claim against Unocal/Chevron (improvement project no. 697). All present voted in favor. Motion carried. Motion was made by President Opem, seconded by Commissioner Nolte, to adjourn the meeting. All present voted in favor. Motion carried. The New Hope EDA adjourned at 8:10 p.m. Respectfully submitted, ~~ Valerie Leone, City Clerk November 26, 2007 EDA Request for Action Originating Department Approved for Agenda Agenda Section Community Development By: Kirk Me Donald, City Manager Curtis Jacobsen, CD Specialist By: December 10, 2007 EDA Item No. 4 Resolution modifying the restated redevelopment plan for redevelopment project no. 1 and the tax increment financing lans for tax increment financinO' districts nos. 85-1, 85-2 and 86-1 Requested Action Staff requests that the Authority approve a resolution on the modification of the restated redevelopment plan to redevelopment project no. 1 and the tax increment financing (TIF) plans for tax increment financing districts nos. 85-1, 85-2 and 86-1. Policy/Past Practice It is a past practice of the Authority to make occasional modifications to TIF plans as required by state la\v and changing circumstances upon the advice of legal council. Background On October 22 the Council adopted a resolution calling for the public hearing that is scheduled for December 10, 2007. Upon advice from Krass Monroe it was determined that minor modifications were necessary to be compliant with changes in state lavv and that these modifications have to be made following the same procedure as was used when the dish-icts were originally set up. The purpose of these modifications are to get the budgets for the TIF Districts into sync \.vith the actual operation of the TIF Districts. Jim Casserly, Krass Monroe, will be in attendance to answer any questions you may have. Attachment(s) €I Resolution €I Krass .Monroe memo €I TIF plan and budget 85-1 e TIP plan and budget 85-2 €I TIF Ian and bud O'et 86-1 Motion by '-A] '7 ~ 1 () fL,CL Second by -f / "; <.J'&[) f.vI~ JV To: Cui.J2!1JC /'~ O? -0 cf I:\RFA \PLANNING\PLAl'JNING\Q & R. EDA modification ofTIF districts.doc Commissioner introduced the following resolution, the reading of which was dispensed with by unanimous consent, and moved its adoption: NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY COUNTY OF HENNEPIN STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION MODIFYING THE RESTATED REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO.1 AND THE TAX INCREMENT FINANCING PLANS FOR TAX INCREMENT FINANCING DISTRICTS NOS. 85-1, 85-2 AND 86-1 BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the New Hope Economic Development Authority (the "EDA"), as follows: Section 1. Recitals. 1.01. It has been proposed that the EDA approve and adopt the proposed modification to the Restated Redevelopment Plan (the "Restated Plan") for Redevelopment Project No. 1 (the "Project Area") reflecting increased project costs within the Project Area, pursuant to and in accordance with Minnesota Statutes, Sections 469.001 to 469.047,469.124 to 469.134 and 469.090 to 469.108, inclusive, as amended and supplemented from time to time. 1.02. It has been further proposed that the EDA approve and adopt the proposed modifications to the Tax Increment Financing Plans (the "Plans") for Tax Increment Financing Districts Nos. 85-1, 85-2 and 86-1 (the "Districts") reflecting increased project costs within the Districts and the Project Area, pursuant to and in accordance with Minnesota Statutes, Sections 469.174 to 469.1799 and 469.090 to 469.108, and Laws of Minnesota 2003, Chapter 21, Article 10, Section 10, inclusive, as amended and supplemented from time to time. 1.03. The EDA has caused to be prepared and has investigated the facts with respect thereto a modified Restated Plan for the Project Area and modified Plans for the Districts reflecting increased project costs within the Districts and the Project Area. 1.04. The EDA has performed all actions required by law to be performed prior to the approval and adoption of the modifications to the Restated Plan for the Project Area and the Plans for the Districts (collectively the "Plans"). 1.05. The EDA hereby determines that it is necessary and in the best interests of the City and the EDA at this time to approve and adopt the modifications to the Plans. Section 2. Findinqs. and the following voted against the same: Whereupon said resolution was declared duly passed and adopted, and was signed by the President and attested to by Executive Director. Adopted by the Commissioners of the EDA this day 2007. President ATTEST: Executive Director CERTIFICATION I, , Executive Director of the New Hope Economic Development Authority, County of Hennepin, State of Minnesota, do hereby certify that the foregoing is a true and correct copy of Resolution No. adopted by the EDA on the day of , 2007. Executive Director G:\WPDATA'N\NEW HOPE30\TIP,EDiI RESOLUTION.DOC 3 2.01. The EDA hereby finds that the assistance to be provided through the adoption and implementation of the Plans is necessary to assure the development and redevelopment of the Project Area. 2.02. The EDA hereby finds that the Plans conform to the general plan for the development and redevelopment of the City as a whole in that they are consistent with the City's comprehensive plan. 2.03. The EDA hereby finds that the Plans afford maximum opportunity consistent with the sound needs of the City as a whole for the development and redevelopment of the Project Area by private enterprise and it is contemplated that the development and redevelopment thereof will be carried out pursuant to redevelopment contracts with private developers. 2.04. The EDA hereby finds, determines and declares that the modification, approval and adoption of the Plans is intended and in its judgment the effect will be to promote the purposes and objectives specified in this Section 2 and otherwise promote certain public purposes and accomplish certain objectives as specified in the Plans. 2.05. The EDA hereby finds, determines and declares that the expenditure of tax increment within the Project Area serves a primarily public purpose. Section 3. Approvals and Adoptions. 3.01. The modification to the Restated Plan reflecting increased project costs within the Project Area is hereby approved and adopted by the Commissioners of the EDA and is forwarded to the New Hope City Council for public hearing, review and approval. 3.02. The modifications to the Plans for the Districts reflecting increased project costs within the Districts and the Project Area are hereby approved and adopted by the Commissioners of the EDA and are forwarded to the New Hope City Council for public hearing, review and approval. Section 4. Filing of Plans. 4.01. Upon approval and adoption of the Plans, the EDA shall cause said Plans to be filed with the Minnesota Department of Revenue, the Office of the State Auditor and Hennepin County. The motion for the adoption of the foregoing resolution was duly seconded by Commissioner , and upon vote being taken thereon the following voted in favor thereof: 2 KRASS MONROE James R. Casserly j casserly@krassmonroe.com Direct 952.885.1296 MEMORANDUM To: City of New Hope Attn: Kirk McDonald, City Manager Attn: Curtis Jacobsen, Community Development Specialist Attn: Julie Linnihan, Finance Manager From: James R. Casserly, Esq. Date: December 4, 2007 Re: Modification to Tax Increment Finance Districts 85-1, 85-2 and 86-1 Our File No.1 0048-30 In our review of New Hope's Tax Increment Financing Reports to the Office of State Auditor, we noted that the budgets for these three districts should be modified to reflect past and current expenses and potential future expenses. These modifications are necessary to more easily track EDA revenues and expenses. Because the City has an integrated program with a single project area, the expenses are authorized. However, for reporting purposes, the OSA wants to track revenues and expenses by each tax increment financing district. As a result, it is necessary to modify the budgets of these three individual districts to more clearly match the actual and projected revenues and expenses. Please note that the adoption of these resolutions do not: 1. Authorize any specific expense; 2. Authorize the issuance of any debt; or 3. Extend the duration of any district. Modifying a TIF district budget requires the same formality as adopting the original budget. As a result, the City is holding a public hearing and both the EDA and the City must adopt resolutions authorizing the changes. 8000 Norman Center Drive, Suite 1000 Minneapolis, Minnesota 55437-1178 TEL 952.885.5999 FAX 952.885.5969 www.krassmonroe.com Again, these changes are required to maintain integrity in the accounting and reporting systems. These modifications also continue the City's policy of treating its redevelopment activities in an integrated and coordinated manner. Let me know if you need any further information, and I plan on attending the public hearing to answer any questions that may arise. JRC/al G:\WPDATA\N\NEW HOPE\30\COR\lv1CDONALD JACOBSEN L1NNIHAN JRC 1.DOC DECEMBER 10, 2007 MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 85-1 I. INTRODUCTION On November 12, 1985, the City of New Hope (the "City") and the Housing and Redevelopment Authority in and for the City of New Hope (the "HRA") adopted a Redevelopment Plan, created Redevelopment Project No. 85-1, adopted a Tax Increment Financing Plan (the "TIF Plan") and created Tax Increment Financing District No. 85-1 (the "TIF District"). The Redevelopment Plan, Redevelopment Project No. 85-1, TIF Plan and TIF District were transferred on August 10, 1989, from the HRA to the New Hope Economic Development Authority (the "EDA"). The Redevelopment Plan and TIF Plan were subsequently modified on October 11, 1993 to reflect increased geographic area, increased project costs and increased bonding authority. On July 25, 1994 the Redevelopment Plan was included in an amendment called the Master Modification to the Redevelopment Plans and the Tax Increment Financing Plans (the "Master Modification"). This Master Modification combined the area within Redevelopment Project No. 85-1 with the areas of the EDA's other redevelopment projects. At this time the TIF Plan was also modified to reflect increased geographic area, increased project costs and increased bonding authority. The Master Modification and the TIF Plan were further modified on October 9, 1995, February 24, 1997, April 28, 1997, July 27, 1998, June 28, 1999 and September 9, 2002 to reflect increased geographic area, increased project costs and increased bonding authority. On December 8, 2003 the Redevelopment Plan (as included in the Master Modification) was restated, the Master Modification (including Redevelopment Project No. 85-1) was redesignated as Redevelopment Project No.1 (the "Project Area") and the TIF Plan was modified to reflect increased geographic area, increased project costs and increased bonding authority. The Restated Redevelopment Plan and TIF Plan were modified again to reflect increased geographic area, increased project costs and increased bonding authority on April 26, 2004, May 10, 2004, June 14, 2004 and August 23, 2004. The TIF District was originally created as a redevelopment district with a termination date of December, 2012. II. DESCRIPTION OF MODIFICATION The City and EDA are proposing to modify Exhibit I-A of the Restated Redevelopment Plan to reflect estimated revenues and costs of $3,700,000 for this TIF District as shown on the attached Exhibit A. III. STATEMENT OF NEED FOR MODIFICATION AND OBJECTIVES The City and EDA have created an integrated tax increment financing program whereby all tax increment financing districts (the "District" or "Districts") are located within a single project area called Redevelopment Project No.1 (the "Project Area"). This Project Area is governed by a single Redevelopment Plan. When a new District is created within the Project Area, the budgets of all existing Districts are modified to include the expenses of the newly created District. In order to assist the City, EDA and Office of the State Auditor identify the source of revenues for eligible expenditures, the City and EDA are modifying this TIF Plan for this TIF District. IV. ORIGINAL TIF PLAN DETERMINATION AND NO NEW IMPACT The determinations made in the original TIF Plan, except as herein amended, shall remain in full force and effect. In addition to the original determinations, the EDA at this time (i) anticipates no impact on City services due to the modification of the TIF District, (ii) has no plans to issue general obligation debt for project costs, and (iii) anticipates there will be no impact on its borrowing costs due to the modification of the TI F District. G:\\VPDATA\N\NEW HOPE\30\TlF\85.J TIFPLAN MODIFICATION.DOC Source of Funds Tax Increment Revenue Investment Earnings Bond Proceeds Loan Proceeds Special Assessments Sales/Lease Proceeds Loan/Advance Repayments Grants Other Transfers In Total Source of Funds Use of Funds Land/building acquisition Site Improvements/preparation costs Installation of public utilities Public Parking facilities Streets and sidewalks Public park facilities Social, recreational or conference facilities Interest reduction payments Bond principal payments Bond interest payments Loan principal payments Loan/note interest payments Administrative costs Other Transfers out Total Use of Funds TIF budgets. New Hope - 12-10.07.xls 1- A - 8 TIF No. 85-1 Cumulative Modified Budget 12/10/2007 $ 3,000,000 150,000 400,000 50,000 100,000 ------------------ $ 3,700,000 $ 800,000 900,000 200 J 000 633,104 400,000 400,000 300,000 66,896 ------------------ $ 3,700,000 o DECEMBER 10, 2007 MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 85-2 I. INTRODUCTION On December 23, 1985, the City of New Hope (the "City") and the Housing and Redevelopment Authority in and for the City of New Hope (the "HRA") adopted a Redevelopment Plan, created Redevelopment Project No. 85-2, adopted a Tax Increment Financing Plan (the "TIF Plan") and created Tax Increment Financing District No. 85-2 (the "TIF District"). The Redevelopment Plan, Redevelopment Project No. 85-2, TIF Plan and TIF District were modifjed on June 22, 1987 to reflect increased geographic area, increased project costs and increased bonding authority and were subsequently transferred from the HRA to the New Hope Economic Development Authority (the "EDA") on August 1 0, 1989. On July 25, 1994 the Redevelopment Plan was included in an amendment called the Master Modification to the Redevelopment Plans and the Tax Increment Financing Plans (the "Master Modification"). This Master Modification combined the area within Redevelopment Project No. 85-2 with the areas of the EDA's other redevelopment projects. At this time the TIF Plan was also modified to reflect increased geographic area, increased project costs and increased bonding authority. The Master Modification and the TIF Plan were further modified on October 9, 1995, February 24, 1997, April 28, 1997, July 27, 1998, June 28, 1999 and September 9, 2002 to reflect increased geographic area, increased project costs and increased bonding authority. On December 8, 2003 the Redevelopment Plan (as included in the Master Modification) was restated, the Master Modification (including Redevelopment Project No. 85-2) was redesignated as Redevelopment Project No.1 (the "Project Area") and the TIF Plan was modified to reflect increased geographic area, increased project costs and increased bonding authority. The Restated Redevelopment Plan and TIF Plan were modified again to reflect increased geographic area, increased project costs and increased bonding authority on April 26, 2004, May 10, 2004, June 14, 2004 and August 23, 2004. The TIF District was originally created as a redevelopment district with a termination date of December, 2012. II. DESCRIPTION OF MODIFICATION The City and EDA are proposing to modify Exhibit I-A of the Restated Redevelopment Plan to reflect estimated revenues and costs of $16,420,000 for this TIF District as shown on the attached Exhibit A. III. STATEMENT OF NEED FOR MODIFICATION AND OBJECTIVES The City and EDA have created an integrated tax increment financing program whereby all tax increment financing districts (the "District" or "Districts") are located within a single project area called Redevelopment Project NO.1 (the "Project Area"). This Project Area is governed by a single Redevelopment Plan. When a new District is created within the Project Area, the budgets of all existing Districts are modified to include the expenses of the newly created District. In order to assist the City, EDA and Office of the State Auditor identrfy the source of revenues for eligible expenditures, the City and EDA are modifying this TIF Plan for this TIF District. IV. ORIGINAL TIF PLAN DETERMINATION AND NO NEW IMPACT The determinations made in the original TIF Plan, except as herein amended, shall remain in full force and effect. In addition to the original determinations, the EDA at this time (i) anticipates no impact on City services due to the modification of the TIF District, (Ii) has no plans to issue general obligation debt for project costs, and (iii) anticipates there will be no impact on its borrowing costs due to the modification of the TIF District. G:\WPDA T A\N\NEW HOPEI30\TIF\85.2 TlF PLAN MODIFICA TION.DOC -i Source of Funds Tax Increment Revenue Investment Earnings Bond Proceeds Loan Proceeds Special Assessments Sales/Lease Proceeds Loan/Advance Repayments Grants Other Transfers In Total Source of Funds Use of Funds Land/building acquisition Site Improvements/preparation costs Installation of public utilities Public Parking facilities Streets and sidewalks Public park facilities Social, recreational or conference facilities Interest reduction payments Bond principal payments Bond interest payments Loan principal payments Loan/note interest payments Administrative costs Other Transfers out Total Use of Funds TIF budgets - New Hope - 12-10-07.xls 1- A - 9 TIF No. 85-2 Cumulative Modified Budget 12/10/2007 $ 10,500,000 1,050,000 3,000,000 600,000 250,000 420,000 600,000 -------------------- $ 16,420,000 $ 3,500,000 5,000,000 200,000 430,572 3,000,000 1,000,000 1,050,000 2,000,000 239,428 -------------------- $ 16,420,000 o DECEMBER 10, 2007 MODIFICATION TO THE TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 86-1 I. INTRODUCTION On June 23, 1986, the City of New Hope (the "City") and the Housing and Redevelopment Authority in and for the City of New Hope (the "HRA") adopted a Redevelopment Plan, created Redevelopment Project No. 86-1, adopted a Tax Increment Financing Plan (the ''TIF Plan") and created Tax Increment Financing District No. 86-1 (the "TIF District"). The Redevelopment Plan, Redevelopment Project No. 86-1, TIF Plan and TIF District were transferred on August 10, 1989, from the HRA to the New Hope Economic Development Authority (the "EDA"). On July 25, 1994 the Redevelopment Plan was included in an amendment called the Master Modification to the Redevelopment Plans and the Tax Increment Financing Plans (the "Master Modification"). This Master Modification combined the area within Redevelopment Project No. 86-1 with the areas of the EDA's other redevelopment projects. At this time the TIF Plan was also modified to reflect increased geographic area, increased project costs and increased bonding authority. The Master Modification and the TIF Plan were further modified on October 9, 1995, February 24, 1997, April 28, 1997, July 27, 1998, June 28, 1999 and September 9, 2002 to reflect increased geographic area, increased project costs and increased bonding authority_ On December 8, 2003 the Redevelopment Plan (as included in the Master Modification) was restated, the Master Modification (including Redevelopment Project No. 86-1) was redesignated as Redevelopment Project NO.1 (the "Project Area") and the TIF Plan was modified to reflect increased geographic area, increased project costs and increased bonding authority. The Restated Redevelopment Plan and TIF Plan were modified again to reflect increased geographic area, increased project costs and increased bonding authority on April 26, 2004, May 10, 2004, June 14, 2004 and August 23, 2004. The TIF District was originally created as a redevelopment district with a termination date of December, 2012. II. DESCRIPTION OF MODIFICATION The City and EDA are proposing to modify Exhibit I-A of the Restated Redevelopment Plan to reflect estimated revenues and costs of $8,545,000 for this TIF District as shown on the attached Exhibit A. Ill. STATEMENT OF NEED FOR MODIFICATION AND OBJECTIVES The City and EDA have created an integrated tax increment financing program whereby all tax increment financing districts (the "District" or "Districts") are located within a single project area called Redevelopment Project NO.1 (the "Project Area"). This Project Area is governed by a single Redevelopment Plan. When a new District is created within the Project Area, the budgets of all existing Districts are modified to include the expenses of the newly created District. In order to assist the City, EDA and Office of the State Auditor identify the source of revenues for eligible expenditures, the City and EDA are modifying this TIF Plan for this TIF District. IV. ORIGINAL TIF PLAN DETERMINATION AND NO NEW IMPACT The determinations made in the original TIF Plan, except as herein amended, shall remain in full force and effect. In addition to the original determinations, the EDA at this time (i) anticipates no impact on City services due to the modification of the TIF District, (ii) has no plans to issue general obligation debt for project costs, and (iii) anticipates there will be no impact on its borrowing costs due to the modification of the TIF District. G:\WPDATA\.N\NEW HOPE\30\TIF\86.i TIF PL^.N MODIFICATION. DOC Source of Funds Tax Increment Revenue Investment Earnings Bond Proceeds Loan Proceeds Special Assessments Sales/Lease Proceeds Loan/Advance Repayments Grants Other Transfers In Total Source of Funds Use of Funds Land/building acquisition Site Improvements/preparation costs Installation of public utilities Public Parking facilities Streets and sidewalks Public park facilities Social, recreational or conference facilities Interest reduction payments Bond principal payments Bond interest payments Loan principal payments Loan/note interest payments Administrative costs Other Transfers out Total Use of Funds TIF budgeis - New Hope - 12-10-07.xls I-A-10 TIF No. 86-1 Cumulative Modified Budget 12/10/2007 $ 5,200,000 780,000 1,765,000 800,000 $ 8,545,000 $ 500,000 1,900,000 500,000 671,905 1,765,000 1,323,750 520,000 1,341,912 22,433 ------------------ $ 8,545,000 o