HomeMy WebLinkAbout11/20/2012 EDA MeetingCity of Apple
Va lev
NOTICE: The Apple Valley Economic Development Authority will hold a
Special meeting at the Municipal Center, on Tuesday,
November 20, 2012, at 7:00 p.m. to consider the items listed in the
following agenda:
1 Call to Order.
2 Approval of Agenda.
3 Approval of Minutes of November 8, 2012.
4 Adopt Resolution Requesting Reimbursement for Bluewater Aquatic Center, 5885 —
149th Street W.
5. Adopt Resolution Approving Amendments to Master Development Program, the
Establishment of Tax Increment Financing District No. 15 and Approving the Tax
Increment Financing Plan Therefor.
6 Project Updates:
7 Other Items
8 Adjourn
ECONOMIC DEVELOPMENT AUTHORITY MEETING
TENTATIVE AGENDA
NOVEMBER 20, 2012 — 7:00 P.M.
(immediately following the City Council meeting)
(Agendas are also available on the City's Internet Web Site http://www.cityofapplevalley.org)
ECONOMIC DEVELOPMENT AUTHORITY
City of Apple Valley
Dakota County, Minnesota
November 8, 2012
Minutes of the special meeting of the Economic Development Authority of Apple Valley, Dakota
County, Minnesota, held November 8, 2012, at 7:00 o'clock p.m., at Apple Valley Municipal
Center.
PRESENT: President Severson, Commissioners Bergman, Goodwin, Grendahl, Hamann-
Roland, and Hooppaw.
ABSENT: None
City staff members present were: Executive Director Lawell, City Attorney Dougherty, Associate
City Planner Bodmer, Associate City Planner Dykes, Finance Director Hedberg, City Planner
Lovelace, Community Development Director Nordquist, and Department Assistant Murphy.
APPROVAL OF AGENDA
Meeting was called to order at 7:30 p.m. by President Severson.
MOTION: of Hamann-Roland, seconded by Bergman, approving the agenda. Ayes - 6 - Nays
-0.
APPROVAL OF MINUTES
MOTION: of Hamann-Roland, seconded by Goodwin, approving the minutes of the special
meeting of June 14, 2012, as written. Ayes - 6 - Nays - 0.
SUPPORT FOR MODIFICATION TO DAKOTA COUNTY COMMUNITY DEVELOPMENT
AGENCY (CDA)
Community Development Director Bruce Nordquist provided an overview of the request from the
Dakota County Community Development Agency (CDA) for support to modify the TIF Plan for
their District #3. He stated the District would decertify at the end of 2012 with a fund balance.
By modifying the District #3 Plan, the fund balance could be prioritized to acquire a site for transit
oriented and affordable housing near Cedar Avenue.
Andrea Brennen, Director of Community and Economic Development, Dakota County CDA,
provided additional information and stated the CDA is preparing for decertification of the district
which decertifies at the end of 2012.
Discussion followed.
MOTION: of Hamann-Roland, seconded by Goodwin, adopting Resolution No. EDA 12-12
approving authorization for the Dakota County Community Development Agency
to modify Tax Increment Financing District No. 3. Ayes - 6 - Nays - 0.
Economic Development Authority
City of Apple Valley
Dakota County, Minnesota
November 8, 2012
Page 2
REIMBURSEMENT AUTHORIZATIONS FOR BUSINESS ASSISTANCE PROGRAM
Associate Planner Margaret Dykes stated this is a request for reimbursement. The site at 7600 —
147th Street West had been vacant and needed repairs. The EDA approved a request for
assistance in June 2012 for up to $149,100 to help support substantial improvements that had been
made to the building.
Discussion followed.
MOTION: of Bergman, seconded by Goodwin, adopting Resolution No. EDA-12-13,
approving reimbursement of $149,100 to AV 147th Properties, LLC, to provide for
costs related to the completion of substantial construction at 7600 — 147th Street W.
Ayes - 6 - Nays - 0.
SET PUBLIC HEARING FOR BUSINESS SUBSIDY AGREEMENTS WITH IMH, LLC;
PARKSIDE VILLAGE DEVELOPMENT
Associate Planner Kathy Bodmer requested a public hearing be set for an upcoming December 13,
2012, meeting to consider a business subsidy for IMH LLC, in connection with the Parkside
Village development located on the northeast comer of Galaxie Avenue and 153rd Street West.
Discussion followed.
MOTION: of Hamann-Roland, seconded by Goodwin, setting a public hearing for December
13, 2012, to consider a business subsidy for IMH Special Asset NT 175-AVN,
LLC. Ayes - 6 - Nays - 0.
PROJECT UPDATES
Community Development Director Bruce Nordquist provided an overview of updates related to
the EDA and City powers.
Discussion followed.
MOTION: of Hamann-Roland, seconded by Bergman, recommending to the City Council the
appointment of Planning Commission Chair Tom Melander for the position on the
Economic Development Authority Board. Ayes - 6 - Nays - 0.
Mr. Nordquist continued with project updates relating to Bus Rapid Transit Oriented Development
Study, the upcoming Parkside Village schedule, and Open for Business program.
Discussion followed.
MOTION: of Grendahl, seconded by Hamann-Roland, to adjourn. Ayes - 6 - Nays - 0.
Economic Development Authority
City of Apple Valley
Dakota County, Minnesota
November 8, 2012
Page 3
The meeting was adjourned at 8:19 p.m.
Respectfully Submitted,
flt L,L
Jo,Murphy, Department sista
Approved by the Apple Valley Economic Development Authority on
City of Apple 1 ,
Valle)/
TO:
Executive Director
FROM: Margaret Dykes, Associate City Planner
MEETING
DATE: November 20, 2012
Attach ents: 1. Site Location Map
2. Reimbursement Request Form 4. Certificate of Occupancy
MEMO
Community Development Department
President and Board Members of the Economic Development Authority,
SUBJECT: Reimbursement to Bluewater Capital Management 11, LLC for Substantial Building
Improvements - 5885 -149 Street W.
Discussion
On June May 7, 2012, the EDA entered into a Development Agreement with Mr. Jim Wise who is the owner
of the building located at 5885-149 St. W. The Development Agreement approved financial support of
substantial building improvements needed to convert approximately 15,000 sq. ft. of the 41,500 sq. ft.
building into an aquatic training center that includes an 8-lane competition pool, bleachers, locker rooms, and
some office areas. The building, which was constructed in 1989, was mostly vacant and in need of interior
repairs prior to Mr. Wise's purchase of it. In order to renovate the building for the aquatic center, the roof
was removed and support structures widened to accommodate the in-ground pool. Additionally, damage
done to the building by previous occupants resulted in mold in some areas, which required removal of
interior walls in order to remediate the rnold. Upgrades were also made to the HVAC, electrical and
plumbing systems. The total expended for the aquatic center was $3.3 million, with $1,814,044 in
construction costs in addition to $1,500,000 for site acquisition. Mr. Wise had requested $149,900 in
assistance to defray some of the costs associated with the improvements. The funds for the assistance came
from changes to Tax Increment Financing (TIF) law that allowed the broad use of tax increment from any
TIF district to assist in the construction or rehabilitation of private development, and create jobs, both
temporary construction jobs and permanent jobs. Construction on any project receiving funds from this
program had to begin by July 1, 2012, and all expenditures needed to be completed by December 31, 2012.
The improvements listed in the Development Agreement have been completed, and Bluewater Aquatic
Center is now open. The Building Inspections division has issued a Certificate of Occupancy. Mr. Wise is
now requesting reimbursement of $149,900, and has submitted invoices and proof of payment of said
invoices. The Finance Director has reviewed the invoices and found them to be in order. The project has
created 23 permanent non-construction jobs and 254 construction jobs.
Recommended Action: If the EDA concurs, staff is recommending the following motion:
• Adopt the draft resolution approving the reimbursement of $149,900 to Bluewater Capital
Management II, LLC for the completion of substantial construction costs at 5885-149 Street W.
NOTE: Due to the large number of invoices, these are not attached to this memo but are available in
Planning Department or review.
3. Invoice and Payment List 5. Building Photos
b kLI
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. EDA-12-
A RESOLUTION AUTHORIZING THE MAKING OF REIMBURSEMENT
TO BLUEWATER CAPITAL MANAGEMENT II, LLC
WHEREAS, the Board of Commissioners of the Apple Valley Economic Development
Authority ("EDA") finds as follows:
1. That on December 20, 2011, the City Council approved a spending plan for TIF
District No. 13 (the "TIF District") in accordance with Minnesota Statutes, Section
469.176 Subd. 4m (the "Spending Plan") to utilize existing tax increment revenues
from the TIF District by December 30, 2012, in order to stimulate construction or
rehabilitation of private development in a way that will also create or retain jobs.
2. That Bluewater Capital Management II, LLC (the "Developer") requested assistance
from the EDA to support building renovations, construction and site improvements
consistent with the Spending Plan at property identified as the Lot 3, Block 1, North
Star Industrial Park (5885-149 St. W.).
3. That the EDA found it to be in the best interest of the EDA and City to utilize a
portion of the revenues from the TIF District to provide assistance to the Developer
for substantial building improvements, which include the construction of an eight-
lane competition pool, the removal and replacement of the roof, interior demolition of
existing walls, construction of locker rooms, classrooms, training rooms, and offices
as shown on the building plans submitted to the City on April 23, 2012.
4. That on May 7, 2012, the EDA and the Developer entered into a Development
Agreement and authorized the use of $149,900 for the substantial building
improvements listed in the Development Agreement.
5. That the Developer has completed the building improvements, received a Certificate
of Occupancy from the Building Official, and submitted proof of payment for the
work completed, which have been reviewed by the City Finance Director and found
to be in order.
6. That 23 permanent jobs and 254 construction jobs were created as a result of the
project.
7. That the Developer is now requesting reimbursement in the amount of $149,900.
NOW, THEREFORE, the EDA hereby authorizes the reimbursement of $149,900 to the
Developer pursuant to the Development Agreement.
D AFT
ATTEST:
ADOPTED this 20 day of November, 2012.
Pamela J. Gackstetter, Secretary
Larry S. Severson, President
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Nov. 2, 2012
Rob Carlson Builders
1680 -A 99th Lane NE
Blaine, MN 55449
Gerdes Drywall
Ceilings Etc.
Bluewater Aquatic Center
5885 149th St. W, Apple Valley, MN 55124
List of Workers
Molin
! :Northern Fabricating
Aker Door
Kocher Konstruction
Carciofini
Glass & Mirror
Kate -Lo Tile
Block Works
Abbey Carpet
Contract Hardware
Custom Home Renewal!
JBT Blacktopping
Nordic Insulation
Bassing Electric
Infinity Scaffold
Rob Carlson Builders
!Flohr Remodeling
Bluewater Capital / Wise Swim School
,Total.
Lampert Architects
Ray Anderson Demo/ Dumpster Box Services
Zachman Precast
National Automatic Sprinkler
Fabcon
Berggren Steel
Arrow Lift
Braun Intertec
Mechanical Air Systems 9
1
Schwab Vollhaber 8
Kuehn Roof Systems 14
Kramer Mechanical 9
Joe Marier Construction 16
Kadlec Excavating
Global Specialty Products 28
# of workers
3
13
9
8
15
4
7
4
2
5
8
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4
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City of Apple ll
Valle
TO: Economic Development Authority, and
Tom Lawell, Executive Director
FROM: Ron Hedberg, Finance Director
DATE: November 16, 2012
DA 5
MEMO
Finance Department
SUBJECT: Adopt Resolution Approving Amendments to Master Development Program for
Master Development District, the Establishment of Tax Increment Financing
District No. 15 and Approving the Tax Increment Financing Plan Therefor
Introduction
The City Council has set November 20, 2012 as the date to conduct a public hearing to consider
amendments to the Master Development District to include a new district, TIF District #15 —
Parkside Village. Following the public hearing if the City Council adopts a resolution approving the
Tax Increment Financing Plan creating the new district, the EDA will be asked to consider action
approving the same Tax Increment Financing Plan.
Property owner, IMH Special Asset NT 176-AVN, (represented by Titan Development) has
submitted an application for Tax Increment Financing (TIF) assistance for their project named
Parkside Village in the Central Village Area. The project is located north and east of 153 Street and
Galaxie Ave. A construction start of spring, 2013 is planned. The Master Development District,
last amended February 22, 2012 should be amended to include any new districts.
The action requested creates the TIF District and provides the opportunity to give future
consideration of a development assistance agreement with the property owner. The TIF Plan
attached includes the amounts that would be generated over the maximum 25 year life of the
district. The current proposal would use approximately 51% of the potential increments
generated and the remaining amounts would be eligible for other TIF Eligible expenses. Eligible
used for the increment generated from this district would need to be used for eligible housing
expenses.
If the modifications are approved and district no. 15 is created, the Development Assistance
Agreement with the property owner would be brought back to the EDA at a future meeting.
Discussion:
The project includes the development of approximately 8 acres, which will be comprised of two
multifamily buildings, totaling 322 units. The total development costs are estimated to exceed
$35,000,000. The developer is seeking assistance of up to $6,486,000 to offset acquisition cost
including the installation of utilities and land improvements.
EDA
Establishing TIF 15 — Parkside Village
November 16, 2012
The TIF plan being evaluated would include a portion ($5,336,000 or 82.2%) to be set up as a pay as
you go TIF note with the remaining portion ( $1,150,000 or 17.8%) coming in the form of up front
TIF assistance. Both forms of assistance are to be provided or recovered through future TIF
collections. The available increment would be the amounts generated from the project less 10% to
provide for administrative costs incurred by the City and the amounts deducted by the State Auditor.
Based on the value of the development at $35,190,000 the project as contemplated would generate
tax increment of up to approximately $23,609,026 over the life of the District, with 10% being
retained by the City for administrative costs, the next 20% being retained by the City to recover the
upfront assistance and the remainder 70% being returned to the property owner in the form of pay as
you go assistance.
Staff Recommendation
Following the conclusion of the public hearing, Staff recommends the adoption of the attached
resolution approving modifications to the Master Development District including establishment
of a new TIF District 15 — Parkside Village.
Action Requested:
Adopt Resolution Approving Amendments to Master Development Program for Master
Development District, the Establishment of Tax Increment Financing District No. 15 and
Approving the Tax Increment Financing Plan Therefor
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO.
A RESOLUTION APPROVING AMENDMENTS TO MASTER DEVELOPMENT
PROGRAM, THE ESTABLISHMENT OF TAX INCREMENT FINANCING DISTRICT NO.
15 AND APPROVING THE TAX INCREMENT FINANCING PLAN THEREFOR
A. WHEREAS, the Apple Valley Economic Development Authority ( "EDA ") and
the City of Apple Valley, Minnesota (the "City ") have adopted a Master Development Program
and established the Master Development District and created Tax Increment Financing Districts
within the Master Development District and adopted Tax Increment Financing Plans with respect
to these Tax Increment Districts pursuant to Chapter 469 of the Minnesota Statutes in an effort to
encourage development and redevelopment of certain designated areas within the City, which
program, plans and districts have been amended from time to time; and
B. WHEREAS, it has been proposed that the City establish Tax Increment Financing
District No. 15 ( "TIF District No. 15") as a housing district and adopt a Tax Increment Financing
Plan therefor (the "TIF Plan ").
C. WHEREAS, the EDA has investigated the facts and have caused the Program and
TIF Plan to be prepared and has performed all actions required by law to be performed prior to
the approval of the Program and the TIF Plan; and
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the EDA
as follows:
1. The Program and the TIF Plan are hereby approved.
2. The EDA's Secretary is authorized and directed to file a copy of the Program and
the TIF Plan with the Commissioner of Revenue and the Office of the State Auditor.
The motion for adoption of the foregoing resolution was duly seconded by member
and, after full discussion thereof, and upon a vote being taken thereof, the
following voted in favor thereof:
and the following voted against same:
Adopted this 20th day of November, 2012.
Attest:
Secretary
5032043v1
Chair
This document was drafted by:
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Amendments Relating to the Apple Valley Master
Master Development District
of the
Apple Valley Economic Development Authority, Minnesota
Including Amendment of its Master Development Program
and
Establishment of Tax Increment Financing District No. 15 and
Approval of its Tax Increment Financing Plan
With Financial Information provided by:
November 20, 2012
Briggs and Morgan (MLI)
2200 First National Bank Building
332 Minnesota Street
Saint Paul, Minnesota 55101
Tel: (651) 808-6600
Fax: (651) 808-6450
Northland Securities, Inc.
45 South 7 Street
Suite 2000
Minneapolis, Minnesota 55402
SECTION I
AMENDMENT OF MASTER DEVELOPMENT PROGRAM FOR
APPLE VALLEY MASTER DEVELOPMENT DISTRICT
Section 1.01 Definitions. The terms defined below, for purposes hereof, shall have the
following respective meanings, unless the context specifically requires otherwise. As used
herein, the term "development" includes redevelopment, and the term "developing" includes
redeveloping.
"City" means the City of Apple Valley, Minnesota.
"Council" means the City Council of the City, its governing body.
"County" means Dakota County, Minnesota.
"EDA" means the Apple Valley Economic Development Authority.
"Enabling Act" means Minnesota Statutes, Sections 469.090 to 469.1082, and all powers
and statutes referenced therein, including Minnesota Statutes, Sections 469.001 through 469.047,
and 469.124 through 469.133, as amended.
"Master Development District" means the Apple Valley Master Development District, as
established on May 18, 1990, including without limitation the areas of the City encompassed
therein, and constituting initially a consolidation of Master Development District Nos. 1 and 2,
as said Master Development District has been or may be amended; as shown on Exhibit A
attached hereto.
"Master Development District No. 1" means that certain Master Development District of
the City established on October 14, 1982, pursuant to Council Resolution No. 1982-133, as
amended.
"Master Development District No. 2" means that certain Master Development District of
the City originally established as Master Development District No. 1 on July 14, 1983, pursuant
to Council Resolution No. 1983-99 (which Master Development District was redesignated from
"No. 1" to "No. 2" on September 13, 1984), as amended.
"Master Development Program" means the Master Development Program adopted on
May 18, 1990, for the development of the Master Development District, constituting initially an
integration of Master Development Program Nos. 1 and 2, as said Master Development Program
has been, is hereby or may be amended.
"Master Development Program No. 1" means the Master Development Program for
Master Development District No. 1, as originally adopted on October 14, 1982, pursuant to
Council Resolution No. 1982-133, as amended.
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1
"Master Development Program No. 2" means the Master Development Program for
Master Development District No. 2, as originally adopted on July 14, 1983, pursuant to Council
Resolution No. 1983-99, as amended.
"Project Area" means the real property within the City constituting the Master
Development District, which includes all areas within the corporate limits of the City.
"Public Costs" means the repayment of debt service on any Tax Increment Bonds, the
costs set forth in Sections 1.03, 2.05, 2.06 and 2.14 of the Tax Increment Financing Plan for Tax
Increment Financing District No. 15, and any other costs eligible to be financed by Tax
Increments under Minnesota Statutes, Section 469.176, Subdivision 4.
"State" means the State of Minnesota.
"Tax Increment District" means any tax increment financing district established pursuant
to the Tax Increment Act within the Master Development District, as amended.
"Tax Increment Act" means Minnesota Statutes, Sections 469.174 through 469.1794, as
amended.
"Tax Increment Bonds" means any tax increment bonds issued by the City to finance the
Public Costs of the Master Development District as stated in the Master Development Program
and in the Tax Increment Financing Plan for Tax Increment Financing District No. 15, and any
obligations issued to refund such bonds.
"Tax Increment Plans" means the respective tax increment financing plans adopted
pursuant to the Tax Increment Act for the Tax Increment Districts, respectively, as amended.
Section 1.02 Background and Purposes. The City established Master Development
District Nos. 1 and 2 and adopted their respective Master Development Program Nos. 1 and 2
pursuant to the Minnesota Municipal Master Development District Act, formerly codified as
Minnesota Statutes, Chapter 472A, and now codified in Minnesota Statutes, Sections 469.124
through 469.133, as amended, and the City established a certain Tax Increment District within
Master Development District No. 1 and adopted its Tax Increment Plan pursuant to the Tax
Increment Act. The City has also established Tax Increment Financing District Nos. 1 through
14 within Master Development District No. 2 and adopted their respective Tax Increment Plans
pursuant to the Tax Increment Act. Additional Tax Increment Districts have been established
within the Master Development District.
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On May 18, 1990, the following actions were taken by the City:
(1) The Master Development District was established as initially the
consolidation of Master Development District Nos. 1 and 2, each project area being
expanded to become coterminous with the other.
(2) The Master Development Program was adopted, constituting initially the
integration of Master Development Program Nos. 1 and 2.
2
( The Master Development District was enlarged and it was further
provided that such enlargement, together with every future enlargement thereof, would
constitute and be deemed to be an enlargement of both Master Development District Nos.
1 and 2.
(4) The Master Development Program was amended to include additional
public development goals, activities, and costs and it was further provided that said
amendment, together with every future amendment thereof, would constitute and be
deemed to be an amendment of both Master Development Program Nos. 1 and 2.
Pursuant to the Enabling Act, and pursuant to the Council's Resolution No. 1990-15,
adopted on January 11, 1990, the City established the EDA and, pursuant to the Council's
Resolution No. 1990-40, adopted on February 8, 1990, the City authorized the EDA to assume
the management, operation, control, and authority of the City's Master Development District
(including all Tax Increment Districts therein and their related Tax Increment Plans), as such
transfer and assumption are allowed and permitted pursuant to Minnesota Statutes, Section
469.094. On February 8, 1990, the EDA adopted its Resolution No. EDA-90-4, which accepted
such responsibility and control of the Master Development District, the Master Development
Program, and the Tax Increment Districts and Plans.
Subsequent to the establishment of the Master Development District and the adoption of
its Master Development Program, the EDA and the Council have approved a number of
amendments and supplements to the Master Development District, the Master Development
Program, and the Tax Increment Districts and Plans, respectively, including without limitation
certain amendments approved on December 10, 1992, pursuant to which the Master
Development Program was designated as and found to constitute a "redevelopment plan" within
the meaning of Minnesota Statutes, Section 469.002, Subdivision 16, and the Master
Development District was designated as and found to constitute a "redevelopment project"
within the meaning of Minnesota Statutes, Section 469.002, Subdivision 14. On March 11, 2010
the Master Development District was enlarged and the Master Development Program was
amended to reflect additional goals, objectives and activities.
Section 1.03 Amendment of Master Development Program. The Master Development
Program is hereby amended to include the estimated and additional public improvement and
development goals, activities and costs described in Section II. These costs are anticipated to be
made or incurred within the Project Area and financed in whole or in part by tax increment or
other revenues available to the EDA and/or the City.
In addition, the EDA intends to pay from available tax increment such qualifying
administrative costs as may be permitted by but subject to the applicable limitations provided in
the Tax Increment Act.
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3
SECTION II
THE TAX INCREMENT FINANCING PLAN FOR
TAX INCREMENT FINANCING DISTRICT NO. 15
Section 2.01 Parcel(s) to be Included in Tax Increment Financing District No. 15. Tax
Increment Financing District No. 15 is described on the attached Exhibit B and includes the
parcel identification number(s) or legal description and adjacent rights-of-way set forth on the
attached Exhibit B.
Section 2.02 Property to be Acquired. The City reserves the right to acquire any
property within Tax Increment Financing District No. 15.
Section 2.03 Statement of Objectives; Development Activity in the Master
Development District for Which Contracts Have Been Signed. Tax Increment Financing District
No. 15 is being established to achieve the objectives of the Master Development Program. The
City intends to enter into a development agreement with respect to the construction of a 322 unit
multifamily housing facility to be developed within Tax Increment Financing District No. 15 (the
"Project") designed for persons or families of low and moderate income. No contract has been
signed prior to the establishment of Tax Increment Financing District No. 15.
Section 2.04 Other Specific Development Expected to Occur within the Master
Development District. It is anticipated that development will occur within the Master
Development District. Additional development may occur in the Master Development District in
the future; however, no contracts have been entered into at this time with respect to such
development. The nature and timing of further development cannot accurately be predicted at
this time.
Section 2.05 Estimated Public Costs. The estimated total Public Costs to be paid from
Tax Increments is described in Exhibit C.
Section 2.06 Estimated Amount of Bonded Indebtedness. It is anticipated that Tax
Increment Bonds will not be issued to finance the estimated Public Costs of the Master
Development Program. The City intends to use tax increment financing to reimburse the
developer for a portion of the cost of the development property to be acquired for the Project and
on a pay-as-you-go basis to reimburse the developer for costs of site improvements related to the
Project. The City, however, reserves the right to issue bonds estimated not to exceed $6,500,000
to finance said project costs.
Section 2.07 Sources of Revenue. The revenues to pay the Public Costs of the Master
Development District are the proceeds of the Tax Increments, Tax Increment Bonds and any
other available sources of revenue, including interfund loans, which the City may apply to pay
Public Costs.
Section 2.08 Estimated Recent Net Tax Capacity. The estimated net tax capacity of all
taxable property in Tax Increment Financing District No. 15 as most recently certified by the
Commissioner of Revenue of the State of Minnesota, being the certification made in 2012 with
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4
respect to the net tax capacity of such property as of January 2, 2011, for taxes payable in 2012 is
estimated to be $25,393.
Section 2.09 Estimated Captured Net Tax Capacity and Computation of Tax Increment.
Each year the County Auditor will measure the amount of increase or decrease in the total net tax
capacity value of Tax Increment Financing District No. 15 to calculate the Tax Increments
payable to the City. In any year in which there is an increase in total net tax capacity in Tax
Increment Financing District No. 15 above the original net tax capacity, Tax Increments will be
payable to the City. In any year in which the total net tax capacity in Tax Increment Financing
District No. 15 declines below the net tax capacity, no net tax capacity will be captured and no
tax increment will be payable.
The County Auditor shall certify in each year after the date the original net tax capacity
was certified, the amount the net tax capacity has increased or decreased as a result of:
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(1) change in tax exempt status of property;
(2) reduction or enlargement of the geographic boundaries of the district;
( change due to stipulations, adjustments, negotiated or court-ordered
abatements;
(4) change in the use of the property and classification;
( change in state law governing class rates; and
(6) change in connection with previously issued building permits.
Upon completion of the development expected to occur in Tax Increment Financing
District No. 15 the City estimates the net tax capacity of taxable property in Tax Increment
Financing District No. 15 will be approximately $1,489,607.
The captured net tax capacity upon completion of development is expected to be
approximately $1,464,214. The Tax Increments may be captured for up to twenty-five (25)
years from receipt of the first Tax Increments or until the Public Costs described in the Tax
Increment Financing Plan have been paid. The City determines that 100% of the available
increase in net tax capacity from Tax Increment Financing District No. 15 shall be used for the
payment of Public Costs of the Master Development District in accordance with the Master
Development Program and Tax Increment Financing Plan.
Section 2.10 Type of Tax Increment Financing District. Pursuant to Section 469.174,
Subdivision 11 of the Act, the City has determined that Tax Increment Financing District No. 15
qualifies as a "housing district" because:
"Housing district" means a type of tax increment financing district which consists
of a project, or a portion of a project, intended for occupancy, in part, by persons or
families of low and moderate income, as defined in Chapter 462A, Title II of the National
Housing Act of 1934, the National Housing Act of 1959, the United States Housing Act
5
of 1937, as amended, Title V of the Housing Act of 1949, as amended, any other similar
present or future federal, state, or municipal legislation, or the regulations promulgated
under any of these acts. A district does not qualify as a housing district under this
subdivision if more than 20 percent of the square footage of buildings that receive
assistance from tax increments (including interest reduction, land transfers at less than the
City's cost of acquisition, utility service or connections, roads, parking facilities, or other
subsidies) consists of commercial, retail, or other nonresidential uses. Housing project
means a project, or portion of a project, that meets all the qualifications of a housing
district under this subdivision, whether or not actually established as a housing district.
The City will cause the Developer to comply with the income restrictions pursuant to
Minnesota Statutes, Section 469.1761. For residential rental property, the property must satisfy
the income requirements for a qualified residential rental project as defined in section 142(d) of
the Internal Revenue Code. The requirements of this subdivision apply for the duration of the tax
increment financing district.
Section 2.11 Duration of Tax Increment Financing District No. 15. The Act allows
"housing districts" to remain in existence for a period of 25 years from the receipt of the first Tax
Increments.
Section 2.12 Estimated Impact of Tax Increment Financing. The estimated impact of
Tax Increment Financing District No. 15 on the other taxing jurisdictions is set forth on Exhibit
D. In accordance with Minnesota Statutes, Section 469.175, Subdivision 1, clause (6),
alternative estimates of the impact have been made, assuming in one case that the captured net
tax capacity would be available without creation of the district and in the other case that none of
the captured net tax capacity would be available without creating the district. The details are set
forth on Exhibit F.
In accordance with Minnesota Statutes, Section 469.175, Subdivision 2, clause (b), the
fiscal and economic implications of the district are set forth on Exhibit E. The district will
contain approximately 322 multifamily rental housing units. The overall impact on the general
finances of the City, related to the District, is expected to be minimal. It is the opinion of the City
that police and fire protection services can be provided to the district with no identifiable budget
impacts or the direct need for any additional capital equipment. The existing sanitary sewer and
water systems of the City have adequate capacity to serve the development in the District. There
is no impact on the City's ability to issue future debt or on the City's debt limit.
Section 2.13 Cash Flow and Other Financial Analysis. See Exhibit G attached hereto.
Section 2.14 Use of Tax Increment. The City hereby determines that it will use 100%
of the captured net tax capacity of taxable property located in Tax Increment Financing District
No. 15 for the following activities:
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(1)
To pay principal and interest on the Tax Increment Bonds.
(2) To pay principal and interest on any loans, advances or other payments
made to the City or for the benefit of the Master Development District by the developer.
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(
District.
To finance or otherwise pay Public Costs of the Master Development
(4) To finance or otherwise pay premiums and other costs for insurance, credit
enhancement, or other security guaranteeing the payment when due of principal and
interest on the Tax Increment Bonds or bonds issued pursuant to the Tax Increment
Financing Plan or pursuant to Minnesota Statutes, Chapter 462C and Minnesota Statutes,
Sections 469.152 to 469.1655, as amended, or both.
( To accumulate or maintain a reserve securing the payment when due of
the principal and interest on the Tax Increment Bonds or bonds issued pursuant to
Minnesota Statutes, Chapter 462C and Minnesota Statutes, Sections 469.152 to 469.1655,
as amended, or both.
(6) To pay or finance Public Costs described in the Master Development
Program and Tax Increment Financing Plan.
( To finance other Public Costs as may be allowed by the Tax Increment
Financing Act.
These revenues shall not be used to circumvent levy limitations applicable to the City nor
for other purposes prohibited by Section 469.176, Subdivision 4 of the Tax Increment Financing
Act.
Section 2.15 Prior Planned Improvements. The City shall, after due and diligent search,
accompany its request for certification to the County Auditor with a listing of all properties
within Tax Increment Financing District No. 15 for which building permits have been issued
during the eighteen (18) months immediately preceding approval of the Tax Increment Financing
Plan by the City. The County Auditor shall increase the original net tax capacity of Tax
Increment Financing District No. 15 by the net tax capacity of the improvements for which the
building permit was issued.
Section 2.16 Modifications of Tax Increment Financing Districts. In accordance with
Minnesota Statutes, Section 469.175, Subdivision 4, any reduction or enlargement of the
geographic area of the Master Development District or Tax Increment Financing District No. 15,
increase in amount of bonded indebtedness to be incurred, including a determination to increase
the amount of capitalized interest on debt to be paid on the Tax Increment Bonds over the
amount shown in this Tax Increment Financing Plan, or to increase or decrease the amount of
interest on the debt to be capitalized, increase the portion of the captured net tax capacity to be
retained by the City, increase in total estimated Public Costs or designation of additional
property to be acquired by the City shall be approved upon the notice and after the discussion,
public hearing and findings required for approval of the Tax Increment Financing 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 net tax capacity by the county
auditor. If a housing district is enlarged, the reasons and supporting facts for the determination
that the addition to the district meets the criteria of Section 469.174, subdivision 11, must be
documented. The requirements of this paragraph do not apply if (1) the only modification is
7
elimination of parcels from the project or district and (2)(A) the current tax capacity of the
parcels eliminated from the district equals or exceeds the tax capacity of those parcels in the
district's original tax capacity or (B) the authority agrees that, notwithstanding Section 469.177,
subdivision 1, the original tax capacity will be reduced by no more than the current tax capacity
of the parcels eliminated from the district. The authority must notify the county auditor of any
modification that reduces or enlarges the geographic area of a district or a project area.
Section 2.17 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 (1) amounts paid for
the purchase of land; (2) 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 project; (3) relocation benefits paid to or services
provided for persons residing or businesses located in the project; (4) amounts used to pay
principal or interest on, fund a reserve for, or sell at a discount bonds issued pursuant to Section
469.178; or (5) amounts used to pay other financial obligations to the extent those obligations
were used to finance costs described in clauses (1) to (3). For districts for which the requests for
certifications were made before August 1, 1979, or after June 30, 1982, administrative expenses
includes amounts paid for services provided by bond counsel, fiscal consultants, and planning or
economic development consultants. No Tax Increments shall be used to pay any administrative
expenses for a project which exceed ten percent of the total expenditures authorized by the Tax
Increment Financing Plan or the total project costs, whichever is less.
Section 2.18 Limitation on Qualification of Property in Tax Increment Financing
Districts Not Subject to Improvement. Pursuant to Minnesota Statutes, Section 469.176,
Subdivision 6, "if, after four years from the date of certification of the original net 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 original net tax
capacity of that parcel shall be excluded from the original net 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
qualified improvement of a street adjacent to that parcel, in accordance with the tax increment
financing plan, the authority shall certify to the county auditor that the activity has commenced,
and the county auditor shall certify the net tax capacity thereof as most recently certified by the
commissioner of revenue and add it to the original net tax capacity of the Tax Increment
Financing District." The City must submit to the county auditor evidence that the required
activity has taken place for each parcel in the Tax Increment Financing District. The evidence
for a parcel must be submitted by February 1 of the fifth year following the year in which the
parcel was certified as included in the district.
Section 2.19 Excess Tax Increments. Pursuant to Minnesota Statutes, Section 469.176,
Subdivision 2, in any year in which the Tax Increments exceed the amount necessary to pay the
Public Costs authorized by the Master Development Program and Tax Increment Financing Plan,
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including the amount necessary to cancel any tax levy as provided in Minnesota Statutes, Section
475.61, Subdivision 3, the City shall use the excess amount to:
(1) prepay the outstanding Tax Increment Bonds;
(2) discharge the pledge of Tax Increments thereto;
(3) pay into an escrow account dedicated to the payment of the Tax Increment
Bonds; or
(4) return the excess to the County Auditor for redistribution to the respective
taxing jurisdictions in proportion to their respective tax capacity rates.
In addition, the City may, subject to the limitations set forth herein (in particular in
Section 2.25), choose to modify the Tax Increment Financing Plan as described in Section 11, in
order to finance additional Public Costs of the Master Development District.
Section 2.20 Administration of Tax Increment Financing District No. 15.
Administration of Tax Increment Financing District will be handled by the Executive Director of
the EDA.
The Tax Increments received as a result of increases in the net tax capacity of Tax
Increment Financing District No. 15 will be maintained in a special account separate from all
other municipal accounts and expended only upon municipal activities identified in the Master
Development Program and Tax Increment Financing Plan.
Section 2.21 Annual Disclosure and Financial Reporting Requirements. The City (by
August 15) shall publish an annual statement as required under Minnesota Statutes, Section
469.175, Subdivision 5 showing for Tax Increment Financing District No. 15 the information
required to be reported under Subdivision 6, paragraph (c), clauses (1), (2), (3), (11), (12), (18),
and (19); the amounts of Tax Increment received and expended in the reporting period; and any
additional information the City deems necessary.
In addition, pursuant to Minnesota Statutes, Section 469.175, Subdivision 5, the City
must provide the County Board, the County Auditor and the State Auditor on or before August 1
of the year in which the statement must be published a copy of the annual statement.
Pursuant to Minnesota Statutes, Section 469.175, Subdivision 6, the City must file with
the State Auditor on or before August 1, an annual financial report for Tax Increment Financing
District No. 15. The report shall also be filed by the City with the County Auditor. The report
shall:
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(1) Provide for full disclosure of the sources and uses of Tax Increments of
Tax Increment Financing District No. 15;
(2) Permit comparison and reconciliation with the affected City's accounts and
financial reports;
9
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( Permit auditing of the funds expended on behalf of Tax Increment
Financing District No. 15, including a single district that is part of a multidistrict project
or that is funded in part or whole through the use of a development account funded with
tax increments from other Tax Increment Financing Districts or with other public money;
and
(4) Be consistent with generally accepted accounting principles.
In addition, the report shall contain the following information:
( The original net tax capacity of Tax Increment Financing District No. 15
and any district under Section 469.177, Subdivision 1;
(6) The net tax capacity for the reporting period of Tax Increment Financing
District No. 15 and any subdistrict;
(
The captured net tax capacity of Tax Increment Financing District No. 15;
(8) Any fiscal disparity deduction from the captured net tax capacity under
Section 469.177, Subdivision 3;
(9) The captured net tax capacity retained for tax increment financing under
Section 469.177, Subdivision 2, paragraph (a), clause (1);
(10) Any captured net tax capacity distributed among affected taxing districts
under Section 469.177, Subdivision 2, paragraph (a), clause (2);
(11) The type of district;
(12) The date the City approved the Tax Increment Financing Plan and the date
of approval of any modification of the Tax Increment Financing Plan, the approval of
which requires notice, discussion, a public hearing, and findings under Section 469.175,
Subdivision 4, paragraph (a);
(13) The date the City first requested certification of the original net tax
capacity of Tax Increment Financing District No. 15 and the date of the request for
certification regarding any parcel added to the Tax Increment Financing District No. 15;
(14) The date the County Auditor first certified the original net tax capacity of
Tax Increment Financing District No. 15 and the date of certification of the original net
tax capacity of any parcel added to Tax Increment Financing District No. 15;
(15) The month and year in which the City has received or anticipates it will
receive the first increment from Tax Increment Financing District No. 15;
(16) The date Tax Increment Financing District No. 15 must be decertified;
10
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(17) For the reporting period and prior years of Tax Increment Financing
District No. 15, the actual amount received from, at least, the following categories:
(a) Tax Increments paid by the captured net tax capacity retained for
tax increment financing under section 469.177, Subdivision 2, paragraph (a),
clause (1), but excluding any excess taxes;
(b) Tax Increments that are interest or other investment earnings on or
from Tax Increments;
(c) Tax Increments that are proceeds from the sale or lease of
property, tangible or intangible, purchased by the City with Tax Increments;
(d) Tax Increments that are repayments of loans or other advances
made by the City with Tax Increments;
(f)
273.1384.
(e) bond proceeds; and
the market value homestead credit paid to the City under Section
(18) For the reporting period and for the prior years of Tax Increment
Financing District No. 15, the actual amount expended for, at least, the following
categories:
(a) acquisition of land and buildings through condemnation or
purchase;
(b) site improvements or preparation costs;
(c) installation of public utilities, parking facilities, streets, roads,
sidewalks, or other similar public improvements;
(d) administrative costs, including the allocated cost of the City; and
(e) for housing districts, construction of affordable housing;
(19) The amount of any payments for activities and improvements located
outside of the district that are paid for or financed with Tax Increments;
(20) The amount of payments of principal and interest that are made during the
reporting period on any nondefeased:
(a) general obligation tax increment financing bonds; and
(b) other tax increment financing bonds including pay-as-you-go
contracts and notes.
11
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(21) The principal amount, at the end of the reporting period, of any
nondefeased:
(a) general obligation tax increment financing bonds; and
(b) other tax increment financing bonds, including pay-as-you-go
contracts and notes.
(22) The amount of principal and interest payments that are due for the current
calendar year on any nondefeased:
(a) general obligation tax increment financing bonds; and
(b) other tax increment financing bonds, including pay-as-you-go
contracts and notes.
(23) If the fiscal disparities contribution under Chapter 276A or 473F for Tax
Increment Financing District No. 15 is computed under Section 469.177, Subdivision 3,
paragraph (a), the amount of total increased property taxes to be paid from outside Tax
Increment Financing District No. 15; and
(24) Any additional information the State Auditor may require.
IF THE CITY FAILS TO MAKE A DISCLOSURE OR SUBMIT A REPORT
CONTAINING THE INFORMATION REQUIRED BY AND WITHIN THE TIME
PROVIDED IN SECTION 469.175, SUBDIVISIONS 5 AND 6 THE STATE AUDITOR
SHALL NOTIFY THE COUNTY AUDITOR TO HOLD THE DISTRIBUTION OF TAX
INCREMENT FROM TAX INCREMENT FINANCING DISTRICT NO. 15.
Section 2.22 Reasonable Expectations. As required by the Tax Increment Financing
Act, in establishing Tax Increment Financing District No. 15, the determination has been made
that the anticipated development 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 Tax Increment Financing District No. 15 permitted by the Tax Increment
Financing Plan. In making said determination, reliance has been placed upon written
representations made by the developer to such effects and upon City staff awareness of the
feasibility of developing the project site. A comparative analysis of estimated market values
both with and without establishment of Tax Increment Financing District No. 15 and the use of
Tax Increments has been performed as described above. Such analysis is on file with the City,
and indicates that the increase in estimated market value of the proposed development (less the
indicated subtractions) exceeds the estimated market value of the site absent the establishment of
Tax Increment Financing District No. 15 and the use of Tax Increments.
12
Section 2.24 Economic Development or Job Growth; Business Subsidies; Reporting.
To the extent applicable, the City agrees to comply with Minnesota Statutes, Sections 116J.993
to 116J.997, which states that a local unit of government granting financial assistance to a
business for economic development or job growth purposes, including tax increment financing,
4996914v2
Section 2.23 Other Limitations on the Use of Tax Increment.
(1) General Limitations. All revenue derived from tax increment shall be
used in accordance with the tax increment financing plan. The revenues shall be used to
finance or otherwise pay public capital and administration costs pursuant to Minnesota
Statutes, Section 469.124 through 469.133, as amended. These revenues shall not be used
to circumvent existing levy limit law. No revenues derived from tax increment shall be
used for the construction, renovation, operation or maintenance of a building to be used
primarily and regularly for conducting the business of a municipality, county, school
district, or any other local unit of government or the state or federal government or for a
commons area used as a public park, or a facility used for social, recreational, or
conference purposes; this provision shall not prohibit the use of revenues derived from
tax increments for the construction or renovation of a parking structure or of a privately
owned facility for conference purposes.
(2) Restriction on Pooling. At least 80 percent of tax increments from the Tax
Increment Financing District No. 15 must be expended on activities in Tax Increment
Financing District No. 15 or to pay bonds, to the extent that the proceeds of the bonds
were used to finance activities within said district or to pay, or secure payment of, debt
service on credit enhanced bonds, provided that in the case of a housing district, a
housing project as defined in Minnesota Statutes, Section 469.174, Sub. 11, is deemed to
be an activity in the District, even if the expenditure occurred after five years. Not more
than 20 percent of said tax increments may be expended, through a development fund or
otherwise, on activities outside of Tax Increment Financing District No. 15 except to pay,
or secure payment of, debt service on credit enhanced bonds, provided that in the case of
a housing district, a housing project as defined in Minnesota Statutes, Section 469.174,
Sub. 11, is deemed to be an activity in the District, even if the expenditure occurred after
five years. For purpose of applying this restriction, all administrative expenses must be
treated as if they were solely for activities outside of Tax Increment Financing District
No. 15.
( Five Year Limitation on Commitment of Tax Increments. Tax increments
derived from Tax Increment Financing District No. 15 shall be deemed to have satisfied
the 80 percent test set forth in paragraph (2) above only if the five year rule set forth in
Minnesota Statutes, Section 469.1763, Sub. 3, has been satisfied; and beginning with the
sixth year following certification of Tax Increment Financing District No. 15, 80 percent
of said tax increments that remain after expenditures permitted under said five year rule
must be used only to pay previously committed expenditures or credit enhanced bonds as
more fully set forth in Minnesota Statutes, Section 469.1763, Sub. 5, provided that in the
case of a housing district, a housing project as defined in Minnesota Statutes, Section
469.174, Subd. 11, is deemed to be an activity in the District, even if the expenditure
occurred after five years.
13
must establish business subsidy criteria and approve a business subsidy agreement with the
business receiving tax assistance. Minnesota Statutes, Section 116J.993 requires a city providing
a business with a subsidy worth $25,000 to complete a subsidy approval process as described
below. Housing projects and many redevelopment projects are exempt from the requirements.
4996914v2
Before granting a business subsidy, the City must complete the following:
(1) Adopt criteria for awarding business subsidies following a public hearing.
(2) Enter into a subsidy agreement which must include the following
information and requirements:
(a) A description of the subsidy, including the amount and type of
subsidy, and type of district if the subsidy is a tax increment financing;
(b) A statement of the public purpose of the subsidy;
(c) Measurable, specific, and tangible goals for the subsidy;
(d) A description of the recipient's financial obligation if the goals are
not met.
(e) A statement of why the subsidy is needed.
(f) A commitment from the recipient to continue operations in the
jurisdiction where the subsidy is used for at least five (5) years after the benefit
date;
any;
(g) The name and address of the parent corporation of the recipient, if
(h) A list of all financial assistance by all grantors for the project; and
(i) A requirement for the recipient to provide the Authority and the
Department of Employment and Economic Development with annual information
regarding goals for two years after receiving the subsidy or until the goals are
achieved. The reports must be filed by March 1 for the prior year.
( If the business subsidy exceeds $150,000, the City must conduct a public
hearing on the subsidy, after providing at least ten (10) days published notice in the local
newspaper.
Section 2.25 Requirements for Agreements with Developers. Pursuant to Minnesota
Statutes, Section 469.176 Subd. 5, if more than 10% of the acreage of a project is to be acquired
by the City with proceeds from tax increment bonds then, prior to such acquisition, the City must
enter into an agreement for the development of the property. Such agreement must provide
recourse for the City should the development not be completed.
14
Section 2.26 County Road Costs. Pursuant to Minnesota Statutes, Section 469.175,
Subdivision 1 a, the County board may require the City to pay for all or part of the cost of County
road improvements if the proposed development to be assisted by Tax Increments will, in the
judgment 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 within five years under another County plan.
If the County elects to use Tax Increments to improve County roads, it must notify the City
within forty-five days of receipt of this Tax Increment Financing Plan.
Section 2.27 Green Acres. Tax Increment Financing District No. 15 does not contain
any parcel or part of a parcel that qualified under the provisions of Section 273.111 or 273.112
and Chapter 473H for taxes payable in any of the five calendar years before the filing of the
request for certification of the Tax Increment Financing District.
4996914v2
15
z
w
0
lIJ
J
J
111,' ,••
fitu rtinnmIrltitilMItiltttio
it• ••,. •
. ,
'41!•1111111111111111111 I 1 li14111-11111111111111111 I II fi gII IU 11 1 1 11 1,11111.1141011111111111111111.11.11.1.1111.AVE
Parcel identification number(s) of property, located in the above referenced Tax
Increment Financing District in the City of Apple Valley, Dakota County, Minnesota are
as follows:
4996914v2
EXHIBIT B
Description of Tax Increment Financing District No. 15
CITY OF APPLE VALLEY, MINNESOTA
01-75900-07-010
01-75900-02-010
01-75900-02-020
01-75900-02-030
01-75900-03-010
01-75900-08-010
CITY OF APPLE VALLEY TIF DISTRICT 15
TIF District 15
B-1
Legend
Bui Hogs
- Roads
Parks
Ponds
kCIA
Estimated Tax Increment Revenues (from tax increment generated by the district)
Tax increment revenues distributed from the county
Interest and investment earnings
Sales/lease proceeds
Market value homestead credit
Total Estimated Tax Increment Revenues
EXHIBIT C
Projected Tax Increment
City of Apple Valley, Minnesota
Tax Increment Financing District No. 15
Estimated Project/Financing Costs (to be paid or financed with tax increment)
Project costs
Land/building acquisition
Site improvements/preparation costs
Utilities
Other qualifying improvements
Construction of affordable housing
Small city authorized costs, if not already included above
Administrative costs
Estimated Tax Increment Project Costs
Estimated financing costs
Interest expense
Total Estimated Project/Financing Costs to be Paid from Tax Increment
Estimated Financing
Total amount of bonds to be issued
Note:
Figures have been rounded
4996914v2
C-1
Total
$23,609,000
$50,000
$0
$0
$23,659,000
$5,000,000
$11,103,000
$886,000
$0
$0
$0
$2,3 60,000
$19,349,000
$4,310,000
S23,659,000
$19,349,000
4996914v2
10/18/2012
EXHIBIT D
Apple Valley EDA
Tax Increment Financing District No. 15
Estimated tax Increments Over Maximum Life of District
City of Apple Valley
Apple Valley EDA
Tax Increment Financing District No. 15
Estimated Tax Increments Over Maximum Life of District
Parkside Village
Based on Pay 2012 Tax Rate = 109.532% 44.110% 31.426% 28.440% 5.556%
Estimated City County School Other
TIF Taxes New Base Captured Total TIF TIF TIF TIF
District Payable Tax Tax Tax Tax Related Related Related Related
Year Year Capacity Capacity Capacity Increment Share Share Share Share
2014 - 0 0 0 0 0 0
1 2015 170,464 (25,393) 145,071 158,900 63,991 45,590 41,258 8,061
2 2016 461,879 (25,393) 436,487 478,094 192,534 137,170 124,137 24,253
3 2017 484,973 (25,393) 459,581 503,389 202,721 144,428 130,705 25,535
4 2018 509,222 (25,393) 483,829 529,949 213,417 152,048 137,601 26,883
5 2019 534,683 (25,393) 509,290 557,837 224,648 160,050 144,842 28,297
6 2020 561,417 (25,393) 536,025 587,120 236,440 168,451 152,445 29,784
7 2021 589,488 (25,393) 564,096 617,866 248,823 177,273 160,429 31,341
8 2022 618,962 (25,393) 593,570 650,150 261,824 186,535 168,811 32,980
9 2023 649,911 (25,393) 624,518 684,048 275,475 196,261 177,613 34,699
10 2024 682,406 (25,393) 657,014 719,641 289,809 206,473 186,855 36,504
11 2025 716,526 (25,393) 691,134 757,014 304,859 217,196 196,558 38,401
12 2026 752,353 (25,393) 726,960 796,255 320,662 228,455 206,747 40,391
13 2027 789,970 (25,393) 764,578 837,459 337,255 240,276 217,446 42,482
14 2028 829,469 (25,393) 804,076 880,722 354,678 252,689 228,679 44,676
15 2029 870,942 (25,393) 845,550 926,149 372,972 265,722 240,474 46,981
16 2030 914,489 (25,393) 889,097 973,847 392,181 279,408 252,859 49,399
17 2031 960,214 (25,393) 934,821 1,023,930 412,350 293,777 265,863 51,940
18 2032 1,008,225 (25,393) 982,832 1,076,518 433,527 308,865 279,517 54,609
19 2033 1,058,636 (25,393) 1,033,243 1,131,734 455,764 324,707 293,854 57,409
20 2034 1,111,568 (25,393) 1,086,175 1,189,711 479,112 341,341 308,908 60,350
21 2035 1,167,146 (25,393) 1,141,753 L250,588 503,627 358,807 324,715 63,439
22 2036 1,225,503 (25,393) 1,200,111 1,314,508 529,369 377,147 341,311 66,681
23 2037 1,286,778 (25,393) 1,261,386 1,381,624 556,397 396,403 358,738 70,086
24 2038 1,351,117 (25,393) 1,325,725 1,452,096 584,777 416,622 377,036 73,661
25 2039 1,418,673 (25,393) 1,393,281 1,526,091 614,576 437,852 396,249 77,414
26 2040 1,489,607 (25,393) 1,464,214 1,603,786 645,865 460,144 416,423 81,354
Total 23,609,026 9,507,653 6,773,690 6,130,073 1,197,610
0 .
. NORTHLAND STRATEGIES
Special Pro.pacts 0
D-1
4996914v2
)/1872012
EXHIBIT E
Apple Valley EDA
Tax Increment Financing District No. 15
Impact On Other Taxing Jurisdictions
(Taxes Payable 2011)
City of Apple Valley
Apple Valley EDA
Tax Increment Financing District No. 15
Impact on Other Taxing Jurisdictions
(Taxes Payable 2012)
Parkside Village
ANNUAL TAX INCREMENT
Estimated Annual Captured Tax Capacity (Full Development) $1,464,214
Payable 2012 Local Tax Rate 109.532%
Estimated Annual Tax Increment $1,603,786
Percent of Tax Base
0 NORTHLAND STRATEGIES
Special Pfoi•cts Group
Net Tax Captured
Capacity Tax
(NTC) Capacity
Percent of
Total NTC
City of Apple Valley 46,491,474 1,464,214 3.15%
Dakota County 419,583,852 1,464,214 0.35%
Rosemount-Apple Valley-Eagan ISD 196 148,173,078 1,464,214 0.99%
Dollar Impact of Affected Taxing Jurisdictions
Net Tax Tax Added
Capacity % of Total Increment Local Tax
(NTC) Share Rate
City of Apple Valley 44.110% 40.271% 645,865 1.389%
Dakota County 31.426% 28.691% 460,144 0.110%
Rosemount-Apple Valley-Eagan ISD 196 28.440% 25.965% 416,423 0.281%
Other 5.556% 5.073% 81,355
Totals 109.532% 100.000% 1,603,787
NOTE NO. 1: Assuming that ALL of the captured tax capacity would be available to all taxing jurisdictions
even if the City does not create the Tax Increment District, the creation of the District will reduce tax
capacities and increase the local tax rate as illustrated in the above tables.
NOTE NO. 2: Assuming that NONE of the captured tax capacity would be available to the taxing jurisdiction
if the City did not create the Tax Increment District, then the plan has virtually no initial effect on the tax
capacities of the taxing jurisdictions. However, once the District is established, allowable costs paid from the
increments, and the District is terminated, all taxing jurisdictions will experience an increase in their tax
base.
4996914v2
EXHIBIT F
Apple Valley EDA
Tax Increment Financing District No. 15
Present Value Analysis As Required By
Minnesota Statutes 469.175(3)(2)
City of Apple Valley
Apple Valley EDA
Tax Increment Financing District No. 15
Present Value Analysis As Required By
Minnesota Statutes 469.175(3)(2)
Parkside Vilioge
1 Estimated Future Market Value w/ Tax Increment Financing 35,190,802
2 Payable 2012 Market Value 2,031,400
3 Market Value Increase (1-2) 33,159,402
4 Present Value of Future Tax Increments 12,396,164
5 Market Value Increase Less PV of Tax Increments 20,763,238
6 Estimated Future Market Value w/o Tax Increment Financing 6,879,041
7 Payable 2012 Market Value 2,031,400
8 Market Value Increase (6-7) 4,847,641
9 Increase in MV From TIF 15,915,597 2
1 Assume 5.O% annual appreciation over 25 year life of district.
2 Statutory compliance achieved if increase in market value from TIF (Line 9) is
greater than or equal to zero.
NORTHLAND STRATEGIES
Sp•eiol Peolects Group /18/2012 Page :
F-1
TF Taxes New
District Value Payable 'klx,
Year 'Year Capacity
1 2014 2015 170,464
2 2015 2016 461879
3 2016 2017 484,973
4 2017 2018 509,222
5 2018 2019 534,683
6 2019 2020 561,417
7 2020 2021 589,488
8 2021 2022 618,962
9 2022 2023 649,911
10 2023 2024 682,406
11 2024 2025 716,526
12 2025 2026 752,353
13 2026 2027 789,970
14 2027 2028 829,469
15 2028 2029 870,942
16 2029 2030 914,489
17 2030 2031 960,214
18 2031 2032 1,008,225
19 2032 2033 1,058,636
20 2033 2034 1,111,568
21 2034 2035 1,167,146
22 2035 2036 1,225,503
23 2036 2037 1,286,778
24 2037 2038 1,351,117
25 2038 2039 1,418,673
26 2039 2040 1,489,607
4996914v2
Tax Increment Financing District No. 15
Projected Tax Increment
Base Captured
Tax Tax
Capacity Capmity
(25.393) 145,071
(25,393"; 4M,487
(25,39.3) 459,581
(25.393 483,829
G1)3.333',::)3; 509,290
(25,393'; 536,025
(25,3': 564,096
(25393) 593,570
(2S3393) (24,518
City of Apple Valley
Apple Valley EDA
Tax Increment Financing District Nt. 15
Projected Tax increment
Parkside mbge
Assu 103.00% 10.00%
Original Estimated
Tax Tax
Rate increment
109.532
109.532%
109.532%
109.532%
109,532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
109.532%
657,014
691,134
726,960
764,578
804,076
845,550
889,097
934,821
982,832
1,033,243
1,086,175
1,141,753
1,200,111
1,261,386
1,325,725
1,393,281
EXHIBIT G
(22393) 1,464,214 109.532% 1,603,786
TOTAL = 23,609,026
G-1
158,9(10
478,094
503,389
529,949
557,837
587,120
617,866
650,150
684,048
719,641
757,014
796,255
837,459
880,722
926,149
973,847
1,023,930
1,076,518
1,131,734
1,189,711
1,250,588
1,314,508
1,381,624
1,452,096
1,526,091
City
(75,701)
(79, 626)
(83,746)
(88,072)
(92,615)
(07
ICey Mssj ,
1 Assumes estimated assessed market: value of $35M with 35% completed 2013, 100% completed 2014.
2 New housing district 20% units at 50% of median income.
3 Tax rate is based on certified payable 2012 rates.
4 Assumed 3% annual appreciation in value over 25 year life of district.
5 Increment collected for 25 years after first year of collection, total of 26 years.
6 PV calculated based on semi-annual paymets.
(536%
State
Auditor
Deduct Increment
(57):) 142,438
(1,725 5 ) 428,563
:1„, 812 ) 451,238
(1,908) 475,046
(2,008) 500,045
(2)14) 526,294
(2,224) 553,855
582,794.
613,181
645,086
678,587
713,763
750,698
789,479
830,200
872,956
917,851
964,991
1,014,486
1,066,457
1,121,027
1,178,325.
1,238,488
1,301,659
1,367,988
1,437,634
(2,867)
(3,015)
(3,17))
(3,334)
(3506)
(3,5)
(3,1'375)
(4,074)
(4,283)
(4,502)
(4,970
(5,228)
(5,494)
(5„774)
Available Total
Annual PV of Available
Tax Tax Inrement
(89, 21,163,131
147,778
575,145
1,007,619
1,445,292
1,888,078
2,336,010
2,789,095
3,247,341
3,710,757
4,179,355
4,653,147
5,132,347
5,616,371
6,105,837
6,600,561
7,100,564
7,605,868
8,116,493
8,632,465
9,153,806
9,680,544
10,212,71)6
10,750,318
11,293,412
11,842,017
12,396,164
CITY OF APPLE VALLEY
ORDER FOR SPECIAL BOARD MEETING
I, Larry S. Severson, President of the Apple Valley Economic Development
Authority (EDA), hereby order that a special Board meeting of the EDA be held at
Apple Valley Municipal Center, 7100 - 147th Street W., on Tuesday, the 20th day of
November, 2012, at 7:00 p.m., immediately following the City Council meeting, for
consideration of requesting reimbursement for Bluewater Aquatic Center and
approving amendments to Master Development Program, establishing Tax Increment
Financing District No. 15, approving the Tax Increment Financing Plan, and provide
other project updates.
In accordance with this order, the Secretary is requested to provide notice of
this meeting following the requirements of the By-laws.
DATED this 15th day of November, 2012.
on, President