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City Council Resolution 2022-44 (2)CITY OF MONTICELLO, MINNESOTA RESOLUTION NO. 2022-40 RESOLUTION ESTABLISHING AN ECONOMIC DEVELOPMENT TAX INCREMENT FINANCING DISTRICT WITHIN CENTRAL MONTICELLO REDEVELOPMENT PROJECT NO. 1 AND APPROVING A TAX INCREMENT FINANCING PLAN THEREFOR BE IT RESOLVED by the City Council (the "Council") of the City of Monticello, Minnesota (the "City"), as follows: Section 1. Recitals. 1.01 The Monticello Economic Development Authority (the "Authority") has proposed the establishment of Tax Increment Financing (Economic Development) District No. 1-44 (the "TIF District") within the previously established Central Monticello Redevelopment Project No. 1 (the "Redevelopment Project") and the adoption of the related Tax Increment Financing Plan (the "TIF Plan"), pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.174 through 469.1794, as amended (the "TIF Act"), Minnesota Statutes, Sections 469.001 to 469.047 and 469.090 to 469.1081, all inclusive, as amended (collectively, and together with the TIF Act, the "Act"), as reflected in that certain document, dated March 11, 2022, entitled "Tax Increment Financing Plan for Tax Increment Financing (Economic Development) District No. 1-44 Within Central Monticello Redevelopment Project No. 1" and presented for the Council's consideration. 1.02 The Council has investigated the facts relating to the establishment of the TIF District and the adoption of the TIF Plan. 1.03 On the date hereof, the Council conducted a public hearing relating to the TIF Plan and the establishment of the TIF District, at the views of all interested parties were heard at the public hearing; and 1.04 Except for approval of the TIF District by the Board of Commissioners of the Authority, the City has performed all actions required by law to be performed prior to the adoption and approval of the TIF Plan, including, but not limited to, delivery of the TIF Plan to the County Auditor and School District Clerk, a review of the TIF Plan by the City Planning Commission, and the holding of a public hearing thereon following notice thereof published in the City's official newspaper at least 10 but not more than 30 days prior to the public hearing. 1.05 The TIF Plan and certain information and material (collectively, the "Materials") relating to the TIF Plan and to the activities contemplated therein have heretofore been prepared and submitted to the Council and/or made a part of the City and Authority files and proceedings on the TIF Plan. The Materials include the tax increment application, project pro forma financial statement, project sources and uses and other information supplied by The Washburn Computer Group, Inc., a Minnesota corporation (or an affiliate thereof or entity related thereto, the "Developer"), as to the activities contemplated therein, and information constituting or relating to (1) why the assistance satisfies the so-called "but for" test and (2) the bases for the other findings and determinations made in this resolution. The Council hereby confirms, ratifies and adopts the Materials, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. 1.06 The Developer has proposed to acquire property within the TIF District and construct and equip thereon an approximately 45,000 square foot expansion to an existing 33,000 square foot building to be used for warehousing and distribution (collectively, the "Development") and has requested that the Authority provide tax increment assistance to pay a portion of the public development costs of the Development. At least 85% of the facility will be used for manufacturing, warehousing, distribution, or research, with less than 15% available for office or other space not related to such functions. Based on representations by the Developer and the Developer, the City finds that jobs will be created and maintained in this state, including construction jobs. Section 2. Findings for the Creation of the TIF District and Adoption and Approval of a TIF Plan Therefor. 2.01 The Council hereby finds that the land within the Redevelopment Project is proper and desirable to establish and develop within the City, its effect will be to carry out the objectives of the Redevelopment Plan for the Redevelopment Project (the "Redevelopment Plan") by creating an impetus for the development of a distribution, warehouse and related structures in the City, and otherwise promote certain public purposes and accomplish certain objectives as specified in the TIF Plan and the Redevelopment Plan. The Redevelopment Plan has been previously established by the City and the EDA and is not being expanded in connection with the establishment of the TIF District. 2.02 The Council hereby finds that the TIF District is in the public interest and is an "economic development district" within the meaning of Minnesota Statutes, Section 469.174, Subdivision 12, because it will discourage commerce and industry from moving their operations to another state, it will result in increased employment in the state, and it will result in capital investment in the City and therefore preserve and enhance the tax base in the state. 2.03 The Council hereby makes the following additional findings in connection with the TIF District. (a) The Council further finds that the proposed Development, in the opinion of the Council, would not occur solely through private investment within the reasonably foreseeable future and, therefore, the use of tax increment financing is deemed necessary. The specific basis for such finding being: The Developer has represented that it could not proceed with the proposed construction of the Development in the TIF District without tax increment assistance to offset the high cost of the land acquisition, site improvements and utility work necessary for the Development. The Developer has further represented that the expansion planned in the Development is necessary for the Developer to retain its current operations in the State, as well as to expand its business and increase jobs and the tax base in the State. MN190\172\788838.v1 (b) The Council further finds that the TIF Plan conforms to the general plan for the development or redevelopment of the City as a whole. The specific basis for such finding being: The TIF Plan conforms with the general development plan of the City and will generally complement and serve to implement policies adopted in the City's comprehensive plan. The Development is in accordance with the existing zoning for the property and the City's Planning Commission has determined that the Development is consistent with the comprehensive plan. (c) The Council further finds that the TIF Plan will afford maximum opportunity consistent with the sound needs of the City as a whole for the development of the TIF District by private enterprise. The specific basis for such finding being. The proposed Development will be used by the Developer, a private enterprise, for warehousing and distributing products and will afford maximum opportunity for the development of the applicable parcels consistent with the needs of the City. The Development will maximize the potential of an underutilized site and will increase the taxable market valuation of the City and the available warehouse and distribution facilities in the City. (d) For purposes of compliance with Minnesota Statutes, Section 469.175, Subdivision 3(b)(2)(ii), the Council hereby finds that the increased market value of the property to be developed within the TIF District that could reasonably be expected to occur without the use of tax increment financing is $100,861 (which projected increase is solely due to inflation), which is less than the increased market value estimated to result from the proposed development (i.e., approximately $3,583,004) after subtracting the present value of the projected tax increments for the maximum duration of the TIF District (i.e., approximately $491,545) which is approximately $3,091,459. Thus, the use of tax increment financing will be a positive net gain to the City, the School District, and the County, and the tax increment assistance does not exceed the benefit which will be derived therefrom. 2.04 The City elects to retain all of the captured tax capacity to finance the costs of the TIF District. 2.05 The Council further finds that the TIF Plan is intended and, in the judgment of the Council their effect will be to promote the public purposes and accomplish the objectives specified therein. Background information and facts supporting all the above findings are set forth in the TIF Plan which is hereby incorporated by reference into and made a part of this resolution. 2.06 The adoption of the TIF Plan conforms in all respects to the requirements of the Act. The TIF Plan will help facilitate development that will create new warehouse and distribution uses, provide employment opportunities, and improve the tax base. The City expressly finds that any private benefit to be received by a private developer is incidental, as the tax increment assistance is provided solely to make the development financially feasible and thus produce the public benefits described. Therefore, the City finds that the public benefits of the TIF Plan exceed any private benefits. MN190\172\788838.vl Section 3. Creation of the TIF District and Approval and Adoption of the TIF Plan. 3.01 Subject to approval of the TIF Plan by the Board of Commissioners of the Authority, the TIF District is hereby established and the TIF Plan, as presented to the City Council on this date, including without limitation the findings and statements of objectives contained therein, is hereby approved, ratified, established, and adopted and shall be placed on file in the office of the City Finance Director. Approval of the TIF Plan does not constitute approval of any project or a development agreement with any developer. City and Authority staff and consultants are authorized and directed to proceed with implementation of the TIF Plan and to transmit the request for certification of the TIF District to the Wright County Auditor in such form and content as the County Auditor may specify. The Wright County Auditor is requested to certify the original net tax capacity of the TIF District as described in the TIF Plan, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased in accordance with the Act. The County Auditor/Treasurer of the County is requested to certify the original net tax capacity of the TIF District, as described in the TIF Plan. 3.02 City staff, advisors, and legal counsel are authorized and directed to proceed with the implementation of the TIF Plan and to negotiate, draft, prepare, and present to the City Council for its consideration all further plans, resolutions, documents, and contracts necessary for this purpose. ADOPTED BY the City Council of the City of Monticello, Minnesota, this 11 th day of April, 2022. Lloyd Hilgart, Mayo ATTEST: a � t � r� C Je inifer Schreibe , City Clerk MN190\172\788838.vl