City Council Agenda Packet 10-30-1989SPECIAL MEETING
MONTICELLO CITY COUNCIL
OCTOBER 30, 1989
5:00 PM
Mayor: Ken Maus
Council Members: Fran Fair, Warren Smith, Shirley Anderson, Dan Blonigen
1. Call to order.
2. PUBLIC REARING - Proposed Adoption of the Development Program For
Development District No. 1 and the Proposed Adoption of the Tax
Increment Financing Plan for Tax Increment Financing District No. 1-1,
of the City of Monticello.
3. Consideration of Resolution approving the establishment of the
Development Program for Development District No. 1, and the Tax
Increment Financing Plan for Tax Increment Financing District No. 1-1.
4. Adjournment.
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Special Council Agenda - 10/30/89
2. PUBLIC HEARING - Proposed Adoption of the Development Program For
Development District No. 1 and the Proposed Adoption of the Tax Increment
Financing Plan for Tax Increment Financing District No. 1-1 of the City of
Monticello.
3. Consideration of Resolution Approving the establishment of the Developinent
Program for Development District No. 1, and the Tax Increment Financing
Plan for Tax Increment Financing District No. 1-1. Q.0.)
A. REFERENCE AND BACKGROUND:
On Septeinber 25, 1989, Council approved the basic framework for use of tax
increment financing in conjunction with the development of an addition to
the Monticello Mall. Staff was directed to prepare a development program
and finance plan accordingly and submit said plans to the School District
and County for review. Councilmembers also received a copy of the TIF
plans. Please refer to your copy of the plan, as an additional copy is
not being included with this memo. If you should need another copy,
please contact Karen Doty.
On October 9, 1989, Council scheduled the public hearing on the proposed
adoption of said plans and submitted notices of the public hearing to the
general public and to the County and School District. Legal requirements
preliminary to adoption of the plans have now been met; however, the TIP
plan cannot be executed at this time because developer financing is not
yet arranged and because a developer agreement is not In place.
Developinent of the K -Mart addition to the ;null is on hold because Lincoln
Companies has been unable to obtain necessary financing. After speaking
With The Lincoln Coirpanies' officials, it is ury understanding that The
Lincoln Co;panies is actively pursuing financing options and remains
positive that the necessary financing will be obtained. I have been
informed also that problems in obtaining financing are not due to any
reluctance on the part of K-Ma;t to uign a lease agreement, as K—Mart has
not withdrawn its letter of intent. The Lincoln Co;rpantes requests that
the City adopt the TIP plans contingent on acquisition of financing and
subsequent execution of a developer agreement.
The developer agreement is designed to assure the City that funds expended
on TIP activities will be recovered through the tax revenue created by the
developnent. This is an Important doaurent that ;suet be executed prior to
fonml adoption of the TIP plans.
D. ALTERNATIVE ACTIONS:
1. Motion to approve the resolution establishing the Development Program
for Development District No. 1, and the Tax Increment Financing Plan
for Tax Increment Financing Diatrict No. 1-1, subject to execution of
developer agreement and secured developer's financing.
Special Council Agenda - 10/30/89
Under this alternative, the plan is placed on hold until The Lincoln
Companies obtains the necessary financing. Once the financing is
obtained, Lincoln Companies would enter into the developer agreement
with the City. At this point, the TIF plan would go into effect.
Approving the TIF plans contingent on execution of the developer
agreement will expedite the development by eliminating the need to
bring the utter back to Council. It could also be that the ability
of The Lincoln Companies to obtain necessary financing could be
improved if the TIF district and finance plan are in place.
However, this may jeopardize the time clock for collection of
increment. If the TIF Plan is approved and the project ,pit comrpleteJ
by January 1, 1991, the City runs the risk of not collecting the
projected total years of increment as allowed by State statutory.
Certification of a Tax Increment Economic District is either 10 years
from the date of TIF Plan adoption or 8 years from the date of County
certification.
2. Motion to deny adoption of resolutions.
This alternative should be selected if Council desires to change its
position with regards to the proposed use of TIF. If Council wishes
to reduce or increase the TIP funding level, the plans before you D
should not be adopted. With this alternative, a new set of plans
should be prepared outlining the new level of TIF funding, if any.
Please note that The Lincoln Coripanies has not asked that Council
reconsider the proposed level of TIP funding. It is not known to what
extent a reduction or elimination of the use of TIF and concurrent
time delays would jeopardize the project.
3. Motion to take no action on approving establislunent of the Development
Program for Development District No. 1, and The Tax Increment
Financing Plan for Tax Increment Financing District No. 1-1.
Under this alternative, the City Council would siirply open the public
hearing allowing for public commnent and discussion, and close the
public hearing, taking no action for approval of the said resolution.
The resolution approval would appear on the City Council agenda in the
future.
This would allow amnple time for negotiations and agreement of the
Developer's Agreement between The Lincoln Coirpanies and the city
staff; allows City Council time to review and approve the agreed upon
Developer's Agreement; allows City Council time to reconsider, if so
desired, the proposed level of TIP funding, allows The Lincoln
Coirpanies more time for financial approval; allows the City to be in
the driver's neat, and eliminates the City's risk of not collecting
the projected total years of increment for an economic district, yet,
meets the statutory requirements of a Public Hearing.
Special Council Agenda — 10/30/89
C. STAFF REM MlENDATION:
Staff recoutnends that Council select alternative 13, for reasons stated
above.
D. SUPPORTING DATA:
copy of the resolution for adoption.
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resolution, tilereading of— hich
consent, and moved its adoption,
CITY OF MONTICELLO
COUNTY OF WRIGHT
STATE OF MINNESOTA
RESOLUTION NO.
RESOLUTION APPROVING THE ESTABLISHMENT OF THE
DEVELOPMENT PROGRAM FOR DEVELOPMENT DISTRICT
NO. 1, AND THE TAX INCREMENT FINANCING PLAN
FOR TAX INCREMENT FINANCING DISTRICT NO. 1-1�
RELATING THERETO.
HE IT RESOLVED by the City Council (the *Council-) of
the City of Monticello, Minnesota (the "City"), as follows,
Section -1. Recitals.
1.01. It has been proposed that the city establish
Development District No. I and the Tax Increment Financing
Plan for Tax Increment Financing District No. 1-1 therein and
approve and adopt the proposed Tax Increment Financing Plan with
respect thereto, all pursuant to anti in accordance with Minnesota
Statutes, Sections 469.124 through 469.134, inclusive, and
Minnesota Statutes, Sections 469.174 through 469.179, inclusive.
1.02. The Council tins investigated the facts and hes
caused to be prepared a Development Program for Development
District No. 1, and describing the action to be undertaken by the
City to aid the development of Development District No. 1.
1.03. Tho City has performed all actionn required by
law to be performed prior to the astahl.ialiment of Development
District No. 1. and tiro adoption of the Tax Increment Financing
Flan for Tax Increment Financing District No. 1.1 relating
thereto.
Section 2. Findinas for the Hatablishment of
Development District No. l..
2.01. Tho Council hereby rinds that the eatablLshment
of the Development Program for. Development District No. I
and the establishment of the TAX Increment Financing Plan for
Tax Increment• Financing District No. 1-1 are intended and, in
the judgement of this Council, its effect will be, to provide
an impetus for commercial And Industrial development in
the City, to increaso employment, and otherwise promote certain
public purposes and accomplish certain objectives as apecified in
the Development: Program.
Section s. rima "p,
Increment Financing District Novi -1. -
3.01. The Council hereby finds that Tax Increment
Financing District No. 1-1 consists of a project, or a portion
of a project, not meeting the requirements found in the
definition of a redevelopment district, a housing district, or a
soils correction district, but which the Council finds to be in
the public interest becausee (a) it will discourage commerce,
Industry or manufacturing from moving their operations to another
states or (b) it will result in increased employment in the
municipalityi or (c) i It will result in the preservation and
enhancement of the tax base of the municipality.
3.02. The CouneLl 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 in deemed necessaryl that the Tax Increment
Financing Plan conforms to the general plan for the develop-
ment or redevelopment of the City as n wholer and that the
Tax Increment Financing Plan will afford maximum opportunity
consistent with the sounds needs of the City as a whole, for
the development of Tax increment Financing District No. 1.-1 by
private enterprise.
3.03. The Counci.i further finds that the establishment of
Tax Increment Financing District No. 1.1 to intended and, in the
judgement of this Council, its effect will be, to promote the
public purposee and accomplish the objectives specified in the
Tax Increment Financing Plan.
3.04. The Council further Linda, declares and deter-
mines that the City made the above findings stated in
Section 3 and has set forth the reasons and supporting facts
for each determination in writing, attached hereto ae
Exhibit A.
Section 4. Approval of the Development Proqram and
Tax Increment Financing Plan.
4.01.. The UoveLopment Program for Development. District No.
1, and the Tax increment Financing Plan for Tax Inceement
Financing District No. 1.-1 are hereby approved and adoptod And
shall be placed on file in tiro office of the Clerk at City Hell.
The motion for the adoption of the foregoing Etesolution
was duly seconded by councilmember , and
uppon vote being taken thereon, the following voted in favor
t4�eruof s
and the following voted against the same:
Dateds , 1989.
Mayor
ATTBSTt
Clerk
r
EXHIBIT A TO RESOLUTION NO.
The reasons and facto nupportiny the findings for the
establishment of the Tax Increment Financing Plan for Tax
Increment Financing District No. 1-1. as required pursuant to
Minnesota Statutes, Section 469.175, Subdivision 3, are as
follows:
1. Finding that Tax Increment Financing District No. 1-1
is an "economic development district" as defined In
Minnesota Statutes, Section 469.174, Subdivision 12.
Reese refer to Exhibit 11-13 of the Tax Increment
Financing Plan for Tax Increment Financing District
No, 1-1.
2. Finding that the proposed development, in the opinion of
the Council, would not occur Aolely through private in-
vestment within the reasonable foreseeable future anJ,
therefore, the use of tax increment finnncing is deemed
necessary.
City staff has reviewed the available financing coots
nAaocinted with this development. Due to the high COALS of
the public improvements, Live project would not be financially
feasible without the City's assistance.
3. Finding Lhgt the Tax Increment Financing Plan confurma
to the general plan for the development or redevelopment
of the municipality as a whole.
The Monl.icc,llo Planning Commission reviewed the Tax increment
Financing Finn for Tax Increment Financing District No. 1-1
on October 3, 1909, and doLermined that: the Tax Increment
Financing Plan Cor Tax Increment Financing District No. 1-1
conformn to the comprehensive plan of the City.
4. Finding that thn Tax Increment Financing Pian for Tax
Ineremont Financing District No. 1-1 will afford maximum
opportunity consistent with the sound needs of the City
no a whole, for the dsveloment of Development bietrict
No. 1 by private enterprise.
The project includes the construction of a K -Mart facility
north of Interstate 94. The Tax lncromont Financing funds
will be used to realign a collector street which the City
feels Is neceasary to improve safety and traffic flow.
STATE, OF MINNESOTA )
COUNTY OF WRiGHT )es.
CITY OF MONTICELLO 1
1, the undersigned, being the duly qualified Clerk of
the City of Monticello, Minnesota, Do HEREBY CERTIFY that 1
have carefully compared the attached and foregoing extract of
minutes of a meeting of the City council of said City held on the
date therein indicated with the original minutes thereof on file
in my office and that the same Is a full, true, and correct
transcript thereof insofar as said minutes relate to Resolution
No.
WITNESS my hand officially and the official seal of the
City this day of , 1989.
(SEAL)
A
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