City Council Resolution 2002-35Council member Bruce Thielen
CITY OF MONTICELLO
WRIGHT COUNTY
STATE OF MINNESOTA
introduced the following resolution and moved its adoption:
RESOLUTION NO. 2002-35
RESOLUTION ADOPTING A MODIFICATION TO THE REDEVELOPMENT
PLAN FOR CENTRAL MONTICELLO REDEVELOPMENT PROJECT NO. 11
AND ESTABLISHING TAX INCREMENT FINANCING DISTRICT NO. 1-30
THEREIN AND ADOPTING 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 Housing and Redevelopment Authority(the "HRA") has heretofore
established Central Monticello Redevelopment Project No. 1 and adopted a Redevelopment Plan therefor.
It has been proposed by the HRA and the City that the City adopt a Modification to the Redevelopment
Plan for Central Monticello Redevelopment Project No. 1 (the "Redevelopment Plan Modification") and
establish Tax Increment Financing District No. 1-30 (the "District") therein and adopt a Tax Increment
Financing Plan (the "TIF Plan") therefor (the Redevelopment Plan Modification and the TIF Plan are
referred to collectively herein as the "Plans"); all pursuant to and in conformity with applicable law,
including Minnesota Statutes, Sections 469.001 to 469.047 and Sections 469.174 to 469.179, all inclusive,
as amended, (the "Act") all as reflected in the Plans, and presented for the Council's consideration.
1.02. The City has investigated the facts relating to the Plans.
1.03. The HRA and City have performed all actions required by law to be perfonned prior to the
establishment of the District and the adoption and approval of the proposed Plans, including, but not limited
to, notification of Wright County and Independent School District No. 882 having taxing jurisdiction over
the property to be included in the District, a review of and written comment on the Plans by the City
Planning Corm-nission, and the holding of a public hearing upon published notice as required by law.
1.04. Certain written reports (the "Reports") relating to the Plans and to the activities
contemplated therein have heretofore been prepared by staff and submitted to the Council and/or made a
part of the City or HRA files and proceedings on the Plans. The Reports include data, information and/or
substantiation constituting or relating to the bases for the other findings and determinations made in this
resolution. The Council hereby confirms, ratifies and adopts the Reports, 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.
1.05. The City is not modifying the boundaries of Central Monticello Redevelopment Project
No. 1 but is, however, modifying the Redevelopment Plan therefor.
Section 2. Findings for the Adoption and Approval of the Plans.
2.01. The Council hereby finds that the Plans, are intended and, in the judgment of this Council,
the effect of such actions will be, to provide an impetus for development in the public interest and
accomplish certain objectives as specified in the Plans, which are hereby incorporated herein.
Section 3. Findings for the Establishment of Tax Increment Financing District No. 1-30.
3.01. The Council hereby finds that the District No. is in the public interest and is a "housing
district" under Minnesota Statutes, Section 469.174, Subd. 11.
3.02. The Council further finds that the proposed development would not occur solely through
private investment within the reasonably foreseeable future and that the increased market value 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 the District permitted by the Tax
Increment Financing Plan, that the Plans conform to the general plan for the development or redevelopment
of the City as a whole; and that the Plans will afford rnaxiinum opportunity consistent with the sound needs
of the City as a whole, for the development or redevelopment of the District by private enterprise.
3.03. The Council further finds, declares and deternvnes that the City made the above findings
stated in this Section and has set forth the reasons and supporting facts for each determination in writing,
attached hereto as Exhibit A.
Section 4. Public Purpose
4.01. The Plans conform in all respects to the requirements of the Act and will help fulfill a need
to develop an area of the City which is already built up, to provide employment opportunities, to improve
the tax base and to improve the general economy of the State and thereby serves a public purpose.
Section 5. Approval and Adoption of the Plans.
5.01. The Plans, as presented to the Council on this date, including without limitation the
findings and statements of objectives contained therein, are hereby approved, ratified, established, and
adopted and shall be placed on file in the office of the Executive Director of the HRA.
5.02. The Auditor of Wright County is requested to certify the original net tax capacity of the
District, as described in the Plans, and to certify in each year thereafter- the amount by which the original
net tax capacity has increased or decreased; and the HRA is authorized and directed to forthwith transnvt
this request to the County Auditor in such form and content as the Auditor may specify, together with a list
of all properties within the District, for which building permits have been issued during the 18 months
immediately preceding the adoption of this resolution.
5.03. The City Clerk is further authorized and directed to file a copy of the Plans with the
Commissioner of the Minnesota Department of Revenue pursuant to Minnesota Statutes 469.175, Subd.
4a.
The motion for the adoption of the foregoing resolution was duly seconded by Council member
Roger Carlson , and upon a vote being taken thereon, the following voted in favor thereof:
Roger Belsaas, Roger Carlson, Clint Herbst, Brian Stumpf and Bruce Thielen.
and the following voted against the same:
None
Dated: June 24, 2002
Ma r
(Seal)
ATTEST:
City Clerk
EXHIBIT A
RESOLUTION # 2002-35
The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan (the
"Plan") for Tax Increment Financing District No. 1-30 (the "District), as required pursuant to Minnesota Statutes,
Section 469.175, Subdivision 3 are as follows:
1. Finding that Tax Increment Financing District No. 1-30 is a housing district as defined in M.S., Section
469.174, Subd. 11.
The District No. 1-30 consists of five parcels. The development will consist of eleven owner -occupied
homes to be purchased by persons or families with incomes below 100% to 115% of the metropolitan- area
median income. Due to the involvement of the non-profit developer, it is expected that the incomes will
be less than 80% of median income. The market value of non -assisted housing or commercial property will
be less than 20 percent of the total fair market value of the planned improvements. Appendix E of the Plan
contains background for the above finding.
2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be
expected to occur solely through private investment within the reasonably foreseeable facture and that the
increased inarket 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 the District permitted by the Plan.
The proposed development, in the opinion of the City, would not reasonably be expected to occur solely
through private investment within the reasonably foreseeable future: This finding is supported by the fact
that the development proposed in this Plan is a housing district that meets the City's objectives for
development and redevelopment. The cost of land acquisition and site improvements and utilities makes
this housing development infeasible without City assistance. Due to the high cost of building affordable
new housing in the City and the cost of financing the redevelopment of existing structures, this project is
feasible only through assistance, in part, from tax increment financing. The developer was asked for and
provided a proforma as justification that the developer would not have gone forward without tax increment
assistance (see attachment in Appendix F of the Plan).
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 market value estimated to result from the proposed
development after subtracting the present value of the projected tax increments for the m.axim.um duration
of the District permitted by the Plan: This finding is justified on the grounds that the cost of land
acquisition, site and public improvements and utilities add to the total development cost. Historically, site
development costs in this area have made development infeasible without tax increment assistance. This
site has been targeted for redevelopment for several years without success. Therefore, the City reasonably
determines that no other development of similar scope is anticipated on this site without substantially
similar assistance being provided to the development.
A comparative analysis of estimated market values both with and without establishment of the District and
the use of tax increments has been performed as described above. If all development which is proposed
to be assisted with tax increment were to occur in the District, the total increase in market value would be
up to $1,107,700. The present value of tax increments from the District is estimated to be $202,429. It
is the Council's finding that no development with a market value of greater than $905,271 would occur
without tax increment assistance in this district within 25 years. This finding is based upon general past
experience with the high cost of acquisition and site improvements in the general area of the District (see
Cashflow in Appendix D of the Plan).
3. Finding that. the Plan for the District .conforms to the general plan for the development or redevelopment
of the municipality as a whole.
The Planning Commission reviewed the Plan and found that the Plan conforms to the general development
plan of the City.
4. Finding that the Tax Increment Financing Plan for Tax Increment Financing District No. 1-30 will afford
maximum opportunity, consistent with the sound needs of the City as a whole, for the development or
redevelopment of Central Monticello Redevelopment Project No. I by private enterprise.
Through the implementation of the Plan, the HRA or City will provide an impetus for residential
development, which is desirable or necessary to satisfy an increased need for affordable housing within the
City.