HRA Resolution 2000-11HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF MONTICELLO, MINNESOTA
RESOLUTION NO. 00 -11
RESOLUTION AMENDING THE BUSINESS SUBSIDY CRITERIA
OF THE
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF MONTICELLO, MINNESOTA
WHEREAS, the Housing and Redevelopment Authority in and for the City of Monticello,
Minnesota, held a public hearing on September 8, 1999 and approved the Business Subsidy
Criteria for the Housing and Redevelopment Authority in and for the City of Monticello,
Minnesota, pursuant to Minnesota Statutes, Section 116J.993 through 1 161994; and
WHEREAS, the 2000 Minnesota Legislators enacted amendments to the Business Subsidies,
Minnesota Statutes, Section 116.J993 through 116.J995; and
WHEREAS, the Housing and Redevelopment Authority in and for the City of Monticello,
Minnesota, has performed all actions required by law to be performed prior to approval and
adoption the proposed amendments to the business subsidies, including the holding of a public
hearing upon published notice as required by Law. Public Hearing Date October 4, 2000.
NOW, THEREFORE, BE IT RESOLVED by the Housing and Redevelopment Authority in
and for the City of Monticello, Minnesota, that the business subsidy criteria, contained in Exhibit
A of this resolution are hereby approved and adopted and shall be placed on file at the Office of
the Housing and Redevelopment Authority, 505 Walnut Street, Suite 1, Monticello, Minnesota.
Dated: October 4, 2000
i
ATTEST:
's Chair
r
It's Executive Director
MONTICELLO
OUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF MONTIC ELLO, MINNESOTA
Business Subsidv Criteria
Public Hearing and Adoption the 8" day of September, 1999.
Public Hearing and Adoption of Amendments the 4" day of October, 2000.
1. PURPOSE
1:01 The purpose of this document is to establish the Housing and Redevelopment Authority's
criteria for granting of business subsidies, as defined in Minnesota Statutes 116J.993,
Subdivision 3, for private development. This criteria shall be used as a guide in
processing and reviewing applications requesting business subsidies.
1:02 The criteria set forth in this document are guidelines only. The Housing and
Redevelopment Authority- reserves the right in its discretion to approve business subsides
that vary from the criteria stated herein if the Housing and Redevelopment Authority
determines that the subsidy nevertheless serves a public purpose. The Authority will file
evidence of any deviation from these criteria with the Department of Trade and Economic
Development in accordance with Minnesota Statues, Section I I6J.994, Subd. Z.
1:03 The Housing and Redevelopment Authority may amend the business subsidy criteria at
any time. Amendments to these criteria are subject to public hearing requirements
pursuant to Minnesota Statutes, Sections 116J.993 through 116J.994.
2. STATUTORY LIMITATIONS
2:01 In accordance with the Business Subsidy Criteria, Business Subsidy requests must
comply with applicable State Statutes. The Housing and Redevelopment Authority
ability to grant business subsidies is governed by the limitations established in Minnesota
Statutes 116J.993 throucyh 116J.994.
Monticello City Hall, 505 Walnut Street, Suite 1, Monticello, MN 55362 -8831 • (763) 295 -2711 • Fax: (763) 295 -4404
Office of Public Works, 909 Golf Course Rd., Monticello, MN 55362 • (763) 295 -3170 • Fax: (763) 271 -3272
HRA Business Subsidy Criteria
3. PUBLIC POLICY REQUIREMENT
3:01 All business subsidies must meet a public purpose in addition to increasing the tax base.
Job retention may only be used as a public purpose in cases where job loss is imminent
and demonstrable.
4. BUSINESS SUBSIDY APPROVAL CRITERIA
4:01 All new projects approved by the Housing and Redevelopment Authority should meet the
following minimum approval criteria. However, it should not be presumed that a project
meeting these criteria will automatically be approved. Meeting these criteria creates no
contractual rights on the part of any potential developer or the Housing and
Redevelopment Authority.
4:02 The project must be in accord with the Comprehensive Plan and Zoning Ordinances, or
required changes to the plan and ordinances must be under active consideration by the
City at; the time of approval.
4:03 Business subsidies will not be provided to projects that have the financial feasibility to
proceed without the benefit of the subsidy. In effect, business subsidies will not be
provided solely to broaden a developer's profit margins on a project.
4:04 Prior to approval of a business subsidies financing plan and when deemed appropriate by
the Housing and Redevelopment Authority, the developer shall provide any required
market and financial feasibility studies, appraisals, soil boring, information provided to
private lenders for the project, and other information or data as requested.
4:05 A recipient of a business subsidy must make a commitment to continue operations at the
site where the subsidy is used for at least five years after the benefit date.
4:06 The Housing and Redevelopment Authority may determine after a public hearing that job
creation or retention is not a goal of the subsidy. In those cases, the recipient must
instead meet at least one of the following minimum requirements (in addition to all other
criteria in this document other thctn those relating to jobs and minimum wages):
(1) The proposed subsidy must accomplish removal, rehabilitation or
redevelopment of "blighted areas" as defined in Minnesota Statues. Section 469.002,
Subd. 11, or must constitute a cost of correctinya conditions that allow designation of
redevelopment districts under Minnesota Statutes, Sections 469.174 to 469.179, or
HRA Business Subsidv Criteria
(2) The proposed subsidy must result in improvements to public infrastructure or
public facilities, including without limitation, sewers, storm sewers, streets, parks,
recreational facilities, and other City facilities; or
(3) The proposed subsidy must remove physical impediments to development of
land, including without limitation poor soils, bedrock conditions, steep slopes, or similar
geotechnical problems.
4:07 For any business subsidy that does not meet the requirements of Section 4:06, the
recipient must create or retain jobs as determined by the Housing and Redevelopment
Authority, and must meet the minimum wage thresholds described in Section 5:03 C or D
(whether or not the source of the subsidy is tax increment financing).
5. TAX INCREMENT PROJECT EVALUATION CRITERIA
5:01 The Housing and Redevelopment Authority will utilize Tax Increment Financing to
support the community's long -term economic, redevelopment, and housing goals.
5:02 Each Tax Increment Financing subsidy will be analyzed and evaluated by the Housin <-1
and Redevelopment Authority. Each project shall be measured against the general
criteria in Sections I through 6 and the specific criteria in this Section 5 applicable to tax
increment financing business subsidies.
5:0' ) Following are the evaluation criteria that will be used by the Housing and Redevelopment
Authority.
A. All business subsidy requests shall meet the "but for" test. The "but for" test
means that the project would not develop solely on private investment in the
reasonable future. The developer shall provide findings for the "but for "' test.
B. Business subsidy requests should create the highest feasible number of jobs on
site from date of occupancy where deemed appropriate.
C. For manufacturing and warehousing business subsidy requests. at least 90% of the
jobs created must pay a wage of the higher of $9.00 per hour. or at least 160% of
the federal minimum wage requirement for individuals over the age of 20.
Annual written reports are required until termination date. Failure to meet the job
and wage level goals require partial or full repayment of the assistance with
interest.
D . For other business subsidy requests, jobs created must meet as a minimum the
federal minimum wage requirement. Annual written reports are required until
termination date. Failure to meet the job and wage level goals require partial or
J
HRA Business Subsidy Criteria
full repayment of the assistance with interest.
E. All business subsidy requests should create the highest possible ratio of property
taxes paid before and after redevelopment.
F. Business subsidy requests should facilitate redevelopment or elimination of
"substandard" or "blighted" areas where deemed appropriate.
G. Business subsidy requests should facilitate the "clean -up" of environmentally
unsound property where deemed appropriate.
H. Business subsidy requests should increase moderate priced housing options for
area residents where deemed appropriate.
I. All business subsidy requests should be deemed to promote additional desired
"spin -off" development.
J. All business subsidy requests should demonstrate "community involvement'
including demonstrated degrees of the various factors:
a) Local residency of the company's owners and employees, or
b) Local residency of the contractors involved in the project, or
C) Membership in local business organizations, or
d) Other similar factors.
6. PROCEDURES
* Meet with appropriate Staff to discuss the scope of the project, public
participation being required, and other information as may be necessary.
* The request shall be reviewed by Staff on a preliminary basis as to the feasibility
of the project.
* The project concept shall be placed on the Housing and Redevelopment. Authority
agenda for concept review. The applicant will make a presentation of the project.
Staff will present its findings.
* If the Housing and Redevelopment Authority's concept review is positive, Staff
will provide the City Council with an informational concept review.
* The applicant will execute and submit the Preliminary Development Agreement
accompanied by a non - refundable fee of $5,000.
* Building and site plans submitted to the Chief Building Official.
4
HRA Business Subsidy Criteria
` If Planning and Zoning Commission action is required, it will be necessary for the
applicant, at this time, to make application to the Commission.
Staff will authorize the following steps:
- Preparation for establishment of the Tax Increment Finance District and the Tax
Increment Financing Plan if required.
- Preparation of the Private Redevelopment Contract (Subsidy Agreement) based
upon agreed terms.
When action is required for the Tax Increment Finance Plan, Private
Redevelopment Contract, or Zoning /Ordinance; the Housing and Redevelopment
Authority, Commission, and City Council shall take appropriate action such as
public hearings and consideration of approvals.
Building permit issued after the Tax Increment Finance District and Plan is
approved by City Council, the Private Redevelopment Contract is executed by the
developer and the Housing and Redevelopment Authority, and the Building
Permit Fees are paid.
Eligible Tax Increment Finance expenditures: Lcrnd acquisition, site improvements, public
improvements, and demolition cincl relocation costs.
Tax Increment Finance time: Generally six to eight tiveeks f °om time of authorization to begin
drefting plan and contract.
Zoning /Ordinance time: Varies per project.
busub.crit