HRA Agenda 05-04-1994AGENDA
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
V Wednesday, May 4, 1994 - 7:00 p.m.
City Hall
MEMBERS: Chairperson Al Larson, Vice -Chairperson Ben Smith,
Everette Ellison, Tom St. Hilaire, and Brad Barger.
STAFF: Rick Wolfsteller, Jeff O'Neill, and 011ie Koropchak.
1. CALL TO ORDER.
2. CONSIDERATION TO APPROVE THE APRIL 6, 1994 HRA MINUTES.
3. CONSIDERATION TO REVIEW FOR APPROVAL THE REVISED AGREEMENT
BETWEEN PUBLIC RESOURCE GROUP, INC. AND THE HRA.
4. CONSIDERATION TO REVIEW FOR ACCEPTANCE THE YEAR-END NRA FUND
AND TIF -DEBT SERVICE FUND SUMMARIES.
9. CONSIDERATION TO APPROVE A WAIVER LETTER AMENDING THE PRIVATE
REDEVELOPMENT CONTRACT BETWEEN THE SCHULZ PROPERTIES AND THE
HRA.
6. CONSIDERATION TO APPROVE THE CERTIFICATE OF COMPLETION OF THE
PRIVATE REDEVELOPMENT CONTRACT BETWEEN THE H -WINDOW COMPANY
AND THE HRA.
7. CONSIDERATION OF HRA UPDATES:
a) Next HRA meeting, June 1, 1994 - Senior Housing
Proposals.
b) Potential TIF projects - Genereux expansion, Ron Musich,
Stoinwall, Inc., and Fluoroware, Inc. N w rap„
C) Outlot A, County Club Manor Update
a. OTHER BUSINESS.
9. ADJOURNMENT.
MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, April 6, 1996 - 7:00 p.m.
City Hall
MEMBERS PRESENT: Chairperson Al Larson, Vice -Chairperson Ben
Smith, Everette Ellison, Tom St. Hilaire, and
Brad Barger.
STAFF PRESENT: Rick Wolfsteller and 011ie Koropchak.
STAFF ABSENT: Jeff O'Neill.
GUESTS: Pat Pelstring and Lenny Kirscht, Public
Resource Group, Inc.
Steve Bubul, Holmes & Graven.
1. CALL TO ORDER.
Chairperson Larson called the HRA meeting to order at 7:05
p.m.
2. CONSIDERATION TO APPROVE THE MARCH 2. 1994 HRA MINUTES.
Ben Smith made a motion to approve the March 2, 1994 HRA
minutes. Brad Barger seconded the motion and with no
corrections or additions, the minutes were approved as
written.
3. CONSIDERATION TO REVIEW THE CONTRACT BETWEEN THE HRA AND
PUBLIC RESOURCE GROUP. INC.
Mr. Pelstring distributed a summary of 1993-94 hourly billings
to HRA members which were within proximity of the HRA totals.
Upon clairifying questions regarding billable and non -billable
consultant and marketing fees, coordination roles, etc., it
was suggested that the contract between the parties be
updated and for Mr. Pelatring and Koropchak to determine a
date to define administrative roles. Chairperson Larson
expressed an interest to be present. Tom St. Hiliare made e
motion authorizing the payment of the January. February, and
March PRG billings. Everette Ellison secundod the motion and
without further discussion the motion passed unanimously.
4. CONS;DERATION TO HEAR AND DISCUSS THE POWERS OF AN HRA AND
LEGAL CHANGES IN TAX INCREMENT FINANCING.
Koropchak informed HRA members that with several unresolved
development Issues within the City of Mo.., !cello. Chairperson
Page 1
Larson and herself invited HRA Attorney Bubul to this meeting
to discuss the powers of an HRA and legal changes in TIF.
This meant as an informative agenda item.
First, Attorney Bubul informed members that HRA's have a
maximun levy power of .0131% of the city's estimated market
value. It is not part of the truth -in -taxation process and
the City Council has the power to veto any HRA request. Levy
dollars generated can be expended on projects much the same as
TIF dollars for public purpose involving blight, housing,
infrastructure, land acquisition, administration, etc.;
however, do not need to satisfy the "but for" test. Examples
of who uses the levy power are Counties, and the Cities of
Brooklyn Park, Red Wing, and St. Cloud. The levy power Is
used more in the metro for housing project and is the
collateral for bonds or as development assistance. An NRA
must certify a budget prior to August 1. A levy gives an HRA
the means to acquire real estate; however, is an additional
tax levy.
Secondly, Mr. Bubul informed members that in the mid 90's the
State added the TIF Penalty which is the school aid
difference. Although property tax is increased, the school
aid is reduced. To compensate, the State takes away
approximately 30% of a City's LGA or HACA. Prior to August 1,
1993, a City's General Fund recovered its 30% loss through the
Private Redevelopment Contract either by a public improvement
loan to the developer or as a payback on a pay-as-you-go
assistance.
After July 31, 1993, a City's ability to recapture the penalty
loss became more restricted. An HRA can utilize 10% of
district's increment for administrative cost which can be
utilized by the City to recover a portion of the its 30% loss.
Or 25% of a TIF District's increment can be used outside the
district and within the Redeve'_opment Project area. The 25%
maximum increment must be a TIF -eligible activity, payments
depositod In the TIF District account and not depositod in the
City's general fund. This must be certified upon approval of
a TIF Plan.
Thirdly, Mr. Bubul outlined several TIF amendments being
considered by 96 Legislators. Most are considered positive
amendments by attorneys, one being the consideration to
oliminate the TIF Penalty on Economic District.
Page 2
HRA MINUTES
APRIL 6, 1996
It was suggested that Mr. Bubul talk with Public Resource
Group, Inc. to encourage communication and coordination
efforts between the financial consultant and the attorney
regarding of the estimated TIP Penalty calculation and its
relationship to the development of a TIF Plan or Private
Redevelopment Contract.
The HRA thanked Mr. Bubul for his time and shared knowledge.
CONSIDERATION FOR APPROVAL TO AMEND THE CONTRACT BETWEEN THE
HRA AND JAY MORRELL AND TO AMEND THE PURCHASE AGREEMENT
BETWEEN THE HRA AND RON AND DEE JOHNSON.
As per the request of Mr. Jay Morrell, the HRA agreed to serve
as a catalyst (gopher) at no expense to the HRA in an attempt
to acquire Lot 6, Block 3, OIP from Ron and Dee Johnson for
Morrell Is M & P Transport expansion. Previous direct attempts
by Mr. Morrell were unsuccessful. At no expense to the HRA,
a purchase agreement was prepared and submitted to the
Johnson, the expired purchase agreement has not been
returned. Although Mr. Morrell has expressed an interest of
a counter-offer, Tom St. Hilaire made a motion denying the
approval to amend the original contract between the HRA amd
Jay Morrell and the original purchase agreement between the
HRA and Ron and Dee Johnson. Ben Smith seconded the motion.
The NRA felt they acted In good faith, made a fair offer,
recognized the unsuccessful attempt of a willing seller/buyer
purchase agreement, and elected not to participate in any
historical property controversy. The motion passed
unanimously.
CONSIDERATION TO APPROVF A PRELIMINARY CONCEPT FOjt THE USE OF
TIF FOR THE GENERBUX FINE WOOD PRODUCTS EXPANSION.
Based on the estimated tax increment to be generated from a
19,000 sq ft building addition, the creation of 36 now jobs,
a 1996 expansion completion date, and to encourage existing
business expansions; Brad Barger made a motion approving the
use of additional TIF District 1-9 revenues for the proposed
Genereux expansion. This being preliminary concept approval
only, no exact dollars were deoignated for assiatance.
Everette Ellison seconded the motion and with no further
diocucalon, the motion passed unanimously. If expansion plans
proceed, the HRA will need to modify the Plan/Budget for TIP
District 1-9 and amend the existing Private Redevelopment
Contract.
Page 3
HRA MINUTES
APRIL 6, 1994
CONSIDERATION OF HRA UPDATES:
a) Custom Canopy, Inc. - It was reported that Mr. Birkeland
Jr. has taken positive steps to comply with the City
Ordinance; however, the TIF assistance is subject to
completion of the screening requirement by July 1, 1994.
b) Outlet A, Country Club Manor - Council has not reviewed
the returned multi -housing development request for
proposals. Upon Council selection of a developer and
prior to land purchase, the HRA will hold a public
hearing on the land acquisition.
c) Standard Iron Certificate of Completion - The company
moved in the end of March and has received a temporary
occupancy permit. The Certificate of Completion must be
approved by December, 1994.
d) Next HRA meeting, May 4, 1994.
OTHER BUSINESS.
By general consensus of its membership, the HRA made a
recommendation for the Planning Commission and City Council to
preserve the 160 -acre Klein parcel, directly south of the OIP,
for industrial use. Additionally, they recommended the City's
Comprehensive Guide Plan be reviewed and updated by an
independent/impartial planner and recommended the
authorization of a long-range land use study focusing on
freeway access and transportation circulation. The
recommendation was made to ensure that the City's land -use
plan supports the City's objectives.
An HRA member referred an industrial lead to Koropchak. A
plastic fabricator and thermoformer company with 12-18
employees looking to relocate from a metro Broadway/Central
area. John Dunbar, 379-2018.
ADJOURNMENT.
The HRA meeting adjourned at 10:20 p.m.
011ie Koropchak, H Executive Director
Page 4
HRA AGENDA
MAY 4, 1994
1
3. Consideration to review for aoproval the revised aareement
between Public Resource Groun. Inc. and the HRA.
A. Reference and Backaround.
Since the April HRA meeting, Pat Pelstring, Al Larson, and
Koropchak met to determine the administrative roles and the
scope and payment of services provided by PRG. The enclosed
agreement was prepared and submitted by PRG for HRA review and
approval.
In an attempt to assist the HRA, I highlighted some of the
scope of service changes made by PRG. Basically, the scope of
service Is more defined. Secondly, you will note the increase
in the hourly fee from $75 to $90/$110 and the ERG application
increase from not -to -exceed $3,500 to $4,000 which does not
Include administrative/reporting associated with the grant.
The TIF fee of $3,850 did not Increase. It has always been my
opinion, that the HRA's greatest need for PRG's service was in
the areas of credit analysis, financial review, packaging
structure and application preparation, and not for the
establishment of TIF Districts.
In an attempt to increase coordination of SBA financial
programs as utilized by our businesses, I have met with Mr.
Bob Alexander of Minnesota Business Finance, Inc. (previously
known as OMNI) and 8111 Enders of Marquette Bank - Monticello.
On May 4, I will tour their new St. Cloud office and will
attempt to learn the administrative steps for an SBA
application. According to Mr. Alexander, Deb Gusfafson of I'RG
does an excellent job with SBA applications; however, he noted
PRG is one of the moot expensive consultants.
In talking with Mr. Demeuleo of Standard Iron, costs
associated with finance applications, cloning documents, and
attorney fees are estimated to run the company well -over
$50,000.
B. Alternative Actions.
1. Motion to approve the Agreement between Public Resource
Group, Inc. and the NRA as submitted.
2. Motion to deny approval of the Agreement between Public
Reooureo Group, Inc. and the NRA as submitted.
3. Motion to table any action.
Pago 1
HRA AGE?'DA
MAY 4, 1994
C. Staff Recommendation.
If the HRA can justify the cost of PRG's service and its
benefit to Monticello businesses and the community, then staff
recommer,ds the HRA contract with PRG.
Supportinu Data.
Copy of the revised contract.
Page 2
PVaY-02-'`'.4 MON 1?:26 ID.BDS PC. TEL t-v—,e6-?B34 tte7 P02
PUBLIC RESOURCE
I
GROUP, INC.
Marludeg, Dfttf p me f! Fmom Spada (W
rp Holmtable Chairman Al IN=
Modaft Haring NW Redevekapauutt AudWRY
FROM: Ptttrkckt W. Pelt tang, CSO
Lorury P. Klrach4 Pmwm
DATE: Mty 2.1994
SIJB�TEC'T: iteviaadCantaaa
per our mwdq on ApM 6, 1994 and Patrick PdOinS't ud"Nuent r wft wilt M Lam sod
OUW Rte, we have prepmW the satndW revised cont:W bet~ the Maeaiaelb
HoWnB sad pAilavalopmerd Au>oth (HRA) MW Mile i eMM Otoap, IN. (PR% It is
the Won of •" Warm to bm atuii)t the taupe of utvim turd mgmpptve fmi'"a mided
wilb titters aeavloaa. for iudtre biWag putpoaea.
in M fmW VM
d order m pr mis a taal MI bevel consistency. �" daf'*= of
tdtailat o0 our axiadnR tpteartdtc
advlde4 MoedW a MtxioedR. Project Fisencial Rovieev, Tett ittc tett Fitmeltt$, rod
ammai Booaoadc Devetotpment Servtees we live kept (icer W=dMW with the pas VMW
of TIF ptaaloapee at $3.850. but have Wand the hourly bitable text to WAd those badop toed
in other commwitim
Reoopnitdrtp cut we carm tatldpax all aorttin$mda that wo wul atcuuater with the pttdom
on which we pnrddpato. we bdiavo 69 this aauctum WlU d$rtiiiawdY help to avold
misuttdetataedt P is tlta Ats+M We bolt ibrwud to ditcuadrtg OW tafbemadott wim Yoc at tlto
ragWat JRA mbeft OR May 4
U You love say g10,40 s. pleats all as at (UM 6416258.
dP
4205 Lerman Line Notch# Suter 1100 0 Mtnmp*4 i,'.tnnmte 55441 0 (611) 5547979 0 (611) SSOA11t Fox
MAY -M-'94 MON 12:2^ ID: EDS INC. TEL N0:786-3034 UV3 P03
AOREENaM BY AND BETWEEN
PUBLIC RESOURCE GROUP, INC.
end the
CITY OF MONTICE11.0, MINNESOTA
HOUSINO AND REDEVEMPMENT AUTHORITY
This Agteemeat made and eatlmcd into on the ' day of 1994, by and 1
between the Hooting and Redevelopment Audwo ity of Monticello, Mim=M a Miatean
Muddp liq, (weinaftes geed to as -HRA'), and Public Resource Group, Lia., t Minneson
corporation (hatinatter. eater. to as •FAO).
WHEREAS, the City of Monticello believes that communities are dynamic in the ttmse
that tiny ate aca uaatty changing; aid
WHEREAS, the City of Monticello bellem do the economy of is community it Need
by its active economic development F W&m; and
WHEREAS, the city ha initiated its economic development program through las lEioadng
sad Redevelopment Authority and utilim Tax Increment Financing as a Joey oompor:eat of its
aco>trtic development Ftwarn; and
WHEREAS, PRO creel a to waist the continued groats of the City of Monticello to
provide economic development cervica and technical, prokulanal ndmnce tM its Tex
I=Ment Financing program.
riF,v-02-•94 MON 12:27 ID:6DS T�Jr. TEL r0:7S6-?O_.4 WS _3 POW __..
NOW, in -"VAC, BASED UPON THE MUTUAL PROMISES AND
CONSIDERATIONS CONTAINED HEREIN, THE PARTIES HERETO AGREE AS
I. SCOPE OF SERVICES
A. PRG will provide ongoing consultation services as regaeated, to the City
of Monticello to oaaist in the appropriate sticture and implementation of
the economic development program.
B. PRG will provide marketing assistance on behalf of the city to identified
prospects on a case -by -ase basis. 'Ilton services would not be
reimbursed CSuch marketing assistance will include initial project review
and structuring and representation at the company's site visit to the City,
Should the marlxting process extend beyond typical requirements, at
City's opdon�PRG will be reimbursed on a hourly or Axed The basis for
additional hours devoted to the project.
C. CPRG will assist In malmaining communications between City stall
members, Bond Counsel, and project developm udlisittg the City's 17
assistance. As Rich, PRG will Ment with all companies committed to the
City and maintain follow-up and coordination, as appropriates
D. f.PRO wui prepam &w ontRecovery Grant apppcadm an behalf of site
City. In addition at dtefr discretion, other bancial paolatginQ WrAce:s
may be provided to cry or the City]
t
2
MRY-e2—Q4 MOtl 12:2e ID: BDS ItC. TEL ND: 786 -SO -4 rte.^3 F05
F
1. PRG will assist staff in providing prtliminary financial review,
analysis and recommendation for the structuring of specific TIF
development proposals.
2. PRG will assist in the collection of due required technical and
financial data, draft TIF plans and comdinam the dissemination of
the plans and related martial to other public agenda and will
review and confirm data with the City's bond counsel and fiscal
consultant.
3. PRG will assist in the preparation of materials for public hearings
and the presentation of the appropriate: infoneadon with the City.
P. Other duties related to the city's economic development program and 77
programs as directed by the City andlor its deaignmed agency.
It. PAYMffiiT FOR SERVICES
A. The City gees to payment for services as described in Section i, as
follows:
1. Mnemflng Smrices. Mark" servicet art classified a those
activities conducted on bdnlf of the city to assist in location of an
irtdwtry to the community. Than uavitxs, at no we to the City,
include the following:
sq Preliminary pmeot review;
b) Research and identification of potential Anandeg services.
3
PIPY-02--W MON 12:253 ID:BDS 1W. TEL NO: 786 -?F.1 13677 POE
C) Initial project structuring;
d) Attendance at formal site visit to the City as represeruative
■a of the Community to discuss fmandng altetmadves;
2. bwjzgjai Services - Other. For flnarkdal packaging services,
other than Tax Increment Financing, it is the undersmnding that
fees associated with packaging of debt financing applications are
the responsibility of the prospective industry with the exception of
Economic Recovery Grant Applications (ERG). It is mutually
agreed that the fees associated with packaging of ERG will not
exceed ��unless authorized by the City 11b fee dam not
include administra ion/reporting associated with ERG Awu ld 1
3. Snec►fle -n,.,+� Contultatio3/Coordjnatjng. Upon oomntitment of
a prospective industry to locate to the City, the City agrees to
utilize PRG, sir its discretion, to assist irIxvetW administrative
project contultadp� on and follow•uproject 000rdination and
completion at the rate of $90 • $110/mout, depending on staff
esdgnment.
4, F.mhtishmmt of Ta= nCteme�t F nancin� protects. At the City's
determination, PRG will be utilized to wilt in the design and
preparation of TIF documents Mr the comm,mity's n4or projects.
Fera for these services are as fbHows:
4
M:iv-02-'14 MON 12:25 ID:BDS IW. TEL NO: -86-K34 4673 PO" _
IL For completion of data preparation, processing and
certification of newly established or attended Tax
Increment Financing District - ii.85Q.
b. The City and PRG recognize that the development of tax
c=ement financing projects will be conducted on a
contingency basis. City payment for services shell include
all variable staff time and expma associated with each
Prudes
C. PRG will coordinate legislative requireman of Tax
Increment Financing, including provisions for accounting
for LGA and HACA paWties, with the City's Bond 1
Counsel or other de}ig=:- 1
S. Consultation fbr TIF XWer m. The City will, at its discretion,
seek to complete the data and Mucduing for the community's
smaller TIF projects. On this bade. PRO will be retained on an
hourly fee of !90.00 - II101hmw d�mdioa on staff axsiQemmt•
IS) Support the process and to oomploto the mince
documentation.
f0c. PRG also agrees to provide a monthly wooundng of hours expended and
fees that have been generated through this contract. It shall be PRG' and
the City's intent to provide an overall hourly average rata. consistent with
PRG Staff fee schedule,
5
MHY-02-'9.1 MDJ 12:0 ID:BD9 PC. TEL NO: 786-9034 mr-. Poe
M. ADDMONAL PROVISIONS
A. The City and PRG reserve the right to terminate this Ag:eandu upon 60
days written notice.
B. Each party to this Agreement binds himself and his partners, successors,
exeaouton, sdministraton,and assigns to the other party of this Agreematt
and to the partners, successors, executors, administrators, and assigns of
such other party, in r , j- to all covenants of this agmemen. Except as
above, neither party shall assign, sublet, or aartsfa his rest in this
agreement without the written consent of the other. Nothing herein shall
be construed as creating any personal liability on the pan of any offloer
or agent of any public body which may be party hecto, oar shall it be h
construed as giving any rights or benefits hereunder to anyone other than
the parties to this A$m mer t.
IN WrrMS WHEREOF. the parties hereto have mteoated this Agmentent as of the day
and year fins above written.
r* • " .. .rr ! • rc c • i
rr;7FrIoR, Me,
BY BY
rrS Penick W. PdWing, CBO
ArrMW BY
Leonard P. Kirseht, President
TI'$
6
HRA AGENDA
MAY 4, 1994
Consideration to review for acceptance the vear-end HRA Fund
and TIF -Debt Service Fund summaries.
A. Reference and Backaround.
Enclosed are copies of the year-end HRA Fund and TIF -Debt
Service Fund summaries as prepared and submitted by City
Finance Director Wolfsteller. Mr. Wolfsteller will review the
summaries with HRA member prior to acceptance.
Pago I
J
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Caen Surplus Iaa600 1/1/93
REVENUE:
Tramler m Inrn HRA
(tau mtramorta)
tntersst Intone
TOTAL REVENUE
EXPENSES
Pnmcpal Payment
Intaraet Emoneo
Paying Apam Fede
TOTAL EXPENSES
Goan Surplus (001,01) 12131193
AQ➢1IIlNA NOTA,
Or,pnel Dona dent
Outstanding D0r1a tma
as 0t 12731/93
Paymente am m 1994
Pnncoat
Ir11aa5t
Pa sng Apon Fane
nraur WM 1 01P.►i1
SUMMARY
TIF
• DEBT SERVICE
FUNDS
12/31783
19900
MRA
1990A
1984
1995
1987A
19978
1089A
RE515IELE/
1992
19920
TOTALS
WART
EW
RAINDANCE
CONST,a
NAWCCI Fi DER
vM
jePPEB
AR0PAAX
SI11111RBAN
AlLSONDS
IIs$
S30, 129
137,138
556,271
530.908
529.058
559,030
SO
SO
$242.534
$99.108
$26.000
$38.675
549.975
$26,925
526,300
552.525
$13,225
$8.165
5241,790
$84,950
1330
Mm
5252
5503
MIA
WAA
555
532
17.595
51.2'.9
$.."8,330
539.335
550.727
527128
$29.514
SS3.369
$13.280
58.202
5245.365
566.179
525,000
510.000
$35,000
$20.000
55.000
530.000
SO
$0
5125.000
555.000
$3.250
$24.665
$18.099
$9.835
522.030
$25.471
$5.043
$3,047
5110.640
533.862
5816
1423
SAM
1428
586
142
i0
t0
52.631
5269
528.899
535.288
$53.502
$29.263
$27,518
555.913
$5.043
S3047
S238A7,
589.13+
$27.563
1141.186
553.495
528.973
925.353
558.488
$8.237
55.155
$249,449
S96.156
5155.000
$350.000
$365.000
$155.000
5260400
$301.000
1125.000
$75.000
5560.000
525,600
5300.000
11240.000
$90.000
9250.000
$275.000
5125.000
$75.000
550.5.000
925.000
115.000
05.000
$20.000
$5.000
530.000
$0
SO
$80.000
$1,094
$23,950
1115.897
57,105
$21,608
$22,940
$7,1900
$4.875
$30.340
$506
5450
$433
$495
$492
5560
W
W
$560
HRA AGENDA
MAY 4, 1994
5. Consideration to approve a Waiver Letter amendino the Private
Redevelopment Contract between the Schulz Properties and the
HRA.
A. Reference and Backaround:
Enclosed is a copy of the Letter of Waiver outlining the
reasons for the amendment request. Preparation of the letter
was upon the advise of Attorney Steve Bubul. The company and
project is financially solid. Originally, SBA was not going
to be part of the financial package because Marquette Bank
agreed to participate fully; however, from Public Resource
Group's prospective an SBA loan would be a benefit to Polycast
Mfg. Therefore, SBA approval has slowed down the project
commencement date.
B. Alternative Action:
A motion to approve the Letter of Waiver.
2. A motion to deny approval of the Letter of Waiver.
C. Staff Recommendation:
In order for the redeveloper to comply with the Private
Redevelopment Contract, staff recommends approval.
D. Supoortina Data:
Copy of the Letter of Waiver and extended purchase agreement.
Page I
250 East Broadway
P. O. Box 1147
Monticello, MN
55362.9245
Phone: (612) 295-2711
Metro: (612) 333.5739
Fax- (612) 295.4404
Roy Schulz and Todd Schulz
Schulz Properties
880 Norway Drive
P 0 Box 878
Annandale, MN 86302-0878
RE: Letter of Waiver.
Dear Roy and Todd Schulz:
April 29, 1994
The Housing and Redevelopment Authority in and for the City of
Monticello, Minnesota approved waiving the commencement of
construction date of the Contract for Private Redevelopment by and
between the Housing and Redevelopment Authority in and for the City
of Monticello, Minnesota and Schulz Properties. Contract dated
March 14, 1994.
Whereas, Public Resource Group, Inc. applied for an SBA 804 Loan on
behalf of Polycast Mfg. Inc;
Whereas, SBA 504 Loan approval is anticipated prior to June 1,
1994;
Whereas, Marquette Bank Officer Bill Enders and the SBA Executive
Director Robert Alexander indicate a solid financial project;
Whereas, the original purchase agreement has been extonded to June
10, 1994 for the property described as Lot 3, Block 3, GIP;
Therefore, the HRA approved waiving the Contract for Private
Redevelopment, Article IV, Construction q( Mi)iimuel Imorovemente,
Page 10, Section 4.3, Commencement and SomDlgtlon of Construction.
Subject to unavoidable delays, the Redeveloper shall commence
construction of the Mimimum Improvements by June 1, 1994.
Roy and Todd Schulz
April 29, 1994
Page 2
Please be advised.
Sincerely,
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF MONTICELLO, MINNESOTA
011ie Koropchak
Executive Director
CC: Mr. Robert Alexander, SBA Office
Mr. Bill Enders, Marquette Bank - Monticello
Mrs. Deb Gustafson, Public Resource Group, Inc.
Mr. George Phillipa, Oakwood Industrial Park Partnership
TIF District No. 1-16 File
Faun No. 161a J
ADDENDUM TO
PURCHASEAGAEEYENT
,m► 6m i - M M Fiwmfa amtlrb d
dadlbs w l-blft ohY9 ad d r ar nYr d Inb b.r.
1. Dots 76 _ 194
2. Popo Of I Pao -
3 Addendum b Pwcl Agra~ balwe.dabd "�+"• � A191L W bft{t. ds PL dl.ee
.. and sob of Ow PrW.tY .• 3 : R.Q,1-11 3 , D n1V.✓..�i .IwIdpA4T.d@ lan�.�
a M d+.,bkLd, .
-ie Stx. 1 -0. 19 4�i . a %- -u- run�w eti
c,...,e )tAAhr> _
.
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12.
,&
ta
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,a
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21.
22.
23,
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29
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2
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31,
32,
33
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Q�e.el 11dtJ1r�41 (d�k..p� Q.y�at+ p�.Ya�,
31 A'a
HRA AGENDA
MAY 4, 1994
l
6. Consideration to aoorove the Certificate of Completion of the
Private Redevelopment Contract between the H -Window Comoanv
and the HRA.
A. Reference and Backaround.
As per the Private Redevelopment Contract the meaning of the
minimum improvements was the construction of a 26,600 sq ft
manufacturing facility addition and 4,000 sq ft of office
space. Completion date for the minimum improvements was
January 31, 1994. The City Building Official has issued a
temporary occupancy permit, as the office area is not complete
and may not be until need for utilization. According to
County Assessor Doug Gruber, the January 2, 1994 increased
estimated market value is $600,000 which is $91,200 short of
the projected value of the expansion.
According to the contract the HRA either approves the
Certificate of Completion or upon the request of the
Redeveloper, the HRA will indicate in writing the reasons the
Redeveloper failed to complete the minimum improvements.
9 B. Alternative Action:
1. A motion to approve the Certificate of Completion.
2. A motion authorizing preparation of a letter stating
reasons the Certificate of Completion was not approved.
3. A motion to table any action.
C. Su000rtina Data:
Copy of the Certificate of Completion.
i
Page 1
Such rejection shall be made within ten (10) days after receipt of the notice of such
7* hangs. The approval of any such change in the Construction Plans will not be
�U nreasonably withheld.
l yl��s3
,Qo+ Section 4.3. Commencement and Completion of Construction. Subject to
Unavoidable Delays, the Redeveloper shall commence construction of the Minimum
p6� Improvements by —September 18, 1993. Subject to Unavoidable Delays, the
Redeveloper shall complete the construction of the Minimum Improvements by
8eeember 31, 1990. All work with respect to the Minimum Improvements to be
4qy constructed or provided by the Redeveloper on the Redevelopment Property shall be
in conformity with the Construction Plans as submitted by the Redeveloper and
.174-13 approved by the Authority.
The Redeveloper agrees for Itself, its successors and assigns, and every
`( that the
�N/jRedeveloperr in ,and such successors anterest to the nd assigns, ment shall promor ptlyrt beginand diligently
prosecute to completion the redevelopment of the Redevelopment Property through
the construction of the Minimum Improvements thereon, and that such construction
shall in any event be commenced and completed within the period specified in this
Section 4.3 of this Agreement. The Redeveloper shall make reports, in such detail
and at such times as may reasonably be requested by the Authority, as to the actual
progress of the Redeveloper with respect to such construction.
Section 4.4. Certificate of Completion.
(a) Promptly after substantial completion of the Minimum Improvements In
accordance with those provisions of the Agreement relating solely to the obligations
of the Redeveloper to construct the Minimum Improvements (including the dates for
beginning and completion thereof), the Authority will furnish the Redeveloper with
an appropriate instrument so certifying. Such certification by the Authority shall
be (and It shall be so provided in the Deed and In the certification itself) a
conclusive determination of satisfaction and termination of the agreements and
covenants in the Agreement and In the Deed with respect to the obligations of the
Redeveloper, and its successors and assigns, to construct the Minimum
Improvements and the dates for the beginning and completion thereof. Such
certification and such determination shall not constitute evidence of compliance with
or satisfaction of any obligation of the Redeveloper to any Holder of a Mortgage, or
any Insurer of a Mortgage, securing money loaned to finance the Minimum
Improvements, or any part thereof.
(b) The certificate provided for In this Section 4.4 of this Agreement shell
be In such form as will enable It to be recorded In the proper office for the
recordation of deeds and other instruments portaining to the Redevelopment
Property. If the Authority shall refuse or fail to provide any certification in
accordance with the provisions of this Section 4.4 of this Agreement, the Authority
shall, within thirty (30) days after written request by the Redevelopor, provide the
Redeveloper with a written statement, Indicating In adequate dotail In what respects
the Rodeveloper has failed to complete the Minimum Improvements In accordance with
the provisions of the Agreement, or is otherwise In default, and what measures or
acts it will be necessary, In the opinion of the Authority, for the Redeveloper to take
or perform In order to obtain such cortif(cation.
(c) The construction of the Minimum improvements shall be deemed to be
substantially completed when the Redoveloper has received a certificate of occupancy
from the responsible inspecting authority.
Bla"u6
OLOO-21
SCHEDULE B
CERTIFICATE OF COMPLETION
The undersigned hereby certify that H -Window Company, a subsidiary of
NAWCO Minnesota, Inc. , a Minnesota corporation, ("H -Window Company") has fully
and completely compiled with its obligations under Article IV of that certain Contract
for Private Redevelopment by and between the Housing and Redevelopment Authority
in and for the City of Monticello, Minnesota and H -Window Company, dated ,
1999, with respect to construction of the Minimum Improvements in accordance w nt
the Construction Plans, and are released and forever discharged from its obligations
to construct under the above -referenced Article IV.
Dated: , 199_. HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE
CITY OF MONTICELLO, MINNESOTA
By
Its
By
Its
STATE OF MINNESOTA )
) as.
COUNTY OF WRIGHT )
I
On this day of , 199_, before me, a Notary Public within and
for said County, personally appeared , to me personally
known, who, being by me duly sworn, did say that (s)he is the President of the
Authority named In the foregoing instrument; that the seal affixed to said instrument
is the seal of said Authority, that said Instrument was signed and sealed in behalf
of said Authority by authority of its governing body; and said
acknowledged said instrument to be the free act and deed of said Authority.
Notary Public
STATE OF MINNESOTA )
) Be.
COUNTY OF WRIGHT )
On this day of , 199_, before me, a Notary Public within and
for said County, personally appeared , to me personally
known, who, being by me duly sworn, did say that (s)ae 16 the Executive Director
of the Authority named in the foregoing Instrument; that the seal affixed to said
instrument to the seal of said Authority; that said instrument was signed and sealed
in behalf of said Authority by authority of its gevernin body; and said
acknowledged said Instrument to be the free act and deed of said Authority.
Notary Public
luau
loin -at B-1 Wril
SCHEDULE A
REDEVELOPNMT PROPERTY
Lots 11 and 12, Block 2, Oakwood Industrial Perk, eccordlng to the
recorded plat thereof in Wright County, Minnesota.
PIN 155-018-002110
PID9 155-018-002120
nru►u
iaiso•t9
A-1
ta'r+-
Council Agenda - 4/25/94
a. Consideration of selecting a development proposal and authorize
negotiation of a development agreement - Outlot A. Country Club
Manor. (J.O.)
A. REFERENCE AND BACKGROUND:
As you recall, at the special meeting on April 12, Council heard
presentations from Hornig Companies and Shelter Corporation and had an
opportunity to ask questions. A decision regarding this matter was tabled
pending assembly of the data in summary form.
The summary has been completed and is attached for your review.
Information in the summary was gleaned from the proposals and obtained
through follow-up questioning. To reduce the chance of misrepresentation,
it has been reviewed and accepted as accurate by both developers.
The purpose of the summary is to provide an understandable apples -to -
apples comparison of each proposal. The summary is self-explanatory, so I
will not detail it any further.
B. ALTERNATIVE. ACTIONS:
1. Motion to accept proposal submitted by Hornig Company and
authorize negotiation of development agreement.
2. Motion to accept proposal submitted by Shelter Corporation and
authorize negotiation of development agreement.
3. Motion to table the matter.
This alternative should be selected if Council is not satisfied with
either proposal and would like to reissue RFPs at a later date.
1 W21-52I_LOu! UMN0- 9R
Both alternatives appear to result in the "highest and best" use of the land.
The Hornig proposal is superior in terms of investment in bricks and
mortar. It will result in a market rate apartment featuring bigger
apartment units resulting in a complex that pays higher traces than the
Shelter proposal; however, the Hornig proposal will result in a higher
population and a greater associated impact on schools and public services.
Also, the Hornig plan requires City completion of freeway mitigation
measures, which have not been completely defined.
Council Agenda - 4125/94
The Shelter plan provides added value by offering to develop park areas and
calls for the developer paying for more of the development expenses
associated with grading and freeway noise mitigation. City staff is
comfortable with either proposal.
Staff is seeking authorization to negotiate the specifics of the transaction,
which would include negotiating terms that would encourage the developer
to complete phase H on a timely basis. The deal on phase II would not be
open-ended and should require a financial commitment of some kind.
Development of final plans and specifications would also be included in the
next phase. A goal of the negotiations is to add clarity to expectations with
regard to site development, including berming, landscaping, park design,
pond design, etc.
SUPPORTING DATA:
Supplemental letter from Hornig regarding proposal; Development proposal
summary and comparison.
April 20,1994
The Honorable Mayor Brad Fyle
Council Members Shirly Anderson.
Clint Herbest. Patty Olson
City of Monticello
250 East Broadway
Monticello, MN. 55362
Dear Mayor. Council Members. and City Staff:
This letter will attempt to clarify our position
regarding the 16 acre Monticello site. Our hope is to
provide the lowest density, highest quality, market rate
project possible. Proposed rents will range from $400-600 a
month. Monticello's contribution thru land buy downs. site
improvements. and berm construction for freeway noise
abatement should translate into a superior product for its
residents! We will provide a product that could not be
economically built without public participation.
This product will be a townhouse and a cottage style
unit. with separate entrances and attached garages that will
include the following:
- approximately 1040 sq. ft. senior cottages
- approximately 1348 sq. ft. family town homes
- dishwasher
- washer, dryer
- air conditioning
- high efficiency forced air furnace and water heater
- mini blinds
- attached single car garage with opener
- maintence free steel siding
- decorator shingles
- triple glazed aluminum clad windows
- state energy code compliance • 10%
if we are selected for this project we will hire a
professional market study company to determine the demand for
senior and family unite. This will guide our construction
schedule. We think a fall start is possible with at least
one phase. possible two. A complete build- out may take
threo ycaro.
We have owned and managed multi housing unite the past 6
Years in Monticello. we want to develop a project that
everyone can be proud of -now and into the future. This
improvement will generate significant property taxes. We
anticipate •1.000 to 01.500 per unit per year in property
taxes.
P.VL
owner occupied units would appear unlikely based on
present information. Should market demand forecast a need we
would welcome this option. we look forward to working with
you!
Thank you for your consideration!
Sincerely,
Oavo Horni
P. Ora
::✓Fl0MIT PROP03AL OCSCRIPTION / CON►ARISOII 410 ANALYSIS
W IL01 A OF CWkY CM KKR • 1/11/9t
WOmip CO VITS
imItor CMIS
Stye mw was
1
%a•i t5et
:
2
5urDlut land
2.0
5
teai was
11
15
PrIctIrre
!11.116
121,000
!end Orta - loll
$190,000
$166.000
E.VEB56 410 CREOIT SUNNM
`
LMet iwck»d;+� 1941,t 11�i�i
�FLJ
V 1Vv
CE'IELOPER CITY
CUROPER CITY
Land mt
11111,000
1161,000
a•ro Ind two Olnttnp
115,000 111,000 split 50/60
00,000 Div, cmpleta ben { landsc
e planttnp/TM st
110,000 One 1250 tree every to
110,000 Cna 1250 trot wary 20 '
-'ra develepoeet
12,000 11.000 ppimp tot let/city teare
;:2,000 Privets tot lot uftd Public
swa tar. -pond pradirp
111,000 City Punded - TIF Vooftld
15,000 $16,000 Oevalcar tueded
�CBTOIAL
1216,000 116,000
1211.000 120,000
roU1 inratcnent
1262.000
1256.005
:and price pin'a
City Irrmtaent (nu)
tIS2,000
1111.000
Phase I anad I1�
0 . G'pl �
p
Photo III
5/tcmhOas/
1{1.005 (s�ppp/vwi'C�
t{2.000 (aLll @@*Agee)
Acro
rwA. 7.Pe 4
)host IIl
(!16,000 V'�r
$!11,000
.6 Z/
QEYELOPPIENT PROMAt DWRiPTION / COMPARISON AND ARALYSIS
OUTLot A OF COWITAY CLUB Iwo - 1/11/14
wlefni COMIPFNTS
Shelter CTIOIEHT,5
Developer ate 1FY ileac
IPG Hi'P woo
lackground.
Good
poveloper 9" RFP shed
yet RFP Good
Ova 11 } tcattons.
Good
Inc000 cape/renters ne
yes
Sits Plan,
JL�,,,�
PHASE 1 • Family Apt$
PHASE 1 - Family Apts
Total stnxturts/fes 5
1
Total unlit at
17
total more it 11_4414120- .
e,tl
Building Catnt. cost &_;agv' �r•1Y37.
Total Tax capacity C
Price offered
p
181,000
kwal Tarn ebt:r.
11.000
Two bedroG unite $;,-----
Thres bedroom
TOO glra os
unite ta_....
Total bedroom1....tr'.7
27
Acres used 1-3e••
1
Density 1.01
1.21
Price offered 1121,000
114,000
Price oar wit 11,000
12.270
Prics/atre 121,801
121.000
„ Total geropa 41
11
Uncovered perking 11
11
Total parking stella 111
111
Total stall/unit 2.11
1.00
washer/Dryer In each wit
Control building
PHASE 12 • 50101' Apt$ - PARS! 11 - Saetor Apta
Total aNcturea/lr
�Ole llwl cottage$
_
Total unite
Total bedrooal
Total setas" it
Ca
Building nit. coat w%
Total Ta Capaoity
r �,
JL�,,,�
Annual Taxa 4►F
�... RG7s'?
1C ..............
Aeras Vold
e.l+
a
Oenllty
e,tl
1.5
Price offered
172.000
181,000
Price Par Wit
11.000
121211
TOO glra os
11
.__..�..._..
Uncovered parking
1
total whing •tail$
21
. .....
total stall/unit
Mahar/OtyaP
y 1.11♦
NI.N►Jrwa-.e�.lKa � C��'`e"'
.� liltwl?..
j
DEVELOPMENT PROPOSAL DESCRIPTION I COMPARISON AND ANALYSIS
OUTLOT A OF COUNTRY CLUB MANOR - 4/21194
14ORMO I I COMMENTS I SHELTER I I COMMENTS
D 'peri6e Proposal Good See P Good
f., : ounA Gooc
Developer See Pro Good See Pro Coon
Oualllkations: Gooc
PHASE I - FAMILY APTS
PHASE I - FAMILY APTS
Total stnxtulesRarn
5
7
Total unite
42
37
Ave sq Munit
1,345
1.083
Total sous R
58,490
40.083
Btnldi g corm Colt
92,000.000
$1,828.000
Total tax caPacty
Annual taxes
$45.000
533.300
Two bedroom units
11
19
Three bedroom LnM
32
9
Total bedrooms
116
62
Acres used
4.36
4
Density - UNWaue
963
925
Price offered
$128,000
$94.000
Price per unit
$3.000
$2.270
Pnceracra
$28.899
$21,000
crapes
42
37
LI,—load par"
76
74
Total pit" etas!
118
1 t 1
Total stallA nt
2.81
300
Esumated population
133
59
Ranter income cap?
rc
yes
Estimated renal rams
$400-f8001
2BWS889 - 3BR/5774
Wasnwrdryer
In= tun
Centra wftrq
PHASE II - SENIOR APTF
PHASE II - SENIOR APTS
1 Total units
24
29
Total bodrdoms
48
32
Ave sq I91rmt
1,040
900
Total square It
24.960
20.909
BuddN canst. oast
S1.100.0Do
1,170.909
Total tax capadry
Annual taxes
525.000
523,400
Acres used
364
4
Deriairy - urutNaae
625
45
Pnceoffered
$72.000
594,000
Price per unit
$3,000
$3.231
r T,W garages
24
25
wed par"
6
39
Tota gaming stab
32
18
Total a➢On rut
1.33
2.15
Wash'nrtbyw
In each uPoi
N each ulxo
NORMO
COMMENTS
SHELTER
I COMMENTS
Sturm sewer aeras
3
3
Park aero
2
2
Surplus lend
2,6
3
Twat acro
16
16
Prce/ace
$21,146
$21,000
Lard price- 1.11
$198.000
$166.000
EXPENSE AND CREDIT
SUMMARY - PHASES I AND 11
DEVELOPER
CITY
DEVELOPER
CITY
Lard cot
$198.000
$168.000
Berm and Vee plan"
$15,000
$13.000 Spw 50W
$30,000
Dev. mmpptaa Wn4antlaeaperp
Tree planes grM St
$10.000 One SM Vw every 20
$10.000 One SM no awry 20'
Park development
$3,000
$6.000 Dev-tot lot, City-atter
$43.000
Dov -tat 41 and ores
Storm eew.-pad grading
$15.000
53.000
$10.000 Dwelopw kt ded
SUBTOTAL
$216.6110
$46.000
$246.000
$20,000
Tote) lad and Wer
Improvement+
5262.000
5266,000
Lend price mow
Clq eapwdm(ret)
$152,000
$146.000
Ory lock kno, value
56.000
$40000
Tow 1rrvMmrnt
$3.362.000
$3.064,000
w4ftAlaVGMID
Total arwlal laced
Phases I and 0
$70,000
'7[!8.700
city ohms of owe
$11200
$9072
PHASE 111 - POSSIBILITIES
Phase l0
S'bwnhw wv
$6•.000
In de nonsl est mrkell
$63.000
• we
M 8 P TRANSPORT, INC.
Iq.TTRLNCT IMI(
44641 03/31/94 INVOICE
CIILCK NO OAIC
013079 04/10/94
Df."C1111'IF HI ANM �KII Ir�I.IH INI M I AIM NINI
1:s 8.00 131,.00
IUTALS
M III P TRANSPORT, INC.
!863122 OR METRO U1.4740
P.O. BOK 1»
MONTICELLO. MN 86382
-- — —rubs mc"o Nl CIU.CK Mo"JfJI
138.00 13.I.Ov
FIRST NATIONAL BANK 13879
OF MONTICELLO
MONTICELLO. MN 66782
76666818
UAII I,Iq 1 A N11 I,111.K NAIKINI
04/10/94 0131379 $1310.00
HUNDRED 11IINTY FIVE DULI_ARS AND 00 CENTS
PAY
10
n6: 110141'ICCIJ_0 HFA
(1211)[11 CITY HALL— 230 E 1,1ROADWAY
til: F.O."OX U -;A
141114'PICELLII PIW :1.it,
p0i38?96' I:09190SS6?C 0 001 039 911 —�
HOLMEs & GRAVEN
CRASMED
T rma." Ca wam
TiPb—UI/=4W
April 20, 199LL
INVOICE M 44999
MN190: 4a
CITY OF MONTICELLO TIF M1-16 — Schuiz
P 0 BGX 1147
MONTICELLO MN 93364-9a43
For All
Legal
Services From
March
7, 1994 Thru March 31, 1994 As Follows.
03/07/94
SJB
Phone call with 0. Koropchak re
0 90
60. GC -
Contract: revise Contra.:t
03/09/94
SJB
Review Kutsc!+aid letter; r+•.ise
0 79
9C 00
Contract
03/10/94
SJB
Phone call with 0. Koropchak letter
0 60
90 ':0
to Kutscheidi finalize Contract
03/14/94
SJB
Letter to 0. Koropchak
0 90
60.1:0
Tota:
Services:
1113C6. CO
Name
Stephen J Bubul
For All Disoursements As Fallows:
Postage
Hours Rate Amount
2.99 ::0.00 306.00
6. 84
Total Disbursements: S6.?LL
Total Servicer Ana Disbursements: 0312.64
11
HOLMES & GRAVEN
CeaeTneo
e..mm.r Cm.. M....er. rr.r a Ode
April 20, 1895
INVOICE a 44998
MN190: 1
CITY OF MONTICELLO Oaneral
P 0 BOX 1147
MONTICELLO MN 553b:-9a4z1
For All Legal Services From
March 28, 1994 Thru Marta 31, 1994 As Follows.
03/28/94 SJ9 Phone tai: uitn 0. karopcnai and J.
Dean re general HRA issues
Name
Stephen J Bubul
I aoi'ro. urtur contry t} law
"e Ik7 aCCJNrI .".fUn Ab
tlCmURd
ru:l end Cor• ero L rW
tt
de .
of C&ff*V
0.25 30 3G
Tota. Servttea• a30. CO
Hours Rata Amount
0.25 120. 00 30 00
rota, Services And Disbursements
0:20. 0)
r 0��
I !
PUBLIC RESOURCE
!
GROUP, INC.
April 25, 1994 It
Marketing, Development & Finance Specialists
Ms. 011ie Koropchak
City of Monticello
250 East Broadway
P.O. Box 1147
Monticello, MN 55362
STATEMENT
Consulting Servim—Manch 16, 1994 through April 16, 1994
.�'j 10-94
\-\V LPK—Follow up with 011ie Re: SBA scheduling, Polycast
Development Agreement schedule .50
4.12-94
' t\ LPK—H-Window Company S C 4Z G— .75
4-14-94
LPK—Follow-up with Steve Lemme Re: Braid Simenson .50
Mia not billed
4.13-94
LPK—Tappers project stricture, follow-up with 011ie SBA 1.75
4.14-94
LPK—Tappers, Structuring options 1.50
4.15-94
LPK—Tappers, Options on existing 504, finance structure Lai
NET CHARGEABLE HOURS: 1.75
Net Chargeable Hours ® $75/Hour $131.25
TOTAL AMOUNT DUE Luz
CURRENT OVER OVER 60 OVER 44
$131.25
TERMS: NET DUE UPON RECEIPT, 1.33% PER MONTH SERVICE CHARGE ON
PAST DUE ACCOUNTS
4205 Lancaster Lane North• Suite 1100 • Minneapolis. Minns= 55441 ♦ (612) 5%7979 0 (612)55 OM Fax
r
Casts Stu" (W,.M) 1/1l93
REVENUE:
Transfer ci ft= MRA
(tax b lafg, erm)
fnterast bumme
TOTAL REVENUE
EXPENSES:
PaMem
tri Ejoww
Paya10 AQenf Fees
TUTAL EXPENSES
Cash SwJ As (CefidQ 12/31/93
ADDITIONAL NOTES:
Orgbw Oor10 debt
o p bond dM
as of 12M IM
PaMeM Qua in 1994
Print ow
trtierest
PaybV Agents Fees
rssw.wx,: oasts&
SUMMARY
TIF - DEBT SERVICE FUNDS
12/31/83
199W MRA 1990A
1984 1985 1987A 19878 1989A REWELE/ 1992 199M TOTALS MART
E51 RANDA CONST, 5 NAWCQ ELDERLY HSG TAPPER A9OPLAX SUBURBAN ALL BON 7M sT
$30,129 $37,138 $56,271 $30,908 $29,058 $59,030 $0 $0 $242,534 $99.108
528.000
$38.675
549.975
$26.925
$26.300
$52,525
$13.225
$8,165
$241.790
$84,950
S=
5550
SZ52
5403
MA
584.4
m
M
53.595
Cl 229
$26.330
$39.335
$50.727
$27.328
$26.814
$53.369
$13.280
$8,202
$245.385
$86.179
$25.000
$10.000
$35.000
$20.000
$5.000
$30,000
$0
$0
$125.000
$55,000
$3,250
$24.865
$18.099
$8.835
$22.030
$25,471
$5,043
$3,047
$110.640
$33,862
S646
5423
5403
5428
5488
942
50
50
52.881
5289
$28,896
$35.288
553.502
$29.263
$27.518
$55,913
$5.043
$3,047
$238.471
$89,131
$27,563
$41,186
$53.496
$28.973
$28,353
$56,486
$8,237
$5,156
$249,449
$96.156
$155.000 $350.000 $365.000 $155.000
$25.000 $300.000 $240.000 $90,000
$25400 $15.000 $35.000 $20.000
$1,094 $23,950 $15.867 $7,105
$506 S450 $433 $495
$260.000
$305.000
$125,000
$75,000
$560.000
$250,000
$275,000
$125,000
$75,000
$505,000
$5,000
$30.000
$0
$0
$60,000
$21,608
$22,940
$7,800
$4,875
$30,340
$492
$560
$0
$0
$560
Cash Suphrs(de8at1 L11M
REVENUE:
Tum
Tu innemenu
Interest income
Bond Proceeds
TOTAL
EXPENSES
Ssiarm
PERA
FICA
Health
Prof. savie Iepl
rrvic n$r
'rm-l/mnLadamis
Legal publication
Pr Pcmy taxes
Duoslmemb-hip.
Prof. eemrn-m admin.
Interest expense -debt
Pnnmpsl espens.-deM
Transfer to debt earvtce
Nue ether cspenm
TIF Loan
Land mquisl0on
TOTAL
Cash Surpiw (do0cit) 12/31/93
OrLsiul Ions
Outstanding loco bstLaees
u of I MI &193
Paymeau due to 1994
HRASUM.WKI : 05102/W
HRA FUND
SUMMARY
12/31/93
DISE /2
DIST 613
DIST 015
DIST 61
BEETCAI.P/
DIST 68
DIST N
DIST 66
DISE' 09
DIST #7
DIST 06
DIST 09
DIST 610
DIST 611
DISE •L7
STANDARD
DIST 414
CUSTOM
GENERAL
mi
LAB&=
Pffi
M.92
CONST.9
BADMANCE
NAffCQ
NSP
TAPPE[t
REMIMvt a
MAErM
ARQPIAH
184N
SUBURBAN
V�ANqpy
$TBA
TOTAI
$16.817
$22.962
$159,094
($35.629)
836.201
950.908
931.519
$969
95.716
(1177,8081
(SIM)
$15.264
44.4428
$6.681
90
$135.093
$.961.853
110
$0
80
90
to
80
110
so
$0
f0
(11.249
$11.249
80
943.284
966.717
929,298
1172.486
$66.632
338.943
$6.278
826.461
$77,323
112,834
90
5362.168
90
W
m
80
so
80
so
W
$0
f0
$15.690
E1" 64(1
to
10
to
ED
ED
to
ED
TD
ED
in
to
816
ED
to
:D
943.284
966.717
823.298
$72.486
$06.632
1138.943
{8.278
825.461
927,323
$2.831
$15
f0
$0
90
$26.639
9388.997
$6.768
$6,756
5703
$303
6817
$517
(550
$660
11,010
{193
$2.898
11.093
,177
$6.371
1643
$113
$746
$113
$716
$2.230
E'.So
$280
831
9231
$440
999
980
{17h
6189
90
93,643
894
66.3.38
$4.0481
{fi.1H
$19.317
111.6M
99.906
$1.440
$12.748
$10.886
$16.083
$2.000
9:44,748
128,300
926.000
649.975
$58.876
$26,926
824.110
925,416
$13,225
fh,18R
$241.790
$5A
$511
999
844,666
Ilmom
976.988
649,976
$98,875
{$2,152
95,"0
124,204
92$.416
$0
$13,631
$0.208
2".17A
92h,653
{6,1Nh
114.817
12017h
&146,563
$15.718
921,891
SIMAI1
1138.8211
$88.711
978.706
938,310
93,8(1'11
$8,962
(1178.700)
92.246
11.748
($13.651,
(tr.!2.072i
({6,14481
11/7,Ilh
54(LVIS9
956,761
$82.000
$191.661
$23,000
so
su
1107,728
$18.000
to
8o
126,868
$3.280
MONnCELLO, MINNESOTA
SUMMARY OF HOURLY BILLINGS
Date
I Hours
Date
HOun
Date
I Hour
I Date
I Hours
3/2S
7(3.5) 3.5
7/2
.75
9/7
1.75
10/14
1.25
5/26
2.30
7/9
.75
9/20
.75
10/15
1.00
6/2
.50
7/13
.50
6/3
1.50
7/15
.30
6/4
.50
7/16
1.30
6/8
1.00
7/29
.25
6/9
.25
8/10
2.25
6/10
2.50
8/18
2.25
6111
1.73
8/19
3.75
6/14
3.0(3.0)0
8/M
1.50
6/21
1.25
8/23
1.50
6122
1.50
8/26
1.00
6123
.50
8/31
.75
STANDARD IRON
Date
Hours
Date
6/23
1.00
8/ll
6/30
1.50
8/16
7/29
.25
8/20
8/2
.50
8/24
8/4
1.75
8/26
8/6
.75
9/7
8/10
1.00
9/14
9/22
1.25
10/21
1.75
9/23
2.00
10/22
1.25
9/28
2.50
10/27
1.73
9/29
3.23
10/28
1.73
9/30
2.75
10/29
.75
10/1
2.25
11/8
.75
10/4
2.73
11/16
.75
10/5
1.75
11 /24
.25
10/6
1.25
12/9
.50
10/11
2.25
2/18
.50
10/13
1.25
1oti Hours TY.3
a S d.WO - ii,4s7.30
(includes ERG Application)
Hours
Date
Hours
1.25
11/11
1.00
.75
11/12
.50
1.75
1/11
.50
1.50
1/23
.25
1.25
2/8
.50
1.00
2/14
.25
4.50
3/11
1.50
10tal Hours 2l.l5 0 bly.W o v,143.75
I
POLYCAST
Date
Elm,
Date
Hours
Date I Hours
8/13
.75
8/23
1.25
1/25 .25
8/18
1.75
10f26
1.25
2/18 1.50
8/17
1.50
1/20
.50
2/23 .75
PAMPERED PETS
TO-tIl Hours 7 (S .00
Data Hours
Date
Hours
Date
Hou, Date Hours
9/7 .50
919
2.25
9/15
1.25 9/24 .75
9/8 2.50
9/13
1.25
9/16
1.50 1014 1.25
AROPLAX
fotd'Rours 6'Sat 97301 -6 S618.Ij
Date
Hours
Date
I Hours
12/13
1.00
12/14
50
ADVANCED FOOD
SCIENCES
7oau mours $13.00 - i I 12.jj
Data
Hours
Date
Hours
10/29
(.25)0
11/3
(.50)0
11/1
(1.25)0
11/15
1.25
11/2
(3.50)0
11/16
1.25
MARKMNG
lotal Hours 1.5J a $15M - $161.5(
Date
Hours
Date
Hours
2/93
1.75
9/93
4.75
2193
7.75
11193
6.50
6/93
4.25
1194
.75
lotal Hours 15.15 0 $O.Ut) - 5I.YJI.13
Actual Billing - S 0
TAX INCREMENT FINANCING BASICS
L PROJECTS AND DISTRICTS
A. Plum. Tax increment financing is used in conjunction with underlying development and
redevelopment powers. Tax increments must be spent within particular geographic amts created
under the development statutes. The basic planning area is infer ed to as a "Project," which also
has other names:
City: Development Distrim creased under Sections 469.124 to 469.174.
HRA: Redevelopment Project acted under Section 469.001 to 469.147.
EDA: Economic Development District, anted under Sectim 469.090 to 469.iog1, or
Development District or Redevelopment Project created using City or HRA powers.
All Projects require a general development or redevelopment plan, approved after a public hearing.
The bamdarm tend to be large am within which the authority intends to promote development
Of redevelopment
B. TIF Districte. TIF District am the specific parcels within a Project tees from which tax increment
will be captured. Them we Ove general types:
Redndopmat DW" Secdos 469.174, Subd. 10
Qaaliscadoear
(a) Parcels that melte up 70% of the district are improved, and mote than SO% of the
buildings (excluding outbuildings) an structurally substandard to a degree
requiring substantial renovation or clearwL To be considered 'improved," at
least ISN of the parcel's area mint contehr improvements. A building is not
subsTmdard if it complies with building codes of could be brought up to code at
a con of less than 15% of the cost of a comparable new building on that parcel.
(b) the district consists of veum, unused, anti meed. inappropriately used, or
in8egaealy used mil yards, mil storage facilities or esoessive or vacated railroad
righta•ofway.
Teem, restActlotu May collect Wermm fort 23 yawn after Use date of receipt of the
first iscranmt. 1990 Cbaspp : may desigmam conmencemast in the year often the
market value mches an agreed"trpaa minimum (mo more dm four yearn afar due of
cwdflcation� in which as the district dumdum is 20 yaw after such commencement
Yew.
At least 90% of the haammatt must ba toad to 11 dict arts of correcting cordiUau
drat allow desigmasioe of Wow kipme t dimricts.
ans4su
MA.
Renovation and Renewal District, Section 469.171, sobd. 10a.
Qualifications: The same parcel and area requirements apply as for a redevelopment
district. but only 201/6 of the buildings need be structurally substandard; another 200/a of
the buildings must require renovation or clearance to remove conditions such as
inadequate scree layout. incompatible land uses, or obsolete buildings not suitable for
improvement or conversion to other uses (that is, a lesser standard of blight).
Term. Restrictions: May collect increment for 15 years after the date of receipt of the
first increment. At least 90% of the increment must be used to finance the cost of
cot. ing conditions that allow designation of renovation and renewal districts.
Sods Condition District, Section 169.171, Sobd. 19
Qualifications:
(a) Unusual terrain, presence of hazardous substatim pollution or contaminants, or
soil deficiencies for 80% of the area in the disuiet requite substantial filling,
paling, removal or remedial action or other physical preparation. 1993 Change:
formerly requited that 70% of the era be vacant. and hazardous wastes were not
expressly named as a criteria; the change allows designatim of a developed parcel
a a soils district bund on hazardous waams.
(b) the estimated costs of physical preparation (excluding costs directly related eo
roods) exceeds the flair market value of the lend before the preparation. 1993
Ckaegsr con calcar meet this requirement for each parcel, or show that •
hazardous waam removal or mmedistion costs exceed S2 per square foot for the
petal.
(c) an area dom not qualify if it contains a wetland la jl n a development agreement
prohibits draining, filling or dteraiot, or other "binding legal assurances" for
preservation of the walasd are provided.
(d) the proposed development must be consis0ant with the comprehensive municipal
per•
1993 C wW Formerly, a development agteaaent coveting at teat S0% of the arcs was
required be= the district wits created.
Tom RstrUtlamr May collect increment for 12 yeah eller the dam of approval of the
TIF Plan; iaesemeat may be spew only to: acquire perceb on which improvements will
tames. pay dw coat of contenting the soil defkkneies (including public improvements
'dbu* caused by the deft itaneia'X rad pay allocated administrative expenses. An
acquired parcel may be sob fix a price 'no leas dun the eat of acquisition.'
Bow ft Dbuk1. SatMe 169.171. ubd,1l
QoWfiatlow Mara be a facility iaamded fbr occupancy in pot by pawns or families
of low and moderate income. Up to 20% of the W market value of this improvements
may be for uses other than low and modem Wcom housing.
e.rasosa
rtruc•3
Term, Restrictions: May collect increment for 25 years after the date of receipt of the
first increment subject to the same exception as for redevelopment districts. To maintain
qualification as a housing district. residents' income must be limited: for owner -occupied
housing, 95% of the units must be initially purchased by persons with income that is less
than or equal to the income requirements for qualified mortgage revenue bonds under
federal law: for rental projects, must satisfy the income requirements for qualified
residential rental projects under Section 142(d) of the internal Revenue Code, or W1. of
the units must be occupied by individuals with income 80% or less of the area median
income. The rental requirements apply for the life of the district If the income
requirements ate violated, the district duration is reduced to that of an economic
development district. Knee: additional restrictions apply for a "qualified housing district"
that is exempt from state aid penalties. See Section IV.
Economic Development District, Section 469.174, subd. 12
Qaalif catbos: The district don no meet the qualifications for any other type of district
and the municipality mast find that the district will (1) discourage business from moving
to another stats or municipality; (2) increase employment in the state; or (3) preserve and
enhance the in base of the stats.
Tam, Restrictions: May collect memment for nine yesm after the date of receipt of the
fust inetemeat, or eleven years after the date of plan approval, whichever date is first.
1990 Clamp: for districts filed for catif ca ion before lune 1. 1997, these periods were
eight years and ten years, respectively.
Increment may not be used to assist devalopmettn if mora than 15% of the buildings and
facilities (on a square footage basis) are used for a purpose other than:
(1) manuhmaing;
(2) wemhomin& storage and distribution of tangible personal property (excluding
retail sal«r,
(1) rmswch and development related to the aforementioned activities:
(4) telemarketing if that activity is the exclusive use of the property; or
(S) "tourism fheifitim..
or space necessary for and related to the above. Exception: Cities with population 5.000
or less they finances up to 3,000 square feet of commercial or retail facilities. The 5.000
Mum feet is cumulative for the city a a whole.
1990 Champ The teem 'tourism fae(IW was a tmtially restricted for districts created
after Moy )1, 1991. Now, suchis fieility means peoperty that: (1) is in s county where
floe me" paooete is aro mom am 85% of do state median income: (2) in a county in
which towism- elated earnings maks up at kart IS% of the total earnings in the county
(exchsd4 first clan cilia): (1) Is located outside the Twin Cities metropolitan area: (4 )
is located in a city with a maximum population of 20,000; and (S) is a mating facility,
amusement part, recreation Why. wldtral flicility. mama pmt, hotel. maul. lodging
S M.aU ,�,
rtrw•r
facility or nonhomestead dwelling unit that, in each case, is intended to serve primarily
individuals from outside the county.
Qualifications: Consists of parcels within a TIF District of any kind that are "designated
hazardous substance sites" or are contiguous parcels that the authority expects to be developed
together with the hazardous substance site.
"Designated hazardous substance sites" are parcels for which there is a state -approved
"development action response plan," and the authority has entered into an agreement providing
for removal actions or otherwise certified that it will finance such removal.
Term, restrictions: May collect increment from the subdistrict for up to 25 years after the date
of receipt of the fust subdistrict increment (which is, genaally, the tax attributable to the "base
value" of the parcel). This period overrides any shorter duration for the underlying TIF District,
except that during the exaaded period, the increment may be used only to pay the cost of
hazardous waste removal and related administrative cosh.
D. HOW INCREMENT MAY BE USED
A. TIF Plan. The use of increment must be spelled out in a TIF Plan approved by the City Council
(or County Board for a County HRA) after public bearing, with 304ay notice to the County and
School District, 10 days' published notice, and review by the planning commission. TIF Plans
describe the estimated tax increment projections, financing budget and maximum debt to be
issued. When approving the TIF Plan, the Council or Board must find (among other things) that
the proposed development would not reasonably be expected to occur solely through private
investment in the reasonably foreseeable finure (fie "but foe finding).
1993 Change: For housing said redevelopment districts, must ratify the county commissioner
who represents the ata of the TIF District it least 30 days before the date of publication of the
public hearing notice.
TIF Plans may be modified using the wee process as for approval of the initial plan. Generally.
modifications that do not increase expmdioaea or debt or call for new land acquisition may be
approved simply by solution. Notes modifications will not trigger application of current statues
unless the boundary of the TIF District is otpanded.
In addition to the specific limitations for each type of TIF District, tax increment may be
spent only for specified pwpotes permitted in the underlying development statutes. Such
purposes include, generally: land acquisition; site improvements; public amt on-site
utilkim demolition; relocation; tad admhtisowioe. If the authority owns a Projem
itscre em: may bevsed to fintaxe essentially any ripest of the Project. Because the
statutes are often ambigwws, whedw a pwdmft activity is TIF -eligible
may depend on the fleets in cub case.
Administrative expeaditwa stn limited to 10% of the expenditures authorised in the TIF
Plena or 10% of actual irwrement expenditures, whichever is less. They are defined to
mean all expenditures of the authority other than land acquisition and relocation costs and
costs "directly connected with the physical development of the real property in the
district." Yob: the County auditor may assess each TIF District for the county's cost of
administering the district and the fee may be paid from tax increment.
Increment may not be used to finance buildings that are used "primarily and regularly for
conducting the business" of any unit of government, except for parking structures, a
commons area used as a public perk, or a facility used for social, recreational or
conference purposes.
1997 Change: If a TIF•finanad social, recreational or conference facility is operated by
an entity other than the authority, the authority's governing body must approve operating
policies for the facility. This would apply, for example, when an HRA finances a city
community center.
1993 Clutoget Gnunaty Food: An audrority may establish a guaranty fund to
irndemniN a person for liability for remediation costs under stab or federal environmental
law. The maximum term of the indemnity is 25 years, and the maximum amours is one-
half of the remedistion casts. The authority may deposit tax inch menu in the fired, and
the mwhctpality may also appropriate moory for deposit in the !turd.
For districts created after April 30, 1990, no more dna 25% of the increment may be
spew outside the boundaries of the TTF District (except in the an of housing distries,
(ions which increment may be spew to finance "housing projects* located anywhere in the
broader Project ares). Administrative costs aro consldered spent amide the district.
Imrement from older district/ may be spent anywhere within the Project boundaries
which permiu "pooling' of increment ftom moa than one district.
3 -year rule: within three yam after the date of certifiee irm one of three things must
happen for the district to remain dive: bonds an issued to aid the Project (excluding
IrhQusaW development mveture boedsr the authority acquits property within the TIF
District or the authoft causer public improvements to be constructed within the TIF
District.
4 -year Irak down rule incremew will not be collected from a particular parcel unless,
within four years after the date of certification, demolition, rehabilitation or renovation
of property or other site itnprovenasts has taken place by elder the authority or the
owner in accordance with the TTP Plan. Coommdon or mtjor reconstruction of an
agjatxnt stroet gusllfiex 0 am improvement to a panel, but utility improvements do not.
If the pared is 'ttrgcked dorm" and !atm improved, It is winsened In the TIF District
but at ten mutat value at the time of the rainy
5 -yew rule: (ler increment to be considered a spent apenditum within the TIF District,
one of the following must Dann within five yeas of eesUftcatiom of the district: (1)
iaranent is paid to a "third pony' for a TIFeligible "acrivity"; (2) bonds. the proceeds
aru4s49 .5-
P11134. a
of which are used to finance an activity, are sold to a third party and proceeds ate
reasonably expected to be spent within the five-year period (with certain limited
exceptions); (3) binding contracts are entered with a third party for performance of an
activity, and increment is spent under the contract; or (0) costs are incurred by a "party"
and revenues are spent to reimburse a party.
The tens "third party' excludes the party receiving TIF assistance and the "municipality
or the development authority at other penton substantially under the control of the
municipality.' Therefore, clause (0) permits the typical "pay as you go" reimbursement
where the initial costs are ineurted by the developer within the 5 -year period. See Section
ID.B.
Noten the 5 -year rule applies only to districts requested for certification after April 30,
1990.
III. TYPE OF FQIANCQYG
agW!. Bonds secured by tax increments are issued when there is a rad for initial capital to
finance public or private improvements. Typically. the bonds ate general obligation bonds backed
by the fall frith and credit of the mtmicipality. As long as at least 20% of the debt service on the
bonds is reasonably expeaed to be paid with tax inatamertn, the bonds may be issued without
elation.
If bonds are issued the authority will typically requite dud the developer sign an "assessment
agtament.' which establishes a minimum market value of the improvements upon completion.
Other types of security may also be teqund, such u a guaranty of debt service in the event of �)
a tax increment deficiency, a letoer of credit during the construction period. or other forms.
Pay As You Go. An alternative to bond fhnatteiag is a 'pay a you go" arrangement with the
developer. The developer pays for various TIF -eligible costs initially, and the authority promises
to mimliunse the developer Rom tax increment over time as it is generated. The developer (rather
than an wreland bondholder) been the risk that the intaaawts will be insufficient to repay the
costs incurred.
This anengemmt may bre sttnxtuted a a revenue am or bond issued to the developer, with an
interest costs to comperusm the developer for ww of financing the improvements up fhmt.
IV. LOCAL GOVMMENT Ala PENALTY
CknetWiv, The penalty, set out in Minn els Statutes, Sectlon 271.1399, applies only to districts
mquested for catif inion after April 30,1990. The patalty is tied to the sate school aid formula
When sn atatttority carates a TB District, the sme callculeltes butte much Inas the sebool aids would
have bees had the apnued pmpce) vdua been available to the «boot dishier. That amount is
then dledtscted firom the myna loud goveasmtal aid (LGA) and if necessary Rom the
homestead and gViattdtal credit aid (WCA).
arnsatas ,6,
rtrua-a
Amount. The LGA/HACA loss varies, but is usually about 30% of the tax increment collected
annually when the maximum penalty applies. Vote that the penalty does not change the amount
of increment collected; it changes the amount of state aid the municipality receives.
The amount of aid loss depends on the type of TIF District:
I . Redevelopment and Housing Districts and Hazardous Substance Subdistricu: the aid loss
is phased in over time. For the fust six years after the original assessment year of the
district them is no aid loss. Beginning in year seven, the loss is only 6.25% of the
maximum possible loss. Each year thereafter, the loss increases in 6.25% increments, until
the full penalty applies in year 21.
2. Renewal and Renovation District: the same 6-year grace period applies, but in year seven
the loss is 12.5 percent of the maximum loss, followed by an additional 12.5% annually
until the full penalty applies in year 12.
3. Soils Condition District and Economic Dervelopment Districu: the maximum penalty
begins in the fust year in whirls increment is collected.
4. "Qualified Manufacturing Dimieu;' these am economic development districts that: am
requested for certification after June 30, 1991; provide assistance to manufacturing,
research and development or telemarketing (but gM tourism &cilities or warehousing);
and we located in a city with a maximum population of 1000. The aid lou is phased
in with 20% petaM of due maximum applied in year two, followed by an addition 20%
each year until the fall penalty applies in year six. 1993 Cbaapt the former requirement
duet the city be located outside a men liters statistical area has been eliminated. Thus,
metro ams cities under 10,000 population an now eligible for the pawed in penalty.
5. 1993 Chimp — Qua Osil 9otniq DMekts this is a housing district for a residential
rental project in which tate only properties receiving TIF assistance mat all the
requirements for a low-income housing credit under federal law, negardku of whether the
project actually receives a howing credit. The tax credit requirements an generally mom
stringent than the irscame requirements otherwise applicable to a housing TIF District.
Than is all LOkHACA penalty for a qualified housing district.
6. 19911 Cbaap — QoagW Raasdoos Sobsta race Sabdbtrlet: this is a hazardous
substance subdistrict for which the municipality elects to pay at least 18% of the cost of
developing and implementing the dwelopmau action response plan. The 18% sham must
be paid by any sources of Orada available other than tax increments. The election must
be made at the time of arofiation of the district, and is irrevocable. Them is no
LOAJHACA pamlty fbr a qualified hazardous substance subdistrict.
I. For disokb crested but aem May 1, 1990 and July 31, 1993, the municipality may
obulm mimbuuwua►t km the developer for loo aid. However, tan Increment may trot
be directly expended to mimbuns the pnaal And lbs nxb aid lop.
2. 1993 Chap: For districts mgtmsted for catifiutim after bdy 31,1993, new restrictions
apply. If any agreement or "wrengematt" provides for the developer to repay any part
was %40 �,
rta>t-a
of the tax increment assistance provided, such developer payments are subject to
restrictions imposed by law on tax increment itself. Thus. a municipality may not deposit
such payments in the general Rmd. but rather must maintain them in the TIF District
account for use only on TIF-cligible activities. As a practical matter, this severely limits
the ability to 611 the aid -loss hole in the municipality's general food.
uwoss
FIRM.,