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2. Modification of Dev District No. 2 and TIF 201 CITY OF CHANHASSEN 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 ' (612) 937-1900 MEMORANDA M ' TO: Don Ashworth, City Manager FROM: Todd Gerhardt, Assistant City Manager ' DATE: May 18, 1989 ' SUBJ: Public Hearing to Consider the Modification of Development District No. 2 and Tax Increment Financing District No. 2-1 In accordance with state law, the City Council must hold a public ' hearing when considering modification to any development district or tax increment financing district. The City Council at their April 10, 1989 meeting adopted a resolution establishing May 22 , ' 1989 as the public hearing to receive citizen comments. Attached for the City Council' s consideration is the proposed Modified Development District ,vo. 2 and Tax Increment Financing ' District No. 2-1 Plan as prepared by Ron Batty of Holmes and Graven Law Firm ( see Attachment #1) . Staff has presented the proposed plan to both the Carver County Board of Commissioners ' and School District 112. The comments received from both of these agencies were in regards to duration of the district, but they voiced no objection to the modification of the district. ' The district was established on October 10 , 1988 and has seven years remaining during which the City could collect taxes from the district. ' The Planning Commission has also reviewed the proposed modifica- tion and found it to be consistent with plans for the development of the City of Chanhassen ( see Attachment #2 ) . ' Recommendation ' Staff recommends the City Council approve the resolution modifying Development District No. 2 and Tax Increment Financing District No. 2-1. ' Attachments 1 . Resolution and Modification to Development District No. 2 and ' TIF District No. 2-1 Plan. 2 . Planning Commission Resolution. 3 . Copy of Public Hearing Notice as Printed in the Villager. 4 . Letter from School District 112. ' 5 . Letter from Carver County. 6 . Maps . Mayor and City Council May 18, 1989 Page 2 Manager' s Comment: The primary purpose of the amendment, from a City standpoint, is to accelerate the repayment of costs asso- ciated with the construction of Audubon Road. The plan does not consider any form of land write-down costs within the project area. However, a reduction of special assessments, using up to three years of taxes generated from new construction, is included in the plan. To this extent, the proposed expansion would con- form with tax increment policies currently being applied within the business park. It should be noted that this is an Economic Development District. 1 Accordingly, any reduction agreements, proposed expenditures , etc. , rest solely with the City Council. \ "(A-)1° (L 1 1 1 1 1 1 1 1 1 1 1 1 CITY OF CHANHASSEN ' CARVER AND HENNEPIN COUNTIES, MINNESOTA RESOLUTION ' Date Resolution No. ' Motion By Seconded By RESOLUTION ADOPTING A MODIFIED DEVELOPMENT PROGRAM FOR DEVELOPMENT ' DISTRICT NO. 2 AND MODIFIED TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 2-1 BE IT RESOLVED By the City Council (the Council) of the City of Chanhassen, Minnesota (the City) as follows: Section 1. Recitals. ' 1.01. On October 10, 1988, the City adopted a Development Program for Development District No. 2 and a Tax Increment Financing Plan for Tax Increment Financing District No. 2-1 therein, all pursuant to and in accordance with ' Minnesota Statutes Section 469.124 through 469.134 and Minnesota Statutes Sections 469.174 through 469.179. ' 1.02. It has been proposed that the City expand the boundaries of Development District No. 2 and of Tax Increment Financing District No. 2-1. 1.03. The Council has investigated the facts and has caused to be prepared ' a modified Development Program for Development District No. 2, describing the additional actions to be undertaken by the City to aid the development of property within Development District No. 2, and has caused to be prepared a modified Tax ' Increment Financing Plan describing the specific acts to be taken to assist development within the expanded boundaries of Tax Increment Financing District No. 2-1. ' 1.04. The City has performed all actions required by law to be performed prior to the enlargement of Development District No. 2 and of Tax Increment Financing District No. 2-1 and the adoption of a modified Development Program ' and Tax Increment Financing Plan relating thereto, including, but not limited to, notification of Carver County and Independent School District No. 112; a review by the City planning commission of the modified Development Program for ' Development District No. 2 and the modified Tax Increment Financing Plan for Tax Increment Financing District No. 2-1 for their consistency with the general plans for development of the City; and holding a public hearing regarding the modified Program and the Plan upon such notice as is required by law. ' 1.05. The modified Development Program and Tax Increment Financing Plan are contained in a document entitled "Modified Development Program, f r r Development District No. 2 and Modified Tax Increment Financing Plan, Tax Increment Financing District No. 2-1, City of Chanhassen, Minnesota," dated May 22, 1989, and on file in the office of the City Manager. ' 1.06. The City Council has fully reviewed the contents of the modified Development Program and Tax Increment Financing Plan and has on this date r conducted a public hearing thereon at which the views of all interested persons were heard. Section 2. Findings Related to the Expansion of Development District No. 2 ' 2.01. The Council hereby finds that the expansion of Development District No. 2 is intended, and in the judgment of the Council, its effect will be to provide r an impetus for additional industrial development in the City, increase employment, and otherwise promote the public purposes and objectives specified in the modified Development Program. ' 2.02. It is further found and determined that: a) The land added to Development District No. 2 would not be made ' available for development without the public intervention and financial assistance described in the modified Development Program and Tax Increment Financing Plan; ' b) The modified Development Program will afford maximum opportunity, consistent with the sound needs of the City as a whole, ' for the development of the District by private enterprise; and c) In accordance with the findings of the planning commission, the modified Development Program conforms to the general plan for ' development of the City as set forth in the City's comprehensive plan. ' Section 3. Findings Related to the Expansion of Tax Increment Financing District No. 2-1. ' 3.01. It is the opinion of the Council that development of the properties included within the expanded boundaries of Tax Increment Financing District No. 2-1 would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future due to the lack of an adequate access road and that the use of tax increment financing is therefore necessary. 3.02. The Council finds that the modified Tax Increment Financing Plan for ' Tax Increment Financing District No. 2-1 conforms to the general plan for development of the City, based upon the recommendations of the planning corn mission. r 3.03. The Council finds that the modified Tax Increment Financing Plan for Tax Increment Financing District No. 2-1 will afford maximum opportunity, consistent with the sound needs of the City as a whole, for development of the expanded District by private enterprise. 3.04. The Council further finds that the enlargement of Tax Increment Financing District No. 2-1 is intended, and in the judgment of the Council, its effect will be to promote the public purposes and accomplish the objectives specified in the modified Tax Increment Financing Plan. 2 1 ' 3.05. The City Council has relied upon the opinions and recommendations of its staff and planning commission and the personal knowledge of the members of the council in reaching its conclusions regarding the expansion of Tax Increment Financing District No. 2-1. 3.06. The City Council hereby reaffirms its finding that Tax Increment Financing District No. 2-1 is an economic development tax increment financing district within the meaning of Minnesota Statutes Section 469.174, Subd. 12. Section 4. Approval of the Modified Development Program and Tax Increment Financing Plan. 4.01. The modified Development Program for Development District No. 2 and the modified Tax Increment Financing Plan for Tax Increment Financing District No. 2-1 are hereby approved and adopted. 4.02. The expanded boundaries of Development District No. 2 and of Tax ' Increment Financing District No. 2-1 are described in the modified Development Program and modified Tax Increment Financing Plan therefor and are incorporated herein by reference. 4.03. The City elects to be governed by Minnesota Statutes Section 469.177, Subd. 3 with regard to fiscal disparities for expanded Tax Increment Financing ' District No. 2-1. 4.04. The City Manager is authorized and directed to transmit a certified copy of this resolution together with a certified copy of the modified Development ' Program and Tax Increment Financing Plan to the auditor of Carver County with a request that the original tax capacity of the property hereby added to Tax Increment Financing District No. 2-1 be certified to the City pursuant to Section ' 469.177, Subd. 1 of the Tax Increment Financing Act and to file a copy of the modified Development Program and modified Tax Increment Financing Plan with the Minnesota Commissioner of Trade and Economic Development. DATED: , 1989. 1 _ Donald Chmiel, Mayor ATTEST: Donald Ashworth, City Clerkanager ' CH130-011 3 i I w 1 1 1 1 MODIFIED DEVELOPMENT PROGRAM DEVELOPMENT DISTRICT NO. 2 1 and ' MODIFIED TAX INCREMENT FINANCING PLAN, TAX INCREMENT FINANCING DISTRICT NO. 2-1 CITY OF CHANHASSEN, MINNESOTA May 22, 1989 1 ' Prepared by: Holmes & Graven, Chartered 470 Pillsbury Center Minneapolis, MN 55402 ( 612) 337-9262 so ITable of Contents Page ISection I . Modified Development Program for Development District No. 2 ISubsection A. Definitions 1 Subsection B. Statutory Authority 2 Subsection C. Statement of Objectives 2 II Subsection D. Environmental Controls 3 Subsection E. Open Space to be Created 3 Subsection F. Public Facilities to be Constructed . 3 I Subsection G. Proposed Reuse of Property 3 Subsection H. Development District Financing 4 Subsection I . Administration of Development District4 I Subsection J. Rehabilitation 4 Subsection K. Description of Development District 4 Section II . Modified Tax Increment Financing Plan for Tax IIncrement Financing District No. 2-1 Subsection A. Statutory Authority 5 I Subsection B. Statement of Objectives Subsection C. Statement of Public Purpose 5 Subsection D. Development District Program 6 I Subsection E. Description of TIF District 6 Subsection F. Development District Contracts 6 Subsection G. Classification of TIF District 6 Subsection H. Modification of TIF Plan 6 I Subsection I . Use of Tax Increment 7 Subsection J. Excess Tax Increment 7 Subsection K. Limitation on Increment 7 I Subsection L. Limitation on Administrative Expenses 8 Subsection M. Limitation on Boundary Changes 8 Subsection N. Relocation 9 Subsection 0. Parcels to be Acquired within TIF I District 9 Subsection P. TIF Account 9 Subsection Q. Estimate of Costs 9 I Subsection R. Estimate of Bonded Indebtedness . . . 9 Subsection S. Original Assessed Value 9 Subsection T. Estimate of Captured Assessed Value . 10 I Subsection U. Duration of TIF District 10 Subsection V. Alternate Estimates of Impact on Other Taxing Jurisdictions 11 Subsection W. Annual Financial Report 12 I Subsection X. Notification of Prior Planned Improvements 13 Subjection Y. Assessment Agreements 13 I I I/ BE SECTION I . MODIFIED DEVELOPMENT PROGRAM FOR DEVELOPMENT ' DISTRICT NO. 2 A. Definitions For the purposes of the Development District Program and ' Tax Increment Financing Plan, the following terms shall have the meanings specified below, unless the context otherwise requires: "City" means the City of Chanhassen, a municipal corporation under the laws of the state of Minnesota; ' "Comprehensive Plan" means the City' s Comprehensive Plan, including the objectives, policies, standards and programs to guide public and private land use, development, redevelopment and preservation for all lands and water within the City; "City Council" or "Council" means the Chanhassen City Council; "City Development District Act" or "Act" means Minnesota Statutes, Sections 469 . 124 through 469 . 134, as amended; ' "County" means Carver County, Minnesota; "Development District" means Development District No. 2 ' which was established on October 10 , 1988, pursuant to and in accordance with the City Development District Act, and which is hereby being expanded; ' "Development Program" or "Program" means the Development Program for Development District No. 2, which adopted by the 11 Council on October 10, 1988, and is hereby being modified; "Project Area" or "Project" means the property within Development District No. 2, as described in the Development ' Program; "State" means the State of Minnesota; ' "Tax Increment Bonds" means any general obligation or revenue tax increment bonds issued by the City to finance the ' public costs associated with Development District No. 2 as stated in the Program and in the Plans for all Tax Increment Financing Districts within Development District No. 2 or any obligations issued to refund the Tax Increment Bonds; "Tax Increment Financing District" means Tax Increment Financing District No. 2-1, which was established on 1 I 1 1 1 I I t I 1 I I I I I I 1 I I I I. II IIOctober 10, 1988, pursuant to and in accordance with the TIF Act and which is hereby being expanded; II "Tax Increment Financing Act" or "TIF Act" means Minnesota Statutes, Sections 469 . 174 through 469 . 179 , inclusive, as amend- 11 ed; and "Tax Increment Financing Plan" or "Plan" means the TIF Plan for TIF District No. 2 which was adopted by the Council on IIOctober 10, 1988, and which is hereby being modified. B. Statutory Authority IIThe City has determined that it is necessary, desirable and in the public interest to establish, designate, develop and I administer a Development Program for Development District No. 2 in the City, pursuant to the provisions of the Act . The City has also determined that the funding of the necessary activities and improvements in Development District No. 2 shall be II accomplished in part or in whole through tax increment financing in accordance with the TIF Act . 1 C. Statement of Objectives The City seeks to achieve the following objectives through Ithe Development Program: 1 . promote and secure the prompt development of property in Development District No. 2 in a manner consistent II with the Comprehensive Plan and with minimal adverse impact on the environment, which property is currently less productive because of the lack of proper utili- ' zation and lack of investment, thus promoting and securing the development of other land in the City; 2 . promote and secure additional employment opportunities 11 within Development District No. 2 and the City for residents of the City and the surrounding area, thereby improving living standards and preventing I unemployment and the loss of skilled labor and other human resources in the City; I 3 . secure the increase of property subject to taxation by the City, county, school district , and other taxing jurisdictions in order to better enable such entities to pay for public improvements and governmental Iservices and programs required to be provided by them; I 4 . secure the construction and provide moneys for the payment of the cost of public activities or improve- ments in Development District No. 2 , including I2 I/ improvements to Audubon Road and the construction of Audubon Court, which are necessary for the orderly and 1 beneficial development of the Development District; and 1 5. promote the concentration of appropriate development within Development District No. 2 in order to maintain the area in a manner consistent with its significance ' to the City. D. Environmental Controls It is anticipated that no development within the Development District will present major environmental concerns . All City actions, public improvements and private development 1 will be carried out in a manner which will comply with applicable environmental standards . E. Open Space to be Created 1 Any open space within the Development District will be created in accordance with the development controls of the City. F. Public Facilities to be Constructed ' Public facilities constructed within the Development Dis- trict will be financially feasible and compatible with the City ' s long range development plans. Public improvements proposed within Development District No. 2 include upgrading of Audubon Road from State Highway No. 5 to Lyman Boulevard. The improvements to Audubon Road from State Highway No. 5 south to the Chicago, Milwaukee, St. Paul & Pacific Railroad tracks will ' be the first phase of the project . Improvement of Audubon Road from the railroad tracks south to Lyman Boulevard will occur in the second phase. ' In addition, the City proposes to construct Audubon Court westerly from Audubon Road. Audubon Court will provide access to the newly created lots to the south of the McGlynn 1 development. G. Proposed Reuse of Property ' It is not currently anticipated that any property will be acquired in connection with the proposed development within Development District No. 2 . Future proposals for the use of property to be acquired by the City must be consistent with Development Program objectives and financially feasible. Prior to acquisition of any property for reuse by a private developer , ' the City Council may require a development contract and other guarantees to ensure that sufficient tax increment or other funds will be available to repay the cost associated with the ' 3 1 proposed acquisition. Appropriate restrictions regarding the reuse and redevelopment of property shall be incorporated into 11 any development contract to which the City is a party. H. Development District Financing Within Development District No. 2, the City has created one TIF District and may create additional TIF Districts to finance development activities . Roadway improvement costs which will be ' incurred in Development District No. 2 will be paid through the pledge of tax increment from TIF District No. 2-1 . I . Relocation. The City anticipates that no relocation will be necessary but accepts its responsibility for providing for relocation ' pursuant to Section 469 . 133 of the City Development District Act. If relocation is necessary, provisions will be made in accordance with Minnesota Statutes, Sections 117 . 50 through 117 . 56, inclusive. J. Administration of Development District . ' Maintenance and operation of the public improvements will be the responsibility of the Administrator of Development District No. 2 . Each year the Administrator will submit to the ' City Council the maintenance and operation budget for the following year . The Administrator will administer the Development District pursuant to the provisions of Section 469 . 131 of the City Development District Act; provided, however , that such powers may only be exercised at the direction of the City Council. No action taken by the Administrator shall be effective without authorization by the City Council. The City does not anticipate the need to create an advisory board to advise the City Council on the planning, construction or implementation of the activities and improvements outlined in the Development District Program. K. Description of Development District . A description and a map of the boundaries of Development District No. 2 were included with the original Program and Plan. Attached to this modification as Exhibit A is a description of the property hereby added to Development District No. 2 . Attached hereto as Exhibit B is a map of the property being added to the Development District by this modification. ' 4 mil IISECTION II . MODIFIED TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT IIA. Statutory Authority. Pursuant to Section 469 . 175 , Subd. 4 of the TIF Act , the II Cit has adopted the Plan for TIF District No. 2-1 and has y 1 within Development District No. established TIF District No. 2- II 2 . B. Statement of Objectives . t I n addition to the objectives outlines Sectifollowing on subjec- vision C hereof , the City seeks to achieve tives through the Plan for TIF District No. 2-1 : II1 . provide employment opportunities within the City; II 2 . improve the tax base of the City and the general economy of the City and state; II 3 . encourage development in an area of the City which has not been utilized to its full p otential; 4 . provide for roadway improvements ; and II5 . implement relevant portions of the Comprehensive Plan. 1 C. Statement of Public Purpose• I In adopting the modified Program and Plan, the City Council intends to make the following findings: not reasonably be 1 . Anticipated development would rivea investment I expected to occur solely throug h P within the reasonablyforeseeabeeessarfuture and, there- fore, the use of TIF is 2 . The TIF Plan will afford maximum opportunity, conss- ttent with the sound needs of the enterprisee, a io development of the District by private I3 . The TIF Plan conforms to general plans for development of the City as a whole. paragraph 1 of this subdivision and I The conclusion summarized in P aCity upon approval of this which will be adopted by the the modification is one which has been rea hed commission City Council the Ci and city I following consultation with the planning 1 5 I I I I 1 1 I I I 1 I I I I I I 1 t m. I/ . IIstaff . The conclusion has also been reached based upon the personal knowledge of members of the City Council regarding the IIproperty and development trends within the City. D. Development District Program. IThe City created Development District No. 2 at the same time as creation of TIF District No. 2-1 . A Program has been adopted to describe development activities planned or II authorized within the Development District and is included as Section I of this Plan. IE. Description of TIF District . A description and a map of the boundaries of TIF District No. 2-1 was included with the original Program and Plan. II Attached to this modification as Exhibit C is a description of the property hereby added to TIF District No. 2-1 . Attached hereto as Exhibit D is a map of the property being added to TIF IDistrict No. 2-1 by this modification. F. Development District Contracts . IThe City has not entered into any development contracts for properties within TIF District No. 2-1 . If necessary, contracts regarding property within the Development District will be I entered into in accordance with Section 469 . 176 , Subd. 5 of the TIF Act and no more than 10 percent, by acreage, of the land within TIF District No. 2-1 will be acquired by the City with I bond proceeds without having concluded an agreement for develop- ment or redevelopment of the property. G. Classification of TIF District . II TIF District No. 2-1 is an economic development TIF district, pursuant to Section 469 .174, Subd. 12 of the TIF Act. 1 H. Modification of TIF Plan. 1 The Plan for TIF District No. 2-1 may be modified by the City, provided that any reduction or enlargement of geographic ' area of the TIF District , increase in amount of bonded indebted- ness to be incurred, including a determination to capitalize interest on the debt if that determination was not a part of the original plan, or to increase or decrease the amount of interest Ion the debt to be capitalized, increase in the portion of the captured assessed value to be retained by the City, increase in total estimated tax increment expenditures or designation of I additional property to be acquired by the City shall be approved upon the notice and after such discussion, public hearing and findings as required for approval of the original Plan. II 6 I/ IIThis modification is the first modification of the Program and Plan. The City may choose to modify the Program and the II Plan again if necessary to further promote development within or adjacent to the District. II . Use of Tax Increment . Pursuant to Section 469 . 176, Subd. 4 of the TIF Act , all 1 revenues derived from TIF District No. 2-1 shall be used in accordance with the TIF Plan. The revenues shall be used to finance or otherwise pay the capital and administrative costs of development activities within the Development District as Iidentified in the Development Program and TIF Plan. J. Excess Tax Increment . ' Pursuant to Section 469 . 176, Subd. 2 of the TIF Act, in any year in which the increment exceeds the amount necessary to pay the costs authorized by the TIF Plan, the City shall use the 11 excess amount to do any of the following, in the order determined by the City: II1. prepay the outstanding bonds; 2. discharge the pledge of tax increment therefor; II3 . pay into an escrow account dedicated to the payment of bonds; or II 4. return the excess amount to the Carver county auditor who shall distribute the excess amount to the City, the county, and the school district in direct Iproportion to their respective tax capacity rates. In addition, the City may choose to modify the TIF Plan 1 again in order to provide for other public improvements within the Development District. K. Limitation of Increment. II1. No increment shall be paid to the City from TIF Dis- trict No. 2-1 after three years from the date of II certification of the original tax capacity of the taxable real property in the District by the county auditor unless within the three year period (a) bonds II have been issued pursuant to Section 469 . 178 of the TIF Act, or (b) the City has acquired property within TIF District No. 2-1, or (c) the City has constructed or caused to be constructed public improvements IIwithin TIF District No. 2-1. II 7 II r II 2 . If, after four years from the date of certification of II the original tax capacity of TIF District No. 2-1 , no demolition, rehabilitation, or renovation of property or other site preparation, including improvement of a street or right-of-way adjacent to a parcel but not II installation of underground utility service, including sewer or water systems, have been commenced on a parcel located within TIF District No. 2-1 by the I City, or by the owner of the parcel in accordance with the TIF Plan, no additional increment may be taken from that parcel, and the original tax capacity of that parcel shall be excluded from the original I tax capacity of the TIF District . If these activities subsequently commence, the City shall so certify to the county auditor , and the tax capacity of the ' property commissioner o as f most recently certified by the revenue may be added to the TIF District. The City shall submit to the county I auditor evidence that the required activity has taken place for each parcel in TIF District No. 2-1. The evidence shall be submitted by February 1 of the fifth year following the year in which the parcels I were certified as included within TIF District No. 2- 1 . I 3 . No tax increment shall in any event be paid to the City from TIF District No. 2-1 after eight years from the date of receipt by the City of the first increment or 10 years from the date of approval of the TIF Plan, 1 whichever occurs first. L. Limitation on Administrative Expenses. IIPursuant to Section 469. 176, Subd. 3 of the TIF Act, admin- istrative expenses are limited to 10 percent of the total tax II increment expenditures. Each time the City increases the budget of TIF District No. 2-1, the amount of tax increment money allocated to administrative costs may be increased as long as the total of administrative expenditures does not exceed 10 I percent of the total budget of the TIF District . Admin- istrative expenses mean all expenditures of the City other than amounts paid for the purchase of land or amounts paid to 1 contractors or others providing materials and services, including architectural and engineering services, directly connected with the physical development of real property in the I District, relocation benefits paid to or services provided for persons residing or businesses located in the District, or amounts used to pay interest on, fund a reserve for , or sell at a discount bonds issued pursuant to Section 469 . 178 of the TIF I Act . Administrative expenses includes amounts paid for services provided by bond counsel, fiscal consultants and planning or economic development consultants . II 8 II I/ M. Limitation on Boundary Changes. • ' The geographic area of TIF District No. 2-1 may be reduced, but it cannot be enlarged after five years following the date of certification of the original tax capacity by the Carver county ' auditor . This modification, which includes an expansion of the boundaries of TIF District No. 2-1, is occurring within five years of the date of certification of the TIF District . N. Relocation. Although no relocation is anticipated, the City accepts as ' binding its obligations under state law for relocation and will administer relocation services for families , individuals and businesses displaced by public action. 1 0. Parcels to be Acquired Within the TIF District . It is not anticipated that any property will be acquired in connection with development proposals contained in the TIF Plan. P. TIF Account . ' The tax increment received with respect to TIF District No. 2-1 shall be segregated by the City in a special account on its official books and records and held by a trustee for the benefit of holders of bonds issued to finance development activities . Q. Estimate of Project Costs. ' The estimated budgeted amounts for the original TIF District were included in the Plan adopted on October 10 , 1988 . The following represent additional amounts which will be expended within TIF District No. 2-1 as a result of this modification: Special Assessment Reduction Program $ 273,000 Administrative Expenses 27,000 ' Total $ 300 ,000 The City intends to construct Audubon Court and to assess ' the cost thereof to the benefitted properties . The land hereby added to TIF District No. 2-1 will be eligible for the City' s special assessment reduction program. Under that program, special assessments levied against improved properties will be ' reduced by an amount equal to the tax increment generated by the property during the first three years after full value of the improvements is in place . ' 9 R. Estimate of Bonded Indebtedness. The City has previously sold bonds to pay for the improvements to Audubon Road. The City does not intend to sell additional tax increment bonds to pay for the construction of ' Audubon Court. Costs for the construction of Audubon Court will be met by bonds sold pursuant to Minnesota Statutes, Chapter 429 and will be assessed against benefitted properties . S. Original Tax Capacity. Pursuant to Section 469 . 177 , Subd. 1 of the TIF Act, each ' year the Carver county auditor will measure the increase or decrease in the total tax capacity of the property. Any year in which there is an increase in total tax capacity of property ' within the TIF District, an increment will be payable to the City. Any year in which the total tax capacity is below the original tax capacity of all property within TIF District No. 2- 1, no increment will be payable to the City. ' Each year after the certification of the original tax capacity, the county auditor will increase or decrease the ' original tax capacity of property within TIF District No. 2-1 as a result of: 1. change in the tax exempt status of the property; 2 . reduction or enlargement of the geographic boundaries of the TIF District; 34 reduction of valuation by means of a court-ordered abatement, stipulation agreement, voluntary abatement made by the assessor or auditor or by order of the Minnesota commissioner of revenue; or 4 . any change in tax classification under Minnesota Statutes Section 273 . 13 of property after it has been added to the TIF District . ' In addition, each year the auditor shall add to the original tax capacity of TIF District No. 2-1 an amount equal to the original tax capacity for the preceding year multiplied by ' the average percentage increase in tax capacity of all property within the TIF District during the preceding five years. T. Estimate of Captured Tax Capacity. Pursuant to Sections 469 . 175, Subd. 1 and 469 . 177 , Subd. 2 of the TIF Act, the estimated captured tax capacity of the ' property within the enlarged boundaries of TIF District No. 2-1 will be $207 ,000 upon full development . The captured tax capacity was estimated in the following manner : 10 additional tax increment bonds to pay for the construction of Audubon Court.- Costs for the construction of Audubon Court will ' be met by bonds sold pursuant to Minnesota Statutes, Chapter 429 and will be assessed against benefitted properties . S. Original Tax Capacity. Pursuant to Section 469 . 177, Subd. 1 of the TIF Act, each year the Carver county auditor will measure the increase or ' decrease in the total tax capacity of the property. Any year in which there is an increase in total tax capacity of property within the TIF District, an increment will be payable to the ' City. Any year in which the total tax capacity is below the original tax capacity of all property within TIF District No. 2- 1, no increment will be payable to the City. Each year after the certification of the original tax capacity, the county auditor will increase or decrease the original tax capacity of property within TIF District No. 2-1 as a result of: 1. change in the tax exempt status of the property; 2 . reduction or enlargement of the geographic boundaries of the TIF District; 3 . reduction of valuation by means of a court-ordered abatement, stipulation agreement, voluntary abatement made by the assessor or auditor or by order of the Minnesota commissioner of revenue; or 4. any change in tax classification under Minnesota ' Statutes Section 273 . 13 of property after it has been added to the TIF District. In addition, each year the auditor shall add to the original tax capacity of TIF District No. 2-1 an amount equal to the original tax capacity for the preceding year multiplied by the average percentage increase in tax capacity of all property ' within the TIF District during the preceding five years. T. Estimate of Captured Tax Capacity. Pursuant to Sections 469 . 175, Subd. 1 and 469 . 177 , Subd. 2 of the TIF Act, the estimated captured tax capacity of the property within the enlarged boundaries of TIF District No. 2-1 will be $207 ,000 upon full development. The captured tax capacity was estimated in the following manner : ' Tax Capacity lg9p� $ Z.--z-7( r4 11 sol IOriginal Tax Capacity - Captured Tax Capacity $ I I I I I I I I I I I I I I 1 12 I En II Tax Capacity 1 upon- full development $ 227,000 - Original Tax Capacity 20 , 000 ICaptured Tax Capacity $ 207 ,000 Pursuant to Section 469 . 177 , Subd. 2 of the TIF Act, it is I found and declared that all of the captured tax capacity generated by TIF District No. 2-1 is necessary to finance or otherwise make permissible expenditures authorized by Section 469 . 176, Subd. 4 of the TIF Act . IIU. Duration of the TIF District . I In accordance with Section 469 . 176 , Subd. 1 of the TIF Act, the City may continue to receive TIF payments until eight years from the date of the receipt of the first increment or 10 years I from the date of the approval of the TIF Plan, whichever occurs first . It is likely that the City will request that the Carver I county auditor retain the increment payable in 1990 . The reason for this request is that the City anticipates that the 1990 increment will be a partial one and it wishes to preserve its Istatutory right to receive eight years of full increment . V. Estimates of Impact on Other Taxing Jurisdiction. IIt is anticipated that $207,000 in increment will be cap- tured annually from the property being added to TIF District No. 2-1 as a result of this modification after calculation of the II fiscal disparities contribution. Of this amount, approximately the following amounts would have gone to the taxing jurisdictions: ITax Jurisdiction Tax Increment City of Chanhassen $ 43 , 200 I Carver County $ 62 , 400 Independent School District No. 112 $ 95, 400 IOther $ 6, 000 However , the City believes that the actual impact on all I taxing jurisdiction is zero because, in the City ' s opinion, no development is likely to occur on the property without public assistance. I I 11 II W. Annual Financial Report. Pursuant to Section 469 . 175, Subd. 6 of the TIF Act, the ' City must file aR annual financial report regarding TIF District No. 2-1. The report shall be filed by July 1 of each year with the school board, the county board and the state auditor . The ' report to be filed by the City shall include the following information: ' 1 . the original tax capacity of TIF District No. 2-1 ; 2 . the captured tax capacity of TIF District No. 2-1, ' including the amount of any captured tax capacity shared with other taxing districts; 3 . the outstanding principal amount of bonds issued or ' other loans incurred to finance project costs in TIF District No. 2-1 ; 4 . for the reporting period and for the duration of TIF District No. 2-1 , the amount budgeted under the TIF Plan and the actual amount expended for the following ' categories : a) acquisition of land and buildings through condem- nation or purchase; ' b) site improvement or preparation costs; ' c) installation of public utilities or other public improvements; d) administrative costs, including the allocated cost of the City; 5. for properties sold to developers, the total cost of ' the property to the City and the price paid by the developer; and ' 6 . the amount of tax exempt obligations, other than those reported under clause ( 3) , which were issued on behalf of private entities for facilities located in TIF District No. 2-1. ' X. Notification of Prior Planned Improvement . Pursuant to Section 469 . 177 , subd. 4, of the TIF Act , the City has reviewed its records with regard to the property to be added to TIF District No. 2-1 and has found that no building ' permits have been issued during the 18 months immediately preceding approval of the modified TIF Plan by the City. 12 Y. Assessment Agreements. Pursuant ' to Section 469 .177 , Subdivision 8 of the TIF Act, ' the City may, ,upon entering into a development agreement pursuant to Section 469 .176, Subdivision 5 of the TIF Act, execute an agreement in recordable form with the developer ' which establishes a minimum market value of the land and completed improvements for the duration of TIF District No. 2- 1 . The agreement shall be presented to the Carver county ' assessor who shall review the plans and specifications for the improvements to be constructed, review the market value previously assigned to the land upon which the improvements are to be constructed and so long as the minimum market value ' contained in the agreement appears in the judgment of the assessor to be a reasonable estimate, the assessor may certify the minimum market value agreement . 1 1 ' CH130-011 I 1 ' 13 1 CITY OF CHANHASSEN ' CARVER AND HENNEPIN COUNTIES, MINNESOTA RESOLUTION Date May 17, 1989 Resolution No. 89-1 ' Motion By Conrad Seconded By Wildermuth RESOLUTION FINDING THE MODIFIED DEVELOPMENT PROGRAM FOR DEVELOPMENT ' DISTRICT NO. 2 AND MODIFIED TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 2-1 ' CONSISTENT WITH THE PLANS FOR DEVELOPMENT OF THE CITY OF CHANHASSEN WHEREAS, the Chanhassen City Council has authorized preparation of a modified Development Program (Program) for Development District No. 2 and a ' modified Tax Increment Financing Plan (Plan) for Tax Increment Financing District ' No.2-1 and the Program and Plan have been submitted to the Planning Commission for comment; and ' WHEREAS, the Planning Commission has made a thorough review of the Program and Plan and has compared them with the plans for development of the City as a whole. ' NOW, THEREFORE, BE IT RESOLVED By the Planning Commission of the City of Chanhassen, Minnesota as follows: ' 1. The Modified Program for Development District No. 2 and the modified Plan for TIF District No. 2-1 are found to be consistent with the plans for development of the City of Chanhassen as a whole. ' 2. It is recommended that the City Council of the City of Chanhassen hold the public hearing required by law and adopt the modified Program and Plan. ' Passed this 17th day of May , 1989, by the Planning Commission of the City of Chanhassen, Minnesota. Chairperson ' ATTEST: Secretary / ' CH130-11 1 1 Public i notices • i CITY OF CHANHASSEN CAAVER AND HENNEPIN COUN- TIES, MINNESOTA NOTICE OF PUBLIC HEARING , MODIFICATION OF DEVELOP- MENT DISTRICT NO.2 AND TAX INCREMENT FINANCING DISTRICT NO. 2-1 NOTICE IS HEREBY GIVEN that 'the Chanhassen City Council will hold a 'public hearing on Monday,May 22,1989 'at 7:30 p.m.in the Council Chambers in Chanhassen City Hall,690 Coulter Drive, Chanhassen,Minnesota. The purpose of this meeting is to conduct a public hear- ing on the modification of Development District No.2 and Tax Increment Financ- ing District No.2-1. The purpose of the modification is to expand the boundaries of both the developtent district and the tax increment financing district in order to assist additional development. A copy of the modified plan is avail- able for public inspection at Chanhassen City Hall during regular business hours. Any person wishing to express an opinion on the matters to be considered at the public hearing will be heard orally or in writing. BY ORDER OF THE CHANHASSEN CITY COUNCIL Todd Gerhardt Assistant City Manager Phone: 937-1900 Dated:April 24, 1989 (Published in the Chanhassen Villager, Thursday, May 4, 1989;No.153) 1 1 1 1 1 CITY OF C ;-..„;:A E i 1, ,WHASSEN \ I ' 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 °,,, (612) 937-1900 May 9 , 1989 School Board Members Independent School District 112 Attn: Mr. Robert Ostlund 1700 Chestnut Street Chaska, MN 55318 Re: Modification of Tax Increment District Dear Mr. Ostlund: Attached you will find an estimate by the City of Chanhassen regarding the fiscal and econo_nic implications regarding the modification of Development District No. 2 and Tax Increment Financing District No. 2-1. The modification to this plan speci- fically deals with expanding the Tax Increment District boundaries to include a 20 acre subdivision ( see Attachment #1) . The City of Chanhassen understands chat tax increment districts are not readily received by counties and school districts; however, the increment generated from this development will solely be used to reduce the costs associated with the public improvements of Audubon Court. The Chanhassen City Council has scheduled a public hearing for Monday, May 22, 1989 at 7 : 30 p.m. in the Council Chambers at City Hall. The purpose of this hearing is to receive public comments on the adoption of the modification of Development District No. 2 and Tax Increment Financing District No. 2-1 ( see Attachment #2) . The City of Chanhassen has always worked well with the School District and County in the past and your input on this plan is very important. I would like to provide our City Council with your written com- ments about the proposed plan in my report for the May 22nd public hearing. If you need any additional information on the proposed plan or the project, please do not hesitate to call me. I would also like the opportunity to meet with the School Board at their '11'7' ;1" 'tit) / II C I A i®