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98-8557r 15 RESOLUTION NO. 8557 RESOLUTION MODIFYING REDEVELOPMENT PROJECT AREA BAND ADOPTING THE MODIFICATION TO THE REDEVELOPMENT PLAN THERETO; ESTABLISHING WITHIN REDEVELOPMENT PROJECT AREA B, TAX INCREMENT FINANCING DISTRICT B-5 AND ADOPTING THE TAX INCREMENT FINANCING PLAN RELATED THERETO BE IT RESOLVED, by the City Council (the "Council") of the City of Richfield, Minnesota (the "City"), as follows: Section 1. Recitals 1.01 The Housing and Redevelopment Authority in and for the City of Richfield (the "HRA") has heretofore established Redevelopment Project Area 8 and adopted the Redevelopment Plan related thereto. It has been proposed that the City adopt the Modification to the Redevelopment Plan for Redevelopment Project Area Band establish within Redevelopment Project Area 8, Tax Increment Financing District 8-5 ("District 8-5") and adopt the Tax Increment Financing Plan related thereto (collectively, the "Program and Plan"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.001 through 469.170 and 469.174 through 469.179, all inclusive, as amended, all as reflected in the Modification to the Program and Plan, and presented for the Council's consideration. 1.02 The Council has investigated the facts relating to the Program and Plan. 1.03 The City or HRA has performed all actions required by law to be performed prior to the adoption and approval of the proposed Program and Plan, including, but not limited to, notification of Hennepin County and School District No. 280 having taxing jurisdiction over the property to be included in District 8-5, notice of a potential redevelopment district to the local county commissioner, a review of and written comment by the City Planning Commission on the consistency of the Program' and Plan with the City's Comprehensive Plan, and the holding of a pubic hearing upon published notice as required by law. 1.04 Certain written reports (the "Reports") relating to the Program and Plan and to the activities contemplated therein have heretofore been prepared by staff and submitted to the Council and/or made a part of the City files and proceedings on the Program and Plan. The Reports include data, information and/or substantiation constituting or relating to (1) the "studies and analyses" on why the new District 8-5 meets the so-called "but for" test; and (2) the bases for the other findings and determinations made in this resolution. The Council hereby confirms ratifies and adopts the Reports, which are hereby incorporated into and made as fully apart of this resolution to the same extent as if set forth in full herein. Section 2. Findings for the Adoption and Approval of the Program and Plan Resolution No. 8557 -2- 2.01. The Council hereby finds that the Program and Plan, are intended and, in the judgment of this Council, the effect of such actions will be, to provide an impetus for redevelopment in the public purpose and accomplish certain objectives as specified in the Program and Plan, which are hereby incorporated herein. Section 3. Findings for the Establishment of Tax Increment Financing District 8-5. 3.01 The Council hereby finds that Tax Increment Financing District 8-5 is in the public interest and is a "redevelopment district" under Minnesota Statutes, Section 469.174, subd. 10(a)(1). 3.02 The Council further finds that the proposed development would not occur solely through private investment within the reasonably foreseeable future and that the increased market value on the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of District 8-5 permitted by the Tax Increment Financing Plan, that the Program and Plan conform to the general plan for the development of redevelopment of the City as a whole; and that the Program and Plan will afford maximum opportunity consistent with the sound needs for the City as a whole, for the development of District 8-5 by private enterprise. 3.03 The City elects to make a qualifying local contribution in accordance with Minnesota Statutes, Section 273.1399, subd. 6(d) in order to qualify District 8-5 for exemption from state aid losses set forth in Section 273.1399 subd. 6(c). 3.04 The Council further finds, declares and determines that the City made the above findings stated in this Section and has set forth the reasons and supporting facts for each determination in writing, attached hereto as Exhibit A. Section 4. Approval and Adoption of the Program and Plan 4.01 The Program and Plan, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, are hereby approved, ratified. established, and adopted and shall be placed on file in the office of the City Clerk. 4.02 The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Program and Plan and to negotiate. draft, prepare and present to this Council for its consideration all further plans, resolutions. documents and contracts necessary for this purpose. Resolution No. 8557 -3- 4.03 The Auditor of HennepinCounty is requested to certify the original net tax capacity of District 8-5, as described in the Program and Plan, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the City of Richfield is' authorized and directed to forthwith transmit this request to the County Auditor in such form and content as the Auditor may specify, together with a list of all properties within District 8-5, for which building permits have been issued during the 18 months immediately preceding the adoption of this resolution. Adopted by the City Council of the City of Richfield, Minnesota this 23rd day of February, 1998. ~~u Martin J. K , Mayor ATTEST: 11~ P!2L Thomas P. Ferber, City Clerk EXHIBIT A RESOLUTION NO. 8557 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for Tax Increment Financing District 8-5, ("District 8-5") as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: 1. Finding that District 8-5 is a redevelopment district as defined in M.S., Section 469.174, Subd. 10(a)(1). District 8-5 consists of 29 parcels, with plans to redevelop the area for residential purposes. The Council generally believes that each of the parcels in the District are occupied by buildings, streets, utilities, or other improvements and the buildings in District 8-5, not including outbuildings, are structurally substandard to a degree requiring substantial renovation or clearance. 8ecause District 8-5 is a scattered-site redevelopment district, each parcel qualifies individually. These findings are based upon general information about buildings of similar age and construction because building owners did not consent to interior inspections at this time. Prior to a parcel being certified with Hennepin County, an interior inspection will be conducted to confirm that the redevelopment district creation have been met. (See also Appendix D of the Tax Increment Financing Plan for Tax Increment District 8-5). 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of District 8-5 permitted by the Plan. Due to the high cost of redevelopment on the parcels currently occupied by substandard buildings and the cost of financing the proposed improvements, this project is feasible only through assistance, in part, from tax increment financing. A comparative analysis of estimated market values both with and without establishment of Tax Increment Financing District 8-5 and the use of tax increments has been performed as described above. If all development which is proposed to be assisted with tax increment were to occur in District 8-5, the total increased market value would be up to $2,188,200. It is the Council's finding that no development with a market value of greater than $1,586,332 would occur without tax increment assistance in this district within 25 years. This finding is based upon evidence from general past experience with the high cost of acquisition and site improvements in the general area of District 8-5 (see Cashflow in Appendix C of the Program and Plan). 3. Finding that the Tax Increment Financing Plan for District 8-5 conforms to the general plan for the development or redevelopment of the municipality as a whole. The Plan was reviewed by the Planning Commission on January 27, 1998 and found to be in conformance with the general development plan of the City. 4. Finding that the Tax Increment Financing Plan for District 8-5 will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of Redevelopment Project Area B by private enterprise. The project to be assisted by District 8-5 will result in the renovation of substandard properties, increased tax base of the State and add a high quality development to the City.