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HomeMy WebLinkAboutResolution No. 2019-24 Establishing 72nd & France TIF District and TIF Plan41NA1 ,H��.,(.E o Councilmember S CITY OF EDINA COUNTY OF HENNEPIN STATE OF MINNESOTA "sib introduced the following resolution and moved its adoption: RESOLUTION 2019-24 ESTABLISHING THE 72ND AND FRANCE TAX INCREMENT FINANCING DISTRICT AND ADOPTING A TAX INCREMENT FINANCING PLAN BE IT RESOLVED by the City Council (the "Council") of the City of Edina, Minnesota (the "City"), as follows: Section I. Recitals. 1.01. The Board of Commissioners of the Edina Housing and Redevelopment Authority (the "HRA") have heretofore established the Southeast Edina Redevelopment Project Area (the "Project Area") and adopted a Redevelopment Plan therefor. It has been proposed by the HRA and the City that the City approve and the HRA adopt a Modification to the Redevelopment Plan for the Project Area (the "Redevelopment Plan Modification") and establish the 72nd and France Tax Increment Financing District (the "District") therein and the City approve and HRA adopt a Tax Increment Financing Plan (the "TIF Plan") therefor (the Redevelopment Plan Modification and the TIF Plan are referred to collectively herein as the "Plans"); all pursuant to and in conformity with applicable law, including Minnesota Statutes, Sections 469.001 to 469.047 and Sections 469.174 to 469.1794, all inclusive, as amended, (the "Act") and Minnesota Session Laws 2014, Chapter 308, Article 6, Section 8, as amended by Minnesota Session Laws 2017, First Special Session Chapter I, Article 6, Sections 1 I and I6 (the "Special TIF Housing Legislation") all as reflected in the Plans, and presented for the Council's consideration. 1.02. The HRA and City have investigated the facts relating to the Plans and have caused the Plans to be prepared. 1.03. The HRA and City will have performed all actions required by law to be performed prior to the establishment of the District and the adoption and approval of the proposed Plans, including, but not limited to, notification of Hennepin County, Independent School District No. 273 having taxing jurisdiction over the property to be included in the District, a review of and written comment on the Plans by the City Planning Commission, approval of the Plans by the HRA on March 19, 2019, and the holding of a public hearing upon published notice as required by law. 1.04. Certain written reports (the "Reports") relating to the Plans and to the activities contemplated therein have heretofore been prepared by staff and consultants and submitted to the Council and/or made a part of the City files and proceedings on the Plans. The Reports include data, information and/or substantiation constituting or relating to the basis for the other findings and determinations made in this resolution. The Council hereby confirms, ratifies and adopts the Reports, which are hereby incorporated into and made as fully a part of this resolution to the same extent as if set forth in full herein. CITY OF EDINA 4801 West 50th Street • Edina, Minnesota 55424 Resolution 2019-24 Page 2 1.05. The City is not modifying the boundaries of the Project Area, but is however modifying the Redevelopment Plan therefor to include activities related to the District. Section 2. Findings for the Adoption and Approval of the Redevelopment Plan Modification. 2.0I The Council approves the Redevelopment Plan Modification, and specifically finds that: (a) the land within the Project area would not be available for redevelopment without the financial aid to be sought under this Redevelopment Plan; (b) the Redevelopment Plan, as modified, will afford maximum opportunity, consistent with the needs of the City as a whole, for the development of the Project by private enterprise; and (c) that the Redevelopment Plan, as modified, conforms to the general plan for the development of the City as a whole. Section 3. Findings for the Establishment of the 72nd and France Tax Increment Financing District. 3.01. The Council hereby finds that the District is in the public interest and is a "housing district" under Minnesota Statutes, Section 469.1 74, Subd. I I of the Act and the Special TIF Housing Legislation. 3.02 The Council further finds that the proposed development would not occur solely through private investment within the reasonably foreseeable future, that the TIF Plan conforms to the general plan for the development or redevelopment of the City as a whole; and that the TIF Plan will afford maximum opportunity consistent with the sound needs of the City as a whole, for the redevelopment or development of the District by private enterprise. 3.03. 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. 3.04. The HRA elects to calculate fiscal disparities for the District in accordance with Minnesota Statutes, Section 469.177, Sudb. 3, clause b, which means the fiscal disparities contribution would be taken from inside the District. Section 4. Public Purpose. 4.01. The adoption of the Plans conforms in all respects to the requirements of the Act and will help fulfill a need to develop and area of the City which is already built up, to provide housing opportunities, to improve the tax base and to improve the general economy of the State and thereby serves a public purpose. For the reasons described in Exhibit A, the City believes these benefits directly derive from the tax increment assistance provided under the TIF Plan. A private developer will receive only the assistance needed to make the development financially feasible. As such, any private benefits received by a property owner are incidental and do not outweigh the primary public benefits. Section 5. Approval and Adoption of the Plans. Resolution 2019-24 Page 3 5.0I . The Plans, as presented to the Council on this date, including without limitation the findings and statements of objectives contained therein, are hereby approved, ratified, established, and adopted and shall be placed on file in the office of the HRA Executive Director. 5.02. The staff of the City, the City's advisors and legal counsel are authorized and directed to proceed with the implementation of the Plans and to negotiate, draft, prepare and present to this Council for its consideration all further plans, resolutions, documents and contracts necessary for this purpose. 5.03 The Auditor of Hennepin County is requested to certify the original net tax capacity of the District, as described in the Plans, and to certify in each year thereafter the amount by which the original net tax capacity has increased or decreased; and the HRA is authorized and directed to forthwith 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 the District, for which building permits have been issued during the I8 months immediately preceding the adoption of this resolution. 5.04. The HRA Executive Director is further authorized and directed to file a copy of the Plans with the Commissioner of the Minnesota Department of Revenue and the Office of the State Auditor pursuant to Minnesota Statutes 469.I75, Subd. 4a. • Th: Q otion for the adoption of the foregoing resolution was duly seconded by Council member , an J upon a vote be' take th reon, the fQl`owig votd in favor thereof: s and the following voted against the same: Dated: March 19, 2019 Sharon Allison, City Clerk (Seal) James B. Hovland, Mayor Resolution 2019-24 Page 4 EXHIBIT A RESOLUTION NO. 2019- 24 The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for the 72nd and France Tax Increment Financing District as required pursuant to Minnesota Statutes, Section 469.175, Subdivision 3 are as follows: Finding that the 72nd and France Tax Increment Financing District is a housing district as defined in M.S., Section 469.174, Subdivision I I and the Special TIF Housing Legislation. The 72nd and France Tax Increment Financing District (the "District") consists of two parcels within the City's Southeast Edina Redevelopment Project Area. The portion of the development receiving assistance is proposed to be constructed as two mixed -use buildings containing approximately 301 units of rental housing and at least 20 percent of the units receiving assistance will have incomes at or below 60 percent of statewide median income. No more than 20% of the square footage of the buildings will consist of commercial, retail or other nonresidential uses. Appendices A and E of the TIF Plan contains background for the above finding. 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future. This finding is supported by the fact that the development proposed in the TIF Plan is a housing district that meets the City's objectives for redevelopment and is intended for occupancy by low and moderate -income persons. The existing property contains structures whose renovation requires high costs related to demolition, remediation and reconstruction. The development also requires substantial investment toward public improvement such as local transportation and utility infrastructure and shared parking. Due to the high cost of building affordable new housing in the City, this project is feasible only through assistance, in part, from tax increment financing. At least 20% of the assisted housing units are intended to be both rent and income restricted, and affordable rental revenues alone are insufficient to make the project economically feasible without public assistance. The necessity of public assistance is true for most affordable housing developments in Minnesota. The developer has provided the City its estimated project proforma outlining project source and uses as well as projected rent, vacancy and financing assumptions. City staff and the City's advisors reviewed the information and have determined the project is not feasible without assistance due to anticipated rent levels and market returns not supporting the development costs for this site. 3. Finding that the TIF Plan for the 72nd and France Tax Increment Financing District conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission reviewed the TIF Plan and approved Resolution 2019-01 that affirms that the TIF Plan conforms to the general development plan of the City. Resolution 2019-24 Page 5 4. Finding that the Tax Increment Financing Plan for the 72nd and France Tax Increment Financing District will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development of the Southeast Edina Redevelopment Project Area by private enterprise. Through the implementation of the TIF Plan, the HRA and City will provide an impetus for residential development which is desirable and necessary for increased tax base of the State; the renovation of substandard property; addressing several of the goals and development principles identified within the City's Greater Southdale District Plan and other land use and development plans; meeting housing needs of people with a variety of incomes and provide new housing that would otherwise not be available. STATE OF MINNESOTA COUNTY OF HENNEPIN CITY OF EDINA ) ) ) SS CERTIFICATE OF CITY CLERK 1, the undersigned duly appointed and acting City Clerk for the City of Edina do hereby certify that the attached is a true and correct copy of the Resolution duly adopted by the Edina City Council at its regular meeting of March 19, 2019, and as recorded in the Minutes of said regular meeting. WITNESS, my hand and seal of said City this day of , 2019. City Clerk