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HomeMy WebLinkAbout1990-03-26_SPECIAL MEETINGSAGENDA SPECIAL JOINT MEETING EDINA HOUSING AND REDEVELOPMENT AUTHORITY AND EDINA CITY COUNCIL _ MARCH 26, 1990 7:00 P.M. (Convene Joint HRA /Council Meeting) ROLLCALL I. PUBLIC HEARING - 1990 AMENDMENT TO 50TH AND FRANCE REDEVELOPMENT PLAN A. Resolution Approving 1990 Amendment to 50th &- 'France Redevelopment Plan and Requesting the Approval of the City Council (HRA) B. Resolution Approving 1990 Amendment to 50th & France Redevelopment Plan and Making Findings With Respect Thereto and Pledging Tax Increment to Certain Outstanding Bonds of the City (Council) II. ADJOURNMENT 1E >4��. �0 REPORT/RECOMMENDATION \Nn%R7'01V"t9 BB To: CITY COUNCIL AND HRA From: GORDON L. HUGHES ASSISTANT CITY MANAGER Date: MARCH 26, 1990 Subject: AMENDMENT TO 50TH & FRANCE REDEVELOPMENT PLAN Recommendation: Agenda Item # -I-- Consent ❑ Information Only ❑ Mgr. Recommends ❑ To HRA ❑ To Council Action ❑ Motion [� Resolution ~❑ Ordinance El Discussion Adopt attached Resolutions approving amendment to the 50th & France Redevelopment Plan. Info /Background: Attached is the proposed amendment to the 50th & France Redevelopment Plan. The effect of this proposed plan amendment is two -fold: 1. The amendment would allow the use of tax increments to finance the public improvement project at 50th & France which is estimated to cost $3,000,000. 2. The proposed amendment would allow the pooling of tax increments from the 50th & France Redevelopment District and the Southeast Edina Redevelopment District. This amendment would permit, but not obligate the City to use pooled increments from one district to the other. ' Notice of the March 26,.1990, public hearing was given to Hennepin County Board of Commissioners and the Board of Education for the Edina School District on February 23, 1990. They have also been provided with copies of the proposed amendment. r Commissioner introduced the following resolution and moved its adoption: RESOLUTION APPROVING 1990 AMENDMENT TO 50TH & FRANCE REDEVELOPMENT PLAN AND REQUESTING THE APPROVAL OF THE CITY COUNCIL BE IT RESOLVED, by The Housing and Redevelopment Authority of Edina, Minnesota (the "HRA"), as follows: I. Proposed Amendment. The HRA has approved a redevelopment plan, as defined in Minnesota Statutes, Section 469.002, subdivision 16, designated as the 50th & France Redevelopment Plan (the "Redevelopment Plan "), and a redevelopment project to be undertaken pursuant thereto, as defined in Minnesota Statutes, Section 469.002, subdivision 14 (the "Redevelopment Project "), and that in order to finance the public redevelopment costs to be incurred by the I-IRA in connection with the Redevelopment Plan and -the Redevelopment Project, the Redevelopment Plan established a tax increment financing district, as defined in Minnesota Statutes, Section 469.1' , subdivision 9 (the "District ") which is designated by Hennepin County as Tax Increment Financing District No. 1200. It has been proposed that the HRA approve an amendment to the Redevelopment Plan which is entitled "1990 Amendment to the 50th & France Redevelopment Plan" (the "1990 Amendment ") to authorize the expenditure of tax increment to finance additional public improvements in the area subject to the Redevelopment Plan, to expand the area subject to the Redevelopment Plan to include the area subject to the Southeast Edina Redevelopment Plan of the HRA (the "Southeast Edina Redevelopment Plan ") and to authorize the expenditure of tax increment revenue derived from the District to pay for public redevelopment costs incurred and to be incurred by the HRA and the City of Edina in connection with the Southeast Edina Redevelopment Plan and redevelopment projects undertaken pursuant thereto and to pay debt service on bonds issued and to be issued to finance such public redevelopment costs. 2. A1212roval of 1990 Amendment. The 1990 Amendment has been presented to this Board and is ordered placed on file in the office of the Executive Director of the HRA. The 1990 Amendment is hereby approved. As stated in the 1990 Amendment, the 1990 Amendment further serves the original goals and purposes of the City and HRA in approving the Redevelopment Plan and the. Southeast Edina Redevelopment Plan which is of benefit to all residents of the City. 3. Pledge Agreement, The officers of the HRA are authorized to enter into an agreement or agreements with the City to evidence the pledge of tax increments from the District to pay debt service on bonds or other obligations issued and to be issued by the City to finance public redevelopment costs of the Southeast Edina Redevelopment Plan. 4. Presentation to City Council. The 1990 Amendment hereby approved shall be presented to the City Council for a public hearing thereon pursuant to Minnesota Statutes, Section 4669.029, subdivision 6 and Section 469.175, subdivision 4. Dated the 26th day of March, 1990. Attest: Executive Director 2 Chairman Member introduced the following resolution and moved its adoption: RESOLUTION APPROVING 1990 AMENDMENT TO 50TH & FRANCE REDEVELOPMENT PLAN AND MAKING FINDINGS WITH RESPECT THERETO AND PLEDGING TAX INCREMENT TO CERTAIN OUTSTANDING BONDS OF THE CITY BE IT RESOLVED by the City Council of the City of Edina, Minnesota as follows: 1. The Commissioners of the Housing and Redevelopment Authority of Edina, Minnesota (the "HRA "), and the City of Edina, Minnesota (the "City "), have previously approved the Redevelopment Plan (the "Redevelopment Plail ") and a Redevelopment Project (the "Redevelopment Project") to be undertaken pursuant thereto, and in order to finance the- public redevelopment costs to be incurred by the City and the HRA in connection with the Redevelopment flan and the Redevelopment Project, the Redevelopment Plan established a tax increment financing district (the "District ") which is designated by Hennepin County as Tax Increment Financing District No. 1200. The Board of Commissioners of the HRA has approved an amendment to the Redevelopment Plan which is entitled "1990 Amendment to the 50th & France Redevelopment Plan" (the 1990 Amendment "). The 1990 amendment authorizes additional public improvements to be constructed in the area subject to the Redevelopment Plan, expands the area subject to the Redevelopment Plan to include the area subject to the Southeast Edina Redevelopment Plan of the HRA (the "Southeast Edina Redevelopment Plan ") and authorizes the expenditure of tax increment revenues derived front the District to pay the costs of such public improvements and to pay for public redevelopment' costs incurred and to be incurred by the 14RA and the City in connection with the Southeast Edina Redevelopment Plan and redevelopment projects undertaken pursuant thereto and to pledge tax increment revenue from the District to the payment of debt service on bonds heretofore and hereafter issued by the City to finance such costs. + 2. This Council on March 26, 1990, held a public hearing on the 1990 Amendment after notice of the public hearing was published in the official newspaper of the City not less than ten (10) days prior to the date of the hearing. At such public hearing all persons desiring to be heard with respect to the 1990 Amendment were given an opportunity to express their views with respect thereto. 3. The 1990 Amendment is hereby approved. The 1990 Amendment serves to meet the goals and objectives of the Redevelopment Plan and the Southeast Edina Redevelopment Plan. Pursuant to Minnesota Statutes, Section 469.175, subdivision 4, and for the reasons set forth in the Redevelopment Plan, as amended by the 1990 Amendment and the Southeast Edina Redevelopment Plan it is hereby found that: (A) The proposed development to be undertaken in accordance with the Redevelopment Plan, as amended by the 1990 Amendment and the Southeast Edina Redevelopment Plan, in the opinion of this Council would not occur solely through private investment within the reasonably foreseeable future and therefor the use of tax increment financing is deemed necessary. (B) The Redevelopment Plan, as amended by the 1990 Amendment, conforms to the general plan for the development of the City as a whole. (C) The Redevelopment Plan, as amended by the 1990 Amendment, will afford maximum opportunity Consistent with the sound needs of the City as a whole for the development of the area subject to the Redevelopment Plan and the Southeast Edina Redevelopment Plan. 4. Pledge of Tax Increment. The City has previously issued and there is presently outstanding the following bonds to finance public redevelopment costs incurred by the City and I-IRA pursuant to the Southeast Edina Redevelopment flan (the "Bonds "): Original Principal Title Dated Amount a. G.O. Tax Increment October 1, 1981 $ 4,500,000 Bonds, Series 1981 b. G.O. Tax Increment August 1, 1986 $ 4,000,000 Bonds, Series 1986A - C. G.O. Tax Increment October 1, 1988 $10,175,000 Bonds, Series 1988 d. G.O. Taxable Tax October 1, 1988 $ 5,100,000 Increment Bonds, Series 1988 2 e. G.O. Taxable Tax Increment Bonds, Series 1989 f. G.O. Tax Increment Bonds, Series 1989 g. G.O. Tax Increment Refunding Bonds, Series 1989 April 1, 1989 $ 5,300,000 April 1, 1989 $ 8,425,000 November 1, 1989 $12,970,000 The City hereby pledges to the Bonds tax increment revenue derived from the District received by the City from the HRA to pay the Bonds. The officers of the City are hereby authorized to enter into an agreement or agreements with the HRA to evidence such pledge of the tax increment revenue from the District to the payment of debt service on the Bonds. Passed by the Council this 26th day of March, 1990. Mayor Attest: City Clerk The motion for the adoption of the foregoing resolution was duly seconded by Member following voted in favor thereof: and upon vote being taken thereon, the and the following voted against the same. whereupon said resolution was declared duly passed and adopted, and was signed by the Mayor, whose signature was attested by the City Clerk. 3 i 1990 AMENDMENT TO THE _. 50TH & FRANCE REDEVELOPMENT PLAN of THE HOUSING AND REDEVELOPMENT AUTHORITY OF EDINA, MINNESOTA Table of Contents I. Introduction A. Recitals and St.at.ement. of Authority B. Definitions II. Description of Improvements III. Financing of Improvements IV. Statement of Need and Objectives V. Use of Tax_Increment for Payment of Public Redevelopment Costs of Southeast. Edina Redevelopment Plan- Vi. Estimate of Fiscal and Economic Impact of 1990 Amendment. A. Present. Status of District. B. If .Costs of Improvements and Public Redevelopment. Costs of the Southeast Edina Redevelopment. Plan Not Paid For With Tax Increment. C. If Costs of Improvements and Public Redevelopment. Costs of the Southeast. Edina Redevelopment. Plan Paid With Tax Increment. VII. Duration of District.; Captured Tax Capacity at Completion VIII. Additional Amendments to Plan IX. Original Plan I. INTRODUCTION A. Recitals and Statement. of Authority. The Commissioners of, the HRA and the City Council have previously approved the 50th & France Redevelopment. Plan, which established a tax _ ^crement financing district as defined in Minnesota Statutes, Section 469.174, subdivision 9, and has approved amendments to the Redevelopment Plan. It. has been proposed that (i) the HRA construct additional public improvements in the area subject to the Redevelopment. Plan and finance all or a portion of the cost of such public improvements with tax increments, (ii) additional property be included in the area subject to the Redevelopment. Plan, and (iii) public redevelopment costs incurred and to be incurred by the City and HRA in connection with the development and redevelopment of such additional property be paid from tax increments. This 1990 Amendment supplements and amends the 50t.h & France Redevelopment Plan to authorize the expenditure of tax increment revenues to finance such public improvements and to expand the area included in the Redevelopment. Plan and permit the expenditure of tax increment from the 50th and,France Redevelopment. Plan area with respect to improvements to such additional property included in the Redevelopment Plan. This 1990 Amendment does not enlarge the tax increment financing district established by the 50th & France Redevelopment Plan. This 1990 Amendment is established by action of the Commissioners of the HRA and the City Council of the City, pursuant to Minnesota Statutes, Sections 469.001 to 469.047, and Section 469.175, subdivision 4, and this 1990 Amendment is approved by such bodies pursuant. to Minnesota Statutes, Sections 469.001 to 469.047, and Section.469.175, subdivision 4. B. Definitions. Each of the words and terms defined in this Section shall for all purposes of this 1990 Amendment., have the meanings given to them in this Section: "Additional Property" means the area presently included in the Southeast. Edina Redevelopment. Plan, which is generally located in the extreme southeast corner of the corporate limits of the City. Minnesota." City" means the City of Edina, Hennepin County, "District. means the existing tax increment financing. district created by the Plan and designated by Hennepin County as number 1200. "HRA" means the Housing and Redevelopment Authority of Edina, Minnesota. W "Improvements" means the additional public improvements proposed to be undertaken in the Plan Area as described in Section II hereof. "1990 Amendment." means this 1990 Amendment to the 50th & France Redevelopment Plan. "Original Plan" means the 50th & France Redevelopment Plan, as heretofore amended and supplemented by the HRA and the City Council pursuant to law. "Plan" means the Original Plan as supplemented and amended by this 1990 Amendment and as further supplemented and amended from time to time by the HRA and City Council. the Plan. "Plan Area" means the area in the City subject. to "Southeast. Edina Redevelopment. Plan" means the Southeast. Edina Redevelopment. Plan, as heretofore amended and supplemented by the HRA and City Council. "Tax Increment "'means tax increment payable to the HRA from the District in accordance with Minnesota Statutes, Section 469.042. II. DESCRIPTION OF IMPROVEMENTS The Improvements include the following public improvements in the Plan Area: Sidewalk Renovation Additional Parking Facilities Street.scaping The t'ot'al cost of the Improvements (including administrative expenses of the City and HRA) is estimated to be $3,080,000. III. FINANCING OF IMPROVEMENTS The use of Tax Increment to pay the costs of the Improvements is hereby authorized. Such costs may be paid directly from Tax Increment, or may be paid indirectly from' Tax Increment, by the payment of debt service on bonds to be issued.by the City to finance such cost, or by the payment . of debt service on a loan or loans made by the City to the HRA to finance such cost. Any such bonds issued by the City or loan made by the City will be repaid, with interest, from the Tax Increment. It. is presently intended that the City will issue bonds pursuant to Minnesota Statutes, Section 469.178, subdivision 2, to finance the Improvements in the aggregate principal amount of approximately $3,080,000. -2- Other than the bonds, it is not expected that any obligations will be issued by the City or HRA to finance the costs of the Improvements. Any portion of the costs of the Improvements not paid from Tax Increment. will be paid from special assessments levied upon benefited properties. IV. STATEMENT OF NEED AND OBJECTIVES Because of a recent legislative change eliminating the capture of state paid homestead credit as tax increment, the tax increment to be derived from the tax increment financing districts established by the HRA and designated by Hennepin County as number 1201, 1203 and 1249, may not be sufficient to pay the public redevelopment costs incurred and to be incurred by the HRA and City in connection with the Southeast Edina Redevelopment Plan. The inclusion of the Additional Property in the area subject to the Plan will aid in the redevelopment of the Additional Property in accordance with the Southeast Edina Redevelopment Plan and in a manner beneficial to the residents of the City and consistent with-the objectives of the HRA as stated in the Southeast Edina Redevelopment Plan all of which will meet the needs specified in the Southeast Edina Redevelopment Plan. The Southeast Edina Redevelopment Plan and the tax increment financing plan for the tax increment financing districts designated by Hennepin County as number 1203 and 1249 are incorporated herein. by reference. V. USE OF TAX INCREMENT FOR PAYMENT OF PUBLIC REDEVELOPMENT COSTS OF SOUTHEAST EDINA REDEVELOPMENT PLAN The use of Tax Increment to pay for public redevelopment costs incurred and to be incurred by the HRA and City in connection with the Southeast Edina Redevelopment. Plan and redevelopment projects undertaken pursuant thereto is hereby authorized. The City has issued and there is presently outstanding the following bonds to finance such public redevelopment costs: a. b. c. d. Title G.O. Tax Increment. Bonds, Series 1981 G.O. Tax'Increment Bonds, Series 1986A G.O. Tax Increment. Bonds, Series 1988 G.O. Taxable Tax Increment Bonds, Series 1988 Dated October 1, 1981 August 1, 1986 October 1, 1988 October 1, 1988 -3- Original Principal Amount. $ 4,500,000 $ 4,000,000 $10,175,000 $ 5,100,000 e. G.O. Taxable April 1, 1989 $ 51300,000 Tax Increment. Bonds, Series 1989 G.O. Tax Increment Bonds, Series 1989 g. G.O. Tax Increment. Refunding Bonds, Series 1989 April 1, 1989 November 1, 1989 $ 8,425,000 $12,970,000 In addition, the City may issue additional tax increment bonds to finance public redevelopment costs to be incurred by the HRA and City in connection with the Southeast Edina Redevelopment Plan as described in the Southeast Edina Redevelopment Plan and the tax increment financing plan for the tax increment financing districts designated by Hennepin County as numbers 1203 and 1249. The HRA and City will pledge Tax Increment to the payment of the outstanding bonds issued above and may pledge such Tax Increment to the payment of the additional tax increment bonds. VI. ESTIMATE OF FISCAL AND ECONOMIC IMPACT OF 1990 AMENDMENT The estimate of the HRA of the fiscal and economic impact of the 1990 Amendment is as follows:, A. Present. Status of District. The adjusted original net tax capacity of the District. is $318,546. The current net tax capacity of the District for taxes payable in 1990 is $1,290,610. This results in a captured tax capacity of the District for taxes payable in 1990 of $972,064. Property within the District has a total tax capacity rate c�f approximately .94 for taxes payable in 1990. This tax capacity rate will produce Tax Increment in the amount of approximately $913,740 from taxes payable in 1990. B. •If Costs of Improvements and Public Redevelopment. Costs of the Southeast Edina Redevelopment. Plan Not Paid For With Tax Increment. If no cost of the Improvements or public redevelopment costs of the Southeast Edina Redevelopment. Plan (or bonds issued with respect thereto) is paid for with Tax Increment and no other additional expenditures of Tax Increment. are hereafter approved by the HRA, it. is estimated that using a 2% inflation rate, all presently outstanding bonds and loans payable from the Tax Increment. to be derived from the District will be paid in full (or funds will be on hand sufficient to pay such bonds or loans in full) by 1994. At such time the District will be terminated by the -4- f HRA and the captured tax capacity of the District will be available for taxation by the various taxing jurisdictions. C. If Costs of Improvements and Public Redevelopment of the Southeast Edina Redevelopment Plan Paid With Tax Increment. If all of the costs of the Improvements are paid from Tax Increment. and any excess Tax Increment not needed to pay the costs of the Improvements or the outstanding bonds and loans presently payable from the Tax Increment, is used to pay public redevelopment costs of the Southeast Edina - Redevelopment Plan (or bonds heretofore or hereafter issued with respect thereto) the District may stay in existence until August 1, 2009. Which results in the captured tax capacity of the District not being available for taxation by.t.he various taxing jurisdictions during the additional period the District stays in existence. VII. DURATION OF DISTRICT; CAPTURED TAX CAPACITY AT COMPLETION It is estimated that the-District will remain in existence until August 1, 2009 as permitted by Minnesota Statutes, Section 469.176, subdivision 1. The property in the District is fully developed, and it is not expected that significant additional private improvements will be constructed in the District during its remaining duration. Therefore, the present captured tax capacity represents the captured tax capacity at completion. VIII. ADDITIONAL AMENDMENTS TO PLAN The City and the HRA reserve the right to further amend or modify the Plan by their joint action, subject to the provisions of state law regulating such action. IX•. ORIGINAL PLAN The Original Plan except to the extent and provisions thereof are explicitly amended or supplemented by this 1990 Amendment shall remain in and be in full force and effect. I&V