HomeMy WebLinkAboutResolution No. 2024-78 Establishing 72nd & France TIFCITY OF EDINA
COUNTY OF HENNEPIN
STATE OF MINNESOTA
Councilmember - i
1-
introduced the following resolution and moved its adoption:
RESOLUTION 2024-78
ESTABLISHING THE 72" AND FRANCE #3 TAX INCREMENT FINANCING DISTRICT
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 therefore. 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 a Tax Increment Financing Plan (the "TIF Plan") for the establishment of the 72nd and France #3
Tax Increment Financing District (the "TIF District") therein (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") 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 TIF District and the adoption and approval of the proposed Plans, including, but not limited
to, notification of Hennepin County and Independent School District No. 280 having taxing jurisdiction over the
property within the TIF District, a review of and written comment on the Plans by the City Planning Commission,
approval of the Plans by the HRA on November 14, 2024, 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 2024-78
Page 2
1.05. The City is not modifying the boundaries of the Project Area, but is, however, modifying the
Redevelopment Plan to include activities related to the TIF District.
Section 2. Findings for the Adoption and Approval of the Redevelopment Plan Modification.
2.01. 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 Area 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 TIF District.
3.01. The Council hereby finds that the TIF District is in the public interest and is a "redevelopment district"
under Minnesota Statutes, Section 469.174, Subd. 10 of the Act.
3.02. The Council further finds that the proposed redevelopment would not 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 the TIF District permitted by the TIF Plan.
3.03. The Council finds 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 TIF District by private enterprise.
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.
3.05. The HRA elects to calculate fiscal disparities for the TIF District in accordance with Minnesota Statutes,
Section 469.177, Subd. 3, clause b, which means the fiscal disparities contribution would be taken from inside the
TIF 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 an area of the City which is already built up, to provide employment 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.
James B. Hovland, Mayor
Resolution 2024-78
Page 3
5.01. 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 TIF 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 TIF District, for which building permits have been issued during the 18 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 469.175, Subd. 4a.
TSI notion for the adoption of the foregoing resolution was duly seconded by Council member
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and the following voted again the same: -- S
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, and upon a vote eing taken erepn, t he following voted in favor thereof:
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Dated: November 19, 2024
Attest:
Sharon Allison, ity Clerk
(Seal)
Resolution 2024-78
Page 4
EXHIBIT A
RESOLUTION NO. 2024-78
The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for the 72nd
and France #3 Tax Increment Financing District, as required pursuant to Minnesota Statutes, Section 469.175,
Subdivision 3 are as follows:
I Finding that the 72nd and France #3 Tax Increment Financing District is a redevelopment district as defined in
M.S., Section 469.174, Subdivision 10.
The District consists of one (I) parcel within the Southeast Edina Redevelopment Project Area and its internal
and external rights-of-way, abutting roadways and intersections, pedestrian pathways and crossings; with plans
for demolition and clearance of a single-use commercial building for redevelopment of underutilized property
at 7235 France Avenue South. The parcel, consisting of at least 70 percent of the area of the District, is
occupied by buildings, streets, utilities, paved or gravel parking lots or other similar structures, and more than
50% of the buildings in the District are structurally substandard to a degree requiring substantial renovation
or clearance. (See Appendix D of the TIF Plan.)
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 the District permitted by the TIF
Plan.
The proposed development, in the opinion of the City, 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 activities proposed in the TIF Plan meets the City's objectives for
redevelopment. The existing property contains a substandard building whose renovation requires added costs
related to demolition, remediation, site improvement and construction of infrastructure. The redevelopment
also requires substantial investment toward public improvements such as local transportation and utility
infrastructure, pedestrian connections and parking. Because of the public and private cost of financing the
proposed improvements which are essential to the comprehensive redevelopment of the area, this project is
feasible only through assistance, in part, from tax increment financing.
The Developers provided a proforma for each building outlining project sources and uses as well as projected
rent, vacancy and financing assumptions. City staff and the City's financial advisor reviewed the information
and have determined that the projects are not feasible without assistance due to anticipated rent levels and
market returns not supporting the redevelopment costs for this site. The Developers have indicated that the
private investment necessary could not go forward without public assistance.
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 market value estimated to result from the proposed development after
Resolution 2024-78
Page 5
subtracting the present value of the projected tax increments for the maximum duration of the District permitted by
the TIF Plan:
This finding is justified on the grounds that the development intensity and tax base created on currently
underutilized and declining property requires site and public improvement costs that are improbable without
public assistance. Specifically, the cost of site preparation, demolition, remediation, and public improvements
to include transportation and utility infrastructure will add significantly to the total redevelopment cost of any
development in this area. Site and public improvements costs necessary to sustain the approved density have
made redevelopment infeasible without tax increment assistance. The City reasonably determines that no
other redevelopment of similar scope is anticipated on this site without substantially similar assistance being
provided to the development.
Therefore, the City concludes as follows:
a. If the proposed development occurs, the total estimated increase in taxable market value will be
$230,543,363.
b. The present value of tax increments from the District for the maximum duration of the district
permitted by the TIF Plan is estimated to be $33,313,587.
c. Even if some development other than the proposed development were to occur, the Council finds that
no alternative would occur that would produce a taxable market value increase greater than $197,229,776
(the amount in clause a less the amount in clause b) without tax increment assistance.
3. Finding that the TIF Plan for the 72nd and France #3 Tax Increment Financing District conforms to the general
plan for the development or redevelopment of the municipality as a whole.
The Housing and Redevelopment Authority requested a written opinion from the City of Edina Planning
Commission whether the proposed redevelopment identified in the TIF Plan conforms to the general
development plan of the City as a whole. The Planning Commission reviewed the request at its September
25th meeting but did not provide a written opinion.
The City Council re-affirms the findings adopted September 17, 2024 within Resolution 2024-60 approving
the final re-zoning and overall development plan for the redevelopment property. Resolution 2024-60 finds
that the proposed land uses and density are consistent with the City's Comprehensive Plan and PUD #25
Zoning on the site.
4. Finding that the Tax Increment Financing Plan for the 72' and France #3 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 City will provide an impetus for the construction of a new
mixed-use private development which will result in increased employment in the City and the State of
Minnesota, the renovation of substandard properties, new affordable housing options within the City,
increased tax base of the State and add a high-quality development to the City.
, 2024.
Resolution 2024-78
Page 6
STATE OF MINNESOTA )
COUNTY OF HENNEPIN) SS
CITY OF EDINA )
CERTIFICATE OF CITY CLERK
I, 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
November 19, 2024, and as recorded in the Minutes of said regular meeting.
WITNESS, my hand and seal of said City this I ctilly of
Sharon Allison, City Clerk