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Agenda Section: Consent <br /> Report Date: September 10, 2021 <br /> 71 NEW Council Meeting Date: September 14, 2021 <br /> MilBRIGHTON <br /> building tomorrow today <br /> REQUEST FOR COUNCIL CONSIDERATION <br /> ITEM DESCRIPTION: CONSIDER RESOLUTION AUTHORIZING AN INTERFUND LOAN FOR ADVANCE OF CERTAIN COSTS IN <br /> CONNECTION WITH ATAX INCREMENT FINANCING DISTRICT <br /> DEPARTMENT HEAD'S APPROVAL: Gina Foschi Gm- <br /> CITY MANAGER'S APPROVAL: <br /> No comments to supplement this report T Comments attached <br /> Recommendation: Approve the Resolution authorizing an interfund loan for advance of certain <br /> costs in connection with a tax increment financing district. <br /> Legislative History: The City is considering establishing Tax Increment Financing (Redevelopment) <br /> District No. 35 which is anticipated to include certain real property located at or near 2299 Palmer <br /> Drive in the City. Under Section 469.178, Subdivision 7 of the TIF Act, the City is authorized to <br /> advance or loan money from any fund from which such advances may be legally made in order to <br /> finance expenditures that are eligible to be paid with tax increments under the TIF Act. <br /> Explanation: The City will incur administrative costs associated with the establishment of the TIF <br /> District and certain other costs in connection with the proposed development. These other costs <br /> include, but are not limited to the acquisition of land and buildings, demolition and site preparation <br /> costs and the costs of public infrastructure. An interfund loan is needed from the Municipal <br /> Development Fund to help pay for the expenses listed above while the City waits for the tax <br /> increment revenue to be received from the TIF District. <br /> Costs and Funding: The interfund loan between the Municipal Development Fund and the TIF <br /> District is set to not exceed $10,565,713. The interfund loan will reflect an interest rate of 4% per <br /> annum (which is the greater of the rates specified under Sections 270C.40 or 549.09 in accordance <br /> with Minnesota Statutes Section 469.178, Subdivision 7) and will be compounded semiannually on <br /> February 1 and August 1 of each year and added to the principal. All payments will be applied first to <br /> accrued interest, and then to the unpaid principal balance. <br /> 4-4ex icY T <br /> Gina Foschi, Interim Finance Director <br /> Attachments: Resolution <br />