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• The development agreement spells out the terms and conditions by which the <br />developer will be reimbursed the TIF principal equal to the lesser of the <br />project costs or 15 percent of the assessed market value of the project as of <br />January 2, 1997. Because this is structured as a pay -as- you -go economic <br />development project, 1998 is the first year the developer will obtain TIF <br />reimbursements. Reimbursements to the developer will continue until the <br />lesser of the project costs or 15 percent of the assessed market value have <br />been paid. Thereafter, TIF District No. 12 will be decertified. <br />An exhibit of the development agreement relates to the Tax Increment <br />Revenue Note, whereby the City of Elk River acknowledges that it is <br />indebted to, and promises to pay, the developer of the precision machining <br />facility. <br />On December 11, the Elk River EDA authorized its president and executive <br />director to sign the agreement. Therefore, it is appropriate for the city to also <br />execute this agreement. <br />Action Requested <br />• The City Council is asked to: <br />1. Adopt a resolution modifying and expanding upon Resolution 95 -32; <br />2. Authorize the mayor and city administrator to execute the <br />development agreement; and, <br />3. Authorize a Tax Increment Revenue Note, dated December 18, 1995. <br />is <br />