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June 10, 2002 <br /> <br />TO: <br /> <br />Re: <br />For: <br /> <br />Pat Klaers <br />City Administrator <br />City of Elk River <br />13065 Orono Parkway <br />Elk River, MN 55330 <br /> <br />Property Tax Abatement <br />Proposed Elk Path Professional Office Building <br /> <br />Dear Pat: <br /> <br />This will confirm our conversation of last Friday regarding our concem with the proposed <br />use of tax subsidies for speculative office development of Elk Path LLC. <br /> <br />We believe the application should be denied by the Elk River City Council for one or all <br />of the following reasons. <br /> <br />Note: Hereinafter the Economic Development Tax Rebate Financing Policy & <br />Application shall be referred to as "Rebate Policy". <br /> <br />1) The application does not meet any one of the Objectives set forth in the <br />Rebate Policy under Section III Objectives of Tax Rebate Financing; as such this <br />project would not qualify subject to Section VI thereof. <br /> <br />2) We do not believe it was the intent of the Rebate Policy to subsidize <br />SPECULATIVE OFFICE DEVELOPMENT. This proposal is definitely pure <br />speculation. <br /> <br />3) Under the Business Subsidy Law Minnesota Chapter 116J.993-995, <br />116J.994 Subd. 4 Wage & Job Goals it states in part "The subsidy agreement, in <br />addition to any other goals, must include (1) goals for the number of jobs created". <br /> <br />We believe if this abatement were approved, the proposed Abatement Agreement <br />(Page 3, Para. H) should stipulate that the covenant to provide 100 additional <br />NEW full time jobs in the City of Elk River will not be changed or modified in any <br />way during the abatement period. <br /> <br />4) Job Creation. The problem has always been to determine how a <br />Speculative Office Building can in itself create jobs other than such as lawn care, <br />etc. The point being is that Speculative Office Space is in no way similar to an <br />office building that would be proposed in order to move a large number of <br /> <br /> <br />