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East Elk River <br />November 30, 1998 <br />Page 3 <br /> <br />federal grants that have been obtained. Additionally, we have municipal <br />state aid funds which are eligible to be used on this street project, some TIF <br />money that can be used ff necessary, and some developer participation from <br />the Trott Brook Farms project is anticipated. <br /> <br />Based on the July 1997 feasibility study, the most underfunded improvement <br />in this project is the storm drainage component. There are limited funding <br />resources that can be used for this improvement and we are concerned about <br />depending heavily on the surface water management (SWM) tax levy. This <br />is because the SWM tax levy available for new debt is very limited, and also <br />there will be future SWM projects that are not'known at this time. <br />Accordingly, it is most appropriate to try to have TIF 19 finance as much of <br />the storm drainage improvements as possible. However, this is in conflict <br />with the goal of keeping the TIF 19 total years small. <br /> <br />Additional financial issues related to the overall project include a desire to <br />acquire the Brown property and the Kirkeide property and, ff this takes <br />place, then the city has to deal with financing the assessments associated <br />with the Brown property. Two other financial considerations that everyone <br />needs to keep in mind are the grant matching requirements placed upon the <br />city and the TIF penalty or participation requirement. At this time staff <br />believes there are viable options for the TIF penalty or participation and also <br />the grant matching requirement, but these are additional pieces of the puzzle <br />that need to be put into place, and with any puzzle, these pieces are <br />interrelated with the whole. <br /> <br />On Monday evening we will visit with the City Council about the options for <br />funding this project, the goal of keeping the TIF District as short as possible <br />while at the same time not depleting all of our other funding sources (i.e. <br />MSA funds, SWM funds, development funds), and the issue of meeting all of <br />our bonding debt and cash flow requirements. <br /> <br /> <br />