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5. QUALIFICATION REQUIREMENTS <br /> • The properties were inspected and evaluated to determine whether the qualification tests <br /> for tax increment eligibility for a redevelopment district,required under the following <br /> Minnesota Statutes, could be met. <br /> Minnesota Statute Section 469.174, Subdivision 10, clause(a) (1)requires two tests for <br /> occupied parcels: <br /> A. Coverage Test—"parcels consisting of 70 percent of the area of the district <br /> are occupied by buildings, streets, utilities, or paved or gravel parking lots" <br /> The coverage required by the parcel to be considered occupied is defined <br /> under Minnesota Statute Section 469.174, Subdivision 10, clause(e) which <br /> states: "For purposes of this subdivision, a parcel is not occupied by buildings, <br /> streets,utilities, or paved or gravel parking lots unless 15 percent of the area <br /> of the parcel contains building, streets,utilities, or paved or gravel parking <br /> lots." <br /> B. Condition of Buildings Test—"and more than 50 percent of the buildings, <br /> not including outbuildings, are structurally substandard to a degree requiring <br /> substantial renovation or clearance;" <br /> Structurally substandard is defined under Minnesota Statute Section 469.174, <br /> Subdivision 10, clause(b)which states: "For purposes of this subdivision, <br /> • `structurally substandard' shall mean containing defects in structural elements <br /> or a combination of deficiencies in essential utilities and facilities, light and <br /> ventilation, fire protection including adequate egress, layout and condition of <br /> interior partitions,or similar factors, which defects or deficiencies are of <br /> sufficient total significance to justify substantial renovation or clearance." <br /> Substantially substandard is further defined in the statute under Subdivision <br /> 10, clause(c)which states: <br /> "A building is not structurally substandard if it is in compliance with the <br /> building code applicable to new buildings or could be modified to satisfy the <br /> building code at a cost of less than 15 percent of the cost of constructing a <br /> new structure of the same square footage and type on the site. The <br /> municipality may find that a building is not disqualified as structurally <br /> substandard under the preceding sentence on the basis of reasonably available <br /> evidence, such as the size, type, and age of the building, the average cost of <br /> plumbing, electrical, or structural repairs, or other similar reliable evidence." <br /> "Items of evidence that support such a conclusion [that the building is <br /> structurally substandard] include recent fire or police inspections, on-site <br /> property appraisals or housing inspections, exterior evidence of deterioration, <br /> or other similar reliable evidence." <br /> Page 4 <br />