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Pursuant to Minnesota law, tax increment generated by <br /> development within the TIF District may be captured <br /> by the City for a period of up to eight years . <br /> During this period other taxing jurisdictions will <br /> continue to receive taxes from the property within <br /> the TIF District based on the current net tax <br /> capacity. However, the current net tax capacity is <br /> $0. <br /> 2 . Estimated Impact of District No. 9 on the Taxing <br /> Jurisdictions Assuming None of the Captured Net Tax <br /> Capacity is Available to Taxing Jurisdictions Without <br /> Creation of District No. 9 : <br /> The Economic Development Authority of the City of Elk <br /> River has determined that the Tescom project would <br /> not reasonably be expected to occur without the <br /> creation of TIF District No. 9 and the use of tax <br /> increment financing. Therefore, none of the net tax <br /> capacity captured during the term of this TIF <br /> District would be available to other taxing <br /> jurisdictions without the creation of this district. <br /> 3 . Additional information on the impact of Tax Increment <br /> Financing District No. 9 on the other local taxing <br /> 111 jurisdictions can be found in Exhibit E. <br /> H. STUDIES AND ANALYSIS USED TO DETERMINE THE NEED FOR TAX <br /> INCREMENT FINANCING <br /> The Elk River EDA and City Council have determined that <br /> the Tescom Corporation, Inc. expansion project cannot <br /> reasonably be expected to occur solely through private <br /> investment within the reasonably foreseeable future. <br /> Therefore, the use of Tax Increment Financing assistance <br /> is deemed necessary. <br /> This determination has been made based on the following: <br /> - The Company was purchased, through a Leveraged <br /> Buy-Out (LBO) , in December, 1986 . While Tescom <br /> Corporation, Inc. is still highly leveraged, it has <br /> proven the ability to service its debt as illustrated <br /> by the significant reduction over the five and one <br /> half years since the LBO. Tax Increment assistance <br /> is needed to reduce overall project costs to ensure <br /> Tescom remains a financially stable and profitable <br /> company after its expansion. <br /> - Tescom Corporation, Inc. owns and operates a second <br /> facility in Watertown, South Dakota. The Company is <br /> currently reviewing its options for appropriate <br /> locations for expansion. While Elk River offers some <br />