7.1. SR 07-03-2017 - Laserfiche WebLink

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City of Elk River, Minnesota SPRINGSTED Page 6 The proposed project consists of the redevelopment of property within the City that consists of blighted properties that were found to be substandard and will be demolished following establishment of the district. The City has identified significant and extraordinary costs including public improvements, acquisition and demolition associated with redevelopment of the project site in conjunction with new development. The estimated total redevelopment costs for this property make the total cost of this effort significantly higher than costs reasonably incurred for similar developments on a clean site. The City’s finding that the proposed redevelopment would be unlikely to occur solely through private investment within the reasonably foreseeable future is based on an analysis of the proforma and other materials submitted by the developer. As necessary, the City anticipates analyzing future developer’s proformas in detail to determine the minimal amount of assistance needed to compensate developers for extraordinary and allowable costs. No higher market value expected: If the proposed redevelopment did not go forward, for the same reasons described above, no significant alternative redevelopment of the proposed TIF area would occur. The existing buildings are currently substandard and it is highly unlikely that the improvements would be made on the property site without tax increment financing. In short, there is no basis for expectation that the area would redevelop or be renovated in any significant way purely by private action without public subsidy. To summarize the basis for the City’s findings regarding alternative market value, in accordance with Minnesota Statutes, Section 469.175, Subd. 3(d), the City makes the following determinations: a. The City's estimate of the amount by which the market value of the site will increase without the use of tax increment financing is anywhere from $0 to some modest amount based on small scale renovation or redevelopment that could be possible without assistance; any estimated values would be too speculative to ascertain. b. If the proposed development to be assisted with tax increment occurs in the District, the total increase in market value would be approximately $2,829,727, including the value of the building (See Exhibit V). c. The present value of tax increments from the District for the maximum duration of the district permitted by the TIF Plan is estimated to be $731,388 (See Exhibit V). d. Even if some development other than the proposed development were to occur, the Council finds that no alternative would occur that would produce a market value increase greater than $2,098,339 (the amount in clause b less the amount in clause c) without tax increment assistance. (3) The TIF Plan will afford maximum opportunity, consistent with the sound needs of the City as a whole, for development of the Project Area by private enterprise. Factual basis: The anticipated redevelopment of the project site and any subsequent demolition, reconstruction, or renovation related to the project will remain consistent with the City’s design goals. (4) The TIF Plan conforms to general plans for development of the City as a whole. Factual basis: The City Planning Commission has determined that the development proposed in the TIF Plan conforms to the City comprehensive plan.