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<br />11.4. All TIF assistance shall must be accompanied by a signed development agreement including
<br />a minimum assessment value. The developer must provide additional financing guarantees to ensure
<br />completion of the project, including, but not limited to: letters of credit, personal guarantees,
<br />corporate guarantees, etc.
<br />
<br />12.5. TIF District’s shall be limited to the minimum term necessary to meet the project needs.
<br />Only projects superseding exceeding the objectives identified in this policy will be considered to
<br />exceed the following general thresholds:
<br /> Redevelopment District 15 Years (Max is 265)
<br /> Housing District 15 Years (Max is 265)
<br /> Qualified Housing District 15 Years (Max is 25)
<br /> Soils Condition District 15 Years (Max is 210)
<br /> Renewal and Renovation District 10 Years (Max is 165)
<br /> Economic Development District 8 Years (Max is 98)
<br />
<br />13.6. Policy IssueConsiderations
<br /> Each project is required to meet the “but-for” test to determine the need for and level of
<br />assistance. This test and the amount of tax increment generated determines the district’s term.
<br />It is difficult to facilitate a redevelopment, housing or soils condition district for less than the
<br />maximum term as the extraordinary costs involved are usually significant.
<br /> Limiting theThe term of the district also limitscould coincide with the amount of tax increment
<br />the city has to spend on its priorities within a project area.
<br /> Of all the TIF districts, the Economic Development District is most often the one limited to a
<br />lesser term. Economic Development Districts are really “incentive” districts where it is not so
<br />much the extraordinary costs as it is an “incentive” to get a manufacturer business to locate in a
<br />community. In the other districts, the costs are easily identifiable and usually significant such as
<br />demolition, relocation, environmental remediation, and the cost differential between market rate
<br />and income/rent restricted housing.
<br />
<br />14.7. Developers receiving TIF assistance shall provide a minimum of twenty percent (1020%)
<br />cash equity investment in the project. TIF shall will not be used to supplant cash equity.
<br />
<br />15.8. TIF shall will not be used in circumstances where land and/or property price is in excess of
<br />fair market value. A third-party appraiser agreed upon by the city and developer will determine the
<br />fair market value of the land.
<br />
<br />16.9. The developer shall demonstrate a market demand for a proposed project. TIF shall not be
<br />used to support purely speculative projects.
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<br />17.10. The developer shall adequately demonstrate, to the city’s sole satisfaction, an ability to
<br />complete the proposed project based on past development experience, general reputation, and credit
<br />history, among other factors, including the size and scope of the proposed project.
<br />
<br />18.11. For the purposes of underwriting the proposal, the developer shall provide any requested
<br />market, financial, environmental, or other data requested by the city or its consultants.
<br />
<br />19.12. The city of Elk River shall only use TIF to encourage economic growth and development
<br />within the city limits. (See attached map)
<br />
<br />
<br />Application Process
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