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City Council Minutes February 5, 2018 Page 7 of 26 years. She further noted the term can be longer for rural communities due to construction costs and needing to close the gap. Councilmember Ovall asked what the average term is for other communities considering establishing a housing district. He also asked Ms. Hour about pooling increment as there is confusion if it both projects need to be TIF eligible for pooling. Ms. Huot stated she has seen Housing District terms anywhere from 15 to 25 years depending on the individual housing needs of each community. Ms. Hoot stated pooling is defined as the spending of tax increment dollars from a specific tax increment district within a defined project area. She stated it is the taking of tax increment dollars from a particular TIF district and spending them on qualifying uses outside the boundaries of that district. She discussed how the districts can be different along with the percentage of dollars pooled. She stated housing districts have the most flexibility meaning a city can spend the dollars anywhere in the city as long as they are on a qualifying project. Councilmember Ovall stated this is an important distinction and that a project receiving pooled increment does not have to be a qualifying TIF district as long as the project has an affordable housing component to it. He questioned if this is a TIF -eligible project because it does create an increment, but based on Ms. Huot's comments, it seems to be geared more towards affordable housing and percentage. Ms. Huot stated, based on the two current project criteria, it would not make any sense to create a district for the Lodge project because it doesn't generate any increment. She stated the only way for this project to receive any increment would be from some other funding source. Councilmember Ovall affirmed the Lodge could qualify for pooling under the statutory uses. Ms. Hoot stated as long as there are capital expenditures and it meets the affordability criteria. Councilmember Ovall stated the base issue to consider is whether the Council wants to veer from the 15 years outlined in city policy. He noted the intent from the applicant is to pool the projects in order to use the increment for capital improvements at the Lodge, which there is capital improvements and it would meet the affordable housing guidelines. Mayor Dietz questioned if the city is requiring the applicant to make the Lodge into an apartment building. Ms. Othoudt stated he is doing it by choice because he is required to do the repairs per city ordinance, noting it is currently an illegal non -conforming use. 10/EAEI B1 NATURE