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• P. DURATION OF TAX INCREMENT FINANCING DISTRICTS Pursuant to Minnesota Statutes, Section 469.176, Subdivision 1(d), no tax increment shall be paid to the City or Authority three years from the date of certification of the ONTC by the County Auditor unless within the three-year period (1) bonds have been issued pursuant to Section 469.178, or in aid of a project pursuant to any other law, except revenue bonds issued pursuant to Chapter 469.152 to 469.165, prior to the effective date of the Act; or (2) the authority has acquired property within the district; or (3) the authority has constructed or caused to be constructed public improvements within the district. The City or Authority must therefore issue bonds, or acquire property, or construct or cause public improvements to be constructed in District No. 21 by approximately August 2000. Q. LIMITATION ON QUALIFICATION OF PROPERTY IN TAX INCREMENT DISTRICT NOT SUBJECT TO IMPROVEMENT Pursuant to Minnesota Statutes, Section 469.176, Subdivision 6, If, after four years from the date of certification of the original tax capacity of the tax increment financing district pursuant to Minnesota Statutes, Section 469.177, no demolition, rehabilitation or renovation of property or other site preparation, including qualified improvement of a street adjacent to a parcel but not installation of utility service including sewer or water systems, has been commenced on a parcel located within a tax increment financing district by the authority or by the owner of the parcel in accordance with the tax increment financing plan, no additional tax increment may be taken from that parcel and the original tax capacity of that parcel shall be III excluded from the original tax capacity of the tax increment financing district. If the authority or the owner of the parcel subsequently commences demolition, rehabilitation or renovation or other site preparation on that parcel including improvement of a street adjacent to that parcel, in accordance with the tax increment financing plan, the authority shall certify to the county auditor in the annual disclosure report that the activity has commenced. The county auditor shall certify the tax capacity thereof as most recently certified by the commissioner of revenue and add it to the original tax capacity of the tax increment financing district. The county auditor must enforce the provisions of this subdivision... For purposes of this subdivision, qualified improvements are limited to(1)construction or opening of a new street, (2)relocation of a street, and(3)substantial reconstruction or rebuilding of an existing street. R. LIMITATION ON THE USE OF TAX INCREMENT Pursuant to Minnesota Statutes, 469.1763, Subd. 2, at least 80 percent of the revenues derived from tax increments from an economic development district must be expended on activities in the district. These costs include demolition of structures, grading, site preparation, clearing of the land and installation of utilities, roads, sidewalks, and parking facilities for the site. The revenues shall be used to finance or otherwise pay public redevelopment and economic development costs allowed by law. These revenues shall not be used to circumvent any levy limit law. No revenues derived from tax increment shall be used for the construction or renovation of a municipally owned building used primarily and regularly for conducting the business of the municipality; this provision shall not prohibit the use of revenues derived from tax increments for the construction or renovation of a parking structure, a commons area used as a public park or a • facility used for social, recreational or conference purposes and not primarily for conducting the business of the municipality. Tax Increment Financing District No.21 Page 11-8