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<br />N:\Departments\Community Development\Economic Development\EDA\Administrative\Agenda\Joint Finance Committee Agenda <br />Packets\2020\09162020 Special Meeting\4.1 sr Shoot Steel TIF Application Review.docx <br />The developer’s proposed financial package for the Shoot Steel project includes long-term, private <br />financing of $1,259,050 from Village Bank, $1,036,000 in SBA financing, $200,000 from a private investor <br />and $98,258 in equity from the owner, for a total estimated project budget of $2,993,308. <br /> <br />Policy Review <br />Staff completed a review of the application in accordance of the city’s Tax Increment Financing Policy <br />adopted on December 4, 2017. <br /> <br />Based on the Estimated Market Value of the project as calculated by Sherburne County, the project’s <br />EMV is approximately $1,349,100 or $67 per square foot. <br /> <br />Public Purpose <br />The project must achieve one or more of the following public purpose statements: <br />1. Demonstrate long-term benefits to the community. <br />2. Retain local jobs and/or increase the number and diversity of jobs that offer stable <br />employment and/or attractive wages and benefits through: <br /> Diversification of the local economy <br /> Significant addition of permanent, high-wage, full-time jobs <br /> Addition of jobs attractive to those unemployed or underemployed <br />3. Significantly increases the city’s commercial and industrial tax base. <br />4. Demonstrates the ability to encourage unsubsidized private development through “spin <br />off” development. <br />5. Facilitates the development process and achieves development on sites that would not <br />develop “but for” the use of TIF. <br />6. Removes blight and/or encourages redevelopment of commercial and industrial areas <br />resulting in high quality redevelopment and private reinvestment. <br />7. Offsets redevelopment costs (i.e. contaminated site cleanup) over and above the costs <br />normally incurred in development. <br />8. Aids the implementation of the Mississippi Connections Plan. <br /> <br />The proposed project meets public purpose objective #1, #2, and #3. <br /> <br />TIF District Term <br />According to the city’s policy adopted by Council on December 14, 2017, TIF Districts shall be limited to <br />the minimum term necessary to meet the project needs. Only projects exceeding the objectives identified <br />in the policy will be considered to exceed the maximum term allowed. The maximum term allowed for an <br />economic development district is 8 years after receipt of the first increment, for a total of 9 years. <br /> <br />The applicant has requested the maximum term allowed for an economic development district. <br /> <br />Policy Considerations <br />1. Each Project is required to meet the but for test to determine the need for and level of assistance. <br /> Baker Tilly completed a but for analysis and determined without TIF assistance the project <br />would not proceed. <br />2. Developers receiving TIF assistance shall provide a minimum of ten percent cash equity <br />investment in the project. TIF is not to be used to supplement cash equity.