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<br />capacity rates vary by certain categories of property; for example, the tax capacity rates for <br />residential homesteads are currently less than the tax capacity rates for commercial and <br />industrial property. In 2001 the Minnesota Legislature enacted property tax reform that <br />lowered various tax capacity rates to “compress” the difference between the tax capacity <br />rates applicable to residential homestead properties and commercial and industrial <br />properties. <br />8. Changes to Local Tax Rate. The local tax rate to be applied in the tax <br />increment financing district is the lower of the current local tax rate or the original local <br />tax rate for the tax increment financing district. In the event that the Current Local Tax <br />Rate is higher than the Original Local Tax Rate, then the “excess” or difference that comes <br />about after applying the lower Original Local Tax Rate instead of the Current Local Tax <br />Rate is considered “excess” tax increment and is distributed by Sherburne County to the <br />other taxing jurisdictions and such amount is not available to the City as tax increment. <br />9. Legislation. The Minnesota Legislature has frequently modified laws <br />affecting real property taxes, particularly as they relate to tax capacity rates and the overall <br />level of taxes as affected by state aid to municipalities. <br />10. Multi-Owner District. In determining the amount of tax increment <br />generated by the development property, Sherburne County may allocate a sharing factor <br />when there are multiple parcels of land in the tax increment financing district. This may <br />result in a lower amount of tax increment attributable to the development property than if <br />the development property was the only parcel in the district. In addition, the sharing factor <br />calculation is not consistent with the method that the City will use to determine Pledged <br />Tax Increments. <br />F. The Note Holder acknowledges that the Note was issued as part of an TIF <br />Assistance Agreement between the City and the Developer dated__________, 2021 (“TIF <br />Assistance Agreement”), and that the City has the right to suspend payments under this Note and/or <br />terminate the Note upon an Event of Default under the TIF Assistance Agreement. <br />G. The Note Holder acknowledges that the City makes no representation about the tax <br />treatment of, or tax consequences from, the Note Holder’s acquisition of \[the Note\]/\[an interest in <br />the Note as collateral for the Loan\]. <br />WITNESS our hand this ___ day of _______, 20__. <br />Note Holder: <br />_________________________ <br />By ________________________ <br /> Name: __________________ <br />Its ________________________ <br />D-10 <br />EL185-50-718703.v2 <br /> <br />