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Tourism Facility Economic Development Districts: The term "tourism facility" was substantially restricted for districts
<br />created after May 31, 1993. Now, such a facility means property that: (1) is located in a county where the median income
<br />is no more than 85 percent of the state median income; (2)is located in a county in development region 2, 3, 4, or 5, as defined
<br />in section 462.385; (3) is not located in a city with a population in excess of 20,000; (4) is acquired, constructed, or
<br />rehabilitated for use as a convention and meeting facility that is privately owned, marina, hotel, motel, lodging facility, or
<br />nonhomestead dwelling unit that in each case is intended to serve primarily individuals from outside the county.
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<br />Tourism counties include Aitkin, Becker, Beltrami, Carlton, Cass, Clay, Clearwater, Cook, Crow Wing, Douglas, Grant,
<br />Hubbard, Itasca, Koochiching, Lake, Lake of the Woods, Mahnomen, Morrison, Otter Tail, Pope, St. Louis, Stevens, Todd,
<br />Traverse, Wadena, and Wilkin.
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<br />Bedrock Soils Economic Development Districts: The 1995 legislature added language that allows revenue derived from tax
<br />increment from an economic development district to be used for site preparation and public improvements for any type of
<br />development if bedrock soils are present in 80 percent or more of the acreage of the district, the estimated costs of physical
<br />preparation of the site exceeds the fair market value of the land before completion of the preparation, and revenue derived
<br />from tax increments are expended only for the additional costs of preparing the site and installing public improvements
<br />because of unstable soils and the bedrock soils condition. The 1995 legislature also removed a previous exception that
<br />allowed use of tax increment to finance up to 5,000 square feet of commercial or retail facilities in cities of 5,000 people or
<br />less.
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<br />Small Cities Economic Development Districts:. The 1997 legislature added language that permits revenues derived from tax
<br />increment from an economic development district to assist small city commercial facilities up to 15,000 square feet, within
<br />certain guidelines. The facilities must be separately owned and the city must have a population of 5,000 or less and must be
<br />located more than 10 miles from a city with a population of 10,000 or more.
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<br />Soils Condition Districts
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<br />Qualifications:
<br /> 1. the presence of hazardous substances, pollution, or contaminants requires removal or remedial action for use;
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<br />2. the estimated cost of the proposed removal and remedial action exceeds the fair market value of the land before
<br /> completion of the preparation.
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<br />The requirements of clause (b) need not be satisfied if each parcel either satisfied the requirements of that clause, or the
<br />estimated costs of the proposed removal or remedial action exceeds $2.00 per square foot for the area of the parcel.
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<br />Term and Restrictions. May collect increment for 12 years after the date of approval of the TIF Plan; increment may be spent
<br />only to: acquire parcels on which removal or remediation will occur; pay the cost of removal or remedial action, and pay
<br />allocated administrative expenses, including the cost of preparation of the development action response plan.
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<br />Soils districts could be created before June 30, 1995 based on unusual terrain and soils conditions. The 1995 amendments
<br />essentially changed a soils condition district to a hazardous waste district.
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<br />Hazardous Substance Subdistricts
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<br />Qualifications. Consists of parcels within a TIF District of any kind that are "designated hazardous substance sites" or are
<br />contiguous parcels that the authority expects to be developed together with the hazardous substance site.
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<br />"Designated hazardous substance sites" are parcels for which there is a state-approved "development action response plan,"
<br />and the authority has entered into an agreement providing for removal actions or otherwise certified that it will finance such
<br />removal.
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<br />Term and restrictions. May collect increment from the subdistrict for up to twenty-five years after the date of receipt of the
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<br /> Ehlers & Associates - TIF Basics 4
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