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I. POLICY PURPOSE <br />For the purposes o£ this document, the term "City" shall include the Elk River City <br />Council, Economic Development Authority, and Housing and Redevelopment Authority. <br /> <br />The purpose of this policy is to establish the City of Elk River's position <br />relating to the use of Tax Rebate Financing (TRF), otherwise referred to <br />as Tax Abatement, for private development above and beyond the <br />requirements and limitations set forth by State Law. This policy shall be <br />used as a guide in the processing and review of applications requesting <br />tax rebate assistance. The fundamental purpose of tax rebate financing in <br />Elk River is to encourage desirable development or redevelopment that <br />would not otherwise occur but for the assistance provided through TRF. <br /> <br />The City of Elk River is granted the power to utilize TRF by the <br />Minnesota Tax Abatement Act, as amended. It is the intent of the City to <br />provide the minimum amount of TRF, as well as other incentives, at the <br />shortest term required for the project to proceed. The City reserves the <br />right to approve or reject projects on a case by case basis, taking into <br />consideration established policies, project criteria, and demand on city <br />services in relation to the potential benefits from the project. Meeting <br />policy criteria does not guarantee the award of TRF to the project. <br />Approval or denial of one project is not intended to set precedent for <br />approval or denial of another project. <br /> <br />II. DIFFERENCE BETWEEN TRF & TIF <br />The primary difference between Tax Rebate Financing (TRF) and Tax <br />Increment Financing (TIF) is the way in which the dollars are awarded to <br />the project. When TIF is awarded to a project by the city, the other <br />political subdivisions (the school district and the county) are required to <br />contribute their portion of the increased taxes to the project. Conversely, <br />when TRF is requested, each political subdivision has the option of <br />granting its portion of the increased taxes to the project. Subsequently, <br />the dollars generated for the project with TRF are generally less than the <br />dollars generated with TIF. <br /> <br />III. OBJECTIVES OF TAX REBATE FINANCING <br />As a matter of adopted policy, the City will consider using TRF to assist <br />private development projects to achieve one or more of the following <br />objectives: <br /> · To retain local jobs and/or increase the number and diversity of <br /> jobs that offer stable employment and/or attractive wages and <br /> benefits. <br /> <br />· To enhance and diversify the city of Elk River's economic base. <br /> <br />· To encourage additional unsubsidized private development in the <br /> area, either directly or indirectly through "spin off' development. <br /> <br />3 <br /> <br /> <br />