5.1 Public Hearing TIF Plan 2-2 - Laserfiche WebLink

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CITY OF PEQUOT LAKES —TIF DISTRICT NO. 2 -2 TIF District attributable to each taxing jurisdiction. City Service Costs: Demands on other City services are expected to be handled without significant increases to public costs. City utilities are operated on a fee for service basis so usage revenues will cover increased costs. Impacts on police, fire, and administrative costs are expected to be negligible. The Authority anticipates assisting this project in this TIF district via the issuance of Pay as You Go Contract. This type of debt instrument does not apply to the City's or County's legal debt limit, nor does it cant' the City or County General Obligation pledge. As such, this TIF District will not have an adverse impact on the City's or County's current bond credit rating or capacity to borrow for future projects. The City may assist future projects via the issuance of pay as you go notes, which neither apply to the City's legal debt limit nor carry the City's General Obligation pledge. As such, this TIF District will not have an adverse impact on the City's current bond credit rating or capacity to borrow for future projects. TIF Attribution: The City projects TIF collections will total $802,487 over the 9 -year life of the TIF District. Of this total, $482,357 is attributable to the City's share of the tax levy; $231,765 from the County's share of tax levy, and approximately $76,761 from the School District's share of tax levy. Exhibit 4 has a detailed allocation of total TIF collections to the City, County and School. Section 10 Property to be acquired in the TIF District The City currently owns the parcels included in this TIF district. The City intends only to use tax increments for Pay As You Go basis to lower acquisition and site improvements costs for the developer in the TIF District. Section 11 Estimated Amount of Bonded Indebtedness The Authority reserves the right to fund all project costs permitted by law using internal funding, general obligation bonds, pay- as- you-go financing or any other financing mechanism authorized by law. The maximum amount of bonds to be funded with tax increment revenue from TIF District No. 2 -2 is $620,249. Internal Loans, including a negative balance in the TIF fund, must be authorized by resolution of the entity advancing the loan before money is transferred, advanced, or spent. The resolution must include the terms and conditions for repayment of the loan to include, at a minimum, the principal amount of the loan, the interest rate, and the maximum term. The interest rate to be charged on internal loans shall not exceed 5% based upon the limit of the greater of the rates specified under Minnesota Statutes 270C.40 or 549.09 as of the date this Plan is approved. Section 12 Designation of TIF District as an Economic Development District Economic development districts are a type of tax increment financing district which consists of any project which the Authority finds to be in the public interest because: 1. it will discourage commerce, industry, or manufacturing from moving their operations to another state or municipality; 2. it will result in increased employment in the state; or 3. It will result in preservation and enhancement of the tax base of the state. The TIF District qualifies as an economic development district in that the proposed development described in this TIF Plan (see Section 5) meets all of the criteria listed above. Without establishment of the TIF District the proposed development would not occur within the City. The proposed development will also result in increased employment and enhancement of the tax base of both the City and the State. Section 13 Original Net Tax Capacity The County Auditor will certify the Original Net Tax Capacity of the TIF District, which will be the total Net Tax Capacity of all property in the TIF District. For districts certified between January 1 and June 30, inclusive, this value is based on the previous assessment year. For districts certified between July 1 and December 31, inclusive, this value is based on the current assessment year. The Market Value of all property within the TIF District as of January 1, 2022, for taxes payable in 2023 is estimated at $12,350. Based on this information, the Original Net Tax Capacity of the TIF District would be 5