Economic Development Authority

AGENDA ECONOMIC DEVELOPMENT AUTHORITY APRIL 6, 2020 1. CALL TO ORDER 2. APPROVAL OF MINUTES A. December 16, 2019 Motion by seconded by to approve, table or deny approving the minutes of the December 16, 2019 Economic Development Authority Meeting. 3. EDA RESOLUTION NO. 18 A. ProMed Redevelopment Project Area and TIF Plan Approval Motion by seconded by to approve, table or deny adopting Resolution No. 18 approving the modification of the Redevelopment Plan for Redevelopment Project Area No. 1, Approving the creation of the ProMed Tax Increment Financing District and approving the adoption of a Tax Increment Financing Plan therefor. 4. ADJOURNMENT Motion by seconded by to adjourn. Meeting adjourned at  EDA 2A AGENDA ITEM Maple Grove Economic Development Authority DRAFT Meeting Minutes December 16, 2019 DRAFT Delete this when final edits are complete) Call to Order Pursuant to call and notice thereof, an Economic Development Authority Meeting of the Maple Grove City Council was held at 7: 30 p. m. on December 16, 2019 at the Maple Grove Government Center/ Public Safety Facility, Hennepin County, Minnesota. Members present were President Mark Steffenson, Vice President Karen Jaeger, Secretary Heidi Nelson, Treasurer Judy Hanson, and Commissioners Phil Leith and Kristy Barnett. Absent was none. Present also were Joe Hogeboom, Community and Economic Development Director; Peter Vickerman, Planning Manager; Ken Ashfeld, Director of Public Works/City Engineer; and Justin Templin, City Attorney. President Steffenson called the meeting to order at 8: 10 p.m. Approval of Motion by Vice President Jaeger, seconded by Commissioner Barnett, to approve the September 16, 2019 September 16, Economic Development Authority meeting minutes. Upon 2019 Minutes call of the motion by President Steffenson, there were five ayes and no nays. Motion carried. Adopt 2020 Finance Director Hauer requested the EDA consider approving EDA/HRA the 2020 budget and tax levy. He reviewed the proposed budget Budget and and tax levy in further detail noting the main source of EDA revenues was from scattered site housing rents. He noted the Tax Levy budget includes $ 150, 000 tax levy, which was the same as 2019. He commented on the expenditures the EDA would have in EDA 2020 and reported Great Lakes Management would continue to Resolution No. manage the city' s scattered site housing. 17 Vice President Jaeger questioned if the EDA should be DRAFT Maple Grove EDA Minutes December 16, 2019 Page 2 increasing its levy to keep in line with the rising expenses to maintain the scattered site housing. Finance Director Hauer reported the rents collected would offset the expenses and there was no need to increase the EDA levy. Motion by Vice President Jaeger, seconded by Commissioner Barnett, to approve adopting EDA Resolution No. 17 adopting for 2020 the EDA Budget and setting a tax levy for 2020. Upon call of the motion by President Steffenson, there were five ayes and no nays. Motion carried. Adjournment Motion by Vice President Jaeger, by seconded Commissioner Barnett, to adjourn to the City Council meeting. Upon call of the motion by President Steffenson, there were five ayes and no nays. Motion carried. The meeting was adjourned at 8: 14 p.m. by President Steffenson. Respectfully submitted, Heidi Nelson EDA Secretary  REQUEST FOR EDA ACTION April 6, 2020 EDA 3A DATE AGENDA ITEM ORIGINATING DEPT. AGENDA ITEM CITY ADMINISTRATOR APPROVAL Community and Economic ProMed Development Redevelopment Project Area And TIF Plan Approval Resolution No. 18 PREVIOUS ACTIONS: None by the EDA RECOMMENDED COUNCIL ACTION: Motion to adopt Resolution No. 18 approving the modification of the Redevelopment Plan for Redevelopment Project Area No. 1, Approving the creation of the ProMed Tax Increment Financing District and approving the adoption of a Tax Increment Financing Plan therefor. COMMENTS: Rocky Mountains, LLC has submitted for land use approvals for the construction of a 70,800 square foot medical technology facility building on Wedgwood Rd. The proposed facility would include space for ProMed, a medical-technology business based out of Plymouth, and smaller medical technology companies that would be able to lease the space in an incubator- style partnership. Concurrent with the applications for land use approvals, Rocky Mountain, LLC has requested tax increment financing assistance for the development. The City of Maple Grove and the EDA have statutory powers pursuant to Minnesota Statutes to assist in the financing of public costs related to projects as an incentive for the development to occur. With the use of tax- increment financing, the development must pass a" but-for" test which means the development must prove it would not occur without the use of public assistance. The ProMed development proposal has completed the" but-for" analysis and meets the criteria established by state statute. Redevelopment Project Area and Tax Increment Financing Plan The Establishment of the Redevelopment Plan for Redevelopment Project Area No. 1 and Tax Increment Financing Plan for the Establishment of the ProMed Tax Increment Financing District details the proposed project area and TIF district boundaries while further defining details regarding the tax increment financing district being created. The TIF district to be established is an Economic Development District with a maximum term of 9- years. The TIF district would encompass one property, which is the identified property that the development would occur on. A full copy of the Redevelopment Project Area and TIF Plan is attached. Interfund Loan The EDA will be expending funds for administrative costs for legal and financial advisors for the TIF District creation and administration of the TIF District. Since the TIF District won' t generate TIF for a year or two, Brett Angell, Project Manager— X6003 ProMed TIF Project Area Plan Approval Request for Council Action April 6, 2020 Page 2 the EDA will need to" front" these costs. If the EDA want to be reimbursed for these costs at a future date from TIF funds, then an interfund loan is required before the expenditure is made. Attached is a resolution authorizing an interfund loan of up to $25, 000 from the EDA' s General Fund to the TIF District. The City and EDA will reimburse TIF District# 86- 1 and the EDA' s Development Fund for the above referenced costs( as they are advanced) in the current principal amount, together with interest at the rate of 5% per annum. The interest rate is set at the statutory maximum and will not be adjusted annually. Alignment with Strategic Priorities The proposed use of public assistance aligns with 2018- 2020 strategic priorities that have been established including ensuring strategic investment of city incentives in job producing developments, enhancing business retention, expansion and recruitment programs, and to grow the partnership with key partners including Medical Alley. The proposed development is expected to add over 120 jobs from ProMed within a three- year period from the completion of construction of livable wage jobs. ProMed is a well- respected medical technology business within the Minnesota that creates silicone molded products and implantable drug- eluting products. Medical Alley has voiced their support for the project and is considering the utilization of this new development for future Medical Alley endorsed events. TIF Development Agreement Upon approval of the City Council and EDA of the creation of Redevelopment Project Area 1 and the creation of the ProMed TIF District, the City and EDA will enter into a TIF Development Agreement with the applicant specifying specific items such as minimum improvements, commencement and completion of construction, job and wage goals, and lookback provisions. This item will be brought forward to the City Council and EDA for approval at a future meeting date upon approval. ATTACHMENTS: Attachment A: Resolution No. 18 Attachment B: Redevelopment Project Area No. 1 Plan and Tax Increment Financing Plan  Attachment A EXTRACT OF MINUTES OF MEETING OF THE BOARD OF COMMISSIONERS OF THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF MAPLE GROVE HELD: April 6, 2020 Pursuant to due call and notice thereof, a regular or special meeting of the Economic Development Authority in and for the City of Maple Grove, Hennepin County, Minnesota was duly called and held at the Government Center/Public Safety Facility in the City of Maple Grove, Minnesota on April 6, 2020, at p. m. The following members were present: and the following were absent: Member introduced the following resolution and moved its adoption: RESOLUTION NO. 18 RESOLUTION APPROVING THE MODIFICATION OF THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT AREA NO. 1, APPROVING THE CREATION OF THE PROMED TAX INCREMENT FINANCING DISTRICT AND APPROVING THE ADOPTION OF A TAX INCREMENT FINANCING PLAN THEREFOR BE IT RESOLVED by the Board of Commissioners of the Economic Development Authority in and for the City of Maple Grove( the ' Board") as follows: Section 1. Recitals. 1. 01. It has been proposed that the Economic Development Authority( the " Authority") in and for the City of Maple Grove ( the " City") ( a) establish Redevelopment Project Area No. 1 the" Project Area");( b) adopt a Redevelopment Plan for the Project Area;( c) establish the ProMed Tax Increment Financing District therein ( the " TIF District"); and ( d) approve and adopt the proposed Tax Increment Financing Plan therefor pursuant to and in accordance with Minnesota Statutes, Sections 469. 001 through 469. 047, Sections 469. 090 to 469. 1082, and Sections 469. 174 to 469. 1794, all inclusive, as amended. 1. 02.The Authority has investigated the facts and has caused to be prepared a redevelopment plan for the establishment of the Project Area( the" Redevelopment Plan"), and has caused to be prepared a proposed tax increment financing plan for the TIF District therein ( the TIF Plan"); and 1. 03. The City held a public hearing to approve the Redevelopment Plan and the TIF Plan on April 6, 2020, following not less than 10 days and not more than 30 days published notice in the local newspaper of general circulation. 12477119A  1. 04. The Authority has investigated the facts, and has caused to be prepared the Redevelopment Plan for the Project Area and the TIF Plan for the TIF District, and performed all actions required by law to be performed prior to the establishment of the Project Area and the establishment of the TIF District therein, and the adoption of the Redevelopment Plan and TIF Plan therefor, including, but not limited to, a review of the proposed Redevelopment Plan and TIF Plan by the Planning Commission, notification of Hennepin County and Independent School District No. 279, which have taxing jurisdiction over the property to be included in the TIF District. Section 2. Findings for the Establishment of the Proiect Area and Adoption of the Redevelopment Plan. 2. 01. The Board hereby finds that the land in the Project Area would not be made available for development and redevelopment without the financial aid to be sought. 2. 02. The Board further finds that the Redevelopment Plan will afford maximum opportunity, consistent with the needs of the City as a whole, for the development and redevelopment of the Project Area and adjacent areas by private enterprise; The Board further finds that the Redevelopment Plan conforms to the general plan 2. 03. for the development or redevelopment of the City as a whole, and the anticipated development is in furtherance of long range plans of the City for that area; and 2. 04. The Board further finds that the Redevelopment Plan is intended and, in the judgment of the Board, its effect will be, to promote the public purposes and accomplish the objectives specified in the Redevelopment Plan for the Redevelopment Project Area. Section 3. Approval of the Establishment of Redevelopment Proiect Area No. 1 and the Redevelopment Plan. 3. 01. There is hereby established Redevelopment Project Area No. 1, the initial boundaries of which are fixed and determined as described in the Redevelopment Plan. 3. 02. The Redevelopment Plan, as presented to the Authority on this date, is hereby approved, established, and adopted. 3. 03. The Board hereby requests the City Council to approve the Redevelopment Plan and the establishment of the Project Area. Section 4. Findings for the Establishment of the TIF District and Adoption of the TIF Plan. 4. 01. The TIF District is an economic development district as defined in Minnesota Statutes, Section 469. 174, Subd. 12, the specific basis for such determination is set forth in Appendix C of the TIF Plan. 4. 02.The proposed development, in the opinion of the Authority, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future. The reasons for such determination are set forth in Appendix C of the TIF Plan. 2 12477119v1  4. 03. The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan. The reasons supporting this finding are set forth in Appendix C of the TIF Plan. 4. 04. The TIF Plan for the TIF District conforms to the general plan for development or redevelopment of the City as a whole. The reasons for supporting this finding are set forth in Appendix C of the TIF Plan. 4. 05. The TIF Plan will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of the Project Area by private enterprise. The reasons supporting this finding are set forth in Appendix C of the TIF Plan. 4. 06. The Authority elects to calculate fiscal disparities for the TIF District in accordance with Minnesota Statutes, Section 469. 177, Subd. 3, clause b, which means the fiscal disparities contribution would be taken from inside the TIF District. Section 5. Approval of the Establishment of the TIF District and the TIF Plan. 5. 01. The establishment of the TIF District and the TIF Plan therefor are hereby approved and adopted and the TIF Plan shall be placed on file in the office of the Executive Director of the Authority. 5. 02. The Board hereby requests the City Council to approve the establishment of the TIF District and the TIF Plan. 5. 03. Upon approval by the City Council, the staff of the City and Authority and the City' s and Authority' s advisors and legal counsel are authorized and directed to proceed with the implementation of the TIF Plan for the TIF District. Section 6. Interfund Loan. 6. 01. The Authority has determined that it may pay for certain costs ( the " Qualified Costs") identified in the TIF Plan which costs may be financed on a temporary basis from the Authority's general fund or any other fund from which such advances may be legally made ( the Fund"). Under Minnesota Statutes, Section 469. 178, Subd. 7, the Authority is authorized to advance or loan money from the Fund in order to finance the Qualified Costs. The Authority intends to reimburse itself for the payment of the Qualified Costs, plus interest thereon, from tax increments derived from the TIF District in accordance with the following terms( which terms are referred to collectively as the " Interfund Loan"): Authority shall repay to the Fund from which the Qualified Costs are initially paid, 6. 02. the principal amount of up to$ 25,000( or, if less, the amount actually paid from such fund) together with interest at 5. 00% per annum( which is not more than the greater of( i) the rate specified under Minnesota Statutes, Section 270C. 40, or( ii) the rate specified under Minnesota Statutes, Section 549. 09) from the date of the payment. 3 12477119v1  6. 03. Principal and interest on the Interfund Loan(' Payments") shall be paid annually on each December 31 commencing with the date the tax increments from the TIF District are available and not otherwise pledged to and including the earlier of( a) the date the principal and accrued interest of the Interfund Loan is paid in full, or ( b) the date of last receipt of tax increment from the TIF District (' Payment Dates") which Payments will be made in the amount and only to the extent of available tax increments. Payments shall be applied first to accrued interest, and then to unpaid principal. 6. 04. Payments on the Interfund Loan are payable solely from the tax increment generated in the preceding twelve( 12) months with respect to the TIF District and remitted to the Authority by Hennepin County, all in accordance with Minnesota Statutes, Sections 469. 174 to 469. 1794, as amended. Payments on this Interfund Loan may be subordinate to any outstanding or future bonds, notes or contracts secured in whole or in part with tax increment if approved by the Authority, and are on parity with any other outstanding or future interfund loans secured in whole or in part with tax increments. 6. 05. The principal sum and all accrued interest payable under this Interfund Loan are pre- payable in whole or in part at any time by the Authority without premium or penalty. No partial prepayment shall affect the amount or timing of any other regular payment otherwise required to be made under this Interfund Loan. The Interfund Loan is evidence of an internal borrowing by the Authority in 6. 06. accordance with Minnesota Statutes, Section 469. 178, Subd. 7, and is a limited obligation payable solely from tax increment pledged to the payment hereof under this resolution. The Interfund Loan and the interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, the Authority. Neither the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of or interest on the Interfund Loan or other costs incident hereto except out of tax increment, and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of the principal of or interest on the Interfund Loan or other costs incident hereto. The Authority shall have no obligation to pay any principal amount of the Interfund Loan or accrued interest thereon, which may remain unpaid after the termination of the TIF District. The Authority may amend the terms of the Interfund Loan at any time by resolution 6. 07. of the Board, including a determination to forgive the outstanding principal amount and accrued interest to the extent permissible under law. 4 12477119vl  The motion for the adoption of the foregoing resolution was seconded by member and upon vote being taken thereon, the following voted in favor thereof; and the following voted against the same. Passed and adopted by the Board of Commissioners of the Economic Development Authority in and for the City of Maple Grove, Minnesota, this day of April, 2020. President Attest: Secretary 5 12477119v1 STATE OF MINNESOTA ) ss. COUNTY OF HENNEPIN ) I, the undersigned, being the duly qualified and acting Secretary of the Economic Development Authority in and for the City of Maple Grove, Minnesota, DO HEREBY CERTIFY that I have carefully compared the attached and foregoing extract of minutes with the original minutes of a meeting of the Board of Commissioners of the Economic Development Authority in and for the City of Maple Grove held on the date therein indicated, which are on file and of record in my office, and the same is a full, true and complete transcript therefrom insofar as the same relates to a Resolution approving the establishment of the Redevelopment Plan for the Redevelopment Project Area No. 1, approving the establishment of the ProMed Tax Increment Financing District and the adoption of a tax increment financing plan therefor. WITNESS my hand as such Secretary of the Economic Development Authority in and for the City of Maple Grove this day of April, 2020. Secretary 6 12477119vl  Attachment B ECONOMIC DEVELOPMENT & REDEVELOPMENT IS ESTABLISHMENT OF THE REDEVELOPMENT PLAN Redevelopment Project Area No. 1 AND - TAX INCREMENT FINANCING PLAN Establishment of ProMed Tax Increment Financing District an economic development district) Maple Grove Economic Development Authority City of Maple Grove, Hennepin County, Minnesota Public Hearing: April 6, 2020 BUILDING COMMUNITIES. IT' S WHAT WE DO. J. FREERS LEADER`. IN PUBLIC FINANCE mfo: aehlers- nc. com - 1( 800) 552- 1171 www ehlers- inc corn  Table of Contents Tax Increment Financing Plan for The ProMed Tax Increment Financing District........................ 3 Foreword................................................................................................................................... 3 StatutoryAuthority .................................................................................................................... 3 Statementof Objectives............................................................................................................ 3 Redevelopment Plan Overview................................................................................................. 3 Description of Property in the District and Property to be Acquired.......................................... 4 Classification of the District....................................................................................................... 4 Duration and First Year of Tax Increment of the District........................................................... 5 Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity Value/ Increment and Notification of Prior Planned Improvements....................................................................... 5 Sources of Revenue/ Bonds to be Issued.................................................................................. 7 Usesof Funds........................................................................................................................... 7 Estimated Impact on Other Taxing Jurisdictions....................................................................... 8 Supporting Documentation ..................................................................................................... 10 Administration of the District................................................................................................... 10 Appendix A: Map of Redevelopment Project Area No. 1 and the TIF District........................ 11 Appendix B: Estimated Cash Flow for the District.................................................................. 12 Appendix C: Findings Including But/For Qualifications.......................................................... 13 Maple Grove Economic Development Authority ProMed Tax Increment Financing District 2 Tax Increment Financing Plan for The ProMed Tax Increment Financing District Foreword The Maple Grove Economic Development Authority ( the " EDA"), the City of Maple Grove ( the City"), staff and consultants have prepared the following information to expedite the establishment of the ProMed Tax Increment Financing District ( the " District"), an economic development tax increment financing district, located in Redevelopment Project Area No. 1. Statutory Authority Within the City, there exist areas where public involvement is necessary to cause development or redevelopment to occur. To this end, the EDA and City have certain statutory powers pursuant to Minnesota Statutes (" M. S."), Sections 469. 090- 469. 1082, Sections 469. 001 - . 047 inclusive, as amended, and M. S., Sections 469. 174 to 469. 1794, inclusive, as amended( the" Tax Increment Financing Act" or" TIF Act"), to assist in financing public costs related to this project. This section contains the Tax Increment Financing Plan ( the " TIF Plan") for the District. Other relevant information is contained in the Redevelopment Plan for Redevelopment Project Area No. 1. Statement of Objectives The District currently consists of one parcel of land and adjacent and internal rights-of-way. The District is being created to facilitate the construction of a 92, 400 sq/ ft Biomedical Manufacturing/ R& D/ Office and warehouse facility in two phases in the City. The EDA intends to enter into an agreement with ProMed and development is anticipated to begin in 2020. This TIF Plan is expected to achieve many of the objectives outlined in the Redevelopment Plan for Redevelopment Project Area No. 1. The activities contemplated in the Redevelopment Plan and the TIF Plan do not preclude the undertaking of other qualified development or redevelopment activities. These activities are anticipated to occur over the life of Redevelopment Project Area No. 1 and the District. Redevelopment Plan Overview Pursuant to the Redevelopment Plan and authorizing state statutes, the EDA or City is authorized to undertake the following activities in the District: 1. Property to be Acquired - Selected property located within the District may be acquired by the EDA or City and is further described in this TIF Plan. 2. Relocation - Relocation services, to the extent required by law, are available pursuant to M.S., Chapter 117 and other relevant state and federal laws. 3. Upon approval of a developer's plan relating to the project and completion of the Maple Grove Economic Development Authority ProMed Tax Increment Financing District 3  necessary legal requirements, the EDA or City may sell to a developer selected properties that it may acquire within the District or may lease land or facilities to a developer. 4. The EDA or City may perform or provide for some or all necessary acquisition, construction, relocation, demolition, and required utilities and public street work within the District. 5. The City proposes both public and private infrastructure within the District. The proposed reuse of private property within the District will be for a Biomedical Manufacturing/ R& D/ Office and warehouse facility, and there will be continued operation of Redevelopment Project Area No. 1 after the capital improvements within Redevelopment Project Area No. 1 have been completed. Description of Property in the District and Property to be Acquired The District encompasses all property and adjacent rights- of-way and abutting roadways identified by the parcel listed below. number Address O 34- 119- 22- 12- 0021 Not Assigned Wedgewood Equities, LLC Please also see the map in Appendix A for further information on the location of the District. The EDA or City may acquire any parcel within the District including interior and adjacent street rights of way. Any properties identified for acquisition will be acquired by the EDA or City only in order to accomplish one or more of the following: storm sewer improvements; provide land for needed public streets, utilities and facilities; carry out land acquisition, site improvements, clearance and/ or development to accomplish the uses and objectives set forth in this plan. The EDA or City may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of this TIF Plan. Such acquisitions will be undertaken only when there is assurance of funding to finance the acquisition and related costs. Classification of the District The EDA or City, in determining the need to create a tax increment financing district in accordance with M. S., Sections 469. 174 to 469. 1794, as amended, inclusive, finds that the District, to be established, is an economic development district pursuant to M. S., Section 469. 174, Subd. 12. The District is in the public interest because it will meet the statutory requirement of discouraging commerce, industry, or manufacturing from moving their operations to another state or municipality; resulting in increased employment in the State; and resulting in preservation and enhancement of the tax base of the State. Pursuant to M. S., Section 469. 176, Subd. 4c, revenue derived from tax increment from an economic development district may not be used to provide improvements, loans, subsidies, grants, interest rate subsidies, or assistance in any form to developments consisting of buildings and ancillary facilities, if more than 15 percent of the buildings and facilities ( determined on the basis of square footage) are used for a purpose other than: Maple Grove Economic Development Authority ProMed Tax Increment Financing District 4  1) The manufacturing or production of tangible personal property, including processing resulting in the change in condition of the property; 2) Warehousing, storage, and distribution of tangible personal property, excluding retail sales; 3) Research and development related to the activities listed in items ( 1) or( 2); 4) Telemarketing if that activity is the exclusive use of the property; or 5) Tourism facilities; 6) Space necessary for and related to the activities listed in items ( 1) to ( 5); or 7) A workforce housing project that satisfies the requirements of M. S., Section 469. 176, Subd. 4c( d). In meeting the statutory criteria the City relies on the following facts and findings: The facilities in the District meet the conditions of purposes 1, 2, 3 and 6. Pursuant to M. S., Section 469. 176, Subd. 7, the District does not contain any parcel or part of a parcel that qualified under the provisions of M. S., Sections 273. 111, 273. 112, or 273. 114 or Chapter 473H for taxes payable in any of the five calendar years before the filing of the request for certification of the District. Duration and First Year of Tax Increment of the District Pursuant to M.S., Section 469. 175, Subd. 1, and M.S., Section 469. 176, Subd. 1, the duration of the District must be indicated within the TIF Plan. Pursuant to M.S., Section 469. 176, Subd. 1b., the duration of the District will be 8 years after receipt of the first increment by the EDA. The date of receipt by the EDA of the first tax increment is expected to be 2022. Thus, it is estimated that the District, including any modifications of the TIF Plan for subsequent phases or other changes, would terminate after, or when the TIF Plan is satisfied. If increment is received in 2021, the term of the District will be 2029. The EDA and City reserve the right to decertify the District prior to the legally required date. Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity Value/ Increment and Notification of Prior Planned Improvements Pursuant to M.S., Section 469. 174, Subd. 7 and M.S., Section 469. 177, Subd. 1, the Original Net Tax Capacity( ONTC) as certified for the District will be based on the market values placed on the property by the assessor in 2019 for taxes payable 2020. Pursuant to M.S., Section 469. 177, Subds. 1 and 2, the County Auditor shall certify in each year beginning in the payment year 2021) the amount by which the original value has increased or decreased as a result of: 1. Change in tax exempt status of property; 2. Reduction or enlargement of the geographic boundaries of the district; 3. Change due to adjustments, negotiated or court- ordered abatements; 4. Change in the use of the property and classification; 5. Change in state law governing class rates; or 6. Change in previously issued building permits. Maple Grove Economic Development Authority ProMed Tax Increment Financing District 5 In any year in which the current Net Tax Capacity ( NTC) value of the District declines below the ONTC, no value will be captured and no tax increment will be payable to the EDA or City. The original local tax rate for the District will be the local tax rate for taxes payable 2020, assuming the request for certification is made before June 30, 2020. The ONTC and the Original Local Tax Rate for the District appear in the table below. Pursuant to M.S., Section 469. 174 Subd. 4 and M.S., Section 469. 177, Subd. 1, 2, and 4, the estimated Captured Net Tax Capacity ( CTC) of the District, within Redevelopment Project Area No. 1, upon completion of the projects within the District, will annually approximate tax increment revenues as shown in the table below. The EDA and City request 100 percent of the available increase in tax capacity for repayment of its obligations and current expenditures, beginning in the tax year payable 2022. The Project Tax Capacity ( PTC) listed is an estimate of values when the projects within the District are completed. Project Tax Capacity Project estimated Tax Capacity upon completion 254, 806 Original estimated Net Tax Capacity 13, 020 Fiscal Disparities 88, 019 Estimated Captured Tax Capacity 163, 766 Original Local Tax Rate 104. 3560% Final Pay 2020 Estimated Annual Tax Increment 160, 466 Percent Retained by the City 100% Note: Tax capacity includes a 3% inflation factor for the duration of the District The tax capacity included in this chart is the estimated tax capacity of the District in year 9. The tax capacity of the District in year one is estimated to be$ 155, 010. Pursuant to M.S., Section 469. 177, Subd. 4, the EDA shall, after a due and diligent search, accompany its request for certification to the County Auditor or its notice of the District enlargement pursuant to M.S., Section 469. 175, Subd. 4, with a listing of all properties within the District or area of enlargement for which building permits have been issued during the eighteen 18) months immediately preceding approval of the TIF Plan by the municipality pursuant to M. S., Section 469. 175, Subd. 3. The County Auditor shall increase the original net tax capacity of the District by the net tax capacity of improvements for which a building permit was issued. The City has reviewed the area to be included in the District and found no parcels for which building permits have been issued during the 18 months immediately preceding approval of the TIF Plan by the City. Maple Grove Economic Development Authority ProMed Tax Increment Financing District 6 Sources of Revenue/ Bonds to be Issued The total estimated tax increment revenues for the District are shown in the table below: 110111 Tax Increment 1, 243, 295 Interest 124, 330 TOTAL 1, 367, 625 The costs outlined in the Uses of Funds will be financed primarily through the annual collection of tax increments. The EDA or City reserves the right to incur bonds or other indebtedness as a result of the TIF Plan. As presently proposed, the projects within the District will be financed by pay- as- you- go notes and interfund loans. Any refunding amounts will be deemed a budgeted cost without a formal TIF Plan Modification. This provision does not obligate the EDA or City to incur debt. The EDA or City will issue bonds or incur other debt only upon the determination that such action is in the best interest of the City. The EDA or City may issue bonds ( as defined in the TIF Act) secured in whole or in part with tax increments from the District in a maximum principal amount of$ 1, 150, 936. Such bonds may be in the form of pay-as-you-go notes, revenue bonds or notes, general obligation bonds, or interfund loans. This estimate of total bonded indebtedness is a cumulative statement of authority under this TIF Plan as of the date of approval. Uses of Funds Currently under consideration for the District is a proposal to facilitate the construction of a 92, 400 sq/ft Biomedical Manufacturing/ R& D/ Office and warehouse facility in two phases in the City. The EDA and City have determined that it will be necessary to provide assistance to the project for certain District costs, as described. The EDA has studied the feasibility of the development or redevelopment of property in and around the District. To facilitate the establishment and development or redevelopment of the District, this TIF Plan authorizes the use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs and uses of funds associated with the District is outlined in the following table: Land/ Building Acquisition 500, 000 Site Improvements/ Preparation 100, 000 Utilities 200, 000 Other Qualifying Improvements 226, 606 Administrative Costs ( up to 10%) 124, 330 PROJECT COSTS TOTAL 1, 150, 936 Interest 216, 689 PROJECT AND INTEREST COSTS TOTAL 1, 367, 625 Maple Grove Economic Development Authority ProMed Tax Increment Financing District 7 The total project cost, including financing costs( interest) listed in the table above does not exceed the total projected tax increments for the District as shown in the Sources of Revenue section. Estimated capital and administrative costs listed above are subject to change among categories by modification of the TIF Plan without hearings and notices as required for approval of the initial TIF Plan, so long as the total capital and administrative costs combined do not exceed the total listed above. Further, the EDA may spend up to 20 percent of the tax increments from the District for activities( described in the table above) located outside the boundaries of the District but within the boundaries of the Project ( including administrative costs, which are considered to be spend outside the District), subject to all other terms and conditions of this TIF Plan. Fiscal Disparities Election Pursuant to M.S., Section 469. 177, Subd. 3, the EDA or City may elect one of two methods to calculate fiscal disparities. The EDA will choose to calculate fiscal disparities by clause b( inside). Estimated Impact on Other Taxing Jurisdictions The estimated impact on other taxing jurisdictions assumes that the redevelopment contemplated by the TIF Plan would occur without the creation of the District. However, the EDA and City has determined that such development or redevelopment would not occur " but for" tax increment financing and that, therefore, the fiscal impact on other taxing jurisdictions is $ 0. The estimated fiscal impact of the District would be as follows if the" but for" test was not met: on Tax Base 2019/ Pay 2020 Es Captured Tax Percent of CTC Entity Total Net Tax Capacity( CTC) to Entity Total Capacity upon completion County 1, 941, 694, 561 153, 766 0. 0079% City 105, 007, 395 153, 766 0. 14640/6 ISD 188, 899, 196 153, 766 0. 0814°/. Impact on Tax Rates Pay 2020 Potential Entity Percent of Total CTC Extension Rate Taxes County 41. 0840% 39. 37% 153, 766 63, 173 City 32. 8880% 31. 52% 153, 766 60, 571 ISD 22. 0080% 21. 09% 153, 766 33, 841 Other 8. 3760% 8. 03% 153, 766 12, 879 Total 104.3560% 100. 00% 160, 465 Maple Grove Economic Development Authority ProMed Tax Increment Financing District 8 The estimates listed above display the captured tax capacity when all construction is completed. The tax rate used for calculations is the Pay 2020 rate. The total net capacity for the entities listed above are based on Pay 2020 figures. The District will be certified under the final Pay 2020 rates. Pursuant to M.S. Section 469. 175 Subd. 2( b): 1) Estimate of total tax increment. It is estimated that the total amount of tax increment that will be generated over the life of the District is$ 1, 243,295; 2) Probable impact of the District on city provided services and ability to issue debt. An impact of the District on police protection is not expected. The City does not expect that the proposed development, in and of itself, will necessitate new capital investment in vehicles or facilities. The probable impact of the District on fire protection is not expected to be significant. Typically new buildings generate few calls, if any, and are of superior construction. The City does not expect that the proposed development, in and of itself, will necessitate new capital investment in vehicles or facilities. The impact of the District on public infrastructure is expected to be minimal. The development is not expected to significantly impact any traffic movements in the area. The current infrastructure for sanitary sewer, storm sewer and water will be able to handle the additional volume generated from the proposed development. Based on the development plans, there are no additional costs associated with street maintenance, sweeping, plowing, and sidewalks. The probable impact of any City general obligation tax increment bonds on the ability to issue debt for general fund purposes is expected to be minimal. It is not anticipated that there will be any general obligation debt issued in relation to this project, therefore there will be no impact on the City' s ability to issue future debt or on the City' s debt limit. 3) Estimated amount of tax increment attributable to school district levies. It is estimated that the amount of tax increments over the life of the District that would be attributable to school district levies, assuming the school district's share of the total local tax rate for all taxing jurisdictions remained the same, is$ 262, 203; 4) Estimated amount of tax increment attributable to countv levies. It is estimated that the amount of tax increments over the life of the District that would be attributable to county levies, assuming the county' s share of the total local tax rate for all taxing jurisdictions remained the same, is$ 489, 474; 5) Additional information requested by the countv or school district. The City is not aware of any standard questions in a county or school district written policy regarding tax increment districts and impact on county or school district services. The county or school district must request additional information pursuant to M.S. Section 469. 175 Subd. 2(b) within 15 days after receipt of the tax increment financing plan. No requests for additional information from the county or school district regarding the proposed development for the District have been received. Maple Grove Economic Development Authority ProMed Tax Increment Financing District 9 Supporting Documentation Pursuant to M.S. Section 469. 175, Subd. 1 ( a), clause 7 the TIF Plan must contain identification and description of studies and analyses used to make the determination set forth in M. S. Section 469. 175, Subd. 3, clause ( b)( 2) and the findings are required in the resolution approving the District. i) In making said determination, reliance has been placed upon( 1) written representation made by the developer to such effects, (2) review of the developer's proforma; and ( 3) City staff awareness of the feasibility of developing the project site within the District, and, ( 4) the findings contained in Appendix C. ii) A comparative analysis of estimated market value both with and without establishment of the TIF District and the use of tax increments has been performed. Such analysis is included with the cashflow in Appendix B and indicates that the increase in estimated market value of the proposed development ( less the indicated subtractions) exceeds the estimated market value of the site absent the establishment of the TIF District and the use of tax increments. Administration of the District Administration of the District will be handled by the Economic Development Manager. Maple Grove Economic Development Authority ProMed Tax Increment Financing District 10 Appendix A: Map of Redevelopment Project Area No. 1 and the TIF District Maple Grove Economic Development Authority 11 ProMed Tax Increment Financing District  z O O. 1 p; z 13RD A -E- N-( GOUNTY ROAD 30) Op N: RVEN q ROAI& z 7 F1AvE N•( EL•M• C-RE-Ery L ) peAD-10 Ris Gapl1 4 16 0 J- i V`— W sy ao O. 4 MNNALNN SM AVEN D am PL- N s ProMed TIF District 67TH AVE N-- Promeg Tax increment Financing Diltrict M APLE GROVE Redevelopment Project Area No. 1 ertHp N i rb a Succeeding today. Growing tomorrow. Appendix B: Estimated Cash Flow for the District Maple Grove Economic Development Authority 12 ProMed Tax Increment Financing District  316/ 2020 Base Value Assumptions- Page 1 g'*' 4EHLERS LEADERS Pro Mod IV PUBLIC FINANCE City of Maple Grove 92. 400 SgFt Biomedical Office/ Manufacturing ASSUMPTIONS • RATES DlsfitctType: Economic Development Tax Rates District NamalNumber: County District•: Exempt Class Rate( Exempt) 0. 00% First Year Construction or Inflation on Value 2020 Commercial Industrial Preferred Claw Rate( CA Pref.) First $ 150, 000 1. 50% Existing District- Specify No. Years Remaining Inflation Rate- Every Year. 3. 00% Over $ 150, 000 200% Interest Rate: 4. 00% Commercial Industrial Class Rate( CA) 200% Present Value Date: 1- Aug- 21 Rental Houalng Class Rate( Rental) 1. 25% First Period Ending 1- Feb- 22 Alfordade Rents Housiryl Class Rate( Ag. Rental) Tax Year District was Certified: Pay 2020 First $ 150, 000 0. 75% Cashnow Assumes First Tax Increment For Development: 2022 Over $ 150, 000 0. 25% Years of Tax Increment 9 Non- Homeatead Residential( No" Res. 1 Unit) Asaumas Last Year of Tax increment 2030 First $ 500, 000 1. 00% Fiscal Disparities Election[ Outside( A), Inside( B). or NA] Insids( B) Over $ 500, 1100 Incremental or Tota( Fiscal Disparities Incremental Homestead Residential Class Rate( Hmsfd. Res.) Fiscal Disparities Contribution Ratio 36. 4036% Final Pay 2020 First 3SD0,0D0 1. 00% Fiscal Disparities Metro- Wide Tax Rate 1424540% Final Pay 2020 Over $ 500, 000 1. 25% Maximum/ Frozen Local Tax Rate: 104. 356% Agricultural Non- Homestead 1. 00% Final Pay 2020 Current Local Tax Rate:( Use lesser of Current or Max.) 104. 356% Final Pay 2020 State- wide Tax Rate( Comm./ Ind. only used for total taxes) 38. 8460% Final Pay 2020 Market Value Tax Rate( Used for total taxes) 0. 25606% Final Pay 2D20 Original VA Building Total Percentage Tax Year Property Current Class After Land Market Market Of Value Used original Original Tax Original Attar Conversion Owner Address Market Value Value Value for District Market Value Market Value Class Tax Cab" Conversion Oriq. Tax Cap. Map ID PID 1 34- 119- 22- 12- 0021 Wedgewood Equities, LLC Na Auisnsd 688, 500 688, 500 100% 688, 50D Pay 2020 CA Pref. 13,020 CA Pref. 13, 020 on. S D 13. 020 13, 0211 Note: 1. Base values are for pay 2020 based upon review of County website on 1- 2- 2020. 2. Located In SD A279 and WS 48 P ,- f by ENan aAuodetn, Inc.- EW— W ONy N: WN.- W.* E— nic- Radevebprnn TIRTIF OIsekaV-, o d 2a20111F Plan Run 2- 18- 20 FINS  31= 020 Base Value Assumptions- Page 2 g%. EHLERS LEADERS IN PUBLIC rINANCE Pro Mod City of Maple Grove 92, 400 SgFt Biomedical OIMdManufacturfng PROJECT •` • Estimated Tax" TOW Taxable Percentage pw— tage Percentage Percentile Property Market Value Ma' Was, Total Market Tax Project Project Tax Completed Completed Completed Completed AredPbas• New use Per Sq. Ft AJnit Par Sq. FLAW Sq. FtJUnks value Class Tax Capacity Capacity/ Unk 2020 2021 2022 2023 1 Office 110 110 70, 600 7, 780, 000 CA Pret 155,010 2 1D0% 100% 100% 100% 2 ManufachAr., 110 110 21. 600 2376000 CA 47520 2 D% 100% 100% 100% I TOTAL 7d.7, u00 2530 ISubtete) Besklamial 0 U 0 ISubtofal CommerdalAnd. 92. 400 10. 1e4. 000 202AW Note: 1. Market values are based upon estimates from City Assessor. CAL s sa e a Now Okice I1aa Tax Ca• adt_y 155. 010 Disparities Av Tax C`12-- 56. 430 Tax CaparJy 98. 580 Property Taxes 102, 575 Dtspsrklea Taxes 110, 366 Property Taxes 59, 632 Value Texas 19, 942 Total Taxes 252, 05 Taxes Sq. . 3.71 th Per t Manufactudna 47{ 520 17. 299 30 221 ] 24, 643 17 8tl] 6. 984 77YY, 47 3. 70 1, I537 l iorAL ZaZ, 530 73, jZo 7Z•• 01 1J4, 47z 7Ot1,b29 7 37s 26; 026 di taz l 1.Note.Taxes and tax Increment will vary significantly from year to year depending upon values, rates, state law, fiscal disparities and other factors which cannot be predicted. 2. if tax increment in received in 2021, then the district will be one year shorter. ANALYSIS 342, 82 Current Markat V a ue 5511 00 roperly axes , leu State- side Taxes 77, 315) New Market Value- lu Est 10 164 000 leu Fiscal Disp. Adj. 105, 029) Difference ti,a'+i'a`Suu less Market Value Taxes 26, 028) Present Value of Tax Increment less Base Value Taxes 8, W1) Difference Bd65: 3de Annual Gross TIE Value likely to occur without Tax Increment isle than:) A, , l7A P pwl by ENen a AuoWtx, Inc.- E, Wrrahf a,y N: WMnwhWxpk Grow Wousinp- Emnomic- RMavNopmerMTIFlTIF ITNAcbWroMad 20a0RIF Plrn ftun 2. 162D FINAL  3/ 612020 Tax Increment Cashflow- Page 3 ISEHLERS16A9® lt IX Nel1C FlIrMICE Pro Med City of Maple Grove 92, 400 SgFt Biomedical Office/ Manufacturing TAX INCREMENT CASH FLOW Original Fiscal Captured Local Annual Semi Annwl State Admin. Se: i nnwl Semi- Annual PERIOD P- Jed of Tax Tax D11"" ss Tax Tax Gross Tax Gross Tax Auditor at Net Tax Present ENDING Tax Payment OTC Capacity Capacity Incremental Capacity Rah Increment Increment 0.36% 10% Increment Value Yrs. Year Date 0210122 100% 155, 010 ( 13, 020) ( 51, 690) 90. 300 104.356% 94, 234 47, 117 ( 170) ( 4,695) 42, 253 40,612 0. 5 2022 ON0122 47, 117 ( 170) ( 4, 695) 42, 253 80.427 1 2022 02/ 0123 100% 207, 180 ( 13, 020) ( 70, 682) 123, 479 104. 356% 128, 857 64, 429 ( 232) ( 6, 420) 57, 777 133. 804 1. 5 2023 08/ 0123 64, 429 ( 232) ( 6,420) 57, 777 186, 135 2 2023 0210124 100% 213, 396 ( 13, 020) ( 72. 944) 127, 431 1D4. 356% 132, 982 66, 491 ( 239) ( 6, 625) 50, 627 239,081 2. 5 2024 08I0124 66, 491 ( 239) ( 6, 625) 59, 627 290,990 3 2024 02/ D125 100% 219, 798 ( 13, 02D) ( 75, 275) 131, 503 104. 356% 137, 231 68,615 ( 247) ( 6, 837) 61, 532 343, 507 3. 5 2025 0810125 68, 615 ( 247) ( 6, 837) 61, 532 394, 994 4 2025 0210126 100% 226, 392 ( 13, 020) ( 77, 676) 135, 696 104. 356% 141, 607 70, 804 ( 255) ( 7, 055) 63,494 447, 081 4. 5 2026 08/ 0126 70, 804 ( 255) ( 7, 055) 63. 494 498, 146 5 2026 0210127 100% 233, 183 ( 13, 020) ( 80, 148) 140, 015 104. 356% 146, 115 73, 057 ( 263) ( 7, 279) 65. 515 549, 804 5. 5 2027 08/ 0127 73, 057 ( 263) ( 7, 279) 65, 515 600, 449 6 2027 0210128 100% 240, 179 ( 13, 020) ( 82, 694) 144, 464 104. 356% 150, 757 75,379 ( 271) ( 7, 511) 67, 597 651, 679 6. 6 2028 08/ 01/ 28 75, 379 ( 271) ( 7, 511) 67, 597 701, 904 7 2028 02/ 0129 100% 247, 384 ( 13, 020) ( 85, 317) 149, 047 104. 356% 155. 539 77, 770 ( 280) ( 7, 749) 69, 741 762,707 7. 5 2029 0810129 77,770 ( 280) ( 7, 749) 69,741 802,513 8 2029 02/ 01/ 30 100% 254, 806 ( 13, 020) ( 88, 019) 153, 766 104. 356% 160, 465 80, 232 ( 289) ( 7, 994) 71, 949 852, 889 8. 5 2030 08/ 01/ 30 80, 232 ( 289) ( 74994) 71949 902. 277 9 2030 02/ 01/ 31 Total 1, 247, 197 ( 4,492) ( 1 i28j 1, 110, 984 Prsaant Value From OSM12021 ' Present Value Rate 4. 00% 1. 006. 152 W„ 0221 ( 1041. 253) 902r277 Pmpared by EN.. B AQodabR lne.- Ead- tea Only NVkmomy, SpIe GmveWouarg- Emmmk- Redevelop- Wr[ RTIF DWrIcaWroMed 202nRIF Plan Run 2- 18- 20 FINAL Appendix C: Findings Including But/ For Qualifications The reasons and facts supporting the findings for the adoption of the Tax Increment Financing Plan for ProMed Tax Increment Financing District as required pursuant to M.S., Section 469. 175, Subd. 3 are as follows: 1. Finding that ProMed Tax Increment Financing District is an economic development district as defined in M. S., Section 469. 174, Subd. 12. ProMed Tax Increment Financing District is a contiguous geographic area within the City' s Redevelopment Project Area No. 1, delineated in the TIF Plan, for the purpose of financing economic development in the City through the use of tax increment. The District is in the public interest because it will facilitate the construction of a 92, 400 sq/ ft Biomedical Manufacturing/ R& D/ Office and warehouse facility in two phases in the City, which will increase employment in the State and preserve and enhance the tax base of the state. 2. Finding that the proposed development, in the opinion of the City Council, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and that the increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in the market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of ProMed Tax Increment Financing District permitted by the TIF Plan. The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future: This finding is supported by the fact that the development proposed in this plan is biomedical manufacturing facility that meets the City' s objectives for economic development. The cost of land acquisition, excess unbuildable land and related site improvements necessary to maximize development potential, makes development of the facility infeasible without City assistance. The developer was asked for and provided a letter and a proforma as justification that the developer would not have gone forward without tax increment assistance. The increased market value of the site that could reasonably be expected to occur without the use of tax increment financing would be less than the increase in market value estimated to result from the proposed development after subtracting the present value of the projected tax increments for the maximum duration of the TIF District permitted by the TIF Plan: The City supported this finding on the grounds that the costs of land acquisition, unbuildable land and related site improvements add to the total development costs. This parcel of land has been vacant for a long time and no other qualifying use has approached the City to develop on it. The City reasonably determines that no other development of similar scope is anticipated on this site without substantially similar assistance being provided to the development. Therefore, the City concludes as follows: a. The City' s estimate of the amount by which the market value of the entire District will increase without the use of tax increment financing is$ 0. Maple Grove Economic Development Authority ProMed Tax Increment Financing District 13  b. If the proposed development occurs, the total increase in market value will be 9, 475, 500 ( see Appendix B of the TIF Plan) c. The present value of tax increments from the District for the maximum duration of the district permitted by the TIF Plan is estimated to be $ 1, 006, 152 ( see Appendix B of the TIF Plan). d. Even if some development other than the proposed development were to occur, the Council finds that no alternative would occur that would produce a market value increase greater than $ 8, 469, 348 ( the amount in clause b less the amount in clause c) without tax increment assistance. 3. Finding that the TIF Plan for ProMed Tax Increment Financing District conforms to the general plan for the development or redevelopment of the municipality as a whole. The Planning Commission reviewed the TIF Plan on March 30, 2020 and found that the TIF Plan and Redevelopment Project Area No. 1 conforms to the general development plans of the City. 4. Finding that the Tax Increment Financing Plan for ProMed Tax Increment Financing District will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development of Redevelopment Project Area No. 1 by private enterprise. The project to be assisted by the District will result in increased employment in the City and the State of Minnesota, increased tax base of the State, and add a high- quality development to the City. Maple Grove Economic Development Authority ProMed Tax Increment Financing District 14