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HomeMy WebLinkAboutOak Park Heights General Obligation Bonds 2009 City of Oak Park Heights, Minnesota Development Plan for MUNICIPAL DEVELOPMENT DISTRICT NO. 1 & Tax Increment Financing Plan for TAX INCREMENT FINANCING DISTRICT NO. 1-1 (Renewal and Renovation) (Oakgreen Project) Adopted: June 9, 2009 PREPARED BY Northland Securities, Inc. 45 South 7th Street - Suite 2000 Minneapolis, MN 55402 (800) 851-2920 Member FINRA and SIPC TABLE OF CONTENTS CITY OF OAK PARK HEIGHTS, MINNESOTA Development Plan for MUNICIPAL DEVELOPMENT DISTRICT NO. 1 & Tax Increment Financing Plan for TAX INCREMENT FINANCING DISTRICT NO. 1-1 (Renewal and Renovation) (Oakgreen Project) Adopted June 9, 2009 1 TIF Plan 01.15.11 2 Resolution Calling for Hearing 3 Notices - County and School 4 Publication Request 05.07.09 5 Publication Affidavit 6 Planning Commission Resolution 7 City Council Establishing Resolution 8 Certification Request Supplement 9 Filing - Request for Certification County 10 Filing - Department of Revenue 11 Filing - OSA 12 Executed TIF Agreement 13 Executed Development Agreement 14 Carriage House Plat 15 Renewal TIF Summary Spreadsheet Revised June 1, 2009 16 Oak Park Heights TIF Final Report Revised 06-01-09 16A Substandard Building Report-5800 Oakgreen Ave revised 6-1-09 16B Substandard Building Report-5762 Oakgreen Ave revised 6-1-09 16C Substandard Building Report-5754 Oakgreen Ave revised 6-1-09 16D Substandard Building Report-5710 Oakgreen Ave revised 6-1-09 16E Substandard Building Report Template-5830 Oakgreen Ave revised 6-1-09 16F Not Substandard Building Report Template-5770 Oakgreen Ave revised 6-1-09 17 Nolde TIF application 03.24.09 18 Northland City Memo 04.08.09 CITY OF OAK PARK HEIGHTS, MN Development Program for MUNICIPAL DEVELOPMENT DISTRICT NO. 1 AND TAX INCREMENT FINANCING DISTRICT NO. 1-1 (RENEWAL AND RENOVATION) Tax Increment Financing Plan for Oakgreen Project Adopted: June 9, 2009 PLAN DOCUMENTS PREPARED BY Northland Securities, Inc. 45 South 7th Street - Suite 2500 Minneapolis, MN 55402 (800) 851-2920 Member FINRA and SIPC TABLE OF CONTENTS ARTICLE I – DEFINITIONS AND EXHIBITS Section 1.01 Definitions .............................................................................................................1 Section 1.02 Introduction............................................................................................................2 Section 1.03 Exhibit Reference/Description...............................................................................2 ARTICLE II – STATEMENT OF PUBLIC PURPOSE AND AUTHORITY Section 2.01 Statement of Need and Public Purpose..................................................................3 Section 2.02 Statutory Authority................................................................................................3 ARTICLE III – DEVELOPMENT PROGRAM Section 3.01 Statement of Objectives.........................................................................................4 Section 3.02 Boundaries of Development District .....................................................................4 Section 3.03 Development Activities ......................................................................................4-5 Section 3.04 Payment f Public Costs..........................................................................................5 Section 3.05 Environmental Controls; Land Use Regulations ...................................................5 Section 3.06 Park and Open Space to be Created.......................................................................5 Section 3.07 Proposed Reuse of Property...................................................................................6 Section 3.08 Administration and Maintenance of Development District...................................6 Section 3.09 Relocation..............................................................................................................6 Section 3.10 Amendments..........................................................................................................6 Section 3.11 Estimates of Public Costs and Budget...................................................................6 ARTICLE IV – TAX INCREMENT FINANCING PLAN Section 4.01 Statement of Need and Public Purpose..................................................................7 Section 4.02 Statutory Authority................................................................................................7 Section 4.03 Statement Objectives .............................................................................................7 Section 4.04 Redevelopment District Designation..................................................................7-8 Section 4.05 Duration of the Tax Increment Financing District.................................................8 Section 4.06 Specific Development Expected to Occur Within the TIF District.......................9 Section 4.07 Parcels(s) to be Included in the TIF District..........................................................9 Section 4.08 Property to be Acquired in the TIF District...........................................................9 Section 4.09 Findings and Need for Tax Increment Financing.............................................9-11 Section 4.10 Estimated Sources of Revenue/Public Costs .......................................................11 Section 4.11 Estimated Amount of Bonded Indebtedness........................................................11 Section 4.12 Original Net Tax Capacity..............................................................................11-12 Section 4.13 Original Local Tax Capacity Rate.......................................................................12 Section 4.14 Projected Retained Captured Net Tax Capacity and Projected Tax Increment...12 Section 4.15 Use of Tax Increment ..........................................................................................13 Section 4.16 Excess Tax Increment.....................................................................................13-14 Section 4.17 County Road Costs..............................................................................................14 Section 4.18 Four-Year Rule - Limitations on Property Not Subject to Improvements...........14 Section 4.19 Five-Year Rule - Tax Increment Pooling........................................................14-15 Section 4.20 Limitations on Administrative Expenses........................................................15-16 Section 4.21 Estimated Impact on Other Taxing Jurisdictions.................................................16 Section 4.22 Prior Planned Improvements................................................................................17 Section 4.23 Development Agreements....................................................................................17 Section 4.24 Assessment Agreements ......................................................................................17 Section 4.25 Modifications of the Tax Increment Financing Plan ......................................17-18 Section 4.26 Administration of the Tax Increment Financing Plan..........................................18 Section 4.27 Financial Reporting and Disclosure Requirements.........................................19-22 Section 4.28 Business Subsidy Compliance........................................................................22-23 Map of the Development District.......................................................................................... EXHIBIT I Map of the Tax Increment Financing District....................................................................... EXHIBIT IA Property Description............................................................................................................. EXHIBIT IB Sources and Uses Statement ................................................................................................. EXHIBIT II TIF District Assumptions Report.......................................................................................... EXHIBIT III Projected Tax Increment Report........................................................................................... EXHIBIT IV Estimated Impact on Other Taxing Jurisdictions Report...................................................... EXHIBIT V Market Value Analysis Report.............................................................................................. EXHIBIT V Article I – Definitions, Introduction and Exhibits City of Oak Park Heights, Minnesota 1 Section 1.01 Definitions The terms defined in this section have the meanings given herein, unless the context in which they are used indicates a different meaning: "City" means the City of Oak Park Heights, Minnesota; also referred to as a "Municipality". "City Council" means the City Council of the City; also referred to as the "Governing Body". "County" means Washington County, Minnesota. "Development District Act" means Minnesota Statutes, Sections 469.124 through 469.134, as amended and supplemented from time to time. "Development District" means Municipal Development District No. 1 in the City, created and established pursuant to and in accordance with the Development District Act as described in Section 3.02 of the Development Program. "Development Program" means the Development Program for the Development District, as amended and supplemented from time to time. "Land Use Regulations" means all federal, state and local laws, rules, regulations, ordinances and plans relating to or governing the use or development of land in the City, including but not limited to environmental, zoning and building code laws and regulations. "Project Area" means the geographic area of the Development District. "Public Costs" means the costs set forth in Sections 4.10 and 4.15 of the Tax Increment Financing Plan, repayment of debt service on any Tax Increment Bonds, and any other eligible costs set forth in the Tax Increment Financing Plan, Development Program, or Minnesota Statutes, Section 469.176, subdivision 4. "Public Improvements" means the public improvements, if any, described in Section 3.03 of the Development Program and Section 4.10 of the Tax Increment Financing Plan. "School District" means Independent School District No. 834, Washington County, Minnesota. "State" means the State of Minnesota. "TIF Act" means Minnesota Statutes, Sections 469.174 through 469.1791, both inclusive. "TIF District" means Tax Increment Financing (Renewal and Renovation) District No. 1-1. "TIF Plan" means the tax increment financing plan for the TIF District. Article I – Definitions, Introduction and Exhibits City of Oak Park Heights, Minnesota 2 Section 1.02 Introduction The City of Oak Park Heights has agreed to provide tax increment financing assistance to Anchobaypro, Inc. related to public costs for the development of a 48-unit residential senior cooperative and a 120-unit assisted living facility within the City. It has been stated, in writing, by Anchobaypro, Inc. to the City that the project will not be viable without public participation. The City, through this document, will be establishing Tax Increment Financing District No. 1-1 and also Municipal Development District No. 1. The Municipal Development District boundaries will be coterminous with the corporate boundaries of the City Oak Park Heights and are described in Exhibit I. Section 1.03 Exhibit Reference/Description Exhibit I This is a map that describes the boundaries of the Development District in which the Tax Increment Financing District will be established. Exhibit IA This is a map that describes the boundaries of the Tax Increment Financing District in which the project(s) generating the tax increment will be located. Exhibit IB This is a property description that describes the property to be included within the boundaries of the TIF district. Exhibit II This is a sources and uses statement that line items the anticipated revenue sources for the project and the anticipated expenditures for those revenues. Exhibit III This report shows the various project and district assumptions for the tax increment financing district including applicable dates, original tax capacity information, projected project valuation, buildout, and various required elections. Exhibit IV This report shows the projected cash flow of the tax increment over a specified period of time. It reflects calculations used to determine “net” tax increment including various additions and deductions. Exhibit V This report shows the estimated impact on the respective taxing jurisdictions if the captured tax capacity was available immediately to the taxing jurisdictions (See Section 4.22). It also shows a comparative market value analysis of the property both with and without the establishment of the TIF district. (See Section 4.09(2)). Article II – Statement of Public Purpose and Authority City of Oak Park Heights, Minnesota 3 Section 2.01 Statement of Need and Public Purpose The City Council of the City has determined that there is a need for the City to take certain actions designed to encourage, ensure and facilitate development and redevelopment by the private sector of underutilized, and unused land located within the corporate limits of the City in order to provide additional employment opportunities for residents of the City and the surrounding area; to improve the tax base of the City, the County and Independent School District No. 834 (the “school district”), thereby enabling them to better utilize existing public facilities and provide needed public services; and to improve the general economy of the City, the County and the State. Specifically, the City Council has determined that the property within the Development District is either underutilized or unused due to a variety of factors, including inadequate public improvements to serve the property; which has resulted in a lack of private investment; that, as a result, the property is not providing adequate employment opportunities, and is not contributing to the tax base and general economy of the City, the School District, the County and the State to its full potential; and, therefore, that it is necessary for the City to exercise its Authority under the Development District Act and the Tax Increment Financing Act to develop, implement and finance a program designed to encourage, ensure and facilitate the commercial development and redevelopment of the property located in the Development District, to further and accomplish the public purposes specified in this paragraph. The development proposed for the Development District would not occur solely through private investment in the foreseeable future; the Tax Increment Financing Plan will afford maximum opportunity, consistent with the sound needs of the City as a whole, for the development or redevelopment of the property to be located in the Development District by private enterprise. The welfare of the City, the County and the State of Minnesota requires active promotion, attraction, encouragement and development of economically sound industry and commerce by the City. Section 2.02 Statutory Authorization The Development District Act authorizes the City, upon certain public purpose findings by the City Council, to establish and designate development districts within the City and to establish, develop and administer development programs therefor to meet the needs and accomplish the public purposes specified in Section 2.01. In accordance with the purposes set forth in Section 469.124 of the Development District Act, the City Council has established the Development District comprising the area described on the attached Exhibit I, IA, and IB and has adopted this Development Program therefor. The TIF Act authorizes the City, upon certain findings by the City Council, to establish and designate tax increment financing districts within the Development District and to adopt and implement a tax increment financing plan to accomplish the Development Program established for the Development District. In accordance with the Tax Increment Financing Act, the City has established Tax Increment Financing District No. 1-1 in the Development District as a renewal and renovation district described in Section 469.174 subdivision 10a, and has adopted therefor the Tax Increment Financing Plan set forth in Article IV hereof, which provides for the use of tax increment financing to finance the costs of qualified public activities and improvements in the Development District, as specified in the Development Program and the Tax Increment Financing Plan. Article III – Development Program DEVELOPMENT PROGRAM Section 3.01 Statement of Objectives The establishment of the Development District in the City pursuant to the Development District Act, is necessary and in the best interests of the City and its residents and is necessary to give the City the ability to meet certain public purpose objectives that would not be obtainable in the foreseeable future without intervention by the City in the normal development process. The City intends, to the extent permitted by law, to accomplish the following objectives through the implementation of the Development Program: (1) Provide for the acquisition of land and construction and financing of the Site Improvements in the Development District which are necessary for the orderly and beneficial development of the Development District and adjacent areas of the City. (2) Promote and secure the prompt and unified development of certain property in the Development District, such property is not now in productive use or in its highest and best use, with a minimum adverse impact on the environment, and thereby promote and secure the desirable development of other land in the City. (3) Promote and secure additional employment opportunities within the Development District and the City for residents of the City and the surrounding area, thereby improving living standards and reducing unemployment and the loss of skilled and unskilled labor and other human resources in the City. (4) Secure the increase of assessed values of property subject to taxation by the City, the County, the Independent School District No. 834, the County, and other taxing jurisdictions in order to better enable such entities to pay for governmental services and programs that they are required to provide. (5) Promote the concentration of new unified development consisting of desirable industrial and other appropriate development in the Development District so as to maintain the area in a manner compatible with its accessibility and prominence in the City. (6) Encourage the expansion and improvement of local business, economic activity and development, whenever possible. (7) Create a desirable and unique character within the Development District through quality land use alternatives and design quality in new buildings. (8) Encourage and provide assistance for residential development, including single and multifamily housing accommodations for low and moderate income families. Section 3.02 Boundaries of the Development District The area within the Development District is described in the attached Exhibit I. City of Oak Park Heights, Minnesota 4 Article III – Development Program Section 3.03 Development Activities The City will perform or cause to be performed, to the extent permitted by law, all project activities pursuant to the Development District Act, the Tax Increment Financing Act and other applicable state laws. In doing so the City anticipates that the following may, but are not required, to be undertaken by the City: (1) The making of studies, planning and other formal and informal activities relating to the Development Program. (2) The implementation and administration of the Development Program. (3) The rezoning of land within the Development District. (4) The acquisition of property, or interests in property, by purchase or condemnation, when such acquisition is consistent with the objectives of the Development Program. (5) The preparation of property for use and development in accordance with applicable Land Use Regulations and the development agreement, including demolition of structures, clearance of sites, placement of fill and grading. (6) The resale of property to private parties. (7) The construction or reconstruction of site improvements described in Section 4.07 hereof. (8) The issuance of tax increment bonds to finance the Public Costs of the Development Program, and the use of tax increments, or other funds available to the City, to pay or finance the Public Costs of the Development Program incurred or to be incurred by it pursuant to the Development Agreement. (9) The use of tax increments to pay debt service on tax increment bonds or otherwise pay or reimburse with interest the Public Costs of the Development Program. Section 3.04 Payment of Public Costs It is anticipated that the Public Costs of the Development District will be paid primarily from proceeds of tax increment bonds or from tax increments. The City reserves the right to use other sources of revenue including, but not limited to, special assessments and user charges, which the City may apply to pay a portion of the Public Costs. Section 3.05 Environmental Controls; Land Use Regulations All municipal actions, public improvements and private development shall be carried out in a manner consistent with existing environmental controls and all applicable Land Use Regulations. Section 3.06 Park and Open Space to be Created Park and open space created within the Development District will be done so in accordance with the zoning and platting ordinances of the City. City of Oak Park Heights, Minnesota 5 Article III – Development Program City of Oak Park Heights, Minnesota 6 Section 3.07 Proposed Reuse of Property The Development Program contemplates that the City may acquire property and reconvey the same to another entity. Prior to formal consideration of the acquisition of any property, the City Council will require the execution of a binding development agreement with respect thereto and evidence that tax increments or other funds will be available to repay the Public Costs associated with the proposed acquisition. It is the intent of the City to negotiate the acquisition of property whenever possible. Appropriate restrictions regarding the reuse and redevelopment of property shall be incorporated into any development agreement to which the City is a party. Section 3.08 Administration and Maintenance Maintenance and operation of the Development District will be the responsibility of the City Administrator who shall serve as administrator of the Development District. Each year the administrator will submit to the City Council the maintenance and operating budget for the following year. The administrator will administer the Development District pursuant to the provisions of Section 469.131 of the Development District Act; provided, however, that such powers may only be exercised at the direction of the City Council. No action taken by the administrator pursuant to the above-mentioned powers shall be effective without authorization by the City Council. Section 3.09 Relocation Any person or business that is displaced as a result of the Development Program will be relocated in accordance with Minnesota Statutes, Sections 117.50 to 117.56. The City accepts its responsibility for providing such relocation assistance pursuant to Section 469.133 of the Development District Act. Section 3.10 Amendments The City reserves the right to alter and amend the Development Program, and the Tax Increment Financing Plans, subject to the provisions of state law regulating such action. The City specifically reserves the right to enlarge or reduce the size of the Development District and the Tax Increment Financing District, the Development Program and the Public Costs of the Development Program and the amount of Tax Increment Bonds to be issued to finance such costs by following the procedures specified in Minnesota Statutes, Section 469.175, Subdivision 4. Section 3.11 Estimates of Public Costs and Budget The eligible costs to be reimbursed by the City, in carrying out the Development Program, are described in Exhibit II of the Tax Increment Financing Plan. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 7 TAX INCREMENT FINANCING PLAN Section 4.01 Statement of Need and Public Purpose See Section 2.01 of the Statement of Public Purpose and Authority. Section 4.02 Statutory Authorization See Section 2.02 of the Statement of Public Purpose and Authority. Section 4.03 Statement of Objectives See Section 3.01 of the Development Program for the Development District. Section 4.04 Renewal and Renovation District Designation Renewal and Renovation districts are a type of tax increment financing district consisting of a project, or portions of a project, within which the authority finds by resolution that: (1) parcels comprising at least 70% of the area of the district are occupied by buildings, streets, utilities, paved or gravel parking lots, or other improvements, and more than 20% of the buildings (not including outbuildings) are structurally substandard, and 30 percent of the other buildings require substantial renovation or clearance to remove existing conditions such as: inadequate street layout, incompatible uses or land use relationships, overcrowding of buildings on the land, excessive dwelling unit density, obsolete buildings not suitable for improvement or conversion, or other identified hazards to the health, safety, and general well-being of the community; A parcel is deemed "occupied" if at least 15% of the area of the parcel contains buildings, streets, utilities, paved or gravel parking lots, or other similar structures; and (2) the conditions described in clause (1) are reasonably distributed throughout the geographic area of the district. For districts consisting of two or more noncontiguous areas, each area must individually qualify under the provisions listed above, as well as the entire area must also qualify as a whole. The TIF District qualifies as a renewal and renovation district in that it meets all of the criteria listed in (1) and (2) above. The supporting facts and documentation for this determination will be retained by the City for the life of the TIF District and are available to the public upon request. "Structurally substandard" is defined as buildings containing defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance. A building is not structurally substandard if it is in compliance with the building code applicable to a new building, or could be modified to satisfy the existing code at a cost of less than 15% of the cost of constructing a new structure of the same square footage and type on the site. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 8 The municipality may find that a building is not disqualified as structurally substandard under the preceding sentence on the basis of reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or structural repairs, or other similar reliable evidence. The municipality may not make such a determination without an interior inspection of the property, but need not have an independent, expert appraisal prepared of the cost of repair and rehabilitation of the building. An interior inspection of the property is not required, if the municipality finds that (1) the municipality or authority is unable to gain access to the property after using its best efforts to obtain permission from the party that owns or controls the property; and (2) the evidence otherwise supports a reasonable conclusion that the building is structurally substandard. Items of evidence that support such a conclusion include recent fire or police inspections, on-site property tax appraisals or housing inspections, exterior evidence of deterioration, or other similar reliable evidence. Written documentation of the findings and reasons why an interior inspection was not conducted must be made and retained by the City. Failure of a building to be disqualified under the provisions of this paragraph is a necessary, but not a sufficient, condition to determining that the building is substandard. A parcel is deemed to be occupied by a structurally substandard building if the following conditions are met: (1) the parcel was occupied by a substandard building within a three-year period prior to the parcel’s inclusion in the district and request for certification from the County Auditor; and (2) if the substandard building was demolished or removed within the three year period, such demolition or removal was performed or financed by the City, or was performed by a developer under a development agreement with the City. In addition, the City must have found by resolution before such demolition or removal occurred that the building was structurally substandard and that the City intended to include the parcel in the TIF District. In the case of (2) above, the County Auditor shall certify the original net tax capacity of the parcel to be the greater of (a) the current tax capacity of the parcel, or (b) a computed tax capacity of the parcel using the estimated market value of the parcel for the year in which the demolition or removal occurred, and the appropriate classification rate(s) for the current year. At least 90 percent of the tax increment from a redevelopment district or renewal and renovation district must be used to finance the cost of correcting conditions that allow designation as a redevelopment district. These costs include, but are not limited to, acquiring properties containing structurally substandard buildings or improvements or hazardous substances, acquiring adjacent parcels necessary to provide a site of sufficient size to permit development, demolition and rehabilitation of structures, clearing of land, removal of hazardous substances, and installation of utilities, roads, sidewalks, and parking facilities for the site. The allocated administrative expenses of the City may be included in the qualifying costs. Section 4.05 Duration of the TIF District Renewal and renovation districts may remain in existence 15 years from the date of receipt of the first tax increment. Modifications of this plan shall not extend this limitation. The City reserves the right to allow the TIF District to remain in existence the maximum duration allowed by law (projected to be through the year 2026) but may decide to decertify the TIF District at an earlier date. All tax increments from taxes payable in the year the TIF District is decertified shall be paid to the City. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 9 Section 4.06 Specific Development Expected to Occur Within the TIF District See Exhibit IA & IB. The City intends to enter into a contract with Anchobaypro, Inc. regarding their proposal to develop two phases of housing within the City. The first is a 48-unit residential senior cooperative building that will be two stories in height and approximately 80,000 square feet in size. The second will be a 120-unit assisted living facility approximately 107,000 square feet in size. The construction is expected to be completed by late spring of 2011. This would result in the first tax increments being available in taxes payable 2011(partial based on 2009 completion). The benefits to the City include replacement of older housing stock, an addition of new housing units, including an assisted living facility and an increased future tax base. It has been stated, in writing, by Anchobaypro, Inc. to the City that the project will not be viable without public participation. The proposed development is within the TIF District boundaries described in Exhibit IA & IB. No contracts have been entered into for the proposed development at this time. The entire project should be 100% assessed and on the tax rolls as of January 2, 2012 for taxes payable in 2013. Section 4.07 Parcel(s) to be Included in the TIF District The property to be included in the TIF District includes all, or portions of, ten parcels within the City. The proposed boundaries of the TIF District are reflected on a map attached as Exhibit IA and include any potential or current parcel splits. It is intended that a final plat will be submitted to the City that reflects the proposed boundaries. The final plat will be approved by the City prior to the request for certification of the TIF district. The following parcel identification number(s) (PID#’s) and corresponding legal description(s), along with adjacent rights-of-way, will be included in the TIF District: See Exhibit IB for the PID#’s and legal description of the parcels. Section 4.08 Property to be Acquired in the TIF District Anchobaypro, Inc. will be purchasing all of the parcels within the TIF district. None of the parcels are are owned by the City. The City reserves the right to reimburse the developer for TIF eligible costs as specified in Section 4.10 and Exhibit II. Section 4.09 Findings and Need for Tax Increment Financing Pursuant to Minnesota Statutes, the City makes the following findings in conjunction with the approval of this tax increment financing plan: (1) Tax Increment Financing District No. 1-1 is a renewal and renovation district as defined in Minnesota Statutes, Section 469.174, Subd. 10a. The reasons and supporting facts for this determination will be documented in writing and retained and made available to the public by the City until the district has been terminated. The determination is described in Section 4.04 of this TIF Plan. (2) The proposed development or redevelopment, in the opinion of the City, 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 the TIF District permitted by the TIF Plan; Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 10 The reasons supporting this finding are that: (i) This finding is supported by the fact that the redevelopment proposed in this TIF Plan meets the City's objectives for redevelopment. The District is currently occupied by residential housing, of which 50% has been designated substandard. Redevelopment will require demolition and site clearance. The high cost of acquisition of the site represents a substantial financial risk to Anchobaypro, Inc., which has represented to the City in writing that it would not be feasible to undertake the proposed redevelopment without tax increment financing assistance. The TIF is intended to mitigate the risk by providing assistance for land acquisition costs related to the property. Therefore, the City reasonably concludes that the proposed redevelopment of the District (including both phases of housing) is not financially feasible or likely to occur in the foreseeable future without the assistance described in this Plan. (ii) This finding is based on the fact that the land in the District is now fully developed, with a substandard use. Any increase in market value without tax increment assistance would only occur if the existing owners made substantial improvements, or sold their property for redevelopment through large-scale improvements similar to those proposed in this Plan. The City has evidence to support the expectation that the existing owners will not make improvements on their own. Further, there has been little interest in comprehensive redevelopment in this area without public intervention. Therefore, the City reasonably determines that no other redevelopment of similar scope is anticipated on this site without substantially similar assistance being provided to the development. The above findings are stated in monetary terms in Exhibit V, which can be summarized as follows: a. The City's estimate of the amount by which the market value of the site will increase without the use of tax increment financing is $0 (for the reasons described above). b. If all development which is proposed to be assisted with tax increment were to occur in the District, the total increase in market value would be up to $18,300,700. 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 $1,675,401. 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 $16,625,299 (the amount in clause b less the amount in clause c) without tax increment assistance. (3) The Tax Increment Financing Plan for Tax Increment Financing District No. 1-1 conforms to the general plan for development or redevelopment of the City of Oak Park Heights as a whole. The reasons for supporting this finding are that: a. Tax Increment Financing District No. 1-1 is properly zoned; and b. The Tax Increment Financing Plan will generally compliment and serve to implement policies adopted in the City's comprehensive plan. The TIF Plan has been Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 11 adopted by the City Planning Commission after review and making the determination that the TIF Plan complies with the City’s comprehensive plan. (4) The Tax Increment Financing Plan will afford maximum opportunity, consistent with the sound needs of the City of Oak Park Heights as a whole, for the development or redevelopment of Municipal Development District No. 1, as modified, by private enterprise. The reasons supporting this finding are that: The project to be assisted by the District will result in the preservation and enhancement of the tax base and the redevelopment of a substandard area, and will provide employment opportunities in the City. Section 4.10 Estimated Sources of Revenue/Public Costs The estimated sources of revenue, along with the estimated public costs of the TIF District, are itemized and attached as Exhibit II. Such costs are eligible for reimbursement from tax increments, and other listed sources of revenue from the TIF District. The City reserves the right to administratively adjust the amount of any of the items in Exhibit II or to incorporate additional eligible items, so long as the total estimated public cost (uses) is not increased. The City anticipates providing financial assistance to the proposed development through the use of a pay- as-you-go technique. As tax increments are collected from the TIF District in future years, a portion of these taxes will be reimbursed to the developer for TIF eligible costs. The City reserves the right to finance any or all public costs of the TIF District using pay-as-you-go assistance, internal funding, general obligation or revenue debt, or any other financing mechanism authorized by law. The City also reserves the right to use other sources of revenue legally applicable to the Project Area to pay for such costs including, but not limited to, special assessments, utility revenues, federal or state funds, and investment income. Section 4.11 Estimated Amount of Bonded Indebtedness The City does not anticipate issuing tax increment bonds to finance the estimated public costs of the TIF District, but reserves the right to issue such bonds in an amount not to exceed $1,927,000. Section 4.12 Original Net Tax Capacity Upon or after adoption of the tax increment plan, the County Auditor, upon request of the City, shall certify the original net tax capacity of the TIF District. This value will be equal to the total net tax capacity of all property in the TIF District as certified by the Commissioner of Revenue plus any amount determined under M.S. Section 469.177 subd. 4. 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. For projection puroposes, this will be based on the Estimated Market Value of all property within the TIF District as of January 2, 2009, for taxes payable in 2010 which is currently $1,299,300. Upon establishment of the TIF District it is estimated that the original net tax capacity of the TIF District will be approximately $15,481. Reclassification and/or replatting of property will be incorporated into this calculation. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 12 As per M.S. Section 469.177, subd.1, each year the County Auditor shall certify the amount that the original net tax capacity has increased or decreased as a result of, including but not limited to: (1) changes in the tax-exempt status of property; (2) reductions or enlargements of the geographic area of the TIF District; (3) changes due to stipulation agreements or abatements; or (4) changes in property classification rates. Section 4.13 Original Tax Capacity Rate At the time of the initial certification of the original net tax capacity for the tax increment financing district, the County Auditor shall certify the original local tax capacity rate that applies to the TIF District. This is the sum of all the local tax rates that apply to the property in the TIF District. This rate certified is the rate in effect for the same taxes payable year as the certified original net tax capacity. The tax generated by the extension of the lesser of (a) the local taxing district tax rates or (b) the original local tax capacity rate, to the retained captured net tax capacity of the TIF District is the tax increment. The sum of all local tax rates that apply to property in the TIF District, for taxes levied in 2008 and payable in 2009, is 86.432%. The County Auditor shall certify this amount as the original tax capacity rate of the TIF District. For purposes of estimating the tax increment generated by the TIF District, the sum of the local tax rates for taxes levied in 2008 and payable in 2009, is 87.312% as shown below: 2008/2009 Taxing Jurisdiction Local Tax Rate City of Oak Park Heights 38.732% Washington County 26.371% Independent School District No. 834 17.714% Other 3.615% ________ Total 86.432% Section 4.14 Projected Retained Captured Net Tax Capacity and Projected Tax Increment Each year the County Auditor shall determine the current net tax capacity of all property in the TIF District. To the extent that this total exceeds the original net tax capacity, the difference shall be known as the captured net tax capacity of the TIF District. The County Auditor shall certify to the City the amount of captured net tax capacity each year. The City may choose to retain any or all of this amount. It is the City's intention to retain 100% of the captured net tax capacity of the TIF District. Such amount shall be known as the retained captured net tax capacity of the TIF District. Exhibit III gives a listing of the various information and assumptions used in preparing a number of the exhibits contained in this TIF Plan, including Exhibit IV, which shows the projected tax increment generated over the anticipated life of the TIF District. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 13 Section 4.15 Use of Tax Increment Each year the County Treasurer shall deduct 0.36% of the annual tax increment generated by the TIF District and pay such amount to the State's General Fund. Such amounts will be appropriated to the State Auditor for the cost of financial reporting and auditing of tax increment financing information throughout the state. Exhibit IV shows the projected deduction for this purpose over the anticipated life of the TIF District. The City has determined that it will use the remaining tax increment generated by the portion of the captured net tax capacity specified above (See Section 4.14) for any of the following purposes: (1) pay for the estimated public costs of the TIF District (see Section 4.10) and County administrative costs associated with the TIF District (see Section 4.20); (2) pay principal and interest on tax increment bonds or other bonds issued to finance the estimated public costs of the TIF District; (3) accumulate a reserve securing the payment of tax increment bonds or other bonds issued to finance the estimated public costs of the TIF District; (4) pay all or a portion of the county road costs as may be required by the County Board under M.S. Section 469.175, Subdivision 1a (see Section 4.17); or (5) return excess tax increments to the County Auditor for redistribution to the City, County and School District. Tax increments from property located in one county must be expended for the direct and primary benefit of a project located within that county, unless both county boards involved waive this requirement. Tax increments shall not be used to circumvent levy limitations applicable to the City. Tax increment shall not be used to finance the acquisition, construction, renovation, operation, or maintenance of a building to be used primarily and regularly for conducting the business of a municipality, county, school district, or any other local unit of government or the State or federal government, or for a commons area used as a public park, or a facility used for social, recreational or conference purposes. This prohibition does not apply to the construction or renovation of a parking structure, or a privately owned facility for conference purposes. If there exists any type of agreement or arrangement providing for the developer, or other beneficiary of assistance, to repay all or a portion of the assistance that was paid or financed with tax increments, such payments shall be subject to all of the restrictions imposed on the use of tax increments. Assistance includes sale of property at less than the cost of acquisition or fair market value, grants, ground or other leases at less then fair market rent, interest rate subsidies, utility service connections, roads, or other similar assistance that would otherwise be paid for by the developer or beneficiary. Section 4.16 Excess Tax Increment In any year in which the tax increments from the TIF District exceed the amount necessary to pay the estimated public costs authorized by the TIF Plan, the City shall use the excess tax increments to: (1) prepay any outstanding tax increment bonds; (2) discharge the pledge of tax increments thereof; Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 14 (3) pay amounts into an escrow account dedicated to the payment of the tax increment bonds; or (4) return excess tax increments to the County Auditor for redistribution to the City, County and School District. The County Auditor must report to the Commissioner of Education the amount of any excess tax increment redistributed to the School District within 30 days of such redistribution. Section 4.17 County Road Costs The County Board may require the City to pay all, or a portion of, the cost of county road improvements out of increment revenues, if the following conditions occur: (1) the proposed development will, in the judgment of the county, substantially increase the use of county roads requiring construction of road improvements or other road costs; and (2) the road improvement or other road costs are not scheduled for construction within five years under the county capital improvement plan, or another formally adopted county plan and in the opinion of the county, would not reasonably be expected to be needed within the reasonably foreseeable future if the TIF plan were not implemented. If the county elects to use tax increments to finance the road improvements, the county must notify the City and municipality within 45 days after receipt of the proposed TIF plan under subdivision 2 and the county and municipality must comply with the terms in M.S. Section 469.175, subd. 2(b). Section 4.18 Four-Year Rule - Limitation on Property Not Subject to Improvements If after four years from certification of the TIF District no demolition, rehabilitation, renovation or site improvement, including a qualified improvement of an adjacent street, has commenced on a parcel located within the TIF District, then that parcel shall be excluded from the TIF District and the original net tax capacity shall be adjusted accordingly. Qualified improvements of a street are limited to construction or opening of a new street, relocation of a street, or substantial reconstruction or rebuilding of an existing street. The City must submit to the County Auditor, by February 1 of the fifth year, evidence that the required activity has taken place for each parcel in the TIF District. If a parcel is excluded from the TIF District and the City or owner of the parcel subsequently commences any of the above activities, the City shall certify to the County Auditor that such activity has commenced and the parcel shall once again be included in the TIF District. The County Auditor shall certify the net tax capacity of the parcel, as most recently certified by the Commissioner of Revenue, and add such amount to the original net tax capacity of the TIF District. Section 4.19 Five-Year Rule - Tax Increment Pooling 90% of the tax increments (net of administrative expenses) from the TIF District must be expended on activities within the district or to pay for bonds used to finance the estimated public costs of the TIF District (see Section 4.04 for additional restrictions). All administrative expenses are considered to have been spent outside of the TIF District. Tax increments are considered to have been spent within the TIF District if such amounts are: (1) actually paid to a third party for activities performed within the TIF District within five years after certification of the district; (2) used to pay bonds that were issued and sold to a third party, the proceeds of which are reasonably expected on the date of issuance to be spent within the later of the five-year Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 15 period or a reasonable temporary period or are deposited in a reasonably required reserve or replacement fund. (3) used to make payments or reimbursements to a third party under binding contracts for activities performed within the TIF District, which were entered into within five years after certification of the district; or (4) used to reimburse a party for payment of eligible costs (including interest) incurred within five years from certification of the district; or (5) in the case of a housing district, used for a housing project, as defined in section 469.174, subdivision 11. Beginning with the sixth year following certification of the TIF District, at 100% of the tax increments must be used to pay outstanding bonds or make contractual payments obligated within the first five years. When outstanding bonds have been defeased and sufficient money has been set aside to pay for such contractual obligations, the TIF District must be decertified. The City may also elect to increase by up to ten percentage points the permitted amount of expenditures for activities located outside of the geographic area of the district. As permitted by M.S. Section 469.176, subdivision 4k, the expenditures, including the prior permitted expenditures, need not be made within the geographic area of the project if the expenditures: (1) are used exclusively to assist housing that meets the requirement for a qualified low- income building, as that term is used in Section 42 of the Internal Revenue Code; (2) do not exceed the qualified basis of the housing, as defined under Section 42 (c) of the Internal Revenue Code, less the amount of any credit allowed under Section 42 of the Internal Revenue Code; and (3) be used to: a) acquire and prepare the site of the housing; b) acquire, construct, or rehabilitate the housing; or c) make public improvements directly related to the housing. Section 4.20 Limitation on Administrative Expenses Administrative expenses are defined as all costs of the City other than: (1) amounts paid for the purchase of land; (2) amounts paid for materials and services, including architectural and engineering services directly connected with the proposed development within the TIF District; (3) relocation benefits paid to, or services provided for, persons or businesses residing or located within the TIF District; or (4) amounts used to pay interest on, fund a reserve for, or sell at a discount, tax increment bonds. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 16 Administrative expenses include amounts paid for services provided by bond counsel, fiscal consultants, planning or economic development consultants, and actual costs incurred by the County in administering the TIF District. Tax increments may be used to pay administrative expenses of the TIF District up to the lesser of (a) 10% of the total estimated tax increment expenditures authorized by the TIF Plan or (b) 10% of the total tax increments from the district. Section 4.21 Estimated Impact on Other Taxing Jurisdictions The City believes that, because the development would not have occurred without the tax increment assistance, TIF District No. 1-1 has no impact on other taxing jurisdictions. However, assuming the development would have occurred without tax increment assistance, making the anticipated captured tax capacity available to other jurisdictions, the hypothetical impacts on other jurisdictions are presented in Exhibit V. A positive impact on other taxing jurisdictions will occur when the TIF District is decertified and the development therein becomes part of the general tax base. Additional fiscal and economic impacts of TIF District No. 1-1, pursuant to Section 469.175, subd. 2 of the TIF Act, are listed below. 1. The total amount of tax increment that will be generated over the life of the district is estimated to be $2,897,237. 2. The probable impact of the district on city-provided services such as police and fire protection, public infrastructure, and the impact of any general obligation tax increment bonds attributable to the district upon the ability to issue other debt for general fund purposes, is minimal. Likewise, residential housing developed in recent years has not created a substantial increase in service calls from police. Public infrastructure costs, such as traffic impacts, water and sewer usage, and street maintenance, are estimated to increase at a reasonable rate, as compared with the TIF District’s previous residential use. The City does not plan to issue general obligation tax increment bonds, and therefore there should be no effect on the ability of the City to issue other bonds. Therefore, there will be no impact of any general obligation tax increment bonds attributable to the district upon the ability to issue other debt for general fund purposes. 3. 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 estimated to be $593,781. 4. The amount of tax increment 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 estimated to be $883,967. 5. Neither the County nor the School District have requested additional information regarding size, timing, or type of development in the TIF District. If the City receives such a request, the City will provide the information requested. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 17 Section 4.22 Prior Planned Improvements The City shall accompany its request for certification to the County Auditor (or notice of district enlargement), with a listing of all properties within the TIF District for which building permits have been issued during the 18 months immediately preceding approval of the TIF Plan. The County Auditor shall increase the original net tax capacity of the TIF District by the net tax capacity of each improvement for which a building permit was issued. There have been no building permits issued in the last 18 months in conjunction with any of the properties within the TIF District. Section 4.23 Development Agreements No more than 10%, by acreage, of the property to be acquired within a project containing a housing district may be purchased by the City with the proceeds of bonds issued pursuant to M.S. 469.178 to which tax increment from the property being acquired is pledged unless prior to acquisition the City has entered into an agreement for development which provides recourse for the property should the development or redevelopment not be completed. The City intends to enter into an agreement for development. Section 4.24 Assessment Agreements The City may, upon entering into a development agreement, also enter into an assessment agreement with the developer, which establishes a minimum market value of the land and improvements for each year during the life of the TIF District. The assessment agreement shall be presented to the County or City Assessor who shall review the plans and specifications for the improvements to be constructed, review the market value previously assigned to the land, and so long as the minimum market value contained in the assessment agreement appears to be an accurate estimate, shall certify the assessment agreement as reasonable. The assessment agreement shall be filed for record in the office of the County Recorder of each county where the property is located. Any modification or premature termination of this agreement must first be approved by the City, County and School District. The City does not intend to enter into an assessment agreement. Section 4.25 Modifications of the Tax Increment Financing Plan Any reduction or enlargement in the geographic area of the Project Area or the TIF District; increase in the amount of bonded indebtedness to be incurred; increase in the amount of capitalized interest; increase in that portion of the captured net tax capacity to be retained by the City; increase in the total estimated public costs; or designation of additional property to be acquired by the City shall be approved only after satisfying all the necessary requirements for approval of the original TIF Plan. This paragraph does not apply if: (1) the only modification is elimination of parcels from the TIF District; and (2) the current net tax capacity of the parcels eliminated equals or exceeds the net tax capacity of those parcels in the TIF District's original net tax capacity, or the City agrees that the TIF District's original net tax capacity will be reduced by no more than the current net tax capacity of the parcels eliminated. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 18 The City must notify the County Auditor of any modification that reduces or enlarges the geographic area of the TIF District. The geographic area of the TIF District may be reduced but not enlarged after five years following the date of certification. Section 4.26 Administration of the Tax Increment Financing Plan Upon adoption of the TIF Plan, the City shall submit a copy of such plan to the Minnesota Department of Revenue and the Office of the State Auditor. The City shall also request that the County Auditor certify the original net tax capacity and net tax capacity rate of the TIF District. To assist the County Auditor in this process, the City shall submit copies of the TIF Plan, the resolution establishing the TIF District and adopting the TIF Plan, and a listing of any prior planned improvements. The City shall also send the County Assessor any assessment agreement establishing the minimum market value of land and improvements in the TIF District, and shall request that the County Assessor review and certify this assessment agreement as reasonable. The County shall distribute to the City the amount of tax increment as it becomes available. The amount of tax increment in any year represents the applicable property taxes generated by the retained captured net tax capacity of the TIF District. The amount of tax increment may change due to development anticipated by the TIF Plan, other development, inflation of property values, or changes in property classification rates or formulas. In administering and implementing the TIF Plan, the following actions should occur on an annual basis: (1) prior to December 31, the City shall notify the County Assessor of any new development that has occurred in the TIF District during the past year to insure that the new value will be recorded in a timely manner. (2) if the County Auditor receives the request for certification of a new TIF District, or for modification of an existing TIF District, before July 1, the request shall be recognized in determining local tax rates for the current and subsequent levy years. Requests received on or after July 1 shall be used to determine local tax rates in subsequent years. (3) as per M.S. Section 469.177, subd.1, each year the County Auditor shall certify the amount of the original net tax capacity of the TIF District. The amount certified shall reflect any changes that occur as a result of the following, including but not limited to: a) the value of property that changes from tax-exempt to taxable shall be added to the original net tax capacity of the TIF District. The reverse shall also apply; b) the original net tax capacity may be modified by any approved enlargement or reduction of the TIF District; c) if laws governing the classification of real property cause changes to the percentage of taxable market value to be applied for property tax purposes, then the resulting increase or decrease in net tax capacity shall be applied proportionately to the original net tax capacity and the retained captured net tax capacity of the TIF District. The County Auditor shall notify the City of all changes made to the original net tax capacity of the TIF District. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 19 Section 4.27 Financial Reporting and Disclosure Requirements The State Auditor shall enforce the provisions of the TIF Act and shall have full responsibility for financial and compliance auditing of the City's use of tax increment financing. On or before August 1 of each year, the City must annually submit to the State Auditor, County Auditor and to the governing body of the municipality a report which shall: (1) provide full disclosure of the sources and uses of public funds in the TIF District; (2) permit comparison and reconciliation of the accounts and financial reports; (3) permit auditing of the funds expended on behalf of the TIF District; and (4) be consistent with generally accepted accounting principles. The report shall include, among other items, the following information: (1) the original net tax capacity of the district and any subdistrict under 469.177, subdivision 1; (2) the net tax capacity for the reporting period of the district and any subdistrict; (3) the captured net tax capacity of the district; (4) any fiscal disparity deduction from the captured net tax capacity under section 469.177, subdivision 3; (5) the captured net tax capacity retained for tax increment financing under 469.177, subdivision 2, paragraph (a), clause (1); (6) any captured net tax capacity distributed among affected taxing districts under 469.177, subdivision 2, paragraph (a), clause (2); (7) the type of district; (8) the date the municipality approved the tax increment financing plan and the date of approval of any modification of the tax increment financing plan, the approval of which requires notice, discussion, a public hearing, and findings under subdivision 4, paragraph (a); (9) the date the City first requested certification of the original net tax capacity of the district and the date of request for certification regarding any parcel added to the district; (10) the date the county auditor first certified the original net tax capacity of the district and the date of certification of the original net tax capacity of any parcel added to the district; (11) the month and year in which the City has received or anticipates it will receive the first increment from the district; (12) the date the district must be decertified; (13) for the reporting period and prior years of the district, the actual amount received from, at least, the following categories: Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 20 a) tax increments paid by the captured net tax capacity retained for tax increment financing under section 469.177, subdivision 2, paragraph (a), clause (1), but excluding any excess taxes; b) tax increments that are interest or other investment earnings on or from tax increments; c) tax increments that are proceeds from the sale or lease of property, tangible or intangible, purchased by the City with tax increments; d) tax increments that are repayments of loans or other advances made by the City with tax increments; e) bond or loan proceeds; f) special assessments; g) grants; h) transfers from funds not exclusively associated with the district; and i) the market value homestead credit paid to the City under M.S. Section 273.1384; (14) for the reporting period and for the prior years of the district, the amount budgeted under the tax increment financing plan, and the actual amount expended for, at least, the following categories: a) acquisition of land and buildings through condemnation or purchase; b) site improvements or preparation costs; c) installation of public utilities, parking facilities, streets, roads, sidewalks, or other similar public improvements; d) administrative costs, including the allocated cost of the City; and e) public park facilities, facilities for social, recreational, or conference purposes, or other similar public improvements; and f) transfers to funds not exclusively associated with the district; (15) the amount of any payments for activities and improvements located outside of the district that are paid for or financed with tax increments; (16) the amount of payments of principal and interest that are made during the reporting period on any non-defeased: a) general obligation tax increment financing bonds; b) other tax increment financing bonds; and c) notes and pay-as-you-go contracts; (17) the principal amount, at the end of the reporting period, of any non-defeased: Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 21 a) general obligation tax increment financing bonds; b) other tax increment financing bonds; and c) notes and pay-as-you-go contracts; (18) the amount of principal and interest payments that are due for the current calendar year on any non-defeased: a) general obligation tax increment financing bonds; b) other tax increment financing bonds; and c) notes and pay-as-you-go contracts; (19) if the fiscal disparities contribution under chapter 276A or 473F for the district is computed under section 469.177, subdivision 3, paragraph (a). the amount of increased property taxes imposed on other properties in the municipality that approved the tax increment financing plan as a result of the fiscal disparities contribution; (20) the estimate, if any, contained in the tax increment financing plan of the amount of the cost of the project, including administrative expenses, that will be paid or financed with tax increment; (21) any additional information the state auditor may require. The City must also annually publish in a newspaper of general circulation in the City an annual statement for each tax increment financing district showing: (1) the original net tax capacity of the district and any subdistrict under 469.177, subdivision 1; (2) the net tax capacity for the reporting period of the district and any subdistrict; (3) the captured net tax capacity of the district; (4) the month and year in which the City has received or anticipates it will receive the first increment from the district; (5) the date the district must be decertified; (6) the amount of principal and interest payments that are due for the current calendar year on any non-defeased obligations; (7) if the fiscal disparities contribution under chapter 276A or 473F for the district is computed under section 469.177, subdivision 3, paragraph (a). the amount of increased property taxes imposed on other properties in the municipality that approved the tax increment financing plan as a result of the fiscal disparities contribution; (8) the amounts of tax increment received and expended in the reporting period; (9) and any additional information the City deems necessary. Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 22 The annual statement must inform readers that additional information regarding each district may be obtained from the City, and must explain how the additional information may be requested. The City must publish the annual statement for a year no later than August 15 of the next year. The City must identify the newspaper of general circulation in the municipality to which the annual statement has been or will be submitted for publication and provide a copy of the annual statement to the county board, county auditor, the school board, the state auditor, and the governing body of the municipality on or before August 1 of the year in which the statement must be published. The reporting and disclosure requirements outlined in this section shall begin with the year the district was certified, and shall end in the year in which both the district has been decertified and all tax increments have been spent or returned to the county for redistribution. Failure to meet these requirements, as determined by the State Auditors Office, may result in suspension of distribution of tax increment. Section 4.28 Business Subsidy Compliance The City, or other local government agency, must comply with the business subsidies law when providing business subsidies to private entities. The requirements are specified in Minnesota Statutes, Sections 116J.993 to 116J.995. The City must adopt business subsidy criteria prior to granting a business subsidy. The requirements include: (1) the grantor must adopt the criteria following a public hearing; (2) the criteria may not be adopted on a case-by-case basis; (3) the criteria must set specific minimum requirements that recipients must meet in order to be eligible to receive business subsidies; (4) the criteria must include a specific wage floor for the wages to be paid for the jobs created. The wage floor may be stated as a specific dollar amount or a formula that will generate a specific dollar amount (5) a grantor may deviate from its criteria by documenting in writing the reason for deviation and attaching a copy of the document to its next annual report to the Department of Employment and Economic Development; (6) a copy of the criteria must be submitted to the Department of Employment and Economic Development. In addition, the City must enter into a subsidy agreement with the recipient of the subsidy. For subsidies greater than $150,000 the grantor must provide public notice and a hearing on the subsidy. The subsidy agreement must include: (1) a description of the subsidy, including the amount and type of subsidy, and type of district if the subsidy is tax increment financing; (2) a statement of the public purpose for the subsidy; (3) measurable, specific, and tangible goals for the subsidy; (4) a description of the financial obligation of the recipient if the goals are not met; (5) a statement of why the subsidy is needed; Article IV – Tax Increment Financing Plan City of Oak Park Heights, Minnesota 23 (6) a commitment to continue operations in the jurisdiction where the subsidy is used for at least five years after the benefit date; (7) the name and address of the parent corporation of the recipient, if any; and (8) a list of all financial assistance by all grantors for the project. The statute provides specific requirements in the event the subsidy agreement goals are not met by the recipient. Recipients are required to report to the grantor specific information as defined in statute. The grantor is also required, as specified in the statute, to report specific information annually to the Department of Employment and Economic Development. The City of Oak Park Heights has adopted a Business Subsidy Policy and intends to comply with the requirements of Minnesota Statutes 116J.993 to 116J.995. Because the intended subsidy for the project specified in this document is anticipated to be 100% for housing assistance it is exempt from the requirements of Minnesota Statutes 116J.993 to 116J.995. EXHIBIT I - Municipal Dev. District No. 1 The boundaries of Municipal Development District No. 1 are coterminous with the Oak Park Heights City limits. EXHIBIT IA - Tax Increment Financing District TIF DISTRICT NO. 1-1 Tax Increment Financing (Renewal and Renovation) District No. 1-1 EXHIBIT IB - Property Description Parcels reflecting the the following parcel identification number(s) (PID#’s) and corresponding legal description(s), along with adjacent rights-of-way, will be included in the TIF District: Parcel ID Number/Legal Description 05-029-20-11-0133 Block 1, Lot 2 SubdivisionCd 2633 SubdivisionName CARRIAGE HOUSE CO-OP AND ASSISTED LIVING 05-029-20-14-0153 Block 1, Lot 1 SubdivisionCd 2633 SubdivisionName CARRIAGE HOUSE CO-OP AND ASSISTED LIVING EXHIBIT II - Sources & Uses Statement Tax increment revenue 2,897,237 Interest on invested funds 0 Bond proceeds 0 Loan Proceeds 0 Real estate sales 0 Special assessments 0 Rent/lease revenue 0 Grants 0 Developer Equity 0 Transfers in 0 Total Sources of Funds 2,897,237 Land/building acquisition 1,200,000 Site improvements/preparation costs 0 Installation of public utilities 0 Parking facilities 0 Streets and sidewalks 0 Public park facilities 0 Social, recreational, conference facilities 0 Interest reduction payments 0 Bond principal payments 0 Bond interest payments 0 Loan principal payments 0 Loan/note interest payments 959,737 Administrative expenses 288,500 Capitalized Interest 150,000 Other (OSA)10,500 Transfers out (Pooling)288,500 Total Uses of Funds 2,897,237 Uses of Funds City of Oak Park Heights, MN Tax Increment Financing (Renewal and Renovation) District No. 1-1 Oakgreen Project Sources of Funds Northland Securities, Inc. - 2/16/2011 at 12:01 PM TIF 011511.xlsSource&Use EXHIBIT III - TIF District Assumptions Certification Request Date 07/01/09 Decertification Date 12/31/26 (16 Years of Increment) Present Value Date 07/01/09 Present Value Rate 6.00% Type of TIF District:Renewal and Renovation Type of Debt:Loan (Pay-as-you-go) Fiscal Disparities Election:NA Fiscal Disparities Rate:0.0000% Local Tax Capacity Rate: 86.432% 2008/2009 Administration:10.00% Pooling:10.00% Market Value Inflator:100.00% Base Value Information (*Prior to re-plat) 2009/2010 2009/2010 2009/2010 CLASS RATE CLASS RATE 2009/2010 Class PID # EMV 1st Tier 2nd Tier NTC RES 05-029-20-14-0003*175,100 1.00%1.25%1,999 RES 05-029-20-11-0063*119,400 1.00%1.25%1,303 REN 05-029-20-11-0062*100 1.25%1.25%1 REN 05-029-20-11-0059*219,200 1.25%1.25%2,740 REN 05-029-20-14-0136*100,000 1.25%1.25%1,250 RES 05-029-20-11-0026*182,300 1.00%1.25%2,089 RES 05-029-20-11-0065*177,300 1.00%1.25%2,026 REN 05-029-20-11-0028*168,000 1.25%1.25%2,100 REN 05-029-20-11-0064*28,600 1.25%1.25%358 REN 05-029-20-11-0117*129,300 1.25%1.25%1,616 Total 1,299,300 15,481 2010/2011 2011/2012 2012/2013 2013/2014 Base EMV Coop $654,100 $654,100 $654,100 $654,100 Base EMV Assisted $616,600 $616,600 $616,600 $616,600 Increase in EMV Coop 0 3,896,925 5,195,900 5,195,900 Increase in EMV Assisted 9,850,050 13,133,400 13,133,400 13,133,400 Total Estimated Market Value $11,120,750 $18,301,025 $19,600,000 $19,600,000 NTC Project 1 - 1st Tier RES 0 0 0 0 NTC Project 1 - 2nd Tier RES 0 38,969 51,959 51,959 NTC Project 2. - 1st Tier REN 0 0 0 0 NTC Project 2 - 2nd Tier REN 123,126 164,168 164,168 164,168 NTC Base 15,481 15,481 15,481 15,481 Total Net Tax Capacity $138,607 $218,618 $231,608 $231,608 City of Oak Park Heights, MN Tax Increment Financing (Renewal and Renovation) District No. 1-1 Oakgreen Project Northland Securities, Inc. - 2/16/2011 at 12:01 PM TIF 011511.xls - Assumptions EXHIBIT IV - Projected Tax Increment Cash FlowLess: Less: Retained AnnualSchoolLess: Less: Less:Annual Total Base Fiscal Captured Gross Tax City County District Other State Admin. Additional AnnualPeriod Net Tax Net Tax Disp. @ Net Tax Increment@@@@Aud. Ded. Retainage Pooling NetEnding Capacity Capacity 0.0000% Capacity 86.432% 38.732% 26.371% 17.714% 3.615%0.36%10.00% 10.00% Revenue12/31/2010 15,481 15,481 0000000000 012/31/2011 138,607 15,481 0 123,126 106,420 47,689 32,470 21,811 4,451 383 10,604 10,604 84,82912/31/2012 218,618 15,481 0 203,137 175,575 78,679 53,569 35,984 7,343 632 17,494 17,494 139,95512/31/2013 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2014 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2015 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2016 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2017 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2018 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2019 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2020 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2021 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2022 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2023 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2024 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2025 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2026 231,608 15,481 0 216,127 186,803 83,710 56,995 38,285 7,813 672 18,613 18,613 148,90512/31/2027 231,608 231,608 0000000000 012/31/2028 231,608 231,608 0000000000 012/31/2029 231,608 231,608 0000000000 012/31/2030 231,608 231,608 0000000000 012/31/2031 231,608 231,608 0000000000 012/31/2032 231,608 231,608 0000000000 012/31/2033 231,608 231,608 0000000000 012/31/2034 231,608 231,608 0000000000 012/31/2035 231,608 231,608 0000000000 012/31/2036 231,608 231,608 0000000000 012/31/2037 231,608 231,608 0000000000 012/31/2038 231,608 231,608 0000000000 02,897,237 1,298,313 883,967 593,781 121,176 10,423 288,680 288,680 2,309,454City of Oak Park Heights, MNTax Increment Financing (Renewal and Renovation) District No. 1-1Oakgreen ProjectNorthland Securities, Inc. - 2/16/2011 at 12:01 PMTIF 011511.xls - TaxIncAnn EXHIBIT V - Projected Tax Impact/Market Value Analysis City of Washington I.S.D. #834 Oak Park Heights County Stillwater Other Total Total Taxable NTC 2008/2009 8,921,360 295,173,120 87,614,826 NA 391,709,306 Projected Retained NTC 216,127 216,127 216,127 216,127 Hypothetical New NTC 9,137,487 295,389,247 87,830,953 NA Existing Local Tax Rate 2008/2009 38.732% 26.371% 17.714% 3.615%86.432% Hypothetical Adj. Local Tax Rate 37.816% 26.352% 17.670% 3.615% 85.453% Difference 0.916% 0.019% 0.044%NA 0.979% Hypothetical Taxes on Retained NTC 81,730 56,953 38,191 NA Statement 1: If the projected Retained Captured Net Tax Capacity of the TIF District was hypothetically available to each of the taxing jurisdictions above, the result would be a lower local tax rate (see Hypothetical Adjusted Tax Rate above) which would produce the same amount of taxes for each taxing jurisdiction. In such a case, the total local tax rate would decrease by 0.979% (see Hypothetical Adj. Local Tax Rate above). The hypothetical tax that the Retained Captured Net Tax Capacity of the TIF District would generate is also shown above. Statement 2: Since the projected Retained Captured Net Tax Capacity of the TIF District is not available to the taxing jurisdictions, then there is no impact on taxes levied or local tax rates. (1) Taxable net tax capacity = total net tax capacity - captured TIF - fiscal disparities contribution - powerline. (2) The impact on these taxing jurisdictions is negligible since they represent only 4.18% of the total tax rate. Annual Present Gross Tax Value @ Year Increment 6.00% 1 2011 106,420 93,344 2 2012 175,575 145,284 3 2013 186,803 145,826 4 2014 186,803 137,571 5 2015 186,803 129,784 Present Value Date 07/01/09 6 2016 186,803 122,438 Present Value Rate (Gross TIF) 6.00% 7 2017 186,803 115,508 8 2018 186,803 108,969 Increase in EMV With TIF District $18,300,700 9 2019 186,803 102,801 Less: P.V of Gross Tax Increment 1,675,401 10 2020 186,803 96,982 11 2021 186,803 91,493 Subtotal $16,625,299 12 2022 186,803 86,314 Less: Increase in EMV Without TIF 0 13 2023 186,803 81,428 14 2024 186,803 76,819 Difference $16,625,299 15 2025 186,803 72,471 16 2026 186,803 68,369 17 2027 0 0 18 2028 0 0 19 2029 0 0 20 2030 0 0 21 2031 0 0 22 2032 0 0 23 2033 0 0 24 2034 0 0 25 2035 0 0 26 2036 0 0 27 2037 0 0 28 2038 0 0 2,897,237 1,675,401 Market Value Analysis Estimated Impact on Other Taxing Jurisdictions City of Oak Park Heights, MN Tax Increment Financing (Renewal and Renovation) District No. 1-1 Oakgreen Project Northland Securities, Inc. - 2/16/2011 at 12:01 PM TIF 011511.xls - MVA-Impact f EXTRACT OF MINUTES OF A MEETING OF THE CITY COUNCIL OF THE CITY OF OAK PARK HEIGHTS MINNESOTA HELD April 14 2009 Pursuant to due call and notice thereof a regular or special meeting of the City Council of the City of Oak Park Heights Washington County Minnesota was duly held at the City Hall on Tuesday the 14 day of April 2009 at 700 pm for the purpose in part of calling a public hearing on the proposed establishment of Municipal Development District No 1 and the adoption of a Development Program therefore the proposed establishment of Tax Increment Financing Renewal and Renovation District No 1 lCarriage House Project within Development District No 1 and the proposed adoption of the Tax Increment Financing Plan relating thereto The following members were present and the following were absent Member McComber introduced the following resolution and moved its adoption RESOLUTION 090417 CALLING PUBLIC HEARING ON THE PROPOSED ESTABLISHMENT OF MUNICIPAL DEVELOPMENT DISTRICT NO 1 AND THE ADOPTION OF A DEVELOPMENT PROGRAM THEREFOR THE PROPOSED ESTABLISHMENT OF TAX INCREMENT FINANCING RENEWAL AND RENOVATION DISTRICT NO 1 1 WITHIN DEVELOPMENT DISTRICT NO 1 CARRIAGE HOUSE PROJECT AND THE PROPOSED ADOPTION OF A TAX INCREMENT FINANCING PLAN RELATING THERETO BE IT RESOLVED by the City Council the Council of the City of Oak Park Heights Minnesota the City as follows 1 Public Heariniz This Council shall meet on May 26 2009 at approximately 7 00 pm to hold a public hearing on the following matters a proposed establishment of Municipal Development District No 1 b the adoption of a Development Program therefore c the proposed establishment of Tax Increment Financing Renewal and Renovation District No 1 I Carriage House Project the Tax Increment Financing District within Development District No 1 and d the proposed adoption of a Tax Increment Financing Plan relating thereto all pursuant to and in accordance with Minnesota Statutes Sections 469124 through 469134 both inclusive as amended and Minnesota Statutes Sections 469174 through 4691799 both inclusive as amended collectively the Act 0 2325072v1 IL 2 Notice of Hearine Filine of Program and Plan The City Administrator is hereby authorized to cause a notice ofthe hearing substantially in the form attached hereto as Exhibit A to be published as required by the Act and to place a copy of the proposed Tax Increment Financing Plan on file in the Administrators Office at City Hall and to make such copies available for inspection by the public The motion for the adoption of the foregoing resolution was duly seconded by Councilmember Runk and upon vote being taken thereon the following voted in favor Council Members Abrahamson McComber Runk Swenson Mayor Beaudet and the following voted against the same None Whereupon said resolution was declared duly passed and adopted Passed by the City Council of the City of Oak Park Hei hts this 14 day ofA ril 2009 David Beaudet Mayor Zohnson Administrator 2325072v1 2 L STATE OF MINNESOTA ss COUNTY OF WASHINGTON I the undersigned being the duly qualified and acting City Administrator of the City of Oak Park Heights Minnesota DO HEREBY CERTIFY that the attached resolution is a true and correct copy of an extract of minutes of a meeting of the City Council of the City of Oak Park Heights Minnesota duly called and held as such minutes relate to the calling of a public hearing on the Citys Tax Increment Financing District WITNESS my had this 17 day of April i4 2325072YI 3 Exhibit A CITY OF OAK PARK HEIGHTS COUNTY OF WASHINGTON STATE OF MINNESOTA NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN that the City Council the Council ofthe City of Oak Park Heights Washington County Minnesota will hold a public hearing on Tuesday May 26 2009 at 700 pm at the City Hall in the CityofOakParkHeightsMinnesotarelatingtotheproposedestablishmentofMunicipalDevelopmentDistrictNo1andtheadoptionofaDevelopmentProgramthereforetheproposedestablishmentofTaxIncrementFinancingRenewalandRenovationDistrictNo11CarriageHouseProjecttheTaxIncrementFinancingDistrictwithinMunicipalDevelopmentDistrictNo1andtheproposedadoptionofaTaxIncrementFinancingPlanthereforpursuanttoMinnesotaStatutesSection469174through4691799inclusiveasamendedCopiesoftheDevelopmentProgramandTaxIncrementFinancingPlanasproposedtobeadoptedwillbeonfileandavailablefor public inspection at the office ofthe City Administrator at City Hall The property proposed to be included in Development District No 1 is described in the Development Program onfileintheofficeoftheCityAdministratorThepropertyproposedtobeincludedintheTaxIncrementFinancing District is described in the Tax Increment Financing Plan on file in the office ofthe City Administrator A map of Municipal Development District No 1 being the entire City and the Tax Increment Financing District is set forth below MAP ofMunicipal Development District No 1 Affixed as Exhibit A1 X l LcA d vao ae wor j lull lu ice I r 1 i I I I VE I alF 1 I 1K y I L i t All interested persons may appear at the hearing and present their views orally or in writing prior to the hearing 2325072v1 I II pS3 ty Pr i0 a1 42 m r d F STf k I I I Nf u 1i NO faxM4 SF MW OR I All sG f a re t e fr i fr i t aif p i 3 i r I f9 a L hJ v7 rF y i 4ff i fti F th CF vSrt Pivd nl yry t 4b l 1 ftfh vr s rt w f 1 vtr f F sA a r f v F N 3 ry t H c r 5 ti s F yra L4i R afj Bf a f ri yy F vNWLFr3f ur r 1 rim pir a a w e f t C f fig i Y r k F fC ty r a cv f RGvii d IEn1 4 s F ti S N E Tt 9 RoG n f yv 4 vli AC ors h 1 rte cr am I iWN atmYtJ i4u p kfi3 tys4a44C x s ypyg fi Main Office 45 South 7th Street, Suite 2500, Minneapolis, Minnesota 55402 Main Office Toll Free 1-800-851-2920 Iowa Office 1309 South Main Avenue, Sioux Center, Iowa 51250 Toll Free 1-888-794-2370 Direct 712 722-2370 Fax 712 722-2376 South Dakota Office 215 West Sioux Avenue, Pierre, South Dakota 57501 Toll Free 1-877-224-5557 Direct 605-224-5557 Fax 605-224-9554 www.northlandsecurities.com May 7, 2009 Stillwater Gazette 1931 Curve Crest Blvd. Stillwater, MN 55082 RE: CITY OF OAK PARK HEIGHTS, MN - Legal Newspaper Publication Attn: Legal Advertising Enclosed for publication as a legal notice in the May 15, 2009, edition of your newspaper is a Notice of Public Hearing and attached maps. Feel free to reduce the maps to the minimum size that allow them to remain readable. Your invoice for publication costs should be sent to the City of Oak Park Heights as per your normal billing procedure for their account at the following address: City of Oak Park Heights – Attn: Eric Johnson 14168 Oak Park Blvd. P.O. Box 2007 Oak Park Heights, MN 55082-3007 Also, please send one Affidavit of Publication to the Oak Park Heights City Hall and one to my attention at the address listed below. If, for any reason, you are unable to publish the enclosed information as indicated, please call me immediately at (612) 851- 5907. Very truly yours, NORTHLAND SECURITIES, INC. Nick M. Skarich Vice President Enclosures cc: Eric Johnson, City of Oak Park Heights Jenny Boulton, Briggs and Morgan Member FINRA and SIPC Exhibit A CITY OF OAK PARK HEIGHTS COUNTY OF WASHINGTON STATE OF MINNESOTA NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN that the City Council (the “Council”) of the City of Oak Park Heights, Washington County, Minnesota, will hold a public hearing on Tuesday, May 26, 2009, at 7:00 p.m., at the City Hall, in the City of Oak Park Heights, Minnesota, relating to the proposed establishment of Municipal Development District No. 1 and the adoption of a Development Program therefor, and the proposed establishment of Tax Increment Financing (Renewal and Renovation) District No. 1-1 (Carriage House Project) within Municipal Development District No. 1, and the proposed adoption of a Tax Increment Financing Plan therefor, pursuant to Minnesota Statutes, Section 469.174 through 469.1799, inclusive, as amended. Copies of the Development Program and Tax Increment Financing Plan as proposed to be adopted will be on file and available for public inspection at the office of the City Administrator at City Hall. The property proposed to be included in Development District No. 1 is described in the Development Program on file in the office of the City Administrator. The property proposed to be included in Tax Increment Financing District No. 1-1 is described in the Tax Increment Financing Plan on file in the office of the City Administrator. A map of Municipal Development District No. 1 and Tax Increment Financing District No. 1-1 is set forth below: All interested persons may appear at the hearing and present their views orally or in writing prior to the hearing. EXHIBIT I - Municipal Dev. District No. 1 The boundaries of Municipal Development District No. 1 are coterminous with the Oak Park Heights City limits. EXHIBIT IA - Tax Increment Financing District Tax Increment Financing (Renewal and Renovation) District No. 1-1 OAKGREEN AVENUE58TH STREET NORTH A RECOMMENDING RESOLUTION OF THE PLANNING COMMISSION CITY OF OAK PARK HEIGHTS WASHINGTON COUNTY MINNESOTA A RESOLUTION ESTABLISHING FINDINGS OF FACT AND RECOMMENDING TO THE CITY COUNCIL THAT THE REQUEST BY TIM NOLDE REPRESENTING OAKGREEN VILLA LLC AND GREEN TWIG LLC FOR PUD CONCEPT AND GENERAL PLAN PRELIMINARY AND FINAL PLAT VACATION OF EASEMENTS AND BUILDING HEIGHT CONDITIONAL USE PERMIT FOR THE OAKGREEN COMMONS AND CARRIAGE HOUSE COOPERATIVE DEVELOPMENT WEST OF OAKGREEN AVENUE AND NORTH OF 58 STREET SHOULD BE APPROVED WITH CONDITIONS WHEREAS the City of Oak Park Heights has received a request from Tim Nolde representing Oakgreen villa LLC and Green Twig LLC for PUD concept and general plan preliminary and final plat vacation of easements and building height conditional use permit for the Oakgreen Commons and Carriage House Cooperative development west of Oakgreen Avenue and north of 5 8th Street and after having conducted a public hearing relative thereto the Planning Commission of Oak Park Heights makes the following findings of fact 1 The real property affected by said application is legally described as follows to wit SEE ATTACHMENT A and 2 The applicant has submitted an application and supporting documentation to the Community Development Department consisting of the following items and SEE ATTACHMENT B 3 A PUD concept plan application for two 48 unit senior cooperative rental buildings referred to as the Carriage House Cooperative was filed in July 2008 The project was to be constructed in two phases and is located near the intersection of 5 8 Street North and Oakgreen Avenue and 4 The City Council approved the PUD concept plan at their August 26 2008 meeting In October 2008 the applicant submitted a PUD general plan request to allow the construction of the first phase of the Carriage Douse Cooperative The applicant withdrew this request prior to the Planning Commission public hearing and 5 The applicant proposes a general plan approval for the 48 unit Carriage House Cooperative building at the corner of Oakgreen Avenue and 58 Street The second building the Oakgreen Commons is a 122 assisted living facility and is to be constructed north of the Carriage House Cooperative on Oakgreen Avenue Concept and general plan approvals are requested for the Oakgreen Commons and 6 The property is zoned B4 Limited Business which allows residential development as a conditional use The underlying base zoning district shall remain with a PUD overlay and 7 City staff prepared a planning report dated May 6 2009 reviewing the PUD plat vacation and conditional use permit requests and 8 City staff recommends in the May 6 2009 planning report that the request be approved with conditions and 9 The Planning Commission held a public hearing at their May 14 2009 meeting took comments from the applicants and public closed the public hearing and made the following recommendation NOW THEREFORE BE IT RESOLVED BY THE PLANNING COMMISSION FOR THE CITY OF OAK PARK HEIGHTS THAT THE PLANNING COMMISSION RECOMMENDS THE FOLLOWING A The application submitted by Tim Nolde representing Oakgreen villa LLC and Green Twig LLC for PUD concept and general plan preliminary and final plat vacation of easements and building height conditional use permit for the Oakgreen Commons and Carriage House Cooperative development west of Oakgreen Avenue and north of 58 Street and affecting the real property as follows SEE ATTACHMENT A Be and the same as hereby recommended to the City Council of the City of Oak Park Heights for approval with the following conditions 1 The preliminary and final plat shall be approved by the City Engineer and City Attorney The plat shall dedicate the rightofway for Oakgreen Avenue 2 The applicant shall provide a graphic indicating which easements shall be vacated as part of the process subject to review and approval of the City Engineer and City Attorney 3 The Planning Commission is favorable to the proposed setbacks as part of the approval process for the PUD 4 The traffic numbers are subject to review and approval of the City Engineer 5 All tree removal and landscape plans shall be subject to review and approval of the City Arborist 2 6 The grading and drainage plans shall be subject to City Engineer and applicable watershed authority review and approval 7 The Fire Marshal and Police Chief should review the plans and determine the accessibility of emergency vehicles throughout the development 8 The Planning Commission is favorable to the proposed private and public trail system 9 All utility plans shall be subject to review and approval of the City Engineer 10 The site plan shall be revised to indicate 28 proof of parking stalls in addition to the stalls provided The plans for proof of parking shall be subject to the review and approval of City staff and the City Engineer 11 The trails and sidewalks shall be constructed in accordance with the City Engineers review and approvals 12 The Planning Commission was favorable to the final building plans The applicant shall provide a materials board for both buildings to be discussed at the City Council meeting 13 The Planning Commission was favorable to the conditional use permit for the building height 14 The snow storage area shall be subject to review and approval of the City Engineer 15 All lighting fixtures shall be full cut off and the maximum height of all freestanding light fixtures shall be no more than 25 feet 16 The Planning Commission was favorable to the use of bollard light fixtures if thy include an internal cut off fixture The lighting for the monument signs shall be compliant with the Zoning Ordinance and be subject to review and approval of City staff 17 The site plans shall be revised to include electrical transformers subject to review and approval of City staff 18 The applicant shall supply the homeowners association documents as required by the City Attorney for review and approval 19 The applicant is required to enter into an amended development agreement with the City in a form acceptable to the City subject to the review and approval of the City Attorney 20 The applicant has indicated in his application for Tax Increment Financing TIF that this project will not move forward without TIF approval The approval of the planned unit development is contingent upon approval of the TIF 21 All existing wells shall be capped and septic systems removed in accordance with State and local requirements subject to review and approval of the City Engineer 3 22 Any other conditions of City staff and the City Council Recommended by the Planning Commission of the City of Oak Park Heights this 14 day of May 2009 ATTEST Eri Jo i son City Administrator VWarrenWescha Chair 4 ATTACHMENT A Planned Unit Development PUD General Concept Plan Preliminary Final Plat Conditional Use Permit Building Height DrainageUtility Vacation Carriage House Cooperative Oakgreen Commons Washington County GEO Code 0502920 Legal Description Outlets C H 1 J K L M Oakgreen Village ATTACHMENT B Planned Unit Development PUD General Concept Plan Preliminary Final Plat Conditional Use Permit Building Height DrainageUtility Vacation Carriage House Cooperative Oakgreen Commons Application Materials Application Fees Plan Sets 3 Large Scale Sets20 11X17 Sets Written Narrative and Graphic Materials Explaining Proposal Mailing List from Washington County 500 from subject property Proof of Ownership or Authorization to Proceed Property Tax StatementsLegal Descriptions Conference With City Staff Upon Application Submittal April 29 2009 PUD General Concept Effect of Concept Plan Approval Unless the applicant shall fail to meet time schedules for filing General Plan of Development Stage andor Final Plans or shall fail to proceed with development in accordance with the plans as approved or shall in any other manner fail to comply with any condition of Ordinance 401 or any approval granted pursuant to it a General Concept Plan which has been approved and a PUD Agreement signed by the applicant shall not be modified revoked or otherwise impaired pending the application for approval of the General Plan of Development Stage and Final Plans by any action of the City of Oak Park Heights without consent of the applicant 401 06C2d PUD General Concept m Limitation on General Concept Plan Approval Unless a General Plan of Development covering the area designated as in the General Concept Plan as the first stage of the PUD has been filed within twelve 12 months from the date Council grants General Concept Plan approval or in any case where the applicant fails to file General Plan of Development Stage and Final Plans and to proceed with development in accordance with the provisions of this Ordinance and of an approved General Concept Plan the approval may be revoked by Council action 40100 C 2 e Conditional Use Permit Lapse of Approval Unless the City Council specifically approves a different time when action is officially taken on the request the conditional use permit shall become null and void twelve months after the date of approval unless the property owner or applicant has substantially started the construction of any building structure addition or alteration or use requested as part of the conditional use An application to extend the approval of a conditional use permit shall be submitted to the Zoning Administrator not less than thirty 30 days before the expiration of said approval 40103C4a and b Tax Increment Financing District Certification Request Supplement 1. Municipality Name: City of Oak Park Heights 2. TIF District Name: Tax Increment Financing (Renewal and Renovation) District No. 1-1 3. X New District District Expansion Hazardous Substance Subdistrict (Modification)    4. District Type: a. Redevelopment (M.S. 469.174, Subd. 10).  Maximum Duration: 26 years of tax increments. b. Housing (M.S. 469-174, Subd. 11).  Maximum Duration: 26 years of tax increments. c. X Renewal and Renovation (M.S. 469.174, Subd. 10a). Maximum Duration: 15 years of tax increments.  d. Housing Replacement (1995 Laws, Chap. 264, Art. 5, Secs. 44-47; 1996 Laws, Chap. 471, Art. 7, Secs. 21-22; 1997 Laws, Chapt. 231, Art. 10, Sec. 13; 1999 Laws, Chap. 248, Sec. 20).  Maximum Duration: 15 years of tax increments from each parcel. e. Soils Condition (M.S. 469.174, Subd. 19). Maximum Duration: Tax increments may be received for 12 years from the approval of the tax increment plan by the municipality.  f. Economic Development (M.S. 469.174, Subd. 12). Maximum Duration: 9 years of tax increments. (as amended)  5. If the district is a Redevelopment, Housing or a Hazardous Substance Subdistrict, is the minimum market value tax increment delay option elected (M.S. 469.175, Subd. 1, Paragraph (b))? Yes X No   6. Does the district have extended duration limits provided by a special law? Yes X No If yes, law citation:   7. Does the district's plan provide for any sharing of captured net tax capacity with the local taxing districts (M.S. 469.177, Subd. 2, Paragraph (a))? Yes X No   (Over) 8. Does the district's plan provide for its captured net tax capacity to be reduced by the fiscal disparity contribution (M.S. 469.177, Subd. 177, Subd. 3)? (Seven Metropolitan Counties and Taconite Tax Relief Area Counties Only). Yes (Clause B Option) X No (Clause A Option)   9. Date the district plan was approved by the municipality: June 9,, 2009 10. District contact person: Name: Eric Johnson Phone: (651) 439-4439 Address: 14168 Oak Park Blvd. Oak Park Heights, MN 55082-3007 Signature: (prepared by) Date: February 18, 2011 Note: All statute references are as amended by Special Session Laws 2001, Chapter 5, Article 15. County Auditor Use Only 11. Certification Request Date: 12. Certification Date: 13. Original Value and Tax Rate Year: Taxes Payable City of Oak Park HeightsRenewal and Renovation TIF DistrictSUMMARY SPREADSHEET 06/01/09 TIF Code No.PID #/Building NumberImproved or VacantSurvey Method UsedSite Area(S.F.)Coverage Area of Improvements(S.F.)Coverage Percent of ImprovementsCoverageQuantity(S.F.)No. of BuildingsBuildingReplacementCost15% of Replacement CostBuilding Code DeficienciesNo. of Buildings Exceeding 15% Criteria20% of Replacement CostMeets 20% Substandard CriteriaNo. of buildings determined substandardMeets Subd. 10a. (1) (iii) Requirements1 To be Determined Improved 70,045 13,960 19.9% 70,0451AImproved Interior & Exterior1 $195,977 $29,397 $42,589 1 $39,195 Yes 1 11A1BImproved Interior & Exterior1 $120,583 $18,087 $31,765 1 $24,117 Yes 1 11CImproved Interior & Exterior1 $204,478 $30,672 $41,920 1 $40,896 No 0 11DImproved Interior & Exterior1 $240,559 $36,084 $17,271 0 $48,112 No 0 12 To be DeterminedImproved 69,469 14,625 21.1% 69,4692AImproved Interior & Exterior1 $240,959 $36,144 $240,959 1 $48,192 Yes 1 12BImproved Interior & Exterior1 $227,713 $34,157 $14,418 0 $45,543 No 0 1TOTALS 139,514 139,514 6 4 3 6 100.0%Percent of buildings exceeding 15 percent code deficiency threshold67%Total Coverage %Percent of buildings exceeding 15 percent code deficiency threshold67% Percent of buildings determined substandard 50%Percent of buildings meeting Subd. 10a. (1) (iii) Requirements 100% M:\08Proj\080629\ADMN\TIF\Summary Spreadsheet\Revised 6-1-09\[Renewal TIF Summary Spreadsheet Revised June 1, 2009.xls]Property InfoLHB Project No. 080629Page 1Updated 6/1/2009 REPORT OF INSPECTION PROCEDURES AND RESULTS FOR DETERMINING QUALIFICATIONS OF A TAX INCREMENT FINANCING DISTRICT AS A RENEWAL AND RENOVATION DISTRICT Carriage House TIF District Oak Park Heights, Minnesota LHB Project No. 080629 June 1, 2009 Prepared For The City of Oak Park Heights Prepared by LHB, Inc. 250 Third Avenue North, Suite 450 Minneapolis, Minnesota 55401 Page 2 TABLE OF CONTENTS Page PART 1 Executive Summary ...............................................................................3 Purpose of Evaluation ................................................................3 Scope of Work ...........................................................................4 Conclusion .................................................................................4 PART 2 Minnesota Statute 469.174, Subdivision 10a Requirements .................4 PART 3 Procedures Followed ..............................................................................7 PART 4 Findings..................................................................................................8 A. Coverage Test ............................................................................8 B. Condition of Building Test ........................................................9 1. Replacement Cost ................................................................9 2. Code Deficiencies ................................................................9 3. System Condition Deficiencies ..........................................10 C. Distribution of Substandard Structures ....................................11 PART 5 Team Credentials .................................................................................13 APPENDIX A Property Condition Assessment Summary Sheet APPENDIX B Building Code and Condition Deficiencies Reports APPENDIX C Property Condition Assessment Building Replacement Cost Reports Code Deficiency Cost Reports Photographs Page 3 PART 1 – EXECUTIVE SUMMARY PURPOSE OF EVALUATION LHB was hired by the City of Oak Park Heights to inspect and evaluate the properties within a Tax Increment Financing Renewal and Renovation District (“TIF District”) proposed to be established by the City. The proposed TIF District is located in the City of Oak Park Heights, near the intersection of Oakgreen Avenue North and 58th Street North (Diagram 1). The purpose of LHB‟s work was to determine whether the proposed TIF District meets the statutory requirements for coverage, and whether six buildings on two parcels, located within the proposed TIF District, meet the qualifications required for a Renewal and Renovation District. Diagram 1 – Proposed TIF District Page 4 SCOPE OF WORK The proposed TIF District consists of two (2) parcels, with six (6) single family homes. A partially constructed four-plex is also located in the Northwest corner of the proposed TIF District. It is approximately 30 percent completed and not habitable, so we are not defining it as a building for purposed of this analysis. All six buildings in the proposed TIF District received an on-site interior and exterior inspection. Building code and Condition Deficiency reports for each building inspected by LHB are located in Appendix B. CONCLUSION After inspecting and evaluating the properties within the proposed TIF District and applying current statutory criteria for a Renewal and Renovation District under Minnesota Statutes, Section 469.174, Subdivision 10a, it is our professional opinion that the proposed TIF District qualifies as a Renewal and Renovation District. The remainder of this report describes our process and findings in detail. PART 2 – MINNESOTA STATUTE 469.174, SUBDIVISION 10a REQUIREMENTS The properties were inspected in accordance with the following requirements under Minnesota Statutes, Section 469.174, Subdivision 10(c), which states: Interior Inspection “The municipality may not make such determination [that the building is structurally substandard] without an interior inspection of the property...” Exterior Inspection and Other Means “An interior inspection of the property is not required, if the municipality finds that (1) the municipality or authority is unable to gain access to the property after using its best efforts to obtain permission from the party that owns or controls the property; and (2) the evidence otherwise supports a reasonable conclusion that the building is structurally substandard.” Documentation “Written documentation of the findings and reasons why an interior inspection was not conducted must be made and retained under section 469.175, subdivision 3(1).” Qualification Requirements Minnesota Statutes, Section 469.174, Subdivision 10 (a) (1) requires two tests for occupied parcels: A. Coverage Test …“parcels consisting of 70 percent of the area of the district are occupied by buildings, streets, utilities, or paved or gravel parking lots” Page 5 The coverage required by the parcel to be considered occupied is defined under Minnesota Statutes, Section 469.174, Subdivision 10(e), which states: “For purposes of this subdivision, a parcel is not occupied by buildings, streets, utilities, or paved or gravel parking lots unless 15 percent of the area of the parcel contains building, streets, utilities, or paved or gravel parking lots.” B. Condition of Buildings Test …“and 20 percent of the buildings are structurally substandard; and 30 percent of the other buildings require substantial renovation or clearance to remove existing conditions such as: inadequate street layout, incompatible uses or land use relationships, overcrowding of buildings on the land, excessive dwelling unit density, obsolete buildings not suitable for improvement or conversion, or other identified hazards to the health, safety, and general well-being of the community.” 1. Structurally substandard is defined under Minnesota Statutes, Section 469.174, Subdivision 10(b), which states: “For purposes of this subdivision, „structurally substandard‟ shall mean containing defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” Definition of Substantial Renovation Because “Substantial renovation” can mean different things to different people, LHB has attempted to clarify exactly what we consider to be “substantial renovation” as it relates to Minnesota Statutes, Section 469.174, Subdivision 10(a) (1). a. First we researched national standards as to how much building owners should budget for annual maintenance and repair on their buildings as a percentage of replacement cost of the building. 1. According to the University of California “Facilities Renewal Budget Model” report of 1999, building owners should budget between two and three percent of current replacement value of their buildings for maintenance and repair work. This does not include routine janitorial work and routine items such as changing light bulbs and filters. 2. According to the Building Research Board of the National Research Council, one and one-half to three percent of a building‟s replacement value should be budgeted for maintenance and repair. b. Based on this information, LHB utilized two and one-half percent as the desired amount of maintenance and repair that should be budgeted annually to keep a building in good working condition. We recognize through experience that only a small percentage of sophisticated building owners actually budget for and spend this amount of money every year on maintenance and repair. This is Page 6 because most business owners are driven by other budgetary issues and tend to neglect the building maintenance and repair line items in their annual budgets. c. By establishing how much a building owner should be budgeting per year for maintenance and repairs, LHB is of the opinion that we could more easily establish an amount that would be considered “substantial” in comparison. If an owner is budgeting 2.5 percent of the building‟s replacement cost annually, most business owners or home owners would have to take out a loan to cover the cost of a substantial building improvement. Assuming they had a fixed level of income to work with, they would have to keep the loan payment at a level very near the original 2.5 percent they should have been budgeting each year. In addition, they still would have to budget for the original 2.5 percent on top of the loan. In most cases, the mortgage terms would have to extend out to a point beyond the life expectancy of the building they were trying to improve, as most buildings built in the past fifty years are not designed to last beyond 40 years. d. Based on the calculations described above, we have defined substantial renovation for purposes of Minnesota Statutes, Section 469.174, Subdivision 10(a)(1), as renovation with costs exceeding 20% of the building‟s replacement value. Our goal in applying this 20% test is to provide a consistent threshold of renovation costs that must be met before we will even consider whether the building is structurally substandard within the meaning of the statute. If a building does not have building deficiencies that require renovation with costs exceeding 20% of replacement value we will not classify that building as structurally substandard. However, if a building does meet the 20% test we will not automatically classify that building as structurally substandard merely because it meets that test. A building that meets the minimum threshold test of necessitating renovation with costs exceeding 20% of replacement value will only be classified as structurally substandard if, in our professional judgment, the types of building deficiencies and the cost to correct the deficiencies satisfy the requirements of section 469.174, subd. 10(c)(1). e. We do not count energy code deficiencies toward the thresholds required by Minnesota Statutes, Section 469.174, Subdivision 10(b) and 10(c), due to concerns expressed by the State of Minnesota Court of Appeals in the Walser Auto Sales, Inc. vs. City of Richfield case filed November 13, 2001. 2. Buildings are not eligible to be considered structurally substandard unless they meet certain additional criteria, as set forth in Subdivision 10(c) which states: “A building is not structurally substandard if it is in compliance with the building code applicable to new buildings or could be modified to satisfy the building code at a cost of less than 15 percent of the cost of constructing a new structure of the same square footage and type on the site. The municipality may find that a building is not disqualified as structurally substandard under the preceding sentence on the basis of Page 7 reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or structural repairs, or other similar reliable evidence.” “Items of evidence that support such a conclusion [that the building is not disqualified] include recent fire or police inspections, on-site property appraisals or housing inspections, exterior evidence of deterioration, or other similar reliable evidence.” a. LHB counts energy code deficiencies toward the 15 percent code threshold required by Minnesota Statutes, Section 469.174, Subdivision 10(c)) for the following reasons: The Minnesota energy code is one of ten building code areas highlighted by the Minnesota Department of Labor and Industry website where minimum construction standards are required by law. The index page of the 2007 Minnesota Building Code lists the Minnesota Energy Code as a “Required Enforcement” area compared to an additional list of “Optional Enforcement” chapters. The Senior Building Code Representative for the Construction Codes and Licensing Division of the Minnesota Department of Labor and Industry confirmed that the Minnesota Energy Code is being enforced throughout the State of Minnesota. In a January 2002 report to the Minnesota Legislature, the Management Analysis Division of the Minnesota Department of Administration confirmed that the construction cost of new buildings complying with the Minnesota Energy Code is higher than buildings built prior to the enactment of the code. Proper TIF analysis requires a comparison between the replacement value of a new building built under current code standards with the repairs that would be necessary to bring the existing building up to current code standards. In order for an equal comparison to be made, all applicable code chapters should be applied to both scenarios. Since current construction estimating software automatically applies the construction cost of complying with the Minnesota Energy Code, energy code deficiencies should also be identified in the existing structures. PART 3 – PROCEDURES FOLLOWED A. LHB was able to schedule interior and exterior inspections for six buildings in the proposed TIF District. Inspections were conducted on February 2 and February 4, 2009. Page 8 PART 4 – FINDINGS A. Coverage Test 1. The total square foot area of each parcel in the proposed TIF District was obtained from City records, GIS mapping and site verification. 2. The total square foot area of buildings and site improvements on the parcels in the proposed TIF District was obtained from City records, GIS mapping and site verification. 3. The percentage of coverage for each parcel in the proposed TIF District was computed to determine if the 15 percent minimum requirement was met. The total square footage of parcels meeting the 15 percent requirement was divided into the total square footage of the entire district to determine if the 70 percent requirement was met. Finding: The proposed TIF District met the coverage test under Minnesota Statutes, Section 469.174, Subdivision 10(e), which resulted in parcels consisting of 100 percent of the area of the proposed TIF District being occupied by buildings, streets, utilities or paved drives or parking lots (Diagram 2). This exceeds the 70 percent area coverage requirement for the proposed TIF District under Minnesota Statutes, Section 469.174, Subdivision 10a (a) (1). Diagram 2 Shaded area denotes parcels more than 15 percent occupied by buildings, streets, utilities or paved drives or parking lot Page 9 B. Condition of Building Test 1. Replacement Cost The first step in evaluating a building to determine if it is substandard to a degree requiring substantial renovation or clearance is to determine its replacement cost. This is the cost of constructing a new structure of the same square footage and type on site. Replacement costs were researched using R.S. Means Cost Works square foot models for 2009. A replacement cost was calculated by first establishing building use (office, retail, residential, etc.), building construction type (wood, concrete, masonry, etc.), and building size to obtain the appropriate median replacement cost, which factors in the costs of construction in Oak Park Heights, Minnesota. Replacement cost includes labor, materials, and the contractor‟s overhead and profit. Replacement costs do not include architectural fees, legal fees or other “soft” costs not directly related to construction activities. Replacement cost for each building is tabulated in Appendix A. 2. Code Deficiencies The next step in evaluating a building is to determine what code deficiencies exist with respect to such building. Code deficiencies are those conditions for a building which are not in compliance with current building codes applicable to new buildings in the State of Minnesota. Minnesota Statutes, Section 469.174, Subdivision 10(c), specifically provides that a building cannot be considered structurally substandard if its code deficiencies are not at least 15 percent of the replacement cost of the building. As a result, it was necessary to determine the extent of code deficiencies for each building in the proposed TIF District. The evaluation was made by reviewing all available information with respect to such buildings contained in City Building Inspection records and making interior and exterior inspections of the buildings. LHB utilizes the 2006 Minnesota State Building Code as the official code for our evaluations. The Minnesota State Building Code is actually a series of provisional codes written specifically for Minnesota only requirements, adoption of several international codes, and amendments to the adopted international codes. After identifying the code deficiencies in each building, we used R.S. Means Cost Works 2009; Unit and Assembly Costs to determine the cost of correcting the identified deficiencies. We were than able to compare the correction costs with the replacement cost of each building to determine if the costs for correcting code deficiencies meet the required 15 percent threshold. Page 10 Finding: Four (4) out of six (6) buildings (66.7 percent) in the proposed TIF District contained code deficiencies exceeding the 15 percent threshold required by Minnesota Statutes, Section 469.174, Subdivision 10(c). A complete Building Code and Condition Deficiency report for each building in the proposed TIF District can be found in Appendix B of this report. 3. System Condition Deficiencies If a building meets the minimum code deficiency threshold under Minnesota Statutes, Section 469.174, Subdivision 10(c), then in order for such building to be “structurally substandard” under Minnesota Statutes, Section 469.174, Subdivision 10(b), the building‟s defects or deficiencies should be of sufficient total significance to justify “substantial renovation or clearance.” Based on this definition, LHB re-evaluated each of the buildings that met the code deficiency threshold under Minnesota Statutes, Section 469.174, Subdivision 10(c), to determine if the total deficiencies warranted “substantial renovation or clearance” based on the criteria we outlined above. System condition deficiencies are a measurement of defects or substantial deterioration in site elements, structure, exterior envelope, mechanical and electrical components, fire protection and emergency systems, interior partitions, ceilings, floors and doors. The evaluation of system condition deficiencies was made by reviewing all available information contained in City records, and making interior and exterior inspections of the buildings. LHB only identified system condition deficiencies that were visible upon our inspection of the building or contained in City records. We did not consider the amount of “service life” used up for a particular component unless it was an obvious part of that component‟s deficiencies. After identifying the system condition deficiencies in each building, we used our professional judgment to determine if the list of deficiencies would total more than 20 percent of the replacement value of the building when added to the cost of total code deficiencies. For example, if a building with a replacement value of 100 thousand dollars had 17 percent code deficiencies, we would look at the list of system condition deficiencies and make a professional judgment that the cost of fixing the system condition deficiencies would be at least $3,000 (3 percent), in order for that building to be considered substandard. Finding: In our professional opinion, three (3) of the six (6) buildings (50 percent) in the proposed TIF District are structurally substandard to a degree requiring substantial renovation or clearance, because of defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors which defects or deficiencies are of sufficient total significance to justify Page 11 substantial renovation or clearance. This exceeds the 20 percent requirement of Subdivision 10a. (a) (1) (ii). Subdivision 10a. (a) (1) (iii) Subdivision 10a. (a) (1) (iii) requires that at least 30 percent of the other buildings (i.e., all buildings excluding the 20 percent minimum standard) meet the Subdivision 10a (1), clause (iii) test in which the “other” buildings require substantial renovation or clearance to remove existing conditions such as: inadequate street layout, incompatible uses or land use relationships, overcrowding of buildings on the land, excessive dwelling unit density, obsolete buildings not suitable for improvement or conversion, or other identified hazards to the health, safety, and general well-being of the community. Finding: Six (6) out of the six (6) buildings (100 percent) in the proposed Renewal and Renovation District exhibit existing conditions warranting renovation or clearance as defined by Minnesota Statutes Subd. 10a. (1) (iii), described as follows: As noted above, three buildings (1A, 1B, and 2A) were found to be structurally substandard as defined by Minnesota Statutes, Section 469.174, Subdivsion 10 (b) and (c). The factors under Subdivision 10a (1), clause (iii) are broader, and include “obsolete buildings not suitable for conversion.” Buildings with deficiencies significant enough to meet the structurally substandard test are, in effect, buildings that are obsolete and not suitable for improvement. Therefore, all three buildings found to be substandard in Appendix A and B also meet the lesser “obsolescence” test of Subdivsion 10a (1), clause (iii). Buildings 1C, 1D, and 2B exhibited signs of deterioration, including code deficiencies, but not at a level warranting a substandard finding. However, the City of Oak Park Heights Comprehensive plan written in 1998 and updated in 2008 is redirecting this area to a Commercial land use, which makes the single-family houses an obsolete land-use. The value of these properties is in the underlying land, not the house sitting on the land, which over time, will lead to further deterioration of the buildings. C. Distribution of substandard structures Much of this report has focused on the condition of individual buildings as they relate to requirements identified by Minnesota Statutes, Section 469.174, Subdivision 10 and 10a. It is also important to look at the distribution of substandard buildings throughout the geographic area of the proposed TIF District. Page 12 Finding: Buildings meeting the requirements of Minnesota Statutes, Section 469.174, Subdivision 10 and 10a are reasonably distributed throughout the geographic area of the proposed TIF District (Diagram 3). Diagram 3 – Distribution of Substandard Structures Yellow Shading – Structurally Substandard Building Orange Shading – Other Conditions warranting renovation or clearance (Subd. 10a. (1) (iii) Page 13 PART 5 - TEAM CREDENTIALS Michael A. Fischer, AIA LEED AP - Project Principal/TIF Analyst Michael has nineteen years of architectural experience as project principal, project manager, project designer and project architect on municipal planning, educational, commercial and governmental projects. He is a Vice President at LHB and currently leads the Community Design Group in LHB‟s Minneapolis office. Michael completed a two-year Bush Fellowship at the Massachusetts Institute of Technology in 1999, earning Masters Degrees in City Planning and Real Estate Development. Michael has served on over 35 committees, boards and community task forces, including a term as City Council President and Chair of the Duluth/Superior Metropolitan Planning organization. He is currently a Planning Commissioner in Edina, Minnesota. He was one of four architects in the country to receive the National "Young Architects Citation" from the American Institute of Architects in 1997. Keow Chai (K.C.) Lim, AIA – Project Manager/Inspector K.C. has seven years of international experience prior to becoming an architect in the United States and has been with LHB since 1988. His experience includes multi-story speculative offices, commercial buildings, hospitality, manufacturing, residential, and cinema renovation and design. His close attention to the client‟s needs has contributed to a unique relationship with the owner and the designed space. K.C. is a creative designer who also has a special focus on architectural presentation and a unique rendering skill to bring forward the intricate design idea to clients. In addition to design, K.C. has several years experience in building inspections, preparation of construction documents and project management. M:\08Proj\080629\ADMN\TIF\Final Report\Oak Park Heights TIF Final Report Revised 06-01-09.doc APPENDICES Appendix A – Property Condition Assessment Summary Sheet Appendix B – Building Code and Condition Deficiencies Reports Appendix C - Property Condition Assessment Building Replacement Cost Reports Code Deficiency Cost Reports Photographs APPENDIX A Property Condition Assessment Summary Sheet APPENDIX B Building Code and Condition Deficiencies Reports APPENDIX C Property Condition Assessments Building Replacement Cost Reports Code Deficiency Cost Reports Photographs 1 Oak Park Heights, Minnesota Carriage House TIF District CODE/CONDITION DEFICIENCY REPORT June 1, 2009 Map No. & Building Name: #2A / 5800 Oakgreen Avenue Inspection Date(s) & Time(s): Feb. 2, 2009, 12:05 p.m. Inspection Type: Interior/Exterior Summary of Deficiencies: It is our professional opinion that this building is Substandard because: - Building Code deficiencies total more than 15% of replacement cost. - Substantial renovation (more than 20% of building replacement value) is required to correct Conditions found. Estimated Replacement Cost: $240,959 Estimated Cost to Correct Building Code Deficiencies: $240,959 Percentage of Replacement Cost: 100% Estimated cost to correct all deficiencies exceeds (20%): $48,192 (Estimated Cost to Correct Building Code Deficiencies is the total of code-related items priced on the „unit‟ and „assembly‟ estimate lists. The two are combined for the Total Cost. Other costs identified as „Condition Related‟ are not priced on those sheets). DESCRIPTION OF CONDITION DEFICIENCIES Minnesota Statutes, Section 469.174, Subdivision 10, states that a building is Structurally Substandard if it contains “defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” A. Defects in Structural Elements 1. Several cracks in basement foundation walls (5023/5027). B. Combination of Deficiencies 1. Essential Utilities and Facilities a. Total replacement cost - Gut building and reconstruct home. Extensive mold infestation; worst on the north-half of 4-season porch; especially on ceiling and walls; spread on to the other portion of home; very heavy mold smell; pose a health hazard (5032-5034/5036/5038-5042). Non-functioning HVAC Require handrail at front steps (5058) Missing window pane at Garage (5026) Unconnected rain leader at rear (5025) Provide egress window and well in basement floor IRC310.1. Require handrail at rear steps (5025) Damaged glazing at rear entry door (5025/5031) Provide penetrating roof vent from toilet Provide weather-proof power outlet Provide GFI in bathroom and kitchen Provide hard-wired smoke alarm in all (1) sleeping rooms, hall, & basement: MN299F.362. Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. Rotted woof fiber siding, especially at garage (5021/5022) 2 Unsecured abandon underground pipe - possible well/septic system (5054/5024) Cracked foundation wall (5023/5027) Missing ceiling light fixture cover (5035/5041) Damaged exterior light fixture (5057) Missing basement vent seal at rear (5046) Missing vent cover at chimney (5048) Loose wiring at garage (5050/5051/5053) Insulate exterior walls to meet present requirements Provide fresh air-intake for furnace to meet requirements Provide landing on other side of door at stair to meet requirements Insulate attic to meet present requirements Provide code compliant (20"x30") attic access Single pane window glazing - frosted and ice built-up on interior of glazing (5020) Floor finished removed (5039) Paint peel and holes on fascia board and siding (5019/5025/5056) 2. Light and Ventilation a. Total replacement cost - Gut building and reconstruct home. Extensive mold infestation; worst on the north-half of 4-season porch; especially on ceiling and walls; spread on to the other portion of home; very heavy mold smell; pose a health hazard (5032-5034/5036/5038-5042). No combustion/make-up air for furnace. 3. Fire Protection/Adequate Egress a. Total replacement cost - Gut building and reconstruct home. Extensive mold infestation; worst on the north-half of 4-season porch; especially on ceiling and walls; spread on to the other portion of home; very heavy mold smell; pose a health hazard (5032-5034/5036/5038-5042). Smoke detector is required in all sleeping room, hall, and floor: MN299F.50. CO2 detector is required 10‟-0” of any sleeping room: MN299F.50. GFI is required in all bathroom and kitchen. Exterior weather-proof power outlet is required. Provide egress window and well in basement floor IRC310.1. 4. Layout and Condition of Interior Partitions/Materials a. Total replacement cost - Gut building and reconstruct home. Extensive mold infestation; worst on the north-half of 4-season porch; especially on ceiling and walls; spread on to the other portion of home; very heavy mold smell; pose a health hazard (5032-5034/5036/5038-5042). Interior condition of ceiling, wall partitions, and doors are contaminated with extensive mold. Provide egress window and well in basement floor IRC310.1. Provide exterior GFI outlet. Non-functioning HVAC Missing window pane at Garage (5026) Damaged glazing at rear entry door (5025/5031) Provide penetrating roof vent from toilet Provide GFI in bathroom and kitchen Provide hard-wired smoke alarm in all (1) sleeping rooms, hall, & basement: MN299F.362. Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. Missing ceiling light fixture cover (5035/5041) Loose wiring at garage (5050/5051/5053) Provide fire-suppression system to meet requirements Insulate exterior walls to meet present requirements Provide fresh air-intake for furnace to meet requirements 3 Insulate attic to meet present requirements Provide code compliant (20"x30") attic access Single pane window glazing - frosted and ice built-up on interior of glazing (5020) Floor finished removed (5039) 5. Exterior Construction a. Total replacement cost - Gut building and reconstruct home. Extensive mold infestation; worst on the north-half of 4-season porch; especially on ceiling and walls; spread on to the other portion of home; very heavy mold smell; pose a health hazard (5032-5034/5036/5038-5042). Insulate exterior walls to meet present requirements. Require handrail at front steps (5058) Missing window pane at Garage (5026) Unconnected rain leader at rear (5025) Require handrail at rear steps (5025) Damaged glazing at rear entry door (5025/5031) Provide penetrating roof vent from toilet Provide weather-proof power outlet Rotted woof fiber siding, especially at garage (5021/5022) Unsecured abandon underground pipe - possible well/septic system (5054/5024) Cracked foundation wall (5023/5027) Damaged exterior light fixture (5057) Missing basement vent seal at rear (5046) Missing vent cover at chimney (5048) Provide fresh air-intake for furnace to meet requirements Paint peel and holes on fascia board and siding (5019/5025/5056) DESCRIPTION OF CODE DEFICIENCIES 1. Total replacement cost - Gut building and reconstruct home. Extensive mold infestation; worst on the north-half of 4-season porch; especially on ceiling and walls; spread on to the other portion of home; very heavy mold smell; pose a health hazard (5032-5034/5036/5038-5042). Non-functioning HVAC Require handrail at front steps (5058) Missing window pane at Garage (5026) Unconnected rain leader at rear (5025) Provide egress window and well in basement floor IRC310.1. Require handrail at rear steps (5025) Damaged glazing at rear entry door (5025/5031) Provide penetrating roof vent from toilet Provide weather-proof power outlet Provide GFI in bathroom and kitchen Provide hard-wired smoke alarm in all (1) sleeping rooms, hall, & basement: MN299F.362. Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. Rotted woof fiber siding, especially at garage (5021/5022) Unsecured abandon underground pipe - possible well/septic system (5054/5024) Cracked foundation wall (5023/5027) Missing ceiling light fixture cover (5035/5041) Damaged exterior light fixture (5057) Missing basement vent seal at rear (5046) Missing vent cover at chimney (5048) Loose wiring at garage (5050/5051/5053) Insulate exterior walls to meet present requirements 4 Provide fresh air-intake for furnace to meet requirements Provide landing on other side of door at stair to meet requirements Insulate attic to meet present requirements Provide code compliant (20"x30") attic access Single pane window glazing - frosted and ice built-up on interior of glazing (5020) Floor finished removed (5039) Paint peel and holes on fascia board and siding (5019/5025/5056). ENERGY CODE In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whether or not the building is substandard: - House - Insulate exterior walls to meet present requirements. - House - Insulate basement exterior walls to meet present requirements. - Attic - Insulate attic to meet present requirements. M:\08Proj\080629\ADMN\TIF\Building Reports\080629-Substandard Building Report-5800 Oakgreen Ave.doc 1 Oak Park Heights, Minnesota Carriage House TIF District CODE/CONDITION DEFICIENCY REPORT June 1, 2009 Map No. & Building Name: #1C / 5762 Oakgreen Avenue Inspection Date(s) & Time(s): Feb. 2, 2009, 11:20 a.m. Inspection Type: Interior/Exterior Summary of Deficiencies: It is our professional opinion that this building is Not Substandard because: - Building Code deficiencies total more than 15% of replacement cost. - Substantial renovation (more than 20% of building replacement value) is required to correct Conditions found. - However, energy code accounts for too high a percentage of the code deficiency items. Estimated Replacement Cost: $204,478 Estimated Cost to Correct Building & Energy Code Deficiencies: $41,920 Percentage of Replacement Cost: 20.5% Estimated cost to correct code and non-code condition deficiencies (20%): $40,896 (Estimated Cost to Correct Building and Energy Code Deficiencies is the total of code-related items priced on the „unit‟ and „assembly‟ estimate lists. The two are combined for the Total Cost. Other costs identified as „Condition Related‟ are not priced on those sheets). DESCRIPTION OF CONDITION DEFICIENCIES Minnesota Statutes, Section 469.174, Subdivision 10, states that a building is Structurally Substandard if it contains “defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” A. Defects in Structural Elements 1. Several cracks in basement foundation walls (4991/4992). B. Combination of Deficiencies 1. Essential Utilities and Facilities a. House - Insulate exterior walls to meet present requirements (4990-4999). b. House - Insulate basement exterior walls to meet present requirements. c. House - Replace deteriorated roof shingles (4958/4959/4967/5321/5322). d. House - Replace deteriorated fascia board at Garage (5061). e. House - Replace damaged fascia board at Garage (5322). f. House - Refinish fascia board around House (5061/5065/5067). g. House - Correct exterior grade at basement window (4962). h. House - Provide cover plate at telephone in-box (4963). i. House - Repair corner cover for siding to make air/water tight (4964). j. Garage - Replace deteriorated garage door (5010). k. Garage - Correct heater vent 1 to meet requirements (5011/5322). l. Garage - Correct heater vent 2 to meet requirements (4960/5012/5013). m. Basement - Provide fresh air-intake for furnace to meet requirements. n. Basement - Provide egress window and well in basement floor IRC310.1. o. Basement - Repair cracks in basement foundation walls (4991/4992). 2 p. Basement - Correct sewer pipe slope to meet requirement: Min. 1/8"=1'-0" (4990/4995/4998). q. Basement - Relocate power outlet away from water pipe to meet requirements (4995). r. Basement - Provide missing light fixture cover (4999). s. Basement - Correct sump discharged to meet requirements: Existing discharged into exterior grade (4995/4966). t. Basement - Correct discharge from washing machine into sewer in lieu of sump to meet requirements (4994/4998). u. Basement - Correct hot vent from hot-water heater to meet requirements (5001). v. Basement - Replace several electrical wiring to meet requirements (5002). w. Basement - Connect domestic water to city main (4996). x. Basement - Replace deteriorated windows to make air/water-tight (4990/4991/4997). y. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. z. Basement - Correct stair risers and treads to meet requirements, existing 7.75" risers/9” tread (5004- 5006). aa. Basement - Install rails on stair to meet requirements (4989/4993). bb. Main - Provide landing at door to meet requirement (5009). cc. Main - Provide threshold and seal to second door to make air/water tight (5009). dd. Main - Provide landing on other side of door at basement stair to meet requirements. ee. Main - Remove sprayed foam on front entry door to comply with exit requirements (4984). ff. Main - Provide exhaust fan to vent outside of building to meet requirements (5321). gg. Main - Provide GFI in bathroom (4972/4973). hh. Main - Provide GFI in kitchen (4985-4987). ii. Main - Provide hard-wired smoke alarm in all (3) sleeping rooms & hall: MN299F.362. jj. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. kk. Main - Replace damaged switch cover at hallway (5007). ll. Attic - Insulate attic to meet present requirements. 2. Light and Ventilation a. No combustion/make-up air for furnace. 3. Fire Protection/Adequate Egress a. Provide hard-wired smoke alarm in all floors: MN299F.362. b. Provide hard-wired smoke alarm in all (3) sleeping rooms & hall: MN299F.362. c. Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. d. Provide egress window and well in basement floor IRC310.1. e. Remove sprayed foam on front entry door to comply with exit requirements (4984). 4. Layout and Condition of Interior Partitions/Materials a. Interior condition of wall partitions is fair to good. b. House - Insulate basement exterior walls to meet present requirements. c. House - Provide cover plate at telephone in-box (4963). d. House - Repair corner cover for siding to make air/water tight (4964). e. Garage - Replace deteriorated garage door (5010). f. Garage - Correct heater vent 1 to meet requirements (5011/5322). g. Garage - Correct heater vent 2 to meet requirements (4960/5012/5013). h. Basement - Provide fresh air-intake for furnace to meet requirements. i. Basement - Provide egress window and well in basement floor IRC310.1. j. Basement - Repair cracks in basement foundation walls (4991/4992). k. Basement - Correct sewer pipe slope to meet requirement: Min. 1/8"=1'-0" (4990/4995/4998). l. Basement - Relocate power outlet away from water pipe to meet requirements (4995). m. Basement - Provide missing light fixture cover (4999). n. Basement - Correct sump discharged to meet requirements: Existing discharged into exterior grade (4995/4966). 3 o. Basement - Correct discharge from washing machine into sewer in lieu of sump to meet requirements (4994/4998). p. Basement - Correct hot vent from hot-water heater to meet requirements (5001). q. Basement - Replace several electrical wiring to meet requirements (5002). r. Basement - Connect domestic water to city main (4996). s. Basement - Replace deteriorated windows to make air/water-tight (4990/4991/4997). t. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. u. Basement - Correct stair risers and treads to meet requirements, existing 7.75" risers/9” tread (5004- 5006). v. Basement - Install rails on stair to meet requirements (4989/4993). w. Main - Provide landing at door to meet requirement (5009). x. Main - Provide threshold and seal to second door to make air/water tight (5009). y. Main - Provide landing on other side of door at basement stair to meet requirements. z. Main - Remove sprayed foam on front entry door to comply with exit requirements (4984). aa. Main - Provide exhaust fan to vent outside of building to meet requirements (5321). bb. Main - Provide GFI in bathroom (4972/4973). cc. Main - Provide GFI in kitchen (4985-4987). dd. Main - Provide hard-wired smoke alarm in all (3) sleeping rooms & hall: MN299F.362. ee. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. ff. Main - Replace damaged switch cover at hallway (5007). gg. Attic - Insulate attic to meet present requirements. 5. Exterior Construction a. House - Insulate exterior walls to meet present requirements (4990-4999). b. House - Replace deteriorated roof shingles (4958/4959/4967/5321/5322). c. House - Replace deteriorated fascia board at Garage (5061). d. House - Replace damaged fascia board at Garage (5322). e. House - Refinish fascia board around House (5061/5065/5067). f. House - Correct exterior grade at basement window (4962). g. House - Provide cover plate at telephone in-box (4963). h. House - Repair corner cover for siding to make air/water tight (4964). i. Basement - Connect domestic water to city main (4996). DESCRIPTION OF CODE DEFICIENCIES 1. House - Replace deteriorated fascia board at Garage (5061). 2. House - Replace damaged fascia board at Garage (5322). 3. House - Correct exterior grade at basement window (4962). 4. House - Provide cover plate at telephone in-box (4963). 5. House - Repair corner cover for siding to make air/water tight (4964). 6. Garage - Replace deteriorated garage door (5010). 7. Garage - Correct heater vent 1 to meet requirements (5011/5322). 8. Garage - Correct heater vent 2 to meet requirements (4960/5012/5013). 9. Basement - Provide fresh air-intake for furnace to meet requirements. 10. Basement - Provide egress window and well in basement floor IRC310.1. 11. Basement - Repair cracks in basement foundation walls (4991/4992). 12. Basement - Correct sewer pipe slope to meet requirement: Min. 1/8"=1'-0" (4990/4995/4998). 13. Basement - Relocate power outlet away from water pipe to meet requirements (4995). 14. Basement - Provide missing light fixture cover (4999). 15. Basement - Correct sump discharged to meet requirements: Existing discharged into exterior grade (4995/4966). 16. Basement - Correct discharge from washing machine into sewer in lieu of sump to meet requirements (4994/4998). 17. Basement - Correct hot vent from hot-water heater to meet requirements (5001). 18. Basement - Replace several electrical wiring to meet requirements (5002). 4 19. Basement - Connect domestic water to city main (4996). 20. Basement - Replace deteriorated windows to make air/water-tight (4990/4991/4997). 21. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. 22. Basement - Correct stair risers and treads to meet requirements, existing 7.75" risers/9” tread (5004-5006). 23. Basement - Install rails on stair to meet requirements (4989/4993). 24. Main - Provide landing at door to meet requirement (5009). 25. Main - Provide threshold and seal to second door to make air/water tight (5009). 26. Main - Provide landing on other side of door at basement stair to meet requirements. 27. Main - Remove sprayed foam on front entry door to comply with exit requirements (4984). 28. Main - Provide exhaust fan to vent outside of building to meet requirements (5321). 29. Main - Provide GFI in bathroom (4972/4973). 30. Main - Provide GFI in kitchen (4985-4987). 31. Main - Provide hard-wired smoke alarm in all (3) sleeping rooms & hall: MN299F.362. 32. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. 33. Main - Replace damaged switch cover at hallway (5007). ENERGY CODE In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whether or not the building is substandard: - House - Insulate exterior walls to meet present requirements (4990-4999). - House - Insulate basement exterior walls to meet present requirements. - Attic - Insulate attic to meet present requirements. M:\08Proj\080629\ADMN\TIF\Building Reports\080629-Substandard Building Report-5762 Oakgreen Ave.doc 1 Oak Park Heights, Minnesota Carriage House TIF District CODE/CONDITION DEFICIENCY REPORT June 1, 2009 Map No. & Building Name: #1B / 5754 Oakgreen Avenue Inspection Date(s) & Time(s): Feb. 2, 2009, 10:00 a.m. Inspection Type: Interior/Exterior Summary of Deficiencies: It is our professional opinion that this building is Substandard because: - Building Code deficiencies total more than 15% of replacement cost. - Substantial renovation (more than 20% of building replacement value) is required to correct Conditions found. Estimated Replacement Cost: $120,583 Estimated Cost to Correct Building Code Deficiencies: $31,765 Percentage of Replacement Cost: 26.34% Estimated cost to correct all deficiencies exceeds (20%): $24,117 (Estimated Cost to Correct Building Code Deficiencies is the total of code-related items priced on the „unit‟ and „assembly‟ estimate lists. The two are combined for the Total Cost. Other costs identified as „Condition Related‟ are not priced on those sheets). DESCRIPTION OF CONDITION DEFICIENCIES Minnesota Statutes, Section 469.174, Subdivision 10, states that a building is Structurally Substandard if it contains “defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” A. Defects in Structural Elements 1. Several cracks in basement foundation walls (4914/4917/4951). B. Combination of Deficiencies 1. Essential Utilities and Facilities a. House - Insulate exterior walls to meet present requirements (4913/5017). b. House - Replace single pane windows to meet present requirements (4924). c. House - Replace deteriorated roof shingles (4910/4912). d. House - Replace/repair damage siding (4955). e. House - Replace/repair aluminum awning over side entrance; missing a support (4920). f. House - Replace metal flashing at masonry chimney (4913). g. House - Provide hood over hot vent stack at chimney (4957). h. House - Provide exterior weather-proof power outlet. i. House - Replace rotted fascia board (4910). j. House - Provide railing on steps at side entry (4918). k. House - Paint peeling from siding (4951). l. House - Replace abandon HVAC system m. House - Replace hot and domestic water system n. House - Repair electrical system. o. House - Repair cracks in basement foundation walls (4914/4917/4951). p. Basement - Provide egress window and well in basement floor IRC310.1. q. Basement - Provide fresh air-intake for furnace to meet requirements. 2 r. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. s. Basement - Correct stair treads to meet requirements, existing 8” (4950). t. Basement - Install rails on stair to meet requirements (4937/4948). u. Main - Replace damaged glazing at side entry door (4921). v. Main - Provide landing on other side of door at basement stair to meet requirements (4936/4937). w. Main - Replace lavatory in bathroom (4925). x. Main - Repair damaged wall (4925). y. Main - Replace tub faucets (4925/4926). z. Main - Relocate existing power outlet away from tub (4926). aa. Main - Refinish basement door: paint peeling (4936). bb. Main - Refinish wall in closet and bedroom (4929/4930). cc. Main - Replace non-functioning storm door at side entry (4918). dd. Main - Provide exhaust fan to vent outside of building to meet requirements. ee. Main - Provide GFI in bathroom (4925/4926). ff. Main - Provide GFI in kitchen (4922/4932). gg. Main - Provide cover plate to power outlets (4921/4932/4934/4935). hh. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. ii. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. jj. Main - Remove, clean, and sanitized wall and floor finish of "waste" (4928/4931). kk. Main - Provide code compliant (20"x30") attic access. 2. Light and Ventilation a. No combustion/make-up air for furnace. b. Abandoned HAVC system. c. Abandoned domestic and hot-water system. d. Abandoned electrical system. 3. Fire Protection/Adequate Egress a. House - Replace/repair aluminum awning over side entrance; missing a support (4920). a. House - Provide hood over hot vent stack at chimney (4957). b. House - Provide railing on steps at side entry (4918). c. House - Replace abandon HVAC system d. House - Replace hot and domestic water system e. House - Repair electrical system. f. Basement -Provide egress window and well in basement floor IRC310.1. g. Basement - Provide fresh air-intake for furnace to meet requirements. h. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. i. Basement - Correct stair treads to meet requirements, existing 8” (4950). j. Basement - Install rails on stair to meet requirements (4937/4948). k. Main - Replace damaged glazing at side entry door (4921). l. Main - Provide landing on other side of door at basement stair to meet requirements (4936/4937). m. Main - Relocate existing power outlet away from tub (4926). n. Main - Replace non-functioning storm door at side entry (4918). o. Main - Provide GFI in bathroom (4925/4926). p. Main - Provide GFI in kitchen (4922/4932). q. Main - Provide cover plate to power outlets (4921/4932/4934/4935). r. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. s. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. t. Main - Provide code compliant (20"x30") attic access. 4. Layout and Condition of Interior Partitions/Materials a. Interior condition of wall partitions is fair. b. House - Insulate exterior walls to meet present requirements (4913/5017). c. House - Replace single pane windows to meet present requirements (4924). 3 d. House - Replace abandon HVAC system e. House - Replace hot and domestic water system f. House - Repair electrical system. g. Basement - Provide egress window and well in basement floor IRC310.1. h. Basement - Provide fresh air-intake for furnace to meet requirements. i. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. j. Basement - Correct stair treads to meet requirements, existing 8” (4950). k. Basement - Install rails on stair to meet requirements (4937/4948). l. Main - Replace damaged glazing at side entry door (4921). m. Main - Provide landing on other side of door at basement stair to meet requirements (4936/4937). n. Main - Replace lavatory in bathroom (4925). o. Main - Repair damaged wall (4925). p. Main - Replace tub faucets (4925/4926). q. Main - Relocate existing power outlet away from tub (4926). r. Main - Refinish basement door: paint peeling (4936). s. Main - Refinish wall in closet and bedroom (4929/4930). t. Main - Provide exhaust fan to vent outside of building to meet requirements. u. Main - Provide GFI in bathroom (4925/4926). v. Main - Provide GFI in kitchen (4922/4932). w. Main - Provide cover plate to power outlets (4921/4932/4934/4935). x. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. y. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. z. Main - Remove, clean, and sanitized wall and floor finish of "waste" (4928/4931). aa. Main - Provide code compliant (20"x30") attic access. 5. Exterior Construction a. House - Insulate exterior walls to meet present requirements (4913/5017). b. House - Replace deteriorated roof shingles (4910/4912). c. House - Replace/repair damage siding (4955). d. House - Replace/repair aluminum awning over side entrance; missing a support (4920). e. House - Replace metal flashing at masonry chimney (4913). f. House - Provide hood over hot vent stack at chimney (4957). g. House - Provide exterior weather-proof power outlet. h. House - Replace rotted fascia board (4910). i. House - Provide railing on steps at side entry (4918). j. House - Paint peeling from siding (4951). k. House - Repair cracks in basement foundation walls (4914/4917/4951). l. Main - Provide exhaust fan to vent outside of building to meet requirements. DESCRIPTION OF CODE DEFICIENCIES 1. House - Replace/repair damage siding (4955). 2. House - Replace/repair aluminum awning over side entrance; missing a support (4920). 3. House - Provide hood over hot vent stack at chimney (4957). 4. House - Provide exterior weather-proof power outlet. 5. House - Replace rotted fascia board (4910). 6. House - Provide railing on steps at side entry (4918). 7. House - Replace abandon HVAC system 8. House - Replace hot and domestic water system 9. House - Repair electrical system. 10. House - Repair cracks in basement foundation walls (4914/4917/4951). 11. Basement - Provide egress window and well in basement floor IRC310.1. 12. Basement - Provide fresh air-intake for furnace to meet requirements. 13. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. 14. Basement - Correct stair treads to meet requirements, existing 8” (4950). 4 15. Basement - Install rails on stair to meet requirements (4937/4948). 16. Main - Replace damaged glazing at side entry door (4921). 17. Main - Provide landing on other side of door at basement stair to meet requirements (4936/4937). 18. Main - Replace lavatory in bathroom (4925). 19. Main - Repair damaged wall (4925). 20. Main - Replace tub faucets (4925/4926). 21. Main - Relocate existing power outlet away from tub (4926). 22. Main - Replace non-functioning storm door at side entry (4918). 23. Main - Provide exhaust fan to vent outside of building to meet requirements. 24. Main - Provide GFI in bathroom (4925/4926). 25. Main - Provide GFI in kitchen (4922/4932). 26. Main - Provide cover plate to power outlets (4921/4932/4934/4935). 27. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. 28. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. 29. Main - Remove, clean, and sanitized wall and floor finish of "waste" (4928/4931). 30. Main - Provide code compliant (20"x30") attic access. ENERGY CODE In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whether or not the building is substandard: - House - Insulate exterior walls to meet present requirements (4913/5017). - House - Replace single pane windows to meet present requirements (4924). M:\08Proj\080629\ADMN\TIF\Building Reports\080629-Substandard Building Report-5754 Oakgreen Ave.doc 1 Oak Park Heights, Minnesota Carriage House TIF District CODE/CONDITION DEFICIENCY REPORT June 1, 2009 Map No. & Building Name: #1A / 5710 Oakgreen Avenue Inspection Date(s) & Time(s): Feb. 4, 2009, 12:20 a.m. Inspection Type: Interior/Exterior Summary of Deficiencies: It is our professional opinion that this building is Substandard because: - Building Code deficiencies total more than 15% of replacement cost. - Substantial renovation (more than 20% of building replacement value) is required to correct Conditions found. Estimated Replacement Cost: $195,977 Estimated Cost to Correct Building & Energy Code Deficiencies: $42,589 Percentage of Replacement Cost: 21.73% Estimated cost to correct all deficiencies exceeds (20%): $39,195 (Estimated Cost to Correct Building and Energy Code Deficiencies is the total of code-related items priced on the „unit‟ and „assembly‟ estimate lists. The two are combined for the Total Cost. Other costs identified as „Condition Related‟ are not priced on those sheets). DESCRIPTION OF CONDITION DEFICIENCIES Minnesota Statutes, Section 469.174, Subdivision 10, states that a building is Structurally Substandard if it contains “defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” A. Defects in Structural Elements 1. None observed. B. Combination of Deficiencies 1. Essential Utilities and Facilities a. House - Insulate exterior walls to meet present requirements (5275/5276/5278-5280). b. House - Refinish paint; peeling from masonry wall (5231/5307). c. House - Replace deteriorated roof shingle (5303). d. House - Provide hood over hot vent stack at chimney to meet requirements (5323). e. House - Provide missing light bulb (5228/5323). f. House - Provide exterior weather-proof power outlet. g. House - Replace single pane windows to meet present requirements (5231/5239/5263/5278/5307). h. Deck - Correct/replace guards to meet requirements (5300/5301/5304). i. Garage - Replace deteriorated garage door (5230/5233). j. Garage - Replace damaged siding (5232). k. Garage - Correct hot vent stack for heater to meet requirements (5320). l. Basement - Provide fresh air-intake for furnace to meet requirements. m. Basement - Provide egress window and well in basement floor and (2) sleeping rooms IRC310.1 (5291-5293/5296/5297). n. Basement - Repair basement foundation walls to prevent water penetration (5275/5280/5298/5299). o. Basement - Provide wallboard over exposed sprayed foam at window (5278). p. Basement - Provide missing ceiling light fixture (5277). 2 q. Basement - Insulate basement rim joist at perimeter (5284). r. Basement - Connect domestic water to city main (4996). s. Basement - Provide GFI in bathroom (5288-5290). t. Basement - Correct headroom at sleeping rooms; Existing 7'-3" (5291/5293). u. Basement - Extend exhaust to roof of building to meet requirements (5289). v. Basement - Provide gypsum board wall adjacent to windows to make air/water-tight (5278). w. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. x. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. y. Main - Provide missing grille cover at outlet (5270). z. Main - Provide rails on stair to meet requirements (5244/5371/5272). aa. Main - Provide exhaust fan to vent outside of building to meet requirements (5323). bb. Main - Provide missing water closet at bathroom (5256). cc. Main - Provide GFI in bathroom (5253/5254). dd. Main - Provide GFI in kitchen (5228-5266-5268). ee. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. ff. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. gg. Attic - Insulate attic to meet present requirements. 2. Light and Ventilation a. No combustion/make-up air for furnace. 3. Fire Protection/Adequate Egress a. Provide hard-wired smoke alarm in all floors: MN299F.362. b. Provide hard-wired smoke alarm in all (3) sleeping rooms & hall: MN299F.362. c. Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. d. Provide egress window and well in basement floor and all sleeping rooms IRC310.1. e. Basement - Provide wallboard over exposed sprayed foam at window (5278). 4. Layout and Condition of Interior Partitions/Materials a. Interior condition of wall partitions is good. b. House - Replace single pane windows to meet present requirements (5231/5239/5263/5278/5307). c. Basement - Provide fresh air-intake for furnace to meet requirements. d. Basement - Provide egress window and well in basement floor and (2) sleeping rooms IRC310.1 (5291-5293/5296/5297). e. Basement - Repair basement foundation walls to prevent water penetration (5275/5280/5298/5299). f. Basement - Provide wallboard over exposed sprayed foam at window (5278). g. Basement - Provide missing ceiling light fixture (5277). h. Basement - Insulate basement rim joist at perimeter (5284). i. Basement - Connect domestic water to city main (4996). j. Basement - Provide GFI in bathroom (5288-5290). k. Basement - Correct headroom at sleeping rooms; Existing 7'-3" (5291/5293). l. Basement - Extend exhaust to roof of building to meet requirements (5289). m. Basement - Provide gypsum board wall adjacent to windows to make air/water-tight (5278). n. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. o. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. p. Main - Provide missing grille cover at outlet (5270). q. Main - Provide rails on stair to meet requirements (5244/5371/5272). r. Main - Provide exhaust fan to vent outside of building to meet requirements (5323). s. Main - Provide missing water closet at bathroom (5256). t. Main - Provide GFI in bathroom (5253/5254). u. Main - Provide GFI in kitchen (5228-5266-5268). v. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. w. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. x. Attic - Insulate attic to meet present requirements. 3 5. Exterior Construction a. House - Insulate exterior walls to meet present requirements (5275/5276/5278-5280). b. House - Refinish paint; peeling from masonry wall (5231/5307). c. House - Replace deteriorated roof shingle (5303). d. House - Provide hood over hot vent stack at chimney to meet requirements (5323). e. House - Provide missing light bulb (5228/5323). f. House - Provide exterior weather-proof power outlet. g. Deck - Correct/replace guards to meet requirements (5300/5301/5304). h. Garage - Replace deteriorated garage door (5230/5233). i. Garage - Replace damaged siding (5232). j. Garage - Correct hot vent stack for heater to meet requirements (5320). k. Basement - Repair basement foundation walls to prevent water penetration (5275/5280/5298/5299). l. Basement - Connect domestic water to city main (4996). DESCRIPTION OF CODE DEFICIENCIES 1. House - Provide hood over hot vent stack at chimney to meet requirements (5323). 2. House - Provide missing light bulb (5228/5323). 3. House - Provide exterior weather-proof power outlet. 4. Deck - Correct/replace guards to meet requirements (5300/5301/5304). 5. Garage - Correct hot vent stack for heater to meet requirements (5320). 6. Basement - Provide fresh air-intake for furnace to meet requirements. 7. Basement - Provide egress window and well in basement floor and (2) sleeping rooms IRC310.1 (5291- 5293/5296/5297). 8. Basement - Repair basement foundation walls to prevent water penetration (5275/5280/5298/5299). 9. Basement - Provide wallboard over exposed sprayed foam at window (5278). 10. Basement - Provide missing ceiling light fixture (5277). 11. Basement - Insulate basement rim joist at perimeter (5284). 12. Basement - Connect domestic water to city main (4996). 13. Basement - Provide GFI in bathroom (5288-5290). 14. Basement - Correct headroom at sleeping rooms; Existing 7'-3" (5291/5293). 15. Basement - Extend exhaust to roof of building to meet requirements (5289). 16. Basement - Provide gypsum board wall adjacent to windows to make air/water-tight (5278). 17. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. 18. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. 19. Main - Provide missing grille cover at outlet (5270). 20. Main - Provide rails on stair to meet requirements (5244/5371/5272). 21. Main - Provide exhaust fan to vent outside of building to meet requirements (5323). 22. Main - Provide missing water closet at bathroom (5256). 23. Main - Provide GFI in bathroom (5253/5254). 24. Main - Provide GFI in kitchen (5228-5266-5268). 25. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. 26. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. ENERGY CODE In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whether or not the building is substandard: - House - Insulate exterior walls to meet present requirements (5275/5276/5278-5280). - House - Replace single pane windows to meet present requirements (5231/5239/5263/5278/5307). - Attic - Insulate attic to meet present requirements. M:\08Proj\080629\ADMN\TIF\Building Reports\080629-Substandard Building Report-5710 Oakgreen Ave.doc Oak Park Heights, Minnesota Carriage House TIF District CODE/CONDITION DEFICIENCY REPORT June 1, 2009 Map No. & Building Name: #2B / 5830 Oakgreen Avenue Inspection Date(s) & Time(s): February 4, 2009, 11:00 a.m. Inspection Type: Interior/Exterior Summary of Deficiencies: It is our professional opinion that this building is Not Substandard because: - Building Code deficiencies do not total more than 15% of replacement cost. - or - Substantial renovation (more than 20% of building replacement value) is not required to correct Conditions found. Estimated Replacement Cost: $227,713 Estimated Cost to Correct Building Code Deficiencies: $14,418 Percentage of Replacement Cost: 6.33% Estimated cost to correct code and non-code condition deficiencies (20%): $45,543 (Estimated Cost to Correct Building Code Deficiencies is the total of code-related items priced on the „unit‟ and „assembly‟ estimate lists. The two are combined for the Total Cost. Other costs identified as „Condition Related‟ are not priced on those sheets). Description of Condition Deficiencies Minnesota Statutes, Section 469.174, Subdivision 10, states that a building is Structurally Substandard if it contains “defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” A. Defects in Structural Elements 1. None observed. B. Combination of Deficiencies 1. Essential Utilities and Facilities a. House - Insulate exterior walls to meet present requirements. b. House - Replace single pane windows in basement to meet present requirements (5157/5161/5164). c. House - Replace deteriorated roof shingles (5156-5159/5162/5163). d. House - Provide hood over hot vent stack at chimney (5162). e. House - Paint peeling from siding (5162). f. House - Repair damaged step and masonry at exterior entry (5153/5166). g. House - Repair end of gutter (5162). h. Basement - Provide egress window and well in basement floor IRC310.1. i. Basement - Insulate rim joist (5201/5203/5206). j. Basement - Repair water seepage (5202). k. Basement - Remove hanging wires from floor joist (5198/5199/5203/5204/5206). l. Basement - Replace wiring with outlet and plug-in to meet requirements (5202). m. Basement - Insulate basement exterior walls to meet present requirements (5194/5152-5210). n. Basement - Provide fresh air-intake for furnace to meet requirements (5107/5110). o. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. p. Basement - Correct stair treads to meet requirements, existing tread 9"; riser 7.5” (5212/5213). q. Basement - Install rails on stair to meet requirements (5190/5191). r. Basement - Connect domestic water to city main: Existing well (5202). s. Main - Provide landing on other side of door at attic stair to meet requirements (5176). t. Main - Provide GFI in bathroom (5178/5180). u. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. v. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. w. Main - Replace mercury type thermostat (5229). x. Attic - Provide GFI in bathroom (5225-5227). y. Attic - Provide exhaust fan to vent outside of building to meet requirements. z. Attic - Provide hard-wired smoke alarm in all (1) sleeping rooms & hall: MN299F.362. aa. Attic - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. bb. Attic - Install rails on stair to meet requirements (5215). cc. Insulate attic to meet present requirements. 2. Light and Ventilation a. No combustion/make-up air for furnace. 3. Fire Protection/Adequate Egress a. Basement - Provide egress window and well in basement floor IRC310.1. b. Basement - Remove hanging wires from floor joist (5198/5199/5203/5204/5206). c. Basement - Replace wiring with outlet and plug-in to meet requirements (5202). d. Basement - Provide fresh air-intake for furnace to meet requirements (5107/5110). e. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. f. Provide hard-wired smoke alarm in all sleeping rooms, hall, and floors: MN299F.362. g. Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. 4. Layout and Condition of Interior Partitions/Materials a. Interior condition of wall partitions is good to excellent. b. House - Insulate exterior walls to meet present requirements. c. House - Replace single pane windows in basement to meet present requirements (5157/5161/5164). d. Basement - Provide egress window and well in basement floor IRC310.1. e. Basement - Insulate rim joist (5201/5203/5206). f. Basement - Repair water seepage (5202). g. Basement - Remove hanging wires from floor joist (5198/5199/5203/5204/5206). h. Basement - Replace wiring with outlet and plug-in to meet requirements (5202). i. Basement - Insulate basement exterior walls to meet present requirements (5194/5152-5210). j. Basement - Provide fresh air-intake for furnace to meet requirements (5107/5110). k. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. l. Basement - Correct stair treads to meet requirements, existing tread 9"; riser 7.5” (5212/5213). m. Basement - Install rails on stair to meet requirements (5190/5191). n. Basement - Connect domestic water to city main: Existing well (5202). o. Main - Provide landing on other side of door at attic stair to meet requirements (5176). p. Main - Provide GFI in bathroom (5178/5180). q. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. r. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. s. Main - Replace mercury type thermostat (5229). t. Attic - Provide GFI in bathroom (5225-5227). u. Attic - Provide exhaust fan to vent outside of building to meet requirements. v. Attic - Provide hard-wired smoke alarm in all (1) sleeping rooms & hall: MN299F.362. w. Attic - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. x. Attic - Install rails on stair to meet requirements (5215). y. Insulate attic to meet present requirements 5. Exterior Construction a. House - Replace deteriorated roof shingles (5156-5159/5162/5163). b. House - Provide hot vent hood at chimney (5162). c. House - Paint peeling from siding (5162). d. House - Repair damaged step and masonry at exterior entry (5153/5166). e. House - Repair end of gutter (5162). f. Basement - Provide egress window and well in basement floor IRC310.1. g. Basement - Repair water seepage (5202). Description of Code Deficiencies 1. House - Provide hood over hot vent stack at chimney (5162). 2. Basement - Provide egress window and well in basement floor IRC310.1. 3. Basement - Insulate rim joist (5201/5203/5206). 4. Basement - Repair water seepage (5202). 5. Basement - Remove hanging wires from floor joist (5198/5199/5203/5204/5206). 6. Basement - Replace wiring with outlet and plug-in to meet requirements (5202). 7. Basement - Provide fresh air-intake for furnace to meet requirements (5107/5110). 8. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. 9. Basement - Correct stair treads to meet requirements, existing tread 9"; riser 7.5” (5212/5213). 10. Basement - Install rails on stair to meet requirements (5190/5191). 11. Main - Provide landing on other side of door at attic stair to meet requirements (5176). 12. Main - Provide GFI in bathroom (5178/5180). 13. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. 14. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. 15. Main - Replace mercury type thermostat (5229). 16. Attic - Provide GFI in bathroom (5225-5227). 17. Attic - Provide exhaust fan to vent outside of building to meet requirements. 18. Attic - Provide hard-wired smoke alarm in all (1) sleeping rooms & hall: MN299F.362. 19. Attic - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. 20. Attic - Install rails on stair to meet requirements (5215). Energy Code In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whether or not the building is substandard: - House - Insulate exterior walls to meet present requirements. - House - Replace single pane windows in basement to meet present requirements (5157/5161/5164). - Basement - Insulate basement exterior walls to meet present requirements (5194/5152-5210). - Insulate attic to meet present requirements. M:\08Proj\080629\ADMN\TIF\Building Reports\080629-Not Substandard Building Report Template-5830 Oakgreen Ave.docx Oak Park Heights, Minnesota Carriage House TIF District CODE/CONDITION DEFICIENCY REPORT June 1, 2009 Map No. & Building Name: #1D / 5770 Oakgreen Avenue Inspection Date(s) & Time(s): February 4, 2009, 10:00 a.m. Inspection Type: Interior/Exterior Summary of Deficiencies: It is our professional opinion that this building is Not Substandard because: - Building Code deficiencies do not total more than 15% of replacement cost. - or - Substantial renovation (more than 20% of building replacement value) is not required to correct Conditions found. Estimated Replacement Cost: $240,559 Estimated Cost to Correct Building Code Deficiencies: $17,271 Percentage of Replacement Cost: 7.18% Estimated cost to correct code and non-code condition deficiencies (20%): $48,112 (Estimated Cost to Correct Building Code Deficiencies is the total of code-related items priced on the „unit‟ and „assembly‟ estimate lists. The two are combined for the Total Cost. Other costs identified as „Condition Related‟ are not priced on those sheets). Description of Condition Deficiencies Minnesota Statutes, Section 469.174, Subdivision 10, states that a building is Structurally Substandard if it contains “defects in structural elements or a combination of deficiencies in essential utilities and facilities, light and ventilation, fire protection including adequate egress, layout and condition of interior partitions, or similar factors, which defects or deficiencies are of sufficient total significance to justify substantial renovation or clearance.” A. Defects in Structural Elements 1. None observed. B. Combination of Deficiencies 1. Essential Utilities and Facilities a. House - Replace single pane windows to meet present requirements (5010/5090/5091). b. House - Provide exterior weather-proof power outlet. c. Garage - Replace damaged garage door to make air/water-tight (5072). d. Garage - Provide landing at entry door (5076). e. Garage - Provide rails at step at entry door (5076). f. Garage - Provide cover plate missing at power outlets (5150/5073/5078). g. Basement - Provide egress window and well in basement floor IRC310.1. h. Basement - Provide fresh air-intake for furnace to meet requirements. i. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. j. Basement - Connect laundry sink waste line to sewer line to meet requirements: Existing to sump pump (5138/5139/5143). k. Basement - Provide and finish basement wall with gypsum board (5138/5142). l. Basement - Replace damaged sump cover (5140). m. Basement - Provide gypsum wallboard over exposed sprayed insulation at basement windows (5122/5141). n. Basement - Secure power outlet missing at laundry room (5142). o. Basement - Correct sump pipe to discharge to exterior grade (5143/5144). p. Basement - Replace/reinstall removed water softener (5145). q. Basement - Correct stair to meet requirements, existing exceed 3/8" riser variant: existing 6.5"/7.75" and open risers (5118-5120/5145/5134). r. Basement - Install rails on stair to meet requirements (5117/5121/5145). s. Basement - Connect domestic water to city main (5123/5132). t. Basement - Provide grille missing from duct (5127). u. Main - Provide guards at sliding door: existing drop greater than 18" (5066). v. Main - Provide base missing at Living room (5181). w. Main - Provide cover plate missing at power outlets (5082/5115). x. Main - Provide floor grille missing at bathroom outlet (5095). y. Main - Provide exhaust fan to vent outside of building to meet requirements (5097). z. Main - Provide GFI in kitchen (5083/5084/5086). aa. Main - Provide safety glazing at bay window to meet requirements (5089-5091). bb. Main - Provide exhaust fan in bedroom bathroom and vent to exterior of building to meet requirements (5102-5105). cc. Main - Finish expose wall at basement stair (5114). dd. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. ee. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. ff. Main - Provide code compliant (20"x30") attic access. gg. Attic - Insulate attic to meet present requirements. 2. Light and Ventilation a. No combustion/make-up air for furnace. 3. Fire Protection/Adequate Egress a. Smoke detector is required in all sleeping room, hall, and floor: MN299F.50. b. CO2 detector is required 10‟-0” of any sleeping room: MN299F.50. c. GFI is required in all bathroom and kitchen. d. Exterior weather-proof power outlet is required. e. Provide egress window and well in basement floor IRC310.1. 4. Layout and Condition of Interior Partitions/Materials a. Interior condition of wall partitions is fair to good. b. House - Replace single pane windows to meet present requirements (50105090/5091). c. Garage - Provide landing at entry door (5076). d. Garage - Provide rails at step at entry door (5076). e. Garage - Provide cover plate missing at power outlets (5150/5073/5078). f. Basement - Provide egress window and well in basement floor IRC310.1. g. Basement - Provide fresh air-intake for furnace to meet requirements. h. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. i. Basement - Connect laundry sink waste line to sewer line to meet requirements: Existing to sump pump (5138/5139/5143). j. Basement - Provide and finish basement wall with gypsum board (5138/5142). k. Basement - Replace damaged sump cover (5140). l. Basement - Provide gypsum wallboard over exposed sprayed insulation at basement windows (5122/5141). m. Basement - Secure power outlet missing at laundry room (5142). n. Basement - Correct sump pipe to discharge to exterior grade (5143/5144). o. Basement - Replace/reinstall removed water softener (5145). p. Basement - Correct stair to meet requirements: Existing stair risers exceed 3/8" riser variant: existing 6.5"/7.75" and open risers (5118-5120/5145/5134). q. Basement - Install rails on stair to meet requirements (5117/5121/5145). r. Basement - Connect domestic water to city main (5123/5132). s. Basement - Provide grille missing from duct (5127). t. Main - Provide guards at sliding door: existing drop greater than 18" (5066). u. Main - Provide base missing at Living room (5181). v. Main - Provide cover plate missing at power outlets (5082/5115). w. Main - Provide floor grille missing at bathroom outlet (5095). x. Main - Provide exhaust fan to vent outside of building to meet requirements (5097). y. Main - Provide GFI in kitchen (5083/5084/5086). z. Main - Provide safety glazing at bay window to meet requirements (5089-5091). aa. Main - Provide exhaust fan in bedroom bathroom and vent to exterior of building to meet requirements (5102-5105). bb. Main - Finish expose wall at basement stair (5114). cc. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. dd. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. ee. Main - Provide code compliant (20"x30") attic access. ff. Attic - Insulate attic to meet present requirements. 5. Exterior Construction a. House - Replace single pane windows to meet present requirements (5010/5090/5091). b. House - Provide exterior weather-proof power outlet. c. Garage - Replace damaged garage door to make air/water-tight (5072). Description of Code Deficiencies 1. House - Provide exterior weather-proof power outlet. 2. Garage - Replace damaged garage door to make air/water-tight (5072). 3. Garage - Provide landing at entry door (5076). 4. Garage - Provide rails at step at entry door (5076). 5. Garage - Provide cover plate missing at power outlets (5150/5073/5078). 6. Basement - Provide egress window and well in basement floor IRC310.1. 7. Basement - Provide fresh air-intake for furnace to meet requirements. 8. Basement - Provide hard-wired smoke alarm in floor: MN299F.362. 9. Basement - Connect laundry sink waste line to sewer line to meet requirements: Existing to sump pump (5138/5139/5143). 10. Basement - Provide and finish basement wall with gypsum board (5138/5142). 11. Basement - Replace damaged sump cover (5140). 12. Basement - Provide gypsum wallboard over exposed sprayed insulation at basement windows (5122/5141). 13. Basement - Secure power outlet missing at laundry room (5142). 14. Basement - Correct sump pipe to discharge to exterior grade (5143/5144). 15. Basement - Replace/reinstall removed water softener (5145). 16. Basement - Correct stair to meet requirements, existing exceed 3/8" riser variant: existing 6.5"/7.75" and open risers (5118-5120/5145/5134). 17. Basement - Install rails on stair to meet requirements (5117/5121/5145). 18. Basement - Connect domestic water to city main (5123/5132). 19. Basement - Provide grille missing from duct (5127). 20. Main - Provide guards at sliding door: existing drop greater than 18" (5066). 21. Main - Provide base missing at Living room (5181). 22. Main - Provide cover plate missing at power outlets (5082/5115). 23. Main - Provide floor grille missing at bathroom outlet (5095). 24. Main - Provide exhaust fan to vent outside of building to meet requirements (5097). 25. Main - Provide GFI in kitchen (5083/5084/5086). 26. Main - Provide safety glazing at bay window to meet requirements (5089-5091). 27. Main - Provide exhaust fan in bedroom bathroom and vent to exterior of building to meet requirements (5102-5105). 28. Main - Finish expose wall at basement stair (5114). 29. Main - Provide hard-wired smoke alarm in all (2) sleeping rooms & hall: MN299F.362. 30. Main - Provide hard-wired CO2 detector 10'-0" of any sleeping room: MN299F.50. 31. Main - Provide code compliant (20"x30") attic access. Energy Code In addition to the building code deficiencies listed above, the existing building does not comply with the current energy code. These deficiencies are not included in the estimated costs to correct code deficiencies and are not considered in determining whether or not the building is substandard: - House - Replace single pane windows to meet present requirements (5010/5090/5091). - Attic - Insulate attic to meet present requirements. M:\08Proj\080629\ADMN\TIF\Building Reports\080629-Not Substandard Building Report Template-5770 Oakgreen Ave.docx 1 of 21 NOLDE TIF DOCUMENTS 2 of 21 NOLDE TIF DOCUMENTS 3 of 21 NOLDE TIF DOCUMENTS 4 of 21 NOLDE TIF DOCUMENTS 5 of 21 NOLDE TIF DOCUMENTS 6 of 21 NOLDE TIF DOCUMENTS 7 of 21 NOLDE TIF DOCUMENTS 8 of 21 NOLDE TIF DOCUMENTS 9 of 21 NOLDE TIF DOCUMENTS 10 of 21 NOLDE TIF DOCUMENTS 11 of 21 NOLDE TIF DOCUMENTS 12 of 21 NOLDE TIF DOCUMENTS 13 of 21 NOLDE TIF DOCUMENTS 14 of 21 NOLDE TIF DOCUMENTS 15 of 21 NOLDE TIF DOCUMENTS 16 of 21 NOLDE TIF DOCUMENTS 17 of 21 NOLDE TIF DOCUMENTS 18 of 21 NOLDE TIF DOCUMENTS 19 of 21 NOLDE TIF DOCUMENTS 20 of 21 NOLDE TIF DOCUMENTS 21 of 21 NOLDE TIF DOCUMENTS 45 South 7th Street Suite 2500 Minneapolis, MN 55402 (800) 851-2920 (612) 851-5900 Fax (612) 851-5917 EXTERNAL MEMORANDUM DATE: April 9, 2009 TO: Mr. Eric Johnson, City Administrator Members of the City Council CC: FROM: Nick Skarich, Vice President Northland Public Finance RE: Oakgreen TIF Development Dear Mr. Johnson and Council Members, I have further reviewed the Anchobaypro, Inc. proposal and have provided the attached financial analysis in efforts to aid the City in understanding the components of the proposed TIF project. I will be in attendance at the April 14th City Council meeting to further discuss the City’s role in the TIF process and the required steps moving forward. The most recent proposal includes two components. The first is 48-unit residential senior cooperative building that will be two stories in height and approximately 80,000 square feet in size. The second will be a 120-unit assisted living facility approximately 107,000 square feet in size. The construction is expected to be completed by late spring of 2011. This would result in the first tax increments being available in taxes payable 2011(partial based on 2009 completion). The benefits to the City include replacement of older housing stock, an addition of new housing units, including an assisted living facility and an increased future tax base. Procedurally, the City would start by first calling for a public hearing, which would typically be held approximately 45 days in the future. At that point Northland Securities and Briggs & Morgan will start the process of preparing the required documents and notices and forwarding those to the required parties. The developer would not be able to proceed, including the pulling of a building permit, until the City passes a resolution approving the establishment of the TIF district following the public hearing. The attached timeline describes the steps involved. The current request for financial assistance includes approximately $1,200,000 of tax increments to help offset $1,600,000 of acquisition related costs of the existing homes on the property and allow for a reasonable return on investment. This amounts to 5% of total project costs of approximately $24,000,000 which is a reasonable request. This would be accomplished based on the information provided. The assistance would be provided through a “pay-as-you-go” mechanism. This means that as taxes are paid on the property the tax increment portion would be returned to the City who would in turn reimburse the Developer on an annual basis. The payment amount would be determined by terms negotiated in the development agreement. The attached example reflects a 90% payout (10% admin to the City). The assumptions are based on 48 units assessed at an average of $225,000 and an assessed value of $15,000,000 on the assisted living as per the developer. Reimbursements are only made contingent on taxes being paid. No taxes = no TIF. This alleviates any financial risk to the City that would be assumed if the City were to issue bonds for instance. The statutory maximum duration for renewal and renovation districts is 16 years of collection. Dependent on final assumptions, the TIF district could fulfill its obligation in less than 16 years. Based on the attached analysis, and an assumed market value inflation of 0%, it would take 9 years for the assistance to be paid in full (interest rate at 6.00%). At that time the properties would go back on the City’s tax rolls. The developer is paying out-of-pocket for an independent third party study that will determine whether property will qualify as a renewal and renovation TIF district as proposed. This report will be finalized shortly. The current draft demonstrates that the district will qualify. Overall, the project looks promising for the City of Oak Park Heights. The City will need to determine its comfort level with the nature of the project, duration of the district, etc. We look forward to working with you on this project. Feel free to contact me with any questions at (612) 851-5907. Thank you. Documents DEADLINE ACTUAL Prepared MEETING MEETING DATE DATE DESCRIPTION by:TYPE TIME 4/14/2009 City Council adopts Resolution calling for public hearing B&M Regular 7:00 4/26/2009 4/24/2009 Notification of County Auditor (30 days before hearing)NS 4/26/2009 4/24/2006 Notification of School Board Clerk (30 days before hearing)NS 5/11/2009 Forward Notice To Legal Paper (Stillwater Gazette)NS Deadline - one day prior 5/14/2009 Planning Commission Review and Approval Regular 7:00 Resolution B&M TIF Documents NS 5/16/2009 5/15/2009 Publish Notice of Hearing (10 days before hearing)-- 5/26/2009 5/26/2009 Date of Public Hearing --Regular 7:00 5/26/2009 5/26/2009 City Council Adopts Resolution Creating Districts and Regular 7:00 Approving TIF Plan / Development Plan / Development Agreement N/A Establishing Resolutions B&M TIF Plan NS Development Plan NS Development Agreement B&M N/A 6/1/2009 File Documents With Commissioner of Revenue/State Auditor NS N/A 6/1/2009 Request District Certification From County Auditor NS TAX INCREMENT FINANCING (RENEWAL & RENOVATION) DISTRICT NO. 1-1 CARRIAGE HOUSE PROJECT SCHEDULE OF EVENTS TO ADOPT TAX INCREMENT DISTRICT DOCUMENTS CITY OF OAK PARK HEIGHTS, MINNESOTA MUNICIPAL DEVELOPMENT DISTRICT NO. 1 Timeline 040609 4/9/2009 EXHIBIT III - TIF District Assumptions Certification Request Date 06/01/09 Decertification Date 12/31/26 (16 Years of Increment) Present Value Date 06/01/09 Present Value Rate 6.00% Type of TIF District:Renewal and Renovation Type of Debt:Loan (Pay-as-you-go) Fiscal Disparities Election:NA Fiscal Disparities Rate:0.0000% Local Tax Capacity Rate: 87.312% 2008/2009 Administration:10.00% Pooling:0.00% Market Value Inflator:100.00% Base Value Information 2008/2009 2008/2009 2008/2009 CLASS RATE CLASS RATE 2008/2009 Class PID # EMV 1st Tier 2nd Tier NTC RES 05-029-20-14-0003 175,100 1.00% 1.25% 1,999 RES 05-029-20-11-0063 119,400 1.00% 1.25% 1,303 REN 05-029-20-11-0062 100 1.25% 1.25% 1 REN 05-029-20-11-0059 219,200 1.25% 1.25% 2,740 REN 05-029-20-11-0136 100,000 1.25% 1.25% 1,250 RES 05-029-20-11-0026 182,300 1.00% 1.25% 2,089 RES 05-029-20-11-0065 177,300 1.00% 1.25% 2,026 REN 05-029-20-11-0028 168,000 1.25% 1.25% 2,100 REN 05-029-20-11-0059 219,200 1.25% 1.25% 2,740 Total 1,360,600 16,248 2010/2011 2011/2012 2012/2013 2013/2014 Base EMV Coop $654,100 $654,100 $654,100 $654,100 Base EMV Assisted $706,500 $706,500 $706,500 $706,500 Increase in EMV Coop 7,609,425 10,145,900 10,145,900 10,145,900 Increase in EMV Assisted 10,720,125 14,293,500 14,293,500 14,293,500 Total Estimated Market Value $19,690,150 $25,800,000 $25,800,000 $25,800,000 NTC Project 1 - 1st Tier RES 0 0 0 0 NTC Project 1 - 2nd Tier RES 76,094 101,459 101,459 101,459 NTC Project 2. - 1st Tier REN 0 0 0 0 NTC Project 2 - 2nd Tier REN 134,002 178,669 178,669 178,669 Total Net Tax Capacity $210,096 $280,128 $280,128 $280,128 City of Oak Park Heights, MN Tax Increment Financing (Renewal and Renovation) District No. 1-1 Oakgreen Project Northland Securities, Inc. - 4/9/2009 at 12:28 PM TIF 041009 - Assumptions EXHIBIT IV - Projected Tax Increment Cash FlowLess: Less: Retained Annual School Less: Less: Less:Annual Total Base Fiscal Captured Gross Tax City County District Other State Admin. Additional AnnualPeriod Net Tax Net Tax Disp. @ Net Tax Increment@@@@Aud. Ded. Retainage Pooling NetEnding Capacity Capacity 0.0000% Capacity 87.312% 39.657% 26.343% 17.691% 3.621%0.36%10.00% 0.00% Revenue12/31/2010 16,248 16,248 0000000000 012/31/2011 210,096 16,248 0 193,848 169,253 76,874 51,065 34,294 7,019 609 16,864 0 151,78012/31/2012 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2013 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2014 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2015 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2016 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2017 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2018 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2019 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2020 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2021 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2022 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2023 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2024 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2025 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2026 280,128 16,248 0 263,880 230,399 104,647 69,514 46,683 9,555 829 22,957 0 206,61312/31/2027 280,128 280,128 0000000000 012/31/2028 280,128 280,128 0000000000 012/31/2029 280,128 280,128 0000000000 012/31/2030 280,128 280,128 0000000000 012/31/2031 280,128 280,128 0000000000 012/31/2032 280,128 280,128 0000000000 012/31/2033 280,128 280,128 0000000000 012/31/2034 280,128 280,128 0000000000 012/31/2035 280,128 280,128 0000000000 012/31/2036 280,128 280,128 0000000000 012/31/2037 280,128 280,128 0000000000 012/31/2038 280,128 280,128 0000000000 03,625,238 1,646,578 1,093,774 734,539 150,346 13,044 361,219 0 3,250,975City of Oak Park Heights, MNTax Increment Financing (Renewal and Renovation) District No. 1-1Oakgreen ProjectNorthland Securities, Inc. - 4/9/2009 at 12:28 PMTIF 041009 - TaxIncAnn EXHIBIT V - Projected Tax Impact/Market Value Analysis City of Washington I.S.D. #834 Oak Park Heights County Stillwater Other Total Total Taxable NTC 2008/2009 8,921,360 295,173,120 87,614,826 NA 391,709,306 Projected Retained NTC 263,880 263,880 263,880 263,880 Hypothetical New NTC 9,185,240 295,437,000 87,878,706 NA Existing Local Tax Rate 2008/2009 39.657% 26.343% 17.691% 3.621%87.312% Hypothetical Adj. Local Tax Rate 38.518% 26.319% 17.638% 3.621% 86.096% Difference 1.139% 0.024% 0.053%NA 1.216% Hypothetical Taxes on Retained NTC 101,641 69,452 46,543 NA Statement 1: If the projected Retained Captured Net Tax Capacity of the TIF District was hypothetically available to each of the taxing jurisdictions above, the result would be a lower local tax rate (see Hypothetical Adjusted Tax Rate above) which would produce the same amount of taxes for each taxing jurisdiction. In such a case, the total local tax rate would decrease by 1.216% (see Hypothetical Adj. Local Tax Rate above). The hypothetical tax that the Retained Captured Net Tax Capacity of the TIF District would generate is also shown above. Statement 2: Since the projected Retained Captured Net Tax Capacity of the TIF District is not available to the taxing jurisdictions, then there is no impact on taxes levied or local tax rates. (1) Taxable net tax capacity = total net tax capacity - captured TIF. (2) The impact on these taxing jurisdictions is negligible since they represent only 4.15% of the total tax rate. Annual Present Gross Tax Value @ Year Increment 6.00% 1 2009 169,253 165,997 2 2010 230,399 213,177 3 2011 230,399 201,110 4 2012 230,399 189,726 5 2013 230,399 178,987 Present Value Date 06/01/09 6 2014 230,399 168,856 Present Value Rate (Gross TIF) 6.00% 7 2015 230,399 159,298 8 2016 230,399 150,281 Increase in EMV With TIF District $24,439,400 9 2017 230,399 141,775 Less: P.V of Gross Tax Increment 2,360,647 10 2018 230,399 133,750 11 2019 230,399 126,179 Subtotal $22,078,753 12 2020 230,399 119,037 Less: Increase in EMV Without TIF 0 13 2021 230,399 112,299 14 2022 230,399 105,942 Difference $22,078,753 15 2023 230,399 99,945 16 2024 230,399 94,288 17 2025 0 0 18 2026 0 0 19 2027 0 0 20 2028 0 0 21 2029 0 0 22 2030 0 0 23 2031 0 0 24 2032 0 0 25 2033 0 0 26 2034 0 0 27 2035 0 0 28 2036 0 0 3,625,238 2,360,647 Market Value Analysis Estimated Impact on Other Taxing Jurisdictions City of Oak Park Heights, MN Tax Increment Financing (Renewal and Renovation) District No. 1-1 Oakgreen Project Northland Securities, Inc. - 4/9/2009 at 12:28 PM TIF 041009 - MVA-Impact Pay-as-you-go Note Note Date: 07/01/09 Note Rate:6.00% Proceeds: $1,200,000 Cash Balance: $1,741,452 Retained:100%Semi-Annual Loan Net TIF Developer Capitalized Balance Date Principle Interest P & I Revenue Contribution Interest Outstanding 1,200,000.00 8/1/2010 0.00 0.00 0.00 0.00 0.00 78,000.00 1,278,000.00 2/1/2011 0.00 0.00 0.00 0.00 0.00 38,340.00 1,316,340.00 8/1/2011 36,398.80 39,490.20 75,889.00 75,889.00 0.00 0.00 1,279,941.00 2/1/2012 37,490.77 38,398.23 75,889.00 75,889.00 0.00 0.00 1,242,450.00 8/1/2012 66,032.50 37,273.50 103,306.00 103,306.00 0.00 0.00 1,176,418.00 2/1/2013 68,013.46 35,292.54 103,306.00 103,306.00 0.00 0.00 1,108,405.00 8/1/2013 70,053.85 33,252.15 103,306.00 103,306.00 0.00 0.00 1,038,351.00 2/1/2014 72,155.47 31,150.53 103,306.00 103,306.00 0.00 0.00 966,196.00 8/1/2014 74,320.12 28,985.88 103,306.00 103,306.00 0.00 0.00 891,876.00 2/1/2015 76,549.72 26,756.28 103,306.00 103,306.00 0.00 0.00 815,326.00 8/1/2015 78,846.22 24,459.78 103,306.00 103,306.00 0.00 0.00 736,480.00 2/1/2016 81,211.60 22,094.40 103,306.00 103,306.00 0.00 0.00 655,268.00 8/1/2016 83,647.96 19,658.04 103,306.00 103,306.00 0.00 0.00 571,620.00 2/1/2017 86,157.40 17,148.60 103,306.00 103,306.00 0.00 0.00 485,463.00 8/1/2017 88,742.11 14,563.89 103,306.00 103,306.00 0.00 0.00 396,721.00 2/1/2018 91,404.37 11,901.63 103,306.00 103,306.00 0.00 0.00 305,317.00 8/1/2018 94,146.49 9,159.51 103,306.00 103,306.00 0.00 0.00 211,171.00 2/1/2019 96,970.87 6,335.13 103,306.00 103,306.00 0.00 0.00 114,200.00 8/1/2019 99,880.00 3,426.00 103,306.00 103,306.00 0.00 0.00 14,320.00 2/1/2020 14,320.00 429.60 14,749.60 14,749.60 0.00 0.00 0.00 8/1/2020 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2/1/2021 0.00 0.00 0.00 0.00 0.00 0.00 0.00 8/1/2021 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2/1/2022 0.00 0.00 0.00 0.00 0.00 0.00 0.00 8/1/2022 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2/1/2023 0.00 0.00 0.00 0.00 0.00 0.00 0.00 8/1/2023 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2/1/2024 0.00 0.00 0.00 0.00 0.00 0.00 0.00 8/1/2024 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2/1/2025 0.00 0.00 0.00 0.00 0.00 0.00 0.00 8/1/2025 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2/1/2026 0.00 0.00 0.00 0.00 0.00 0.00 0.00 8/1/2026 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2/1/2027 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1,316,341.71 399,775.89 1,716,117.60 1,716,117.60 0.00 116,340.00 City of Oak Park Heights, MN Oakgreen Project Tax Increment Financing (Renewal and Renovation) District No. 1-1 Northland Securities, Inc. - 4/9/2009 at 12:28 PM TIF 041009 - PayGoCity