Loading...
HomeMy WebLinkAbout2017-04-10 City Council Workshop PacketPPLLEEAASSEE NNOOTTEE SSTTAARRTT TTIIMMEE RULES OF CIVILITY FOR THE CITY COUNCIL, BOARDS, COMMISSIONS AND OUR COMMUNITY Following are rules of civility the City of Maplewood expects of everyone appearing at Council Meetings - elected officials, staff and citizens. It is hoped that by following these simple rules, everyone’s opinions can be heard and understood in a reasonable manner. We appreciate the fact that when appearing at Council meetings, it is understood that everyone will follow these principles: Speak only for yourself, not for other council members or citizens - unless specifically tasked by your colleagues to speak for the group or for citizens in the form of a petition. Show respect during comments and/or discussions, listen actively and do not interrupt or talk amongst each other. Be respectful of the process, keeping order and decorum. Do not be critical of council members, staff or others in public. Be respectful of each other’s tim e keeping remarks brief, to the point and non-repetitive. AGENDA MAPLEWOOD CITY COUNCIL MANAGER WORKSHOP 5:30 P.M. Monday, April 10, 2017 City Hall, Council Chambers A. CALL TO ORDER B. ROLL CALL C. APPROVAL OF AGENDA D. UNFINISHED BUSINESS None E. NEW BUSINESS 1. Frost English Village TIF Modification Discussion 2. Harvest Community Gardens 3. Park Ambassador and Youth Outreach Program Concepts F. ADJOURNMENT THIS PAGE IS INTENTIONALLY LEFT BLANK MEMORANDUM TO: Melinda Coleman, City Manager FROM: Michael Martin, AICP, Planner DATE: April 4, 2017 SUBJECT: Frost English Village TIF Modification Discussion Introduction Sherman Associates is requesting the city approve modifications to the tax-increment financing (TIF) plan that was approved as part of the effort to redevelop the 5.5 acre former Maplewood Bowl site into a three-phased, mixed-use project called Frost English Village. Originally, Phase 2 of the project was slated to be 79 units of senior affordable housing. Due to market demand, Sherman has revised the project and intends to build 107 market-rate, senior housing units. This project change increases the amount of increment available to be generated by the TIF District and the plan needs to be modified to account for this. Background On January 22, 2014, the Metropolitan Council approved a livable communities demonstration account (LCDA) grant request for the city of Maplewood for $1,900,000. This grant money was used for public infrastructure improvements along Frost Avenue and assisted the developer with the purchase of the Maplewood Bowl site. On April 13, 2015, the city council approved conditional use permit, lot division and design review requests, which were required for this project to move forward. This included building approval for the first phase which is a four-story, multi-family building with 50 units. On May 26, 2015, the city council approved a tax-increment financing (TIF) plan for this project. The TIF plan works to offset a portion of its eligible costs incurred in the redevelopment of the 5.5 acre former Maplewood Bowl site. Additionally, the city undertook public improvements as part of the larger Gladstone area redevelopment plan, which included costs spent both inside and outside of the TIF District. A portion of these city incurred public improvement costs were eligible for reimbursement from TIF revenue. Discussion The city council recently called for a public hearing to be held at the April 24 meeting where the proposed TIF plan modifications will be considered for approval. Staff wanted to take time at the April 10 workshop to discuss in detail the numbers and points of the proposed modifications. Springsted, the city’s financial consultant who is working on this proposed TIF plan modification, E1 Workshop Packet Page Number 1 of 92 will be present at the workshop to detail the modifications and answer any questions from the city council. Recommendation No action required. Attachments 1. Springsted TIF Overview Memo 2. Draft Modification TIF Plan 3. Power Point Presentation E1 Workshop Packet Page Number 2 of 92 MEMORANDUM TO: Members of the City Council, City of Maplewood Melinda Coleman, City Manager Michael Martin, Economic Development Coordinator FROM: Tom Denaway, Assistant Vice President Mikaela Huot, Vice President DATE: April 5, 2017 SUBJECT: City Council Workshop scheduled for April 10 related to the discussion of the proposed Modification to Tax Increment Financing (Redevelopment) District No. 1-13 At the request of the City, Springsted has performed a review of the proposed changes to the Phase 2 development scenario of the existing TIF District No. 1-13 as presented by the Developer. The Developer of the project is proposing to increase the size of the second phase of the development from a planned 79-unit senior affordable housing project to an anticipated 107-unit 55+ market rate apartment building. The Developer is seeking an increase in the amount of TIF assistance for Phase 2 due to the project no longer being eligible for tax credits, resulting in a gap in project financing. Modification of the TIF District The original TIF District had an overall budget for TIF revenues of $5,021,403, which was based on the original development scenario plus an assumed 2% market value inflator. The proposed changes to the second phase of the development regarding project size and proposed market values are expected to result in a significant increase in the amount of increment generated by the TIF District and available to finance eligible project costs. The District is able to remain in place as is without modification, but would need to operate within the confines of its current budget amount of $5,021,403; which would potentially limit both the City and Developer’s ability to utilize the anticipated increased TIF revenue stream. Given the potentially significant change in TIF revenue resulting from the revised development scenario for Phase 2, it is apparent that a formal TIF District Modification would be necessary to take advantage of the anticipated increase in TIF revenue resulting from the revised phase 2 development scenario. Springsted Incorporated 380 Jackson Street, Suite 300 Saint Paul, MN 55101-2887 Tel: 651-223-3000 Fax: 651-223-3002 www.springsted.com E1, Attachment 1 Workshop Packet Page Number 3 of 92 City of Maplewood Proposed Modification of Tax Increment Financing (Redevelopment) District No. 1-13 City Council Workshop Discussion April 5, 2017 Page 2 The process for modifying an existing TIF District is the same as the process undertaken when creating a TIF District, and will require going through the statutory notification process and holding of a public hearing on the modification, including notice to the County Commissioner, draft TIF Plan and fiscal & economic impacts sent to the County and School District, and publication of a public hearing notice. Notice of the proposed modification has been sent to the County Commissioner, draft versions of the TIF plan modification including the estimated impacts have been prepared and distributed to the County and School District. Additionally, a request for the publication of a notice of public hearing has been submitted to Maplewood Review for publication on Wednesday, April 12 to advertise the public hearing to be held on the potential modification of the TIF District at the City Council meeting on Monday, April 24. TIF Revenue Assumptions The assumptions outlined below were used in the creation of the TIF revenue projections used as the basis for determining the modified TIF District budget. As the TIF Plan budget represents the budget for the District as a whole, we took the opportunity to update the TIF revenue projections for all three phases of the development, as collectively they generate the total revenue on which the project budget is based. The revised three phases of the development are: Phase One: 50-Unit Affordable-Rate Multi-Family Development – already constructed Phase Two: 107-Unit 55+ Market-Rate Multi-Family Development – proposed to be constructed 2017 through 2018 Phase Three: 6,000 square foot retail building – no specific proposal on project start date, but for purposes of estimating TIF revenues we presumed a 2018 construction period. Base Value: The base value of $1,681,100 as provided by the County was distributed amongst each of the respective phases of the development. TIF Eligible Tax Rate Pay 2017: City: 47.248% County: 55.850% School District: 33.582% Miscellaneous: 10.385% Total Tax Rate: 147.065% Annual TIF revenue is generated by the lessor of; the current tax rate or the frozen rate at the time the TIF District was created (152.063%). As the current rate is the lesser of the two rates used to generate TIF revenue, we have revised the TIF revenues to be reflective of the lower taxes payable 2017 rate as outlined above. First Receipt of TIF and District Duration: 2018 – When the TIF Plan was adopted, the election was made to delay the first receipt of Tax Increment to the year 2018. This election was carried over to the modification. The TIF E1, Attachment 1 Workshop Packet Page Number 4 of 92 City of Maplewood Proposed Modification of Tax Increment Financing (Redevelopment) District No. 1-13 City Council Workshop Discussion April 5, 2017 Page 3 District will remain in existence for a period of 25-years from the date of first receipt (26-total years) resulting in a maximum statutory ending of the TIF District in 2043. Inflation: The revenue projections used in establishing the modified TIF Plan budget for revenues and expenses did not include a market value inflation assumption. Per Unit Market Value Assumption: $190,000 per unit assumed for both Phase One and Phase Two. The County has assigned a preliminary Assess2017 market value assumption of $9,500,000 to the completed 50-unit multi-family project that was undertaken in the first phase. This market value equates to a per-unit market value assumption of $190,000/unit. This is the market value assumption the County has applied to the first phase, and was a value they indicated would likely carry over to the second phase. The current Phase One market value assumption of $190,000/unit will be the basis on which the first TIF revenue is generated in taxes payable 2018, unless the County’s market value assessment is reduced through an appeal by the property owner. As the property value appeal process can be lengthy, with a final resolution potentially not known until April of 2018, we have utilized the current value assumption of $190,000 per unit as the basis for updating both Phase One and Phase Two TIF revenue projections, which had the corresponding impact of increasing the overall TIF District Budget. The current market value assumption represents the highest payable 2018 value that could potentially be in place for Phase One, as any adjustment to the value for taxes payable 2018 would only result in a lower market value assumption. Since the purpose of the TIF Plan Budget is to set the overall spending authority of the TIF District, we are comfortable using the current market value assumption as this allows us to set the budget at the broadest level of authority. In the event that the current value assumption is lowered by appeal, this would only result in a lower level of TIF revenue being generated and would not lead to the TIF District budget being exceeded, whereas the opposite could occur if we were to use a lower market value assumption. Modified TIF Plan Estimated Public Costs and Revenue: The modification of the TIF Plan allows for the revision of the budget for public costs and revenues, and provides the City with the authority to enter into new TIF redevelopment agreements. The modified TIF Plan itself does not enter the City into obligations, it merely provides the authority to enter into new subsequent agreements in a total amount in excess of the previous budget, but within the confines of the newly proposed budget. Since the modified TIF Plan budget is derived from the total revenues projected to be generated by the three phases of the development, we prepared updated revenue projections for all phases of the development, to account for the revised timeline and market value assumptions. As a result of the increase in the total overall budget we were able to increase the amount of revenue potentially available to the City to repay either pre-existing City costs incurred with initial redevelopment of the project, as well as potential future costs that could be incurred within the larger project area. The cumulative Modified budget for TIF revenues and expenses is outlined in the chart below. E1, Attachment 1 Workshop Packet Page Number 5 of 92 City of Maplewood Proposed Modification of Tax Increment Financing (Redevelopment) District No. 1-13 City Council Workshop Discussion April 5, 2017 Page 4 Modified - TIF Eligible Public Costs Private TIF eligible improvements, including demolition, relocation, site improvements/preparation costs, related infrastructure and other eligible improvements $4,016,300 Paygo Note Interest Payments 3,762,715 Public site work/infrastructure costs and Administrative expenses 1,957,000 Interest Incurred on Public Costs 2,244,894 Total $11,980,909 Modified - Estimated Sources of Revenue Tax Increment Revenue $11,980,909 Phase One – Multi-Family Project - Development Agreement Terms: The City Council previously entered into a Development Agreement with the Developer reimbursing them for $620,600 in eligible expenses on a pay-as-you-go basis for Phase One. The Developer will be reimbursed this principal amount, plus interest, from 83% of the annual Phase One TIF revenue. The City will capture the remaining 17% of the annual TIF revenue to reimburse itself for previously incurred costs and administrative expenses. The proposed modification to the TIF District does not contemplate the changing of any terms associated with the Phase One development agreement. Phase Two – 55+ Apartment Project – Proposed Development Agreement Terms: The potential terms for the development agreement for the Second Phase are currently being negotiated, and a formal development agreement is being drafted. The final version of the development agreement will be prepared for Council action at the April 24 City Council meeting following, the public hearing and action on the approval of the modification to the TIF District Plan. At the City Council workshop on April 10, Staff and Consultants will be seeking the Council’s comments on the following proposed agreement terms: Developer receives reimbursement for eligible project costs of up to $3,900,000 at an interest rate of 5%, to be repaid annually on a pay-as-you-go basis from 75% of annual Phase Two TIF revenues. The City would capture the remaining 25% of increment generated by the project to finance other public improvement costs in the District and Project Area as determined. When the TIF District was originally created, proposed terms for the development agreement for Phase Two and Three were discussed but never formally executed by a development agreement. The proposed terms at that time included the Developer receiving 90% of the annual increment, with the City only realizing 10%. Additionally, the original deal points discussed included a linkage between Phase Two and Phase Three. The linkage between Phases Two and Three allowed for the City to receive 100% of the increment for Phase Three, and also required that the Developer construct Phase Three before any increment would be available to the Developer from Phase Two. The purpose of this linkage was to ensure that both the City and Developer benefited, as the City’s benefit was almost entirely from the Phase Three, the linkage was proposed to ensure that both parties benefited and avoid a scenario where only the second phase was constructed and only the Developer benefited. E1, Attachment 1 Workshop Packet Page Number 6 of 92 City of Maplewood Proposed Modification of Tax Increment Financing (Redevelopment) District No. 1-13 City Council Workshop Discussion April 5, 2017 Page 5 The revised development agreement terms propose the dropping of the linkage between Phase Two and Three, in return for increasing the City’s retainage of increment from Phase Two from the original 10% up to 25%. The increased development scope for Phase Two, along with the revised per unit market value assumption, allows for the City’s total benefit from receiving 25% of the Phase Two revenues to exceed what was originally projected to be received by the City from both phases Two and Three. Additionally, by default the City will still capture 100% of the TIF revenue generated by the Third Phase unless they chose to enter into an additional development agreement for Phase Three at a later date. As a result of these circumstances it is proposed that the linkage requiring the Developer to construct Phase Three in order to receive increment from Phase Two be dropped; as the City’s benefit from the newly proposed Phase Two far exceeds the benefit that had been previously projected for both Phases Two and Three. The Developer’s potential reimbursement amount of $3,900,000 will be used to finance eligible improvements incurred during construction of both the first and second phase of the project. This amount of assistance was derived from the revised development scenario, which increased due to the change in overall size of the project to 107-units, as well as changed the second phase project from affordable to market rate which increased the annual amount of property taxes paid. The second phase of the project no longer being an affordable project, also removed a significant source of Developer equity as affordable housing tax credits were no longer available as an equity source. These factors alone would have increased the total amount of TIF revenue available to the project, as well as the amount of TIF requested by the Developer. These factors, coupled with the County’s Preliminary Assessed Market Value assumption of $190,000 per unit resulted in a significantly higher amount of TIF revenue potentially being generated by the project. However, this value assumption also results in a significantly higher level of property taxes being paid annually by the Developer. The value of the TIF revenue stream is derived from the level of property taxes paid by the project. Therefore, the final value of the potential TIF revenue stream will be subject to the County’s Final Assessed Market Value, as determined annually. If the initial value of $190,000 is appealed and successfully reduced, we anticipate a corresponding impact on the amount of property taxes paid by the project, as well as receipt of tax increments. As the potential Final Assessed Market Value is unknown at this point in time, the revenue projections are based on the preliminary assessed value of $190,000 per unit, which allows the TIF reimbursement amount of $3,900,000 to represent a cap on the total potential value of the TIF assistance provided to the Developer for Phase Two. If actual values end up higher than currently projected, it is anticipated that the currently estimated revenue stream should repay the Developer’s reimbursable amount of $3,900,000 at a faster rate, which will allow the City to retain an increased level of increment as they will receive all of the increment following repayment of the Developer’s pay-go amount. Conversely, if the actual values are less than currently projected, the total value of the assistance realized by the Developer may be less than the $3,900,000 as illustrated here; while the City would still retain its 25% portion of the annual increment revenue. E1, Attachment 1 Workshop Packet Page Number 7 of 92 City of Maplewood Proposed Modification of Tax Increment Financing (Redevelopment) District No. 1-13 City Council Workshop Discussion April 5, 2017 Page 6 City Benefit – Combined Phases: The increased development scenario for Phase Two along with the revised multi-family market value assumption of $190,000 per unit, resulted in a significant increase to the potential benefit realized by the City in comparison to the original TIF Plan. The original development scenario contemplated a total City benefit, on a net present value basis, of $448,155; whereas, the currently proposed development scenarios contemplates that amount increasing to $1,957,000. The final value of the City’s benefit will be subject to the final per-unit market value assumption and the build-out of Phase 3, but even if Phase 3 were not built and the final per-unit market value is substantially less; the City would still realize an increased benefit from what was originally proposed. The City will be able to utilize the proposed benefit to reimburse itself for costs previously incurred within the TIF District; as well as for potential future eligible public improvements outside the District under the allowance for up to 25% of the TIF expenditures (net of administrative expenses) to be spent outside the District. Next Steps: A representative from Springsted will be present at the workshop meeting on April 10, to provide an overview of the proposed TIF plan modification, as well as to receive comments regarding the proposed revisions to the Development Agreement Deal Points. Following this conversation the development agreement will be drafted, and the TIF Plan will be finalized for later consideration by the City Council, following the public hearing on this matter, held at the April 24 City Council Meeting. E1, Attachment 1 Workshop Packet Page Number 8 of 92 Maplewood, Minnesota DRAFT Modification No. 1: Tax Increment Financing Plan for Tax Increment Financing (Redevelopment) District No. 1-13 Within Development District No. 1 (Maplewood Bowl Redevelopment Project) Draft: March 28, 2017 Public Hearing Scheduled: April 24, 2017 Original TIF Plan Approved: May 26, 2015 Prepared by: SPRINGSTED INCORPORATED 380 Jackson Street, Suite 300 St. Paul, MN 55101-2887 (651) 223-3000 WWW.SPRINGSTED.COM E1, Attachment 2 Workshop Packet Page Number 9 of 92 INTRODUCTION The purpose of Modification No. 1 to the Tax Increment Financing Plan for the Tax Increment Financing (Redevelopment) District No. 1-13 Maplewood Bowl Redevelopment Project is to account for a change in the scope and timing of the proposed private development, as well as changes to the ration of public and private uses of TIF revenue. The original TIF Plan anticipated the second phase of the project would consist of a 79-unit affordable senior housing facility. The revised development scenario anticipates the second phase will now consist of a 107-unit market rate age-restricted housing facility. The modification also accounts for an increase in the project budget to account for the revised size and scope of the proposed development. The proposed modifications to the TIF plan are highlighted by underlined text. The proposed modification does not increase the overall geographic size of the District, but does increase the overall size of the budget. The sections being modified are: I, J, K, L, M, N, O, P, and V. Additionally, Exhibits II, III, and IV were modified. E1, Attachment 2 Workshop Packet Page Number 10 of 92 TABLE OF CONTENTS Section Page(s) A. Definitions .............................................................................................................................................................. 1 B. Statutory Authorization .......................................................................................................................................... 1 C. Statement of Need and Public Purpose ................................................................................................................. 1 D. Statement of Objectives ........................................................................................................................................ 1 E. Designation of Tax Increment Financing District as a Redevelopment District ...................................................... 2 F. Duration of the TIF District ..................................................................................................................................... 3 G. Property to be Included in the TIF District.............................................................................................................. 3 H. Property to be Acquired in the TIF District ............................................................................................................. 2 I. Specific Development Expected to Occur Within the TIF District .......................................................................... 3 J. Findings and Need for Tax Increment Financing ................................................................................................... 5 K. Estimated Public Costs .......................................................................................................................................... 4 L. Estimated Sources of Revenue ............................................................................................................................. 5 M. Estimated Amount of Bonded Indebtedness .......................................................................................................... 7 N. Original Net Tax Capacity ...................................................................................................................................... 7 O. Original Local Tax Rate ......................................................................................................................................... 6 P. Projected Retained Captured Net Tax Capacity and Projected Tax Increment ..................................................... 8 Q. Use of Tax Increment ............................................................................................................................................ 8 R. Excess Tax Increment ........................................................................................................................................... 7 S. Tax Increment Pooling and the Five Year Rule ..................................................................................................... 8 T. Limitation on Administrative Expenses .................................................................................................................. 8 U. Limitation on Property Not Subject to Improvements - Four Year Rule ................................................................. 9 V. Estimated Impact on Other Taxing Jurisdictions .................................................................................................. 11 W. Prior Planned Improvements ............................................................................................................................... 11 X. Development Agreements ................................................................................................................................... 12 Y. Assessment Agreements ..................................................................................................................................... 12 Z. Modifications of the Tax Increment Financing Plan ............................................................................................. 10 AA. Administration of the Tax Increment Financing Plan ........................................................................................... 11 AB. Filing TIF Plan, Financial Reporting and Disclosure Requirements ..................................................................... 11 Map of the Tax Increment Financing District within Development District No. 1 ...................................... EXHIBIT I Assumptions Report ............................................................................................................................... EXHIBIT II Projected Tax Increment Report ............................................................................................................ EXHIBIT III Estimated Impact on Other Taxing Jurisdictions Report ........................................................................EXHIBIT IV Market Value Analysis Report ................................................................................................................EXHIBIT V Executive Summary TIF District Qualification Report ............................................................................EXHIBIT VI E1, Attachment 2 Workshop Packet Page Number 11 of 92 City of Maplewood, Minnesota SPRINGSTED Page 1 Section A 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 Maplewood, 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 Ramsey County, Minnesota. "Development District" means Development District No. 1 in the City, which is described in the corresponding Development Program. "Development District Area" means the geographic area of the Development District. "Development Program" means the Development Program for the Development District. "School District" means Independent School District No. 622, Minnesota. “Special Law” means Minnesota Laws, 2013, Chapter 143, Article 9, Section 21. "State" means the State of Minnesota. "TIF Act" means Minnesota Statutes, Sections 469.174 through 469.1794, as amended, both inclusive. "TIF District" means Tax Increment Financing (Redevelopment) District No. 1-13. "TIF Plan" means the tax increment financing plan for the TIF District (this document). Section B Statutory Authorization See Section 1.3 of the Development Program for the Development District. Section C Statement of Need and Public Purpose See Section 1.4 of the Development Program for the Development District. Section D Statement of Objectives See Section 1.5 of the Development Program for the Development District. Section E Designation of Tax Increment Financing District as a Redevelopment District Redevelopment districts are a type of tax increment financing district in which one or more of the following conditions exists and is reasonably distributed throughout the district: (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 similar structures and more than 50% of the buildings, not including outbuildings, are structurally substandard requiring substantial renovation or clearance. A parcel is deemed E1, Attachment 2 Workshop Packet Page Number 12 of 92 City of Maplewood, Minnesota SPRINGSTED Page 2 "occupied" if at least 15% of the area of the parcel contains buildings, streets, utilities, paved or gravel parking lots; or other similar structures. (2) the property consists of vacant, unused, underused, inappropriately used, or infrequently used railyards, rail storage facilities, or excessive or vacated railroad right-of-ways; or (3) tank facilities, or property whose immediately previous use was for tank facilities, as defined in section 115C.02, subdivision 15, if the tank facilities: (i) have or had a capacity of more than 1,000,000 gallons; (ii) are located adjacent to rail facilities; and (iii) have been removed or are unused, underused, inappropriately used, or infrequently used. (iv) A qualifying disaster area, as defined in subdivision 10b. For districts consisting of two 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 redevelopment district in that it meets all of the criteria listed in (1) above. An executive summary of a report prepared by LHB, Inc. that details the qualifications is included in Exhibit VI. A copy of the entire report with supporting facts and documentation for this determination is on file with the City and is available to the public upon request. The full report will be retained by the City for the life of the TIF District. "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. Generally, 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 size and type. A city may not find that a building is structurally substandard without an interior inspection, unless it can not gain access to the property and there exists evidence which supports the structurally substandard finding. Such evidence includes 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. 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 three years of the filing of the request for certification of the parcel as part of the district; (2) the demolition or removal of the substandard building was performed or financed by the City, or was performed by a developer under a development agreement with the City, (3) the City 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, and (4) the City notifies the county auditor that the original tax capacity of the parcel must be adjusted upon filing the request for certification of the tax capacity of the parcel as part of a district. In the case of (4) 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 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, pollution, or E1, Attachment 2 Workshop Packet Page Number 13 of 92 City of Maplewood, Minnesota SPRINGSTED Page 3 contaminants, 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 or remediation necessary to develop the land, 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 F Duration of the TIF District Redevelopment districts may remain in existence 25 years from the date of receipt of the first tax increment. The City anticipates that the TIF District will remain in existence the maximum duration allowed by law (projected to be though the year 2043). Modification of this plan (see Section AA) shall not extend these limitations. All tax increments from taxes payable in the year the TIF District is decertified shall be paid to the City. Pursuant to MN Statutes, Section 469.175, Subdivision 1(b), the City elects to delay receipt of first increment until 2018. Section G Property to be Included in the TIF District The TIF District is an approximately 5.57-acre area of land located within the Development District. A map showing the location of the TIF District within the Development District is shown in Exhibit I. The boundaries and area encompassed by the TIF District are described below: Parcel Number* Legal Description* 162922140007 W 1/2 Of Vac Alley In Blk 1 Adj Lots 14 Thru 22 & E 1/2 Of Chambers St Vac Adj & Lots 14 Thru 22 In Blk 1 & W 1/2 Of Chambers St Vac & E 1/2 Of Alley Vac & Lots 6 Thru 11 Blk 2 & W 1/2 Of Alley Vac & Lots 12 Thru Lot 16 Blk 2 162922140074 E 1/2 Of Vac Alley Adj And Lots 9 1o And Lot 11 Blk 1 162922140073 E 1/2 Of Vac Alley Adj And Lot 8 Blk 1 162922140072 E 1/2 Of Vac Alley Adj And Lot 7 Blk 1 162922140071 E 1/2 Of Vac Alley Adj And Lot 6 Blk 1 162922140070 E 1/2 Of Vac Alley Adj And Lots 4 And Lot 5 Blk 1 162922140099 Subj To Rd; E 1/2 Of Vac Alley Accruing & Lots 1 Thru 3 Blk 1 E1, Attachment 2 Workshop Packet Page Number 14 of 92 City of Maplewood, Minnesota SPRINGSTED Page 4 162922140079 E 1/2 Of Chambers St Vac Adj & Fol; Ex E 80 Ft; Lots 23, 24 & Lot 25 Blk 1 162922140080 W 1/2 Of Vac Street & All Of Vac Alley Accruing & Lot 1 Blk 1 162922140081 Alleys & Street As Vac In Doc Nos. 1528547, 1807561 & 567589 Accruing & Fol; Lots 2 Thru 5 Blk 1 Kuhls Re & In Sd Lincoln Park; Lots 4 & Lot 5 Blk 2 162922140085 W 1/2 Of Alley As Vac In Doc #567589 Accruing & Fol; Lot 18 Blk 2 162922140086 W 1/2 Of Vac Alley Adj & Lot 17 Blk 2 The area encompassed by the TIF District shall also include all street or utility right-of-ways located upon or adjacent to the property described above. *The parcels to be located in the TIF District are being replatted. The Parcel Numbers and legal descriptions are representative of the parcels prior to the replatting. Section H Property to be Acquired in the TIF District The City may acquire and sell any or all of the property located within the TIF District; however, the City does not anticipate acquiring any such property at this time. Section I Specific Development Expected to Occur Within the TIF District The proposed project includes the redevelopment of the existing Maplewood Bowl site, into a three phase mixed-use development. The redevelopment of the site will be undertaken in three separate component, phase 1 of the redevelopment is projected to consist of an approximately 50-unit multi-family apartment building, phase 2 is projected to consist of an approximately 107-unit age-restricted multi-family apartment building, and phase 3 is projected to consist of an approximately 6,000 square foot commercial building. The redevelopment will also include corresponding site work, infrastructure, and parking improvements associated with mixed use project. The City anticipates using tax increment to reimburse the Developer for a portion of the TIF eligible project costs occurred in the development of the Facility. Included in the projected eligible costs to be reimbursed are costs associated with demolition of existing buildings, site work, private utility improvements, and other eligible improvements associated with the project. Additionally, the City anticipates using tax increment to finance public improvements and site work on property located within the Development District, along with related administrative expenses. Construction of the project is expected to begin in 2015, and be completed by 2018. The development is projected to be 100% assessed and on the tax rolls as of January 2, 2019 for taxes payable in 2020. E1, Attachment 2 Workshop Packet Page Number 15 of 92 City of Maplewood, Minnesota SPRINGSTED Page 5 At the time the TIF District was created there were no signed construction contacts with regards to the above described development. Section J Findings and Need for Tax Increment Financing In establishing the TIF District, the City makes the following findings: (1) The TIF District qualifies as a redevelopment district; See Section E of this document for the reasons and facts supporting this finding. (2) The proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future and 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 district permitted by the TIF Plan. Factual basis: Proposed development not expected to occur: The development includes the construction of the three-phase mixed use development. A key component to the redevelopment is the reimbursement of eligible expenses through tax increments. The Developer has indicated they would not undertake the proposed development without the financial assistance. Without the assistance the City has no reason to expect that significant reinvestment in the site would occur without assistance similar to that provided in this plan. Therefore the City has no reason to believe the development would occur but-for the use of tax increment assistance. To summarize the basis for the City’s findings regarding alternative market value, in accordance with Minnesota Statutes, Section 469.175, Subd. 3(d), the City makes the following determinations: 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 anywhere from $0 (except for a small amount for annual appreciation of land value) b. If the proposed development to be assisted with tax increment occurs in the District, the total increase in market value would be approximately $30,751,000, including the value of the building (See Exhibit V). 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 $5,774,075, (See Exhibit V) 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 $24,976,925 (the amount in clause b less the amount in clause c) without tax increment assistance. (3) The TIF Plan will afford maximum opportunity, consistent with the sound needs of the City as a whole, for development of the TIF District by private enterprise. Factual basis: The proposed development is the construction of a mixed-use redevelopment, in the Development District that is expected to create substantial new tax base for the City and the state. The E1, Attachment 2 Workshop Packet Page Number 16 of 92 City of Maplewood, Minnesota SPRINGSTED Page 6 development clearly meets the City's housing and redevelopment goals of creating additional affordable and senior housing opportunities; additionally, the development meets the agency’s goal of the removal of blight. (4) The TIF Plan conforms to general plans for development of the City as a whole. Factual basis: The City Planning Commission has determined that the development proposed in the TIF Plan conforms to the City comprehensive plan. (5) The City does not elect the method of tax increment computation set forth in Minnesota Statutes, Section 469.177, Subdivision 3(b); therefore subdivision 3(a) shall apply which indicates the original net tax capacity and the current net tax capacity shall be determined before the application of the fiscal disparity provisions (see method (a) in Section P). Section K Estimated Public Costs The estimated public costs of the TIF District are listed below. Such costs are eligible for reimbursement from tax increments of the TIF District. Estimated Public Costs Modified Budget Private TIF eligible improvements, including demolition, relocation, site improvements/preparation costs, related infrastructure and other eligible improvements $4,016,300 Paygo Note Interest Payments 3,762,715 Public site work/infrastructure costs and Administrative expenses 1,957,000 Interest Incurred on Public Costs 2,244,894 Total $11,980,909 The City reserves the right to administratively adjust the amount of any of the items listed above or to incorporate additional eligible items, so long as the total estimated public cost is not increased. The City reserves the right to spend available tax increment outside of the TIF District boundaries but within the Project Area. Section L Estimated Sources of Revenue Estimated Sources of Revenue Modified Budget Tax Increment revenue $11,980,909 Interest on invested funds 0 Bond proceeds 0 Loan proceeds 0 Grants 0 Other 0 Total $11,980,909 The City anticipates using future tax increments for reimbursement of public costs incurred from Section K. As increments are collected from the TIF District in future years, a portion of these tax increments will be reserved by the City as reimbursement for public costs incurred (primarily site work/infrastructure costs), either through internal funding or general obligation or revenue debt. The City also anticipates providing financial assistance to the proposed development through the use of pay-as-you-go financing. With pay-as-you-go financing, as tax increments are collected from the TIF District in future years, a portion of these tax increments will be distributed to the developer as reimbursement for eligible costs incurred related to the redevelopment of the site. E1, Attachment 2 Workshop Packet Page Number 17 of 92 City of Maplewood, Minnesota SPRINGSTED Page 7 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 TIF District to pay for such costs including, but not limited to, special assessments, utility revenues, federal or state funds, and investment income. Section M Estimated Amount of Bonded Indebtedness The City may consider issuing tax increment bonds to finance all or a portion of the estimated public costs, and reserves the right to issue such bonds in an amount not to exceed $11,980,909 (total estimated public costs). Section N Original Net Tax Capacity The County Auditor 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 State Commissioner of Revenue. For districts certified between January 1 and June 30, inclusive, this value is based on the previous assessment year. For districts certified between July 1 and December 31, inclusive, this value is based on the current assessment year. The Authority intends to file the request for certification prior to July 1, 2015. Therefore, the original net tax capacity will be the net tax capacity as of January 2, 2014. The Certified Estimated Market Value of all property within the TIF District as of January 2, 2014, for taxes payable in 2015, was $1,681,100. Upon redevelopment a portion of the site will be classified as rental property, and a portion will be classified as commercial property. The estimated tax capacity for purposes of the revenue projections in this TIF plan is $14,851, which is estimated to be the original net tax capacity of the TIF District based on reclassification of portions of the property applicable with their final use. Each year the County Auditor shall certify the amount that the original net tax capacity has increased or decreased as a result of: (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 O Original Local Tax Rate The County Auditor shall also certify the original local tax rate of the TIF District. This rate shall be the sum of all local tax rates that apply to property in the TIF District. This rate shall be for the same taxes payable year as the original net tax capacity. In future years, the amount of tax increment generated by the TIF District will be calculated using the lesser of (a) the sum of the current local tax rates at that time or (b) the original local tax rate of the TIF District. As noted in Section M, the Authority filed the TIF District for certification prior to July 1, 2015; therefore, the Original Local Tax Rate was the rate that applied for taxes payable in 2015, which was 152.063%. For purposes of estimating the tax increment generated by the TIF District, as proposed in this Modification, the sum of the current local tax rates for taxes levied in 2016 and payable in 2017, is 147.065% as shown below. Since E1, Attachment 2 Workshop Packet Page Number 18 of 92 City of Maplewood, Minnesota SPRINGSTED Page 8 annual tax increment revenue is generated based on the lower of the frozen tax rate (152.063%) or the current local tax rate (147.065%) we have based our TIF projections on the current local tax rate for taxes payable 2017. 2016/2017 Taxing Jurisdiction Local Tax Rate City of Maplewood 47.248% Ramsey County 55.850% ISD # 622 33.582% Other 10.385% Total 147.065% Section P Projected Retained Captured Net Tax Capacity and Projected Tax Increment The first phase of the development was initiated in 2015, and completed in 2016 creating a total tax capacity for the TIF District No. 1-13 of $84,418 as of January 2, 2017. The captured tax capacity as of that date is estimated to be $69,567 and the first-year of tax increment is estimated to be $102,309 payable in 2018. All phases of the project are anticipated to be completed by 2018, creating a total tax capacity of $343,045 as of January 2, 2019. The captured tax capacity as of that date is estimated to be $328,194, and the first year of full TIF receipt is projected to be $482,659 payable in 2020. A complete schedule of estimated tax increment from the TIF District is shown in Exhibit III. The estimates shown in this TIF Plan assume that commercial class rates remain at 1.5% for the first $150,000 of estimated market value and 2.0% of the market value above $150,000; while rental class rates will remain constant at 1.25% and 0.75% for 4(d) rental class rates. The projections do not assume an annual increase in market values. 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. For communities affected by the fiscal disparity provisions of Minnesota Statutes, Chapter 473F and Chapter 276A, the original net tax capacity of the TIF District shall be determined before the application of fiscal disparity. In subsequent years, the current net tax capacity shall either (a) be determined before the application of fiscal disparity or (b) exclude the product of any fiscal disparity increase in the TIF District (since the original net tax capacity was certified) times the appropriate fiscal disparity ratio. The method the City elects shall remain the same for the life of the TIF District, except that a single change may be made at any time from method (a) to method (b) above. »The City elects method (a), or M.S. Section 469.177, Subdivision 3(a). 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 II gives a listing of the various information and assumptions used in preparing a number of the exhibits contained in this TIF Plan, including Exhibit III which shows the projected tax increment generated over the anticipated life of the TIF District. Section Q 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 E1, Attachment 2 Workshop Packet Page Number 19 of 92 City of Maplewood, Minnesota SPRINGSTED Page 9 financial reporting and auditing of tax increment financing information throughout the state. Exhibit III shows the projected deduction for this purpose over the anticipated life of the TIF District. The City has determined that it will use 100% of the remaining tax increment generated by the TIF District for any of the following purposes: (1) pay for the estimated public costs of the TIF District (see Section K) and County administrative costs associated with the TIF District (see Section T); (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; 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 of 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 R 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; (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. E1, Attachment 2 Workshop Packet Page Number 20 of 92 City of Maplewood, Minnesota SPRINGSTED Page 10 Section S Tax Increment Pooling and the Five-Year Rule At least 75% of the tax increments 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 E for additional restrictions). No more than 25% of the tax increments may be spent on costs outside of the TIF District but within the boundaries of the Project Area, except to pay debt service on credit enhanced bonds. 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 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. Beginning with the sixth year following certification of the TIF District, at least 75% 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 anticipates that tax increments will be spent outside of the TIF District (including a portion for allowable administrative expenses) for eligible redevelopment pooling expenditures. Section T 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 physical development of the real property in the project; (3) relocation benefits paid to, or services provided for, persons residing or businesses located in the project; (4) amounts used to pay principal or interest on, fund a reserve for, or sell at a discount bonds issued pursuant to section 469.178; or (5) amounts used to pay other financial obligations to the extent those obligations were used to finance costs described in clause (1) to (3). 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 tax increment expenditures authorized by the TIF Plan or (b) 10% of the total tax increments received by the TIF District. E1, Attachment 2 Workshop Packet Page Number 21 of 92 City of Maplewood, Minnesota SPRINGSTED Page 11 Section U Limitation on Property Not Subject to Improvements - Four Year Rule If after four years from certification of the TIF District no demolition, rehabilitation, renovation, or 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 V Estimated Impact on Other Taxing Jurisdictions Exhibit IV shows the estimated impact on other taxing jurisdictions if the maximum projected retained captured net tax capacity of the TIF District was hypothetically available to the other taxing jurisdictions. The City believes that there will be no adverse impact on other taxing jurisdictions during the life of the TIF District, since the proposed development would not have occurred without the establishment of the TIF District and the provision of public assistance. 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. The fiscal and economic implications of the proposed tax increment financing district, as pursuant to Minnesota Statutes, Section 469.175, Subdivision 2, are listed below. 1. The total amount of tax increment that will be generated over the life of the TIF District is estimated to be $12,024,182. 2. To the extent the project in the TIF District generates any public cost impacts 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 TIF District upon the ability to issue other debt for general fund purposes, such costs will be levied upon the taxable net tax capacity of the City, excluding that portion captured by the TIF District. 3. The amount of tax increments over the life of the TIF 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 $2,745,697. 4. The amount of tax increments over the life of the TIF 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 $4,566,350. 5. No additional information has been requested by the County or School District that would enable it to determine additional costs that will accrue to it due to the development proposed for the district. Section W 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 E1, Attachment 2 Workshop Packet Page Number 22 of 92 City of Maplewood, Minnesota SPRINGSTED Page 12 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 X Development Agreements If within a project containing a redevelopment district, more than 25% of the acreage of the property to be acquired by the City is purchased with tax increment bonds proceeds (to which tax increment from the property is pledged), then prior to such acquisition, the City must enter into an agreement for the development of the property. Such agreement must provide recourse for the City should the development not be completed. The City anticipates entering into an agreement for development, but does not anticipate acquiring property located within the TIF District. Section Y 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 anticipate entering into an assessment agreements for the individual development phases. Section Z Modifications of the Tax Increment Financing Plan Any reduction or enlargement in the geographic area of the Development District or the TIF District; a determination to capitalize interest on the debt if that determination was not part of the original TIF Plan, increase in the portion of the captured net tax capacity to be retained by the City; increase in the total estimated public costs; or designation of 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. 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. E1, Attachment 2 Workshop Packet Page Number 23 of 92 City of Maplewood, Minnesota SPRINGSTED Page 13 Section AA 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 July 1, 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) 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: (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 estimated 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. Section AB Filing TIF Plan, Financial Reporting and Disclosure Requirements The City will file the TIF Plan, and any subsequent amendments thereto, with the Commissioner of Revenue and the Office of the State Auditor pursuant to Minnesota Statutes, Section 469.175, subdivision 4A. The City will comply with all reporting requirements for the TIF District under Minnesota Statutes, Section 469.175, subdivisions 5 and 6. E1, Attachment 2 Workshop Packet Page Number 24 of 92 Exhibit I SPRINGSTED MAP OF TAX INCREMENT FINANCING (REDEVELOPMENT) DISTRICT NO. 1-13 Within Development District No. 1 E1, Attachment 2 Workshop Packet Page Number 25 of 92 Exhibit II SPRINGSTED Assumptions Report City of Maplewood, Minnesota Tax Increment Financing (Redevelopment) District No. 1-13 Modification to TIF District TIF Projections - Combined Phases - Revised Development Scenario Type of Tax Increment Financing District Redevelopment Maximum Duration of TIF District 25 years from 1st increment Projected Certification Request Date 06/30/15 Decertification Date 12/31/43 (26 Years of Increment) 2014/2015 Base Estimated Market Value $1,681,100 Original Net Tax Capacity $14,851 Assessment/Collection Year 2015/2016 2016/2017 2017/2018 2018/2019 Base Estimated Market Value $1,681,100 $1,681,100 $1,681,100 $1,681,100 Estimated Increase in Value - New Construction 0 0 8,739,700 22,039,900 Total Estimated Market Value 1,681,100 1,681,100 10,420,800 23,721,000 Total Net Tax Capacity $14,851 $14,851 $84,418 $244,719 City of Maplewood 47.248% Ramsey County 55.850% ISD #622 33.582% Other 10.385% Local Tax Capacity Rate 147.065%2016/2017 Present Value Date & Rate 6/30/2015 5.00%PV Amount $5,774,075 Notes Projections assume no future changes to classification rates and current tax rates remain constant. Projections for Phase 1 and 2 are based on $190,000/unit market value. Value assumptions reflect current County assumption for Phase 1. Commercial Value for Phase 3 is $100PSF building plus current land value. Base value is applied to each phase based on replatted property. Projections are based on first receipt delayed to payable 2018. Projections for Phase 1 are based on 4D class rate. E1, Attachment 2 Workshop Packet Page Number 26 of 92 Exhibit III SPRINGSTED Projected Tax Increment ReportCity of Maplewood, MinnesotaTax Increment Financing (Redevelopment) District No. 1-13Modification to TIF District TIF Projections - Combined Phases - Revised Development ScenarioLess: Retained Times:Less:Less: AnnualAnnual Total Total Original Captured Tax Annual State Aud. Subtotal City DeveloperPeriod Market Net Tax Net Tax Net Tax Capacity Gross Tax Deduction Net Tax Eligible NetEnding Value Capacity Capacity Capacity Rate Increment 0.360% Increment Retainage Revenue(1)(2)(3)(4)(5)(6)(7)(8)(9)(10)(11)12/31/15 1,681,100 14,851 14,8510 147.065%0000012/31/16 1,681,100 14,851 14,8510 147.065%0000012/31/17 1,681,100 14,851 14,8510 147.065%0000012/31/18 10,420,800 84,418 14,851 69,567 147.065% 102,309368 101,941 21,701 80,24012/31/19 23,721,000 244,719 14,851 229,868 147.065% 338,057 1,217 336,840 82,128 254,71212/31/20 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/21 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/22 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/23 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/24 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/25 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/26 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/27 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/28 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/29 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 129,634 351,28812/31/30 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 147,944 332,97812/31/31 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/32 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/33 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/34 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/35 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/36 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/37 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/38 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/39 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/40 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/41 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/42 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,78512/31/43 30,751,000 343,045 14,851 328,194 147.065% 482,659 1,737 480,922 204,137 276,785$12,024,182 $43,273 $11,980,909 $4,201,894 $7,779,015 E1, Attachment 2 Workshop Packet Page Number 27 of 92 Exhibit IV SPRINGSTED Estimated Impact on Other Taxing Jurisdictions ReportCity of Maplewood, MinnesotaTax Increment Financing (Redevelopment) District No. 1-13Modification to TIF District TIF Projections - Combined Phases - Revised Development ScenarioWithoutProject or TIF DistrictWith Project and TIF DistrictFinalProjectedHypothetical2016/20172016/2017 Retained New Hypothetical Hypothetical Tax GeneratedTaxable 2016/2017 Taxable Captured Taxable Adjusted Decrease In by RetainedTaxingNet Tax Local Net Tax Net Tax Net Tax Local Local CapturedJurisdictionCapacity (1) Tax Rate Capacity (1) + Capacity = Capacity Tax Rate (*) Tax Rate (*) N.T.C. (*)City of Maplewood37,221,91547.248% 37,221,915$328,19437,550,109 46.835% 0.413% 153,710Ramsey County242,098,44255.850% 242,098,442 328,194 242,426,636 55.774% 0.076% 183,048ISD #62274,837,00033.582% 74,837,000 328,194 75,165,194 33.435% 0.147% 109,733Other (2)--- 10.385% --- 328,194 --- 10.385% --- --- Totals147.065%146.430% 0.635% * Statement 1: If the projected Retained Captured Net Tax Capacity of the TIF District was hypothetically available to each ofthe 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 ratewould decrease by 0.635% (see Hypothetical Decrease in Local Tax Rate above). The hypothetical tax that theRetained 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 disparity contribution, if applicable. (2) The impact on these taxing jurisdictions is negligible since they represent only 7.06% of the total tax rate.E1, Attachment 2 Workshop Packet Page Number 28 of 92 Exhibit VI SPRINGSTED Market Value Analysis Report City of Maplewood, Minnesota Tax Increment Financing (Redevelopment) District No. 1-13 Modification to TIF District TIF Projections - Combined Phases - Revised Development Scenario Assumptions Present Value Date 06/30/15 P.V. Rate - Gross T.I.5.00% Increase in EMV With TIF District $30,751,000 Less: P.V of Gross Tax Increment 5,774,075 Subtotal $24,976,925 Less: Increase in EMV Without TIF 0 Difference $24,976,925 Annual Present Gross Tax Value @ Year Increment 5.00% 1 2018 102,309 87,295 22019338,057 274,711 32020482,659 373,541 42021482,659 355,753 52022482,659 338,812 62023482,659 322,678 72024482,659 307,313 82025482,659 292,679 92026482,659 278,742 10 2027 482,659 265,468 11 2028 482,659 252,827 12 2029 482,659 240,788 13 2030 482,659 229,321 14 2031 482,659 218,401 15 2032 482,659 208,001 16 2033 482,659 198,097 17 2034 482,659 188,663 18 2035 482,659 179,679 19 2036 482,659 171,123 20 2037 482,659 162,974 21 2038 482,659 155,214 22 2039 482,659 147,823 23 2040 482,659 140,783 24 2041 482,659 134,080 25 2042 482,659 127,695 26 2043 482,659 121,614 $12,024,182 $5,774,075 E1, Attachment 2 Workshop Packet Page Number 29 of 92 Exhibit VI SPRINGSTED PART 1 – EXECUTIVE SUMMARY PURPOSE OF EVALUATION LHB was hired by the City of Maplewood to inspect and evaluate the properties within a Tax Increment Financing Redevelopment District (“TIF District”) proposed to be established by the City. The proposed TIF District is bounded by Atlantic Street on the West, Frost Avenue on the South and English Street on the East (Diagram 1). The purpose of LHB’s work is to determine whether the proposed TIF District meets the statutory requirements for coverage, and whether one (1) building on twelve (12) parcels, located within the proposed TIF District, meet the qualifications required for a Redevelopment District. Diagram 1 – Proposed TIF District SCOPE OF WORK The proposed TIF District consists of twelve (12) parcels with one (1) building. The building was inspected on April 23, 2015. A Building Code and Condition Deficiency report for the building that was inspected is located in Appendix B. E1, Attachment 2 Workshop Packet Page Number 30 of 92 Exhibit VI SPRINGSTED CONCLUSION After inspecting and evaluating the properties within the proposed TIF District and applying current statutory criteria for a Redevelopment District under Minnesota Statutes, Section 469.174, Subdivision 10, it is our professional opinion that the proposed TIF District qualifies as a Redevelopment District because: • The proposed TIF District has a coverage calculation of 95.7 percent which is above the 70 percent requirement. • 100 percent of the buildings are structurally substandard which is above the 50 percent requirement. • The substandard buildings are reasonably distributed. E1, Attachment 2 Workshop Packet Page Number 31 of 92 E1, Attachment 3Workshop Packet Page Number 32 of 92 City of Maplewood Presentation to City Council (Council Workshop) April 10, 2017 Proposed Modification to Tax Increment Financing (Redevelopment) District No. 1-13 Presenter: Mikaela Huot, Vice President, Springsted E1, Attachment 3Workshop Packet Page Number 33 of 92 2 •To provide a brief overview of Tax Increment Financing (TIF) •To provide overview of the proposed Modification of Tax Increment Financing (Redevelopment) District No. 1-13 •To provide update and status of redevelopment within Tax Increment Financing District No. 1-13 E1, Attachment 3Workshop Packet Page Number 34 of 92 3 •A method of capturing tax base growth resulting from new development •Captures new local taxes (increment) to pay for public improvements related to development •Fixed term for capture, then new development added to tax base E1, Attachment 3Workshop Packet Page Number 35 of 92 4 •Defined by State Statute 469.174 – 469.1794 •Gap financing tool •Depending on year created, different compliance requirements apply •Used mainly by Cities and Counties •Provides incentive for redevelopment •Financing tool to implement development and redevelopment projects E1, Attachment 3Workshop Packet Page Number 36 of 92 Types of TIF Districts Types of Districts Criteria Term Redevelopment Heavy blight and concentrated development—70% 25 years Renewal and renovation Lighter blight and concentration 15 years Housing Low and moderate income housing 25 years Soils condition Contaminated soils 20 years Economic development Manufacturing 8 years 5 E1, Attachment 3Workshop Packet Page Number 37 of 92 6 •Public Improvements •Land Acquisition •Soil Correction •Site Preparation/Demolition • Relocation •Financing Fees/Capitalized Interest •Administrative Costs (10%)E1, Attachment 3Workshop Packet Page Number 38 of 92 7 •Streets and Roads • Utilities •Bridges and Interchanges • Parking •Sidewalks and walkways •Soft costs related to any of the above E1, Attachment 3Workshop Packet Page Number 39 of 92 8 •Public Buildings such as a City Center, Public Safety, Public Works buildings •Culture and Recreation such as parks, community centers, golf courses, etc. •Administration beyond 10% of TIF collections E1, Attachment 3Workshop Packet Page Number 40 of 92 Financing Project Costs •Pay as you go –Developer pays for public improvements –Reimbursed by tax increment –Reimbursement limited to amount of TIF collected •G.O. Tax Increment Bonds –Tax increment pays at least 20% of debt service costs –Obligation to levy for debt issue, if needed –Minimum assessment agreement •Taxable bonds may result 9 E1, Attachment 3Workshop Packet Page Number 41 of 92 10 •Development District •TIF District –TIF Plan •Budget •Geographic boundaries •Purpose –Public Hearing – Certification E1, Attachment 3Workshop Packet Page Number 42 of 92 11 •Same as establishing a new District •Approximate 60 day approval process, which includes: –Notification to County Commissioner –Draft Plan and Fiscal Impact to County and School Board –Publication of hearing notice –City Council public hearing –Submitting documents to County, OSA, DOR E1, Attachment 3Workshop Packet Page Number 43 of 92 12 •That the TIF Plan will afford maximum opportunity, consistent with the sound needs of the City as a whole, for development by private enterprise •That the TIF Plan conforms to general plans for development of the City as a whole •That the project will qualify as a TIF District –Specific criteria for each type of district E1, Attachment 3Workshop Packet Page Number 44 of 92 13 •That the proposed development, in the opinion of the City, would not reasonably be expected to occur solely through private investment within the reasonably foreseeable future –The but/for test: •The proposed development would not occur but/for the use of tax increment financing E1, Attachment 3Workshop Packet Page Number 45 of 92 14 •That the increased market value that could reasonably be expected to occur without the use of TIF would be less than the increase in the market value estimated to result from the proposed development after subtracting the total subsidy provided E1, Attachment 3Workshop Packet Page Number 46 of 92 15 •Proposed three-phase mixed-use development –Phase 1 is complete and includes 50-unit multi-family affordable housing project –Phase 2 is proposed to be a 107-unit 55+ market rate apartment project –Phase 3 is proposed to be an approximately 6,000 square foot commercial building (to be determined) •Construction of phase 1 commenced in 2015, phase 2 is expected to commence in 2017 and phase 3 may be in 2018 E1, Attachment 3Workshop Packet Page Number 47 of 92 16 •In addition to private developer costs, significant public site work and utility improvements are contemplated to be undertaken within the district and surrounding project area •First increment to be received in 2018 •Maximum 26 years of collection –Collection for 25 years after receipt of first increment E1, Attachment 3Workshop Packet Page Number 48 of 92 17 Proposed Budget Modification Amount Estimated Public Costs Private TIF eligible improvements, including demolition, relocation, site improvements/preparation costs, related infrastructure and other eligible improvements 4,016,300 Paygo Note Interest Payments 3,762,715 Public site work/infrastructure costs and Administrative expenses 1,957,000 Interest Incurred on Public Costs 2,244,894 Total 11,980,909 Estimated Sources of Revenue Tax Increment Revenue 11,980,909 E1, Attachment 3Workshop Packet Page Number 49 of 92 Proposed Development Agreement Terms •Phase 1 –83% of increment pledged to developer up to $620,600 –17% retained by City •Phase 2 (proposed) –75% of increment pledged to developer up to $3.9M –25% retained by City •Phase 3 (future) –To be determined, not included at this time 18 E1, Attachment 3Workshop Packet Page Number 50 of 92 19 •City Council public hearing on April 24 to consider Modification to Tax Increment Financing District No. 1-13 •City Council to consider Amendment to the TIF Agreement between City and developer •Developer to commence construction of phase 2 E1, Attachment 3Workshop Packet Page Number 51 of 92 20 Mikaela Huot, Vice President 651-223-3036 Thomas Denaway, Assistant Vice President 651-223-3075 Springsted Incorporated 380 Jackson Street, Suite 300 Saint Paul, MN 55101-2887 E1, Attachment 3Workshop Packet Page Number 52 of 92 MEMORANDUM TO: Melinda Coleman, City Manager FROM: DuWayne Konewko, EEDD/ Parks & Recreation Director Audra Robbins, Recreation Manager DATE: April 10, 2017 SUBJECT: Harvest Community Gardens Introduction Harvest Community Gardens is a community outreach of First Evangelical Free Church in Maplewood. Gardens are available to anyone, without cost, on a first come basis. The gardeners come from many communities around the Twin Cities and are a diverse mixture of cultures and languages. Jon Addington from First Evangelical Free Church is here to present this evening to share the story of this remarkable project and how the church and the City of Maplewood have partnered in the past and plan to do so in the future. Background Harvest Community Gardens is an area of over 1,100 community garden plots established on land about a block away from the First Evangelical Free Church Building. In addition to the garden plots, garden events are offered and are translated, as needed, between English, Spanish, Hmong and Karen. Events include a season opening orientation, a midsummer picnic and gardening workshops throughout the season. The gardening workshops are organized in cooperation with the City of Maplewood and Ramsey County Master Gardeners. Harvest Community Gardens is coordinated by volunteers and financed by donations. Recommendation This report is informational only, no action required. Budget Impact None. Attachments 1. Harvest Community Gardens Presentation E2 Workshop Packet Page Number 53 of 92 Harvest Community GardensOutreach of First Evangelical Free ChurchMaplewoodE2, Attachment 1 Workshop Packet Page Number 54 of 92 E2, Attachment 1 Workshop Packet Page Number 55 of 92 Harvest Gardens - the Journey2009Informal agreements to use acreage to gardenHmong Minnesota Senior CenterHmong Hope Community ChurchE2, Attachment 1 Workshop Packet Page Number 56 of 92 E2, Attachment 1 Workshop Packet Page Number 57 of 92 Harvest Gardens - the Journey2010Formally organized3.5 acres/350 plots150 gardenersBuilding a bridge to the communityE2, Attachment 1 Workshop Packet Page Number 58 of 92 E2, Attachment 1 Workshop Packet Page Number 59 of 92 Harvest Gardens - the Journey2011World Relief Minnesota (now Arrive Ministries)Karen Refugee immigrants (from Burma)City of MaplewoodHow can we partner?Giving GardenFeeding the hungryE2, Attachment 1 Workshop Packet Page Number 60 of 92 E2, Attachment 1 Workshop Packet Page Number 61 of 92 Harvest Gardens - the Journey20117 acres/960 plots2 plots/gardener479 gardenersGiving GardenSalvation Army food shelfRamsey County homeless shelterWelcoming the immigrantFeeding the hungryDemonstrating the love of Jesus ChristE2, Attachment 1 Workshop Packet Page Number 62 of 92 E2, Attachment 1 Workshop Packet Page Number 63 of 92 Harvest Gardens - the Journey20129 acres/1160 plots2 plots/gardener625 gardeners20131 plot/gardener2 plots/refugee immigrant1050 gardenersE2, Attachment 1 Workshop Packet Page Number 64 of 92 Harvest Gardens - the JourneySince 20141162 gardeners1 plot/gardenerE2, Attachment 1 Workshop Packet Page Number 65 of 92 Giving Garden4 plots/30’x30’Donations to Food Shelf700 lbs/seasonE2, Attachment 1 Workshop Packet Page Number 66 of 92 Midsummer PicnicE2, Attachment 1 Workshop Packet Page Number 67 of 92 E2, Attachment 1 Workshop Packet Page Number 68 of 92 Gardening SeminarsIn cooperation with the City of MaplewoodE2, Attachment 1 Workshop Packet Page Number 69 of 92 Registration & OrientationE2, Attachment 1 Workshop Packet Page Number 70 of 92 E2, Attachment 1 Workshop Packet Page Number 71 of 92 PollinatorsE2, Attachment 1 Workshop Packet Page Number 72 of 92 WaterE2, Attachment 1 Workshop Packet Page Number 73 of 92 ToolsE2, Attachment 1 Workshop Packet Page Number 74 of 92 E2, Attachment 1 Workshop Packet Page Number 75 of 92 Little Free LibraryE2, Attachment 1 Workshop Packet Page Number 76 of 92 CompostE2, Attachment 1 Workshop Packet Page Number 77 of 92 Garden OpeningE2, Attachment 1 Workshop Packet Page Number 78 of 92 E2, Attachment 1 Workshop Packet Page Number 79 of 92 E2, Attachment 1 Workshop Packet Page Number 80 of 92 E2, Attachment 1 Workshop Packet Page Number 81 of 92 Kid’s ClubE2, Attachment 1 Workshop Packet Page Number 82 of 92 E2, Attachment 1 Workshop Packet Page Number 83 of 92 E2, Attachment 1 Workshop Packet Page Number 84 of 92 E2, Attachment 1 Workshop Packet Page Number 85 of 92 E2, Attachment 1 Workshop Packet Page Number 86 of 92 Harvest Gardens9 Acres 1166 plots, 15’ x 15’3 miles of path2600 stakes6.5 miles of string80 faucetsE2, Attachment 1 Workshop Packet Page Number 87 of 92 Harvest GardensOpen to allNo costFinanced by donationsE2, Attachment 1 Workshop Packet Page Number 88 of 92 Harvest GardensTo build a bridge to the communityTo welcome the immigrantTo feed the hungryTo demonstrate the love of Jesus ChristE2, Attachment 1 Workshop Packet Page Number 89 of 92 E2, Attachment 1 Workshop Packet Page Number 90 of 92 MEMORANDUM TO: Melinda Coleman, City Manager FROM: Paul Schnell, Director of Public Safety/Police Chief DuWayne Konewko, Parks and Recreation Director DATE: April 4, 2017 SUBJECT: Park Ambassador and Youth Outreach Program Concepts Introduction As was requested by Council, staff has been working on and reviewing options for youth outreach. While we are concerned about all youth, we are specifically seeking options that allow City staff to better engage and connect with youth of color. Background Maplewood’s Parks and Recreation Department has been exploring the development of a Park Ambassador volunteer program. These Park Ambassadors would serve as important local park liaisons to City staff. Park Ambassadors also help staff identify issues in neighborhood parks, including problems with amenities, safety or disorder concerns, and can serve as valued neighborhood-based liaisons with Maplewood’s Parks and Recreation Commission. Though not directly related, the Police Department has been focused on developing a Community Ambassador program. Community Ambassadors have been successfully used in St. Paul for several years. St. Paul’s program has resulted in improved relations between youth, police, and local businesses. Importantly, the program often reduces the need for enforcement action because of its focus on proactive engagement and problem-solving. Preliminary goals for Maplewood’s Community Ambassador Program concept include: • Building and fostering community inclusion in support of the City’s racial equity efforts • Providing Maplewood youth access to culturally-specific youth workers • Reducing delinquency and disorderly conduct incidents in and around Maplewood’s retail corridor by proactively engaging youth who regularly visit the area To accomplish the above goals, Community Ambassadors will: • Serve as liaisons with and between youth, police, City staff, and area businesses • Model and implement problem solving despite heightened levels of distrust • Assist officers, parks staff, and retailers mediate issues or problems • Refer youth and their families to culturally appropriate services, as may be needed • Assist officers and other City staff in developing deepened trust and cooperation with and between youth of color and their parents • On an as requested basis, assist supervisory-level personnel debrief youth-police encounters, which escalate to the point of forcible arrest E3 Workshop Packet Page Number 91 of 92 • Assist officers and City staff through conversations about social, cultural, and racial dynamics that are relevant to their work • Provide input to City, retailer, and community-based partner staff on meaningful strategies for meeting the needs of youth, particularly youth of color • Develop and create relationships with Maplewood’s youth, especially historically underserved youth of color, through pro-social youth engagement and community- building efforts. • Serve as liaisons and assist City staff with outreach at Citywide events, such as the July 4th celebration, WOW Events, National Night Out, etc. The current concept plan calls for Community Ambassadors to give particular focus to Maplewood Parks and Ramsey County Parks located in the City, Maplewood Mall, the Maplewood Transit Center, the Ramsey County Library, and other locations where these liaison services could prove beneficial. Both Parks and Police Department staff believe there is considerable benefit in leveraging these Ambassador programs to make them mutually beneficial. Staff are meeting with possible partners and reviewing options for program implementation. The goal is to create a partnership complete with project outcome measures within the next 30 days. We would like to implement the project before the end of this school year with the goal of collecting quantitative and qualitative outcome metrics. Budget Impact As part of the police department’s 2017 budget request, the department was authorized on a one-time basis to utilize salary savings from the military deployment of a Maplewood police officer. The salary savings of $35,000.00 would be used to fund a contract with an outside vendor. Recommendation Discussion only. Attachments None. E3 Workshop Packet Page Number 92 of 92