minhpd 02-08-21 - Laserfiche WebLink

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Director Leininger added that the first step in the process was approval of the development agreements. The second set of ordinances allowed the City to enter and exit the chain of title for these properties. Ordinances 06-2021 and 07-2021 put the actual TIF in place and lays out how the TIF payments will happen. It was clarified that the TIF will run concurrently with the CRA (Community Reinvestment Area) for 15 years and that the TIF will be subordinate to the CRA. The TIF will not take effect until year 16. For the first 15 years, the City and the schools will collect only the base tax. They will not receive any taxes based on the improved value of the property. The operation of the service payments was discussed and clarified. From years 16-30 the service payments are placed into a fund that is created through this ordinance. Later the City will pay back the developer the amount reimbursing them for the costs associated with the development of the site. The purpose of the TIF revenue is to make developers whole or for the developers to get back some of what they have invested in order to build these types of projects. While a TIF is usually used for public improvements, Council set this up to incentivize affordable housing since that it a need in the City. Councilmember Shachner remarked that such incentives are important for the City to offer because we are competing with surrounding communities that offer them. The City has determined that it is a priority to open up new avenues for people to live in the City. In response to a councilmember's question, Director Leininger explained that the timelines within the development agreements are much further out than the actual project schedule. The Spitzer site is currently before the Architecture Board of Review. Director Leininger referred to the dates within the development agreement. Construction at the sites must be complete by 2025. These dates were included as fail-safes. Something would have to go quite wrong for the project to get pushed out that far. Alex Solove stated that his company is aiming to break ground on both projects this year. Councilmember Rader asked for assurance that Solove has the financial backing to execute these projects as planned. Mr. Solove responded that while these projects will continue to evolve until there is a"shovel in the ground,"that the projects are starting to pull significant triggers and getting far along. He also added that the project design with a small commercial component is less risky than a large commercial endeavor. The committee reviewed the amount of affordable housing this will create. The CRA requires that 20% of the project be affordable housing for 15 years which breaks down to 32 units at the Barry site and 24 at Spitzer. For the TIF to be there at year 16 the developer must maintain the affordable housing the entire time. 2