Economic Development Authority- [Erik Thorvig, Economic Development Coordinator]
Title
RESOLUTION APPROVING TIF DEVELOPMENT AGREEMENT WITH MORTENSON CONSTRUCTION FOR CROWN IRON WORKS PROJECT
Background
As part of the development of a new TIF District, a development agreement with Mortenson Construction must also be approved outlining specific requirements of the developer in order to ensure project completion and performance. In general the development agreement highlights are:
• Developer shall commence construction by 8/31/2018 and complete construction by 5/31/19.
• Developer shall construct project to be consistent with all approved plans.
• EDA shall reimburse the developer for development costs by issuance of a TIF note in the amount of $713,756.
• EDA shall reimburse the developer $486,244 with existing pooled TIF funds. This reimbursement shall occur when the project is complete.
• Crown Iron Works is required to create 23 full-time equivalent jobs at an average salary of at least $90,000 per year, excluding benefits, within two years of the project completion.
• Crown Iron Works shall continue operations at the site for at least 5 years.
Recommendation
Staff recommends approval of the development agreement between Mortenson Construction and the Blaine Economic Development Authority.
Body
WHEREAS, there has heretofore been established, pursuant to Minnesota law, Development District No. 1 of the City of Blaine, Minnesota (the “City”) and the Housing and Redevelopment Project No. 1 of the Housing and Redevelopment Authority in and for the City of Blaine, Minnesota (the “HRA”) which have been merged and designated as the Blaine Economic Development Project (as amended from time to time, the “Project Area”), control of which has been delegated to the EDA; and
WHEREAS, the City and the EDA have established within the Project Area, Tax Increment Financing District No. 1-20 (An Economic Development District) (the “TIF District”) pursuant to Minnesota Statutes, Sections 469.174 to 469.1794, as amended (the “TIF Act”); and
WHEREAS, in order to achieve the objectives of the Project Plan (as hereinafter defined) and particularly to make the land in the Project Area available for redevelopment and development by private enterprise in conformance with the Project Plan, the EDA has determined to assist the Developer with the financing of certain costs of certain Minimum Improvements (as hereinafter defined) to be constructed within the TIF District as more particularly set forth in this Agreement; and
WHEREAS, the EDA believes that the development and construction of the Minimum Improvements, and fulfillment of this Agreement are vital and are in the best interests of the City, the health, safety, morals and welfare of residents of the City, and in accordance with the public purpose and provisions of the applicable state and local laws and requirements under which the Minimum Improvements has been undertaken and is being assisted; and
WHEREAS, the requirements of the Business Subsidy Law, Minnesota Statutes, Section 116J.993 through 116J.995, as amended, apply to this Agreement; and
WHEREAS, the EDA has adopted criteria for awarding business subsidies that comply with the Business Subsidy Law, after public hearings for which notice was published; and
WHEREAS, the Board of Commissioners has approved this Agreement as a subsidy agreement under the Business Subsidy Law.
NOW, THEREFORE, BE IT RESOLVED, that the Blaine Economic Development Authority hereby approves the development agreement with Crown Iron Works and Mortenson Construction and hereby give the authority for the president and executive director to execute all documents.
PASSED by the Blaine Economic Development Authority of this 12th day of July, 2018.