HomeMy WebLinkAboutResolution 078-2008 Resolution No. 78-08
Resolution Giving Approval To Tax Increment District Number Four Project, Giving
Approval To The Issuance Of Tax Incremental Revenue Bonds To Finance The Project
And Authorizing The Sale Of Said Tax Incremental Revenue Bonds And The Terms
Thereof.
NOW, THEREFORE, BE IT RESOLVED AND RESOLVED by the City of Brookings
as follows:
SECTION 1. AUTHORITY, FINDINGS,AUTHORIZATION.
1.01 Authority. The City is authorized to issue its Tax Incremental Revenue Bonds, Series 2008
to finance project costs pursuant to Section 11-9-33 of the South Dakota Codified Laws. Pursuant
to Chapter 11-9 of the South Dakota Codified Laws (the "Act"), the City proposes to issue tax
incremental revenue bonds (as herein authorized, the "Tax Incremental Revenue Bonds" or the
"Bonds") to finance a portion of the Project costs. The City is authorized by the Tax Incremental
Act to pledge a special fund into which the City will deposit the tax increment (as defined by the
Act).
1.02 Findings. The City Council hereby finds and determines as follows:
(a) It is necessary to provide incentives for the development of certain real property located in
the City for affordable housing;
(b) The City intends to provide financing of Sieler Housing Development which will be
constructed to meet the needs of low to moderate income families located in the City of
Brookings in connection with Tax Increment District Four the plan on file with the City
Finance Officer and open to public inspection (the "Project");
(c) The Tax Incremental Revenue Bonds authorized hereby are being issued to pay costs of
Project, which have not been incurred or paid as of the date hereof and/or which the City
has heretofore declared its intention to finance with bond proceeds and for which the City
has no other available means or source of financing. The cost of the Project will not exceed
$475,000,including capitalized interest;
(d) It is in the best interests of the City to authorize the borrowing of funds to pay a portion of
the costs of the Project by authorizing and issuing the Bonds, consistent with the terms
approved hereby for an aggregate sum not in excess of the amount of$475,000;and
(e) That the Tax Incremental Revenue Bonds are payable only solely out of the special fund
created herein and that it does not constitute a general indebtedness of the City or a charge
against its general taxing power.
1.03 Authorization to issue the Bonds. It is hereby determined to be necessary and in the best
interests of the City and its inhabitants that this City Council authorize,issue and sell the Bonds (the
"Bonds") in order to finance a portion of the cost of the Project. The Mayor, City Manager and
City Finance officer are authorized to negotiate the sale and terms of the Bonds subject to the
limitations of the law and this Resolution. The Bonds may be issued by the City without an election
pursuant to SDCL§11-9-34.
SECTION 2. SALE, BOND PURCHASE AGREEMENT AND OFFICIAL
STATEMENT.
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2.01 Sale. The Bonds authorized by this Resolution shall be issued in an aggregate principal
amount not exceeding $475,000 and shall be privately placed due to the unique nature. The Bonds
will bear interest at a rate or rates per annum and will mature over a period set forth in the bond
purchase agreement or similar document. The City intends to sell the Bonds to a local or regional
financial institution, underwriters or private individual or individuals (the "Purchaser").
2.02 Bond Purchase Agreement. The execution of a bond purchase agreement or similar
document setting forth the final terms of the Bonds is hereby approved and authorized. The
execution of said document by the Mayor and City Finance officer shall be conclusive evidence of
such agreement and shall be binding upon the City.
SECTION 3. TERMS OF BONDS.
3.01 Date.Amount,Maturities and Interest Rates. The Bonds shall be dated in calendar year
2008. The principal amount of the Bonds shall not exceed the lesser of$475,000 or any statutory or
constitutional debt limitation. The term of the Bonds shall not exceed 20 years. The weighted
average interest rate on the Bonds shall not exceed 8.00%.
3.02 Form of Bonds. The Bonds shall be prepared in substantially the form on file with the City
Finance officer and open to public inspection.
3.03 Execution. The Bonds shall be signed by the manual or facsimile signatures of the Mayor
and City Finance officer of the City and countersigned by the manual or facsimile signature of an
attorney resident in the State of South Dakota and in case any officer whose signature shall appear
on any Bond shall cease to be such officer before the delivery of such Bond, such signature shall
nevertheless be valid and sufficient for all purposes, the same as if such officer had remained in
office until delivery.
3.04 Redemption. Terms of optional or mandatory redemption shall be set by negotiation with
the purchaser of the Bonds.
(i) Appointment of Initial Registrar. The City hereby appoints the Finance officer, as
Bond registrar, transfer agent and paying agent(the "Registrar") for the Bonds.
3.05 Authentication and Delivery. No Bond shall be valid or obligatory for any purpose or
entitled to any security or benefit under this Resolution unless and until a certificate of
authentication on such Bond has been duly executed by the Registrar by the manual signature of its
authorized representative. Certificates of authentication on different Bonds need not be signed by
the same representative. The executed certificate of authentication on each Bond shall be conclusive
evidence that it has been authenticated and delivered under this Resolution. When the Bonds have
been so prepared, executed and authenticated, the City Finance officer shall deliver the same to the
Purchaser thereof upon payment of the purchase price in accordance with the provisions of the
Bond Purchase Agreement and the Purchaser shall not be obligated to see to the application of the
purchase price. Upon delivery of the Bonds to the Purchaser, the City Finance Officer shall file with
the Secretary of State, on the form provided by the Secretary of State, the information required by
SDCL, Section 6-8B-19.
SECTION 4. SECURITY PROVISIONS; FUNDS AND ACCOUNTS AND OTHER
COVENANTS AND DETERMINATIONS.
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4.01 Pledge Tax Increments. Pursuant to the Act, the City shall receive Tax Increments. All Tax
Increments shall be placed in the Tax Incremental Revenue Bond Fund. The Tax Increment is
irrevocably pledged and appropriated to the payment of the Bonds. For purposes of this
Resolution, "Outstanding Bonds" shall mean these Bonds and any parity lien bonds herebefore or
hereafter issued pursuant to this Resolution. The Tax Incremental Revenue Bond Fund shall be
used and applied only in the manner and order hereinafter set forth. The holders of the
Outstanding Bonds shall have a lien against the Tax Incremental Revenue Bond Fund for payment
of the principal and interest and may either at law or in equity protect and enforce the lien.
4.02 Tax Incremental Revenue Bond Fund. The City Finance officer is hereby authorized and
directed to establish and shall maintain a special fund, the Tax Incremental Revenue Bond Fund, as
a separate and special fund in the financial records of the City until all Bonds issued and made
payable therefrom, and interest due thereon, have been duly paid or discharged. All collections of
the Tax Increments shall be credited, as received, to the Tax Incremental Revenue Bond Fund.
Within the Tax Incremental Revenue Bond Fund are various separate accounts to be maintained by
the City.
(a) Construction Account. There is hereby created and established as an account of the Tax
Incremental Revenue Bond Fund, a "Construction Account". There shall be credited to the
Construction Account the proceeds from the sale of the Bonds remaining after payment of
the expenses of issuing the Bonds. All moneys credited to the Construction Account shall
be applied solely to the payment of the costs of the Project or reimbursement therefore. For
the purposes of this Resolution, "costs of the Project" shall include costs of acquiring,
construction, and installing the Project including cost of capitalized interest, labor, services,
materials and supplies, financial, architectural, engineering, legal, accounting and other
professional expenses relating to the Project, the costs of acquisition or properties, rights,
easements, or other interest in properties, insurance premiums, and the costs of publishing,
posting or mailing notices in connection with the Project. All sums derived from the
investment of moneys in the Construction Account shall remain in and become part of such
account. Upon completion of the Project and when all costs of the Project have been paid,
any balance remaining in the Construction Account shall be credited to the Principal and
Interest Account hereinafter established. All public project costs shall be bid in accordance
with South Dakota law.
(b) Principal and interest Account. There is hereby created and established as an account of the
Tax Incremental Revenue Bond Fund, a "Principal and Interest Account." Immediately
upon delivery of the Bonds, there shall be credited to the Principal and Interest Account the
amount of any accrued interest received from the Purchaser. Periodically, as needed there
shall be withdrawn from the Tax Incremental Revenue Bond Fund and credited to the
Principal and Interest Account an amount which will equal at least the next principal and
interest payment. In all events there shall be credited to the Principal and Interest Account
amounts sufficient to pay the principal of and interest on the Outstanding Bonds as the
same become due.
(c) Subordinate Lien Bonds. After making the above required payments, any remaining Tax
Increment shall be used for the payment of the principal of and interest on any additional
Tax Incremental Revenue Bonds having a lien which is subordinate to the lien of the
Outstanding Bonds, and for a reserve fund as additional security for the payment of such
subordinate lien bonds.
4.03 Additional Debt.
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(a) No additional Bonds shall be issued, be made payable from the Tax Incremental Revenue
Fund or Tax Increments which is prior to or superior to the lien of the Bonds authorized
herein.
(b) Nothing in this Resolution shall be construed in such mariner as to prevent the issuance by
the City of additional bonds payable from the Tax Increment and constituting a lien upon
the Tax Increment and the Tax Incremental Revenue Fund equal to or on a parity with the
lien of the Bonds authorized herein (such additional bonds being referred to herein as
"Additional Bonds"), provided that it is feasible and the Bond Holder agrees in writing.
(c) Nothing herein shall prevent the City from issuing Bonds payable from the Tax Increment
or Tax Incremental Revenue Bond fund or having a lien thereon which is junior and
subordinate to the lien of the Bonds authorized herein. The City may incur expenses in
connection with the Tax Incremental District Number Four which shall be reimbursed
through the tax increment. Said obligations shall be junior and subordinate to the Bonds
whether evidenced by an accounting notation or instrument of indebtedness.
4.04 Pledge of State of South Dakota. Pursuant to SDCL 11-9-39.1, the State of South Dakota
does pledge to and agree with the holders of any issued under 11-9 that the state will not alter the
rights vested in the bond holders until such bonds, together with the interest thereon, with interest
on any unpaid installments of interest, and all costs and expenses in connection with any action or
proceeding by or on behalf of such holders, are fully met and discharged.
4.05 Covenants of the City. The City hereby irrevocably covenants and agrees with each and
every holder of the Bonds that so long as any of the Bonds remain outstanding:
(a) It will not amend or repeal the Tax Increment or the allocation of revenues thereof to the
Tax Incremental Revenue Bond Fund, or in any way that would adversely affect the amount
of Tax Incremental Revenues which would otherwise be collected and deposited to the Tax
Incremental Revenue Bond Fund.
(b) It will administer, enforce, and collect, or cause to be administered, enforced or collected,
the real property taxes and shall take such necessary action to collect delinquent payments in
accordance with law.
(c) It will keep or cause to be kept such books and records showing the proceeds of the Tax
Incremental, in which complete entries shall be made in accordance with standard principles
of accounting, and any owner of any Bond shall have the right at all reasonable times to
inspect the records and accounts relating to the collection and receipts of such Tax
Incremental.
(d) In the event the real property taxes of the City is replaced and superseded by the state
collected-locally shared tax or taxes, or is replaced and superseded in some other manner
form other source or sources, the revenues derived by the City from the replacement source
or sources, as received by the City shall be appropriated in the same manner as if the City
had levied and imposed a real property tax. From and after the date of a replacement, the
Outstanding Bonds shall have a first and prior lien, but not necessarily an exclusive lien,
upon such replacement revenues to the extent therein specified.
4.06 Defeasance. When all the Bonds issued have been discharged as provided in this section, all
pledges, covenants, and other rights granted by this Resolution to the registered owners of the
Bonds shall cease. The City may discharge its obligations with respect to any Bonds which are due
on any date by providing to the Paying Agent on or before that date a sum sufficient for the
payment thereof in full; or, if any Bond should not be paid when due, it may nevertheless be
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discharged by providing to the Paying Agent a sum sufficient for the payment thereof in full with
interest accrued to the date of such deposit. The City may also discharge its liability with reference
to all Bonds which are called for redemption on any date in accordance with their terms by
depositing funds with the Paying Agent on or before that date in accordance with their terms by
depositing funds with the Paying Agent on or before that date, in an amount equal to the principal,
interest, and premium, if any, which are then due thereon, provided that notice of such redemption
has been duly given. The City may also at any time discharge this issue of Bonds in its entirety,
subject to the provisions of law now or hereafter authorizing and regulating such action, by
depositing irrevocably in escrow, with a bank qualified by law as an escrow agent for this purpose,
cash or United States government obligations which are authorized by law to be so deposited,
bearing interest payable at such times and at such rates and maturing on such dates as shall be
required to provide funds (without an reinvestment) sufficient to pay all principal, interest and
premiums, if any, to become due on all Bonds on and before maturity, or, if a Bond has been duly
called for redemption, on or before the designated redemption date.
4.07 Certification of Proceedings. The officers of the City are authorized and directed to prepare
and furnish to the purchasers of the Bonds certified copies of all proceedings and records of the
City relating to the authorization and issuance of the Bonds and such other affidavits and certificates
as may reasonably be required to show the facts relating to the legality and marketability of the
Bonds as such facts appear from the officer's books and records or are otherwise known to them.
All such certified copies, certificates and affidavits, including any heretofore furnished, shall
constitute representations of the City as to the correctness of the facts recited therein and the action
stated therein to have been taken.
SECTION 5. TAX MATTERS; CERTIFICATION OF PROCEEDINGS AND
MISCELLANEOUS.
5.01 Tax Matters. The interest component on the Bonds shall be taxable.
SECTION 6. INTERPRETATION, AUTHORIZATION OF OFFICERS AND
RESOLUTION CONSTITUTES CONTRACT.
6.01 Interpretation. If any section, paragraph, clause or provision of this Resolution shall for any
reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section,
paragraph, clause or provision shall not affect any of the remaining provisions of this Resolution.
6.02 Authorization of Officers. The Mayor, officers of the City and the City Finance Officer of
Brookings are authorized and directed to prepare and furnish to the purchasers of said Bonds, and
to the attorneys passing on the legality of said Bond issue, copies of all proceedings relating to
Bonds and other certificates and affidavits showing the facts affecting the legality thereof as shown
by the books and records of the City under their custody and control or as otherwise known to them
and such copies, certificates and affidavits, including any heretofore furnished, shall constitute
representations of the City as to the facts therein recited.
6.03 The officers of the City are hereby authorized and directed to take all other action necessary
or appropriate to effectuate the provisions of this Resolution , including without limiting the
generality of the foregoing, the printing of the Bonds, and the execution of such certificates as may
reasonably be required by the Purchaser, including, without limitation, certification relating to the
signing of the Bonds, the tenure and identity of the City's officials, the exemption of interest on the
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Bonds from federal income taxation, the receipt of the Bond purchase price and, if in accordance
with the facts, the absence of litigation affecting the validity thereof.
6.04 Resolution Constitutes Contract. After the Bonds have been issued, this Resolution shall
constitute a contract between the City and the holder or holders of the Bonds, and shall be and
remain irrepealable and unalterable until the Bonds and the interest accruing thereon shall have been
duly paid, satisfied and discharged.
6.05 Rules of Construction. If any section, paragraph, clause or provision of this Resolution shall
for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such
section, paragraph, clause or provision shall not affect any of the remaining provisions of this
Resolution. The title or caption of each paragraph are for convenience purposes only and do not
define scope or intent of paragraph.
CITY OF BROOKINGS
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• 4,, .%-z ''........---:ott 10. Munsterman,Mayor
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ornes, City Clerk
Adopted: September 9, 008
Approved: September 9,2008
Published: September 12, 2008
The motion for adoption of the foregoing Resolution was made by Council Member Bartley, duly
seconded by Council Member Reed, and upon vote being taken thereof, the following voted YEA:
Munsterman,Whaley,Brunner, Reed, Bartley, and Bezdichek.
And the following voted NAY: None
Whereupon said Resolution was declared duly passed and adopted.
C --• 0- II ;1.0' 0 KINE -----4
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, 1 1 ;,1144 cott to. Munsterman,Mayor
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14:Pr". ornes, City Clerk
STATE OF SOUTH DAKOTA )
SS
COUNTY OF BROOKINGS )
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I, the undersigned, being the duly qualified and City Clerk of the City of Brookings, South
Dakota, do hereby certify that the attached and foregoing is a full, true and complete transcript of
the Minutes of a meeting of the City Council held on the 9th day of September, 2008, insofar as the
original meeting relates to proceedings for the Resolution Authorizing the Sale of Said Tax
Incremental Revenue Bonds.
WITNESS my hand and official seal of this said City this gth day of September 2008.
Or/
an Thornes, City Clerk "01
City of Brookings, South Dakota tPA,
7
1
TAX INCREMENTAL DISTRICT
NUMBER FOUR,
CITY OF BROOKINGS
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TAX INCREMENTAL PROJECT PLAN
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Section 1. Introduction and Purpose. 1
Section 2. General Definitions. 1
Section 3. Tax Increment District Legal Description. 4
Section 4. Listing of Kind, Number, Location and detailed costs of proposed public
works and improvements 5
A. Costs of Public Works or Improvements 5
Section 5. Detailed Project Costs. 6
Section 6. Fiscal Impact Statement. 6
Section 7. Method of Financing, timing of costs and methods of payment 6
Section 8. Maximum Amount of Note, Bond or other Monetary Obligation. 6
Section 9. Duration of Tax Incremental Plan 7
Section 10. Estimated Impact of Tax Increment Financing on Revenues of Taxing
Jurisdictions 7
Section 11. The legal description of the eligible property is provided in Attachment 1. 7
Section 12. Statement of Displacement and Relocation. 7
Section 13. Changes to the City of Brookings master plan, map, buildings codes and City
ordinances. 7
Section 14. List of Estimated Non-project Costs 7
Section 15. Impact on School District. 8
ATTACHMENTS 8
LIST OF SCHEDULES 8
Feasibility Study 23
Feasibility Study 25
BLIGHT STUDY 26
Existing Conditions 28
Background and Definition of the Study Area 28
Existing Land Use 28
Vacant and Underutilized Properties 28
Public Improvements 28
CONCLUSIONS 28
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Section 1. Introduction and Purpose.
The purpose of this plan, to be implemented by the City of Brookings, is to satisfy the
requirements for a Tax Incremental District Plan Number Three, City of Brookings as specified in
SDCL Chapter 11-9. There are 11 mandated requirements of the plan, each to be addressed in
this plan. The principal purpose of the plan is to define eligible property and to define a tax
increment plan for funding eligible activities of a functionally obsolete and blighted area of the
City.
Section 2. General Definitions.
The following terms when found in this plan shall have the meaning set forth in this section 2
unless the context clearly indicates otherwise.
"Blighted" means property that meets any of the following criteria:
I. Any area, including slum area, in which the structures, buildings, or improvements, by
reason of:
(1) dilapidation, age, or obsolescence;
(2) inadequate provisions for ventilation, light, air,sanitation,or open spaces;
(3) high density of population and overcrowding;
(4) the existence of conditions which endanger life or property by fire and other
causes; or
(5) any combination of such factors;
are conducive to ill health, transmission of disease, infant mortality, juvenile
delinquency, or crime, and which is detrimental to the public health, safety, morals,
or welfare, is a blighted area.SDCL§ 11-9-9
II.Any area which by reason of:
(1) the presence of a substantial number of substandard, slum, deteriorated, or
deteriorating structures;
(2) predominance of defective or inadequate street layouts;
(3) faulty lot layout in relation to size,adequacy,accessibility,or usefulness;
(4) unsanitary or unsafe conditions;
(5) deterioration of site or other improvements;
(6) diversity of ownership,tax, or special assessment delinquency exceeding the fair
value of the land;
(7) defective or unusual conditions of title;
(8) the existence of conditions which endanger life or property by fire and other
causes;or
(9) any combination of such factors;
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City of Brookings
Tax Increment Distinct Number Four
substantially impairs or arrests the sound growth of a municipality, retards the
provision of housing accommodations, or constitutes an economic or social liability
and is a menace to the public health, safety, morals, or welfare in its present
condition and use, is a blighted area. SDCL§ 11-9-10
III. Any area which is predominantly open and which because of obsolete platting,
diversity of ownership, deterioration of structures or of site improvements, or
otherwise, substantially impairs or arrests the sound growth of a municipality, is a
blighted area. SDCL§ 11-9-11.
"City of Brookings" means Brookings, South Dakota, a home rule city.
"Council" means the City Council of the City of Brookings.
"Department of Revenue" means the South Dakota Department of Revenue.
"Economic Development" means all powers expressly granted and reasonably inferred
pursuant to SDCL 9-54.
"Fiscal year" means that fiscal year of the City of Brookings.
"Generally Applicable Taxes" shall have the same meaning as set forth in 26 CFR § 1.141-
4(e).
"Governing Body" means the City Council.
"Infrastructure Improvements" means a street, road, sidewalk, parking facility, pedestrian
mall, alley, bridge, sewer, sewage treatment plant, property designed to reduce, eliminate, or
prevent the spread of identified soil or groundwater contamination,drainage system,waterway,
waterline, water storage facility, rail line, utility line or pipeline, or other similar or related
structure or improvement, together with necessary easements for the structure or
improvement, for the benefit of or for the protection of the health, welfare, or safety of the
public generally.
"Municipality"any incorporated City in this state.
"Planning commission" means the city planning commission.
"Plan" means this Project Plan.
"Project Costs" " means any expenditure or monetary obligations by the City of Brookings,
whether made, estimated to be made, incurred or estimated to be incurred, which are listed in
Section 4.1. Project costs will include any costs incidental thereto but diminished by any
income, special assessments, or other revenues, other than tax increments, received, or
reasonably expected to be received, by the City of Brookings in connection with the
implementation of this Plan.
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City of Brookings
Tax Increment Distinct Number Four
"Project Description" means a public works project providing infrastructure to construct
affordable houses in Brookings.
"Project Plan" means the plan required by SDCL§ 11-9-13.
"Public Works" means the acquisition by purchase or condemnation of real and personal
property within the tax incremental district and the sale, lease, or other disposition of such
property to private individuals, partnerships, corporations, or other entities at a price less than
the cost of such acquisition which benefit or further the health, safety, welfare and economic
development of the City.
"Taxable property" all real taxable property located in a tax incremental district;
"Tax increment valuation" is the total value of the tax incremental district minus the tax
incremental base pursuant to§ 11-9-19.
"Tax Incremental District" or "TID" a contiguous geographic area within a City defined and
created by resolution of the governing body and named City of Brookings Tax Incremental
District Number Four;
"Tax Increment Law" means South Dakota Codified Laws Chapter 11-9.
{Remainder of Page Left Blank}
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City of Brookings
Tax Increment Distinct Number Four
Section 3. Tax Increment District Legal Description.
The real property to be located with in the Tax Increment District is shown in Diagram 1
below and legally described as:
Description: the east 610 feet of the west 1,110 feet of the south 640 feet of the
north 1,150 feet in the SE 1/4 of Section 35-T110N-R5OW (unplatted land north of
Cardinal Drive in Hunter's Ridge Addition)
Diagram 1.
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--------qfPr lAss t., 4.44,LOT s LOT 7 ILOT 3
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OT 24 - s
LOT 23
111M1R5 ...OW _i LOT
LOT 3 LOT a eLK, Lot 22 LOT 21 LOT 20 LOT It WT 1e LOT 2
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Ur"_.,LOT 12 LOT 12 LOT 14(Or T!Lot N 107 17 I 202 1
LOT r LOTTO II!
HUNTERS 17021 0040
TED BOUNDARY 14
LEGAL: East 610 feet of the vest 1,110 feet of the south
640 feet of the north 1.150 feet in the SE 1/4 of
NORTR Section 35-T110N-R50W
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City of Brookings
Tax Increment Distinct Number Four
Section 4. Listing of Kind, Number, Location and detailed costs of proposed
public works and improvements.
In order to implement the provisions of SDCL Chapter 11-9, the following are project costs
and expenditures made or estimated to be made and the monetary obligations incurred or
estimated to be incurred by the City. The Project costs includes capital costs, financing costs,
real property assembly costs, professional fee costs, imputed administration costs, relocation
costs, organizational costs and discretionary costs, plus any costs incidental thereto, diminished
by any income, special assessments, or other revenues, other than tax increments, received, or
reasonably expected to be received, by the City.
The City is working to develop an economic and competitive base to benefit the City and the
State as a whole. All the project costs are found to be necessary and convenient to the creation
of the tax incremental district and the implementation of the Tax Increment District. The
project constitutes a proper public purpose of the City. The City shall enter into all contracts in
accordance with South Dakota bid laws.
A. Costs of Public Works or Improvements
In accordance with SDCL 11-9-13(1) & (3)the following is the kind, number, location and
dollar amount of estimated project costs.
PROJECT COSTS LOCATION NUMBER
Capital Costs
Public Works $377,000 Public Right of See
way Schedule 1
Public Improvement
Buildings
Structures
'
Permanent Fixtures
Demolition of existing buildings
Alteration of Existing Buildings
Remodeling of existing buildings
Repair of existing buildings
Acquisition of equipment
Clearing and grading of land Public Right of See
way Schedule 1
Capitalized interest $77'000 Public Right of See
way Schedule 1
Financing Costs
Financial Advisor $6'500
Origination Fee $9,500
Reserve
Real Prop rty Assembly
Professional service costs
'5 '
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City of Brookings
Tax Increment Distinct Number Four
Architectural
Planning
Engineering
Legal $5,000
Services
Imputed administrative costs
Relocation Costs
Organizational costs
Environmental impact studies
Other studies
Informational meetings
Discretionary costs/Contingency
TOTAL $475,000
Any expenditure made beyond the fifth anniversary of the creation of the Tax Increment District
would require an amendment of this plan under SDCL§11-9-23.
Section 5. Detailed Project Costs.
Attached as Schedule 1 is a detailed list of estimated project costs. No expenditure for
project costs is provided for more than five years after the district is created.
Section 6. Fiscal Impact Statement.
Attached as Schedule 3 is the Fiscal Impact Statement on other taxing districts found within
the Tax Increment District, both until and after the bonds are repaid.
Section 7. Method of Financing,timing of costs and methods of payment.
Project costs shall be paid by the proceeds of tax incremental revenue bonds, notes or other
monetary obligation. There shall be no advances by the City. The City may reimburse for
employee time from the tax increments at the end of the plan after payment of all bonds.
Section 8. Maximum Amount of Note,Bond or other Monetary Obligation.
The maximum amount of bonded indebtedness shall depend on the anticipated revenues
from the tax increment and is anticipated not to exceed $475,000.00 or such lesser amount as
may be feasible with the estimated revenue generated by the Tax Increment District.
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City of Brookings
Tax Increment Distinct Number Four
Section 9. Duration of Tax Incremental Plan
The duration of the plan will extend to the number of years it will take for the retirement of
bonded indebtedness except that the plan duration shall not exceed 20 years from the date of
creation of the District.
Section 10. Estimated Impact of Tax Increment Financing on Revenues of
Taxing Jurisdictions
The site will generate taxes to the local jurisdictions at the current level of development on
the property. All taxing districts shall receive that base which will be the value set for 2008
taxable payable in 2009. The new tax revenues will be available to the taxing jurisdictions 20
years after the development is completed or earlier if the actual collections are greater than
anticipated. Schedule 3 details the tax capture implications to each of the local taxing
jurisdictions.
Section 11. The legal description of the eligible property is provided in
Attachment 1.
A general list of real property improvements subject to property tax at the site is listed in
Attachment 2.
Section 12. Statement of Displacement and Relocation.
No residents or families will be displaced by the project.There are no families or persons
residing on the premises. Therefore, no relocation plan is needed.
Section 13. Changes to the City of Brookings master plan,map, buildings codes
and City ordinances.
The City has made no changes in the master plan, map, building codes and City ordinances
as indicated on Attachment 3.
Section 14. List of Estimated Non-project Costs.
Developer Improvements Dollar Amount of Improvements
Non Project- Housing Improvements 32 affordable homes
-7-
I
City of Brookings
Tax Increment Distinct Number Four
Section 15. Impact on School District.
The school districts will receive the taxes on the base value of the parcels within the District
and the taxes to be raised on the tax incremental value will be used to repay the bonds for the
project improvements for a maximum of a 20-year period. After the repayment of the bonds,
the school district will receive their proportionate share of tax dollars for the base value and the
tax incremental value.
The taxing entities located within the District may be required to raise an additional levy for
revenue loss from the formation of the District.
ATTACHMENTS
ATTACHMENT 1 Map and Legal Description and existing uses and conditions
ATTACHMENT 2 LIST of Real property Improvement and uses
ATTACHMENT 3 Map of proposed changes in zoning ordinances
LIST OF SCHEDULES
SCHEDULE 1 Detail of Project Costs
SCHEDULE 2 Estimated Captured Taxable Values
SCHEDULE 3 Revenues from Capturable Taxable Value by Local Jurisdiction
SCHEDULE 4 Schedule According to Agreement
-8-
t
City of Brookings
Tax Increment Distinct Number Four
ATTACHMENT 1
Description: the east 610 feet of the west 1,110 feet of the south 640 feet of the
north 1,150 feet in the SE 1/4 of Section 35-T110N-R5OW (unplatted land north of
Cardinal Drive in Hunter's Ridge Addition)
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City of Brookings
Tax Increment Distinct Number Four
MAP
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M I 118.001 I 118.001 WAX OOr WAX'4'
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® TID BOUNDARY I4
LEGAL: East 610 feet of the vest 1,110 feet of the south
NORTH 640 feet of the north 1,150 feet in the SE 1/4 of
Section 35-T110-R50H
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4 T
City of Brookings
Tax Increment Distinct Number Four
ATTACHMENT 2
(List of Real Property Improvements)
The real property improvements include:
Description Amount
Structures(32*$160,312.50) 5,130,000
Site Work& Improvements 475,000
TOTAL 5,605,000.00
The Improvements shall be located in the real property described in Attachment 1 and is the highest
and best use for the real property.
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, A ,
City of Brookings
Tax Increment Distinct Number Four
ATTACHMENT 3
(ZONING CHANGES)
The following map indicates that there the property is currently zoned residential and that no zoning
changes will take place.
itromm sear SOUTH
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TIA BOUNDAaY 04
LEGAL: East 610 feet of the west 1,110 feet of the south
640 feet of the north L,150 feet in the SE L/4 of
NORTH Section 15-T110N-R50W
Property in gray is currently zoned R-2 and is not no changes to the zoning are required.
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, k
City of Brookings
Tax Increment Distinct Number Four
SCHEDULE 1-"DETAIL OF PROJECT COSTS"
Item Std.Bid
No. Item Item Description Approx Qty _ Unit Unit Bid Price Amount Bid
GRADING/STREET IMPROVEMENTS
1 9.0010 Mobilization 1 LS $20,000.00 $20,000.00
2 120.0010 Unclassified Excavation 3340 CY $4.50 $15,030.00
3 120.0100 Unclassified Excavation, Digouts 40 CY $4.50 $180.00
4 250.0020 Incidental Work,Grading 1 LS $2,500.00 $2,500.00
5 250.0040 Incidental Work,Utilities 1 LS $1,000.00 $1,000.00
6 120.0600 Contractor Furnished Borrow 3300 CY $8.00 $26,400.00
7 230.0010 Placing Topsoil 6450 CY $1.80 $11,610.00
8 230.0300 Salvage Topsoil 6450 CY $1.80 $11,610.00
9 260.1010 Base Course 1650 Ton r $9.50 $15,675.00
10 320.1200 Asphalt Concrete Composite 950 Ton $56.00 $53,200.00
11 380.4010 6"PCC Fillet Section 50 SY $50.00 $2,500.00
12 650.7000 Concrete Curb&Gutter Type SF66 2300 LF _ $12.00 $27,600.00
13 650.8000 Concrete Valley Gutter 6"Thick 34 SY $60.00 $2,040.00
14 SPECIAL Silt Fence or Silt Ditch 730 LF $3.00 $2,190.00
15 730.0100 Cover Crop Seeding 8.0 Bu $150.00 $1,200.00
16 734.6001 Temporary Vehicle Tracking Control 1 Each $1,000.00 $1,000.00
17 734.6006 Concrete Washout Area 1 Each $400.00 $400.00
SANITARY IMPROVEMENTS
18 260.7010 Trench Stabilization Material 20 Ton 10.00$ $200.00
19 950.0102 8"Sanitary Sewer Pipe 8'to 10'Deep 622 LF 36.00$ $22,392.00
20 950.2000 8"Sanitary Sewer Pipe Bedding Material 622 LF 4.00$ $2,488.00
21 950.4002 48"Manhole 8'-10'Deep 2 Each 2,500.00$ $5,000.00
22 950.4802 8"Boots For Manhole 4 Each 113.00$ $452.00
23 SPECIAL Sanitary Service Excavating&Backfilling 1176 LF 12.00$ $14,112.00
4"Sanitary Sewer Service&Bedding(24
24 950.4950 Inline,9 Exist Taps) 33 Each $125.00 $4,125.00
25 950.5100 Connection Into Existing Manhole 2 Each $400.00 $800.00
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City of Brookings
Tax Increment Distinct Number Four
26 950.5300 Manhole Frame and Cover 2 Each $425.00 $850.00
27 950.5600 Manhole ExfiltrationlVacuum Test 1 Each $350.00 $350.00
28 950.5610 Sanitary Sewer Exfiltration Testing 622 LF $1.20 $746.40
29 950.5620 PVC Sewer Pipe Deflection Test 622 LF $1.00 $622.00
WATER MAIN IMPROVEMENTS
30 SPECIAL Remove&Salvage Fire Hydrant to BMU 2 Each $500.00 $1,000.00
31 260.7010 Trench Stabilization 20 Ton $10.00 $200.00
32 900.0201 6"C900 DR 18 PVC Watermain 58 LF $22.00 $1,276.00
33 900.0202 8"C900 DR 18 PVC Watermain 1208 LF 27.00$ $32,616.00
INSTALL CITY FURNISHED 6"MJ Gate
34 SPECIAL Valve with Box 4 Each 350.00$ $1,400.00
INSTALL CITY FURNISHED 8"MJ Gate
35 SPECIAL Valve with Box 4 Each 350.00$ $1,400.00
INSTALL CITY FURNISHED Fire Hydrant
36 SPECIAL 3 Each 550.00$ $1,650.00
37 900.0402 8"MJ Elbow 11.25/22.5/45 Degree 2 Each $300.00 $600.00
38 900.0501 6"MJ Elbow 11.25/22.5/45 Degree 2 Each $280.00 $560.00
39 900.0450 8"x 8"MJ Tee 2 Each $400.00 $800.00
40 900.0502 8"x 6"MJ Tee 1 Each $325.00 $325.00
41 900.0600 Water Service Excavating&Backfilling 1208 LF $11.00 $13,288.00
City Water Tapping Fees and
42 SPECIAL Corporations for Services 58 Each $145.00 $8,410.00
Water Services&Bedding(1"Copper
43 SPECIAL Tubing,Curb Stop,&Barrel) 33 Each $300.00 $9,900.00
44 900.0708 Connect To Existing Watermain 2 Each $500.00 $1,000.00
45 900.0802 8"x 6"MJ Reducer 4 Each $250.00 $1,000.00
46 950.5410 Manhole Construction Plate Marker 2 Each $125.00 $250.00
47 900.8001 6"Watermain Bedding Material 58 LF $3.00 $174.00
48 900.8002 8"Watermain Bedding Material 1208 LF $3.00 $3,624.00
TOTAL GROSS BASE BID $325,745.40
Plus$51,254.60 Contingency $377,000.00
32 $160,312.50 Residential Housing Units 5,130,000.00
-14-
City of Brookings
Tax Increment Distinct Number Four
Sources and Uses
Sources of Funds
First Bank and Trust $475,000
Total Sources $475,000
Uses of Funds
Public Improvements
Grading/Street Improvements $218,500
Sanitary Improvements $58,500
Water Main Improvements $100,000
Financing Costs
Capitalized Interest $77,000
Bank Origination Fee 2% $9,500
Legal Estimated $5,000
Advisor $6,500
Total Uses $475,000
-15-
a,
City of Brookings
Tax Increment Distinct Number Four
SCHEDULE 2
-16-
r i r
I 4)f
'-' 0 .....,
m KINGS ,s()titii Dcitz()to
Tax Increment District #4
Base Value TBD
Owner Occupied Payable in 2008
Construction Valuation Revenue City Mill School Mill County Total Mill Total Total
Year Year Year Valuation Increment Increment for
Rate Rate Mill Rate Rate Increment
Debt Service
2009 2010 2011 $ 2,250,000.00 2.61 10.77 4.86 18.24 $ 41,040.00 $ 41,040.00
2010 2011 2012 $ 2,880,000.00 2.61 10.77 4.86 18.24 $ 52,531.20 $ 93,571.20
2011 2012 2013 $ - 2.61 10.77 4.86 18.24 $ - $ 93,571.20
2012 2013 2014 $ - 2.61 10.77 4.86 18.24 $ - $ 93,571.20
2013 2014 2015 $ - 2.61 10.77 4.86 18.24 $ - $ 93,571.20
2014 2015 2016 $ • 2.61 10.77 4.86 18.24 $ - $ 93,571.20
2015 2016 2017 $ - 2.61 10.77 4.86 18.24 $ - $ 93,571.20
2016 2017 2018 $ - 2.61 10.77 4.86 18.24 $ - $ 93,571.20
2017 2018 2019 $ - 2.61 10.77 4.86 18.24 $ - $ 93,571.20
2018 2019 2020 $ 93,571.20
2019 2020 2021 $ 93,571.20
2020 2021 2022 $ 93,571.20
2021 2022 2023 $ 93,571.20
2022 2023 2024 $ 93,571.20
2023 2024 2025 $ 93,571.20
2024 2025 2026 $ 93,571.20
2025 2026 2027 $ 93,571.20
2026 2027 2028 $ 93,571.20
2027 2028 2029 $ 93,571.20
2028 2029 2030 $ 93,571.20
$ 5,130,000.00
$1,818,892.80
Present Value of Revenue Stream 6.00% $ 942,586.61
Note: These numbers are for projection purposes only and do not reflect what the actual
number(s)may be. The projection numbers are based on assumptions provided by the developer.
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BRE) KINGS - i )
Tax Increment District#4 - Impact on Local Jurisdictions
!Estimated Base Value TBD
Yearly .
County Yearly 4;
,
Construction Valuation Revenue Valuation School Cumulative .. iseet ' County Cumulative !,-;.,..preserifi„,
School
Year Year Year Increment Mill Rate* Impact ,Value at t*i Mill Rate .m Impact Vattaia01044:.
Impact _-_,_, 1 pact
2009 2010 2011 $ 2,250,000,00 3,30 $ 7,425.00 $ 7,425.00 ,$ 8,449,72 4.86 $10,935.00 $ 10,935.00 j *498.6,7,,,
2010 2011 2012 $ 2,880,000.00 3.30 $ 9,504.00 $ 16,929.00 3 13,872,97 4.86 $13,996.80 $ 24,931.80 $ 24t1
2011 2012 2013 $ - 3.30 $ - $ 16,929.00 $13,0871'0 4.86 $ - $ 24,931.80 .8$ 1927463'
2012 2013 2014 $ - 3.30 $ - $ 16,929.00 $ 12346.90.; 4.86 $ - $ 24,931.80 '‘$41,818,Utl,,
2013 2014 2015 $ - 3.30 $ - $ 16,929.00 ,$, 11,848,02 4.86 $ - $ 24,931.80 / A7„154,36,
2014 2015 2016 $ - 3.30 $ - $ 16,929.00 :$,,10,881E70 4.86 $ - $ 24,931.80'h$:%,..to,tpuw,
2015 2016 2017 $ - 3.30 $ - $ 16,929.00 ...$ 10,388,69; 4.86 $ - $ 24,931.80 -S;i15,257,31,1
2016 2017 2018 $ - 3.30 $ - $ 16,929.00 !8 '4,779.90:' 4.86 $ - $ 24,931.80 441,14,40313.7
-
2017 2018 2019 $ - 3.30 $ - $ 16,929.00 4,,:.'9,228,32 4.86 $ - $ 24,931.80 4., 1q*,-,
2018 2019 2020 $ - ::.4'‘j...; „..,-.? ;,,. $ 4
v. V:•''''
2019 2020 2021 $ - -V.,, „. ,..„ $ - .3
-..,;',..
2020 2021 2022 $ - $: -' , $ - .1",:.5,...;%•'.,..T.,',,
. .
2021 2022 2023 $ - ,$, pe`, , $ ,.„,,,ti,...;
2022 2023 2024 $ $ - 11"'i '''',--4,'"
2023 2024 2025 $ - ::$ ,. ": .-- ,- $ - 4:
- 4::::41::::::,
2024 2025 2026 $ $
'''' —
2025 2026 2027 $ $ - 4 ''..'..':"-,:'N,'",
2026 2027 2028 $ - '.'$ ...:', ''' - , $
$ 5,130,000.00 $142,857.00 $ 97,766.93 $ 210,389.40 $143,984.02
*Note the full school levy is 10.77,but will only realize an
impact of 3.30 per$1,000 of valuation. The difference is
made up by levying the amount on the districts tax payers
**The school impact is calculated by the following:
$3.00 for Capital Outlay
$.30 for Pension
***Inflation is not taken into account in the projections
Note: These numbers are for projection purposes oly and do not reflect what the actual tax impact
may be. The projection numbers are based on assumptions provided by the developer.
, • ,
NORTHLAND SECURITIES
Brookings School Valuation
Calculation of TIF Increment/Impact
State of South Dakota-Payable 2008
Valuation Multiplier Value for General Levy Calc
Ag Value $91,755,877 1.00000 $91,755,877
NA-Z Value $2,739,032 1.36900 $3,749,735
This amount is set by
00 Value $541,990,215 1.57200 $852,008,618
the Legislature every
Other Value $344,962,755 3.36160 year $1,159,626,797
Utility Value $9,776,365 3.36160 $32,864,229
Total $991,224,244 $2,140,005,256
TIF Increment Multiplier Calculation
Amount of Valuation
Increase $2,250,000 - 'Max amt set by State of SD is
Owner Occupied Levy $4.26 4.26 on 00
Base Impact $9,585
Tax impact Per$1,000 $0.0045
Property Tax Impact
Type of Value Taxable Value Multiplier Tax Impact
Taxable Value/1000 x Multiplier
Ag Value $150,000 1.00000 $0.67
NA-Z Value $150,000 1.36900 $0.92
00 Value $150,000 1.57200 $1.06
Other Value $150,000 3.36160 $2.26
Utility Value $150,000 3.36160 $2.26
Special Education Levy
Amount of Valuation
Increase $1,050,000
Spec.Ed Levy $1.40
Base Impact $3,150
Tax Impact per$1,000 $0.00318
Property Tax Impact for Special ED
Type of Value Taxable Value Multiplier Tax Impact
Taxable Value/1000 x Multiplier
Ag Value $150,000 1.00000 $0.48
NA-Z Value $150,000 1.36900 $0.65
00 Value $150,000 1.57200 $0.75
Other Value $150,000 3.36160 $1.60
Utility Value $150,000 3.36160 $1.60
Total Property Tax Impact for Seiler Addition TIF
Type of Value Taxable Value Tax Impact
Ag Value $150,000 $1.15
NA-Z Value $150,000 $1.57
00 Value $150,000 $1.81
Other Value $150,000 $3.86
Utility Value $150,000 $3.86
Note: These numbers are for projection purposes only and do not reflect what the actual tax impact may be. The
projection numbers are based on assumptions provided by the developer.
+r t
City of Brookings
Tax Increment Distinct Number Four
SCHEDULE 3-FISCAL IMPACT STATEMENT
Fiscal Impact Statements
Tax Increment District Number Four
Introduction
The fiscal impact statement is intended to provide a succinct analysis of the estimated impact of the
Tax Increment District to the public pursuant to SDCL§ 11-9-13(4). It is not intended to rival the level of
detail required by a detailed financial analysis.
Fiscal Impact Statement
A fiscal impact statement shows the impact of the tax increment district, both until and after the
bonds or obligations are repaid, upon all entities levying taxes upon property in the district.
Definitions
"Fiscal Impact" means the increase or decrease in revenues and generally refers to an impact to
revenues caused by the district.
"Revenue"means ad valorem taxes.
"Assumptions" means factors or definitions used in the fiscal analysis. Assumptions may include
facts and figures identified by the District and educated guesses that are sometimes necessary when not
all of the information is available. Assumptions are often used to extrapolate an estimate. Assumptions
may include an estimate of tax levies of each taxing entity,the school aid formula contribution,the value
of the real property,etc.
Assumptions:
1.The property will have improvements which at completion will be valued for taxable purposes
estimated to be$5,130,000.
2. The maximum tax levy of all taxing districts will be $25.00 per thousand dollars of taxable
valuation.
3.Tax increment will start to be collected in 2011 for a maximum of 18 years.
-20-
w
City of Brookings
Tax Increment Distinct Number Four
4. This is the amount of tax increment that could be derived from the district. A estimated
maximum dollars per thousand was used for each taxing district.
Estimate
Dollars
Taxing Entity Per thousand Yearly
City of Brookings $ 5.13 $26,317 136,190
Brookings County $ 2.74 $14,056 72,741
Brookings School District $ 17.13 $87,879 454,765
TOTAL $ 25.00 $128,250 663,696
After the termination of the District,the taxing entities will receive all tax increment as part of their
general levy tax collections.
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y W 1
City of Brookings
Tax Increment Distinct Number Four
SCHEDULE 4
ECONOMIC FEASIBILITY STUDY
TAX INCREMENT FINANCING
FEASIBILITY STUDY
AND
BLIGHT STUDY
City of Brookings, South Dakota
-22-
Feasibility Study
INTRODUCTION
A Housing District is proposed in Tax Increment District Number Four (the "TID FOUR") at a
site located in the south west portion of the City of Brookings described in the tax increment financing
proposal submitted by Developer to the Brookings City Council.
The development of the TID FOUR is development of affordable housing units, and without
the City's financial participation and support, the TID FOUR could not be constructed. An essential
component of the City's participation is City funding for the construction of public sewer,water, road
and other infrastructure improvements ("Project Costs") needed to support the Project (or any other
comprehensive development of the site), total project costs to complete the entire project is
estimated to exceed $5,130,000. The project will not exceed $475,000 to construct the public works.
No portion of the tax increment district revenues shall be used to construct housing units as described
in SDCL 11-9.
The City has made it clear that City funding for these public improvements must be supported
by the tax revenues generated by the Project,and not by the general revenues of the City.The vehicle
through which this can be accomplished is "tax increment financing" under the South Dakota Tax
Incremental District Law (South Dakota Codified Laws Chapter 11-9). Tax increment financing is an
indispensable self-financing tool used throughout the United States to help local governments
successfully develop and redevelop areas and encourage economic development.
In tax increment financing, the current real property tax assessed value of all properties in a
designated project area ("tax increment financing district") is established as the "base value." As
development in the tax increment financing district increases the assessed values of the redeveloped
properties, a portion of the additional tax revenue generated by the increase in assessed value over
the base value is set aside and committed by the City for debt service on tax increment bonds, the
proceeds of which would be used for the acquisition or construction of the Project Costs.
Tax increment financing is permitted only in connection with a "project plan"duly adopted by
the City.The process is set forth in the Tax Increment District Law,and is generally as follows:
Any person may request the City Council to designate a tax increment financing
district.The request may be through a formal application process,or a presentation to
the City Council. Upon receiving any request, the City Council determines preliminary
feasibility of the project. This preliminary feasibility determination includes fiscal,
legal and political considerations.
If it is determined feasible,the City Council directs staff or the planning commission to
initiate the process. The planning commission then sets a proposed hearing date and
starts the notice procedure.
, $
City of Brookings
Tax Increment Distinct Number Four
Notice of the intent to create a tax increment district is published and sent to all
taxing districts not less than 10 days prior to the hearing.
The planning commission holds a hearing and allows members of the general public to
comment upon the proposed creation of a tax increment district. At the end of the
hearing, the planning commission may recommend the creation of the tax increment
district to the City Council.
The City Council places the recommendation on the agenda and at the public meeting
may pass a resolution to create the tax increment district in accordance with the Tax
Increment District Law. The resolution is published and becomes effective on the 215t
day after publication, unless it is referred to a vote of the electors.
After the resolution becomes effective, the Department of Revenue of the State of
South Dakota is sent a letter requesting to determine the base.
Once the base is determined, a tax increment project plan is prepared by or at the
direction of the planning commission, approved and forwarded to the City Council for
their determination.
Once the project plan is approved by the City Council, the City has five years to spend
tax increment revenues or bond proceeds on or for project costs.
After the project plan is approved,the City Council is authorized to issue by resolution
tax increment bonds "for the purpose of carrying out or administering a project plan".
The resolution would irrevocably pledge its tax increment revenues to the debt service
on the City's tax increment bonds. (See Tax Increment District Law Section 11-9-37).
The Developer has requested that the City issue tax increment bonds in the amount necessary to
cover the costs of construction of the public improvements, infrastructure and road and bond
issuance and related financing costs (including capitalized interest and a reserve fund), currently
estimated to total approximately$475,000.
24
` I
City of Brookings
Tax Increment Distinct Number Four
Feasibility Study
The following study indicates the project is feasible.
Assumption:
1. Housing construction Projections attached.
Z. Dollars per thousand levy= $18.24 per$1O0Oof assessed valuation.
3. Duration = not to exceed 20 years from creation of the district
4. Interest rate = 7.50%.
S. Capitalized interest period < 36 months.
6. Tax increment collection beginning in year 2011.
25
ter, t W
,ti4:111 3\1,0,"t 1., 11.5
Tax Increment Revenue Note
City of Brookings
Tax increment Financing District
Seiler Addition
1st Note LMI House Lots TIF Note is assumed to be gross funded Current Valuation SO TIF Revenue $ 84,214
Note Date: 10/01/08 Total Developed Valuation $ 5,130,000 Semi Annual Revenue $ 42,107
Note Rate: 7 50% Increment Value $5,130,000
Par Amount $475,000 For Projection Purposes Only Percent of Value 90.00%
Net Proceeds $397,813 Based on assumptions provided by Developer Adjusted Valuation $4,617,000
Mill Levy 0.01824
NOTE AMORTIZATION REVENUE BREAKDOWN WORK C 2224N8
Loan I 9emi•Aota, .,"1„ • PVTO, :
Semi-Annual Capitalized Balance Cap Coverage @ Excess .241#T t; •,..,',,Work' , l8f1083:', ,
Date Principle interest P&I Net Revenue Interest Outstanding Interest 1.00x Coverage ' Totem, 1.319& ` 'Pagoda ,
475,00000 ,''. 'q, a :'':`':' ^r. ...•;_"''3';'4.. >
12/01/08 0.00 000 000 0.00 5.937.50 475,00000 5,937.50 0.W 0.00 t,.$= •. %-:2,,9$2 ' 0,.ws;'o1'
06/01/09 0 00 0.00 0.00 0.00 17,812.50 475,000 00 17,812.50 0.00 0.00 ,:°. _,, i '.*'0'P$SB ••$ •r8 7 a,' F,S,S
12/01/09 000 000 0.00 0.00 17,812.50 475,00000 17,81250 000 000 ':;':;;No 0,60 J" t,8i1 , 22
06/01/10 000 0.00 0,00 0.00 17,812.50 475,00000 17512.50 000 0.00 i,„1:1,,',:.;-,. :."y..: 2242 .d..:.::
S
City of Brookings
Tax Increment Distinct Number Four
BLIGHT STUDY
This section presents an analysis of existing buildings, or lack thereof, and lot conditions within the
proposed development project area (the "Study Area"). The Study Area is depicted in Attachment 1
"Proposed Tax Increment District Project Area Boundary". The development project proposed for the
Study Area is the TID FOUR, which consists of approximately 16.1 acres or 701,500 square feet of
potential residential development. In order to provide economic development by providing affordable
residential lots, tax increment bonds are proposed to issued by the City to fund the certain public
project costs and cause construction of the land preparation, infrastructure, sewer, water and other
improvements required to sustain the TID FOUR. No portion of the proceeds of the tax increment bonds
will be used to construct or rehabilitate residential housing units.
The proposed development project is being considered in accordance with the provisions of the Tax
Increment District Law, which grants municipalities the power to redevelop blighted areas or cause
them to be redeveloped by private parties, and fund the costs of public improvements through the
issuance of tax increment bonds and/or notes.
Blight is a legally defined term and is found in the Tax Increment District Law Sections 11-9-9 through
11-9-11.
Any area, including slum area, in which the structures, buildings, or improvements, by reason of:
(1) Dilapidation,age, or obsolescence;
(2) Inadequate provisions for ventilation, light, air,sanitation,or open spaces.
(3) High density of population and overcrowding;
(4) The existence of conditions which endanger life or property by fire and other
causes;or
(5) Any combination of such factors;
are conducive to ill health,transmission of disease, infant mortality,juvenile delinquency,or crime,
and which is detrimental to the public health, safety, morals,or welfare, is a blighted area.
Any area which by reason of:
(1) The presence of a substantial number of substandard, slum,deteriorated,or deteriorating
structures;
(2) Predominance of defective or inadequate street layouts;
(3) Faulty lot layout in relation to size, adequacy, accessibility,or usefulness;
(4) Insanitary or unsafe conditions;
(5) Deterioration of site or other improvements;
(6) Diversity of ownership,tax, or special assessment delinquency exceeding the fair value of the
land;
(7) Defective or unusual conditions of title;
(8) The existence of conditions which endanger life or property by fire and other causes; or
(9) Any combination of such factors;
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City of Brookings
Tax Increment Distinct Number Four
substantially impairs or arrests the sound growth of a municipality, retards the provision of housing
accommodations, or constitutes an economic or social liability and is a menace to the public health,
safety, morals,or welfare in its present condition and use, is a blighted area.
The site has no street layout, lack of sewer, lack of storm sewer, impairs sound growth and retards
housing accommodation.
Any area which is predominantly open and which because of obsolete platting, diversity of
ownership, deterioration of structures or of site improvements, or otherwise, substantially
impairs or arrests the sound growth of a municipality, is a blighted area.
This study: (1) surveys and analyzes the Study Area to determine if it is blighted within the meaning of
the Tax Increment District Law; and (2) assesses the feasibility of conducting a development project
(which is proposed to be the TID FOUR) in the Study Area in accordance with Tax Increment District Law.
Field inspections of the Study Area were conducted in 2008. In addition, aerial photographs and City
land use and property data were reviewed,and building and site conditions,existing land uses, including
under-utilization of land, parcel sizes and configurations, and other factors which may contribute to
blighting were analyzed.
The following conditions were observed in the Study Area:
1) lack of water mains and fire protection;
2)faulty lot layout in relation to its size, adequacy,accessibility and usefulness;
3) inadequate streets and street access;
4) underutilized parcel; and,
5) incidence of significant deterioration or entire lack of public infrastructure including
roads, sidewalks, curbs and storm drainage. The detailed results of the survey are presented
below.
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City of Brookings
Tax Increment Distinct Number Four
Existing Conditions
Background and Definition of the Study Area
The Study Area boundary, as shown in Exhibit 1, "Proposed Tax Increment District Project Area
Boundary," was drawn to include the TID FOUR sites, and other properties likely to benefit directly and
indirectly, from the public improvements proposed to be made in the Study Area. It was observed that
other surrounding areas were not served by public services which due to the density, there exists risk to
life and property by fire.
The boundary of the Study Area encompasses all tax parcels within the boundary described
generally as follows:
The boundary starts at a point which is formed by the northern,western, southern, and eastern
boundaries as shown hereafter.
Existing Land Use
The Study Area comprises a total of approximately 20 acres,and contains bare ground. Even though
the area is in the City limits,there are no city services. In addition,the area abuts another development
which was developed without adequate city services. There exists lack of sanitation which is conducive
to ill health,transmission of disease, infant mortality, and which is detrimental to the public health,
safety.
Vacant and Underutilized Properties
The entire district is vacant and underutilized.
Public Improvements
The existing infrastructure systems in the Study Area, including the water mains and combined
storm and sanitary sewer lines are obsolete and inadequate for any comprehensive development
program. The area suffers from lack of all services.
CONCLUSIONS
The Study Area is a blighted area under the criteria set forth in the Tax Increment District Law,
and the existing conditions warrant the preparation by the City of a plan for a development project in
the Study Area.
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