[Ord. No. 2009-19 §1, 8-10-2009]
The Tax Increment Financing Commission of the City of Laurie, Missouri (the "TIF Commission") is hereby established in accordance with the Real Property Tax Increment Allocation Redevelopment Act, Sections 99.800 — 99.865, RSMo. (the "Act").
The TIF Commission shall be comprised of eleven (11) members and the composition and organization of the TIF Commission shall be in accordance with Section 99.820, RSMo., of the Act.
A Chairperson shall be elected by a majority vote of the TIF Commission and shall serve for a twelve (12) month period.
The TIF Commission is authorized to adopt such bylaws as are deemed reasonably necessary for its efficient organization, operation and responsibilities.
Duties and purpose.
The purpose of the TIF Commission is to assist in evaluation and promotion of economic development projects and plans submitted by interested parties or initiated by any public agency and to make recommendations to the Board of Aldermen.
The TIF Commission shall vote on all proposed redevelopment plans, redevelopment projects, and designations of redevelopment areas, and amendments thereto, within thirty (30) days following completion of the public hearing required by Statute. The TIF Commission shall make its recommendations regarding the project to the Board of Aldermen within ninety (90) days following completion of said hearing. All public hearings and public notices shall be provided for in accordance with the Act.
[Ord. No. 2009-19 §2, 8-10-2009]
The Tax Increment Financing (TIF) Policies and Guidelines for Application and Application Procedures are hereby adopted as fully set out herein and the Mayor is hereby authorized to implement the following procedures and to make such additional changes and clarifications that shall be deemed advisable and in the best interest of the City.
[Ord. No. 2009-19 §3, 8-10-2009]
It is the policy of the City to consider the judicious use of TIF for those projects which demonstrate a substantial and significant public benefit by constructing public improvements in support of developments that will, by creating new jobs and retaining existing employment, eliminate blight, strengthen the employment and economic base of the City, increase property values and tax revenues, reduce poverty, create economic stability, upgrade older areas, facilitate economic self sufficiency, and implement the economic development strategy of the City.
Care will be exercised in the use of TIF to evaluate completely each project to ensure that the benefits which will accrue from the approval of the agreement are appropriate for the costs which will result, and that they are equitable to the City as a whole.
The City intends to recover the costs associated with the consideration of TIFs. The developer shall agree to pay all staff, legal and consultant costs for the analysis, development and finalization of the redevelopment plan and for the costs of special TIF counsel. The developer shall deposit that amount with the City before the City convenes the TIF Commission. The developer shall pay all additional costs incurred during the project, including an administrative fee to offset the cost of record keeping, report preparation and accounting for each approved TIF project. The fee will be assessed on a monthly basis against the annual increment generated by the TIF project.
[Ord. No. 2009-19 §4, 8-10-2009]
Criteria. The following criteria are to be used to evaluate TIF applications:
TIF applications may be considered for removal of blight and promote revitalization and/or to provide for public improvements to benefit economic development and employment. The City prefers the use of TIF funds for public improvements that benefit not only the project but also the public at large.
Each TIF application must demonstrate that "but for" the use of TIF, the project is not feasible and would not be completed without the proposed TIF assistance.
All TIF applications requesting the issuance of bonds or notes will be required to demonstrate that the payments in lieu of taxes ("PILOTS") and/or the economic activity taxes ("EATS") expected to be generated will be sufficient to provide a debt coverage factor of at least one and one-fourth (1.25) times the projected debt service prior to the sale of any tax increment bonds or notes. This is a minimum requirement and developers should be aware that a superior coverage ratio will be looked on with increased favor in the consideration of the application.
The total amount of TIF assistance for project costs for industrial, manufacturing, office, retail and commercial TIF applications should not exceed fifteen percent (15%) of the total project costs including all hard and soft costs and developer fees estimated for the entire project. All other public assistance contemplated or requested for the project must be disclosed in the application (or added to the application as soon as they are known) and will be considered by the TIF Commission in evaluating the proposed TIF project and application as a whole.
TIF will generally be reserved for projects which do not qualify for alternative methods of financing or where TIF assistance is deemed by the City to be the preferred method of economic development incentive.
Each TIF application must include evidence that the applicant:
Has the financial ability to complete and operate the project. Developers will be evaluated on their prior record of development, amount of capital committed to the project and overall financial strength. Developers with partners are expected to identify the partners at the beginning of the process.
Will contribute equity of at least fifteen percent (15%) of the total cost of the project. Projects with equity contributions from the developer in excess of twenty-five percent (25%) will be viewed more favorably. Equity contributions in cash will be viewed more favorably than "in kind" contributions such as land. This requirement is exclusive of any performance bond required for the project.
Has thoroughly explored alternative financing methods.
The City will maintain a retainage account consisting of at least the final five percent (5%) of the financial assistance to the TIF project which funds will not be paid out until the project is completed or the developer satisfies other performance standards as established in the TIF agreement.
To encourage an inflow of customers from outside the City or provide services or fill retail markets that are currently unavailable or in short supply in the City, we encourage TIF applications for retail and service commercial projects. TIF projects which create jobs with wages that exceed the community average will be encouraged. Industrial, manufacturing and office developments may be given more favorable consideration than warehouse type uses based upon the projected employment per square foot. Additional consideration will be given to the development of areas where the project will be a catalyst for further high quality development.
TIF applications for the redevelopment of existing commercial and industrial areas will be viewed favorably. Projects to stabilize current commercial and industrial areas that have or will likely experience deterioration will be favored.
The projected term of the TIF will be a factor, with shorter terms being viewed more favorably than longer terms. TIF applications which provide for the use of not more than fifteen (15) years of tax increment financing generated by each redevelopment project will be preferred.
TIF projects which are constructed in phases are viewed with greater skepticism. TIF projects that propose a reasonable and certain end date for construction and occupancy and demonstrate clearly and convincingly how those goals will be achieved will be viewed positively.
All TIF applications must clearly comply with the requirements of the Act.
All approved projects must comply with prevailing wage and hour requirements for public works projects, as set forth in Sections 290.210, RSMo., et seq., for all portions of the project receiving TIF assistance. The developer will be required to indemnify the City for all prevailing wage claims brought against the City for all TIF funded public works projects that are constructed by or at the direction of the developer. Work to be covered by TIF funds will be identified in the application.
TIF applications which include the establishment of business areas, or the redevelopment of existing business areas, should include information as to the business type of the major tenants of the TIF area. In addition, a thorough market analysis should be completed which identifies:
Projects with commitments by tenants by lease or other legally binding contracts for a minimum of fifty percent (50%) of the retail commercial space will be viewed with greater favor by the TIF Commission and the City.
Notwithstanding the foregoing, TIF applications which do not meet any of the above referenced criteria will be viewed favorably by the City if the application clearly demonstrates that the project is of vital interest to the City and will significantly assist the City in the elimination of blight, financing desirable public improvements, strengthening the employment and economic base of the City, increasing property values, reducing poverty and creating economic stability.
Accountability. TIF applications are expected to include the following:
If the TIF application is being submitted based upon anticipated revenue criteria, the City may require that language shall be included in the redevelopment plan and contract which stipulates that the City's obligation to the developer may be reduced if satisfactory evidence is not shown that the indicated anticipated revenue has been generated.
If the TIF application is being submitted based upon job creation criteria, language may be included in the plan which stipulates that the City's obligation to the developer may be reduced if satisfactory evidence is not shown that the indicated number, and quality of jobs have been generated.
If businesses are to be relocated from other areas of the City, sufficient justification must be included to indicate why this relocation should be given favorable consideration. If existing businesses are to be relocated to the TIF area, the base year activity for purposes of determining the tax increment for both real property and EATS taxes will be the last twelve (12) month period at the businesses current location, immediately preceding the relocation.
Method Of Financing. TIF applications may request that TIF assistance be provided in one (1) of the following forms:
Tax increment revenue bonds or special obligation bond or note financing;
Direct reimbursement to the applicant for hard and soft design and construction costs;
Pledge of tax increment financing revenues to pay a portion of private financing in addition to other eligible costs; or
Any combination of the foregoing methods.
In deciding which method of financing to use, the prevailing factor in making the determination will be total costs, the security for the bonds and the duration of the redevelopment plan. The City will not provide credit enhancements for the special obligation bonds or notes; however, credit enhancement provided by the developer on any bonds or notes will be viewed favorably. The decision as to what method of financing is selected will be made by the City. The underwriter or purchaser of any publicly sold bonds will be selected by the City.
Term. The maximum period for which a TIF can be used is established by the TIF Statute at twenty-three (23) years. The most favorable consideration will be provided for redevelopment plans that last no longer than fifteen (15) years.
Impact On School Districts And Other Public Entities. Before submitting a TIF application package to the City, applicants should evaluate and consider any TIF policies adopted by local public school or other taxing districts within the boundaries of the redevelopment area and directly address those policies in the application. For developments that add students to the school population, the City strongly encourages the incorporation of a distribution of PILOTS as surplus to taxing districts including public schools in accordance with the applicable school district TIF policy. In addition to such surplus declaration, a capital contribution may be made to a public school or taxing district that incurs additional capital costs that are the result of the redevelopment that occurs pursuant to a redevelopment plan.
Other Conditions. The City reserves the right to modify or waive any or all of these policies and procedures.