HomeMy WebLinkAboutResolutions - 2015.05.06 - 21817MISCELLANEOUS RESOLUTION #1511.6 May 6,2015
BY: Finance Committee, Tom Middleton Chairperson
IN RE: BOARD OF COMMISSIONERS — PARTICIPATION IN THE CITY AUBURN HILLS DOWNTOWN
DEVELOPMENT AUTHORITY
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS the Oakland County Board of Commissioners supports the economic growth of Oakland
County; and
WHEREAS the Downtown Development Authority ("DDA") Act, Public Act 197 of 1975, as amended, MCL
125.1651 et. seq., ("DDA Act") enables DDA's to utilize Tax increment Financing ("TIF") to prevent
deterioration, encourage historic preservation and promote economic growth in a business district; and
WHEREAS the Board of Commissioners Tax Increment Financing District Review Policy Ad Hoc
Committee ("TIF Review Committee") reviews requests from municipalities to utilize TIF as provided in
Miscellaneous Resolution # 15056, which contains the recently updated performance standards to
consider ("TIF Policy") when making its recommendation to the Finance Committee on possible County
participation in TIF plans; and
WHEREAS on February 24, 1983, City of Auburn Hills ("Auburn Hills") adopted Ordinance Number 325
establishing a DDA for Auburn Hills and on July 14, 2014, Auburn Hills adopted a Resolution of Intent and
on August 11,2014 held a public hearing regarding its intent to amend the boundaries of the Auburn Hills
DDA; and
WHEREAS on September 4, 2014 representatives of Auburn Hills and the DDA presented their TIF plan
to the TIF Review Committee; and
WHEREAS by Miscellaneous Resolution #14214, this Board of Commissioners exempted the County ad
valorem property taxes from capture by the DDA and requested Corporation Counsel to attempt to
negotiate an agreement with Auburn Hills and the DDA; and
WHEREAS representatives from Auburn Hills and the DDA have spent considerable time and effort
working with the County to structure a mutually acceptable development and TIF plan; and
WHEREAS representatives from Auburn Hills and the DDA appeared again before the TIF Review
Committee on April 23, 2015 and presented a TIF plan for the DDA and a proposed contract, both of
which meet the standards of the TIE Policy; and
WHEREAS the TIF plan provides for the capture of County property taxes beginning with the tax capture
for 2015 for up to a total of $1,613,705.16 or fifteen years (through 2029), whichever occurs first; and
WHEREAS although the County originally decided to opt-out of the Auburn Hills TIE plan, upon further
review and successful negotiations with Auburn Hills and the DDA, the TIF Review Committee now
recommends participation in the DDA plan presented on April 23, 2015 and set forth in the attached
contract; and
WHEREAS the contract requires the DDA to provide detailed annual financial reports to the County and
to appear before the TIE Review Committee every 5 years during the term of the contract.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners hereby
rescinds Miscellaneous Resolution #14214.
BE IT FURTHER RESOLVED that the Finance Committee recommends County participation in the TIF
plan in an amount not to exceed $1,613,705.16 or for a period of fifteen years, whichever comes first,
beginning with the tax year of 2015.
BE IT FURTHER RESOLVED that the Board of Commissioners authorizes the County's participation in
the DDA as specified in the attached contract.
Chairperson, on behalf of the Finance Committee I move adoption of the foregoing resolution.
FINANCE COMMITTEE VOTE:
Motion carried unanimously on a roll call vote.
TAX INCREMENT FINANCING AGREEMENT
BETWEEN THE
COUNTY OF OAKLAND, CITY OF AUBURN HILLS. AND THE
AUBURN HILLS DOWNTOWN DEVELOPMENT AUTHORITY
THIS TAX INCREMENT FINANCING AGREEMENT ("Agreement") is entered into
this day of , 2015 between the COUNTY OF OAKLAND ("County"), 1200 North
Telegraph Road, Pontiac, Michigan 48341, the CITY OF AUBURN HILLS ("Auburn Hills"),
1827 N. Squirrel Road, Auburn Hills, Michigan 48326-2753 and the AUBURN HILLS
DOWNTOWN DEVELOPMENT AUTHORITY ("Auburn Hills DDA") 1827 N. Squirrel Road,
Auburn Hills, Michigan 48326-2753. In this Agreement, the County, Auburn Hills, and
the Auburn Hills DDA may also be referred to as "Parties."
The Downtown Development Authority Act ("DDA"), Public Act 197 of 1975, as
amended, MCL 125.1651 et. seq., ("DDA Act"), authorizes a municipality to establish a
DDA when the municipality determines that it is necessary for the best interests of the
public to correct and prevent deterioration in a business district and to promote
economic growth. One of the purposes for creating a DDA is to permit a municipality to
finance improvements in a designated area by capturing the property taxes levied on
any incremental increase in property values within the development area; this is
commonly referred to as tax increment financing.
Section 3(3) of the DDA Act provides that a governing body of a taxing
jurisdiction whose ad valorem taxes would otherwise be subject to capture may
exempt its taxes from capture by adopting a resolution to that effect. Section 14(4)
of the DDA Act also provides that a DDA may enter into agreements with taxing
Auburn Hills DDA Page 1 of 9
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jurisdictions and the municipality establishing the DDA to share a portion of the
captured assessed taxable value of the development area.
On February 24, 1983, Auburn Hills adopted Ordinance Number 325 establishing
a DDA for Auburn Hills. Prior to 1994, the County did not have the legal right to opt out
of the capture of its taxes by a DDA. On July 14, 2014, Auburn Hills adopted a
Resolution of Intent and on August 11, 2014 held a public hearing regarding its intent to
amend the boundaries of the Auburn Hills DDA. On September 18, 2014, the Oakland
County Board of Commissioners passed MR #14214 opting out of the Auburn Hills tax
capture and directed Corporation Counsel to attempt to negotiate a contract. On
October 20, 2014, Auburn Hills adopted an ordinance to amend the boundaries of the
Auburn Hills DDA. Auburn Hills has scheduled a public hearing for April 27, 2015 for
purposes of adopting an ordinance approving a Development and Tax Increment
Financing ("TIP') Plan for the Auburn Hills DDA which Development and Tax Increment
Financing Plan provides that the Auburn Hills DDA will capture fifty percent (50%) of the
tax levy of all taxing jurisdictions levying taxes that would be subject to capture.
Shortly before Auburn Hills passed the 2014 resolution of intent,
representatives of Auburn Hills and the County conducted a series of meetings and
discussions concerning the County's potential participation in the Auburn Hills DDA
TIF Plan. The County has determined that in order to help promote economic
development throughout its borders, it is in its best interest to participate in the
Auburn Hills DDA as further defined in this Agreement.
Auburn Hills DDA Page 2 of 9
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In consideration of the mutual promises, representations, and agreements set
forth in this Agreement, and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the Parties agree as follows:
1. In accordance with the following conditions, the County agrees to allow
the tax increment revenue generated by its millage rate to be captured by the Auburn
Hills DDA from the area defined in the Development Plan for the limited purpose of
contributing the County's Pro-rata Share of the funding required for the Auburn Hills
DDA Development Plan and Tax Increment Financing Plan ("Plan") dated May 18,
2015, attached and incorporated as Exhibit A.
(a)
"County's Pro-rata Share" is defined as the County's proportionate share
of the combined millage funds captured by the Auburn Hills DDA from all
participating taxing jurisdictions, which include: County of Oakland (for
general operating and Parks & Recreation), City of Auburn Hills, Oakland
Community College, Oakland County Public Transit Authority and any
future taxing jurisdictions that opt in after the date of this Agreement.
With respect to the levy of any new additional millage by the County,
either to restore amounts reduced by the Headlee Amendment, or new
additional millage approved by County electors after the date of this
Agreement, such millages shall be exempt from this Agreement unless
the County Board of Commissioners, in its sole discretion, adopts a
resolution submitting such additional millages to this Agreement and
capture by the Authority.
Auburn Hills DDA Page 3 019
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(b) The improvements described in the development plan are projected to
cost $5,775,000. Auburn Hills, the County, and the Auburn Hills DDA
acknowledge that the total anticipated expenditure is an approximation
only. The Project shall be subject to applicable Auburn Hills public bid
procedures and the final cost will be adjusted accordingly. However,
notwithstanding the above acknowledgments, Auburn Hills and the
Auburn Hills DDA agree that the County's participation from the Oakland
County General Operating Millage and the Oakland County Parks and
Recreation Millage shall not exceed a total of $1,613,705.16 or a period
of 15 years (through 2029), whichever occurs first, subject to the
requirements below.
(c) The capture and retainage of the County's millage will be based upon a
base year utilizing the 2014 taxable value of the properties as set forth in
Exhibit A beginning with the 2015 tax collection and capture and
retainage will be based on increases in taxable values thereafter in
accordance with the terms and provisions of this Agreement.
(d) In no event shall capture from the County's millage be used to bury utility
lines, for land acquisition, for the construction of municipal facilities used
to house Auburn Hills' departments or operations, or for event and
marketing materials not directly related to the implementation of projects
approved within the TIF plan.
2. The Parties agree that although the DDA District/Development Area and
Development Plan covers a larger area from which the Auburn Hills DDA can and will
Auburn Hills DDA Page 4 of 9
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capture the County ad valorem property taxes, the captured County ad valorem property
taxes ("tax increment revenue") shall only be utilized and spent by the Auburn Hills DDA
for projects and other legally authorized items in the area listed in Exhibit B and used for
the projects listed in Exhibit C.
3. Unless otherwise agreed to by all of the Parties, once the County's total
share of the tax increment revenue captured reaches $1,613,705.50 or 15 years have
passed, (through 2029), whichever occurs first, the County's participation in the Auburn
Hills DDA will terminate and its portion of ad valorem property taxes that would
otherwise be subject to capture will be exempt from further capture by the Auburn Hills
DDA. Auburn Hills and the Auburn Hills DDA understand and agree that under no
circumstances shall the tax increment revenue generated by the County's millage rate
and retained by the Auburn Hills DDA be used to pay the full amount of the Project
costs.
4. The Auburn Hills DDA and Auburn Hills agree to the following:
(a) The Auburn Hills DDA shall within three (3) months after the end of the
Authority's fiscal year, send copies of the annual financial report to the
Oakland County Treasurer, the Economic Development and Community
Affairs Department and the Board of Commissioners. The report shall
include:
I. The amount of taxes captured by the Authority.
The amount spent on each project in the TIF Plan.
iii. The amount of private sector investment received.
Auburn Hills DDA Page 5 of 9
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iv. The number of buildings rehabilitated and the square footage per
building rehabilitated and the amount spent per building.
v. The amount of new construction including the dollar amount spent
and the square footage added.
vi. The number of new businesses locating in the District.
vii. The amount of new jobs created, and
viii. The increase/decrease in the taxable value.
ix. Any financial information that the County is required to report in its
financial statements or to the Michigan Department of Treasury.
(b) The Auburn Hills DDA representatives shall appear before the County TIF
Review Committee, at the Committee's request, within the first five (5)
years of the Agreement execution date, and each five (5) years
thereafter, to present the District's current return on investment and
discuss the financial information required in 4a and 4b above.
(c) The Auburn Hills DDA will promote the services available from the
Oakland County Economic Development Community Affairs Department
including the One Stop Shop Business Center and the Oakland County
Economic Development Corporation and the Oakland County Business
Finance Corporation.
(d) Auburn Hills will adopt/amend its community master plan to accurately
incorporate the TIF Plan with its next scheduled community master plan
review.
Auburn Hills DDA Page 6 of 9
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5. Any other Auburn Hills DDA project other than those specifically listed in
Exhibit C, for the Area in Exhibit B, may be considered by the County upon proper
application by the Auburn Hills DDA at the appropriate time in the future. Any proposed
modification or amendments to the Auburn Hills DDA Development Plan and Tax
Increment Financing Plan that are required under The DDA Act to be submitted to the
County shall be directed to the County's TIF Review Committee for review and approval.
6. Auburn Hills agrees that in the event that a Court determines that all or
any part of the Auburn Hills DDA failed to meet the statutory requirements of the DDA
Act, or is invalidated for any reason, upon written notice from the County, the Auburn
Hills DDA shall refund to the County the amount of County incremental tax revenues
captured by the Auburn Hills DDA that are attributed to the portion of the Auburn Hills
DDA that is invalidated by a Court. If after one hundred twenty (120) calendar days
from the date of the County's notice, the DDA fails to refund to County the amount of its
incremental tax revenues subject to this section, the County shall be entitled to reduce,
set-off, and permanently retain any amount due to Auburn Hills from the County's
Delinquent Tax Revolving Fund (DTRF") as provided below.
7. Auburn Hills further agrees that if tax increment revenue is retained by
the Auburn Hills DDA that is in excess of the County's Pro-rata Share, and if upon
written notice from the County the Auburn Hills DDA and Auburn Hills fail to tender over
to the County the excess retained tax increment revenue, then without waiving any legal
claims under this Agreement, the County shall be entitled to reduce, set-off, and
permanently retain any amount due to Auburn Hills from the County's Delinquent Tax
Revolving Fund ("DTRF") by any such amount then still due and owing the County
Auburn Hills DDA Page 7 of 9
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pursuant to this Agreement at the time the County distributes funds to Auburn Hills from
the Delinquent Tax Revolving Fund ("DTRF").
8. This Agreement sets forth the entire agreement between the County, the
Auburn Hills DDA and Auburn Hills and fully supersedes any and all prior agreements or
understandings between them in any way related to this subject matter. It is further
understood and agreed that the terms and conditions herein are contractual and are not
a mere recital and that there are no other agreements, understandings, contracts, or
representations between the Parties in any way related to the subject matter hereof,
except as expressly stated herein. This Agreement shall not be changed or
supplemented orally and may be amended only in writing and signed by the Parties.
9. The County, Auburn Hills and the Auburn Hills DDA warrant that they
each have the appropriate authority to enter into this Agreement and that each of them
are bound by the respective signatures below.
FOR AND IN CONSIDERATION of the mutual assurances, promises,
acknowledgments, warrants, representations, and agreements set forth in this
Agreement, and for other good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged the undersigned hereby execute this Agreement on
behalf of the Parties, and by doing so legally obligate and bind the Parties to the terms
and conditions of this Agreement.
Auburn Hills DDA Page 8 of 9
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THE AUBURN HILLS DOWNTOWN
DEVELOPMENT AUTHORITY
By:
Date:
THE CITY OF AUBURN HILLS
By:
Date:
OAKLAND COUNTY
By:
Name
Date:
2014-768 Contract Auburn Hills DDA
Name
Name
Auburn Hills DDA Page 9 of 9
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Phase 1 Phase 2 Phase 3
Parkways Blvd. Expansion
The continuation of Parkways Boulevard to make connection at Squirrel. Potential for developer cost
contributions as private investment ensues. (2015-2030)
$3,500,000
Supporting Activities
Business development and acquisition meetings (2015-2030)
$2,000/year
Townsquare Greenspace
Building a Townsquare Greenspace
between The Den and Ashford
Commons. (2015)
$50,000
Amphitheater*
Constructin of Aplhitheater in
Riverside Park
$1,000,000
Sidewalk Improvements
Upgrade sidewalks throughout the DDA for ADA compliance. Transition as
projects are being completed. (2020-2030)
$15,000/intersection
Riverwalk
Construction and land acquisition to connect park system along the Clinton
River. (2020-2030)
$500,000
Downtown Designation
Additional signage designating
* Shared costs with T1FA A Downtown Auburn Hills at the West
and North ends
Auburn Hills will continually search $50,000/sign
Park Improvements*
Improvements to Riverside and
Riverwoods parks
$500,000.00
for cost savings in the form of grants,
cost sharing, and contributions from
private developers for infarstructure
Clinton River Trail Paving
Paving of the Clinton River Trail
within the DDA District from Adams
to Squirrel Road
$80,000
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Resolution #15116 May 6,2015
Moved by Fleming supported by McGillivray the resolutions (with fiscal notes attached) on the amended
Consent Agenda be adopted (with accompanying reports being accepted).
AYES: Fleming, Gershenson, Gingell, Gosselin, Hoffman, Jackson, KowaII, Long, Matis,
McGillivray, Middleton, Scott, Spisz, Taub, VVeipert, Woodward, Zack, Bowman, Crawford. (19)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolutions (with fiscal notes attached) on the amended
Consent Agenda were adopted (with accompanying reports being accepted).
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1 keilEBYAPPROVE THIS RESOLUTION
CHIEF DEPUTY COUNTY EXECUTIVE
ACTING PURSUANT TO MCL 45.559A (7)
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on May 6, 2015,
with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at
Pontiac, Michigan this 6B1 day of May 2015.
Lisa Brown, Oakland County