Edina City Council makes approvals on housing, TIF and 2023 budget

“What is important here is that the demand for ice time is higher than ever and with over 400 mites, which are really entry-level players, and the amazing growth of figure skating in our town, it’s easy to project future demand,” Councilmember Ron Anderson said.

According to City Manager Scott Neal, the tax is anticipated to be an important source of revenue for the city’s construction fund, allowing the city to invest $43 million into parks over the six-year period of the city’s Capital Improvement Plan for 2023-28.

Tax levy and budget

The council voted unanimously to approve the 2023 tax levy and operating budget. The tax levy totals $49,885,000 and the city estimates it will spend $144 million in 2023 on governmental, enterprise and internal service needs, such as funding public works and other city services, park enterprises and equipment operations.

Some funds are also allocated to increase wages for city personnel to continue to attract and retain employees, hire new Edina Fire and Police staff and expand the city’s street sweeping.

“Included in that is an increase for our kind of general operating budget but also two special levies…$1 million for a special parks improvement levy and an increase in our special street levy,” City Manager Scott Neal said.

The council also voted unanimously to approve the city’s Capital Improvement Plan, or CIP, for 2023-28.

The plan is a six-year program that will spend $300 million in investments back into the city’s infrastructure, including streets, sidewalks, parks, park playgrounds, park buildings, public buildings and underground utilities, according to Neal.

Sixty-three percent of CIP funds will go toward infrastructure, 14% to parks, 14% to buildings, 8% to equipment and vehicles and 1% to technology, according to the Dec. 6 City Council meeting agenda packet.

Multifamily housing

The council also voted unanimously to approve a redevelopment agreement for multifamily housing at 4620 W. 77th St.

The redevelopment will create 276 new housing units, 28 of which will be affordable to households with income at or below 50% of the area median income. One hundred and ten units will be rent restricted not to exceed 120% of area median income.

The project will be funded through up to $7.35 million in Pentagon Park TIF District pooled funds and up to $2 million in Special Projects and Redevelopment Capital funds.

TIF Policy

The council also voted unanimously to approve the city’s updated TIF policy.

The city’s TIF policy began in the early 1970s when the HRA was created, according to Bill Neuendorf, Edina’s economic development manager. The policy was most recently updated in 2011.

“It serves our basic needs just fine but there’s always questions about tax increment and there’s questions from the community, questions from developers and so it’s our recommendation to update the policy to address a lot of those questions,” Neuendorf said.

The updated policy focuses on six objectives, including clarifying the intent and purpose of when TIF can be used, clarifying the review process, setting expectations regarding transparency, identifying parameters when creating a TIF District, clarifying minimum expectations for developers and establishing clear financial guidelines.

Neuendorf emphasized that most projects in Edina are privately financed and using TIF funds should be designated for “exceptional projects that have unusual situations, excessive costs or just would not otherwise be met by the private sector without the use of TIF.”

“We want to make it clear that we would provide support for exceptional projects, not projects that meet the bare minimum standards but those that really aspire and strive to meet the ideals that we’ve defined as a community,” Neuendorf said.

The updated policy also includes clarifications at the request of councilmembers Anderson and Kevin Staunton, including clarifications about when TIF should be used to finance public needs, such as garages, roads and sewers.

“We don’t want to preclude ourselves from using TIF when it makes sense for a publicly financed project,” Neuendorf said.