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Council approves amended downtown TIF spending plan, extends spending window to 2026
Summary
The Rosemount City Council held and closed a public hearing and unanimously adopted an amended and restated TIF spending plan that addresses interest earned on transferred funds and extends the spending deadline into 2026, enabling flexible use of about $2.72 million previously transferred to a TIF account.
The Rosemount City Council on Aug. 19 adopted an amended and restated tax increment financing (TIF) spending plan that updates how interest on a transferred increment is treated and extends the council's spending window into 2026. The council held a public hearing and voted 5-0 to approve the amendment.
City staff said the amended plan responds to a 2025 state statutory change that clarified interest earned on funds transferred into a separate account is treated as part of that transferred increment. "The way the document is stated is that would it be amended and restated spending plan, so it just replaces the other one," a city financial consultant said during the meeting, describing the redlined changes in the packet.
Staff noted the city previously transferred $2,720,000 into an account that has been earning interest; the consultant said the account had earned "another $104,000 and change" as of February 2024. The amended plan allows the city and Port Authority to spend between $25,000 and $500,000 on eligible projects using these funds and addresses how interest should be treated following the legislative change. The amended plan also provides a one-year extension so the funds can be spent through February 2026, as described by staff.
No members of the public spoke at the hearing. After closing the hearing, the council voted to adopt the amended and restated spending plan; the motion was moved and seconded by council members during the meeting and passed unanimously.
City staff said funds that are not spent under the amended plan will revert to the TIF account and remain governed by TIF rules. Staff also noted that while the transferred account allows more flexible use (including equity contributions to private developments), if not expended within the amended timeline the money will continue under the original TIF constraints. The consultant offered to answer questions; none were raised by council members at the meeting.
