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Council approves Heights redevelopment TIF to fund urgent parking-structure repairs
Summary
Bloomington City Council approved a redevelopment tax-increment financing district for the Heights condominium to fund restoration of a deteriorating parking structure, following staff findings the garage is structurally substandard and that the project requires TIF to proceed.
The Bloomington City Council voted 7-0 Feb. 24 to establish a redevelopment tax-increment financing (TIF) district for the Heights condominium to help pay for a major renovation of the property's parking structure.
City economic development staff and the Housing and Redevelopment Authority (HRA) told the council the Heights parking structure has been determined structurally substandard and had its certificate of occupancy revoked. Kenny Niemeyer, HRA staff, said the financing package combines bonds, an interfund HRA loan and a TIF district to reduce assessments and secure repayment over a 20-year term. "The restoration of that parking structure will ensure the condominium is compliant with our zoning requirements for minimum parking minimums," Niemeyer said.
The council and HRA previously approved a local affordable housing aid grant of $250,000 to provide direct income-based assistance; staff said six households applied and qualified, five owner-occupied and one rental unit. Third-party consultant Doug Strainness, who has worked with the Heights for eight years, warned the garage is "on the verge of collapse" and that failure could leave the building uninhabitable. Resident Melanie McCallum said she bought a unit for her daughter and described the process as an emotional "roller coaster." Niemeyer said, should the council and HRA finalize approvals and the negotiated bond sale proceed, construction could start in May with completion by the end of 2025.
The planning commission earlier declined to make one of the statutory findings that a TIF plan "conforms with the general development plans for the city as a whole," citing concerns about using TIF for this project; the council's resolution explicitly included that finding. Staff said the project would not proceed in its currently approved form without TIF because the affordability elements of the financing package depend on it.
Next steps outlined by staff include HRA final approval (scheduled for the next day), entry into a development agreement between the HRA and the Heights Condominium Association, and acceptance of a negotiated bond sale later in spring to set final interest and assessment amounts.
If the HRA and council actions are completed, staff will record assessments with Hennepin County and proceed with construction procurement and start. The council made no additional changes to the development agreement details at the meeting.
