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Local development authority recommends 504 Development LLC TIF plan for 39‑unit apartment near school
Summary
The body voted to recommend the draft tax‑increment financing (TIF) plan from 504 Development LLC to the city council; staff said the plan estimates about $2.1 million in TIF funds for site work, bond interest and administration and a public hearing is set for April 9 at 6 p.m.
A Kasson City development meeting voted to recommend a draft tax‑increment financing plan from 504 Development LLC to the city council, advancing a proposed development near the school that staff said would include a 39‑unit apartment building and a four‑unit townhome.
The Coordinator presented the plan and said, “They're estimating a little over $2,100,000 in TIF funds going towards the project, including site improvements, bond and note interest payments and administrative costs.” The Coordinator said the staff packet contains a draft TIF plan and that the city council has called a public hearing on the matter for April 9 at 6 p.m. in this room.
Why it matters: The draft plan would use increment financing to cover upfront project costs, delaying tax receipts to regular rolls until the TIF expires. Staff said the analysis was run on a longer (25‑ to 26‑year) window although the developer requested roughly 12–13 years; the authority can authorize the full window or set a shorter term or end the TIF early.
Discussion and concerns centered on parking and whether the development meets the "but‑for" test used to judge whether the project would occur without TIF. A Committee member moved for a recommendation, saying, “I would vote to recommend approval of the draft TIF plan as presented.” The Chair stated there was a second; the City Administrator recorded a voice “Aye” during the vote. Staff noted the loan/financial aspects appeared sound but that some site‑development concerns remain and that the school (represented by Bob Hayes, cited by staff) had raised parking questions.
Staff described possible mitigation options for school‑time congestion, including restricted parking on one side of the street or time‑limited no‑parking during school hours. The City Administrator said those measures could address the school’s concerns.
Next steps: The authority recommended the plan to the city council for the April 9 public hearing, where the council will receive public input and then decide whether to adopt, amend or reject the TIF plan.
