DEPARTMENT: Physical Development Administration
FILE TYPE: Regular Action
TITLE
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Reaffirmation Of Base Levy And Approval Of 2027 Incremental Levy For Dakota County Community Development Agency
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RESOLUTION
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WHEREAS, the Dakota County Board of Commissioners (Board) has determined that the availability of accessible, affordable housing and economic development activities are necessary components of a vital, sustainable economy in Dakota County; and
WHEREAS, the Dakota County Community Development Agency (CDA) has the powers of a Housing and Redevelopment Authority and Economic Development Authority within Dakota County; and
WHEREAS, there continues to be a substantial gap between the demand for affordable housing and economic development activities in Dakota County and financial resources for such activities, and additional capital for the CDA to support these activities is desired to contribute to a vital, sustainable economy in Dakota County; and
WHEREAS, the CDA develops senior and workforce housing financed using housing revenue bonds with the pledge of general obligation backing by Dakota County, as approved by the Board; and
WHEREAS, the Board has previously approved the ongoing base levy by the CDA of special benefit taxes at a rate of .0144% of Estimated Market Value to support debt service payments for the CDA bond-funded developments; and
WHEREAS, the CDA is authorized under Minn. Stat. § 469.033, subd. 6, with the approval of the Board, to levy additional special benefit taxes, up to an amount of .0041% of Estimated Market Value (the incremental levy) for a total levy of .0185%; and
WHEREAS, the CDA is requesting approval of an incremental levy of .0012% for a total levy of .0156% of Estimated Market Value; and
WHEREAS, the incremental levy would provide the CDA with an estimated $942,499 for CDA-supported programs; and
WHEREAS, the approval of the incremental levy applies only to taxes payable in 2027.
NOW, THEREFORE, BE IT RESOLVED, That the Dakota County Board of Commissioners hereby reaffirms the Dakota County Community Development Agency’s base levy rate of .0144% of Estimated Market Value and approves the Community Development Agency’s incremental levy of .0012% of Estimated Market Value, for a total Community Development Agency levy rate of .0156% of Estimated Market Value for taxes payable in 2027 for the purpose of providing affordable housing and supporting economic development activities in Dakota County through the Community Development Agency’s Common Bond Development Program and other Community Development Agency-supported programs.
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BACKGROUND
Minn. Stat. § 383D.4 authorizes the CDA to levy special benefit taxes at the higher of the rates allowable under Minn. Stat. §§ 383D.41, 469.033, and 469.107, with approval by the Dakota County Board (County Board). Of the applicable statutes, the highest rate is in Minn. Stat. § 469.033, which states that the current maximum amount the CDA is permitted to levy is .0185% of the County Estimated Market Value.
In 1994, the County Board granted the CDA the authority to request levy funds up to the amount permitted by law without subsequent approval from the County (Resolution 94-926). This ongoing authority provides stability for debt service payments required for the outstanding bonds issued to develop CDA-owned and -operated affordable senior and workforce housing apartments. Historically, the CDA has sought County Board approval for the levy increment beyond the .0144% limit that was in place at the time of Resolution 94-926. The incremental levy is the difference between the maximum permitted by statute (.0185%) and the ongoing amount previously authorized by the Board (.0144%).
For 2027, the CDA is requesting approval of incremental levy authority of .0012%. The levy rate is the same as 2026. Approval of this levy request applies only to the levy of taxes payable in 2027, and the levy amount is based on the final pay year 2026 Estimated Market Value in the County. The requested incremental levy authority is projected to provide approximately $942,499 for CDA-supported programs.
RECOMMENDATION
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Staff recommends reaffirmation of the .0144% base levy and approval of the .0012% incremental special benefit levy for the Dakota County CDA to address affordable housing needs in Dakota County.
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FINANCIAL AND STAFFING IMPACTS
The requested 2027 incremental levy rate of .0012% of Estimated Market Value is expected to generate $942,499 in revenue for the CDA. If the incremental levy is approved, it will be added to the .0144% base levy rate, for a total CDA levy rate of .0156% of Estimated Market Value. This total levy is expected to generate $12,252,495 in revenue for the CDA, of which $5,600,000 will be used to pay debt service for the CDA bond-funded developments. The 2027 levy funds will be included in the CDA’s Fiscal Year-End 2028 budget, which runs from July 1, 2027, to June 30, 2028.
PREVIOUS BOARD ACTION
94-926; 12/6/94 Ongoing CDA levy authority
ATTACHMENTS
Attachment: 2027 Dakota County CDA Levy Budget
Attachment: Presentation Slides
CONTACTS
Department Director: Erin Stwora
Author: Lisa Alfson