7.3. SR 07-20-2015 - Laserfiche WebLink

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City of Elk River, Minnesota Envision Co., LLC (Sportech) request for Tax Abatement June 23, 2015 Page 3 Tax Abatement Revenue Estimates Envision Co., LLC (Sportech) Abatement Project Scenario 1 Scenario 2 Scenario 3 Scenario 4 Participation and Number of Years City Yes – 15 Years Yes – 20 Years Yes – 15 Years Yes – 20 Years County No No Yes – 12 Years Yes – 15 Years Estimated Annual Tax Abatement Revenue Estimated City Share $49,136 $49,136 $49,136 $49,136 Estimated County Share $54,123 $54,123 $54,123 $54,123 Total Estimated Tax Abatement Revenues Estimated City Share $699,924 $945,605 $699,924 $945,605 Estimated County Share $608,587 $770,955 Estimated Total Combined Revenues $699,924 $945,605 $1,308,512 $1,716,560 The above table illustrates the projected net revenues that tax abatement would generate based on various terms of collection. The application for abatement assistance includes a proposed term of 20 years for the City and 15 years for the County with an estimated total abatement revenue amount as requested from the City of $982,722 and $811,845 from the County. Assuming partial value is realized in the first year (2017), the estimated abatement amounts are summarized above. The maximum abatement term for the City is up to 20 years if only 1 or 2 entities participate in the abatement or the City receives written denial of participation from one of the other taxing entities (County or School District). The company has previously requested participation from the School District and has received a letter of denial of participation. All participation levels and amounts would be subject to individual policy and Board decisions following anticipated public hearings. Revenues captured through tax abatement and provided as reimbursement to the property owner for certain costs must be used only for those properties that benefit from the tax abatement. Developer Request for Tax Abatement Assistance The developer submitted a request for tax abatement assistance from the City of Elk River and Sherburne County to assist with financing the proposed $9.7 million acquisition and subsequent construction of an approximate 105,000 square foot facility on current City-owned property located in the 2nd phase of the Nature’s Edge Business Center. The developer has requested approximately $982,722 in abatement assistance over 20 years from the City and $811,845 over 15 years from the County. The Developer’s submittal includes a preliminary total project budget of $9,696,330 as shown in the table on the following page.