3.0. EDSR 11-09-1998 - Laserfiche WebLink

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EDA Worksession Agenda Memo November 9, 1998 Page 3 40 remediation. If these dollars are to be provided by the EDA up front, an additional bond would be sold, thereby increasing our risk. All the other costs being discussed to be provided up front are essentially being assessed back to the industrial piece, thereby providing excellent security for the bond which would be sold to complete such activities. The EDA would have to rely upon build-out of the industrial park and generation of increment over time in order to recoup the $600,000 provided up front to the project for mass grading and wetland remediation. The industrial project is proposed to be completely built out in years 5-7 with approximately 350,000 square feet of industrial space. The proposed market value of land and buildings at full build out is approximately $18 million. Commercial Component Associated Developers' request for tax increment for the commercial component of this project is in the amount of approximately$2.7 million. Staff and developer discussions have led to a reduction in this original TIF request from $2.7 million to approximately $1.6 million. This revised request includes the following line items: • gas pipeline relocation $ 350,000 • public improvements to be assessed $ 627,000 • • 40% of the cost of soil corrections and grading $ 638,060 Total Revised TIF Request $1,600,000 (rounded) To date staff has discussed the concept of agreeing to provide tax increment to reimburse the developer for the costs of public improvements in the amount of$627,000. In addition, staff has discussed the concept of agreeing to provide tax increment to pay the actual cost of the gas pipeline relocation. Of these costs being discussed,the $627,000 for public improvements would be included as part of the overall city general obligation bond and installed up front to the project and assessed back to the commercial component of the project. This assessment, as with the industrial piece, provides a strong security mechanism to reduce the risk of the project for the city. Any dollar amount agreed to be provided over and above $627,000 for public improvements, would be proposed to be paid for up front by the developer with a reimbursement from tax increment being provided over the term of the tax increment district. For example, if the EDA were to agree to provide an additional $350,000 to pay for gas pipeline relocation, Associated Developers would pay this cost up front and agree to be reimbursed with tax increment • over the life of the district at a negotiated interest rate.