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City of Elk River, Minnesota <br />Tax Increment Applications for Proposed Jackson Hill Residential Suites Housing Project and <br />Elk River Lodge and Residential Suites, LLC <br />January 25, 2018 <br />Page 3 <br />Maximum term of housing district (26 total years) <br />Increment based on difference between existing land value and new land/building value <br />Construction commences in 2018 and is completed in 2018 <br />o 100% assessed in January of 2019 for taxes payable in 2020 <br />Payable 2017 tax rates remain <br />o City: 46.193% <br />o County: 50.458% <br />o School: 36.659% <br />o Other: 4.509% <br />o Total 137.819% <br />Class rates remain constant through term <br />o Residential rental rate of 1.25% <br />o Classification of existing property as rental <br />0% annual market value inflator assumed <br />Present Value assumptions <br />0 4.5% discount rate <br />0 8/1/18 present value date <br />Developer PayGO <br />0 90% pledged to developer <br />0 10% retained by City <br />Tax Increment Revenue Estimates (Jackson Hills) <br />The tax increment revenue estimates are based on collection of revenues for the full term of the Jackson Hills <br />housing TIF district. Based on the assumptions previously outlined, the projected tax increment revenues to be <br />generated from the project are shown in the chart below. Actual revenues generated by the project will be based on <br />realized assumptions once the project is constructed and may be altered. <br />Jackson Hills Residential Suites Housing Project <br />TIF Amounts <br />Total Gross Tax Increment (26 years) <br />$1,340,872 <br />City Retainage (10%) <br />$134,082 <br />Net Amount Available for Project(s) (90%) <br />$1,206,790 <br />Developer Requested Terms <br />25 years of tax increment at 90% <br />$1,206,790 <br />Estimated Present Value at 4.5% <br />$677,707 <br />Total estimated maximum amount per City policy (15 years) <br />$773,580 <br />