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 $2,825,000 <br />• Incremental value based on difference between existing and new land/building value <br />• Construction commences and is completed in 2021 <br />o Project values 100% complete for assess 2022 and taxes payable 2023 <br />• First abatement collection in 2023 <br />• Final year collection in 2036 <br />• Maximum term of abatement <br />o 15 years if all three taxing entities participate or <br />o 20-years if one taxing entity declines participation or 90 days pass from initial participation <br />request <br />o Abatement term is 2017-2036 <br /> With written denial of participation from the School District <br />• Annual market value inflator <br />o 0% <br />o 3% <br /> <br />Tax Abatement Revenue Estimates <br /> <br />Tax Abatement Revenue Projections <br /> <br />Annual Market Value Inflator 0% 3% <br /> <br />City Share Total Estimated Annual Revenue Full Buildout $25,920 $25,920 <br />County Share Total Estimated Annual Revenue Full Buildout $26,584 $26,584 <br />School Share Total Estimated Annual Revenue Full Buildout $0 $0 <br /> <br />Total Gross Revenues $52,504 $52,504 <br /> <br />Estimated City Share (14 Years) $362,880 $442,878 <br />Estimated County Share (12 Years) $312,300 $369,348 <br />Estimated School District Share <br /> <br />Total over Remaining Number of Years $675,180 $812,226 <br /> <br />The City and County approved a tax abatement for the original building construction for Sportech in 2015. The <br />City approved a 15-year term and the County approved a 12-year term. Due to location of the building <br />expansion on the same property and within the existing tax abatement, the maximum level of assistance that <br />could be provided must fit within the remaining term of tax abatement (up to 20 years total). The first year of <br />abatement was 2017 and the final year with a full 2-year term would be 2036. Based on current assumptions <br />for construction of the expansion, the maximum number of years for the City share of tax abatement assistance <br />would be 14 years (2023-2036). <br /> <br />Applicant Pro forma Analysis including But-For <br />In approving an abatement project, the Elk River EDA and City Council have requested that a finding be made <br />that the proposed project would not reasonably be expected to occur solely through private investment within <br />the reasonably foreseeable future. The City’s tax abatement policy outlines the considerations for which tax <br />abatement may be considered as a financing tool. The policy also includes a provision for which the but-for test <br />need not be met if the assistance for a project is considered more as a “location incentive”. Public benefits may <br />include significant tax base increase, the creation of higher paying jobs (at least twice the minimum hourly rate <br />stated in the city’s Business Subsidy Policy), and is likely to assist in the marketing and attraction of additional <br />desired developments. <br /> <br />The applicant has provided minimum expected job creation (85 new FTE) and wage goals (average $23.04 with <br />benefits) based on completion of the business expansion. Without financial assistance, it will not be committed <br />or required to meet those job and wage goals. Financial assistance from the City allows for additional revenues <br />to provide sufficient project cash flow and market returns to investors that will achieve project feasibility and <br />facilitate the targeted job creation and wage goals. The applicant has stated the assistance will offset a portion