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City of Little Canada Page 2
<br />Fiscal Disparities Analysis April 2022
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<br />The next step in the process is to convert the distributed tax base into levy dollars. This is done by
<br />multiplying the distribution value by the prior year’s tax rate. In the case of Little Canada,
<br />$2,025,834 is multiplied by the Pay 2021 city rate of 23.982896%, which equals $485,853. This
<br />dollar amount is subtracted from the certified levy of $3,761,410 the City passed last December.
<br />The net amount of $3,275,557 is the numerator used to calculate the City’s Pay 2022 tax rate.
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<br />IMPACT OF FUTURE DEVELOPMENT
<br />A common question is how can cities increase their distribution amount from the Pool. For
<br />singular housing projects the impact tends to be minimal. However, it is worth exploring the
<br />impact of five new developments that are slated to occur in the City in the next 2-3 years. They
<br />are:
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<br />This is a total of 449 new units that can add significant value to the City’s tax base and have the
<br />following implications:
<br />1) Increased tax base, which can lower the City’s tax rate, assuming no increase in services are
<br />required, OR show how much the City can increase the certified levy and still maintain the
<br />same tax rate as the prior year,
<br />2) None of the development listed above is commercial, so no additional contribution will be
<br />made to the Pool,
<br />3) May increase in the amount of distribution value and dollars received from the Pool,
<br />assuming no other changes to the City’s tax base and no other changes to the Pool.
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<br />The analysis below includes the following assumptions:
<br />1) Estimated market values per unit for:
<br />a. Single family homes is $750,000
<br />b. Townhomes is $340,000
<br />c. Market rate apartments is $225,000
<br />d. Affordable rate apartments is $175,000
<br />2) Construction occurs over 2 – 3 years
<br />3) Assumes 2.25 residents per unit
<br />4) Assumes no other changes to existing market values from the prior year
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<br />Based on the assumptions above, the City can project an increase in the total estimated market
<br />value for the City of $124.1M over four years. This is an increase of 9.7% over the Pay 2022 total
<br />estimated market value of $1,274.5M.
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<br />
<br />Development Name # of Units Completed
<br />Gervais Woods Second Addition - Single Family Homes 15 12/31/2024
<br />Lennar Subdivision - Owner occupied townhomes 184 12/31/2024
<br />Twin Lake Blvd - Affordable multi-family (Phase 1)60 12/31/2023
<br />Twin Lake Blvd - Affordable multi-family (Phase 2)60 12/31/2025
<br />Rice Street Multi-Family - Market rate apartments 130 12/31/2024
<br />2022 Construct 2023 Construct 2024 Construct 2025 Construct
<br />Development Name # of Units Pay 24 Value Pay 25 Value Pay 26 Value Pay 27 Value
<br />Gervais Woods Second Addition - Single Family Homes 15 -$ 5,625,000$ 5,625,000$ -$ 11,250,000$
<br />Lennar Subdivision - Owner occupied townhomes 184 15,640,000 31,280,000 15,640,000 - 62,560,000
<br />Twin Lake Blvd - Affordable multi-family (Phase 1)60 5,250,000 5,250,000 - - 10,500,000
<br />Twin Lake Blvd - Affordable multi-family (Phase 2)60 - - 5,250,000 5,250,000 10,500,000
<br />Rice Street Multi-Family - Market rate apartments 130 - 14,625,000 14,625,000 - 29,250,000
<br />TOTAL 449 20,890,000$ 56,780,000$ 41,140,000$ 5,250,000$ 124,060,000$
<br />VALUE
<br />INCREASE
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