06-23-2025 Workshop Packet - Laserfiche WebLink

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Table 2b: Estimated Tax Increment Revenues based on reduced 5 Years to support up to $200,000 as related to lift station and force main improvements Preliminary revenue projections based on reduced-year term Existing Base Land Value $264,100 Estimated Total Taxable Value $21,200,000 Estimated annual available increment (full buildout) $59,162 Total gross tax increment (5 years) $308,037 City retainage (10%) $30,803 Net amount available for development (90%) $277,234 Estimated Present Value Revenues (5 Years) at 5.5% $200,000 Table 2c: Estimated Tax Increment Revenues based on reduced term (15 and 18) Years Preliminary revenue projections based on reduced term of district 15 Years 18 Years Existing Base Land Value $264,100 $264,100 Estimated Total Taxable Value $21,200,000 $21,200,000 Estimated annual available increment (full buildout) $59,162 $59,162 Total gross tax increment (26 years) $1,024,837 $1,269,357 City retainage (10%) $102,482 $126,934 Net amount available for development (90%) $922,355 $1,142,423 Estimated Present Value Revenues (26 Years) at 5.5% $543,619 $623,209 The City has the option to consider providing tax increment to the project following receipt of the developer’s request for tax increment assistance. There are also considerations as to the level and terms of assistance. As discussed previously, the developer has included the maximum term of tax increment collections from a housing district (up to 26 years) that results in the greatest level of TIF assistance. Considerable discussion at the June 11 City Council workshop resulted in discussion of a reduced term focusing on identified costs. Table 2b above reflects that discussion with focus of TIF assistance on approximately $200,000 (plus interest) as related to lift station improvements. The City may also offer alternate terms of assistance (15 -18 years) that aligns with the term of the cash flow projections, or no assistance at all, in which case the developer will be required to find alternate sources (including potential grant funding from LCDA and other potential grant sources) to close the financing gap. The developer has also indicated local support through TIF results in a stronger application for debt financing and tax credit equity that is necessary for the project to proceed. Feasibility of alternate levels of assistance are anticipated to be subject to additional review and discussions with the developer. The developer has stated that local support from the City will be necessary to be awarded LCDA funds and any potential additional funding sources (i.e. DEED) as the grant funding would be awarded to the City of Little Canada. The grant funds require commitment and submission of the application by the City and with commitment as related to financial participation through TIF. Alternate possibilities for closing the gap are subject to financial feasibility and market conditions including increased deferred developer fee, reduced interest rates, other grant funding sources and increased debt coverage.