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2. The agreement also states that the "remaining $200,000 of TIF would be for lateral water and sewer connection fees to the City of Blaine.... and would be prorated among the benefited lots based upon the proportionate square footage of each lot to the total square footage of all the lots....". Calculating the prorated share of the $200,000 for lot 3 equals $61,000 or $0.49 per sq.ft. of assistance. 3. In addition to the TIF assistance for lateral water and sewer hookup and construction of the live storage pond, there is a request by MidWest IV for $242,000 of assistance for the project. This equals $1.94 per sq.ft. of assistance at the 7% for nine years. Total assistance package, if approved, equals $333,000 in present value terms or $2.67 per sq.ft. Attached is a draft proforma analysis of the project based on the company's financials, total cost of the project, bank terms and lease arrangements. The company will be applying for a SBA 504 loan agreement which reduces the amount of interest on 40% of the total loan package. Financial Consultant, Gary Fields notes that historically, MidWest IV is a strong, growing company with profits before tax of$80,000 last year and $140,000 for the first two quarters of 1995. The analysis includes proforma analysis with total TIF assistance, without TIF assistance and with partial TIF assistance. The investor's cash on cash return varies from approximately (4)% without TIF to between 5-29% return with TIF. Typically, developers require a 20-30% return prior to investing in a project. This analysis is a draft since Gary Fields was on vacation last week. I will provide any changes at the work session on Monday. The company shows a need for financial assistance according to the proforma analysis. In addition, there are several intangible elements that make the use of TIF attractive for the City on this project. These intangibles include EDA control of the type and quality of the development, adequate landscape screening from the Bridges to the south and passive recreational area to the west of the project and attraction of a high tech development that will set the stage for future development of lots 1 & 2. In addition, the area does contain wetlands which requires careful planning and an investment of proper drainage capacity. Currently, Midwest IV is negotiating the purchase of lot 2 which would be used for expansion of the facility in the future. Assistance to Midwest IV for this corporate headquarters facility will allow them to invest more dollars into the growth of the business. Successful growth of the business means expansion with increased jobs and tax base. If you have any questions with regards to this proposal prior to Monday's work session please feel free to call me or Samantha. BUILDING PLANS AND SPECIFICATIONS: There are several items with regard to the construction of the building that need to be discussed in relation to the TIF agreement. These include stormwater drainage plan, building design and layout, landscaping plan and parking requirements. These issues have been discussed at the Planning Commission level and are outline by Paul Harrington on the following pages. _ . A AAA 'I/ Cathy Be►, e , conomic Development Coordinator