02-26-1998 - Laserfiche WebLink

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9Aki To: Economic Development Commission Members From: Rick Jopke, Community Development Director M{IIORAIIDUM Subject: Silverview Estates Tax Increment Assistance Request )ate: February 23, 1998 BACKGROUND Project: Silverview Estates; Inc Is proposing to construct a mixed use project on a 13 acre site on the southeast corner of Silver Lake Road and Highway 10. Proposed uses include a Holiday convenience market/gas station/car waski,.a 25,000 square foot, two story office building, a 5,000 square foot, one story office building and an 82 unit market rate senior rental housing building. A 4.5 acre wet! Trd would be maintained on the site. City Approvals: In May of 1997 the City Council approved Ordinance No. 599 approving the PUD rezoning for the site and Resolution No. 5127 approving the general concept PUD plan. In December of 1997 the City Council approved Resolution No. 5 183 approving a preliminary plat for the site and Resolution No. 5 184 approving a development stage PUD plan. It is anticipated that a final plat for the property will be presented for City approved on • March 9, 1998. TIF Assistance Request: In November of 1997, Silverview Estates, Inc. submitted a request for tax increment assistance for the project. They have asked for pay-as-you-go tax increment assistance equal to 90% of the projected increment with respect to each component of the project. While no assistance is being requested to assist the Holiday Station Store, they have requested that 90% of the increment generated by the Holiday Station Store be allocated to the senior housing project. The proposed term of the assistance is 13 years. Initial projections indicate, that on a present value basis, the developer's request would equal approximately $1.7 million dollars.The developer has indicated that the assistance is necessary to make the project financially viable. According to the developer, without the assistance, the amount of profit anticipated to be generated by the projects is not adequate to compensate the owner for the required equity investment.A copy of Silverview Estates, Inc application for tax increment financing is attached. Staff/Consultant Analysis: the City has contracted with Mr.Jim Casserly with the firm of Krass Monroe to review the request. Mr. Casserly has reviewed the request and based on how the project is currently proposed indicates that it would be reasonable to provide total pay-as-you- go tax increment assistance equal to approximately$1 ,000,000 ($167,000 for the office buildings and $830,000 for the senior housing project). A copy of Mr. Casserly's report is attached. City staff would concur with Mr. Casseriy's analysis that$1 ,000,000 would be a • reasonable amount of assistance based on the type and amount of assistance typically approved for these types of projects. This would equate to 4 years increment for the office ■