Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
2A, Presbyterian Homes Tax Increment Financing Contract
,--AIZEN�HILLS Request for Council Review 2A Prepared By: Patrick Klaers,City Administrator Jill Hutmacher,Community Worksession Date: December 13,2010 Development Director Presbyterian Homes Tax Increment Financing Contract Discussion Topic: - Discussion of the proposed terms for the Presbyterian Homes TIF contract. Supporting Documents: 1. Memorandum dated December 13, 2010,from Patrick Klaers and Jill Hutmacher. 2. Map of Development District No 1 with TIF District No. 4 3. Procedure for Application to the City of Arden Hills for Private Activity Revenue Bond Financing 4. Ehlers Presbyterian Homes Proforma Review 5. Comparison of Conduit Debt Issuance Fees 6. TIF Background Calculations 7. TIF Model Including$1.115 Million in Assistance Provided over 14 Years 8. TIF Model Including$1.4 Million in Assistance Provided over 16 Years EN HILLS MEMORANDUM DATE: December 13, 2010 TO: Mayor and City Council FROM: Patrick Klaers, City Administrator - Jill Hutmacher, Community Development Director SUBJECT: Presbyterian Homes Tax Increment Financing Contract Background At the December 6, 2010 City Council work session, the City Council discussed the proposed terms of the Presbyterian Homes TIF Contract as follows: • Minimum Improvements including 90 units of independent living, 76 units of assisted living, and 36 units of memory care • A phased construction timeline to commence no later than December 31, 2011 and be completed no later than December 31, 2016 • Repair of City sewer line on the Presbyterian Homes property to be paid by the Developer • Reconstruction of County Road D adjacent to the development property with 50% of the cost(City's share)to be paid by the Developer • Conveyance of the Triangle Parcel to the City for $1.00 o Site must be cleared and seeded o Site will be provided with clear title and clean environmental o Closing to occur no later than June 30, 2012 o Closing costs to be split as customary for market transactions • Total tax increment assistance of $1,115,000 plus 6.25% interest to be paid to the Developer over no more than 14 years o Developer will collect 90%of increment generated in years 1-5 o Developer will collect 75% of increment generated in years 6-14 o City will collect administration and pooling revenue not to exceed 20% of total revenue over the life of the district City of Arden Hills City Council Special Work Session December 13, 2010 Page 1 of 4 • The contract will include a lookback mechanism for comparing projected costs with final actual costs, and potentially reducing the amount of the TIF Note if there are sufficient cost savings • Developer will pay the City's legal, financial advisor and any other out-of-pocket costs up to the approval and execution of the Contract. • The City will issue housing revenue bonds (conduit debt) for the project. The Developer will pay an up-front lump sum fee of 1%of total bond proceeds. • The Development District will be amended and will include all parcels south of a line running west on Highway 96 and northwest on Highway 10 to Interstate 3 5 W (see Attachment A) Nearly all of the issues listed above have been successfully negotiated and inserted into the TIF - Contract. Please see Item 6.13 in the regular City Council meeting agenda packet for the draft TIF Contract. As is common in large, complex redevelopment projects, a few items remain to be resolved prior to Council approval of the documents related to tax increment financing. The remaining issues are described in this memo and its attachments. Environmental and Title Concerns on Triangle Parcel Presbyterian Homes is clearing a title cloud on the triangle parcel. Discrepancies in the legal descriptions of the triangle parcel and the adjacent parcel to the north have resulted in a gap between the recorded legal descriptions of the two parcels. The gap is 1.32 feet at its widest point, narrowing to 0 feet. The legal descriptions of the two parcels will be corrected to eliminate the gap. The City has some indication that the triangle parcel was operated as a gas station in the 1950's. Presbyterian Homes believes that one or more buried fuel tanks may still be in place. Presbyterian Homes will order Phase I and II reports on the property. With the results of those reports, the City will direct Presbyterian Homes to initiate cleanup activities. Presbyterian Homes has requested a cap of$25,000 on their liability for cleanup. If cleanup costs will exceed $25,000, the City can either: 1. Close on the property and assume responsibility for the remaining cleanup costs 2. Decline to accept conveyance of the property Conduit Debt Issuance Fees At the December 6 meeting, staff and consultants presented that the City's conduit debt policy allows developers to choose between a fee that is either 0.125% (1/8 of 1%) annually of the outstanding bond amount, or an up-front lump stun fee of 1% of total bond proceeds. Upon further review of our policy, it is clear that while our policy allows for an up-front lump sum fee, the policy does not specify what that fee should be. The policy leaves the determination of the fee to the discretion of the City Council (Attachment B). City of Arden Hills City Council Special Work Session December 13, 2010 Page 2 of 4 Since the December 6 meeting, Presbyterian Homes has notified the City that a 1% lump sum fee cannot be supported by their proforma. They have budgeted for a 0.25% lump sum fee, or approximately $100,000. The proforma review completed by Ehlers shows an issuance fee of $100,250 (Attachment Q. Staff and consultants have researched conduit debt issuance fees in Twin Cities communities (Attachment D). While lump sum fees of 1% are common in surrounding communities, cities which commonly have large bonding requests have mechanisms in their policies to mitigate the size of fees for large projects. Those cities have determined that the administrative costs of conduit debt issuance for larger bonds are not significantly higher than for smaller bonds to justify larger fees. The Developer has indicated that it cannot proceed with the TIF package as proposed if the conduit debt fee remains at 1%. Because the tax increment is structured as pay-as-you-go, the Developer bears the risk of tax increment being less than projected due to tax law or value changes. Between the risk associated with the pay-as-you-go note and the expenses and/or liabilities that the Developer will incur related to the negotiated TIF package, the Developer stipulates that a 1% lump sum fee diminishes the value of the TIF package to the point where it is no longer useful to the Developer. Value of Tax Increment Package to the City of Arden Hills The TIF package negotiated includes several items of value to the City of Arden Hills as summarized below. Cost estimates for the value of the triangle parcel and potential redevelopment costs are conservative budget numbers for costs that the City would incur if it chose to acquire the property in an arm's-length transaction. Sewer improvement $65,000 Reconstruction of County Rd D $75,000 Value of Triangle Parcel (2010 assessed value) $268,000 Potential Triangle Redevelopment Costs $150,000 (cleanup, title, clearance, etc) TIF Administration and Pooling $414,000 Conduit Debt Fee (as proposed by PH) $100,000 Total Value of TIF Package to Arden Hills $1,072,000 Additional Information To assist with Council analysis, the assumptions, rates, base value information, and tax calculations are provided in Attachment E. The 14-year TIF model as discussed on December 6 is included in Attachment F. Responses from Stacie Kvilvang, Ehlers and Associates, to Council questions regarding County road improvements, private financing, and calculation of an on- going 1/8 of 1% issuance fee are provided in Attachment G. City of Arden Hills City Council Special Work Session December 13, 2010 Page 3 of 4 Options Several options are available to the City: Option 1: Reduce the conduit debt issuance lump sum fee. Option 2: Increase TIF assistance by $286,000 (difference between Developer proforma and 1% fee) and extend the district to 16 years (Attachment H). Option 3: Retain the 1% Iump sum fee and acknowledge that the Developer may decline the TIF package. Option 4: Approve the TIF contract except for the issuance fee and decide on that at a later date. Recommendation Staff supports all options except Option 3 due to the significant benefits to the City's long-term goals that the TIF package provides. Attachments A. Map of Development District No. 1 with Tax Increment Financing District No. 4 B. Procedure for Application to the City of Arden Hills for Private Activity Revenue Bond Financing C. Ehlers Presbyterian Homes Proforma Review D. Comparison of Conduit Debt Issuance Fees E. TIF Background Calculations F. TIF model including $1.115 million in assistance provided over 14 years G. December 9, 2010 e-mail updates from Stacie Kvilvang, Ehlers and Associates H. TIF model including$1.4 million in assistance provided over 16 years City oftlyden Hills City Council Special Work Session December 13, 2010 Page 4 of 4 Attachment A Map of Development District No. 1 with Tax Increment Financing District No. 4 �I J f� i f 35W E p 1 1 0 Sri E' r ■..P1 . p C9� __.—r�7_ • 1. .41■:11�� .11 �'� �•`..1111111.� tr ��� •o .ii,�rll.. ■ui\`11.E :ui4lq lili'^ ,'�!l ♦r li 1i11111 b 4r ►t r(JI. wlw.�� 4iasari' � � � ^ 'IYa■�■'irPr■uq■w� � �■ilkl. 1'; ��■...4� ..� tip` ®�.::;.■�. �iii��rd�`���f ��1��■�f� �� ♦ :�11111i.�//I� 69 111■�.Illllll►� � �� 35W ■�1�11` �� r �y e 1�4111/j- h7t..a � �,+rw u�;�;p�i.� �I.��tilurf.,rr r� ®®' ■, �i trI±JC� W,�� /��.Or ua d5►��I�Ol���i M®:�i®'. HIM � • � � • tlntl �.=� Al�iiii� i �-i -----�a► 'fly i 1 �,or.a r ���,� . IGS■iLL.J� �ofy�I ....... Illl"'iI11111I��1111 fi■_ ,♦wll■ e� .I"i1.1►t'��ne..nn.l■■ �::�.:� ����II � Ilrl 111 t �1�1:al�,ll■■Purr■ A�IIIaf1 a��A...uuu■ �' (oJ pl �wi �ail rlll 1111[rl.�= II ;'1\`�ffi'Z, O� 5�. .11i11Yuw uunu�I_ tl `� ��"IIIIYI1111 IE��Mlllll�� ,Pli A ! uuJ•IIII i1'''Illlll►;; �I �rllllllll ` —I. iuullulllkllllllpllll!1111\� r� I�Ni}l+�I � �'1 .nu1111un mn Ivum' =fir —��.�. :•#1►� =I-;� Attachment B Procedure for Application to the City of Arden Hills for Private Activity Revenue Bond a Financing L ILLS PROCEDURE FOR APPLICATION TO CITY OF ARDEN HILLS,MINNESOTA FOR PRIVATE ACTIVITY REVENUE BOND FINANCING Approved by the Arden Hills City Council Effective as of September 14,2009 Finance Director City of Arden Hills 1245 West Highway 96 Arden Hills,MN 55112 a PROCEDURE FOR APPLICATION TO THE CITY OF ARDEN HILLS FOR PRIVATE ACTIVITY REVENUE BOND FINANCING i Table of Contents Page PartI General..........................................................................................................................l PartIf Guidelines.............................. ......................................................................................2 Part III Miscellaneous Matters...................... ...........................................................................5 Part IV Application,for Tax-Exempt Financing (Connmercial,Industrial,Health Care or Other Non-Housing Projects) .....................7 Part V Application for Tax-Exempt Financing (Multi-Family Housing). . ..........................................................................................1 a Part Vr Addendum to Application..........................................................................................13 Part V1I Indenuiification Letter of Agreement.........................................................................14 �Y .S l .k PART I v GENERAL Under the Minnesota Municipal Industrial Development Act, Minnesota Statutes, Sections 469.152 to 469.1651 (the "Industrial Development Act"), the City of Arden Hills has authority to issue revenue bonds or notes to attract or promote economically sound industry and commerce to the City. k Under Minnesota Statutes, Chapter 462C (the "Housing Act") the City is authorized to issue f housing revenue bonds to finance multi-family residential housing projects .for low and moderate income persons and elderly persons. Projects must be embodied in a Housing Program as that term is defined in the Housing Act. The Council is aware that such financing for certain private activities may be of benefit to the City and will consider requests for tax exempt financing subject to these Guidelines. The Council considers tax exempt financing to be a privilege,not a right. It is the Judgment of the Council that tax exempt financing is to be used on a selective basis to encourage certain development that offers a benefit to the City as a whole, including significant employment and housing opportunities. It is the applicant's responsibility to demonstrate the benefit to the City,both in writing and at the required public hearing. The applicant should understand that although approval may have been granted by the City for the issuance of financing for a similar project or a similar debt structure, that is not a basis upon which approval will be granted. Each application will be judged on the merits of the project as it relates to the public purposes of the Housing Act or the Industrial Development Act and the benefit to the City at the time the request for financing is being considered. _ In no event will the City issue private activity bonds for the primary purpose of financing operation _ expenses of any borrower; provided that bond proceeds may fund reasonable operating and replacement reserves where the primary use of proceeds is to finance capital expenditures. t 1 F i� PART 11 GUIDELINES 1. The Council will consider tax exempt financing for commercial, industrial health care, and any other projects authorized to be financed under the Industrial Development Act(referred to as `Sion-housing projects"), and housing projects under the Housing Act. An applicant for tax exempt financing for non-housing projects pursuant to the Industrial Development Act must submit to the City the application contained in fart IV of these Guidelines. An .a applicant for tax exempt financing for housing projects pursuant to the Housing Act must submit to the City the application contained in Part V of these Guidelines. 2. Projects must be compatible with the overall development plans and objectives of the City { and comply with the zoning and land use regulations of the City. 3. An application will not be considered by the Council until tentative City Code findings and _ requirements have been made with respect to zoning, building plans, platting, streets, and utility services. The application must be accompanied by the addendum contained in Part VI of these Guidelines and must provide information as to the project's need for municipal services including, but not limited to, street improvements, water and sewer services, and police and fire protection. 4. The project must be a positive benefit to the City. The project must be of a nature that the City wishes to attract, or an existing business which the City wishes to have expand within the City, considering employment opportunities, incentive for finther development, impact E on City services, and support for the industrial, commercial or health care or educational facilities currently located in the City. A housing project must provide significant housing opportunities for low and moderate income persons or the elderly. S. The Council will, if requested, grant an applicant a pre-application review. The purpose of the pre-application review is to inform applicants of the possibility of rejection or the possible bases for such rejection. The fact that the project is not rejected at the pre- application stage is not to be construed as approval of the project or as an indication that the project will be approved upon formal request to the Council. Requests for tax exempt financing may be rejected by the City whether or not the project was submitted to a pre- application review and regardless of the outcome or recommendation of that pre-application review, 3 A request for pre-application review must be in writing, addressed to the City Finance Director, and set forth the name of the project, the type of project intended and the name, address and telephone number of the person who will be representing the applicant at the pre-application review, together with such additional information as the applicant desires to submit. 6. The applicant must select a qualified financial adviser or underwriter to assist the applicant in preparing all necessary application documents and materials. The financial adviser will submit a letter that establishes the financial feasibility of the project. Applications may, in the alternative, include a signed letter from a responsible financial institution indicating that 2 ........................... :E M the project is economically feasible and viable and stating that bonds can be successfully sold for the project or that an individual or institution intends to purchase all of the bonds. The applicant must receive approval from the appropriate state agencies, secure financing and commence construction within one year of the date of the resolution giving preliminary approval to the project or the housing program. Upon application,the Council may approve an extension of the preliminary approval. The City will appoint bond counsel for the bond issue, which will normally be the City's regularly retained bond counsel. 7. Pursuant to the Industrial Development Act and the Housing Act, consideration of an application for tax exempt financing must be done at a public hearing held by the Council. v Modifications to the project after the public hearing and preliminary approval must be consistent with the scope of the project as proposed at the time of preliminary approval. t - 8. The City is to be reimbursed and held harmless for and from any out-of-pocket expenses related to the tax exempt financing including,but not limited to, legal fees, financial analyst fees,bond counsel fees,the City staffs expenses in connection with the application, and any deposits or application fees required under state law in order to secure allocation of bonding authority. The applicant must execute a letter to the City undertaking to pay all such expenses. A form of the required letter is set forth as Part VU of these Guidelines. A non- refundable application fee in the amount of$500 must be included with the submission of the application. 9. Prior to closing and delivery of the bonds for the project,the applicant must pay, or commit to pay an annual administrative fee in the amount of 1/8 of 1% (125%) of the outstanding principal balance of the bonds. The administrative fee may be paid in a lump sum at closing - on the bonds, or may be paid semiannually while the bonds are outstanding at the times specified in the bond documents. The administrative fees required by this paragraph will.be _ adjusted at or paid prior to delivery of the bonds if necessary to ensure compliance with the Internal Revenue Code and regulations. If the City determines that issuance of the bonds requested by the applicant is reasonably expected to cause governmental bonds issued by the City in that calendar year to be ineligible for designation as "qualified tax exempt obligations" under Section 265(b)(3) of the Internal Revenue Code of 1986, as amended (also known as "bank qualified"), the applicant will be required to reimburse the City, at the time of issuance of the City's bonds, for any interest rate differential between bank qualified and non-bank qualified bonds. 10. Applications for finarcing must be'made on the fortes attached to these Guidelines. In addition, the applicant must furnish a description of the project, a plot plan, elevation of proposed buildings, landscape, lighting, and site preparation, together with a brief description of applicant and the proposed financing in such form as required at the time of application_ 11. The Council may, in its sole discretion, impose conditions exceeding those required under the City building code in respect to exterior building materials, landscaping, signage 3 T 'k 3' 3 lighting, and such other aspects as the Council may consider appropriate on a case-by-case { basis. 12. The Council may, in its sole discretion, withdraw its preliminary approval of a project any time if in its judgment the purposes of the Act will not be served by going forward with the project and its financing. z S :5 5 i 4 a u" E �K b i5 PART III MISCELLANEOUS MATTERS 1. Ratings. The City will give its most favorable consideration to proposed tax exempt bond issues that have the same rating as the City's obligations by Moody's Investment Service or Standard&Poor's Corporation. . Issues carrying lower ratings or non-rated issues may be sold only to institutional or other investors on a private placement basis and must be in denominations of at least$100,000. The Council may depart from this guideline when in its t judgment the project is of a level of merit and public purpose to justify the departure; and in - case of such a departure the Council must state its reasons therefor in the resolution awarding the sale of the bonds. 2. Refundinas. The Council will normally approve the refunding of a tax-exempt issue but only upon a showing by the applicant of(i)substantial debt service savings, (h)the removal v of bond covenants significantly impairing the financial feasibility of the project,or(iii)both (i) and (ii). In the case of refundings of bonds for which the administrative fee listed in paragraph 9 of Fart II have been paid in fall,no new administrative fees are required;but the non-refundable application fee must be paid together with all City expenses in excess of that fee. If the administrative fees for the refunded bonds are not paid in full upon closing on the refunding bonds,such fees must continue to be paid for the refunding bonds. In the case of refimdings of bonds where no administrative fee has been paid, the administrative fees listed in paragraph 9 of Part H must be paid. The application form is to be appropriately modified. 3. Subsequent Proceedings. Where changes to the underlying documents or credit facilities of - outstanding bond issues are to be made and require Council action (including changes that are a "deemed reissuance" under Internal Revenue Service regulations), no administrative fee is charged but a non-refundable fee of$500 must be deposited with, the City to cover administrative costs. No formal application form is required. 4. Issue by Another Political Subdivision. The City will consider requests for tax exempt financing of projects in the City by other political subdivisions. In these cases the non- refundable application fee must be paid and all procedures through the approval of the preliminary resolution followed. No administrative fee is charged, except actual cost incurred by the City must be reimbursed. The City reserves the right to reject such requests for any reason, including without limitation a determination by the City that such issuance by another political subdivision would impair the City's ability to issue governmental bonds as"bank qualified bonds"(as defined in Part II,paragraph 9)in that calendar year. } 5. City Contact. Initial contacts about tax-exempt financing are made by contacting: Finance Director City of Arden Hills 1245 West Highway 96 Arden Hills,MN 55112 5 l 6. Deadlines, The Council conducts all tax exempt financing matters at regularly scheduled 3 Council meetings held on the second and last Monday of each month. Documents for Council consideration must be at the City office on the Monday preceding the Council meeting at which the matter is to be considered. In the case of a publicly offered bond,issue 3 the documents, when submitted, may specify a maximum price and maximum effective interest rate if prices and rates have not yet been established. Post-Issuance Com fiance. The City will require that each borrower demonstrate to the City that the borrower will comply with substantially the same procedures for post-issuance compliance that apply to City governmental bonds under the City's Post Issuance Debt Compliance Policy, approved September 14,2009,as amended from time to time. The City may require that borrowers retain a trustee and/or an independent arbitrage consultant for the term of the bonds. sf 6 ....... .......... ........ PART IV APPLICATION FOR 4 TAX-EXEMPT FINANCING (Commercial,Industrial,Health Care or Other Non-Housing Projects) 1. APPLICANT a. Business Name: b. Business Address: C. Business Form(corporation,partnership,sole proprietorship,etc,)-. d. Authorized Representative: 0. Principal contact person and telephone number: 2. PURPOSE OF REQUESTED FINANCING: a. New Facility(describe): b. Expansion(describe); C. Refunding(attach explanatory letter) 3. GIVE BRIEF DESCRIPTION OF NATURE OF BUSINESS, PRINCIPAL PRODUCTS, ETC.: 4. ESTIMATED PROJECT COSTS: (Not required for refunding) Land Building Equipment Architectural,Engineering Costs of Issuance Capitalized Interest, including discount Other Total Financing Requested 5. AMOUNT OF FINANCING REQUESTED: C_210 ofproject costs) 7 5 y V b. TYPE OF FINANCING PROPOSED: Bonds Tax Exempt Mortgage r Expected Terin of Financing Years Security: Mortgage Letter of Credit Guaranty(third party) Guaranty(personal) Unsecured Other(specify) 7. BUSINESS PROFILE: (Not required for refunding) a. Is the business located in the City of Arden Hills now? b. Number of employees in City: 1) Before this project: - 2) After this project: C. Approximate annual sales: 3 d. Length of time in business: Length of time in business in City: C. Do you have plants in other locations? If so,where? S. NAMES OF: a. Underwriter(name and contact person): x i 'F b. Corporate Counsel: 3 C. Underwriter's Counsel: r 8 k �i 9. WHAT IS YOUR TARGET DATE FOR: a. Construction start: b. Construction completion: 10. Attachments: s a Project description: b. Draft application to Department of Trade and Economic Development -- together with necessary attachments C. Initial application fee d. Indemnification Letter of Agreement I certify that the information provided above contains no misrepresentations, omissions or concealments of material facts and that the information given is true and complete to the best of my ;t knowledge. I have been furnished a copy of the Procedure for Application to the City of Arden Hills for Private Activity Revenue Bond.Financing and is aware of its content and agree to be bound by its terms and the terms of the indemnification letter. Signature Date Title 7� :1 3 ;I M V 9 a 3 S PART V a 1( APPLICATION FOR TAX-EXEMPT FINANCING (Multi Family Housing) DATE OF APPLICATION: k APPLICANT: CONTACT PERSON: t TITLE: ADDRESS: - TELEPHONE{ ) PROJECT NAME: PROJECT LOCATION: PROJECT INFORMATION RENT 'UNITS Efficiency $ One Bedroom $ Two Bedroom $ Three Bedroom $ Parking(included in rent/ not included in rent) $ Laundry $ t 10 s, 5 L I i i Utilities included in monthly rent: a a OPERATING EXPENSES s %of Gross(Annual) TOTAL PROJECT COST: $ DEVELOPER EQUITY: $ a DEBT SERVICE: $ `HARD COSTS: $ LAND VALUE: $ SOFT COSTS: $ *(Hard Costs are all project costs the IRS has determined to be eligible items for depreciation.) ANTICIPATED INTEREST RATES: AMORTIZATION SCHEDULE: % -Year Amortization Schedule If the project were convention- ally financed,what interest rate would you expect to pay? SALES ASSUMPTION: DEPRECIATION METHOD: How many years do you plan to Years: hold the property before you sell? Type: years, At what percent do you feel the value of the project Amount of Total Basis: $ will appreciate? EQUIPMENT: $ of project cost is for equipment(e.g.,washers/dryers) ANTICIPATED INCREASES; ANTICIPATED VACANCY RATE: j Revenue: %per year First Year: % 5 Expenses: %per year After First Year: % CONSTRUCTION SCHEDULE Anticipated construction commencement date. 11 F x F Anticipated construction completion date: ADDITIONAL INFORMATION: f I certify that the information provided above contains no misrepresentations, omissions or concealments of material facts and that the information given is true and complete to the best of my knowledge, I have been furnished a copy of the Procedure for Application to the City of Arden Hills for Private Activity Revenue Bond Financing and is aware of its content and agree to be bound by its terms and the terms of the indemnification letter. Signature Date Title 12 s PART V1 ADDENDUM TO APPLICATIONS The following items must be attached to each application: APPENDIX A A brief description of the organizational structure of Applicant, including parent subsidiary and affiliate organizations(if applicant is other than an individual). APPENDIX Statement of Applicant's business history,including any multi-family rental projects. APPENDIX Q The name, address, and telephone number of 1. The Applicant's legal counsel 2. The Applicant's accountant 3. The architect of the proposed Project 4. The engineer of the proposed Project 5. The general contractor of the proposed Project APPENDIX D I Present ownership of the proposed Project site and Applicant's interest therein. 2. Present zoning of the,Project site and a description of what city land use approvals are needed for thus project. 3. The projected number of new employees to be added to the Applicants permanent work force because of the Project(for Commercial,Industrial or Health Care only). 4. Other fix-ioncing attempted or available to the Project including any interim financing. 5. Statement regarding whether or not this project has all required city approvals. If the project does not have all of the required approvals,list the approvals still needed and a tentative time schedule. APPENDIX E Indemnification Letter of Agreement. APPENDIX F Proforma Analysis of the,Project 13 ... F PART VII INDENfNMCATION LETTER OF AGREEMENT The Mayor of the City of Arden Hills and Members of the City Council City of Arden Hills 1245 Highway 96 } Arden Hills,MN 55112 3 3 RE. Application of for Tax Exempt Revenue Bond Financing by the City of Arden Hills Dear Mayor and Members of the City Council: This letter of agreement is given by , a under the laws of Minnesota ("Applicant") as required by the City of Arden Hills, Minnesota in connection _ with its consideration of an application for tax exempt revenue bond financing for the project described in the application. Applicant agrees as follows: 1. Applicant agrees to pay or reimburse the City for any and all costs and expenses which the City may incur in connection with its consideration of the project and the granting of tax exempt revenue bond financing therefor,whether or not the project is preliminarily approved by the City,whether or not the project is approved by the State of Minnesota, whether or not - revenue bond financing is finally approved by the City, whether or not the bonds are issued and sold,and whether or not the project is carried to completion. 2. Applicant agrees to indemnify and hold the City, its officers, employees and agents harmless against any and all losses, claims, damages, expenses or liabilities, including attorneys fees incurred in their defense, to which the City, its officers, employees and agents may become subject in connection with the City's consideration, issuance or sale of the bonds for Applicant's project and the carrying out of the transactions contemplated by this agreement and any resolutions adopted, or agreements executed by the City in connection with the issuance of its bonds for this project. 3. Applicant hereby releases the City,its officers,agents and employees from any claims,causes of action, losses, damages, or liabilities which it may have against the City, its officers, agents, and employees or which it may incur in connection with: the City's consideration of the application for industrial development revenue bond financing for Applicant's project;the failure of the City, in its discretion,to issue tax-exempt revenue bonds for Applicant's project; the issuance and sale of the bonds; the construction of the project; or any other matter or thing of any type or nature whatsoever which may arise in connection with the foregoing. 14 s r `a 4. Applicant is aware of the Citys application and administrative fee structure for tax exempt financing and agrees and covenants that all such fees will be paid in the amount and at the tines required. Dated; (Applicant) BY 3 z - I:tS ii i� F i3 s 3 Y 1 f 15 Attachment C Ehlers Presbyterian Homes Proforma Review 1217/2010 Pagel of 5 EHLERS ' i F!lOCIFTF! iHC City of Arden Hills Presbyterian Homes $1,115,000 in PAYGO TIF Sfi RCJES, OF TOTAL % FINANCE TOTALS - DEVELOPERFlNANCING 78.50% 70.60% 38,666,037 DEVELOPER EQUITY 16.28% 16.28% 8,000.000 ENTRY DEPOSITS 5.22% 5.22% 2,565,000 INTEREST EARNINGS CONSTRUCTIONS FUND 0.00% 0.00% 0 INTEREST EARNINGS DEBT SERVICE RESERVE 0.00% 0.00% 0 DIFFERENCE AMOUNT FINANCED 100.00% 4%131,037 0 IRR= 15.48% 0.00% 0 TOTAL SOURCES 100.00% 49 131 037 0 0$6.5 d�. .'•�rWi V 4,+.FE.rfL Per Unit % TOTAL SUBTOTAL TOTALS - ACQUISITION COSTS Land-Triangle Wdte Dom 3.00% 241,000 1,473,743 TIF Eligible Expenses y*r,"rm.xmma 9n';g,i �'4zy� �t Mr w t r. .z �e1oTi0o a ,t�i�g� .'f `000% +- ,'9000 2,883,474 oar 96is1asAbaleRTen� s ;, ,.;' 1 �' i _ "105000 ..Yd.*u�.•a...�.�.5 @� k;7v .�'ifY .�.'3�'�J�:.F20���4 Rate grandfathering 889,243 CONSTRUCTION COSTS BuildinglLand Improvements $154,350 70.98% 31,178.706 34,871,099 i 8 iC � .,,».» �, �.�,,< ��'"�..1�,r'��idLt?'•r�' e 9 �, ��9.;20g�. - Park Dedication $0 0.00% 0 y�'"gneepngE p>•os+eme tg--s: ,:.=� �. r D a.. „$„��90090 , TemporatyRoad7Pa_,rf .-,,.,� "k"t.s.c `��' 0�04%„,y �DO»; Contingency-4% .~3.76% 1,309.419 Land ca l "13 Elrlli"' `. 0 3 ud City Expenses 0.09% 43.000 SOFT COSTS PROFESSIONAL SERVICES Architectural,Engineering&Professional Fees 2.43% 1.195.742 3,964.942 Market Study 0.02% 12,000 Soils 0.021A 7,500 Geo Testing&Other Costs 0.07% 32,700 Survey 0.00% 1.000 FF&E 3.97% 1.950,000 Special Testing 0.06% 30,000 _ Marketing 1.42% 696,000 Appraisals 0.00% 0 City Financial&Attorney Fees 0.00% 0 Legal-Development 0.08% 40,000 FINANCING COSTS 6,879,465 Financial Feasibility 0.09% 45.000 Issuance Fee 0.20% 100,260 Underwriter 1.19% 586,800 Real Estate Taxes 0 Mortgage Registration Tex 0.19% 93,840 Owner Legal 0.09% 35,000 Bond Counsel 0.15% 75,000 Trustee 0.01% 5.000 Debt Service Reserve 5.80% 2.850,000 Interest During Constructions 6.11% 3,000,000 Financing Fee 0.00% 0 Escrows 0.03% 15.000 _ Mise COI 0.05% 25.000 TitleiRecording 0.10% 48,875 PERMANENTLOAN 0 ACCRUED EXPENSES 0 REAL ESTATE TAXES 0 0 CONTINGENCY.4% 0 0 PROJECT MANAGEMENT 1.456,788 Developer Fee 3.78% 1,456,788 CASH ACCOUNTS 0 485.000 Working Cap 0.92% 450.000 Management Start up 0,07% 35.000 Total Soft Costs 12,786,195 TOTAL USES 100,00% 49,131,0371 Prepared By Ehlers IRR Analysis 11-29-10 .. ....... ......... 12/712010 Page 2 of 5 {7 T EYE�11U aPa.�S, HIPIIONSi r %s�., 5 5 Y " .n �:rr:S. MR ,. MONTHLY ANNUAL RENT/ TYPE CHARGE UNITS REVENUE 9aIF1 SalFt Assisted studio $2.700 21 680.400 450 $6.00 studio-C-ty $846 15 162,280 450 $1.88 1 Bdrm $3.300 34 i,346,400 650 $5.08 _ 2 Son $3,850 $ 2R,20q 50. 4.05 _ TOTAL NfA 76 2.456,280 NIA NIA -_ Memory Care studlo $3,000 19 664.000 450 $6.67 1 Bdtm $3,600 16 691,200 650 $5.54 2Bdrm $4,150 1 49800 G50 $4.37 TOTAL NIA 38 1,425.000 NIA NIA independent I Bdnn S1,379 4 66.192 700 $1.97 1 fldrm $1,625 7 136.500 825 $1.97 16drm+Den $1,970 14 330,960 1.000 $1.97 2Bdrm $2.364 10 283.660 1.200 $1.97 2Bdrm $2.660 7 223.440 1.350 $1.97 2 Bdrm+Den $2.955 7 248,220 i,500 $1.97 2Bdrm+Den $3.546 3 127.656 1,800 $1.97 - zBdrm+Den $3.940 2 94,560 2,GGO $1.97 Brown Stone-i Bdrm+Den $1.824 4 87,552 1,000 $1.82 Brown Stone-2 Udrm $2.590 12 372,960 1,420 $1.82 - Brawn Stone-26tlrm+Den $2.919 2 70,056 1,60o $1.82 Brown Stone-2Bdrm+Den $3.192 4 163,216 1,750 $1.82 Brown Stone-1 Bdrm+Den $1.824 2 43,776 1,000 $1.82 Srmm Stone-2Bdrm $2.590 8 248,64G 1,420 $1,82 erovm Stone-2Bdrm+Den $2.919 2 70,056 1,600 $1.62 Rtaym£Sion-2Bdrm+Den $3,i92 2 76y08 1.750 $1.82 - - TOTAL NIA 90 2.634072 NIA N1A Total Rental Income 202 8,515,352 Garage 67,000 Culinary Income 42.180 Housekeeping 1.500 2nd Occupant Income 20.976 Storage 15.000 -- Based Home Care 2,266.244 Beauty Shop 36.360 Telellntemet 84.840 Interest Income 114.000 VendinglGeneml Store 2,700 Mise 19.392 Guest Rooms 4,875 Total Other Income 2,543 411 GRAND TOTAL 202 9,058,783 PKWOMARWEUSUMIR O S"40 First Year N.O.I. 1.677,948 C.A.P Rate 9.00% Sales Expense 0.00% P,,RO:IECTdEST,i!ISS[IMPTJON5,# :' ��'`�aK'�s;r�;xis Private Debt: DEVELOPER FINANCING SERIES A 38,566.037 Amount of Bond-Loan 38,666,037 Term Of Bond-Loan 35 - Rate of Bond-Loan 6.25'1. Monthly Payment 230,301 Annual Payment 2,763,612 DEVELCPER FINANCING SERIES C-TIF Note 0 Term of Band-Loan 0 Rate of Bond-Loan 0.00% Monthly Payment 0 Annual Payment 0 INFIATION,ASSUMP.TIONS,.,_ YEAR 2013 2014 20i5 2016 2G17 Rental Revenue 3.00% 3.00% 3.001/. 3.00% 3.00% Otherincome 3.00% 3W% 3,00% 3.00% 3.00% - Expenses 3.00% 3.00% 3,00% 3.00% 3.00% Vacancy 34.00% 21.00% 10,00% 5.00% 5.00% MONTHS OPERATING 12 YEAR 2018 2019 2020 2021 2022 Rental Revenue 3.00% 3,00% 3,00% 3.00% 3.00% Other Income 3.0014 3-00% 3,00% 3,00% 3.00% Expenses 3.00% 3,00% 3.00% 3.00% 3.001/6 VACANCY 5.00% 5.00% 5,00% 5.00% 5.00% YEAR 2023 2024 2026 2U2� 2027 Rental Revenue 300% 3.00% 3.00% 3.00% 3,00% Otherincome 3.00% 3.00% 3.00% 3.00% $.09% Expenses 3.00% 3.00% 3.00% 3.Cc% 3.00% VACANCY 5.00% 5.00% 5.GD°/ 5.00% 5.00% Prepared By Ehlers IRR Analysis 11.29-10 .... ..... 12/7/2010 Page 3 of 5 FLOW-INCOME Stabilized Ye r Units 4,419.649 6.263.946 5,771.210' fi,122,677 Total Rental 4,419,649 6.263.940 5.771,210 'xF 5'94 u47r 6,122.677 -- Other Revenue ..Fy Garage 36.931 54,150 55776 w'%7 59.171 Culinary Income 33,830 40,575 44910 47,646 Housekeeping 990 1.188 1351 R'�� 31 1,434 2nd Occupant Income 18,908 19.927 20.525 F .� 21,775 Storage 13,521 14.260 14.678 1 15.571 Based Home Care 2,042,767 2.152.932 2,217,520 2,352,567 Beauty Shop 24.002 28,787 31,863 33,603 Telellntemet 54,969 80,598 83 016�`'" 80.072 Interestincome 114,000 114.000 114000 a 114.000 VendinglGeneml Stare 1,782 2,138 2.3664.�` � ;,7a 2.610 Misc 19.392 19,392 19.974 73 21,190 Guest Roams 3.218 3860 4.272 0'1; 4327 Tatst Other 2,364,310 2,531,796 2 810 249 :t937.I`{ 2,762.065 Net Revenue B 783,990 7,795 743 8 381,459 29"-2841 8,884,742 ;Rental Revenue i Units 6,306.357 5,495,548 6,690,414 6,891,121 7,097,861 Total Rental 6.306,357 6.495.548 6.690,414 6,891,127 7,097,861 Other Revenue Garage 60.946 62,775 64,658 66.698 68,596 Culinary Income 49.074 50,546 52.063 53,624 55,233 Housekeeping 1,477 1,521 1,567 1,614 1.662 2nd Occupant income 22.428 23.101 23.794 24,508 25.243 Storage 16,039 16.520 17,015 17,526 18.051 Based Home Care 2,423,144 2,495,838 2,570.713 2.647,835 2.727,270 Beauty Shop 34.817 35.862 36,938 38.046 39,187 Telellntemet 90,714 93.436 96,238 99.125 102.099 Interest Income 114.000 114.000 114,000 114.000 114,000 VendingrGeneral Stare 2.585 2,653 2,743 2.825 2,910 Mlse 21,826 22,481 23,155 23,850 24,565 Guest Roams 4,457 4,591 4.728 4,670 5,016 Total Other 2,841,507 2,923,332 3,007,612 3,094.421 3.183 833 Net Revenue 9,147,864 9A18,880 0,098,027 9,985,547 10,281,694 Rental Raven a 2023 L024 L025 2026r _ Units 7,310.796 7,530,120 7,766.024 7,988,705 8,228,368 Total Rental 7,310,796 7.530.120 7,766,024 7,988,705 8,228.366 Other Revenue Garage 70,653 72,773 74,956 77,205 79.621 Culinary Income 56,890 58.597 60,355 82,165 64,030 Housekeeping 1.712 1.763 1.816 1,871 1.927 2nd Occupant Income 26.000 26.780 27,584 28,411 29.264 Storage 18.593 19.151 19,725 20,317 2a,927 Based Home Care 2.809.088 2,803,361 2,980,161 3,069,566 3,161,653 Beauty Shop 40.363 41.574 42,821 44.106 45,429 Telellntemet 105,162 108,317 111,566 114.913 118.361 Interest Income 114,000 114.000 114,000 114.000 114.000 VendinglGeneral Store 2,997 3,087 3,180 3.275 3.373 Misc 25,302 26,061 26,843 27.648 28.478 Guest Rooms 5,167 5,322 5.481 5,646 5,815 7oWl Other 3.275,928 3,370,786 3,468 490 3.569,124 3.67 2 778 Net Revenue 10 586,725 10 900,906 11,224 514 11,557,829 11,901,144 Prepared By Ehlers IRRAnalysla 11-29-10 121712010 Page 4 of 5 CASH FLOMEXPEI+ESEStAAIA.iDESTa�w 0PERATISJ'(3"- Community Living 3.649,866 3,806,398 3.922,804 4,040,488 4,161,703 Reserves 52001Unit 0 0 0 40,400 40.400 Operating Expenses Total Office Overhead D 0 0 a 0 $4,380,866 Employee Benefits 0 0 0 a 0 Total Utilities a D a 0 a $21,687 Per Unit Total Maintenance 0 0 0 0 o MANAGEMENT AND OTHER FEES Management Fees {57,7341UnitE-5% 339.198 389.287 419,073 431,464 444,237 - Property Taxes-$1,96311,11nit 365,978 357.557 409,484 413,579 417,715 Property Insurance 0 0 0 0 0 - LicensesandFees 731,000 0 0 0 0 Marketing 0 0 0 0 0 Preopening Cost 0 0 0 0 0 TOTAL FEES 1,456,176 766 644 828.557 845,043 861,952 TOTAL EXPENSES 5,106,042 4,593.242 4,751,361 4,925,931 6,064,065 NET OPERATING INCOME 1,677,948 3,192,501 3,630,098 3,703,352 3,820,687 TIF PAYMENTS., -A25,626 153,136 :'A55,724,' CASH FLOW AVAIL.FOR DEBT SERVICE 1,677,948 3.277,873 3,765 724 3,856.487 3,976,462 DEBT SERVICE-SedesA 2,410.377 2410.377 2.763,612 2,763,612 2.763.612 DEBT SERVICE-SedesB 0 D 0 0 a 0 D 9 9 0 CASH FLOW AFTER FINANCING 732.429 867,406 $92.112 1,092,875 1,212,850 0 0 0 0 0 RETi1RNON'dN11ES:`+ANNUALU u. 0.84ti RETURN ON INVES,-AVERAGE -9.16% 0.84% 4.70% 6.94% 8.58% ANNUACOEBTCOVERAGE ' ar. P_89,81%- 135.99% 135:90%. 139.55%- iA3:89% 1 bREF2A'fId1GEXP: �-��briv�-.�`:• - -. 5::�,�,�1,2018,f`-.4xaz .:�2'.. �.:wK';�';.2020.,e.,rwr Z.-'1". 2�.22 Operation 4,286.554 4,415,151 4,547.605 4,684.033 4,824,564 Reserves 40,400 40,400 40,400 40,400 40,400 Total Cffice Overhead 0 0 0 0 0 Employee Benefits 0 0 0 0 0 Total UIRies 0 0 0 0 0 Total Maintenance 0 0 0 0 0 _ MANAGEMENT AND OTHER FEES Management Fees 457,404 470.944 484,901 499.277 614.085 Property Taxes-1%Inflation 421.892 426,111 430,372 434.676 439.022 Property Insurance 0 0 0 0 0 Licenses and Fees 0 0 0 0 0 Marketing 0 0 0 0 0 DeveloperlAdmlNstrativelContractor Fee 0 0 a 0 0 TOTALFEES 879.296 897055 915.273 933953 953107 TOTAL EXPENSES 5,206.250 5,352,605 5,503,278 6,658,386 5,818,061 NET OPERATING INCOME 3,941,615 4,066,276 4,194,748 4,327,161 4,403,633 _ TIF-PAYMENTS . _ "'15T332. ,'it: '1589a6 - >:180,495 `-162,a6; `183.7$1i' CASH FLOW AVAIL.FOR DEBT SERVICE 4,098,947 4.225,181 4,355,243 4 489,26i 4,627,353 DEBT SERVICE-Ser[es A 2,763,612 2,763,612 2.763 612 2,763 612 2,763.612 DEBT SERVICE-Se6es6 0 0 0 0 0 _ 0 0 0 0 0 CASH FLOW AFTER FINANCING 1,335,335 1.461,569 1,591,631 1,725 649 1,663.741 - 0 a 0 0 0 RETUR ANVESANNUAL ::,, s��?;:,> `.`€. 16'.68k:: -: _...1$.27% .. .. -.-.:.38.80% :.:..-, �.. 27.57% ,.. -:33:30% RETURN ON INVES:AVERAGE 9.93% 11.12% 12.22% 13.26% 14,26% ANNUAL DEBT COVERAGE ----14e32% - `:152.89% `'157.59% - <i162.44% :187:44% Operaton 4,969.291 5,118.370 5,271,921 5,430,078 5.592.981% Total Reserves Reserves 40,400 40,400 40,400 40,400 40,400 $606,000 Total Otpce Overhead 0 0 0 0 a Employee Benefits 0 0 0 0 0 Total Utilities 0 tl 0 0 a Total Maintenance 0 0 0 0 0 MANAGEMENT AND OTHER FEES Management Fees 629,336 545.045 561,226 677,891 595.057 Property Taxes-1%inflation 443,412 447,847 452,325 456,848 461,417 Property Insurance D 0 0 0 0 licenses and Fees q 0 0 0 0 Marketing 0 0 0 0 0 DeveloperlAdministrativelContractorFee 0 0 0 0 0 TOTAL_FEES 972,749 992.892 1,013,551 1,034 740 1.056,474 TOTAL EXPENSES 5,982 440 6,151,661 6,32S,871 6 806 218 6,689,855 NET OPERATING INCOME 4,604 2B5 4,749,246 4,898,64 6,052 611 5,211,289 TIF PAYMENTS .165 358 J CASH FLOW AVAIL.FOR DEBT SERVICE 4,769 643 4,916,256 5,067,324 5,052,611 5 211,289 DEBT SERVICE-Sedes A 2,763,612 2,763,612 2,763 612 2,763,612 2,763,612 DEBT SERVICE-SeriesB 0 0 0 0 0 0 0 0 0 0 CASH FLOW AFTER FINANCING 2 008,031 2152 644 2,303,712 2,288.999 2 447 677 0 0 0 a 0 R ETU RNONINVEVARNUAL.., 1;25.08 8'.61 0% RETURN ON INVES:AVERAGE 15.25% 16.22% 17.19% 18.00% 18.84% ANNUALDESTCOVERAGE 172.69% 177.89% '183.36% -- 182,83% - 188.57% Prepared By Ehlers IRR Analysis 1149-10 121712O1O Page 5 of 5 ANNUAUEQUITYREQUIREMRNT a `. ,; n e f of INTERNAL*2RR.EOFaRET,URN;PllAW,,SJSa .QG1T,—YiPARTNER$ a ? �s,h i Year Initial CASH Safe Total Ameuniol Equity 8,000,000 Years Year Investment Flow Price Cash Flow Minimum Rate Of Return-Percent 10.00% 2011 (8,000.000) (8,000,000) Minimum Rate Of Return-Amount 800,000 1 2012 (732,429) (732,429) 2 2013 867,496 867,496 3 2014 992,112 092,112 SA L'ANiCL:SIS 4 2015 1,092,875 1,092,875 5 2016 1,212,850 1,212,850 Net Operating Income Year15 4,463,633 6 2017 1,335,335 1,335,335 Divided By Cap Rate 9.00% 7 2018 1,461,669 1.461,569 Gross Sale Price 49,595,919 8 2019 1,691,631 1,59t.631 9 2020 1,725.649 1,725,649 Minus Debt-Bank-End 2022 34.322062 10 2021 1,863,741 15,273,857 17,137,698 Net Sale Amount 15,273,857 Developer 15.273.857 0 Sales Expense 0 Final Amount 15,273,857 Total (B,aoD,aoo) 11,410,828 15.273,857 18,684,685 15.48% Prepared By Ehlers IRRAnalysis 11-29-10 Attachment D Comparison of Conduit Debt Issuance Fees Conduit Financing Fees Community Application Fee Fee Surrounding Communities Roseville $2,500- Non refundable $10,000 or 1%of par amount of bonds, whichever is greater Mounds View $500- Non 1%of par amount refundable St.Anthony None 1%of par amount Vadnais Heights No Policy No Policy Shoreview No Policy Developer covers costs related to legal and fiscal review New Brighton No Policy No Policy,very rare to get request Other Communities Anoka $2,500- Non $10,000 or 1%of par amount of bonds, whichever is greater refundable 1/2 of 1%of paramount plus an on-going fee of 1/10 of 1%of Brooklyn Park $500-Non outstanding principal amount on bonds (looking to change refundable policy to do larger up front fee and do away with annual fee due to issues of getting payment from developers) - Dakota County CDA $1,000- Non Greater of$10,000 or 1/8 of 1%of par amount AND on-going refundable fee of 1/8 of 1%of outstanding principal on bonds Bloomington $2,500- Non Lump sum fee of 0.25%of the 1st$10 million, plus 0.10%of refundable bond proceeds above $10 million 1. For new and refunding issues, lump sum fees of 1%of the 1st$5 million of principal, plus 0.5%of the next$15 million of principal, plus 0.25%of bond amounts greater than $20 million Blaine 2. For projects outside of Blaine, a lump sum payment of 0.5% of bond proceeds 3. For municipal consent to obtain conduit financing elsewhere for Blaine projects, .0125%of bond proceeds for Blaine portion of the project Attachment E TIF Background Calculations w arrN r af0i v a m � m o m it d O Q Q �F ; TTTT m aaaa a ¢ v O m � � N f0 co f�fl 7 7 fL aD ': } ^L�«m'•., A.i °_©:' e� �-`-� y f9617 cei«« «:.N.«.:.-. ^•�..em mmmtlm„ '�. w.m+ E C L 3.»-- ui psi F[i r r.:...:„„::.;.:: .».„..�;_...m �a m O m o o v O c+r-..nsr°.»;;:c:u:c:;„'.."ee•"..a�:.:i®e s a%e,-"' U¢ x �'c-- ~ LU U 3rce E C O 0 x 0 _ F p C O co e m m x w E.- E C g'.. IL Sof > E. _ m W m a a a.it �Y �``-' W m dU 01fy fR fR w F 6a: p 16 ID o Ex" 0 p—m f--=-<n3-�-b,c L LL 0°' z2 JU EL; . _ N W d d L """W K = Y p+ w -o v e m m oa a r� Z .j c m M`oaaq m Wa {+ a .❑ 7� � w • �7 p O a N U r m000 7 V O E i A oo m to o a > m c ' Q [D a - O N N « 000('] C YN ppr m � m m N e „`�r 7fONQ o e U1 O 0 FF(()),, N =rO MN Nr NZ N lm0 N 01 Ct y0 r_9 EoNDr ^`0LO ra imr —m W :ir oM�2 125 a W ' _ 4 awn f0 Z O Wp 7 0 01 > O r+Rc a m ❑ a J Y C ix to c N 0m Om E Ca m av ;'se c a� y5 yew E�>- �aiomm wm romrte - r�0 c NN L V O N.-• l6 Q U 9 QNNN� � mE Nl7 „crEizz N17 � om 0 0w NN ME Z. r = yo 0OL>u 05BE0>-o Z. vas mmm =g oCc L'=�� 0EEE N C fl-�yUp m�m'aOQ O�Qm an mmm; � A Z❑��d'wi'a NOOvO aLi 00sa'Lo m Oydm�;- CLaY�'�awimA°x1� wE_E__ ❑❑L)I W.S.S d E F-0> AFL,IL o ❑vw� y w a C�Ci Ci m n cp M M p r r�-I m m Jr rl o"l e 0 p.F r C7 C�M n;n: Z N O Q¢:a �'". L w itl a a d m�V�V��➢ 00000 r N m Ll. • O a � m d � m0000 a °000000 �r � � a ° � U Q d Z � d d cn d =mao 0 0 0 0 It m d w'O 0 0 0 0 0 EN ~ d U E o - s a-4 rn a =mM d O.O 000000 ~ U EN O - d ° y U 'o d m � mN 'o 0 0 IL.7`ro tiltih4W: c p,p�O o0o wo N o0o m L, EN�0000 xLL N li)1O t0 N A$; G o d V m ogg;y7% ^a°aia@ a X. z m UatL2;;Tai..-'sl^"i a Wa = _� • m z cc _ l0 y� 1 •in (Q C d x H w" N N-E m G P O O K 'L C Fw- X N N N N Wa p of m d CL cq O y • 4 0:"4!J d • w y m m m C U a�- n�vti a cce d v 3� o �C N 0000 0000� � aoN 97m0000 � X� o000 s. r�N I+0000�' u �wp�no0pz m0000 YLL MOOOI° W OHU �O�i7� 16 6' d In cc �'«'» M.!V'�iL.?=fD„:fOi:.".•;".r, D U t6 N 00 O O 6�, C >. i3¢�1.%�f:mm:iw m W=-WW`'. y x .N • p a � • E ° w vai xa mUH ° .. 0000� 7 C a. •4 16 %U O G O'I C 6 - Z a e6 N ON OO'Ii 3 � QN0 °� ��riuir�. Ea ID E m • wa1`e[m 6 ° y X w m U w a' w�a H C i0 O W F¢d f-1L 4 N 0 y X a aE d E« d = �' r�s y.00 n w wE m °a�v m2 [ate L-07 wy m O C ad, O } ?S W i t:j . O n.inN j616Or o.w ° .: a� � NwNcoLi d " o o • a w E d:, "0 NIL m C �U w wwwC Attachment F TIF Model Including $1 .115 Million in Assistance Provided Over 14 Years NM M Q V Nµ`l mmn nm mm W as NMM V V V)V)cDmnnm C `=`>;>;»N N !Z!Q Q QQcz{Q N EV £ 3 E O O O Q O a o 0 0 0 0 0 0 0 0 a d d d O 0 0 0 O 4 4 0 a o 0 0 0 M a 0 0 0 O 0 0 0 0 0 0 0 Q P G(3 0 o 0 0 G O a 0 0 0 C,o o o o 0 C- m Q'Q IO VJm mhn mmmmaO NNc'o M Q'V Vr 0 c00t .�#' s c0 r NN N NN NNN NNNN.. Q d x % rO rO 0 o o o o c o 0 c o o o 0 o 0 0 o a o 0 o o a a 0 0 R a N N N N N N N N N N N N N N N N N N N N N N N N N N N N d Z Yet-y en NLQ Mul��V)LgQ u1n uC mN mLel LQ LQNLQ Lq"t _ W N d M V o r N m w N w air Orr r�!r yr cG C d�r� r E m m m n m m m r m M l0 N h a N v M N m r m m M N n o 2 jp mmNco wmNCV NMI-in Lonln oV N W hm Vm�{M U a O n m m r O ui cO r V er m r m M M N u]m m M m m m n N CO - C C CO NCA7 a) :W Lo CD n N CMMM [si m N r'rin m Qr N N N O - x C 4+ M n N n N m co m o co N W O M m v m cr s� C (6 y rr NNC7m LLI) Lo W�Onn�C4�m61mmoo Or 3 m _ LL � � rrrr gv� E M c0 m M M n n n h CD CO NCO c0 N N O O m m Q O N N h rC-4 On _ {p m m t0 W mm N hrr h h V'V r r r NN ?M ry 3 t cf c0 m m en tTl m m N �Sy N�V�'+f+'+h h�rn r r M M t0 o. x y t NN N Nm 0nh m C V -CO IIt CA C]Or N NQ ell Ni(O�D:. :0 aC F V V wco hh rhhn Y_. m(0 t0 n n n h h rhhhhh � LL z e 'E N riri�al�n vnfcvaonrma)v—ar—Mc wmrocogvwW :0. F vVf--r- u�docnmtotaMc oa000ado e nnW W n nwwmmm:cnnnr. LnLs,rnrnarcrhhrrmu� p =_ vgm(oa000agrorom�N.NNNFi(iMmMMvvvvtc)lnlnW fez: ./.� .+ fA E R E 1.1.1hu1 W O O NNNNMM V V V V III If1>n lfJmmmm Y E O C III W�;{mil ,�w� '� ❑ W_ J� yOw 00�7N N V YOON N C6 e70,mm mm m(O coo 4 m miIJ If1� '. o - 0 2 ddc Vm WccL oc V V V V V)N m ccL C7mmw n I--- -aO4l H M � x t t t mmoaMMmaoMMmmMr�mmVvmmintnrrhhvv_ hr-O Otci ocoo mmmm N N V V In InN p-0[Sic o NN4'7 � a l4 � Zf c � vvhnmmmmmmmmma,mmWWWmmmmm0000 ` c a V r r r a L m ...:. O m ul m r M CO m N n N c m Q 1. x O m c0 O m m I- n W w) T 'ro::C N Q h h Ict co r� h m m IC) m z A V M h:.£ U) C 4 m o co N LO CO u3 CCI v 'i W d t' IpA � r r r r r r r r r r N N Q G. k C O o o O a:x..' 41) o IC] to Ic) V) In 1n u) to µ7 IA to In Y�h,�. O O O O O d O Q O O O c c O N •� .µai~ r r r r r ,- r r +- - r r r r CO T f�pp r� In a o n N O O c3 'r N N ti � 5 .: N Oho C h LR V: M N O N V n O M CO m N In m r v -+.. a F to r r r r r r r r r r acl. A { €a a N N jp' d Yi�Y. a o to in ui ui In to In In In In ui ui In In w a o 0 0 o o o o a o 0 o a o dun% N N N N N N N N N N N N N cV x.0 s j ,.::.:10 Ti o Ln N N o c0 r M m (N In W Cl 2` 4'. a o h m c0 c V o o O N I-- o -{ IO Q m n m h M c' C) M M V y a 0) -T i• o M co W N In CO t t c to n n0 co m m m m m o O O I11 N N N N N N C-4 N N M M M M ' a O'er a C� O F d d O O o O O d c O Q a O O u O O a o o o O O O O o o O O a Attachment G December 9, 2010 E-mail Updates from Stacie Kvilvang, Ehlers and Associates = Patrick Klaers From: Stacie Kvilvang [skvilva rig @ehlers-inc.com] Sent: Thursday, December 09, 2010 11:09 AM To: Patrick Klaers Subject: County Road Costs for your Admin Update Attachments: image001.jpg Pursuant to the TIF statute,the county may require a city to pay all or a portion of the cost of county road improvements out of TIF, if the following conditions occur: 1. The proposed development will, in the judgment of the county, substantially increase the use of county roads requiring construction of road improvements or other road costs; and 2. The road improvements or other road costs are not scheduled for construction within five years under the county capital improvement plan, and in the opinion of the county, would not reasonably be expected to be needed within the reasonably foreseeable future if the TIF plan were not implemented When we discussed the project,we did not see that the project would impact the use of county roads since the redevelopment contemplated was replacing unit for unit(only adding an additional 14 units which isn't substantial). in addition,the only impact is to County Road D which the developer is already paying for. Technically,the county has until December 27`"to make a request to the City, but as stated above it is unlikely because they would have a hard time making a case that the redevelopment is causing significant impacts to the county roads. Stacie Kvilvang Ehlers 3060 Centre Pointe Drive Roseville, MN 55113 Direct 651-697-8506 Fax 651-697-8555 www.ehiers-inc.com EHLE S LEADERS IN PGlBLIG Firm u This e-mail and any attachments may contain information which is privileged or confidential. If you are not the intended recipient, note that any disclosure, copying, distribution or use of the contents of this message is prohibited. If you have received this e-mail in error,please destroy it and notify us immediately by return e-mail or at our telephone number, 651-697-8500. Any views or opinions presented in this e-mail are solely those of the author and may not represent the views or opinions of Ehlers and Associates, Inc. i Patrick Klaers From: Stacie Kvilvang [skvilvang@ehlers-inc.com] Sent: Thursday, December 09, 2010 6:38 PM To: Jill Hutmacher; Patrick Klaers Cc: Sue Iverson Subject: TE Bonds vs Taxable Attachments: 1mage001.jpg Pat and Jill. In answer to Dave's inquiry I can answer"Why can't they do private financing?" To do private financing there will be an increased equity cost, likely in the 30 to 40% range (current amount is 16%) and would require personal guarantees,etc. This not only makes the project more cost prohibitive, but takes away from their benefit of being a non-profit(no guarantees, etc). Currently the market is more volatile and the difference between tax exempt bonds and taxable is not too far off from one another, especially in light of looking at longer term debt(35 years). In order to do an analysis I will need time to talk to underwriters to see what they are seeing in the market for conduit vs taxable bonds for these types of development. As you know, I am out of the office tomorrow but will make some calls. I won't likely have your answer - to this until Monday. If you need to talk to me tomorrow, call me on my cell at 612-801-7732. Stacie Kvilvang Ehlers 3060 Centre Pointe Drive Roseville, MN 55113 Direct 651-697-8506 Fax 651-697-8555 www.ehlers-inc.com EHLERS LEADLIRS IN PUBLIC FiroNGL- This e-mail and any attachments may contain information which is privileged or confidential. If you are not the intended recipient, note that any disclosure, copying, distribution or use of the contents of this message is prohibited. If you have received this e-mail in error,please destroy it and notify us immediately by return e-mail or at our telephone number, 651-697-8500. Any views or opinions presented in this e-mail are solely those of the author and may not represent the views or opinions of Ehlers and Associates, Inc. This email has been scanned for all viruses by the MessageLabs Email Security System. x Patrick Klaers From: Stacie Kvilvang [skvilvang@ehlers-ine.com] Sent: Thursday, December 09, 2010 6:11 PM To: Jill Hutmacher; Patrick Klaers; See Iverson Cc: sbubul@Kennedy-Graven.com Subject: conduit fee - Attachments: image001.jpg; Conduit Financing Fee Analysis.pdf See attached if they paid 1/8 of 1%over time. Stacie Kvilvang Ehlers 3060 Centre Pointe Drive Roseville, MIN 55113 Direct 651-697-8506 Fax 651-697-8555 www.ehlers-inc.com EHLERS HAMS IN PUBLIC FINANU This e-mail and any attachments may contain information which is privileged or confidential. If you are not the intended recipient,note that any disclosure, copying, distribution or use of the contents of this message is prohibited. If you have received this e-mail in error,please destroy it and notify us immediately by return e-mail or at our telephone number, 651-697-8500. Any views or opinions presented in this e-mail are solely those of the author and may not represent the views or opinions of Ehlers and Associates, Inc. This email has been scanned for all viruses by the MessageLabs Email Security System. i City of Arden Hills Conduit Fee Structure Bond 1/8 of 1% Date Principal Rate Interest Total P&I Balance Bds Oustanding 2/1/2011 0 0 0 0 38,600,000.00 48,250.00 2/1/2012 550,000.00 1.30% 1,879,862.50 2,429,862.50 38,050,000.00 47,562.50 2/1/2013 560,000.00 1.45% 1,872,712.50 2,432,712.50 37,490,000.00 46,862.50 2/1/2014 565,000.00 1.70% 1,864,592.50 2,429,592.50 36,925,000.00 46,156.25 2/1/2015 575,000.00 2.00% 1,854,987.50 2,429,987.50 36,350,000.00 45,437.50 2/1/2016 585,000.00 2,30% 1,843,487.50 2,428,487.50 35,765,000.00 44,706.25 2/1/2017 600,000.00 2.55% 1,830,032.50 2,430,032.50 35,165,000.00 43,956.25 2/1/2018 615,000.00 2.85% 1,814,732.50 2,429,732.50 34,550,000.00 43,187.50 - 2/1/2019 635,000.00 3.15% 1,797,205.00 2,432,205.00 33,915,000.00 42,393.75 2/1/2020 655,000.00 3.55% 1,777,202.50 2,432,202.50 33,260,000.00 41,575.00 2/1/2021 675,000.00 3.65% 1,753,950.00 2,428,950.00 32,585,000.00 40,731,25 2/1/2022 700,000.00 3.85% 1,729,312.50 2,429,312.50 31,885,000.00 39,856.25 2/1/2023 730,000.00 4.05% 1,702,362.50 2,432,362.50 31,155,000,00 38,943.75 - 2/1/2024 760,000.00 4.25% 1,672,797.50 2,432,797.50 30,395,000.00 37,993.75 2/1/2025 790,000.00 4.35% 1,640,497.50 2,430,497.50 29,605,000.00 37,006.25 2/1/2026 825,000.00 4.45% 1,606,132.50 2,431,132.50 28,780,000.00 35,975.00 2/1/2027 860,000.00 4.55% 1,569,420.00 2,429,420.00 27,920,000.00 34,900.00 2/1/2028 900,000.00 4.65% 1,530,290.00 2,430,290.00 27,020,000.00 33,775.00 2/1/2029 940,000.00 4.75% 1,488,440.00 2,428,440.00 26,080,000.00 32,600.00 2/1/2030 985,000.00 4.85% 1,443,790.00 2,428,790.00 25,095,000.00 31,368.75 2/1/2031 1,035,000.00 4.90% 1,396,017.50 2,431,017.50 24,060,000.00 30,075.00 2/1/2032 1,085,000.00 5.00% 1,345,302.50 2,430,302.50 22,975,000.00 28,718.75 2/1/2033 1,140,000.00 5.10% 1,291,052.50 2,431,052.50 21,835,000.00 27,293,75 2/1/2034 1,195,000.00 5.15% 1,232,912.50 2,427,912.50 20,640,000.00 25,800.00 2/1/2035 1,260,000.00 5.20% 1,171,370.00 2,431,370.00 19,380,000.00 24,225.00 2/1/2036 1,325,000.00 5.30% 1,105,850.00 2,430,850.00 18,055,000.00 22,568.75 2/1/2037 1,395,000.00 5.40% 1,035,625.00 2,430,625.00 16,660,000.00 20,825.00 2/1/2038 1,470,000.00 5.50% 960,295.00 2,430,295.00 15,190,000.00 18,987.50 2/1/2039 1,550,000.00 5.60% 879,445.00 2,429,445.00 13,640,000.00 17,050.00 2/1/2040 1,640,000.00 5.65% 792,645.00 2,432,645.00 12,000,000.00 15,000.00 2/1/2041 1,730,000.00 5.70% 699,985.00 2,429,985.00 10,270,000.00 12,837.50 2/1/2042 1,830,000.00 5.75% 601,375.00 2,431,375.00 8,440,000.00 10,550.00 2/1/2043 1,935,000.00 5.80% 496,150.00 2,431,150.00 6,505,000.00 8,131.25 2/1/2044 2,045,000.00 5.85% 383,920.00 2,428,920.00 4,460,000.00 5,575.00 2/1/2045 2,165,000.00 5.90% 264,287.50 2,429,287.50 2,295,000.00 2,868.75 2/1/2046 2,295,000.00 5.95% 136,552.50 2,431,552.50 0.00 - 38,600,000.00 46,464,592.50 85,064,592.50 1,083,743.75 Attachment H TIF Model Including $1 .4 Million in Assistance Provided Over 16 Years = N M rM Q V lg to(R Ve h h W m OI m 4 4 N N M M V V�K1 co(D h h W co m m O d N� ��� ����>; NN N N N»N N ti� a E A O O O O O O G O O G O d d d d d d d o 0 o rd rO o rd o o Or o o o C 4 Q O C ?' aptOaCOa90aWaWaWaM MC14M"WiZQWaaaCi4�amaa`Oan`OaW3 roE20 Cl) 4 0 0 o d d d O o 0 0 4 4 4 4 00 4 00 4 000 0 0 0 0 O O O 0 0 0 0 00Im V�LI KJ U3(DhhW W m0100 NNMM�va Vu7 U7mmhh W W mm"`'-,." Y d X 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 o Nd o 0 0 Cq C, N N N N N N N N N N N N N N N N N PEN N N N N N N N N N N N N N i L Q(J m r l[]N tR M R]V v]m u]CO�h�W�W Sri d��-h N Kl M�V�b K]m �, oZ o r (,� M � � � � o; ��or rrirM L; � - � [EL II Z} 2 v a w E :- ai V m Nhhh4 Nr(DM N3 w rrM( (D O MN CO W mNM mm MN V V MO N;-NMDOw 0 CD el LA WrW dU C, lrvmhic [I VW OLLW7l hCl: L N W a cc V hmm Whit co N tor�I--O] Nr O CO Ip M Olp OD � w u C N 7 m h('l W g O W N m V m m m N h r LD m Cp N W Q M h (0 W N Lo m N N Q .0 r r N M m V V LL]LLi W(D h h W W W m O O O r w N Cl N M m m V F d - ----rrrr r - e " a W Wmm NN mmm mm corn w m m co co 0('1 co W MM 0001 0h1+. id MMNN 44 MMO 47 i+h MMM M(D(D V V LO 7 x o ` ' h h W W N N V C r m m N N W W V r r W W W m V V N N M = 6� LO10 nMel 10 LO hCi 01 N N-*-*ti t,o 01 Pi en Lo m m r r C,Fes. E a�mm W W Wm W :i I-{-n m mmm Wm 0)4l CD 000 co o<D CV C N(�F(O�VV��N NN#NNNNNNNN NNNNNNNNNNNNNM f<, W WMMm Mnn m".m� M 01 m m m m m mm m m m m m m m 0: mOC OQ�lfbNNV V1�hc0<W W WW W W WmW OctW W Wmmm Wmmmmep�,°eg: E ��CC°iio ovia�iiyirnvvvvv�vvvvvvvvvvvvvvamin a a N-���UUv.N....N..v.N...N...N...N..�C, C, CN..N y A p (O M � a v 3 � — VV NN V VNNr O 0 to 0 N Co 0 IO M lD 00 f0(O N nco In uy niDW NOD c W Whh MMV V�f7�LlmmmmhhmW mmdd NNmm i(]tD Co C4 w �� ip N vi <= Wes_ -_ � Q JQ API u7 Qd M m hE�W W W W� fJrrm W o010 M0 0 W W h h _ -- oom(MhhLo Lo NN V V N Nm W W(Dhh V V V 4m m W H 3 X C 00(D(O(D(000 V V O?m V Tmm Kf 47r rhh V V rr010)P%hW]L 0 LL?(O NN V)LL7hh m0 PI N hE�00 NN�u7 W and d m M(O CO40 4 •Q C� �+ �L1�hf�Olm 00mm mUl00 o OT r r��� N s V a In G r M`.A` m ui •r a E ` rrrrrrr o aca_ z N c z X - N d m In v Ln N 1!] O 0 4 0 M Y` 0 {� M 4 V OctM Ol m V M O � 00 m m a V /\ E jd f_d O N M m W W W O N K1 m m a V r 7 N K7 O V' m V t` Lo y C'_y�_.` 6 u) W m m m d d N N m CR '�t V N �;i: N N N N N N N N N N Nfti/N: a - CL 0 jd >< y N •� o F� r r r r r r r r r r r r r r r �,_ N � - m m h (A co Ig h V d M W W N d? m M 01 C. m W (D N O LO W V m N W w :� m d N LLY 0 (J W m m (D m Clt O i o ni v co Pi m ui o v a+ v CD N N (V N N ;ffi:N U it <a" 5N N Id !' y. 0 0 a 0 0 0 0 � CD l CD CD h ca 0 �' W 4 d d d d d d d CDC CD CD CN o 0 3 0 jd:::.: N N N N N N N Cl N N N N N N N N C::X h h h E, h h Eh h r-- .- .h- r r r-- ' C C d" o o m N m o N m W m o M h v m �= ca d h m h N M O LO (D LO O N N 0l M "".., w (,j h LL7 m V m M 'CO) JR y X U d 1f7 CO W W 0I m d d N N m a -":*-: W N-.R N N N N N N N m CO M m Cl) co CO m M y, �L O t! U r o 0 o a o 0 0 0 0 0 0 0 o e O FV„ o 0 0 0 0 0 0 0 0 0 0 0 0 0 0 C '0 0 O O O O O 4 O O O 4 O O ID O O O r � r r � r tlea...